The first Democrat president after the War, Grover Cleveland went to work immediately on the “Billion Dollar Congress” which notoriously had handed out extravagant war pensions to the Grand Army of the Republic’s (GAR) veterans. In Cleveland’s second term, 1893 to 1897, his Secretary of the Interior, Hoke Smith of Georgia revealed the depth of pension frauds amid the Republican party’s loyal electorate.
Bernhard Thuersam, www.circa1865.org
Hoke Smith and the Grand Army Pensions
“By 1893 there were almost a million pensioners, receiving over $156 billion annually, or almost a third of the entire expense of operating the government. That inveterate reformer Carl Schurz called the pension system “a biting satire on democratic government. Never has there been anything like it in point of extravagance and barefaced dishonesty.”
The pressure exerted by the GAR and the political dynamite in the pension question had continually precipitated more generous pension legislation. Furthermore, the lax administration of the pension laws allowed applicants with the weakest possible claims, as well as some who were guilty of “wholesale and gigantic frauds,” to be admitted to the rolls.
In May 1893, [Hoke] Smith . . . revoked the notorious “Order No. 164″ [of] 1890 . . . an interpretation [by Republican Commissioner of Pensions Raum] which proved highly advantageous to persons with minor disabilities not of service origin. During the second Cleveland administration, the spiraling cost of the Federal pensions was checked . . . [but] it was in Congress that fundamental pension policy was determined and the Congressmen were in a liberal mood as far as the [Civil War] veterans were concerned.”
(Hoke Smith and the Politics of the New South, Dewey Grantham, Jr., LSU Press, 1958)