Saturday, October 2, 2010

The Ballad of Honest Dick

It is common knowledge these days- or at least it should be- that anyone in a position of public dependency that handles large amounts of money needs to be placed under some sort of watch. The more money handled, the more stringent the watch should be. Because far too often, people in these positions prove unworthy of trust, and will start to take some of that money for themselves to the maximum extent they are allowed.

Far too often, we forget this fact, and every time we do, we pay dearly for it. Bernie Madoff. Enron. Savings and Loan. James Tate.

Today I tell you about that last one.

James W. Tate was named state treasurer of Kentucky in 1867, after two stints as assistant Secretary of State, and one stint as assistant clerk of the Kentucky House of Representatives. While an elected position, Tate became a fixture in the office, often placing among the biggest winners on the ticket, and putting in two decades of service. Over time, he earned the nickname "Honest Dick" (why a man named James would be called 'Honest Dick' is a question for the ages), with one man, John McAfee, writing in 1886, referring to Tate as a "trusted and honored treasurer" with an "unblemished record for probity and principle."

Famous last words.

Apparently, Tate was regarded as so honest that he had, for 20 years, never been subjected to a serious look at his books. His 1886 opponent, William O. Bradley, found this a little odd, and ran on it in his attempt at unseating Tate. He lost, but he did manage to get the seed planted in Kentucky's collective head. So they asked Tate for a look. Tate replied that he would need some time to get his books in order. Okay, Honest Dick, we can give you a bit of time to do that, but really, we would like to look.

You have surely figured out by now that Tate was not using that extra time to actually get his books in order. During that time, he stopped putting cash into the state's bank account, using checks instead. If he weren't Honest Dick, he'd have been called on this. Or the personal debts he was starting to rack up. On March 14, 1888, one of his clerks DID call him on the fact that he was filling two tobacco sacks with money, about $100,000 worth ($2,357,406 in 2009 money, according to the Consumer Price Index), just like a cartoon bank robber. All that was missing was a dollar sign on the bags. Then Tate hopped a train for Louisville, leaving a note that he would be back in two days.

He never set foot in Kentucky again. From Louisville, he went to Cincinnati, and then vanished, leaving his wife and daughter behind.

By March 20, the state figured something was up, and suspended Tate from his position as state treasurer, the epitome of closing the barn door after the horse has left. They finally, finally, after 22 years, would audit the financial ledger of Kentucky.

Or at least they would have if they could actually make out what in blazes Tate wrote in the darn thing. All they did know was that a whole bunch of money wasn't there anymore. Unpaid loans, advances, personal investments and straight-up theft ultimately relieved the state of Kentucky of $247,128.50. That's 1888 money, remember. According to the Consumer Price Index, in 2009 money, that translates to $5,825,822.76. The treasury vault had personal and state property in it, including beaded bags and purses, one of which was a satchel belonging to a dead child.

The entirety of Kentucky almost had a collective heart attack. Why would Tate steal so much money? He was rich already through land investments! He didn't need the money! (Ah, the naviete of people in 1888.) According to 'Kentucky: Decades of Discord, 1865-1900' by Hambleton Tapp, James C. Klotter and the Kentucky Historical Society, one person wrote "Such a flash of lightning, such a peal of thunder, as was never before seen or heard came out of a clear sky, and rocked the state as nothing had done since the war."

After they got the shock out of their system, the call went up for Tate's head, seeking to try him in absentia. That is exactly what they got; according to 'Political Corruption in America: An Encyclopedia of Scandals, Power and Greed' by Mark Grossman, he was officially brought up on a misappropriation of $197,000 (the official estimate; that's $4,464,090 in 2009 money), along with abandoning his office, doing so without providing for proper administration, and three other charges. He was convicted of four of the charges on March 31, 1888- remember he had fled on the 14th- and the now extremely unfortunately-nicknamed 'Honest Dick' was disqualified from holding state office again. When a new state constitution was written in 1891, three years later, Tate turned out to be singlehandedly responsible for the state banning consecutive terms for state officials, a provision that was only rescinded in 2000, and even then only partially so. A position of overseer was also created.

No recipient of funds, ultimately, was asked to repay, however. Even though just about everyone in Frankfort was under suspicion of having gotten money from Tate at some point, and nobody was trusting anybody by now, it was ultimately determined that Tate acted alone. The governor made a loan of his own to the state until taxes could replenish the coffers.

Not that Tate noticed much of any of this. He had long since gotten away. He had fled to the four corners of the Earth, with varying accounts putting him in places such as Chicago, Arizona Territory, San Francisco, Vancouver, Toronto, Germany, Japan, China and Brazil. It's not really certain what became of him, or even how long he lived after fleeing Kentucky; correspondence to his family ceased in December 1888. There were reports of various Tate sightings in the following years, but in 1897, his daughter had him declared legally dead, and his life insurance was paid off in 1898.

As for William O. Bradley, the guy who first called for a look at Tate's books, he was karmically rewarded by being elected governor of Kentucky in 1895, a term marked by his championing and passage of an anti-lynching law, among other measures protecting the rights of blacks, and elected to one uneventful term in the US Senate from 1909-1914.

He was, in his Senate term, appointed, among other things, chairman of the Senate Committee on Expenditures in the Department of Justice. Just in case.

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