455. Scandals in Political Life.--In 1872 the House of Representatives made a searching inquiry into the charges of bribery in connection with the building of the Pacific railroads. Oakes Ames of Massachusetts was the head of a company called the "Credit Mobilier." This company had been formed to build the Union Pacific Railway. Fearing that Congress would pass laws that might hurt the enterprise, Ames gave stock in the company to members of Congress. But nothing definite could be proved against any members, and the matter dropped. Soon after the beginning of Grant's second term, many evil things came to light. One of these was the Whiskey Ring, which defrauded the government of large sums of money with the aid of the government officials. Grant wished to have a thorough investigation, and said, "Let no guilty man escape." The worst case of all, perhaps, was that of W. W. Belknap, Secretary of War. But he escaped punishment by resigning. [Illustration: A MISSISSIPPI RIVER COTTON STEAMER.] [Sidenote: Failure of reconstruction. _Source-Book_, 349-351.] 456. Anarchy in the South.--Meantime reconstruction was not working well in the South. This was especially true of Louisiana, Arkansas, and South Carolina. In Louisiana, and in Arkansas also, there were two sets of governors and legislatures, and civil war on a small scale was going on. In South Carolina the carpetbaggers and the negroes had gained control. They stole right and left. In other Southern states there were continued outrages on the negroes. President Grant was greatly troubled. "Let us have peace," was his heartfelt wish. But he felt it necessary to keep Federal soldiers in the South, although he knew that public opinion in the North was turning against their employment. It was under these circumstances that the election of 1876 was held. [Sidenote: Election of 1876. _Higginson_, 331-334.] [Sidenote: The electoral commission.] [Sidenote: Hayes inaugurated, 1877.] 457. Election of 1876.--The Republican candidate was Rutherford B. Hayes of Ohio. He was a gallant soldier of the Civil War, and was a man of the highest personal character. His Democratic opponent was Samuel J. Tilden of New York--a shrewd lawyer who had won distinction as governor of the Empire State. When the electoral returns were brought in, there appeared two sets of returns from each of three Southern states, and the vote of Oregon was doubtful. The Senate was Republican, and the House was Democratic. As the two houses could not agree as to how these returns should be counted, they referred the whole matter to an electoral commission. This commission was made up of five Senators, five Representatives, and five justices of the Supreme Court. Eight of them were Republicans and seven were Democrats. They decided by eight seven that Hayes was elected, and he was inaugurated President on March 4, 1877. [Sidenote: Southern politics _Higginson_, 334-335.] [Sidenote: Troops withdrawn.]