MARCH 2020

MARCH   2020
The Lawyers Carve Up the Golden Goose


Friday, August 12, 2011


A leader in the Democratic Party is a boss, in the Republican Party he is a leader.
Harry Truman
I would descriibe it as a generation gap. When James Pendergast won big, betting on horse named Climax, he invested the winnings in a bar, restaurant and hotel in St. Louis’s West Bottom neighborhood (middle, above). The town was then divided between the uptown establishment Republicans, and the working class Democrats who were litterly on the bottom land. James' business was so succesful that he became one of the town’s most powerful councilmen. His competition for Democratic votes was Joe Shannon who controled the police department. But, rather than fight, “Big Jim” cut a power sharing deal with Shannon. To get what he wanted, James Pendergast's  first instinct was always to negotiate.
“You use a saw to shape wood, not a hammer.”
James Pendergast. 1892
James hired his youngest brother, Tom (above), as cashier and bookkeeper at the “Climax” in the early 1890’s. He also schooled Tom in local politics, lecturing him that, “The important thing is to get the votes.” In 1900 James secured Tom the position of Superintendent of Streets. Tom immediately hired two hundred new employees, all loyal goats, as Pendergast supporters were called. And every goat voted the way the Pendergasts told them too. Then, in November of 1911, at just 55, big brother James died of kidney failure. Tom stepped in to fill his brother’s seat on the council, but resigned after just five years. The position was no longer powerful enough for him. Tom’s first instinct was always to go for his opponent’s throat..
“Today, politics may be our friend, and tomorrow we may be its victims.”
Owen D. Young. Chairman of General Electric. 1922-1939
In 1916 Tom Pendergast had himself appointed to the leadership of the Jackson County Democratic Party, headquartered in a two story yellow brick building (above, left)  at 1908 Main Street. With the votes from the Irish and Italian neighborhoods in his pocket, Tom drove Shannon’s people out of the police department, making him the invisible hand in writing of the new city charter, adopted in 1925. “Boss” Tom could now manipulate both the city and county governments, both the Democratic and Repubican parties, from behind the scenes, following a simple rule; The important thing is to get the votes-no matter what.”
“Those who are too smart to engage in politics are punished by being governed by those who are dumber.”
Plato 400 B.C.E.
Boss Tom’s name never had to appear on another ballot. As one St. Louis writer noted, “Pendergast never did hunt ducks with a brass band. It has always been hard to tell what he is doing, but easy to tell what he has done the day after the election.” Tom helpfully described the methods he had learned from his older brother. “Every one of my workers has a fund to buy food, coal, shoes and clothing. When a poor man comes to old Tom's boys for help….we fill his belly and warm his back and vote him our way.”
“Politics have no relation to morals.
Niccolo Machiavelli. 1532
James "Blackie" Audett explained the methods Boss Tom developed for himself.  “My first job in Kansas City was to look up vacant lots…we would give addresses to them vacant lots. Then we would take the address and assign them to people we could depend on – prostitutes, thieves, floaters, anybody we could get on the voting registration books. On election days we just hauled these people to the right places and they went in and voted…”
“The political machine triumphs because it is a united minority, acting against a divided majority.”
Will Durant.
With the arrival of the Great Depression, Boss Tom did not wait for Hoover to sympathize with Kansas Cities’ 38% unemployment. In November of 1930 the town voted a $40 million bond issue, for a “Ten-Year-Plan”. What Kansas got for its investment in the future was the “Power and Light Building”, still a landmark in KC., as well as a new City Hall, the Jackson County Court House, a new Police Headquarters, a new Municipal Auditorium, and several schools. When the KC “Star” described all these new buildings as “Pendergast’s concrete pyramids”, Tom merely smiled. And the hundreds of workers who found work building Kansas City's future, smiled too. The truth was that Pendergast Ready-Mix Cement was probably his only entirely legal business. But what brought Tom Pendergast down, was another legal business; political consultant.
“There are no true friends in politics. We are all sharks circling, and waiting for traces of blood to appear in the water’
Alan Clark. 1974
Since 1922 the State of Missouri and 137 insurance companies had been sparing over rate increases for fire insurance, regulated by the state. The difference in any individual policy was small, but after 15 years the amount impounded while the courtroom wrangling continued was up to $10 million. Then, suddenly, the state agreed to a settlement, giving the insurance companies $8 million in higher rates, and the right to future increases. In May of 1938 Republican Governor Loyd Stark (below, right), a Tom Pendergast pick (below, left), ordered an investigation. This investigation uncovered that the insurance companies had delivered a half million dollars in cash to Tom Pendergast as a “political consulting” fee, just before the settlement. Now, since Pendergast had no direct authority over the insurance commissioner, this fee was legal. However it was politically embarrassing. And in order to avoid the embarrassment, Boss Tom had not declared it on his Federal income tax. And that was illegal.
“The hardest thing about any political campaign is how to win without proving that you are unworthy of winning.”
Adlai Stevenson.
The end came quickly. On April 7, 1939 Boss Tom (above) was arraigned on two counts of tax fraud. On May 22, 1939 he pled guilty. He paid a fine and served 15 months in prison, and was never involved in Missouri politics again.
“An election is coming. Universal peace is declared, and the foxes have a sincere interest in prolonging the lives of the poultry.”
George Eliot.
The reformers patted themselves on the back, and the Republicans reveled in their triumph over Democratic sin. Governor Stark (above) hoped to use the toppling of Boss Tom to propel himself into the U.S. Senate. But in 1940, he lost a nasty contest to Harry Truman, who had been a long time Pendergast man. After that Stark was through in Missouri politics. When Boss Tom died in January of 1945, his funeral was well attended, and the only thing that changed about Missouri politics was the names on the ballots.
“If you can’t convince them, confuse them.”
Harry S. Truman.
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Wednesday, August 10, 2011


I hate to admit it but Marcel Proust was probably right. Even people who know history tend to repeat the same idiotic mistakes their grandfathers made, who were, of course, repeating their grandfather’s mistakes - Etc. ad naseum. As proof of this dismaying lack of a learning curve in humans I give you the noble sacrifice of the Right Honorable William Huskisson, Minister of Parliament (above). If Christ died for our sins, then William Huskisson died to prove that the human species are morons.
On September 15, 1830, the first steam powered passenger rail line opened between Manchester and Liverpool, England. Riding in the inaugural train from Liverpool was Mr. Huskisson, stewing over a political beef he had with the then Prime Minister, the Duke of Wellington. (Get it? Stewing over Beef Wellington?) When the train stopped at Parksdale station, 17 miles outside of Liverpool, to take on water, Huskisson disembarked, the better to harass the Duke, who was riding in the last car of the same train. As he reached through that car’s window to shake the reluctant Dukes’ shoulder,  the inaugural train out of Manchester roared through the station at the unheard of speed of 25 miles per hour. Mr. Huskisson froze in a panic. The Duke tried to pull Huskisson into his car, but the westbound train was faster than the Duke. It crushed Huskisson’s foot and pulled his leg under the wheels and further mangled it. His death later that night in great agony made headlines all across England - Train Kills Man. And William Huskisson was the first.
In the 175 years since it has become a given that to be killed by a train you have to be an idiot. I mean, it’s not as if trains swerved and hit people at random. Pretty much you have to be on the train tracks to be hit by a train. See tracks, look for train. See train, get off tracks. But according to the U.S. Department of Transportation some 2,618 stupid people in this country were killed by trains in 2010.
But are people stupider for being hit by trains, or are the rest of us stupider for not noticing the consistency with which people avoid crossing guards and ignore flashing warning lights or who look but don’t see a huge locomotive barreling down upon them? Could it not be that perhaps having several thousand tons of steel, which may take a mile to stop, rushing through our neighborhoods “at grade” for the last 170 years constituted a fundamental design flaw? Perhaps being hit by a train is never entirely the victim’s fault. After all, just how smart are engineers who don’t allow for human stupidity in their designs?
I bring all this up to point out that the geniuses who operate the lovely Golden Gate Bridge in San Francisco have finally decided to maybe build a suicide barrier on their lovely bridge. The idea is to put something between the potential suicide and the empty space hundreds of feet above the cold ocean water besides a simple waist high railing.
Since the lovely Golden Gate opened on May 27th, 1937, an average of 20 people a year have jumped from the lovely span. That makes around 1,369 people who were so stupid they thought suicide was romantic, and didn’t connect a graceful swan dive with hitting the cold water at something around 75 miles per hour. At that speed water behaves much like concrete. It can't get out of the way fast enough to remain fluid, and if you haven’t seen a jumper who has hit concrete, I highly recommend you avoid seeing one or being one.
The original design for the bridge had a higher barrier but Joseph Strauss, who was the head designer, was a short guy, and he rejected it because it would have blocked his view. The next serious proposal for a barrier on the pedestrian walkway did not come until the 1970’s, after some 600 people had already clambered over the railing. Of course, once the idea was suggested the Metropolitan Transportation Commission, which operates the bridge, and the citizens of San Francisco who own it, they all slapped themselves in their collective foreheads and said, “Well, duh!”  Unfortunately, they did not.
The idea was rejected. And rejected again in 1998. And the arguments against a barrier were just….well, stupid. Said the opponents, “If people can’t jump off this bridge, they’ll just jump off some other bridge”. That may be true, but so what? Do we NOT put STOP signs at an intersection because if people don’t collide there, they’ll just crash at some other intersection?
Said the unadorned bridge's defenders, “Why should everybody pay for a barrier to save the lives of a small minority?” By that reasoning, all those suicides were sacrificed so a pint sized engineer could have an unobstructed view of San Francisco Bay -  on those rare days when the fog did not obstruct everybodies' view. It all seems particularly silly, when you remember that the members of the M.T.C. always agreed to a barrier to prevent pedestrians and bicyclists from falling onto the roadway, but remained opposed to one to prevent people from jumping or falling the other way, into the bay. Stupid.
Finally, on August 20, 2010, the M.T.C. accepted the design a steel catch mat, which will hang 20 feet below the bridge. So why did stupid San Francisco suddenly get smart? Well, in 2006 filmmaker Eric Steel released the ultimate snuff film, "The Bridge", staring the lovely Golden Gate Bridge. Over three years Steel had sought to capture the many moods of the bridge by just pointing a camera at the bridge and letting it run. In doing so he had also inadvertently captured 19 suicides on film. When his film was released the public image of the lovely bridge was not so lovely anymore. Of course, the M.T. C. has decided that the $45 million to build the suicide barrier "will not come from bridge toll revenues".   Isn't that the kind of thinking that originally led to those 1,379 deaths?
 Well, given enough time, Mr. Huskisson, perhaps your death will have meaning after all. Someday.
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Sunday, August 07, 2011


I can not imagine the shock and shame felt by William Ralston when Mr. Colton handed him the telegram from Professor King. His shock, and probably anger at this previously unknown (to him) interloper who was questioning his dream, must have been overwhelming. But this was quickly followed by reports from the London newspapers detailing the bizarre Americans who bought diamonds in bulk. Wrote the London Times, “The purchasers were evidently unacquainted with precious stones; they purchased without reference to size, weight or quality, the lot including diamonds, rubies, emeralds, etc. to the value of over $15,000.” Shortly there after King himself arrived in San Francisco, with full details of the salted claims. Ralston wasted no time in moving to minimize the damage to his reputation.
First he made arraignments to repay every investor in full. That million dollar hit to his personal finances was huge, but in the days before the Securities and Exchange Commission, and their meddlesome regulations, tens of millions of dollars in investments could vanish with a mere whiff of rumor against the reputation of one man. If the Bank of California was to have any future, then Ralston had to at once restore the full trust of men like the Baron Rothschild. It was at moments like these that it should be clear that a lack of government regulations is a severe hindrance to the trust which makes larger international investments possible.
Next Ralston moved to get his money back. He hired the best detective he could find, the long time San Francisco Captain of Detectives, Isaiah.W. Lees. Over thirty years of service, Lees had managed to avoid any taint of corruption while rising to the top of a department awash in payoffs and political favoritism. Lees had championed innovations such as photographing all arrested suspects, and originated the rouges gallery of their pictures. Lees was now granted a leave of absence from the department, and Ralston provided him with an expense account to find out everything he could about the Great Diamond Mountain con men.
Lees immediately set out for Europe and found, as he suspected, that there were many along Tulip Street who recognized the photographs of the two odd Americans from their 1870 expedition. And by tracking the aliases they had used in Amsterdam against shipping manifests Lees could confirm they had sailed – in both 1870 and 1872 – from the Canadian port of Halifax. A railroad had recently been completed, connecting the U.S. State of Maine with Nova Scotia, and that seemed the obvious path they had taken to avoid American ports.
Although John Slack was was nowhere to be found at the moment, the Pinkerton agency had easily tracked down Philip Arnold, living amongst the 2,000 residents in his home town of Elizabethtown, Kentucky. Far from hiding, Arnold had followed the example of William Ralston. He had invested his ill-gotten gains in an troubled bank run by Thomas Polk, now renamed the Arnold and Polk Bank. The move saved the small town from financial ruin. Arnold put the rest of his money into the safe in his two story brick Italiante home at 422 East Poplar street, in the hills on the north side of “E”town, along with 500 acres of farmland where he bred horses, hogs and sheep.
Arnold and Slack were both indicted for fraud in San Francisco, but Philip Arnold had no intention of giving himself up. His family connections in Hardin County, Kentucky, and his donations to local politicians were only reinforced by the interviews he gave to the “Louisville Courier”; “I have employed counsel, a good Henry Rifle” he announced. The feisty talk assured public opinion would materialized firmly behind the local boy who had outfoxed the robber barons, but Arnold also hired a real lawyer or two. Philip Arnold was dug in like a tick on a Kentucky mule, and Ralston was not going to get him out without an expensive, exhausting and embarrassing court fight. Rather than see himself mocked and derided in Kentucky courtrooms, the robber baron decided to cut a deal.
The details were never made public, but it seems the California banker settled for about a third of what he had lost, about $200,000. In exchange Ralston dropped all claims against the Kentucky con man.
But the bad news was just starting for the Magician of San Francisco.The capitalist sharks smelled blood in the water.  In August of 1875,fellow robber baron and close personal friend Senator William Sharon, broke a promise to Ralston and sparked the collapse of the Bank of California. Try as he might to avoid it, William Ralston ended up just like Henry Comestock, and he made the same exit The day after they took his bank away, William Ralston was found floating in San Francisco bay. His funeral was attended by 50,000 people. They loved him, they just weren't willing to lend him any more money.
Charles Lewis Tiffany, the man who had vouched for the value of worthless diamonds and sapphires, reestablished his reputation in 1878 by buying himself a French Legion of Honor Award. He died in 1902 at the age of 90. He left behind an estate valued at $35 million.
Shortly after paying Ralston to go away, Philip Arnold opened a hardware store at 58 public square in “E” town. It seems he had gotten considerably more than half of the money from the diamond hoax. Unfortunately, he would not live long to enjoy it. Just five years later, on Tuesday, August 20, 1878, Philip Arnold got into a bar fight with Henry Holdsworth, a clerk at a competing bank. In a story that would be familiar to anyone who watches the local news, Holdsworth left the bar and returned a few minutes later with a double barreled shotgun.
According to the Breckenridge News from Cloverdale, Kentucky, Arnold was just leaving the bar when he saw Holdsworth approaching. Arnold pulled his pistol and fired twice. He missed both times. Holdsworth fired one barrel, missing Arnold but hiting two innocent bystanders, one of them in the neck. Hodsworth then ducked behind a tree. From there he emptied the second barrel at Arnold, hitting him in the shoulder and “lacerating it terribly”. Not dissuaded, Arnold fired three more rounds, again missing Hodsworth, but this time hitting a local farmer named John Anderson, in the gut, and killing him. Since everybody was now empty, the gun fight was over, and the tally was seven rounds fired, one antagonists wounded, one innocent bystander killed and two more noncombatants injured - a typical gun fight.
Philip Arnold did not die quickly. The 49 year old lingered for almost a year, finally dieing of pneumonia on August 8, 1879. His funeral was one of the best attended in the history of “E” town, and his monument on the rolling slopes of the Elizabethtown Cemetery is one of the tallest. But over time memories of Philip Arnold have shifted and every October the residents of “E”town stage the “Philip Arnold Dead Man Rolling Bed Race”- to raise money for charity, of course. Contact the E-town Heritage Council for details. The final joke is that Arnold's hardware store has become a law office.
In a footnote - Arnold's nemesis, Henry Hardworths, was not satisfied with having mortally wounded Arnold. He also sued him for $7,600 for injuries suffered in the bar fight. He lost. But that figure came up again in August of 1884 when Henry was arrested in New Orleans for passing bad checks  in "E" town, totaling $7,000.
Arnold's partner in crime, John Slack was eventually tracked down in St. Louis, where he was working in the affiliated professions of cabinet and coffin maker. But he missed the mines of his youth and continued his profession in the silver strike boom town of White Oaks, where he became “one of the oldest and most universally respected citizens...” of Lincoln County, New Mexico. He died in 1896, at the age of seventy-six years, two months and six days, leaving an estate of $1,611.14.
The only conventional hero in our tale seems to have been the geologist and professor, Clarence King (above). He had uncovered the scam, and its fame had made him the first director of the United States Geological Survey. But there was, of course, another side to the rock hound, a human side. In 1888 he married Ada Copeland, an ex-slave who had moved from Georgia to New York. What was dark about this love story was that King hid his true identity from Ada, telling her that his name was actually James Todd, that he was a black,man and his profession was actually that of a Pullman Porter. For the next 13 years he continued this divided life, black man James Todd at home, and world renown geologist Clarence King while away from home. They had five children, and Clarence finally revealed his true identity to poor Ada and the children in a letter he wrote in December 1901, as he lay dying in Arizona.
If you want to see the Diamond Mountain that has no diamonds, find Diamond Wash Draw, in Moffat County, Coloardo, about one mile south of the Wyoming state line and a quarter mile east of the Utah state border. The flat topped mountain in front of you is Diamond Peak. And the square mile scrub brush plain to the north is the scene of the Great Diamond Hoax of 1872. If you can get there, you too can pull a diamond right out of the ground. And when you do you will understand why William Ralston had been so willing to believe, and why capitalism has always depended upon a mix of fantasy and a fraud to survive.
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