CHAPTER XXXIV
ANOTHER ERA OF LEGISLATIVE CORRUPTION
1910-1911
It was only a few months after this election that the investigations of William H. Hotchkiss, State Superintendent of Insurance, followed by that of a New York Legislative committee into the matter of legislative graft, revealed the extensive and variegated corruption of both political parties.
An examination by Mr. Hotchkiss, in October, 1909, of the affairs of the Phœnix Insurance Company of Brooklyn had brought to light a mass of correspondence apparently disclosing an intimate connection between the president of that company and legislative measures, introduced from 1900 to 1910, affecting fire insurance companies. The materials thus unearthed caused Superintendent Hotchkiss to order a full examination of the books and records of other fire insurance companies, which examination was begun in January, 1910.
On January 18, 1910, the New York Evening Post published certain facts the purport of which tended to show that State Senator Jotham P. Allds, when Republican leader of the Assembly, in 1901, had been bribed to assist in killing certain legislation to which bridge construction companies objected. The Senate was forced to investigate, and Allds hastily resigned, but the Senate on March 29, 1910, sustained the charge of bribery by a vote of 40 to 9.
It was well understood that this virtuous action was “a sacrifice” and an ostentatious sop to public opinion; many more legislators than he were implicated in charges of corruption. Meanwhile, Mr. Hotchkiss was persisting in his investigation. In the course of Mr. Hotchkiss’ inquiry, on March 22, 1910, testimony developed the fact that for twenty years or more, “firebug” funds had been raised by insurance companies and lavishly distributed among legislators at Albany and that those companies had employed one William H. Buckley to act as “watcher” on “strike bills” introduced in the Legislature at Albany. Buckley admitted that at a time after only three years’ admission to the bar, he had received $27,000 from insurance companies for representing them during the sessions of the Legislature.
One of the bills introduced in the Legislature was a measure fathered by Senator Thomas F. Grady, a noted Tammany leader, celebrated as the chief orator of the Tammany organization. This bill, called a re-insurance act, was introduced and passed under such circumstances that Vice-President Correa of the Home Insurance Company referred to it in a contemporary letter as “bought legislation.” Mr. Correa also stated in that letter, which was in evidence, that only three re-insured fire insurance companies supported the bill, which gave those three companies a distinct advantage over 209 direct insurance companies doing business in New York State. The bill dealt with the carrying of a reserve where part of a fire risk was re-insured. Senator Grady declared, in a public interview, that this bill was introduced to protect policy holders by compelling the re-insurance company, when a part of a policy was farmed out by the company of the first instance, to keep an adequate reserve against the policy thus taken, but all of the insurance officers examined by Mr. Hotchkiss admitted either wholly or in part, that Grady’s interview did not represent a correct conception of what his bill actually provided.[1]
Another conspicuous Tammany leader implicated in the disclosures before Superintendent Hotchkiss was Senator “Big Tim” Sullivan. He had long been one of the really powerful leaders of Tammany Hall, and held direct sovereignty over the teeming East Side below Fourteenth Street.
Beginning life as a bartender, “Big Tim” Sullivan had been given the nickname “Dry Dollar” Sullivan, because of his habit of carefully wiping the bar before placing change on it. His career in the Assembly and Senate was notorious for the number of bad bills promoted or supported by him. His power in manipulating primaries and swaying elections on the East Side south of Fourteenth Street was recognized as that of a master hand; he knew how to make the “gangs” his obedient servants; not a secret of colonizing voters and carrying elections was unknown to him and his clan; at the same time he was called “the friend of the poor” because of his yearly practise of giving the wastrels of the Bowery and vicinity Thanksgiving and Christmas dinners and presents. By his proved and consistent ability to sway politics in the great and thickly-populated East Side, he had to be recognized as an independent Tammany power; no one could become “boss” of Tammany Hall without his support. His power in Tammany was exceeded only by Mr. Murphy’s. In fact, he was one of the actual rulers, not only of Tammany Hall, but of New York City.