The Reformer as Political Lightning Rod: Gov. Carl Edward Bailey

Old State House Museum - Wednesday, July 15, 2020

Carl Bailey will never be known as a politician who stuck his finger in the air and judged the political winds before moving on a particular issue - instead, he was known for his stalwartness in the face of opposition. By doing so, he pursued his political career and governed as the consummate outsider, in spite of the fact that he had few, if any, philosophical differences with many of the rivals whom he constantly warred with throughout his time as a prosecutor, attorney general and governor. While fearless in his reform efforts, his success was limited by his antagonism toward others who ran efforts at the federal level designed to promote the programs of the New Deal, which he enthusiastically supported. A career that began with great promise was ultimately cut short by debilitating factionalism.

A product of Bernie, Missouri, and the son of a logger and hardware salesman, Bailey grew up for a time in Paragould, Arkansas, and Paducah, Kentucky, before his family moved to Campbell, Missouri, where he graduated from high school. After graduation, he supported himself in a series of jobs and read law. When he was unable to finish business college, he worked as a deputy tax assessor. He married Margaret Bristol of Paragould in 1915, and they had six children. He passed the Arkansas Bar Exam in 1922 and moved to Little Rock, eventually going into private practice in 1924.

As his law practice increasingly allowed him to do so, Bailey became politically active. After a tenure as deputy prosecutor, he was elected prosecuting attorney in 1930. His tenure was dominated by high profile criminal cases, some of which earned him the enmity of Arkansas’s political establishment.

The most prominent case involved A.B. Banks, the head of a banking empire headed by the American Exchange Trust Co. of Little Rock, which collapsed in 1930. This set off a wave of bank failures that brought down 66 other banks around the state. Bailey prosecuted Banks for fraud because his company had continued to accept deposits even when Banks knew it was insolvent. Although Banks was pardoned, Sen.Joe T. Robinson was Banks’s defense counsel and close friend, and the senator never forgave Bailey for prosecuting Banks.

After supporting Brooks Hays’s unsuccessful bid for a congressional seat in a 1933 special election, Bailey further antagonized the establishment, which now was controlled by a powerful coalition of federal and state figures that included Robinson, Gov. J. Marion Futrell and Internal Revenue Commissioner Homer Adkins. This rivalry dominated Arkansas politics until 1940. In 1934, in what was considered a spectacular upset, Bailey unseated Attorney General Hal Norwood, an entrenched establishment-backed incumbent, further alienating the Robinson faction.

Bailey’s single term as the state’s chief legal officer was marked by more conflict with the establishment. Arkansas had never dealt with a social welfare system, but the onset of the Great Depression and the New Deal made it necessary. When the U.S. Congress created the Social Security system in 1935 to assist the nation’s “unemployables,” and in order to qualify for federal matching funds in Arkansas’s case, a 1 cent sales tax was passed, and the Department of Public Welfare was created. Bailey actively lobbied for the measure in the legislature, while Futrell was a reluctant convert.

Another source of friction with Futrell was the case of New York mobster Charles “Lucky” Luciano, who had fled to Hot Springs to avoid a New York warrant. After Futrell ordered the gangster’s arrest, a Garland County judge allied with establishment ally Mayor Leo McLaughlin released him on token bail, and Futrell took no action to secure Luciano. New York prosecutor Thomas E. Dewey appealed to Bailey to arrest Luciano and transfer him to Little Rock, removing him from Garland County’s jurisdiction. After refusing a $50,000 bribe from friends of Luciano, Bailey revealed the attempted bribe publicly. In an abrupt about face, Futrell signed the extradition, and Luciano was returned to New York. Bailey’s public image was enhanced, and the Robinson-led establishment could barely contain its fury.

Carl Bailey used this Corona portable typewriter while on the gubernatorial campaign trail. When Futrell prepared to step down from office in 1936, Bailey entered a crowded Democratic primary and narrowly defeated the establishment’s preferred candidate, Secretary of State Ed McDonald. As governor, Bailey held those he referred to as the “puppets of privilege” in public contempt and declared that government must take a role in helping the people gain “a decent, civilized existence.”

In a contentious 1937 legislative session, he gained passage of much of his program: establishing the state’s first merit based civil service system, restructuring the Department of Public Welfare by consolidating all welfare activities under its umbrella and passing a refinancing plan for the state’s highway bonds. His record of success in his maiden legislature proved to be quite good in spite of establishment hostility.

This triumph did not last. After barely six months in office, Robinson died in July 1937, and the battle lines were drawn again. Bailey wanted the seat, and because he controlled the Democratic Party machinery, he could decide if there was to be a primary or if the nominee was to be nominated by convention. At Bailey’s urging, the party decided to go with a convention and nominated Bailey. Establishment backers were furious and accused Bailey of hypocrisy because he had attacked Futrell for desiring to do the same with the vacant Fifth District congressional seat in 1933. The breach between the “state faction” (Bailey) and the “federal faction” (now led by Adkins) was complete.

The federal faction prevailed upon Second District Rep.John Miller to run as an independent candidate in the general election. In a bitter campaign, Miller extinguished Bailey’s dreams of a Senate seat with more than 61 percent of the vote. He gained some modest success in a 1938 special session to deal with highway matters, particularly a measure to ban tolls from the state’s bridges to gain additional federal funds. Bailey still feared for his 1938 reelection bid, but Adkins and the federal faction put all their energy and effort into defending the seat of Sen. Hattie Caraway from the challenge of Sixth District Rep. John McClellan. Bailey prevailed over Pulaski County Judge R.A. Cook by a comfortable margin.

While Bailey disclaimed any interest in “experimental” legislation from the 1939 General Assembly, the session contained more turmoil than in 1937. Bailey’s attempt to decentralize the state welfare department was stopped by a federal threat to cut off funds, and Bailey even backtracked on his support for civil service by cutting the number of covered positions. In defiance of the governor, lawmakers abolished the whole system.

Animosity arose anew when Bailey fired the unemployment compensation director, who was backed by his rivals, and feuded with state Works Progress Administration (WPA) Chief Floyd Sharp. Bailey claimed that WPA workers had become just an extension of a machine headed by Sharp and Homer Adkins. In the 1939 General Assembly, Bailey pushed lawmakers to investigate Dyess Agricultural Colony in Mississippi County, which was headed by Sharp and Futrell, but that effort also failed. Bailey made a final attempt to refinance the highway debt, but Adkins and his allies tied it up in court.

In early 1940, Adkins announced his candidacy for governor. While Bailey was loath to run again, Adkins was totally unacceptable to him, so he sought an ill-advised third term. The federal appointees and disaffected factions united against him, so Bailey had little chance. He lost with only 43 percent of the vote.

Scabbard for Governor Carl E. Bailey's Masonic Sword.

Renewing his interests in labor law, education and business, he served as a lobbyist for the Brotherhood of Railway Trainmen, taught legal medicine at the University of Arkansas Medical School. Bailey also founded the Carl Bailey Company, an International Harvester franchise in North Little Rock. He died suddenly in 1948 at the age of 54.

Bailey governed during a period of great economic and social change. He often provoked controversy. His career’s chief irony was that, as an ardent proponent of the New Deal, it was also used to bring about his defeat. But he was the first Arkansas governor to act on the premise that government had an active role to play in enhancing the quality of life for its people.