The Foreign Service Journal, November 2014

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.