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The Indiana Klan was a branch of the Ku Klux Klan, a secret society in the United States that organized in 1915 to affect public affairs on issues of Prohibition, education, political corruption, and morality. It was most strongly anti-Catholic, but also opposed Jews and blacks. It opposed immigration from southern and eastern Europe, which was sharply reduced by a new law in 1923. In Indiana, the Klan generally did not practice overt violence but used intimidation in certain cases. Nationally it practiced racism and terrorism against minority ethnic and religious groups.
The Indiana Klan rose to prominence beginning in the early 1920s after World War I, when ethnic Protestants felt threatened by social and political issues, including changes caused by decades of heavy immigration from southern and eastern Europe. By 1922 the state had the largest organization nationally, and its membership continued to increase dramatically under the leadership of D.C. Stephenson. It averaged 2,000 new members per week from July 1922 to July 1923, when he was appointed as the Grand Dragon of Indiana. He led the Indiana Klan and other chapters he supervised to break away from the national organization in late 1923.
Indiana's Klan organization reached its peak of power in the following years, when it had 250,000 members, an estimated 30% of native-born white men. By 1925 over half the elected members of the Indiana General Assembly, the Governor of Indiana, and many other high-ranking officials in local and state government were members of the Klan. Politicians had also learned they needed Klan endorsement to win office.
That year Stephenson was charged and convicted for the rape and murder of Madge Oberholtzer, a young schoolteacher. His vile behavior caused a sharp drop in Klan membership, which decreased further with his exposure to the press of secret deals and the Klan's bribery of public officials. Denied pardon, in 1927 Stephenson began to talk to the Indianapolis Times, giving them lists of people who had been paid by the Klan. Their press investigation exposed many Klan members, showed they were not law-abiding, and ended the power of the organization, as members dropped out by the tens of thousands. By the end of the decade, the Klan was down to about 4,000 members and finished in the state. Efforts by some to revive it in the period of the 1960s and 1970s were not successful.
In 1920 Imperial Wizard William J. Simmons of Atlanta, Georgia chose Joe Huffington to start an official Indiana chapter of the Ku Klux Klan. Huffington left for Indiana and set up his first headquarters in Evansville.
Huffington met D.C. Stephenson, a fellow war veteran with a background in Texas and Oklahoma, who quickly became one of the leading members of chapter. Stephenson was active in the local Democratic Party and had run unsuccessfully in the Democratic Congressional primary of 1922 as an anti-prohibition candidate. He was more successful with recruiting and organizing new members. Like other agents, Stephenson got to keep a portion of the entrance fees, and began to amass wealth. Entrance in the Klan cost $10, plus dues, and the recruiter personally kept $4 of each registration. It is estimated that Stephenson made between two and five million dollars from his position in the Klan. Southern Indiana had already had significant vigilante activity among White Cap groups, dating back to the American Civil War.
Stephenson was an active recruiter. He stressed the concept of the Klan as a fraternal society and brotherhood, organized for civic activism, to help the poor and defend morality. He gained the support of many ministers and church congregations for these appeals to populist issues, and the Klan grew rapidly in Indiana.
In November 1922, Hiram Wesley Evans took power as the new Imperial Wizard in Atlanta, with the support of Stephenson. As a reward and in recognition of Stephenson's recruiting success, in July 1923, he appointed the younger man as Grand Dragon of the Indiana Klan, and head of recruiting for seven states north of Mississippi.
By late 1923, Stephenson led the Indiana Klan in breaking away from the national organization and forming a rival group. With its high rate of membership, the Klan became influential in the Indiana politics; an endorsement from the organization could practically guarantee victory at the polls. This led to many politicians at all levels of government to join the Klan in order to gain their support. The Klan became so powerful, and Stephenson so influential, that by 1925 he began to brag, saying "I am the law in Indiana."
The Klan's rhetoric was anti-Catholic in these years, and it alleged that Catholics were behind secret plots to overthrow the government and exterminate Protestants. Immigrants, and especially those from Catholic countries, were included in criticism, as were Jews. A third, and lesser enemy, were blacks. The Indiana Klan stressed more social issues than racism, as it promised to uphold moral standards, help enforce Prohibition, and end political corruption. The Klan also publicly attacked adulterers, gamblers, and undisciplined youths.
The Klan members wanted to end authorization for Catholic parochial schools, and remove all Catholic influence from public schools. The Klan was unable to attain either goal, but attained support for their agenda from key leaders. Samuel Ralston delivered an anti-Catholic speech in 1922 which the Klan reproduced and spread across the state. With their support, he was elected to the United States Senate in 1923.
At the height of its power the Klan had over 250,000 members, which was over 30% of state's white male population. The highest concentration was around the central part of the state. Klan membership was discouraged in some parts of the state; in New Albany, city leaders denounced the Klan and discouraged residents from joining. Other cities, including Indianapolis, were almost completely controlled by the Klan, and election to public office was impossible without their support. Street fights occurred in Indianapolis between the Klan members and minority groups. Statewide, estimates of native white male Indiana Klan membership ranged from 27 to 40%.
The Klan had a large budget, based on a percentage of membership fees and dues. With more than 50,000 dues-paying members in Indianapolis, the Klan had access to tens of millions of dollars. A large part of these funds went to helping the poor, but millions were also poured into bribing public officials, paying off enemies, purchasing weapons, and contributing to political campaigns.
In 1922, Klansmen in the Indiana General Assembly passed a bill that created a Klan Day at the Indiana State Fair, complete with a nighttime cross burning. Governor Warren T. McCray vetoed the bill, beginning his public resistance to the Klan; he was the highest-ranking official to oppose them. The same year Edward L. Jackson, a Klan member who had been elected as the Secretary of State, granted the Klan a state charter. McCray demanded the charter be revoked because the leaders of the Klan did not reveal themselves to sign the document. Jackson refused to revoke the charter. Stephenson ordered Jackson to offer McCray a $10,000 bribe to try to end his anti-Klan stance. McCray was personally wealthy and he refused the bribe.
Unable to bring McCray to their side, the Klan leaders worked to uncover dirt on McCray to force him out office. They uncovered loans solicited by McCray in a questionable way. Because the solicitations were sent by mail, they were subject to federal mail fraud laws. The Klan leaders used their influence to have McCray tried, convicted, and imprisoned for mail fraud, forcing him to resign from office in 1924. Edward Jackson was elected to the governor's office that fall.
In 1925 Stephenson met Madge Oberholtzer, the head of the state's commission to combat illiteracy. The night of the inaugural ball of Republican Governor Edward L. Jackson, she was abducted from her home, taken to the Indianapolis train station, and held in a private car. On the train to Hammond, Stephenson raped her repeatedly and attacked her. In Hammond, she pleaded the need to get to a drug store, where she secretly ate mercury tablets and bi-chloride. Using the illness brought on by the poisons as an excuse, she begged Stephenson to release her. He took her back to Indianapolis and held her at his place. After Oberholzer refused to marry him several days later, he had her returned to her home and secretly placed in bed. When her parents found her, the young woman was nearly dead. Taken to the hospital, Oberholzer died about a month later. She told her story in detail to several witnesses. Stephenson was immediately arrested and charged with second-degree murder. The attending doctor, who testified in the trial, said that Oberholtzer's wounds appeared as if a cannibal had chewed on her. The prosecution held that the wounds and mercury together caused the death of Oberholzer. Stephenson was convicted and the State Supreme Court upheld the decision. He remained in prison until 1956, when he received parole.
Denied a pardon by Governor Jackson, whom he had supported, Stephenson in 1926 began to talk to reporters from the Indianapolis Times and expose many of the high-profile members of the Klan. Stephenson gave the reported names of politicians and officials whom the Klan had bribed, and who had accepted money. The mayor of Indianapolis, John Duvall, was jailed for thirty days and later convicted of bribery. Numerous commissioners and other local leaders across the state were forced to resign on bribery charges, stemming from acceptance of support from the Klan. Governor Jackson was charged with bribery for his role in attempting to influence McCray. The court found the charges against Jackson true, but judged him not guilty, as the statute of limitations had expired on his crimes. He ended his term and did not seek re-election. He was disgraced and never held public office again. Many other leaders of the Klan were arrested and tried on charges of conspiracy to bribe public officials.
The press investigation, which won a Pulitzer Prize, revealed that more than half the members of the Indiana General Assembly were Klan members. The Stephenson case and bribery scandal destroyed the Klan's image as the defenders of women and justice. Members abandoned the organization by the tens of thousands.
The historian James Madison cautions that the Klan
"cannot be dismissed as either an aberration or as simply the insidious appeal of a fanatical few. Nor should the Klan be seen as thoroughly dominating the state and accurately reflecting racist, violent, or provincial beliefs shared for all time by all Hoosiers."
Some people tried to revive the Klan in the 1960s and 1970s, when changing social values, the Vietnam War, urban riots and industrial restructuring caused widespread disruption. The organization never regained the members or power it held during the 1920s.