President Grover Cleveland’s handling of the depression, accompanied by protest marches and labor strife, only made a bad situation worse. In the spring of 1894, Jacob Coxey, a Populist reformer from Ohio, led a march on Washington, D.C., demanding that Cleveland and Congress initiate a federal public works program to provide jobs for the unemployed. Though highly critical of the favored few who dominated the federal government, Coxey had faith that if “the people . . . come in a body like this, peaceably to discuss their grievances and demanding immediate relief, Congress . . . will heed them and do it quickly.” After traveling for a month from Ohio, Coxey led a parade of some five hundred unemployed people into the nation’s capital. Attracting thousands of spectators, Coxey’s army attempted to mount their protest on the grounds of the Capitol building. In response, police broke up the demonstration and arrested Coxey for trespassing. Cleveland turned a deaf ear to Coxey’s demands for federal relief and also disregarded protesters participating in nearly twenty other marches on Washington.

In the coming months, Cleveland’s political stock plummeted further. He responded to the Pullman strike in the summer of 1894 by obtaining a federal injunction against the strikers and dispatching federal troops to Illinois to enforce it. The president’s action won him high praise from the railroads and conservative business interests, but it showed millions of American workers that the Cleveland administration did not have a solution for ending the suffering caused by the depression. “While the people should patriotically and cheerfully support their Government,” the president declared, “its functions do not include the support of the people.”

Making matters worse, Cleveland convinced Congress to repeal the Sherman Silver Purchase Act. This angered western miners, who relied on strong silver prices, along with farmers in the South and Great Plains who were swamped by mounting debt. At the same time, the removal of silver as a backing for currency caused private investors to withdraw their gold deposits from the U.S. Treasury. To keep the government financially solvent, Cleveland worked out an agreement with a syndicate led by J. P. Morgan to help sell government bonds, a deal that netted the banker a huge profit. In the midst of economic suffering, this deal looked like a corrupt bargain between the government and the rich.

In 1894 Congress also passed the Wilson-Gorman Act, which raised tariffs on imported goods. Intended to protect American businesses by keeping the price of imported goods high, it also deprived foreigners of the necessary income with which to buy American exports. This drop in exports did not help economic recovery. The Wilson-Gorman Act did include a provision that the Populists and other reformers endorsed: a progressive income tax of 2 percent on all annual earnings over $4,000. No federal income tax existed at this time, so even this mild levy elicited cries of “socialism” from conservative critics, who challenged the tax in the courts. In Pollack v. Farmers Loan and Trust (1895), the Supreme Court declared the income tax unconstitutional and denounced it as the opening wedge in “a war of the poor against the rich; a war constantly growing in intensity and bitterness.”

With Cleveland’s legislative program in shambles and his inability to solve the depression abundantly clear, the Democrats suffered a crushing blow at the polls. In the congressional elections of 1894, the party lost an astonishing 120 seats in the House. This defeat offered a preview of the political shakeup that loomed ahead.