Aside from the nomination of members of the cabinet, the first important executive action that tested the attitude of the Senate toward the President was in relation to the southern problem. By March, 1877, all the former Confederate states except Louisiana and South Carolina had freed themselves from Republican rule by the methods already mentioned, and in these states the Republicans were kept in power only by the presence of troops. In Louisiana, both Packard, a Republican carpet-bagger, and Nicholls, a Louisiana Democrat, claimed to be the rightful governor. In South Carolina, the Republican contestant was Chamberlain, a native of Massachusetts; the Democrat was Wade Hampton, a typical old-time southerner. Hayes could withdraw the troops, in pursuance of his conciliatory policy, but if he did the Republican governments would certainly collapse because they were unsupported by public opinion. Furthermore, the returning board which had declared Hayes the choice of Louisiana in the presidential election had asserted that the Republican Packard was elected. Blaine, in the Senate, championed the doctrine that Hayes could not forsake the southern Republicans without invalidating his own title. Speaking in a confident and aggressive manner, he held that the honor, faith and credit of the party bound it to uphold the Republican claimants. Nevertheless, the President investigated conditions in both states, satisfied himself that public opinion was back of the Democratic governments and then recalled the troops, hardly more than a month after his inauguration. The Republican governments in the two states promptly gave way to the Democrats, and the storm was on in the Senate.[4]

The Republican politicians believed that no good thing could come from the "rebels," that the President was abandoning the negro, and that he was surrendering the principles for which the party had contended. "Stalwarts," was the name applied by Blaine to these uncompromising party men who would not relinquish the grip of the organization on the southern states. Hayes was freely charged with having promised the removal of the military forces in return for the electoral votes of the two states concerned, and some color seemed to be lent to this accusation when he proceeded to reward the Louisiana and Florida returning boards with appointments to office. Even the New York Times, which usually supported Hayes with vigor, characterized the Louisiana settlement as "a surrender." William E. Chandler who had assisted Hayes as counsel in the disputed election attacked him in a pamphlet, "Can such Things be and overcome us like a Summer Cloud without our Special Wonder?" Most of the influential leaders in both houses of Congress scarcely disguised their hostility. Indeed the discontent went back into the states where, as in New Hampshire, a contest over the endorsement of Hayes was so bitter that the newspaper reporters had to be excluded from the state convention to prevent public reports of schism in the party. The Democrats could not come to his support since they were unable to forget the election of 1876 even in their satisfaction over the treatment accorded the South. In six weeks the President was without the backing of most of his party leaders. On the other hand, a few men of the type represented by Hoar and Sherman commended the President's policy. Independent publications such as Harper's Weekly did likewise, and when the Republican convention of 1880 drew up the party platform the leaders made a virtue of necessity and adopted a plank enthusiastically supporting the Hayes administration.

After he had finished with the southern problem, Hayes confided to his diary, "Now for civil service reform!" And for appointments in general he recorded several principles: no sweeping changes; recommendations by congressmen to be investigated—not merely accepted; and no relatives of himself or his wife to be appointed, however good their qualifications might be. In the meanwhile Secretary Schurz set to work to put the Department of the Interior on a merit basis. The principles that Hayes set up for himself and the steps that Schurz took were in conformity with the party platform of 1876 and with the President's inaugural address; nevertheless the party leaders were displeased, if not surprised, for platform promises were lightly regarded and inaugural addresses were sometimes not to be taken very seriously.

The earliest acts of Hayes were not such as to facilitate the further progress of reform. The appointment of the members of the Louisiana Returning Board to federal offices gave color to charges that they were receiving their reward for assisting the President into his position. Furthermore, on June 22, 1877, he issued an executive order forbidding any United States officials to take part in the management of political organizations and declaring that political assessments on federal officers would not be allowed. So drastic an order brought amazement to the party leaders, who had not dreamed of anything so radical. Perhaps the order was too sudden and sweeping, considering the practices of the time. At any rate it was not enforced and the President seemed to have set a standard to which he had not the courage to adhere. Nevertheless, reform principles were successfully tested in the New York Post Office by Thomas L. James, a vigorous exponent of the merit system who had been appointed by President Grant and was now re-appointed and upheld by President Hayes.

But the great battle for the new idea came in connection with the New York Custom House. Through the port of New York came two-thirds to three-fourths of the goods which were imported into this country, and the necessity for a businesslike conduct of the custom house seemed obvious. Yet there had for some time been complaints concerning the service, and Sherman appointed commissions, with the approval of the President, to investigate conditions in New York and elsewhere. The commission which studied the situation in New York reported that one-fifth of the persons employed there were superfluous, that inefficiency and neglect of duty were common, and that the positions at the disposal of the collector had for years been used for the reward of party activity. The commission recommended sweeping changes which Secretary Sherman and President Hayes approved. It then appeared that the New York officials were not favorable to the President's reform plans. Furthermore, Chester A. Arthur, the collector of the port, was a close friend of Roscoe Conkling, the head of the state machine; and A.B. Cornell, the naval officer, was chairman of the state and national Republican committees; It was evident that an attempt to change conditions in New York would precipitate a test of strength between the administration and the New York organization.

As Arthur and Cornell would not further the desired reforms and would not resign, the President removed them. When he nominated their successors, however, the Senate, led by Conkling, refused to add its confirmation and there the matter rested for some months. Eventually the President's nominations were confirmed, an outcome which seems to have been brought about in part at least by letters from. Secretary Sherman to personal friends in the Senate in which he urgently pressed the case of the administration. The President's victory emphasized the disagreement of the powerful state organization with the reform idea, and while the reformers rejoiced that the warfare had been carried into the enemy's country, newspaper opinion varied between the view that the President was playing politics and that he was actuated by the highest motives only. Agitation for reform, meanwhile, continued to increase. The literary men among the reformers, aided by scores of lesser lights, conducted a campaign of education; the New York Civil Service Reform Association, founded in 1877, and the National Civil Service Reform League, in 1881, gave evidence of an effort towards the organization of reform sentiment.

While the attention of the President and the politicians was directed toward the reform of the civil service, there occurred an event for which none of them was prepared. Early in the summer of 1877 train hands on the Baltimore and Ohio Railroad struck because of a reduction in wages, the fourth cut that they had suffered in seven years. The strike spread with the speed of a prairie fire over most of the northern roads between New England and the Mississippi. At the height of the controversy at least 100,000 strikers and six or seven thousand miles of railway were involved, while at several points especially Martinsburg, West Virginia, and Pittsburg, rioting and destruction took place. A considerable number of people were killed or wounded, and the loss of property in Pittsburg alone was estimated at five to ten millions of dollars. Eventually, when the state militia failed to check the disorder, the President was called upon for federal troops and these proved effectual. That even so thoughtful and conscientious a man as Hayes was far from understanding the meaning of the strike was indicated in his message to Congress in which he merely expressed his gratification that the troops had been able to repress the disorder. Repression, that is to say, was the one resource that occurred to the mind of the chief executive and to the majority of the men of his day. That repression alone could not remedy evils permanently, that salutary force ought to be immediately supplemented by a study of the rights and wrongs of the two sides and by a dispassionate correction of abuses,—all this did not even remotely occur to the thoughts of the political leaders of the time.

The breach in the ranks of the Republicans which was made by the events of the early days of the Hayes administration was closed in the face of an attack by the common enemy—the Democrats. The latter, being in control of the House, appointed the "Potter Committee" to investigate the title of Hayes to the Presidency, hoping to discredit him and thereby turn the tables in the election of 1880. The committee examined witnesses and reported, the Democrats asserting that Tilden had been elected and the Republicans that Hayes had been. The Republican Senate, meanwhile, had prepared a counterblast. By legal proceedings a committee had obtained from the Western Union Telegraph Company over thirty thousand of the telegrams sent by both parties during the campaign. The Republicans declared that the "cipher despatches" among these messages showed that the Democrats had offered a substantial bribe for the vote of an Oregon Republican elector. Before the dispatches were returned to the telegraph company, somebody took the precaution to destroy those that concerned Republican campaign methods and to retain those relating to the Democrats. The latter were published by the New York Tribune and revealed attempts to bribe the Florida and South Carolina Returning Boards. Most of them had been sent by Tilden's nephew or received by him, so that the corrupt trail seemed to lead straight to the candidate himself, but the evidence was inconclusive. The Potter Committee then investigated the telegrams, together with a great number of witnesses, and another partisan report resulted. It thus appeared that both pot and kettle were black and there the matter rested. The Democrats had done themselves no good and had done the Republicans no harm.[5]

The Democrats also attacked the election laws, under which federal officials supervised elections, and federal judges and marshals had jurisdiction over cases concerning the suffrage. Under these laws, also, troops could be used to enforce the judgments of the Courts. There is no doubt that intimidation, unfair practices and bribery were all too common in the North as well as in the South. The lack of official ballots and secret voting made abuses inevitable. In New York, Cincinnati and other northern cities, and on a smaller scale in the rural districts, abuses of one sort or another were normal accompaniments of elections. Intimidation in the South was notorious and not denied. The existing election laws gave the dominant party an opportunity to appoint large numbers of deputy-marshals—largely party workers, of course-paying them from the national treasury and so solidifying the party organization. In the election of 1876 about $275,000 had been spent in this way. Some of the federal supervisors had been extremely energetic—so much so that in one case in Louisiana their registration lists showed 8,000 more colored voters in 1876 than were discovered by the census enumerators four years later.

If the Republicans saw involved in the laws both a principle and a party weapon, the Democrats saw both a principle and an opportunity. They attached a "rider" to an army appropriation bill, which made it unlawful to use any part of the army for any other than the purposes expressly authorized by the Constitution or by act of Congress. Since the Constitution allowed the use of troops only to "execute the laws of the Union, to suppress Insurrections and repel Invasions," the new law would prevent the employment of armed forces for civil purposes at the polling places. The President was compelled to yield to save the appropriation bill.