The Foreign Service Journal - November 2014 - page 67

THE FOREIGN SERVICE JOURNAL
|
NOVEMBER 2014
67
Today, if Robert C. Schenck is remembered at all, it is less
for his part in the Emma Mine scandal than for his role in
popularizing the game of draw poker and compiling the first
definitive set of rules for this game. Yet his tale reminds us that
when non-career ambassadors are bad, they are sometimes
very
bad.
Our Man in Latin America
Schenck’s early life was promising enough. Born in 1809 in
Franklin, Ohio, he graduated from Miami University in 1827
and became a lawyer in 1833, working in Dayton. Active in
Whig politics, he was elected to the Ohio legislature in 1840
and then to the U.S. House of Representatives in 1842, where
he served four terms.
In 1851 President Millard Fillmore’s Secretary of State, Dan-
iel Webster, persuaded Schenck to accept an appointment as
minister to Brazil, with accreditation to Uruguay, the Argentine
Confederation and Paraguay. Over the next two years, he suc-
cessfully concluded trade agreements with all four countries,
by which the United States gained advantages never accorded
to any European. He then returned to Ohio to resume his legal
and political activities.
A few years later, Schenck switched his party affiliation from
Whig to Republican, and was a strong supporter of Abraham
Lincoln’s 1860 presidential campaign. When the Civil War
broke out, he offered his services to the Union, and Lincoln
named him a brigadier general in June 1861.
As Schenck later recounted, “Lincoln sent for me and asked,
‘What can you do to help me?’ I said, ‘Anything you want me
to do. I am anxious to help you.’ He asked, ‘Can you fight?’ I
answered, ‘I would try.’ Lincoln said, ‘Well, I want to make
a general out of you.’ I replied, ‘I don’t know about that, Mr.
President, you could appoint me as general, but I might not
prove to be one.’ Then he did so, and I went to war.”
Schenck proved to be a brave if not particularly talented
military leader. He commanded brigades in the First Battle
of Bull Run in July 1861, the spring 1862 Shenandoah Valley
campaign against “Stonewall” Jackson, and the Second Battle
of Bull Run in August 1862. At the Second Battle of Bull Run he
suffered such severe wounds to his right arm that it became
virtually useless. He was promoted to major general for his
bravery, but was removed from field command.
He returned to the U.S. House of Representatives in March
1863, serving three more terms before losing his 1870 re-elec-
tion bid by just 53 votes. President Ulysses S. Grant, who was
known to have a soft spot for former Civil War officers, espe-
cially wounded ones, appointed Schenck minister to the Court
of St. James’s after his electoral defeat.
Not long after sailing for England in the summer of 1871,
Schenck’s troubles began.
Caveat Emptor
Located near the town of Alta, in the Utah Territory, the
Emma Silver Mine was owned by James E. Lyon. In April 1871,
Trenor W. Park and Henry H. Baxter bought interests in the
mine from Lyon. Park had previously been involved in a min-
ing scandal. One of Lyon’s advisers for the sale was William
M. Stewart, a senator from Nevada and a lawyer with a shady
background.
Based on the purchase agreements, the new owners and
Stewart valued the mine at $1.5 million, but they believed they
could sell it to investors in England for £1 million, or about $5
million. (Currency exchange rates at this time were fixed under
the gold standard; £1 = $4.85.) To advance this scheme, from
May through September 1871 they ran the mine full-out. The
silver was sold on the London market and excited the appetite
of British investors for shares in the mine—but its ore reserves
were being significantly drained.
Soon after Schenck arrived in London, Park and Stewart
traveled there to lay the groundwork for selling the shares.
As they formed a board of directors for the British entity that
would control the mine, Emma Silver Mining Company Ltd.,
they approached Schenck to join. They knew that having the
U.S. minister on the board would demonstrate the “extraordi-
nary character” of the investment.
The two men offered Schenck a directorship with an annual
President Ulysses S. Grant, known to have a soft spot
for former Civil War officers, especially wounded ones,
appointed Schenck minister to the Court of St. James’s.
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