Going for Gold: How the Confederacy Hatched an Audacious Plan to Finance Their War
The California gold rush turned out to be a welcome gift to the Union cause in the 1860s. Gold was discovered at Sutter’s Mill in the foothills of the Sierra Nevadas in 1848 and silver and gold in the Comstock Lode on the other side of the Sierra Nevadas in 1859. And while Abraham Lincoln’s administration had its share of financial problems, precious metals from the West helped keep Northern banks solvent during a protracted, bloody—and expensive—Civil War and reassured an anxious public that the United States would be able to pay its debts. With the Transcontinental Railroad some years in the future, the Union faced the problem of getting the gold and silver to banks in the East. By stagecoach it went as far as San Francisco, where it was loaded onto Pacific steamers bound for Panama, carried by railroad across the isthmus, and loaded onto Atlantic steamers for the final leg of the journey.
The Confederacy—considerably smaller, agrarian, and suffering a Union naval blockade—enjoyed no such windfall. While capable of stunning victories on the battlefield—at least in the early days of the war—the state of its treasury remained, to say the least, abysmal. The government had no choice but to try to shore up Confederate finances by printing money…and attempting to commandeer Union treasure whenever possible.
In February 1862, a Confederate army invaded New Mexico Territory. The advance into New Mexico Territory (today’s New Mexico and Arizona) under Brig. Gen. Henry Sibley had several ambitious goals, among them claiming the New Mexico Territory and California for the Confederacy, annexing parts of Mexico, and establishing a presence on the Pacific coast to mitigate the Union blockade of Southern ports. Of particular importance was access to the gold and silver mines in the Western states, especially those of California, Colorado, and Nevada.
Setting out from Fort Bliss, Texas, and moving up the Rio Grande, Sibley’s badly provisioned forces faced a dry and unforgiving environment and planned to rely on captured Union provisions. They were able to win the field against Union Colonel Edward Canby at the Battle of Valverde on February 20-21, but sustained considerable casualties and were unable to take Fort Craig with its storehouses of supplies. Continuing the advance—with a Union fort at their rear—the Confederates won another tactical victory at the Battle of Glorieta Pass against Union Colonel John Slough on March 26-28, but their supply train was destroyed and, again, casualties were unacceptably high. Having no choice, the now demoralized and starving troops retreated down the Rio Grande to Texas, pursued by the combined forces of Canby and Colonel Gabriel Paul (who had replaced Slough). Of an initial force of about 2,500 troops, only about 1,500 returned.
Despite its tactical successes, the New Mexico Campaign was a dismal failure, effectively thwarting Southern ambitions in the West. With the rich gold and silver mines out of reach, the only course left was to try to confiscate Union treasure in transit.
On December 7, 1862, the Confederate raider Alabama captured the Union steamer Ariel east of Cuba. Captain Raphael Semmes had been cruising the Caribbean, looking for the Champion , a ship bound from Panama to New York—and likely carrying a shipment of gold—but the expected ship had been delayed, so he settled for Ariel , which was sailing in the opposite direction. Ariel ’s passengers included a number of ladies and a company of U.S. Marines bound for San Francisco.
According to Semmes:
But Fortune, after all, had played us a scurvy trick. The Ariel was indeed a California steamer, but instead of being a homeward-bound steamer, with a million of dollars in gold, in her safe, I had captured an outward-bound steamer, with five hundred women and children on board! This was an elephant I had not bargained for, and I was seriously embarrassed to know what to do with it.
The soldiers were disarmed and paroled, and Ariel as released for a promise of $250,000 to be paid to the Confederate government in the form of a ransom- bond signed by Ariel ’s Captain Jones on behalf of the owner, Commodore Cornelius Vanderbilt. Alabama made off with $8,000 in Treasury notes and $1,500 in silver, but the hoped-for millions of dollars in gold remained elusive.
On March 15, 1863, an attempt was made to provision and launch a ship in San Francisco Bay as a Confederate privateer. Asbury Harpending, a young man from Kentucky and an avid Confederate sympathizer, having made his fortune in the gold fields of California and Mexico, turned his efforts to supporting the Confederate cause. In his words:
The idea of interrupting the gold shipments by the Pacific Mail, very essential to the Government at Washington, again took form. This was to be effected by seizure on the high seas. A number of prominent men were interested and I was requested to become one.
Maj. Gen.
Edward R. S. Canby (Library of Congress)
From California, Harpending traveled to Virginia via Mexico. Boarding a blockade runner in Vera Cruz and evading the Union blockade of Charleston, he made his way to Richmond, where he obtained an audience with President Jefferson Davis and Secretary Judah Benjamin. His plan approved, he received letters of marque—and claims to have been commissioned a captain in the Confederate Navy despite his lack of naval experience.
Returning to California in July 1862, Harpending—along with Southern partisans Ridgley Greathouse and Alfred Rubery (the latter a wealthy young Englishman)—secretly purchased the ship J.M. Chapman and outfitted it with cannons and ammunition. They acquired small arms and hired a crew of 15–20 Confederate sympathizers. William Law was signed on as captain and Lorenzo Libby as mate. Harpending had misgivings that Law was hired:
He was the possessor of a sinister, villainous mug, looked capable of any crime, and all in all was the most repulsive reptile in appearance that I ever set eyes on.
Unknown to Harpending, the federal authorities in San Francisco had learned of the plot and Chapman was being watched. On the night of March 14, 1863, with plans to sail the next morning, all but Law boarded the ship. They woke up on the 15th to find themselves in the gunsights of the nearby U.S. man-of-war Cyane with several boats of officers and Marines approaching, along with a tugboat of San Francisco police.
Rubery, Greathouse, and Harpending were arrested and tried in the U.S. Circuit Court and convicted of treason, with Law and Libby turning state’s evidence. Each of the three was sentenced to 10 years imprisonment and a fine of $10,000, although the sentences were never carried out. Rubery, a British citizen with an influential uncle, was pardoned by Abraham Lincoln. Harpending and Greathouse, benefitting from Lincoln’s amnesty of December 8, 1863, each took an oath of allegiance and were released.
And Chapman never sailed for the Confederacy.
With General Robert E. Lee’s defeat at the Battle of Gettysburg and the fall of Vicksburg in July 1863, the tide of war had turned in the Union’s favor. And the Confederacy’s continuing efforts to obtain Union gold were no more effective.
On the night of June 30, 1864, Rufus Henry Ingram led a party of six Confederate guerrillas in a rogue operation to rob two stagecoaches carrying gold and silver from the Comstock Lode. Ingram had fought as a guerrilla under William Quantrill in Missouri and had participated in the infamous attack on Lawrence, Kan., on August 21, 1863, where the men and boys of the Union town were massacred. In California, he organized a group of Confederate sympathizers that came to be known as Captain Ingram’s Partisan Rangers. Included among them was Tom Poole, who had been one of the Confederate crew on Chapman.
The robbery took place on the road from Virginia City, in Nevada Territory, to Placerville, Calif., at a bend in the road 14 miles east of Placerville—a location later dubbed Bullion Bend. The six partisans were masked and heavily armed. Two stagecoaches were stopped—the first driven by Ned Blair, the second by Charley Watson. Each carried 14 passengers and four bags of gold and silver bullion from the Comstock Lode worth about $26,000 and weighing about 250 pounds. The second coach carried an additional $700 in coin. As Blair’s coach was sent on its way, a parting shot from a passenger who turned out to be a Virginia City police officer did little more than scare the horses.
The passengers were treated with the utmost courtesy. Shortly after the first coach had departed, Ingram addressed those on the second coach as follows: “Gentlemen, I will tell you who we are. We are not robbers, but a company of Confederate soldiers. Don’t act foolish. We don’t want anything of the passengers. All we want is Wells, Fargo and Co.’s treasure, to assist us to recruit for the Confederate Army.” Ingram presented the driver with the following receipt:
June 1864
This is to certify that I have received from Wells, Fargo, & Co, the sum of $_ , cash, for the purpose of outfitting recruits enlisted in California for the Confederate States Army.
R. HENRY INGRAM, Capt. Com’g Co., C. S. A.
The blank sum was never filled in. The guerrillas allowed the second coach to proceed and buried the stolen bullion, taking for immediate expenses some gold dust, two silver bars, and the coin.
When the stagecoaches arrived in Placerville with news of the holdup, El Dorado County Sheriff William Rogers organized a posse. Two of their number, Deputy Joseph Staples and Constable George Ranney, encountered the six robbers at the Somerset House, five miles from Pleasant Valley. An ill-advised attempt at arrest led to a shootout in which Staples was killed and Ranney injured. Tom Poole was injured as well. Leaving Poole, the rest of the gang escaped. Subsequently, Rogers arrived with the remainder of the posse and arrested Poole, who confessed and revealed where the bullion was buried.
Ingram did not stop with the Bullion Bend robbery. On July 14, the remaining five guerrillas gathered at Edward Hill’s ranch outside San Jose, planning to ambush another stagecoach on its way to the New Almaden Mines with a sizable payroll. Telling Hill they were waiting for friends, they asked to stay the night. Hill learned of their plans and managed to get word to Captain John H. Adams, sheriff of Santa Clara County. Adams organized a posse and surrounded the house where the guerrillas were staying. In the ensuing shootout, Adams and another posse member were wounded, two of the outlaws were mortally wounded, and one, Alban H. Glasby, surrendered. Ingram and George Baker escaped.
Poole and Glasby were tried in Placerville, along with several associates who had not actually participated in the robberies. Glasby, having turned state’s evidence, was freed. Poole was convicted for his part in the murder of Deputy Joseph Staples and, after an unsuccessful appeal to the California Supreme Court, hanged on September 29.
Ingram and George Baker were never apprehended, but the gold and silver were recovered and never used to benefit the Confederate cause.
On November 10, 1864, a company of Confederate adventurers attempted to seize the steamer Salvador in the Pacific Ocean off Panama.
Stephen Mallory, Confederate Secretary of the Navy, had authorized Acting Master Thomas E. Hogg to lead an expedition to board a Union steamer in Panama as passengers, smuggle arms on board, and commandeer the ship in the name of the Confederate States of America with the intent of fitting it with arms and using it to attack Union shipping in the Pacific. Mallory instructed him:
Having secured the steamer, organized your crew, and hoisted the flag of the Confederate States, you will adopt prompt measures to arm your vessel and proceed to cruise against the enemy of the Pacific.
He went on to make it clear that one of the goals was the acquisition of Union gold:
You will endeavor to strike a blow at the California trade and whalemen in the Pacific, and should you capture bullion, it is suggested that, if no better means for shipping it to Europe offers, you place it in the hands of a British merchant of established character at Valparaiso. A French man-of-war might receive it on board in freight for France.
Hogg’s entire crew numbered 16–20 adventurers. The expedition set out from Wilmington, N.C. Some of the party joined from Havana and some from St. Thomas, intending to rendezvous in Aspinwall, Panama (today’s Colón). There appears to have been a leak in Havana, as the plot became known to Thomas Savage, U.S. Acting Consul-General, who raised the alarm. Union officials allowed the plan to proceed, intending to catch the conspirators in the act. When Hogg and six associates with hidden arms and incriminating documents boarded the steamer Salvador as passengers, they were summarily arrested off Panama by sailors from the nearby U.S. flagship Lancaster. Hogg and his crew were tried by a military commission in San Francisco, found guilty of “violation of the laws and usages of civilized war,” and sentenced to hang. Major General Irvin McDowell reduced the sentences to life imprisonment for Hogg and 10 years each for his six crew members. These sentences were later commuted by President Andrew Johnson and Hogg and his crew were all released.
And, probably for the last time, Confederate efforts to obtain Union treasure were foiled.
In the end, attempts to shore up the shaky finances of the Confederate States by preying on Union treasure were utterly unsuccessful. The New Mexico Campaign was probably the only effort that had had a serious chance of affecting outcome of the Civil War. After its failure, the Confederacy’s only recourse was to try to commandeer the Union gold by what amounted to individual acts of piracy and theft. All failed. Indeed, even had these efforts been successful, they would have been little more than pinpricks to the Union and not likely to make a critical difference to the Confederate Treasury.
After the summer of 1863, Southern fortunes began to crumble, culminating in Lee’s surrender in the spring of 1865. And the sorry state of Confederate finances with the consequent inflation and waning confidence played no small part in its ultimate—some would say inevitable—defeat.
Daniel Seligman is a retired engineer from Massachusetts with a lifelong interest in the American West. He teaches seminars on Western gunslingers and has authored a number of articles on Western history, including Wild West magazine.
This article first appeared in America’s Civil War magazine
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