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-, 1
OBSERVATIONS
OH THE
REPORT OF THE COMMITTEE
OF THE -
SENATE OF THE UNITED STATES
RESPECTING THE
CREDIT MOBILIER OF AMERICA
/
By J. W. PATTERSON
: ~ *
WASHINGTON, D. C.;
M'UILL it WITHEROW, PRINTERS ASD STEREOTYPERS.
1873.
OBSERVATIONS
ON THE
REPORT OF THE COMMITTEE OF THE SENATE OF THE UNITED STATES
BESPECTING THE
CREDIT MOBILIER OF AMERICA:
BT J. W. PATTERSON.
TO THE SENATE OF THE "UNITED STATES :
I respectfully solicit permission to address to the Senate some observations
on the Report of the Select Committee appointed to consider certain evidence
affecting members of the Senate, taken by a Committee of the House of Representatives,
and transmitted by the House to the Senate.
That Report was communicated to the Senate on Thurs-
b
day, the 27th of February.
It was not accessible in print, even to members of the Senate, until the evening
of Friday, the 28th of February.
At that period of the session there remained but three days and a part of a fourth
for the transaction of what was left of the business of the session, including
several of the most important appropriation bills and other public business of
great moment, which exigently occupied the attention of Senators night and day,
so as to encroach, indeed,. upon the hours of devotion and repose of the Lord's
day, the 2d of March.
I made an earnest effort at the earliest moment when it was3 possible for me
to obtain the floor, that is, on Monday, March 3d, to have the Report taken up
for debate. But several Senators, such as Mr. Carpenter, Mr. Hamlin,
2
Mr Anthony, and Mr. Thurman, while concurring in decided expression of their
desire to do justice to my name and reputation in the premises, by allowing me
opportunity of hearing, also concurred in expressing the convic. tion that no
time remained for intelligent debate on the
subject, or even for perusal of tfi.e Report. All they could do was to encourage
me in the expectation that the subject
mio-ht be considered at the approaching executive session
&
of the Senate. In this relation it is proper to say, that on Saturday,
the 1st of March, Mr. Morrill, of Maine, chairman of the Committee, as he repeated
on Monday, the 3d of March, "did call the attention of the Senate to the
fact that the Committee had made a Report in this case, and distinctly stated
that so far as the Committee was concerned, having
+
called the attention of the Senate to the subject-matter, they would wait its
action, and consider that they had performed their duty in thus waiting."
I will not be so uncandid as to infer from this indifference of the chairman
of the Committee, and presumably of the Committee itself, that they desired to
have me deprived of the means of setting myself right before the Senate. I the
rather prefer to conclude that they had come to re-
gret'the harshness of their Report, in the presence of the action of the House
of Representatives. For the House, after most earnest and thorough debate on
the subject, had now refused to vote the expulsion of Mr. Ames and Mr. Brooks,
and refused to apply any censure whatever to the other inculpated members of
the House.
It was thus morally impossible for the Senate to take up and consider the Report
in question during what remained
ot that session of the Senate. Theresult.as to myself personally, was the infliction
of
an^nl ^shlp' not t0 ^ a P081^ wron^, without ex-
Tn h"! : egl91atlve ^^ oftt- country:
Pir- h days of the se88i011 of ^ Senate-in the ex-
^tlod;^^ complete period ot" ^' o\vn 9ervice in
ates therein for emoment ot' my ^P^^o11 from aasoci-or s0 ^y years of reciprocal
friendship,
3
confidence, and esteem, and of the honorable discharge, in common, of duties
among: the highest in the Government of the United States,—at such a time,
a report is presented which, at the close of a Ions accusatory statement of alleged
/ ^ V C1
facts, and of reasoning thereon, submits a resolution for my expulsion from the
Senate, when it was plainly impossible to have the matter discussed, to hear
my defense, and to allow me to endeavor to relieve my character from the stigma
so unjustly, in my judgment, affixed to it by the opinion of certain of my fellow
Senators.
Notwithstanding the hope held out to me that discussion of the subject might
take place at the present executive session of the Senate, Senators have, in
their wisdom, decided otherwise; and nothing remains for me except either to
leave the capital in silence, under the painful sense of the deep injury which
has thus been done to me, or to throw myself on the indulgence of the Senate
in the present manner, for the purpose of indignantly asserting, at least, my
innocence of the wrongful acts charged by this Report, and of entering a solemn
protest against the sentence of condemnation with which it concludes, as being
supremely unjust in itself and wholly unsupported by the evidence on which it
professes to be founded.
The Senate could not refuse to any citizen of the "United States the privilege
of memorializing them in reference to proposed action of the Senate prejudicial
to hia interests or to his reputation: they cannot do less in favor of one of
their late -colleagues, a retiring Senator.
And here, before proceeding further, let me claim not only the indulgence of
the Senate as a whole, but more especially the forbearance of the authors of
the Report.
I make no imputation on their integrity, or their good faith. They had a painful
duty to discharge, and they have come to a conclusion, which, as they no doubt
truly declare,t( they would fain wish were otherwise." I do not impugn their
motives, but only their conclusions. The very atmosphere they breathed during
this investigation was one of passion and of error. They were borne along in
the current of vituperation and misrepresentation, which
4
•
i for a while to overwhelm the better judgment of Sllonses of Congress. It is
in the midst of such cir-com.tances that they have arrived at conclusions demon-strably
erroneous. I rely implicitly on the personal candor and the elevation of character
of each and of all of them, to listen patiently and without offense to criticism
of their Report, so far as the same may be necessary to relieve me from the heavy
imputations which they have cast upon me as a Senator and a man, as they themselves
would desire to be heard, if, which G-od forbid, the mischances of political
life should ever involve either of them in. unjust
*
accusation. The Report, after presenting what purports to be an
abridged recital of the evidence affecting me, sums up the whole as follows:
"
The Committee cannot escape the conclusion that Mr. Patterson, being a Senator
of the United States, in August, 1867, contracted with Oakes Ames, a member of
the House of Representatives, for the purchase of thirty shares in the stock
of the Credit Mobilier of America, at rates ffreativ-
7 0 •/
below its esteemed value, and subsequently came into possession of the same;
that he received the dividends which were from time to time declared thereon;
that he subsequently, in the year 1869, dealt with Mr. Ames to a large amount
in the stock and bonds of the Union Pacific Railroad Company for the purpose
of profit, and disposed of the same in the stock markets of ^ew York, with the
knowledge of the character of the Credit Mobilier, and of its relations to and
connection with the Union Pacific Railroad Company; and further, that he had
knowledge or the interest of Mr. Ames in, and bis connection with, said companies;
also of the object of Mr. Ames in thus aeahng with him was to secure his friendly
recognition of ttie interests of said companies and his own interest there-
^•^- lnfluence ^s action as a Senator in matters of nS ? .affectlDS the
same; and further, that, being in-^"L lllrelatlon thereto before committees
of both acS L+ colTe£;8' he gave a false account of the trans-
riafact.^ ^T f and Mr- ^es, suppressed mate-
wnen 'n^ (ienled the ^stence of other material facts wmcn must have been well
known to him."
^ow, it is my duty to say, in self-vindication,—it is my
5
right to say, because it is true,—it is said by me in sorrow rather than
anger,—thia inculpatory statement is inaccurate to the last degree: it
states some things which are absolutely contrary to the proofs; it contains inferences,
set forth as proved facts, although such inferences are not supported hy the
facts, and are not true; it states innocent facts in a form of exaggeration to
make them seem to be wrongful; it imputes knowledge of wrongful purposes on the
part of others, without any proof of such knowledge, and contrary to all presumptions,
both of law and fact; it charges action under corrupt influences, not proved,
and contradicted by the evidence; and it magnifies forgetful-ness of some of
the details of a transaction long past, or of its possible relation to other
transactions, into imputation of suppression of material facts, or affirmative
or negative false statement of facts.
In order fully to comprehend the manifest errors which constitute the essence
of the Report, it is necessary to take up the summary in detail, and examine
the several propositions which it contains.
The Committee, they say, cannot escape the conclusion—
1. "That Mr. Patterson, being a Senator of the United States, in August,
1867, contracted with Oakes Ames, a member o£ the House of Representatives,
for the purchase of thirty shares in the stock of the Credit Mobilier of America."
It is not exact to say that Mr. Patterson contracted for the purchase: the evidence
is that whatever he purchased, he paid for in cash, at the time of purchase,
although he did not receive any certificate.
V '
In ordinary circumstances, this distinction would not be material; but here it
is. The Senate cannot exclude from its mind the reflection that, as appears by
evidence in this Report and official. Reports to the House of Representatives,
other members of both Houses had dealings with Mr. Arnes in the stock of the
Credit Mobilier, and that, in some of those cases, the price of the stock was
to be reimbursed out of the dividends declared. "Whether that
^
fact be, or not, of importance, certain it is that reform of
6
the transaction in those cases has been made the subject of inculpation; and,
if there be any cause for such inculpation, then the different form of the transaction
in my case tends to justify me, and to show the correctness of the transaction,
and therefore ought distinctly to appear in a
judicial summing up of the whole case.
Moreover, in my case, unlike that of others, the purchase
was without any guaranty of value, or contract of reimbursement at will, with
interest.
I maintain that the transaction was rightful, correct, and proper, on my part;
that it was lawful in itself, and in no respect in conflict with my duties as
a Senator.
"
Why not? On what theory of public duty or public morality is objection to be
made to the purchase, by a Senator, of stock either in the Union Pacific Railroad
Company or in the Credit Mobilier?
Tt has, indeed, been assumed, in the course of these investigations, that a member
of Congress should not hold such property, because it may be the subject of legislation
on the part of Congress.
Is it understood, then, that Congress is to be constituted only of men utterly
destitute of property at present, and hopeless of or indifferent to its acquisition?
Doubtless you may find persons willing to enter Congress who have nothing; hut
will yon find any who do not desire to have anything? I think that would be difficult;
and if it were practicable, it would not tend to the purification of public affairs
to lay down the rule of poverty as the essential qualification of a member of
Congress. Poor men are as eager to acquire property as the rich are to increase
theirs. To constitute Congress on the theory of poverty, and of exclusion from
ail gainful pursuits whatever, supposes men engaged by vows and by convictions
of ascetic self-privation, such as prevail amona: some
religious orders, but which it is perfectly visionary to expect to introduce
into Cono-ress.
^o. It is not for the public interest that members of Congress should be without
property or the desire of it:
which would imply, of course, the being without family,
7
without local interests, without knowledge of the material concerns of the country,
without identification either with the public or the private prosperity of the
people of the United States. Such a Congress would be a mere debut-ing society
of empirical, impractical, and mischievous Communists.
In this new "Utopia we are to have no lawyers in Congress:
for it will happen, by possibility, that a lawyer should have been counsel for
somebody or some thing, who or which may, at some time, come before Congress:
in which event, if we act on the foolish premises which pervade these investigations,
it ie presumed that such lawyer is disqualified from acting as a member of Congress.
What say the members of the bar in the Senate to this theory? Are none of them
of counsel for any railroad, for instance, having possible interests in Congress?
Meanwhile, assuming that the Constitution of the United States has not yet been
amended to the effect of excluding from Congress all men who have, or desire
to have, property,—or all lawyers who have or who may desire to have clients,—let
us look at the actual facts of the situation, without hypocrisy, false pretences,
or affectation.
The malfeasance imputed to me is the purchase, in a period of four years, and
sale in the (t stock-markets of J^"ew York," of stock to the amount
of ^7,000 in the Union Pacific Railroad Company and Credit Mobilier, which Companies
might become the subject of action on the part of Congress.
I appeal to Senators to put themselves under investigation in this respect. Is
there a single member of the Senate who, during those four years, has not bought
and sold interest either in some national railway, or in some national bank,
or in some national insurance company, or in, some fraction of the public domain,
or in some mine situated on the national domain, or in something else, no matter
what, appertaining to the United States, subject to be treated in Congress? Have
they not purchased property in the District of Columbia, the value of which depends
on Congress? And how many of the Senators are there, or
8
rather'how few, who have no interest in any coal property, or any iron property,
or any foreign merchandise, or any shipping property, or any manufacturing property,
or any agricultural -property, such as live-stock, tobacco, hemp, wool, wheat—or
any material substance or thing whatsoever,'—which is liable to be seized
upon for external duty or internal impost, and changed in value, by the omnivorous
jaws of the tax power of the United States? Is not many a Senator possessed of
securities of the United
States, which rise or fall according to the daily votes of Con cress? May we
not look around on the seats of the Senators and find interests of millions upon
millions which are or may be affected by the legislation of Congress?
"
I might refer, in illustration of this question, to the time .when one half the
members of this Senate were fighting in the interest of their own slave labor,
and the other half in the interest of their own free labor: for the twenty years'
controversy, which raged here between the adverse interests of cotton-production
and cotton-manufacture, was championed on both sides by members having personal
interest in the question.
I appeal to the honorable members of the Committee:
Do not they each and all possess interests subject to be affected by their votes
in Congress? They do; they must. Por there is no object which is not subject,
either as investment or as consumption, to be affected at least by the tax legislation
of Congress.
It must be so; it ought not to be otherwise. Members of the Senate are not here
for the purpose of dreamino- over transcendental or speculative questions of
sentiment or theory: they are charged with the supervision of interests, and
the distinct interests of their respective States, as wel! as the general interests
of the United States. And it is well-it is well for the public good that Representatives
in Congress and Senators should themselves have interests in common with their
constituents and their States The theory of the Report would produce a body of
Senators as little useful for their high duties as children in the nursery.
If, m such case, there be any conflict of duty between
9
the public and private interest of the Senator or Representative, the standing
rules provide for the contingency.
I repeat, therefore,—the transaction, which lies at the bottom of this
investigation, was lawful in itself, and in no respect in conflict with my duties
as a Senator.
I shall have occasion to speak on other relations of this point in the sequel.
But I call attention now to the fact, that the Committee 'do not seem prepared
themselves to affirm that the transaction per se was wrongful in any respect,
for they proceed to qualify the proposition as follows:
2. "At rates greatly below its esteemed value."
In all the discussions of this subject the fact here alleged has been adduced
as proof of improper motives on the part of one or both of the parties to the
transaction. We cannot shut our eyes to this consideration. We are bound to presume
that the Committee inserted this qualification in an argumentative sense, to
indicate the wrongfulness of an act innocent in itself, but wrongful if done
under such cicrumstances.
' I regret to say that the circumstance thus adduced as constituting the gravamen
of my transaction did not occur, the contrary being positively established by
the evidence. "Without quoting that evidence in detail, it suffices to cite
the finding of the Committee itself, as follows:
"
The market value of Credit Mobilier stock, in August, 1867, was at par, and rose
in the next six or eight months to the value of $200 or §225 per share."
\
Now, the transaction between myself and Mr. Ames was in "August, 1867,'1
at which time the stock was at par. The Committee, while stating here that the
purchase of the stock was made " at rates greatly below its esteemed value," omit
to state that the sum paid was $8,000 in cash; that is, at the estimated actual
value of the stock. If the Committee had not forgotten this and omitted to state
it, the summary itself would have shown that my stock was hot purchased "at
rates greatly below its esteemed value."
10
In truth, as the evidence before the two Houses shows, my stock, and mine alone,
wns purchased before the stock
of the company had commenced to rise.
3. The Committee say "that he subsequently, in the
year 1869, dealt with Mr. Ames to a large amount in the stock and bonds of the
Union Pacific Railroad Company, for the purpose of profit, and disposed of the
same in the
stock markets ofKew York."
Is not this a most exasperated form of description for a
a t^—^^^—" -
single transaction, and that by no means a very considerable one./ Does not the
expression "dealt with Mr. Ames to a large amount in the stock and bonds
of the Union Pacific Railroad Company," and the further expression, "disposed
of the same in the stock markets (plural) of^ew York," tend to produce impression
of numerous transactions, and to hundreds of thousands of dollars of amount?
And yet behind these phrases of enormity there was but a single purchase of stock
to the amount of $4,000. If the Committee were not conscious of the feebleness
of the case against me, would they fall into this style of extravagance and exaggeration?
4. "With the knowledge of the character of the Credit Mobilier."
"
What was the character of the Credit Mobilier? There would seem to be a latent
implication here of something culpable in the character of the Credit Mobilier.
Certainly, if there was ai\y such thing, it was at that time wholly unknown to
me. I possessed no special knowledge on the subject. There is nothing in the
evidence,—not a tittle of proof,—to bring home to me any knowledge,
at
that time, of any thing peculiar or objectionable in the character of the Credit
Mobilier.
What was the character of the Credit Mobilier? Did any body have special knowledge
on the subject, at that hme, except its particular managers? Did any person in
Congress, at that time, impute wrongfulness of constitution, character, or objects
to the Credit Mobilier? No
^tT^81'110^ t0 Ine'110 fluch ^S^s iu proof betore the Committee. '
11
4
Nay, At this day, after three volumes of evidence on the subject have been taken
by the two Houses of Congress, has any tiling wrongful in the character of the
Credit Mo-bilier been proved? If so, it has escaped my notice.
5. ti With the knowledge of the character of the Credit Mobilier, and of its
relations to and connection with the "Union Pacific Railroad Company."
I deny that, at that time, I had any exact knowledge of the relations of the
Credit Mobilier to the Union Pacific Railroad Company, or its particular connection
therewith, and not an atom of evidence is to be found in the Report, to bring
home to me any knowledge on the subject, other than such as consisted in the
incidental recommendation of the stock by Mr. Ames.
It is extraordinary that the Committee should say that they "cannot escape
the conclusion" of my imputed knowledge in these respects, when that conclusion
is wholly conjectural and inferential, and not substantiated by any specific
fact whatever.
It is impossible not to see that the Committee are framing conclusions, not upon
any facts of notoriety existing in 1867, but-upon the investigations of the late
Congress.
It is superlatively unjust to regard the purchase of such stock by me or other
members, in 1867 or 1868, in the light of the knowledge elicited by the two Committees
of the late House of Representatives.
"
We know now that the Credit Mobilier of America is a corporation created by the
Legislature of the State of Pennsylvania, and invested with various powers of
action, in virtue of which it was susceptible of being employed, and was employed,
as a construction company for the "Union
Pacific Railroad.
But the knowledge of this fact in all its details was at that time confined to
a relatively narrow circle of persons.
I was not of that circle.
6. "And further, that he had knowledge of the interest of Mr. Ames in, and
his connection with, said companies."
I utterly deny that I had any such knowledge as could induce me to suspect Mr.
Ames of any improper relation
12
1
to those companies. There is not a scintilla of evidence in the Report to bring
home to me such knowledge, j
In the eye of all the world Mr. Ames was one of the managers of the Credit Mobilier.
He was avowedly engaged in the construction of the Union Pacific Railroad. He
was also apparently engaged in other large enterprises, as to which, however,
I had no particular information.
To impute to me a knowledge of all these various enterprises, and of their true
relation one to another, simply because of my ownership of a small amount of
stock in one or the other of those companies, and the same being recommended
to me by Mr. Ames, would be just as unreasonable and just as injurious as to
impute to the purchaser of a few shares of stock in the Erie Railroad knowledge
of or complicitly with ati the jobs and operations, public or private, of Jay
Gould and James Fisk.
Here again, as in other parts of this case, the Committee wrongfully regard things
in the light of their present information.
An able Committee of the late House of Representatives has devoted two months
steadily to the examination of these questions. That Committee, it. may be supposed,
has arrived at some knowledge on the subject. "What that knowledge is there
will be occasion for me to discuss in the sequel. Suffice it to say that that
Committee, with its examination of the general subject so much more complete
than the incidental examination made by the Committee of the Senate, as evinced
by its Report of nearly eight hundred pages, differs totally from this Committee
in its appreciation of the character and conduct of mere stockholders in the
Credit Mobilier. That Committee limits blame, if-there be cause of blame anywhere,
to the managers of that company. It expressly exempts from blame persons outside
of the management. They are not to be presumed to possess any " knowledge
of the wrongful use of its stock or of the funds of the railroad." As to
them, " it is difficult to believe that they had auy consciousness that
they were doing wrong, or saw the whole proceeding In the lio-lit in which the
Committee now state it." Such persons - thought
13
they were only dealing with their own property; they did not think they had anything
to do with the Government."
That Committee, earnest as it was, and thorouo-h in its investigations, and severe
in its conclusions respecting the managers of the Credit Mobilier, did not presume
to condemn every stockholder merely because he was a stockholder, or to criminate
him on inferences, conjectures, or presumptions, without proof, and contrary
to reason, such as are applied to me in the present Report.
7. The Committee proceed to say:
"
Also of the object of Mr. Ames in thus dealing with him was to secure his friendly
recognition of the interests of said companies, and his own interest therein,
and to influence his action as a Senator in matters of legislation affecting
the same."
The meaning of this passage is obscure, because no possible reading of it is
compatible with grammatical construction : which shows how hastily the Report
was prepared.
Does it mean to say that "the object of Mr. Ames in thus dealing with him
(me)-was to secure," &c.? Then the of which precedes the object is out
of place. Or does it mean, going back in the sentence, to say: he (myself) had
knowledge of the object of Mr. Ames in thus dealing with him was to secure, &c.
? Then the was after with him is
out of place.
In the first view of the phrase, it asserts that Mr. Ames, in thus dealing with
me, had a certain purpose. But the Report does not contain any proof that Mr.
Ames had any
such purpose.
In the second understanding of the phrase it impliedly
asserts that Mr. Ames had such a purpose, and expressly
asserts my knowledge of that purpose.
I deny that if Mr. Ames had such purpose any knowledge of it was possessed by
me. There is not a particle of proof to that effect in the evidence. There is
positive and un contradicted evidence to the contrary. The conclusions of the
Committee are all mere conjecture, inference, imputation without and against
proof.
14
In this relation let me call the attention of the Senate to
the true nature of the question.
If there be anything in the series of inferential conclusions which have been
commented upon, it is either to impnte to me guilty complicity with certain supposed
criminal acts of the managers of the Credit Mobilier, or to
impute to me the being bribed by Mr. Ames.
Either hypothesis constitutes a grave accusation of criminality.
As to the first, to impute to-every shareholder in a company guilty .complicity
by mere presumption in imputed wrongful acts of the directors, violates all sense
of reason and justice. And yet -such is the monstrous implication
of the Report.
The Senate contains in its body many of the most eminent jurists in the land.
I am sure they will not say, as this Report impliedly does, that a member of
the Senate ie to be expelled on presumption of guilty knowledge of, and criminal
complicity with, any alleged wrong committed by the directors of a railroad or
other company in •which he may happen to own thirty shares of stock.
Nay, I am assured that even a copartner is not in a criminal proceeding presumed
to have guilty knowledge of a criminal act done by a copartner of his, though
in the business of the firm: it must be proved.
Of course, and by still stronger reason, it is unjust
to presume a mere shareholder in a corporation to be guilty by imputation.
The Committee assume that my investment of $3,000 produced such enormous profit
as should have led me to suspect there was something improper in the transaction.
Surely that is forced construction. It is notorious that all speculations in
stocks are founded in the hope of large profits to be derived from a small venture.
I have little personal knowledge of transactions of this class, but I read continually
in the newspapers of immense gains being made in New York by persons who do not
invest anything, who buy and sell on time, and receive large profits by fluctuations
in prices of railway stock or boncfs. I am
15
told, also, large profits frequently accrue in the moat ordinary commercial operations;
that a freighting ship sometimes earns on a single voyage, or an importer on
a single cargo, quite as large a percentage of profit as that which was received
by me on this stock within the first year, and the payment of which seems so
suspicious to the Committee. Is it not contrary to reason to take it for granted
in all such cases,—and if the rule is good in one case it is good in all
cases,—is it not unreasonable to assume that in all such csises large profits
imply a fraudulent transaction?
Such misconstruction is specially objectionable when applied to me. Mine was
the ordinary case of a man of relatively little property, who has relations of
friendship with a wealthy man engaged in large and profitable enterprises, and
who was admitted to participate therein for a small amount as a favor. The rich
man conducts the enterprise in his own way, and in due time reports to the poor
man so much profit on the investment, the, latter having no more part in the
management of the transaction than if he were an utter stranger to it without
interest. It is familiar knowledge to everybody that such transactions are of
ordinary and common occurrence, as for instance in maritime adventures. And all
investments in banks, insurance companies, railroads, and other business corporations
are of the same character. "What knowledge of or control over the managers
is possessed by the humble holders of twenty or thirty shares in any of these
incorporated companies ? But in the investigation of the affairs of the Credit
Mobilier, the minds of men seem to have lost their balance, without which it
would be impossible to understand how the intelligent members of this Committee
should have drawn such injurious conclusions from the simple fact of the assumed
largeness of the dividends of the
Credit Mobilier.
Meantime, it is proper to say that the dividends on that stock have been ffi'ossly
exaggerated, seeing that the stock
c1 */ ^-'^—/ / ^/
itself is a total loss, and that the capital is to be deducted
from the amount of the dividends.
The Committee, in order to make out a case of exces-
16
sive profits, recite the investment of §3,000 and the payments thereon of
1868, and then pass to the payments of 1871, as if they were all one transaction,
omitting the. intervening investment of ^4,000 in 1869. Is it not inconceivable
that a Committee of the Senate should by such process of calculation and inculpation
arrive at the conclusion of recommending the expulsion of a fellow Senator?
The second branch of the accusation seems to be imputed
bribery.
On this point the Committee have the emphatic denial
of both Mr. Ames and myself. Here also the Report assumes, without proof, and
accuses on mere inference and
conjecture.
Meanwhile, the Senate knows that the Committee of the House of Representatives,
before which was taken the evidence originally referred to the Senate, was chiefly
occupied in investigating similar transactions between Mr. Ames and various members
of the House.
y"ow, that Committee, in a spirit of equity, which did them honor, report
conclusions as follows:
"
The Committee do not find that Mr. Ames, in his negotiations with the persons
above-named, entered into any detail of the relations between the Credit Mobilier
Company and the Union Pacific Company, or gave them any specific information
as to the amount of dividends they would be likely to receive further than has
been already stated. They all knew, from him or otherwise, that the Credit Mobilier
was a contracting company to build the Union Pacific road, but it does not appear
that any of them knew that the profits and dividends were to be in stock and
bonds of that company.
"
The Credit Mobilier Company was a State corporation, not subject to congressional
legislation, and the fact that its profits were expected to be derived from building
the Union Pacific road did not, apparently, create such an interest in that company
as to disqualify the holder of Credit Mobilier stock from participating in any
legislation affecting the Railroad Company. In his negotiations with these members
of Congress, Mr. Ames made no suggestion that
he desired to secure their favorable innuencein Congress in favor of the Railroad
Company, and whenever the question was raised as to whether the ownership of
thiy stock
17
would in any way interfere with or embarrass them in
their action as members of Congress, he assured them it would not.
/
"
The Committee, therefore, do not find, as to the members of the present House
above named, that they were aware of the object of Mr. Ames, or that they had
any other purpose in taking tins stock th^n to make a pronto able investment.
It is apparent that those who advanced tlieir money to pay for their stock present
more the appearance of ordinary investors than those who did not; but the Committee
do not feel at liberty to find any corrupt purpose or knowledge, founded upon
the fact" of non-payment alone. * * * *
"
The Committee have not been able to find that any of these members of Congress
have been affected in their. official action in consequence of their interest
in Credit Mobilier stock. * * * *
"
It ought also to be stated, that no one of the present members of the House above
named appears to have h;id any knowledge of the dealings of, Mr. Attics with
otheri members.
"
The Committee do not find that either of the above-named gentlemen, in contracting
with Mr. Ames, had any corrupt motive or purpose himself, or was aware that Mr.
Ames had any, nor did either of them suppose he was guilty of any impropriety
or even indelicacy.in becoming. a purl-baser of this stock. ' * * *
"
The only criticism the Committee feel compelled to make on the action of these
members in taking this stock is, that they were not sufficiently careful in ascertaining
what they were getting, and that, in their judgment, the' assurance of a good
investment was al! the assurance, they.
needed."
I respectfully submit that all these considerations apply fully to my own case,
with distinct intimation that cases like mine, where the money was advanced to
pay for the stock, (and, I add, without guaranty or promise of reimbursement,)
exhibit the conditions of ordinary investment more clearly than those cases in
which the money was not
so iidvanced. And the House Committee concludes as follows:
"
The Committee find nothing in the conduct or motives;
2
18
of either of these members, in taking this stock, that calls foianyrecommendation
by the Committee of the House."
Thus both Committees of the House exonerate individual members of the House,
to the end of attaching blame where it belongs, if anywhere, that is, to the
managers of the Credit Mobilier.
I entreat Senators to reflect, in view of all this, how
harsh has been the judgment of their Committee as compared with that of the two
Committees of the House, seeing that, as to an act of mine in some respects similar,
but with material discrepancies in its character, and done under different circumstances,
which diversities are altogether to my advantage, where the. former recommended
a vote of expulsion, the latter find nothing to condemn, or which calls for any
recommendation on their part.
(8.) Of the points in the summing up of the Eeport, nothing remains but the charge
of misstatement or suppression of " material facts, which muat have been
well known to him, (me/')
I do most solemnly deny that, in the explanations given by me, whether to the
Committee of the House or that of the Senate, there was any intentional misstatement
or sup-
7 i/ . J,
pression of facts. It is a most cruel and harsh misjudgment of my declarations
to distort and misconstrue forgetfulness of the exact nature and details of a
transaction ID stock
more than five years ago into willful misstatement or suppression.
I frankly acknowledge, and beg pardon of the Senate for, the error committed
by me in going before the Committee of the House to make any statement whatever
on the subject. Let my misstep, in this respect, be a warning to all Senators
hereafter, not to submit themselves to any criminatory investigation on the part
of a Committee of the House of Representatives.
But the error was a natural one, the result of sensitiveness to blame, which
affects most persona who bold elective offices, and are thus made subject to
what is called public opimon,-that is, newspaper crimination. I felt
19
conscious of having done no wrong, and therefore voluntarily yielded myself to
the invitation of the Committee of tlie House.
It is now in evidence before the Committee of the Senate that there were two
distinct transactions between Mr. Ames and myself, at a distiince of two years
one from the other: first, an investment of $3,000 in the stock of the
Credit Mobilier; and second, one of $4,000 in the stock of tlie Union Pacific
Railroad Company. Receipts are produced by Mr. Arnes which tend to show that
both transactions occurred. But those very receipts confound the two transactions
together, and also serve to show how-easy it was for the memory to confound the
two together, and retain distinct impression of the character of only one
of them, namely, investment in stock of the Union Pacific Railroad Company.
"
What is memory? Is it anything more than the present perception of an impression
ou the mind, which impression may exhibit there delusive 'images of things which
never existed, or defective, imperfect, and confused images of tilings which
have existed ? How few in number are the memories which can retain for years
the details of any transaction, whether affecting themselves or others? Such
memories are altogether exceptional, if any such exist. To profess to recollect
such details is a much more just cause of suspicion than to declare that they
are forgotten. All reasonable presumptions are in favor of the latter and against
the former. But the Committee reverses the rule of universal presumption, in
order to charge me with misrepresentation instead of forgetfulness.
Of the two transactions, blended and confounded together in the receipts, only
one remained impressed on my mind at the time when my attention was first called
to it in June, 1872. And that impression was fixed there,— that is to say,
that my investments had been exclusively in the stock of the Union Pacific Railroad,
and not at all in Credit Mobilier,—by the assurance, repeatedly given to
me by Mr. Ames both orally and in writing, of my not
beinff a stockholder in the Credit Mobilier. And^he said this "to others
within my knowledge, which negatives the
injurious supposition that he said it to me untruly, and by
concert in order to conceal the truth.
This impression continued in my mind, without any incident having intervened
to obliterate or modify it^ when, in December last, the matter became a subject
of inquiry before a Committee of the House. I, therefore, positively
denied holding any stock of the Credit Mobilier. If my memory had retained impression
of possessing
any such stock, there would have been no reason for suppressing the fact, while
admitting ownership of stock in
the" Union Pacific Railroad.
But the question before the Committee was of the ownership of stock of the Credit
Mobilier, and my statements, whether affirmative or negative, were made with
reference to the specific issue.
All the reasoning of the Committee to my prejudice is founded on assumed presumptions.
They allege that I denied things which I could not but know. How do they know
what I could or could not know? That is mere presumption on their part. We are
dealing with presumptions, founded on theories of human action, and referable
to the constitution of the human mind. On these premises tlie Committee act.
But I insist that all presumption of human action is contrary to the conclusions
of the Committee. If I had known that the transaction with Mr. Ames was in Credit
Mobilier should I have proceeded, according to any reasonable theory of human
action, to deny it positively, subject to have it proved against me in the sequel
? If I had remembered the existence of the receipts, should I have denied the
fact they imply, knowing that they could be produced to con-
tradicfcme? Certainly not. That denial is the most cogent Proof of my sincerity
and good faith. Remember that my first denial, in June, 1872, was made, not only
on the strength of my own memory, but also of that of Mr. Ames. How, in such
circumstances, should I doubt the correctness of
21
my impressions, either then, or when the subject came up again in the following
December?
As to the receipts, it is to be observed that the second in date, that of June
22, 1868, makes no mention of the name or nature of the stock to which it refers.
The more
circumstantial ones of February 14,1868, and May 6,1871, could not have been
read by me: that is proved by the
admitted fact of erroneousness in both, as well as confusion. Thus, the former
charges interest incorrectly; and the latter purports to receipt for two hundred
shares of Union Pacific Railroad stock, which is incorrect; and the calculations
or results do not tally with any knowledge of mine or of Mr. Ames himself. Surely,
if I had read these receipts at the time with any such attention as to impress
them on my memory, I should have sought correction or explanation of some of
those manifest errors aud obscurities on the face of the receipts. And all these
considerations are conclusive to show that my forgetfulness of the transaction
was natural, real, sincere, and not intentional suppression or denial of facts
within my knowledge and my recollection, as charged
4
by the Committee.
But it further appears in, evidence that a certificate for thirty shares of the
stock of the Credit. Mobilier, standing in the name of Mr. Ames, and indorsed
by him, had been lodged with Messrs. Morton, Bliss & Co. in New York, and
it appears that a letter had been written notifying me
of the fact.
I had and have no recollection of that letter, and never
had otherwise knowledge of the deposit of the stock by Mr. Ames. And it appears
that my particular friend, Mr. Morton, the head of the house, himself had noremembrance
of the tact, as stated by him both in a letter to me and in his testimony before
the Committee; nor, as it appears, had^Mr. Ames. It was the absence,of such knowledge,
on the part both of Mr. Morton and myself, which led me to deny before the Committee
of the House the possession of any such certificate. I did not, therefore, deny
a " material- fact which must have been well known" to me, or
suppress any material fact, or give a false account of the transaction; for the
forgetfniness of one of the incidents of a transaction, and a statement of it
founded on that for-getfulness, is not the giving a "false account" of
it: which consists only in the intentional misstatement or misrepresentation
of the fact ^ay, to have made a statement contrary to my recollection of the
facts,—that, and that alone, would have constituted false testimony. I
did not intentionally misstate, suppress, or deny any known fact.
There is a circumstance which conclusively proves my perfect good faith in all
the statements made by me concerning this transaction.
Concede that my memory has been in default; that, although forgetting the nature
of the transaction, I had really purchased of Mr. Ames, in August, 1867, thirty
shares of Credit Mobilier. It is to be borne in mind that neither then nor at
any time since had I been made an actual stockholder. Mr. Ames held the stock. "When
he made transfer, it was only transfer of his certificate, which so remained
in the safe of Morion, Bliss & Co.. N'ow, in the progress of time that stock
had become worthless; or, as Mr. Ames testifies, "This stock now is not
worth anything; that is wiped out" Kow, if I had possessed this stock, or
known that I was entitled to it, should I have left it all this time to melt
away into nothingness? Should I not have consulted with Mr. Ames from time to
time as to its value? Should I not have anticipated its decline, and proceeded
to make sale of it while it had value, and was therefore saleable, instead of
suffering it to remain
until it became worthless, whether in the hands of Mr. Ames or Messrs. Morton,
Bliss & Co.?
There is an expression in tlie Report which implies that Mr. Ames placed the
stock in the hands of Messrs. Morton,
i^liss & Co. m pursuance of arrangement with me. I have
no recollection of any such arrangement, and there is no proof on the subject.
The report also represents me aa purchasing of Mr. Ames stock and bonds ofth.
Union Pacific Railroad Com-
pany, "on two occasions," and investing therein, "in all" the
sum of $4,000, and of the placing snch -'stock and
bonds" in the hands of Morton, Bliss & Co. for sale on my account. That
statement is quite erroneous, and tends to show tiow imperfectly the evidence
was examined by the Committee. There was but one transaction for the purchase
of stock in the Union Pacific Railroad, assuming that the first transaction was
in Credit Mobilier.
The Committee also, on two occasions, take pains to say that my stock was sold
in the stock markets of New York. Apart from the exaggeration of the expression
stock markets, in plural, it may be pertinent to inquire why any stock of mine
should not be sold in New York. Where should it be sold? In Alaska? The Committee
also charge sale through my bankers. Is there anything criminal in that? If any
one happens to be a holder of railway stock or of bank stock, must he hawk it
about for sale in person ? I do not understand why these immaterial and commonplace
incidents are made to figure in accusation.
The Committee, in order to convict me of misstatement, take up the explanations
given to the Committee on the 14th of February, of the reasons why, when it was
first suo:a:ested to me that I held stock of the Credit Mobilier,
00
I had contradicted the assertion; they then treat these explanations as if they
were a repetition of that contradiction; and thereupon, overlooking the fact
that on the receipts being exhibited to me I distinctly recognized, my involuntary
and unconscious error, the Committee
t/ t/
charge me with suppression of facts, which acts were already communicated in
the most explicit terms, not only to them, but to the Committee of the House.
Again, it amazes me to see that, by such processes of reasoning, a Committee
of the Senate should come to the conclusion to
recommend the expulsion of a Senator.
While not believing, in June last, or even in January,
that my first transaction with Mr. Ames had been a purchase of stock of the Credit
Mobilier, for the sufficient reasons already stated, that no trace of the transaction
re-
24
mained in my memory, and that my forgetfulness was .confirmed by repeated statements
of Mr. Ames to me and others, nevertheless, on subsequently seeing the receipts,
I yielded to the conclusion that. it must have been so, at least in the understanding
of Mr. Amcs, It is singular, meanwhile, that the Committee themselves admit that
Toom for controversy on that point still exists, not affirm-ico- it as proved,
but saying only "there is little reason to -<loubt"on the subject.
Then there is doubt. And yet, on these confessedly doubtful premises, the Committee
base a positive charge of falsification.
"
Whether I received the letter which, as it would appear, Morton, Bliss & Co.
addressed to me on the 12th of May, 1871,1 do not know. All I can say is that
I have no recollection of it. Is it not in the observation of every Senator that
letters come to him the reception of which soon passes from his remembrance?
The Committee inquire:
"
Did not the rumors come to others who had embarked in the same enterprise, of
differences and difficulties that had arisen between the Companies, and which
at a later
date led to public debate in both Houses of Congress, come to him?" G
I reply: H'o,I am not aware that any such rumors came to my knowledge calculated
to shake my confidence in Mr.
Ames, or to lead me to know or suppose anything wrong of the Credit Mobilier.
^ What were those rumors? A suit brought by James Fisk,Jr.,iu July, 1868, against
the Union Pacific Railroad and the Credit Mobilier? Why should that disturb me
or any other person? How could any of the doings of
TT^8 ^ Jr ) help or harm me? A sllit b^^ ^ TT MCCOTnb against Mr. Amea, in Kovember,
1868 ?
now could I have knowledge of such a suit a year before its ulstitution ? And
I do not believe its relation to the questions ow before Congress was known to
anybody except the
^m08 t. ir coun8eL If there was anything in these
IT.^ y of attention' and if it bad been known to ' L could not ^e affected my
interests or my conduct.
25
I had purchased of Mr. Ames absolutely and for cash I had not reserved any right
to rescind the bargain, give up the stock and take back my money, as had been
(Lie by Mr. Grimes, Mr. Alley, and other members of Cono-ress.
The Committee, in calculating the amount of dividends received by me, proceed
on premises which are not very apparent, and arrive at conclusions which do not
correspond with the statements of Mr. Ames, and which it is impossible for me
to verify. In this way, partly by calculation and partly by conjecture, the Committee
infer that large profits were derived from the Credit Mobilier. I think the Committee
exaggerate these profits. But it seems to me that it is a fact unbeard-of in
human affairs, that the receipt of large profits,—real profits, not a gift,—on
a stock transaction should be assumed to be proof of fraud, to the end of the
expulsion of a Senator. But the extreme unreason-ableness of this line of reasoning,
on the part of the Committee, has already been abundantly demonstrated.
1'3'ext, the Committee infer, conjectu rally, according to the accustomed process
of reasoning which pervades their Report, concerted efforts of both parties to
conceal the transaction,impelled by consciousness that itwas something more and
other than au ordinary business affair. I deny the concerted effort, and I deny
the imputed inducement
to such concert.
^ __
It is one of the infirmities of members of Congress,—I confess it with
some sense of shame, on my own part,—to shrink from discussion of their
private affairs. We know by painful experience that it does not matter how innocent
any private transaction of ours may be: we are sure that the most innocent transactions
will be so blackened by
inventive malice as to make us seem to be guilty, though. pure as the angels
in heaven. With most public men in. the United States, therefore, the great solicitude
of life is to avoid censure, and when censured, to lighten the force of the blow
as much as possible by reticence and by concealment. I suppose few men, at the
present day. would have the courage to do that which was done, lu such an
emergency, first, by Alexander Hamilton, and afterwards by Daniel Webster, that
is, when harassed by misrepresentations or exaggerations of acts of their private
life, to advance boldly to the face of the world, to disclose all the facts frankly
and defiantly, and manfully to demand of their countrymen absolution of infirmities,
or approbation of misrepresented acts of real honor. But may I not repeat, that
in thus shrinking from discussion of my private affairs I do but partake in the
common condition of public men in the United States at the present time? I utterly
deny that it proves or implies consciousness of wrong.
I confess, therefore, that in June, 1872,1 desired not to be misrepresented on
this subject while a candidate for re-election to the Senate by the State of
N"ew Hampshire. I fully believed that I bad not held any stock of the Credit
Mobilier, and to say so was the shortest way to dispose of the question, and
without which it would be necessary to enter into long discussion of the history
of the Union Pacific Railroad and the Credit Mobilier. I stated the fact as I
understood it to be. Mr. Ames confirmed me in this understanding, both orally
and in writing, and there is nothing in these incidents to justify the condemnatory
conclusions of the Committee.
The Committee continually assume that there was something unlawful or improper
in the relation between the Union Pacific and the Credit Mobilier Company, which "had
become matters of public notoriety, and must have become familiar to Mr. Patterson;
and while he was in the receipt of dividends from his purchase of Credit Mobilier
stock, he was still dealing with Mr. Ames in the stock and
bondsof the w^ Pacific Railroad Company."
W^th knowledge of anything wron^ in the conduct of the Credit Mobilier toward
the Union Pacific Railroad, it
would have been absurd for me to buy stock in the latter at the risk of thus
losing all my investments and being involved in discreditable transactions. To
have done so would have been an act of folly rather than of criminality.
hel-e was n0 suc" notorious knowleda-e wtthiu my
27
reach. I do not believe any such knowledge was possessed by the members of the
Committee at that time. Here, as throughout the Report, the Committee are judo-ing
me, not in the light of the knowledge of these transactions possessed by men
in the years 1867 and 1868, but of the knowledge, or supposed knowledge, imparted
to us by these investigations. If the supposed misconduct of the Credit Mobilier
was a fiict so notorious to all the world that a Senator must be presumed to
be cognizant of it, why did Senators and Representatives wait so many years to
be put on inquiry by one of the newspapers of ^Tew York? Why did they not institute
investigation of their own motion, as it was their duty to have done, if they
knew that the Government or the Union Pacific Railroad was being defrauded by
the Credit Mobilier? "What rationality would there be in the recent investigation,
if the facts were already known to Congress?
The Committee profess to find in my statement before the Committee of the House
of Representatives, and in that before this Committee, "a contradictory
relation of the transactions" between myself and Mr. Ames. I protest against
this ungenerous construction of the relation of the two statements, the first
of which was a representation of the facts as they lay in my memory, and the
second a correction of the first statement in the light of writings
produced.
The Committee say of my statement of the 14th of February, that "being in
possession of the certificate of stock transferred to him by Ames, he still ignores
the fad of the purchased 1 cannot but express astonishment that the Committee
should so misread or misconceive my testimony. I then said expressly, "It
results from the admission made of the genuineness of my signature that Mr. Ames'
statement as to the investment of the ^3,000 is sustained, and that mine is erroneous." And
an admission to this effect pervades, either in expression or in implication,
the whole of my statement of the 1.1th of February.
With similar misconception of the relation of my several
statements one to another, the Committee continue to place in juxtaposition the
statements made by me ou mere memory, and those made by me in correction of memory,
after seein^ the receipts, which substituted written papers in
place of my recollection. The critical questions here are questions of memory.
But forgetfulness or misrecollection is the ordinary fact in human affairs: recollection
is the exception, aud not the
rule. Does no memory but mine suffer a fact to drop from it
after the lapse of years? Does not the memory often fiiil in regard to the incidents
of every year, month, day, and
hour?
In this very Report examples occur of forgetfulness
even of material incidents. Thus, in one line, the Committee speak of the "l:2th
of May,'5 and soon afterwards, in the same sentence, the Report refers to " said
6th May."
In the same Report another incident, which had already been stated three times
as having occurred in August, 1867, is then described as having occurred in "April,
3867."
Shall it be said that these examples of the uncertainty of the best constituted
human memories ;ire of immaterial facts? But so also are some of the acts of
forgetfulness detected on my part: for it is another quality of the human memory
that it does not invariably select for retention the most important facts, and
that, with impartial indifference, it fails to retain both important and unimportant
facts.
There is another example of forgetfulness in this Report. It states, as we have
seyn, "that Mr. Patterson, being a Senator of the United States, in August,
1867, contracted with Oakes Ames, a member of the House of Representatives, for
the purchase of thirty shares in the stock of the Credit Mobilier of America,
at rates greatly below its esteemed Villue." ISowthia statement is erroneous
in the most critical point. It forgets (it would not be proper for me to say,
misstates or suppresses, in the spirit in which the Report accuses me,)—it
forgets, what the evidence fully
proves, find what the Committee themselves had expressly found, that the market
value of this stock at the time of purchase was at par, and was paid for in cash
at par, and not at "rates greatly below ita esteemed value." The'con-sideration,
if it have any force at all, and whether it have any or not, is an irregularity
of the memory of the Committee, which unconsciously and erroneously transports
to my case a fact not appertaining to me, but appertaining
only to members of the House of Representatives who purchased at a later period,
in December or January.
There is another incident in the Report, which admonishes us to distrust the
human memory and not hastily to assume that an act of for^etfulness is an act
of falsehood.
0
It is an example of the pi-oneness of the mind not to receive permanent impression
of facts at the time when they occur, and of the facility with which they may
slip from
the memory. On the 14th of February, I spontaneously stated to the
Committee a fact of which I was previously ignorant, and the existence of which
I had therefore denied, namely, the
4
deposit of stock in the Credit Mobilier for my account and benefit with the firm
of Morion, Bliss & Co.; and which fact also Mr. Morton had been ignorant
of until that time.
Nyw, although the statement of this communication of Mr. Morton was of some importance—quite
as much so at least as many other matters which figure in these investigations—and
although the particular matter did occupy much of the time of the Committee—yet
it expressly appears m
the sequel that "the memory of the members -was not ^ pressed- with the
very material point of the statement, namely, verification, by letter, of the
fact of the deposit of
the certificates of Credit Mobilier in question with Morton &Co, and the
reason assigned why the fact did no im
p.ress itself on the memory of the Committee 13 that the
details of the certificate itself" were not given at the same time. That
is a satisfactory reason: the human memory needs the aid of circumstances, of
collateral facts, ofvisi-
ble signs, to support and fortify its action. And the ex-
so
planation applies to my memory as well as to that of the
Committee. .
This condition or quality of the human memory is illustrated at every page of
the testimony taken in theae investigations by the two Houses: it is not merely
in material thino-s where misstatementor concealment might have an object,' but
in a multitude of things absolutely immaterial, that so many of the witnesses
err from time to time, when they trust to the unaided memory in reference to
dates, amounts or other details whatsoever of the particular
transaction. I have no personal experience of courts of justice, or of
the course of inquiries of fact by testimony elsewhere; it has never happened
to me until the present occasion to be called on to testify in person but once,
and that before a Committee of the Senate: if it were otherwise, I might have
learned to trust less confidently to mere memory, and should perhaps have abstained
from speaking on the subject until after making thorough search for writings
or other means of refreshing memory or bringing the facts back to my remembrance.
Nevertheless, and although I testified here in sucb circumstances of technical
inexperience and of disadvantage, it is impossible for me to believe that the
Committee would have so cruelly misconstrued my unintentional and involuntary
errors, but for the -prevailing morbid state of the public mind and the insensible
influence of epidemic malaria of accusation and of misconstruction, which poisoned
the atmosphere during the late session of Congress
Friendly relations with Mr. Amep, produced by our having been brought together
in a voyage connected with public service, were the origin and soie inducement
of the transactions, which, simple and indifferent enough in themselves, have
been exaggerated into political events of magnitude.
When those transactions became the subject of outside commentary for the first
time, my own recollection of their character was confirmed by the other party
to the trans-
31
action, and also by the only third person who possessed
any knowledge on the subject, my business friend iu New York, Mr. Morton..
I expressed, therefore, the fixed impression on my own mind, in declaring that
it was stock in the Union Pacific
Railroad Company, and not iu the Credit Mobilier, which I had purchased of Mr.
Ames.
It deserves to be borne in mind that at the time when I paid to Mr. Ames $3,000
for the purchase, as he now says, of stock in the Credit Mobilier, no certificate
or other evidence of ownership passed between us. Mr. Ames expressly Ustifies: "We
did not talk anything about the Credit Mobilier; we did not talk about anything
of that 'sort." When, at a subsequent date, he delivered to me, in. June,
cash as dividend on account of stock, the name of the stock not being mentioned,—and,
in February, proceeds of bonds of the Union Pacific Railroad Company,— and,
as it seems, took receipts from me,—it was natural for me to suppose that
these payments were in settlement of the transaction, as being the completion
of the sale of whatever stocks had been purchased with the three thousand dollars.
There is nothing in the fact of large returns within a year to indicate that
the stock purchased was Credit Mobilier rather than Union Pacific Three years
then elapsed without any transaction between us, except the investment of $4,000
in stock of the Union Pacific Railroad. It was that incident which remained fixed
in my mind, and occupied it to such degree as to constitute
impression and belief that the stock of the Union Pacific Railroad alone had
been the subject of our negotiation.
I promntly yielded to conviction of my error, and publicly declared it after
Mr. Ames had produced to the Committee the receipts, which showed that he bad
certainly treated me as the purchaser of stock in both companies, although such
had not previously been my understanding: of the transaction. . ,
I, not a man of business, and relatively "nfamlllarwrth commercial aflairs,
had, in the confidence of friendship,
bought stock of Mr. Ames, a prosperous man of business, leaving its management
to him, as so frequently happens between friends, one of whom is not accustomed
to gainful pursuits, while the other is. I supposed that the two ' acts of purchase
were both in one class of stocks. I signed receipts it seems, with not sufficient
attention to their contents to remember them, which receipts either omit to mention
the particular stock or confound the two stocks too-ether in one settlement.
I cannot admit,—I confidently appeal to the conscience of all the many
persons who, not business men themselves, have thus confided in a business friend
to justify me in denying,—that any misrecollection of the actual facts,
any want of recollection on the subject, should be charged as willful falsification
or suppression of the truth.
«
There still remained the question whether I had ever become the actual holder
of stock in the Credit Mobilier. If it were so, I was wholly unconscious of the
fact. Remember that at the time when these declarations were made by me I had
not seen the receipts since they were signed, and had utterly forgotten their
existence. Even the production of the receipts did but confirm me in this impression;
for the latest in date, that of May 6, 1871, expressly says: " there are
still due on the transaction thirty shares of stock in the Credit Mobilier of
America." Of course, the stock had not then been delivered to me.
The Committee devoted much time and care to tlie examination of the various relations
of this question : which examination,—for what cause, or by what process
of reasoning, it is impossible for me to conceive,—seems to have produced
on the minds of the Committee impressions unfavorable to me. The result of the
examination was to elicit cancluaive proof tliat no certificate,—even admitting
a transfer not consummated to constitute a certificate,— ever had been
delivered to me or had come into my possession until at the very time when I
voluntarily communicated that fact to the Committee. This proof consists in the
exhibition by Mr. Morton of a press copy in his posses-
sion of a receipt, in the handwriting of Mr. Ames of the following tenor, under
date of May 12, 1871, namely:
"
Received of Oakes Ames two Union Pacific income bonds, (Nos. 1355 and 1356,)
for one thousand dollars each, and certihcate (No. 338) for thirty shares of
stock in the Credit Mobilier of America, for Hon. J. W. Patterson and to be accounted
for to him. *
"
MORION, BLISS & Co."
Mr. Ames had so entirely forgotten this fact as to state positively that he had
delivered the certificate to me in Boston. But my own recollection was confirmed,
and his
negatived incontrovertibly, by the proofs.
I disclosed to the Committee the main fact, and, as it seemed to me, the only
one of any possible importance, the instant it came to my knowledge in February.
I respectfully submit that, in the protracted examination of Mr. Morton, Mr.
Ames, and myself, regarding the tenor, and the time and place of deposit, of
this certificate,—in the undue importance which they thus attributed to
it,—and in the conclusions to my prejudice which they found upon it,— the
Committee are not justified by the facts themselves, and have, unintentionally
of course, done me the most serious
wron?.
^^ m J '
I regret sincerely to he thus compelled, in my own justification, to comment
on the Report. It is true, as stated oy the chairman of the Committee in debate
on Saturday the 1st instant, that the Committee are not "prosecutors" in
this case; but their Report is the only formal accusation against me; it embodies
charges in a much more impressive form than any allegation of a mere prosecutor;
it is the Judgment of a Committee presented to the Senate; and as
such, it combines prosecution, accusation, and J"^111^ unless its recommendations
be reversed or rejected 5y me
Senate. No justification of my actions, no defense ot my
honor, is possible at the present stage of the ^estloD,we in the form of response
to that Report. If therehadbe^
time and opportunity to debate the subject w^^ such debate would have commenced
with the icsoiuno y
3
34
posed by the Committee as the immediate subject of action for the Senate. The
discussion, from beginning to end, would have been in effect, if not in form,
the single question —whether that resolution is sustained by the reasoning
of the Committee and is justified by the facts in their Report. We have a pregnant
example of this before us in the pending debate regarding the case of Senator
Caldwell:
which is, at the outset, presentation of report by the chairman of the Committee
of Elections and Privileges, with oral reasons in its support by him and other
Senators,—contradiction of those reasons by Senators in opposition,—and
a responsive argument in close by the chairman of the Committee.
I reiterate, therefore, earnest entreaty to the members of
the Committee not to take umbrage because of my doing that which is of the very
necessity of defense, that is, endeavoring to show the fallacy of the reason
ings of the Report,—deducing from it arguments in my vindication,—in
a word, saying in this memorial that which it would be competent, proper, and
even indispensably necessary for me or any other person to say, if debating the
resolution of the Committee before the Senate.
I would fain believe, as once before suggested by me, that the indifference to
the subject expressed by the chairman of the Committee on two occasions in the
Senate, that is, on the 1st and 3d instant, is indicative of a sentiment of regret-fulness
at the severity of the Report,—so different from the action of the two
Committees of the House of Representatives, and of the House itself in reference
to members of Congress who had purchased stock of the Credit Mobilier from Mr.
Ames, and so much in contrast with the action of the House in reference to Mr.
Ames himself.
It h^a been my principal aim in what precedes to discuss the particular points
of the evidence taken by the Committee of the Senate, and of their reasoning
tbereon, as applied to me individually, with only occasional passing allusion
to the general subject, as developed in this Report and in the two Reports made
to the Houae of Representatives.
But reflection on the whole subject, in its more general relations, suggests
some important considerations confirmatory of my perfect innocence in the transactions
inculpated by the Committee.
The times in which we live are distinguished by the exhibition on all sides of
a spirit of industrial and commercial enterprise, as particularly manifested
in the advanced state of agriculture, mining, and manufacture, and especially
of the means of commercial intercourse and transportation, both by land and sea.
We are the witnesses to a most imposing spectacle of large ships, constructed
of iron and moved by steam, which throng, as it were, both oceans. Not less imposing
on land is the spectacle of canals and railways, which place in such ready communication
the remotest parts of the earth. Add to this the marvels of telegraphy, and especially
of submarine telegraphy.
Of all these prodigious enterprises the greatest esistin or in connection with
the United States. Nothing but the immensity of the amount of commercial and
intellectual intercourse between the United States and Europe could have led
to the laying of the three or four great lines of telegraphic cable which traverse
the abysses of the Atlantic ocean, and are occupied with the constant transmission
of thought from the shores of America to those of England, France, Germany, Italy,
and Spain. Independently of this, the modern world has borne witness to three
gigantic works of construction, the Canal of Suez, the Tunnel of the Col de Prej
us, and the Union and Central Pacific Railroads, the noblest of which is the
particular work of the United
States. When the annexion of California to the United States,
with possession of Oregon, and of the vast interior regions of North America,
had opened our eyes to the perception of the fact that we had become a grand
Continental Power, second as such only to Russia, conceptions of some means,
of ready communication between the distant western and eastern extremities of
the Republic began to germinate in the minds of the statesmen of the United States.
1 or
36
many years nothing practical seems to have resulted from those ideas. At length,
however, when the late civil war, by the great forces of laud and sea which it
called into action, and by the enormous pecuniary resources which it was found
we could command, had communicated to us a vivid impression of our national strength,
it was then determined by Congress to lose no time in doing what had so long
rested only in project,—that is, the establishment of a line of uninterrupted
railway communication from the city of New York to the city of San Francisco.
Congress might well "have done this work itself: perhaps it would have been
better for the country if it had done so. The addition of a few millions more
or less to the aa-sreffate thousands of millions of the existing war
00 0 '-
debt would have been scarcely felt among the actual burdens of the country, and
would not have materially affected our credit in the money markets of Europe.
But Congress decided otherwise, and chose to invite private enterprise to undertake
tins great work under the auspices and with the aid of the Government.
To this end the Government proposed to aid the undertaking by granting to the
corporation in fee a certain portion of the public domain along the line of its
construction, and also by loaning to it a denned amount of the bonds of the Government.
"
Who on these premises and with such aid would undertake the work? No poor man
could do it. What rich iman would undertake it, with perception of unknown and
inappreciable financial and mechanical obstacles in his path, —w.ith imminent
peril of losing his whole fortune in the experiment—and with certainty
that if he were successful, and should reach such profits on the enterprise as
its magnitude and the risks attending it required in order to constitute just
compensation to him as a capitalist, the beagles of envy and jealousy would not
fail to fasten on his heels
and dog him persistently at every step, and especially in the Congress of the
United States?
:Such a man was found,—a great capitalist, the son of his
37
own works, a man of resolution and courage adequate to grapple with such an herculean
task. ^ot a man of refined sensibilities, it may be; not a man of elaborate speech;
not a man of nice forms in action; not a buok m<m; a man of deeds rather than
words; a great doer in the business of life. Of such stamp are they who win victories
in the field of battle, who accomplish mighty undertakings ID civil life, and
who, age after age, change the face of the world by their hardy management of,
or their resistance to, the material forces of Nature.
Such a man is Oakes Ames, who dared to take 'this great enterprise on his shoulders,
and to march under its burden unwavering, like Sampson with the gates of Gaza.
But how should this work be done? If we look back on it, in the light of our
present knowledge, to condemn,
let us do the same in order to approve.
It is fully in evidence, in that most searching inquiry
instituted by the Committee of the House of which Mr. "Wilson was chairman,
that, at the time when the Union Pacific Railroad was undertaken, few persons
had faith in the profitableness of the proposed undertaking. It required robust
intellect and indomitable will to enable any person, at that day, to seize hold
of the enterprise and
push it forward to successful consummation.,
One other great conclusion is satisfactorily established
by the Report of that Committee, that the work could not have been done by the
corporation of itself, as such, but only by the means of a special construction
company or construction companies, whether inside or outside of the Union Pacific
Railroad itself. That Report abounds with evidence on this point, which it would
be out of place to
repeat here at length.
Impelled by these considerations, the undertakers ac-
quired possession of a corporation entitled the credit Mobilier of America, and
made that serve as their construction company. , „ „ -i-r,,nn The
Government had placed in the hands o^ the Union
Pacific Railroad Company specific means with which to
defray the expenses of the work, to wit, bonds and land-grants, and it authorized
the Company to contract additional indebtedness in its own name to the same end.
Was it unlawful for the Railroad Company to contract to deliver all these means
of construction and equipment to a construction company? That is rashly assumed
by those who blame me and others for the possession, real or imputed, of any
stock in the Credit Mobilier. But such a transaction was not deemed to be unlawful
then, and since that time has been carefully considered, and in effect, under
certain conditions of qualification, approved, by Congress.
In the act to incorporate the Texas Pacific Railroad Company, passed March 3,
1871, it is enacted as follows:
"
SEC. 20. That it shall not be lawful for any of the directors, either in their
individual capacity or as members of an incorporated or joint stock company,
to make any contracts or agreements with the said Texas Pacific "Railroad
Company for the construction, equipment, or running of its road, or to have any
interest therein; and all such coutriicts or agreements are hereby declared null
and void, and all money or property received under such contracts or agreements
may be recovered back for the benefit of the company by any stockholder."
"
What is prohibited here is a contract between the directors of the Texas Pacific
Railroad Company and the same persons as directors of the attendant construction
company, as in the case of the Credit Mobilier.
"
Was such a contract invalid by any existing general law? That is one of the questions
to be tried in the suit
against the "Union Pacific "Railroad and others, provided for by the
late act of Congaess.
But so late as the year 1871 it could not have been the opinion of Congress that
such a contract was unlawful by any general law; for, if so, there would have
been no occasion, by special enactment, to declare unlawful the making of such
a contract by the Texas Pacific Railroad Company.
Morever, the expediency, as well as the legality, of action by construction companies
is recognized" in the supplementary act of May 2, 1872, which, while regulating
the issue of "construction and land bonds" by said company, enacts
as follows:
"
The aforesaid bonds and the authorized capital stock or tlie proceed tliereof,
shall be applied only tor the wr-pose of securing the construction, operation,
and equipment ot the contemplated railroad line, under lawful contracts, with
such parties, and on such terms and conditions as said company may deem needful;
and for the further purpose of purchase, consolidation, completion, equipment
and operalin^ of the other roads, as contemplated by said act and specified therein,
being a part of the aforesaid railroad line, and for the expenses necessary and
incident to tlie works authorized thereby.''
In view of all this, the least which can be said is, that the storm of reprobation
aroused on the subject of the Credit Mobilier is ill-considered, precipitate,
and destitute of justice and reason.
The pendins; discussion forcibly reminds me of that incident in the history of
England, when Parliament lost con-
i/ " '
trol of itself for a while under the influence of popular clamor against the
alleged misdeeds ofClive, Hastings, and Impey in. India, and was brought to its
senses by the eloquent improvisation of Erskine, who demanded that the Government
should awake to the conscience and the logic of tlie situation;—that it
should either restore India to its native masters, or cease to persecute the
individual British
conquerors of India.
So, in the present matter, if Congress would have, the
Pacific Railroads cease to exist, if they desire to obliterate that munificent
work from the face of the earth, let them say so; but if not, the country must
take the work at its cost: remembering that deserts are not convertedinto flourishing
fields, or mountains tunneled and leveled oy dilkiiwte speeches, or with gloved
hands, or with superfane
sensibilities; but by men of the temper whlcbG.oa,_ marked out for such tasks.-of
the temper which_bne
could be capable of subjugating, of civilizing, o due n^ to culture the forests
and the deserts, which consti u ed the original inheritance of the people of
the United States.
40
But, says the clamorous voice of what is so absurdly called public opinion,—and
which is nothing but the noisy chirrup of the grasshoppers in the field where
the silent cattle are gathering their nutriment for the joy of the farmer,—the
parties concerned in the Credit Mobilier made prodigious gains at the expense
of the United States.
The statement is unfounded and the conclusion still
more so. If there was such promise of profit in this enterprise,
why did not Congress undertake it of itself, and reap that profit in alleviation
of the taxations of the people of the United States? "Why did not other
capitalists undertake the enterprise? It was competent for them, if they had
seen fit, to anticipate Mr. Ames and his associates, and to have taken exclusive
possession of the enterprise by sub-
b
scribing for the stock.
Nay, more: Mr. Ames and his associates did not endeavor to monopolize the stock,
on the contrary, he manifested the greatest anxiety to obtain assistance from
others, to which end he earnestly solicited their participation. The statement
that he makes on the subject, as contained in the Senate Report, completely negatives
the current fallacy which attributes to Mr. Ames and his associates the spirit
of grasping monopoly and extravagant profit. He entreated hundreds to join him,
who refused to do so on any terms. He obtained the participation of many others,
such as Mr. Alley and Mr. Grimes, by contracting in writing to take back their
subscription if they should require it, treating it as a loan at ten per cent.
interest, with guaranty against loss. He had faith in the enterprise: his embarrassment
was to satisfy Congress or anybody else, in Congress or out of it, that the possible
profits of the enterprise were equal to its hazards.
^ In fact, with all his wealth and courage, Mr. Ames did sink under the enterprise,
finding himself compelled to suspend payment for a while, in consequence of some
unfriendly legislation on the part of Congress, which was always one of the ordinary
perils of the undertakiinf.
41
^ow,what profit should have recompensed the undertakers of an enterprise of this
magnitude? It would be
ridiculous to suppose that the ordinary profits ofbankino-manufacture, or commerce,
would be a satisfactory induce meut to impel any person possessed of a capital
of five or
ten millions of dollars to stake it all in a railroad, subject to the caprices
of Congress.
"
What is the profit made by the great railroad undertakers, such as Cornelius
Yanderbilt, Thomas A. Scott, J. Edgar Thompson, and Horace F. dark, who work
with charters derived from States? Would any of those persons be content with
ordinary interest, as the only return for the investment of a large fortune in
an apparently hazardous railroad enterprise? "We know they would not:
and, in order to be just, we must judge by the same standard the parties who
constructed the Union Pacific Railroad by means of the Credit Mobilier.
The discussions on this subject are assuming extraordinary profits, because of
the large return in the first years of the undertaking; but'this line of reasoning
overlooks the fact, that the value of the stock of the Credit Mobilier, as an
investment, disappeared when the construction of
the road was completed. Well, therefore, might impartial lookers-on observe,
with
amazement, the intense agitation which prevailed during the last session of Congress
over the fact of stock in the company, to the paltry amount of sixteen thousand
dollars, being supposed to be held among ten members of Congress.
I appeal to the conscience of Senators to say whether,
in comparison with other incidents within their knowl^ edge, of the disappearance
of hundreds of thousands ot Mars in the lobbies of Congress, on more than one
occasion, there is not strange exaggeration in reference to tne
present transaction? . i-)„,,« o-The two Houses of Congress have
been occupied during
the entire session with investigation, agitation, anddiscu_ sion on the subject
of these trivial investments, to sucn
42
degree that Congress has hardly done anything else, except to pass the various
appropriation bills, leaving unacted on matters far more important than any possible
relation of
the Credit Mobilier. How has this happened? The explanation is plain to
the eyes of all men.
During the late presidential election the clamor of the
hour, raised by the opponents of the Republican party, was pretended corruption
in federal affairs. The loudest notes of that cry were but attempted diversion
from the public censure of municipal corruptions in the city of^Tew York, and
the relation of those corruptions to the two great parties -which divide the
country. Of course, in a presidential election, the chief point of aim for attack
was the President of the United States, and incidentally to that were his leading
supporters in Congress. He passed unscathed through that tempest of calumniation.
What is more to the point, he was not frightened. But others were. And thus the
opponents of the Administration saw before them a tempting field of action. They
had but to continue the cry of corruption, and all the more loudly in view of
the little there was left of the subject-matter. They had found a raw in the
public mind, and they did not fail to apply the point of the lash to that spot.
The interests and influences, defeated by the re-election of the President, continued
agitation with such capital as they had, which was nothing but one hundred and
sixty shares of the Credit Mobilier. And they it is who have cast the baleful
shadow of their disappointment and resentment like a sunset eclipse over the
expiring months of the last Congress.
And what a wild rage of self-destruction and of sell-dishonor has during those
months occupied the halls of Congress: as if, in the hasty eagerness of premature
self-defence on the one hand, and the passionate cry of corruption on the other,
members were determined to commit hari-kari for the particular gratification
of their defeated
political enemies of the conventions of Cincinnati and Baltimore!
43
Never in the history of the United States or of Europe
did it occur that causes so weak produced agitatio^o intense in the higher circles
of the Government.?f ^
were a great cataclysm of corruption and fraud which had overwhelmed us.hke the
South Sea Bubble in England or the Mississippi Bubble in Prance, there might
be s^ome thing to contemplate with sentiments of respect for the public weal,
and of consequent severity of inquiry into imputed or suspected corruption on
the part of men in
high station,—men hitherto of blameless lives, of unstained honor, and
some of them representatives of the semi-sovereign States of the Union. But no,
it is nothing of that kind. It is only a bagatelle of stock of the Credit Mobilier
utterly insignificant as inducement to votes adverse to the public interest,
which was not purchased or owned with any such thought, and with no proof existing
that the fact had prejudicially affected any measure before Congress.
And yet for such a cause as this each House of Congress has given itself up to
the functions of a tribunal of inquisition, exaggerating the most innocent or
indifferent acts into crimes, disseminating mutual distrust and ill-will, severing
long-cherished friendships, and laboring to find in members subjects of inculpation,
which, if found, would serve no purpose but to discredit and disgrace the institutions
and the people of the United States.
I say, the people of the United States; for the Senators and Representatives
are the elected agents of the people;
their virtues and their vices are the common stock of the nation; and if the
Senators and Representatives are higher than the people, so much the more are
the latter depressed
in estimation by the errors of the former. What good has come of all this? It
tends, indeed, to
show that the true character of the Congress of the United States is exceptionally
exalted and pure, when the ownership of a few shares of Credit Mobilier by some
of the
members so horrifies their colleagues of the Senate and the House. But when,
as in my case. ^fulness of _QC^ dents of the transaction, and this forgetfulnessJUst^d
bv ^e correspondent forgetfulness of others-or the taiiu
44
&
rather to retain in the mind a clear recollection of the distinction between
two transactions connected in their nature and blended together in fact,—when
such an error of memory is made to assume the proportions of a false statement,
and is unjustly condemned as such, it may well be doubted whether inquiry so
resulting can serve to promote public morality either in Congress or in the body
of the people of the United States.
Most assuredly no trustworthy precedent is created for the admonition of others,
no useful example is set, in a Report which selects me alone for condemnation,
and which is made at so late a day of my senatorial services that it cannot be
acted on, and is therefore susceptible of being regarded in all future time as
an act of partial and personal discrimination to my prejudice.
It is not by such a spasmodic proceeding as the censure or the expulsion of a
member that the character and the action of Congress can be placed above reproach.
But the means are easy if Congress really desires the end. It needs only to pass
a law visiting with the severest penalties of champerty and maintenance all agency
or attorneyship about Congress or the Departments founded on contracts of contingent
compensation; to drive away from the' lobbies and the halls of Congress all adventurers
trading on their pretended influence with Senators and Representatives; and.
to establish a body of parliamentary solicitors subject to the discipline of
Congress, in the same way that counsellors and attorneys are subject to the supervision
of the courts before which they are permitted to plead. Do this, and you will
cut up by the roots all corruption and all facility of corruption in legislation,
while you provide to meet a public necessity for which there is no legitimate
provision now,—that is, the honest and open advocacy of private interests
which may require legislative consideration.
As to the present inquiry, let the Senate look the facts frankly in the face,
to see that the effect of the Report, when considered alongside of the Reports
made to the House, and of the action of the latter, is to make me the single
victim of proceedings in Congress instituted profes'
45
sedly to meet accusations of^he public Prpqa" — ..
from an a<-t of larceny or burglary, and pu^edTnS whip and spur of that same
public Press
Congress, in the morbid state of mind produced by these investigations, has seemed
to suppose that sensational paragraphs in the newspapers, which are pleasant
reading to-day and are forgotten to-morrow, constitute the iudff ment of the
people of the United States, and so it seemed to have been thought that Congress
must undertake the great process of self-purgation in the ingenious form of
suicidal self-immolation. But the excitement was here and not among the people
of the United States. The moment Congress adjourns, reaction commences in favor
of the martyrs to this superfluous agitation in Congress. Gentlemen the most
inculpated are received with triumph when they return to their respective States.
The Administration suffers no prejudice, either from the panic terror of the
accused or the equally panic terror of the sincere amouff
* 0
the accusers and triers.
Thus, we were told that the investigations regarding the Credit Mobilier were
to affect injuriously and perhaps defeat the Republican party in my own State
of l^ew Hampshire, when the contrary effect is indicated by the electoral returns
from that State. And indications of similar reaction have occurred in other States.
In conclusion, let me say that I have reviewed the Report with anxious purpose
to discipline myself to a candid examination of its contents,—discharging
my mind
of all natural feeling of resentfulness on a view^ of the severe conclusions
of the Committee;—penetrating into the
recesses of my own conscience, to judge my own actions and motives without reserve
or mercy,—in a word, discussing t^e case impartially and without bias,
favor, or affection, as ifit were a question of history relating to some third
person of another age or of a foreign country ;-and on such a re-aspect of the
facts, I do solemnly appeal from the condern^ ^tory opinion of the Committee
to the better Judgment
^Senate itself, of my countrymen, and o^^^