When the Republican state convention assembled on July 28, 1875, its first informal ballot virtually selected the successor of Cushman K. Davis in the governorship. The distinction fell on John Sargent Pillsbury, who had proved his capacity for public affairs by ten years’ service in the state senate and on the board of regents of the university. A successful business career, a reputation for inflexible integrity, a power to select from varied propositions the one which could be carried and worked, and a keen insight into human nature gave him an influence with legislatures and the people rarely equaled. Two reËlections were accorded him as by common consent. The varied events and incidents of his six years’ service are so related that, while forming a whole, they may be thrown into convenient groups.
After the harvest of 1875 Governor Davis appointed a commission to investigate the locust devastations, and placed on it Allan Whitman of St. Paul, a man of science. The report, by giving in simple language an account of the vermin, their manner of propagation, and the stages of their growth, suggested the principles upon which their ravages might be restricted, and, when new invasions did not take place, actually repressed. Early in the season of 1876 Governor Pillsbury issued a proclamation commending to the farmers of the infested districts the advice of the commission to attack the “hoppers” immediately after hatching. By digging ditches around fields and gardens not infested, the vegetation could be protected. For the rescue of crops somewhat grown he recommended a simple apparatus which got the popular name of “hopperdozer.” It consisted of a piece of sheet-iron twelve feet long or more, turned up on the back edge and ends. By means of ropes attached to the front edge, at or near the ends, it could be hauled by men or animals over the surface of the field. The upper surface of the pan, smeared with coal tar, imprisoned the insects till they could be scraped out at convenient intervals. By such simple devices considerable areas of crops were rescued from total destruction. They were of course useless after the appearance of wings on the creatures; and the havoc of the previous season was repeated, particularly in the southwestern counties. These Governor Pillsbury visited in person, and, after witnessing the ruin and distress going on, called for contributions in relief. The response was immediate and generous, and with the aid of his wife the governor attended personally to the distribution. The damage extended in this year to twenty-nine counties south of Otter Tail Lake and west of the watershed of the Mississippi. The worst of all was that at the close of the season these counties were “literally peppered” with locust eggs. The outlook for the coming season caused deep anxiety. The legislature of 1877 authorized a loan of $75,000 to be advanced to farmers for seed, and empowered county commissioners to levy a tax for the destruction of locusts and their eggs. In the spring the hatching began in alarming volume. Governor Pillsbury, in the expectation that the expense would be reimbursed, distributed 56,000 pounds of sheet iron and 3000 barrels of coal tar for “dozers.” Where these were diligently operated the damage to crops was reduced.
On April 10, 1877, in response to an expressed desire of various religious bodies, Governor Pillsbury appointed the 26th of that month as a day of fasting, humiliation, and prayer: “In the shadow of the locust plague,” said he, “whose impending renewal threatens the desolation of the land, let us humbly invoke for the efforts we make in our defense the guidance of that hand which alone is adequate to stay the pestilence.” The day was observed in a goodly number of congregations, but there was no great and general humiliation of the people, and there was no immediate evidence of supernatural interference. The infernal brood grew wings and began their aerial excursions in various directions. In the last days of June the swarms began rising high in the air and taking flight on different bearings. In the course of sixty days all had so risen and flown out of the state to unknown destinations. Although they had wrought damage equal at least to that of any previous year of their residence in Minnesota, the state as a whole harvested the greatest wheat crop in her history,—30,000,000 bushels, of sixty-three pounds to the bushel.
In spite of the ruin wrought in so large a portion of her territory, and of minor and ordinary losses, the period in view was one of prosperity. The population, which had risen from 439,706 in 1870 to 597,407 in 1875, increased to 780,773, according to the census of 1880. The wheat crop, which had been 30,000,000 bushels in 1877, touched 40,000,000 in 1880. The most striking evidence of material development is seen in railroad building. In the four years 1873-76 but 87 miles had been added to the 1900 miles of construction in the eleven years ending with 1872. This mileage was increased in the six years beginning with 1877 to 3278; 446 were added to the St. Paul and Pacific (now Great Northern) system.
How a corporation left in the panic year 1873 in a condition of hopeless bankruptcy was resuscitated and put into vigorous life is a story which the reader will be interested in. The “Division roads,” the main line from St. Paul to Breckenridge and the branch to St. Cloud, had gone into a receiver’s hands in August, 1873. The “Extensions” to St. Vincent and Brainerd, of which 140 miles in detached portions had been built, remained in the control of the stockholders till October, 1876, when they were turned over to trustees of the bondholders, according to the terms of the company’s contract with them. These trustees employed as their general manager the same gentleman who for three years had been receiver of the Division roads. The stockholders having given over the task of completing the roads and retaining ownership, it remained for the bondholders to decide between putting in several more millions of dollars to complete and equip the roads, or giving up and letting the property go to sale under pending foreclosure proceedings. Had they taken the former course and selected honest and capable agents, they would have not merely escaped great losses but realized large profits. The greater portion of the bonds of the system, over $17,000,000, were owned in Holland, and they had been placed by their holders in the hands of a syndicate of Dutch bankers to be controlled for the common interest.
The drift of affairs had been watched by three deeply interested persons. Donald A. Smith, residing at Winnipeg and representing that city in the Dominion parliament, was chief commissioner of the Hudson’s Bay Company. That company had many millions of acres of land in Manitoba, and was desirous to obtain railroad connections through Minnesota with the outside world. He particularly desired the completion of the St. Vincent Extension. Another was Norman W. Kittson, an old associate of Sibley in the fur-trade and politics, still interested in the Red River trade. The third was James J. Hill, who had come from Canada to Minnesota as a boy of eighteen in 1856. He had been in Mr. Kittson’s employ in his Red River business, had built up a rival line of steamboats and barges, and made it for Mr. Kittson’s interest to take him into partnership. These three men had journeyed up and down the Red River till they knew every foot of the stream and the lands drained by it. Early in 1874 Mr. Smith asked Messrs. Kittson and Hill to collect for him all the information accessible in regard to the St. Paul and Pacific system, its lines completed or unfinished, its terminals, equipment, land grants, and in particular the stock and bonds. The consultations which followed were fruitless. “There seemed no way to get in.”
Two years later, when it became evident that the Dutch bondholders were bound to realize what they could and let the properties go, there appeared a way to get in. 1876 was one of the grasshopper years in Minnesota. The crop was light and prices were low. Rates and fares were so high as to discourage railroad traffic. The net earnings of $300,000 on the system were a drop in the bucket compared with the interest charges of nearly $2,000,000. In March, 1876, Mr. Hill and Mr. Smith were again in consultation, and resolved on an effort to obtain control by buying all, or nearly all, the bonds held in Holland. Delays and discouragements postponed action. It was not till May, 1877, that Mr. George Stephen, president of the Bank of Montreal, was induced to consider taking a hand in the deal. In September, after a visit to Minnesota, he went to England in full expectation of enlisting the necessary capital, the Dutch committee having accepted a conditional offer of cash for their holdings. To his surprise Mr. Stephen found no English capitalists willing to send good money where so much bad money had gone. To all appearance the project was a failure. The associates, however, learning that the Dutch were still fierce to sell, submitted to them in January, 1878, a proposition to buy their bonds at agreed prices and pay in the bonds of a new company to be formed, which should buy the properties at the now impending foreclosure sales. As a “sweetener” they were willing to throw in $250 of six per cent. preferred stock with every $1000 bond of the new company.
In the articles of agreement signed March 13, 1878, the Dutch committee agreed to this proposition and consented to extend the time of payment for their bonds six months after the last of the six foreclosure sales. For their 17,212 one thousand dollar bonds, including coupons for unpaid interest, they accepted $3,743,150. The associates bought large amounts of “minority bonds” at similar figures. As they agreed to pay interest on the bonds of the new company at seven per cent., they were empowered to take immediate control and operation of the completed lines and to resume construction on the St. Vincent Extension, whose completion was greatly desired. On May 23, 1879, the St. Paul, Minneapolis and Manitoba Railway Company was organized, and at the foreclosure sales in the following month bought all the franchises and assets of the expiring St. Paul and Pacific Railroad Company, including those of the Division lines. Mr. James J. Hill at once became the general manager of the roads, and began a career of railroad operation with few if any equals in the country. Better times had come, but it was mainly the vigor, economy, and discipline of the management which soon swelled the earnings into millions.
The great financial exploit of the “associates” was followed by tedious, exasperating, and costly litigation. About the time of the foreclosure sales in June, 1879, Jesse P. Farley, who had been receiver of the Extension roads and general manager of the Division lines, brought suit in the district court of Ramsey County against Messrs. Kittson and Hill to recover from them one third of all moneys, securities, and effects which were accruing to them from the operation. In his complaint Mr. Farley alleged that “in the summer of 1876” a parol agreement had been made by the defendants and himself to undertake jointly the purchase of the bonds of the two railroad companies, the three to share equally in the net proceeds. In his testimony, he deposed that the two defendants had no knowledge of the great opportunity until revealed by him at the time mentioned. It was because of his intimate knowledge of the affairs of the companies, of his understanding of railroad finance, and his long experience as a railroad manager, that they were unwilling to make any adventure without his coÖperation; and, to induce him to enter into the contract, they agreed to consider his knowledge and skill equivalent to the money they would severally procure. This part of the bargain was to remain a secret. The defendants denied that any such contract had been made, or that any conversation in relation to such an agreement had ever been had. They had been familiar with the condition and finances of the companies long before the time of the alleged contract. The district court found in favor of the defendants, as also did the Supreme Court of Minnesota on appeal. The Supreme Court, however, appears to have considered that there was a contract between the parties, but that it aborted when in the late fall of 1877 the “associates” were balked in the effort to borrow money in England with which to buy the bonds for cash.
Encouraged by this recognition of a contract, Mr. Farley brought suit in the United States District Court for Minnesota in December, 1881, setting up substantially the same allegations. Defeated here, he took an appeal to the Supreme Court of the United States, which in 1887 remanded the suit to the Circuit Court for a novation of proceedings. The printed pleadings, testimony, exhibits, and arguments fill more than five thousand octavo pages. The Circuit Court held with the defendants that no contract had been made, and that the plaintiff, standing in the relation of a trustee, could not honorably or legally have embarked in any such enterprise.
When Farley’s appeal reached the Supreme Court of the United States, in October, 1893, that tribunal sustained the decision of the Circuit Court so far as it denied the making of the alleged contract. The plaintiff had not proven his allegations, and his story was inherently improbable. The court had no occasion to pass on the impropriety of an agreement never made.
In his inaugural address of 1870 Governor Austin mentioned as a notorious fact the frequency with which county treasurers retired from office with much more wealth than they possessed at the time of their elections. To secure this office, caucuses and conventions were packed and votes secured by methods little short of outright bribery. But there was no response from the legislature. It was not till Governor Pillsbury’s second term that the legislature of 1878 yielded to his urgent recommendations and passed the act providing for a public examiner. It was made the duty of this officer to supervise the bookkeeping of all state banks and institutions and all state and county auditors and treasurers. He was authorized to prescribe correct and uniform methods of bookkeeping. He was required to visit all these institutions and officials without previous warning, and verify and inspect all the moneys, assets, and securities held by them respectively. His powers extended to railroad companies, so far as the exaction of gross-earnings taxes was concerned. The first appointee, Henry M. Knox, performed the duties with such intelligence and industry as to place the state under lasting obligations. In his last message (1881) Governor Pillsbury expressed his satisfaction over the operation of the law by saying: “No single act of legislation in this state has ever been productive of more good in purifying the public service than the creation of the office of public examiner.”
The penalty for homicide in the first degree had, from the beginning of organized government in Minnesota, been death without alternative. An act of March 5, 1868, laid on the trial jury the duty of deciding whether the convicted murderer should suffer death or imprisonment for life. Governor Davis in two messages strongly denounced this leaving the penalty for murder to the caprice of juries, citing a case in which one of three convicts equally guilty was put to death, while the others received a sentence of life imprisonment. A tragical incident brought the attention of a later legislature to the matter and caused a return to traditional policy. On September 6, 1876, eight men from Missouri, armed and mounted, rode into the village of Northfield in Rice County. Two of their number entered the bank and ordered Heywood, the cashier, to deliver the money. On his refusal they shot him dead and wounded his assistant. Securing a small amount of booty, the robbers passed out to find their companions engaged in a fusillade with citizens who had found arms and chosen points of vantage. One unarmed citizen had fallen, and two of the bandits had dropped dead from their horses. The survivors rode away with all possible speed, firing at citizens who showed themselves on the streets. After a pursuit of some days, four of the bandits were surrounded in a swamp near Mankato. One was killed and three brothers named Younger were captured. Two had evaded pursuit and escaped from the state. Upon arraignment the three Youngers pleaded guilty, and, as there was no occasion for a jury, received sentences of life imprisonment. They were model prisoners. One died in 1889, another committed suicide in 1902, and the third was pardoned in 1903.
The political campaign of 1878 in the third (the Minneapolis) district, was diversified by a personal contest of more than local interest. The Republican candidate for representative in Congress was William D. Washburn, who had been an aspirant in 1868, but declined the candidacy because of the great defection led by Ignatius Donnelly. The Democrats, doubtless according to an understanding, made no nomination, thus virtually throwing the party vote over to Mr. Donnelly, who had been named as the candidate of the Greenback Labor party. Ignoring national issues, Mr. Donnelly appeared as the champion of the Minnesota farmers oppressed by the railroads and the Minneapolis Millers’ Association. It was charged and widely credited that this organization was fixing the prices of wheat at every railroad station in the state. This it was doing by direct dictation to buyers, and also indirectly through the making of grades. There was in use for inspection and grading a small cylindrical vessel of brass with an attached scale beam, which the farmers were told could be so manipulated by a practiced hand that it would yield three grades of wheat from the same bag full. It was charged that the association buyers not only undergraded, but also reduced the prices for lower grades out of all just proportion. Mr. Donnelly never had a finer opportunity for the exercise of his unequaled powers of ridicule and invective. He denounced his opponent as the willing tool of the corporations and the Millers’ Association. He perambulated the district haranguing great crowds, whom he convulsed with scornful tirades upon “the swindling brass kittle.”
The “brass kittle campaign,” however, resulted simply in reducing the normal Republican majority of the district from 10,000 to 3003 votes. But Mr. Donnelly obtained a majority of nearly 500 of the country vote. When Congress met in December, 1879, Mr. Donnelly appeared as a contestant. He claimed that the count had gone against him by reason of illegal ballots, of bribery, and of the colonization of voters. The House committee on elections lingered long in their investigation, partly because it was diversified with an episode which for the time attracted more interest than the contest itself. A letter addressed to the chairman of the committee, Springer of Illinois, made him an offer of $5000 to keep Washburn in his seat. The authorship was later fixed by a special committee of investigation on one Finley, a friend of Donnelly. They did not find that Mr. Donnelly had inspired the letter or had known that it was to be written and sent. The alleged object, of course, was to so incense Springer against Mr. Washburn that he would immediately swing his committee for the innocent contestant.
Still it was a Democratic House, willing, according to abundant precedent, to seat its partisan contestant if any plausible explanation could be invented. On the last day of the session two reports came in from the committee on elections, each signed by five members. The committee had arrived at no conclusion. The House ordered the reports printed and recommitted, and that was the last ever heard of the contest. Mr. Washburn served out the term with great satisfaction to his constituents, and was accorded two reËlections by majorities which nobody had occasion to question.
Ignatius Donnelly thus closed his career in national politics. He appeared later in two or more state legislatures, and was editor of several short-lived weekly newspapers. In early life he had published a small volume of poems and some prose essays in which he gave assurance of literary ability. His occupation as statesman gone, he now turned to authorship. In the winter of 1880-81 he composed a geographical romance, entitled “Atlantis, the Lost Continent.” He dressed the ancient classical legend in such attractive garb as to interest a great body of readers, serious and other. Many editions have been published. This work was followed by another, similar in character, under the title of “RagnarÖk.” The author elaborated the ingenious theory that the mantle of drift covering large portions of the northern hemisphere had been landed where it lies, when the earth at some time crossed the orbit of some great meteor. This fascinating book was also widely read. Mr. Donnelly next took up the study of a question which had already been among his recreations, that of the authorship of the plays and poems of Shakespeare. His “Great Cryptogram” of a thousand octavo pages contains the results of “an incalculable labor, reaching through many weary years.” In the first part of King Henry the Fourth, Mr. Donnelly professed to have discovered the key to an involved cipher showing that Francis Bacon, Nicholas Bacon’s son, had a mysterious connection with that work, although making no clear and direct claim to its authorship. There was a bewildering array of “root numbers” and “modifying numbers,” beyond the understanding of the wayfaring man. No hidden secrets were revealed by the ingenious and complicated computations, and no additions to historical knowledge were obtained. But Mr. Donnelly only claimed to have made a small beginning of a great work left to future investigators. The book, however, excited great interest among people concerned with the Bacon-Shakespeare controversy, and formed a notable addition to that literature. In 1889 the indefatigable author brought out a novel under the title “CÆsar’s Column,” being a graphic and horrible picture of the fancied results of the sway of an unbridled plutocracy in America. Published at a happy moment, the book was sold by hundreds of thousands of copies, not only in America but in translated versions in Europe. The first edition appeared under the name of Edmund Boisgilbert, and the author had no little difficulty in finding a publisher. In another novel, “Dr. Huguet,” the author appealed for a humaner treatment of people of color, but the public did not respond by buying largely. Later ephemeral volumes and pamphlets added nothing to the repute of a Minnesota author known wherever the English tongue was spoken.
The superintendent of public instruction during the Pillsbury administrations was the Rev. David Burt. Although his education was clerical and his educational experience brief, by a conscientious devotion to the novel duties he carried forward successfully the work of his predecessors. He did much to annul the chronic opposition to the normal schools, and justified the regents of the university in asking more liberal appropriations for buildings and appliances, in spite of the small numbers of its early graduating classes. He persuaded the legislature with no little persistence that the common school fund should be distributed to the districts according to the number of children attending, and not according to the census of those of school age.
The legislature of 1877, acting under an amendment to the constitution adopted two years before, extended to women the right to vote on all measures relating to schools, including the choice of school officers; and “to hold any office pertaining solely to the management of schools.” A later constitutional change extended this privilege to library officers and measures. It has been effectively exercised in but few instances.
In his annual message for 1874 Governor Austin advised the legislature that the text-books used in the common schools were sold to parents at exorbitant prices fixed by a convention of the publishing craft, but made no definite suggestion for relief. Ignatius Donnelly, who was in the state senate continuously from 1874 to 1878, took the lead in an effort to emancipate the people from the tyranny of the school-book ring. His favorite plan was to have the state print books prepared by competent experts and distribute them free to the schools. Two bills for this purpose were passed by the senate and defeated in the house. In 1877 a well-known book dealer of St. Paul came forward with a proposition to furnish text-books as good as those in use for half the prices exacted, provided he could have a fifteen-year contract. To this the legislature agreed, and the contract was made and executed. Mr. Donnelly’s biographer claims that the saving to the state in that term was at least $2,839,765. There is no positive evidence of the allegations that large amounts of money were used to defeat the bill.
In all the territories of the Northwest as they were successively carved out of the old Northwest Territory, provisions were made in their organic acts for universities, to be endowed by grants of land from the general government. That universities could not in fact appear and exist until after the development of fitting schools did not trouble the pioneers, intent chiefly on getting the lands. The reliance of American colleges generally for the preparation of their students had been upon the excellent academies, controlled or countenanced by Christian denominations, which were the ornaments of so many eastern villages. The academy did not multiply nor flourish in the West. Ambitious cities existing on highly colored lithographic maps could tolerate nothing less than a college or university. A score of them were chartered in Minnesota in the fifties. All the western colleges were obliged to open preparatory departments, and it may be said that they have never done more useful service than in thus setting patterns for the secondary education of the future. When the University of Minnesota began college work in 1869 there were practically no efficient preparatory schools in the state. After a study of the situation the president of the university formed the opinion that it was to the budding high schools of the state that the university must look for its supply of students prepared for college work. At the state teachers’ convention of 1872 that body was asked by a committee from the board of regents to join in an endeavor to bring about a vital organic connection between the high schools and the university. It was not proposed that these schools should be made over into mere “fitting schools,” but that, while performing their great function as “people’s colleges,” they should accommodate those worthy, and ambitious youth desirous to carry their school and professional educations still farther. The idea was not unwelcome, but it was not easy to work out a plan of vital, organic connection. Yet one was worked out, embodied in a bill drawn by the head of the university, and laid before the legislature of 1878. The law enacted provided for a money payment out of the state treasury to any high school which, having the proper faculty and equipment, would maintain preparatory courses of study, and admit thereto pupils of both sexes from any part of the state, free of tuition. The schools were obliged to submit to inspection and make reports to the “high school board.” The high schools of cities and villages were thus employed as the state’s agencies for extending free secondary education to all the youth of the state. A beginning was made under the law in the year of its passage, but owing to an omission in an appropriation bill it was not put into full and effective operation till 1881. The results have fully equaled all reasonable expectations. The university, the high schools, and the common schools of Minnesota have been converted from a loose aggregation into a complete, harmonious, organized system. There is open to every child of the state a course of free school education from the kindergarten to the doctorate of philosophy.
On May 2, 1878, soon after seven o’clock in the evening an explosion took place in the Washburn flour mill in Minneapolis. The report was heard at great distances, the windows in neighboring streets were shattered, and not one stone of the great building was left on another above the foundations. Two other mills of less capacity, standing near, blew up within a few seconds, and three others took fire and were completely destroyed. It was the hour for the change of shift of day to night crews, or many more than eighteen men would have lost their lives. The insurance companies, when called upon to pay their losses, demurred, taking the ground that they had insured against fire only, and not against chemical explosion. Mr. Louis Peck, the instructor in physics in the University of Minnesota, attracted by the problem, conducted an exhaustive course of experiments to ascertain the truth of the matter. Some of them were exhibited to the public. His conclusion was that the mills were destroyed by a true fire. He found that any carbonaceous dust, flour, starch, or even sawdust, diffused through the atmosphere, would take fire and burn with an incalculable rapidity from a spark or flame. His testimony compelled the payment of the insurances. The statement of a Minnesota historian that this excellent bit of scientific work was done by a professor in Berlin is erroneous.
Even more disastrous was a fire which on November 15, 1880, destroyed a wing of the hospital for the insane at St. Peter. Twenty-seven patients lost their lives. The state capitol, erected in 1853, took fire in the evening of March 1, 1881, while the senate was in session, and was completely destroyed. Fortunately no lives were lost, but the senators made their escape none too soon. The ceiling fell as the last of them reached the street.
The Fourth of July, 1880, was the two hundredth anniversary of the discovery of the Falls of St. Anthony by Father Louis Hennepin. The event was commemorated by a celebration held on the university campus, under the management of the Minnesota Historical Society, General Sibley presiding. The principal address was delivered by Mr. Cushman K. Davis. Archbishop Ireland charitably defended the Franciscan father from charges of untruthfulness on the ground that unauthorized interpolations were made in his original book. General William T. Sherman was present, and was heard in some happy extemporaneous remarks.
The reader already knows how the people of Minnesota, believing themselves to have been tricked and swindled by a combination of corrupt politicians and greedy railroad operators, forbade in 1860, by a constitutional amendment, their legislature to make any provision for redeeming the special Minnesota state railroad bonds without their affirmative vote. The holders of the bonds refrained from attempts to secure recognition of their claims till after the close of the Civil War. The legislature of 1866 yielded to their urgency so far as to appoint a commission to ascertain who were then holding the bonds and at what prices they had obtained them. The working members of the commission were John Nicols and General Lucius F. Hubbard. It was in this year that the discovery occurred of 500,000 acres of public land coming to the state under the forgotten act of 1841. On Governor Marshall’s recommendation the legislature of 1867, without waiting for the report of the Nicols commission, joyously devoted those acres to the redemption of the bonds. Under the constitutional amendment of 1860 the act had to run the gauntlet of popular vote. The electors turned down the bill by a decisive majority.
The Nicols commission reported to the legislature of 1868 that they had found 1840 of the 2275 bonds in the hands or control of 106 persons. The largest holder was Selah Chamberlain of Ohio, who had held the largest contracts for construction. He averred that his bonds had cost him “more than par” for work done and material furnished; and claimed the whole amount with interest to date as justly due him. Other holders had obtained their bonds by purchase as low as seventeen and one half cents on the dollar. In response to allegations frequently repeated, that the grading done by Mr. Chamberlain for three of the four companies had never cost $9500 a mile, the commission employed an experienced engineer to examine the work and make an estimate of what it should reasonably have cost. His figure was $2843.42 per mile. The report of the Nicols commission did much to confirm the Minnesota people in the conviction that the men who had tricked and cheated them had no standing as honest creditors. Governor Marshall, however, believing that the innocent holders for value at least had just claims, urged the legislature to use the internal improvement lands to satisfy their claims. An absurd bill of 1869 he felt obliged to disapprove. Another of 1870, passed in response to an appeal in his closing message, proposing to turn over the lands at a price which would produce a sum sufficient to pay the bonds, became a law and was ratified by a large majority of the electors voting thereon. The legislature had imposed the condition that the act should not be in effect until at least 2000 bonds had been offered for redemption. But 1032 were turned in, and the act was futile. Governor Austin expressed his regret that the bondholders were unwilling to accept so “fair and equitable a compromise.” The legislature of 1871 entertained a new proposition. The bill introduced provided for a commission whose first duty should be to ascertain and decide whether the bonds were a legal and equitable obligation against the state. If the decision should be affirmative, the commission was to award to each holder the amount due him on the basis of cost, and deliver to him proper amount of new state bonds. The railroad taxes were to be devoted to the redemption of the new bonds. General Sibley had left his retirement and taken a seat in the house of representatives because of his desire to see the old bond matter settled. He had never wavered from his opinion that the state was a debtor to the full amount of the bonds issued. But for his influence the bill could not have passed. He would not believe that Minnesota would not at some time pay what she had promised to pay. Could he so believe, he declared in his speech, he would emigrate to some community in which he would not suffer the “intolerable humiliation” of living in a “repudiating state frowned on by a just and righteous God and abhorred by man.” Governor Austin, although he sympathized with the popular feeling, did not disapprove the bill, but let it go to be mercilessly slaughtered at the polls. The people would not pay mere paper obligations without right or equity behind them. Such they held the bonds to be.
Having failed to obtain satisfaction from the political authorities, the claimants presently resorted to the courts. In 1873 Mr. Chamberlain, their representative, sued the St. Paul and Sioux City Railroad Company to recover from that company as assignee of a portion of the land grant, which he claimed to be still subject to the mortgages authorized by the “five million loan bill.” The decision went against him in the Circuit Court of the United States, and he took an appeal to the Supreme Court, to be there finally defeated. Both of these courts, however, took opportunity to declare that the bonds were legal obligations, and that if the state of Minnesota were suable no court of justice could refuse to adjudge her to pay. “Justice and honor alike” bound her to redeem her bonds. The state of Minnesota was thus branded by the highest judicial tribunals of the land as a defaulting, repudiating state, regardless of the claims of honor and justice. These opinions—they were not decrees—had little effect on the Minnesota people, most of whom never heard of them, but they did affect the minds of many of her public men, who smarted under the reproaches they could not help but hear. Governor Davis in his retiring message urged the establishment of a commission to arbitrate between the bondholders and the state. Governor Pillsbury in his inaugural address urged the payment of the bonds in full, to redeem the reputation of the state. To these appeals the legislators gave no heed. To the legislature of 1877 Mr. Chamberlain for himself and others submitted an offer to cut their claims in two and accept new six per cent. bonds in payment. To this the legislature promptly agreed, but the electors in the following November put their veto on the bill. They did the same thing to an act of 1878 providing for an exchange of internal improvement lands for the bonds, differing in particulars from a previous act of the same general tenor.
In his messages of 1879 and 1881 Governor Pillsbury, under the heading of “Dishonored Bonds,” entreated and implored the legislatures to pay the honest debt of the state and clear her tarnished honor. His earnest and impressive appeals had no effect on the former of the two, but the legislature of 1881 was moved to provide for a special tribunal, to be composed of judges of the supreme and district courts, to consider and decide whether the repudiating amendment of 1860 was binding on the legislature. If the tribunal should hold in the negative, then the old bonds were to be redeemed by new ones at fifty per cent. of the amount nominally due. Not one of the judges of the Supreme Court was willing to serve, and the tribunal was tardily made up of five district judges designated by the governor. The tribunal met and organized, and nothing more. An order from the Supreme Court required it to show cause why a writ of prohibition should not issue, on the ground that the legislature had not the right to establish such a tribunal. The attorney-general at the same time protested against its competency, and had leave to protest further that the act was repugnant to the constitutional amendment of 1860, which forbade payment of the bonds unless after an affirmative vote of the electors. This pleading brought forward as the principal issue the validity of that amendment. The contentions were exhaustively argued in the Supreme Court by able counsel. The decision of the court was that the repudiating amendment of 1860 was obnoxious to that provision of the constitution of the United States forbidding states from passing any law impairing the obligations of contracts. The writ of prohibition issued and the tribunal dissolved. There was no appeal, and the Minnesota legislature was free to dispose of the bond matter without a referendum. Governor Pillsbury called that body to meet on October 11. The bondholders were ready and anxious to accept fifty cents on the dollar. A bill to issue new 10-30 four and one half per cent. “Minnesota state railroad adjustment bonds,” to a sufficient amount, was passed after some contention as to details. A companion bill devoting the proceeds of the 500,000 acres of internal improvement land was passed, and under constitutional requirement submitted to the electors in November, 1884. The vote stood: Yes, 31,011; no, 13,589. The presidential vote of the state in 1880 was 150,484. This vote, therefore, did not indicate so much a change of sentiment among the people as a willingness to have the old bond controversy quieted. The state’s power to borrow at reasonable interest had never been affected. Good judges were of opinion that the bondholders fared very well and could afford the liberal expenditures made to secure the legislation. The amount of new bonds issued was $4,253,000, of which Mr. S. Chamberlain received $1,992,053.70. Governor Pillsbury closed his third term by signing them, a duty he performed with great satisfaction. With this he retired from office, except that he served on the board of regents of the university till his death in 1902, the legislature having by special act created him an additional regent during his good pleasure. He had been on that board since 1863.
