| | Nevertheless, historians emphasize business and government scandals that occurred in the absence of modern regulation. In 1869, for example, there was the "Fisk-Gould Scandal," in which financiers ("Wall Street" types) tried to corner (monopolize) the gold market. This caused "Black Friday," with the price of gold first going way up, and then going way down. The Grant Administration broke up the scheme by selling gold reserves. | | Nevertheless, historians emphasize business and government scandals that occurred in the absence of modern regulation. In 1869, for example, there was the "Fisk-Gould Scandal," in which financiers ("Wall Street" types) tried to corner (monopolize) the gold market. This caused "Black Friday," with the price of gold first going way up, and then going way down. The Grant Administration broke up the scheme by selling gold reserves. |
| − | '''Debate: Is there anything wrong with speculation, or prices going way up and then way down?'''
| + | Speculation is a form of gambling with the price of land, or gold, or stocks, causing the prices to fluctuate widely and hurting people who lose money because of it. Speculation about the price of gold was considered undesirable because it pushed the price much higher than its real value. |
| | Next government corruption occurred in the Credit Mobilier scandal, which consisted of bribery with a construction company that had been created by the powerful Union Pacific Railroad in the period of 1865-69. This scandal, first uncovered in 1872 by Congress, symbolized the government corruption of the Grant Administration. Specifically, owners of the Union Pacific Railroad formed a new company, the Credit Mobilier of America, in order to award it with profitable contracts to build a railroad out West. Then stock in this construction company was given to influential congressmen, who next approved spending taxpayer money to pay for the railroad construction. The result was huge profits for the owners of the railroad and the congressmen, at the expense of taxpayers. A New York newspaper publicized the scandal just before the 1872 elections, and the Speaker of the House (the Republican James Blaine of Maine) set up congressional hearings to investigate and publicize the scandal. The hearings lasted into 1873 and discredited the government.<ref>http://cprr.org/Museum/Credit_Mobilier.html</ref> | | Next government corruption occurred in the Credit Mobilier scandal, which consisted of bribery with a construction company that had been created by the powerful Union Pacific Railroad in the period of 1865-69. This scandal, first uncovered in 1872 by Congress, symbolized the government corruption of the Grant Administration. Specifically, owners of the Union Pacific Railroad formed a new company, the Credit Mobilier of America, in order to award it with profitable contracts to build a railroad out West. Then stock in this construction company was given to influential congressmen, who next approved spending taxpayer money to pay for the railroad construction. The result was huge profits for the owners of the railroad and the congressmen, at the expense of taxpayers. A New York newspaper publicized the scandal just before the 1872 elections, and the Speaker of the House (the Republican James Blaine of Maine) set up congressional hearings to investigate and publicize the scandal. The hearings lasted into 1873 and discredited the government.<ref>http://cprr.org/Museum/Credit_Mobilier.html</ref> |