Silver was king. It was until 1893. The spring of 1893 saw the nation suffer a horrifying economic collapse. Banks closed and millions of ordinary people lost their entire life savings. The economic depression lasted years, but was called the Panic of 1893. The Panic of 1893 was one of the most severe financial crises in the history of the United States.
In response to the panic, Congress repealed the Sherman Silver Purchase Act late in 1893. The repeal of this act caused a steep decline in the value of silver and gold. This led to the closing of silver mines and financial losses.
The nation suffered, but it was worse in Montana. The state of depression brought towns and the state to their knees. The federal government decided to stop minting silver coins in the fall of 1893 (the repeal of Sherman Silver Purchase Act). The government no longer bought millions of ounces of silver every year to mint the silver coins. Montana’s silver mines closed. Silver towns like Wickes and Granite became ghost towns overnight.
The mining community of Granite sprang up in 1875 after silver was discovered and $40 million worth came out of the ground over the next two decades. More than 3,000 people called Granite home. It was complete with its own red-light district, Chinatown, and newspaper. Hundreds of silver-mine workers clogged the streets in Granite in 1890.
When the panic hit, Banks locked their doors. Nearly one-third of Montana workers lost their jobs. Over 20,000 people became jobless and most homeless overnight. It became a ghost town almost overnight. As many as 3,000 people are estimated to have left the mining town in one day.
Helena was another city that suffered. “The city was dependent on banking, most of which originated back East. There were forty-one banks in Montana in 1893 and after the panic there were only nineteen, a failure rate of 53%. All banking activity fell off by a third that year and would drop even further in 1897.”
The panic and absence of help from the government created outrage among the working people. The wealthy were able to protect themselves from the worst of the depression by buying gold. The working class, unable to buy the gold, suffered desperately. Montanans switched to the Populist Party. They elected 16 Populist representatives and senators to the state legislature.
William Hogan, an unemployed worker from Butte, staged a spectacular demonstration of the people’s outrage. Hogan organized The Montana contingent of Coxey’s Army in Butte. His lieutenants, William Cunningham and John Edwards, were unemployed miners. During the winter of 1893-94, nearly 20,000 Montanans were out of work. Butte’s copper meant that the impact in Butte was less than it might have been, but silver mining was devastated.
Hogan heard the Populists across the country were organizing a big march on ‘Washington, DC. Jacob Coxey, Populist leader of Coxey’s Army, demanded unemployment relief from the government. Hogan’s army gathered in Butte in April 1894 and camped at the Northern Pacific railroad yards.
The financial crisis had driven the Northern Pacific to declare bankruptcy, but the railroad was the only way Hogan and his hundreds of followers would be able to get to Washington D.C. The five hundred men encamped in Butte were actively supported by both the local population, who donated food, and the local government, which supported Hogan’s plea for use of a special Northern Pacific train.
The Northern Pacific wasn’t in a position to grant anything, since the bankrupt company was in the hands of a federal receiver. Fearing Hogan’s followers might simply commandeer a train, the Northern Pacific sought and received an injunction to restrain the Coxleyites, even though most rank-and-file Northern Pacific workers supported Hogan.
Hogan’s followers included railroad men who took control of a Northern Pacific engine in Butte on April 24, 1894 and barreled eastward across the state. A car for provisions, and coal cars for men to ride in were attached and the “wild train” – unscheduled, for which all others must clear the track – headed east. At every stop the Hoganites were cheered. People flooded the tracks in support as the train headed through Bozeman, Livingston and Billings.
Ultimately a chase train and delaying tactics by Northern Pacific executives, together with federal troops dispatched west from Fort Keogh at Miles City, and State militia stopped and arrested most of Hogan’s men at Forsyth.
One man was killed by a federal deputy in an altercation at the Billings train station, but otherwise Hogan’s run had been remarkably peaceful. When they were arrested, the band had three guns, two of which were inoperable, and 43 bibles.
Hogan was arrested and served six months in jail. Many Montanans supported Hogan and the group for trying to gain attention for the plight of the unemployed.
“Following a trial for contempt that freed hundreds of the Hoganites (Hogan himself got a 6-month term in the Lewis & Clark County Jail), about 250 men made their way to Ft. Benton in late May and took boats as far as Omaha, where they joined other Coxleyites heading east.” But by then the protest had effectively ended, with no useful result. Coxley himself was arrested for “walking on the grass” at the U.S. Capitol.
Hogan apparently regained his job in Butte by 1895, when he was listed again as a teamster for the Moulton Mining Company. Butte rebounded from the Panic of 1893 and its boom years would be pretty much continuous until the end of World War I.