The Trail of Gold and Silver Page 17

  Not only did expenses increase, but profits and dividends declined or simply disappeared, discouraging the desperately needed investors. Why should they invest in mining when better returns could be had elsewhere in the booming American economy? Other than locally, Colorado mining was no longer newsworthy. It became more of a tourist attraction than a miner’s and investor’s paradise.

  Caught in this economic vise, Colorado silver miners decided that the villain was actually national monetary policy. The tale went back to 1873, a fateful year in which a dastardly deed had been done.

  In its simplest terms (in which the silverites were prone to cast it), the issue pivoted on the use of silver in coinage. Unlike gold, the market price of silver had fluctuated for decades. That was not the case with Uncle Sam, however. The federal government maintained a ratio of 16 to 1; that is, sixteen ounces of silver equaled one ounce of gold or $1.25 per ounce for silver with gold at $20. Washington believed it had to preserve that ratio to maintain the value of its silver coins. On the international market, however, that policy undervalued silver.

  The predictable result ensued. Silver coins almost disappeared, melted down because the value of the metal was higher than the coin’s face value. Congress responded in 1853 by ending the coinage of silver except for the dollar. Few Americans noticed or cared, but this put the country on a de facto gold standard instead of a two-metal basis. Then, during the Civil War, the government printed paper money, the first “greenbacks.” The public had to have faith in the issuing government because the bills had no intrinsic value. In peacetime, they might cause inflation, whereas gold, with its steady value, would not.

  After the war, businessmen, eastern bankers, and eastern investors wanted to retire the paper money and return to a “sound money” gold basis. They did not want to accept inflated currency for their products or to be repaid with cheaper paper money what they had lent in hard currency. Against them stood Westerners and Southerners, often debtors, who wanted to pay back the gold they had borrowed with inflated-value paper money. Their creditors charged that this would “dishonorably” shift some of the debtors’ burden to the creditors, who were being paid back with “cheaper” money.

  At the start of the 1870s, silver miners who sold on the international market and not to Washington had no such concerns. Silver coins had all but disappeared, replaced by paper money or gold coins. In 1873, Congress made the obvious response and dropped the silver dollar. Few predicted, and even fewer understood, what that action would entail.

  That apparently innocuous move became the infamous “crime of ’73,” the silver miner’s worst nightmare. Thanks particularly to the Comstock’s “Big Bonanza,” and to a lesser degree to success in Colorado, U.S. silver production shot to record highs. At the same time, several countries switched to the gold standard and stopped buying silver. Negligible industrial and commercial needs could not pick up the slack, and the price of silver dropped below $1.20 an ounce in the year of Colorado’s statehood.

  Not worried initially, the unsuspecting miners turned to Washington, only to find that Washington was no longer buying at $1.20 an ounce—or at any price. The situation then became the “crime.” The silverite “cause” was born of desperation and dismay. The miners wanted two things: resumption of silver coinage and a government-guaranteed silver price of $1.25 per ounce. It was an inflationary idea that struck horror into eastern bankers, financiers, and conservatives. Nevertheless, western congressmen, joined by others from farm states where inflation might help hard-pressed farmers, managed to pass the Bland-Allison Act and to re-pass it over a veto by conservative President Rutherford Hayes in February 1878.

  It seemed like a victory at first. The Secretary of the Treasury was ordered to purchase from $2 million to $4 million in silver, at “market price,” each month. Miners now had silver dollars, but not at the 16-to-1 silver-to-gold price they had sought. Further, conservative Treasury Secretaries saw to it that the government purchased the lower amount, so that these dollars would “be as good as gold.” Treasury secretaries of both parties were ready at all times to redeem silver dollars, whatever their “intrinsic value,” in gold.

  Except for the new purchases of silver, the silverites’ campaign had been completely defeated. The issue became contentious in western silver-mining states, including in fervently committed Colorado. Where a candidate stood regarding the cause meant more on Election Day than anything else.

  There also had to be villains in this “great tragedy.” They were easy to find: eastern bankers, foreign bankers, English bankers, eastern investors, their congressional spokespersons, a “Jewish” banker conspiracy, and anyone who wanted to be repaid in “God’s money.” Apparently God favored gold, although the silverites repeatedly pointed out that the Bible mentioned both metals. Second Chronicles 9 recounts how “all the kings of Arabia and the governors of the land brought gold and silver to Solomon,” and Jeremiah 10:9 tells that “beaten silver is brought from Tarshish, and gold from Uphaz.” To the silverites, this proved that God intended both for man’s use as money. Easterners could not believe their western neighbors’ fanaticism. To them it all seemed emotional, illogical, based on fantasy, desperation, debtors searching for an out, miners grasping at silver straws, eager politicians looking for a cause—and it was all those things, and more.

  Throughout the decade, Colorado’s representatives and senators led the fight to save silver, no one more fiercely than Senator Henry M. Teller, who became Colorado’s silver spokesman. He proposed this resolution on March 21, 1882:

  That the experience of mankind has demonstrated the necessity of the use of both gold and silver as circulating medium. That the destruction of the money faculty of silver is in the interest of a few only and not calculated to benefit the great mass of mankind. . . . Resolved: That it is the duty of the United States government to provide a coinage capacity equal to the annual domestic production of gold and silver.

  A few excerpts from his speeches further illustrate the tenor of the times.

  [January 19, 1886, speech] I do not speak in the interest of any special classes of laborers or producers but in the interest of all who toil, labor, and produce; who create by their labor all the wealth of the world; the people who do not stand in high places, whose voices may not be heard in bankers’ conventions.

  While not possessing all the culture of the age, they exemplify the many sterling virtues of the race and do much toward keeping alive sentiments of honesty, justice, and truth—as mighty in numbers as modest in aspirations.

  What I do demand is that it [silver] shall have an equal chance with gold as a money metal.6

  Horace Tabor joined the fray as a very interested party. “Why should America, the greatest producer of silver, allow any foreign power to set the price of silver that they are to purchase from us? We have toadied to the English too long.” In a speech on January 30, 1890, he sounded a clarion call:

  Let silver drop to 75 cents per ounce and there would not be a silver mine worked in America, and all our western cities would be paralyzed; our railroads would cease to pay. The laborers who are directly and indirectly interested in mining would be without employment and they would have to get away as best they could and go to the over-crowded cities of the East, leaving their homes (for most of them have acquired good and comfortable homes) for the occupation of bats. I venture to predict that with silver at $1.29, our farmers will never sell their products so cheap again. We demand the money of the constitution, the free coinage of both gold and silver.7

  Both men foreshadowed ideas that reappeared in William Jennings Bryan’s more famous “Cross of Gold” speech.

  Colorado newspapers joined in, often with more emotion than logic. Even before the 1880s, they had issued blasts. The Rocky Mountain News (September 20, 1876) blamed the “money kings of Europe” for the “demonetization of silver.” The Silverton Democrat (February 13, 1886) protested that the “money shortage” meant “dull times and low wage
s.”

  “Every citizen of Colorado ought to feel a lively interest in maintaining this prosperity, and in encouraging the production of silver. How a citizen of Colorado can entertain other views and still believe himself a friend in the interests of the State, we cannot readily understand,” bluntly stated Georgetown’s Colorado Miner (October 30, 1880). A year and a half later, on April 27, the same paper called “demonetization a national calamity.” In Ouray, editor Dave Day, through his Solid Muldoon, repeatedly and vigorously claimed that Ouray, the San Juans, local mines, and just about everybody else were being hurt by “greedy” Easterners and bankers.

  The eastern press fired back at these western radicals, who threatened the very fabric of the country, its monetary system, and its prosperity. The Engineering and Mining Journal voiced its opinion, albeit with less emotion, in its February 7, 1885, issue. This article pointed out that the silver uproar was “seriously alarming the solid business men of the country,” adding “that the United States could not maintain a silver price by itself,” unless “some agreement [could] be made with other civilized governments for the establishment of a double standard.” To do otherwise would “be the height of folly” and would “expose ourselves to the disasters that the continued expansions of our silver coinage expose us to.”

  The editor did make an attempt at placating the silverites, saying it “is our desire naturally to promote the best interests of our silver producers.” It did no good, though: The lines had been drawn and the country was split. Republicans and Democrats, farmers and miners, rural folk and city slickers all joined the fight over the “cause.” The few “gold bugs” in Colorado, if not nearly eternally damned, were unquestionably shunned.

  As Americans are wont to do, the silverites organized. Their National Silver Convention held meetings, published papers and reports, sponsored speakers, and generally helped keep the issue at the forefront. The cause took on new meaning almost every day; they were fighting for their very livelihood, for the America of their parents and their youth. Against them were arrayed the hordes of urban, industrial America—a world they did not completely understand or comprehend and certainly did not yet share.

  Their great spokesman, William Jennings Bryan, summarized the silverites’ feelings when he emerged as the thundering voice of a fading way of American life. In humid, sweltering Chicago on July 9, 1896, he reached an apex with his “Cross of Gold” speech to the delegates to the Democratic National Convention. Few mining men were in attendance that day; nonetheless, Bryan still spoke for them: “The humblest citizen in all the land, when clad in the armor of a righteous cause, is stronger than all the hosts of error.” Enthusiastic agreement with their cause was just, even “holy.”

  Turning to the “gold” Democrats in the convention hall, Bryan issued a challenge. “When you come before us and tell us that we are about to disturb your business interests, we reply that you have disturbed our business interests by your course. We say to you that you have made the definition of a business man too limited in its application.”

  A few moments later, Bryan turned specifically to grievances of Colorado and all western mining states: “The miners who go down a thousand feet into the earth, or climb two thousand feet upon the cliffs, and bring forth from their hiding the precious metals to be poured into the channels of trade, are as much business men as the few financial magnates who, in a back room, corner the money of the world.”8

  Those comments revealed the core of the issue. It was “us” versus “them,” the rich and powerful greedily taking away the livelihood of the “humblest citizen.” As the 1890s opened, Colorado miners and mining girded for the fight of their lives.

  All join ’round and sweetly you must sing,

  And when the verse am through,

  In the chorus all join in,

  There’ll be a hot time in the old town tonight.

  —JOE HAYDEN, “THERE’LL BE A HOT TIME”

  8

  “There’ll Be a Hot Time”

  From the horse to the horseless carriage. From the candle to the electric light. From the train to the plane. From the stage to the motion picture. From the telegraph to the telephone. From rural farm to teeming city. From a wilderness territory to a state. A teenager in the Pike’s Peak rush would have seen it all by the time he or she reached a seventieth birthday. By then, as World War I neared, several mining booms and busts had occurred, once-bustling camps had become ghost towns, and that teenager’s generation had been hailed as pioneers.

  It had been a “hot time” in the “old” towns of the Rocky Mountain country. Marvelous, amazing, shocking, unbelievable: these were only a few of the words used to describe those years. Americans watched their pace of life pick up and their world simultaneously shrink and broaden. Change occurred everywhere in the mining West, but particularly in the towns.

  Seduced by both its beauty and reality, artist/writer Mary Hallock Foote painted a word portrait of her Leadville home.

  The Leadville scene, when it wasn’t snowing or sleeting or preparing to do both, was dominated by a sky of so dark and pure and haughty a blue that “firmament” was the only name for it.

  [Nothing marred the beauty] Indiscriminate houses dropped here or there did not count, nor smoking chimneys of smelters, nor brass bands every evening, if you lived far enough from the streets, they paraded to get the sound softened without sounds of the human surf beating on the flanks of those gulches.

  Leadville was one of the wildest and also one of the most sophisticated of mining camps.1

  That was Leadville in 1879. Americans were intrigued, repelled, amazed, and stunned by what they read about the goings-on in Colorado’s urban mining communities. There was change everywhere, however, not just out in the Rocky Mountains, as the United States raced into the Industrial Age.

  Perhaps because they lived in a world of constant and accelerating change, many Americans became fascinated by the relics of an earlier age that littered the Colorado mountains and valleys. In many places, boom and bust cycles had left only a few locals still hanging on to the hopes and dreams of yesterday. As these old-timers looked at the sagging buildings, shuttered windows, rotting board sidewalks, and rats scurrying about where people recently had walked, talked, and danced, they could only remember with melancholy what had once been. Visitors, though, could imagine and speculate before hurrying through and leaving the fading past behind.

  These camps and towns had once been a fast-moving, exuberant urban world—an urban West, not the more typical slow-moving, slow-settling rural frontier of Midwestern fact and legend. In reality, the mining West had never been a frontier; the initial settlements had brought near-instant urbanization. This phenomenal urbanization/mining conjunction could plainly be seen in towns such as Aspen, Telluride, Leadville, Georgetown, and Central City. The more numerous smaller camps, such as Animas Forks, Caribou, Buckskin Joe, and Schofield, dotting the landscape almost all had dreamed of becoming towns. Many had tried to jump-start the process and call attention to themselves by adding “City” to their names. Despite their best efforts, however, the vast majority did not evolve much beyond the first months after their birth.

  What was the difference between a town and a camp? Towns had a larger population, a greater variety of businesses, permanent architecture beyond log cabins and one or two frame buildings, richer mines nearby, and a spirit and confidence that did not exist in a camp, no matter what camp residents might claim. Camps had a general store or two, generally rougher architecture, less prosperous mines, and a smaller population. Many of the camps teetered on the brink of becoming “ghost towns” as early as the late 1870s, and by the turn of the century most of them had become relics of the past rather than promising hopes for the future.

  These camps and towns, however, framed the picture of mining for the tourist public, and often the reading public as well. Dark mines deep in the earth might be fun to visit once or twice, especially if one owned stock, but in boom tim
es the mining communities offered excitement, tolerance, and a flair rarely seen in Victorian urban America. They had one foot in the America of an earlier age and the other in the erupting industrial America of the late nineteenth century. They represented some of the best and some of the worst aspects of a country in the throes of transition.

  Helen Hunt Jackson tried to give her eastern readers an impression of a mining camp:

  It is hard to keep separate the fantastic and the sad, in one’s impressions: hard to decide which has more pathos, the camp deserted or the camp newly begun, the picture of disappointment over and past or that of enthusiastic hopes, nine out of ten [of] which are doomed to die. I have sometimes thought that the newest, livest, most sanguine camps were the saddest sights of all. . . . The expression of a fresh mining camp, at the height of its “boom” is something which must be seen to be comprehended.2

  Leadville in particular, at its amazing peak of wealth and electrifying pace of growth, fascinated Americans country-wide. No other Colorado mining town either of its era or later—except perhaps Cripple Creek—ever matched its mystique, captured in an 1879 pamphlet, Leadville and its Silver Mines:

  LEADVILLE! The very name has, within the last few months, become synonymous with sudden wealth and wild dreams. Tens of thousands of persons between the Alleghenies and the Pacific coast, and many no doubt on the Atlantic coast, are turning their feverish eyes toward this place, and saying, “Were we but in Leadville, we might strike a fortune to repair the disappointment of our past lives.”

  The town has now—no one can tell what it will have next month, people are pouring in so fast—six well defined streets. The population to-day is about six thousand, moderately estimated; next September it will probably be ten or twelve thousand. It is the highest city in the United States.3