Bragg Committee

In 1868-69 North Carolina's Reconstruction [3]government extended $27.83 million in the form of bonds and stocks to 18 railroad [4] companies in the state. Although it was mainly zeal for internal improvements [5] that accounted for the state's generosity, some of the more extravagant and ill-advised aid measures resulted from the activities of a railroad "ring" operating primarily through the Republican-controlled General Assembly [6]. The ringleaders were lobbyist Milton S. Littlefield, a suave transplanted northerner, and George W. Swepson, an erstwhile North Carolina banker [7]. Swepson had gained the confidence of Republican governor William W. Holden [8], who foolishly believed that tax revenues would be adequate to meet the interest on the bonds.

By 1870 the bond market had virtually collapsed, leaving North Carolina with a heavy debt and few new railroad miles to show for it. With the state's credit standing deteriorating, both reform Republicans and Conservatives [9] (Democrats) in the General Assembly demanded an investigation of the railroad scandal. The Senate appointed [10]a three-member investigating committee headed by former governor Thomas Bragg [11], a respected Conservative. Influenced by Holden, who believed that the fraud charges were politically motivated, Republicans [12] in the Senate limited the scope of the committee's work and thus prevented a thorough inquiry into the scandal. The Bragg Committee did reveal the need for an extended, unrestricted investigation of the charges. When the Conservatives assumed power later in 1870, they appointed a committee known as the Shipp Commission [13], which subsequently uncovered numerous incidents of fraud and bribery-some involving Conservatives-in the issuance of railroad bonds and stocks. Neither Swepson nor Littlefield, the chief perpetrators of the corruption, were brought to justice.