The Silver Issue
A remarkable manifesto, dated February 22, 1895, summarized the
grievances of the Populists in these words:
As early as 1865-66 a conspiracy was entered into between the gold
gamblers of Europe and America to accomplish the following purposes: to
fasten upon the people of the United States the burdens of perpetual
debt; to destroy the greenbacks which had safely brought us through the
perils of war; to strike down silver as a money metal; to deny to the
people the use of Federal paper and silver--the two independent sources
of money guaranteed by the Constitution; to fasten upon the country the
single gold standard of Britain, and to delegate to thousands of banking
corporations, organized for private gain, the sovereign control, for all
time, over the issue and volume of all supplemental paper currency.
Declaring that the "international gold ring" was summoning all its
powers to strike at the prosperity of the country, the authors of this
address called upon Populists to take up the gauntlet and meet "the
enemy upon his chosen field of battle," with the "aid and coöperation of
all persons who favor the immediate free coinage of silver at a ratio of
16-1, the issue of all paper money by the Government without the
intervention of banks of issue, and who are opposed to the issue of
interest-bearing government bonds in the time of peace."
There was nothing new in this declaration of hostility to bank issues
and interest-bearing bonds, nor in this demand for government paper
money, for these prejudices and this predilection had given rise to the
"Ohio idea," by force of which George H. Pendleton had hoped to achieve
the presidency in 1868. These same notions had been the essence of the
platforms of the Greenback party in the late seventies; and they had
jostled government ownership of railroads for first place in
pronunciamentos of labor and agricultural organizations and of third
parties all during the eighties. Free silver, on the other hand,
although not ignored in the earlier period, did not attain foremost rank
among the demands of the dissatisfied classes until the last decade of
the century and more particularly after the panic of 1893.
Prior to 1874 or 1875 the "silver question" did not exist. In 1873
Congress, moved by the report of a commission it had authorized, had
demonetized silver; that is, it had provided that the gold dollar should
be the standard of value, and omitted the standard silver dollar from
the list of silver coins. ¹ In this consisted the "Crime of '73." At the
time when this law was enacted it had not for many years been profitable
to coin silver bullion into dollars because silver was undervalued at
the established ratio of sixteen to one. In 1867 the International
Monetary Conference of Paris had pronounced itself in favor of a single
gold standard of currency, and the principal countries of Europe had
preceded the United States in demonetizing silver or in limiting its
coinage. In 1874 as a result of a revision of the statutes of the United
States, the existing silver dollars were reduced to the basis of
subsidiary coins with only limited legal tender value.
¹ The only reference to the dollar was to "the trade dollar" of heavier
weight, for use in the Orient.
The Act of 1873 was before Congress for four sessions; every section,
including that which made gold the sole standard of value, was discussed
even by those who later claimed that the Act had been passed
surreptitiously. Whatever opposition developed at this time was not
directed against the omission of the silver dollar from the list of
coins nor against the establishment of a single standard of value. The
situation was quickly changed, however, by the rapid decline in the
market price of silver. The bimetallists claimed that this decline was a
result of the monetary changes; the advocates of the gold standard
asserted that it was due to the great increase in the production of
silver. Whatever the cause, the result was that, shortly after silver
had been demonetized, its value in proportion to gold fell below that
expressed by the ratio of sixteen to one. Under these circumstances the
producers could have made a profit by taking their bullion to the mint
and having it coined into dollars, if it had not been for the Act of
1873. It is not strange, therefore, that the people of those Western
States whose prosperity depended largely on the silver mining industry
demanded the remonetization of this metal. At the same time the
stringency in the money market and the low prices following the panic of
1873 added weight to the arguments of those who favored an increase in
the quantity of currency in circulation and who saw in the free and
unlimited coinage of silver one means of accomplishing this end. So
powerful was the demand, especially from the West, that in 1878 the
Bland-Allison Act, passed over the veto of President Hayes, provided for
the restoration of the silver dollar to the list of coins, with full
legal tender quality, and required the Treasury to purchase in the open
market from two to four million dollars' worth of bullion each month.
This compromise, however, was unsatisfactory to those who desired the
free coinage of silver, and it failed to please the champions of the
single standard.
For ten years the question of a choice between a single standard or
bimetallism, between free coinage or limited coinage of silver, was one
of the principal economic problems of the world. International
conferences, destined to have no positive results, met in 1878 and again
in 1881; in the United States Congress read reports and debated measures
on coinage in the intervals between tariff debates. Political parties
were split on sectional lines: Western Republicans and Democrats alike
were largely in favor of free silver, but their Eastern associates as
generally took the other side. Party platforms in the different States
diverged widely on this issue; and monetary planks in national
platforms, if included at all, were so framed as to commit the party to
neither side. Both parties, however, could safely pronounce for
bimetallism under international agreement, since there was little real
prospect of procuring such an agreement. The minor parties as a rule
frankly advocated free silver.
In 1890, the subject of silver coinage assumed new importance. The
silverites in Congress were reënforced by representatives from new
States in the far West, the admission of which had not been unconnected
with political exigencies on the part of the Republican party. The
advocates of the change were not strong enough to force through a
free-silver bill, but they were able by skillful logrolling to bring
about the passage of the Silver Purchase Act. This measure, frequently
called the Sherman Law, ¹ directed the Secretary of the Treasury to
purchase, with legal tender Treasury notes issued for the purpose,
4,500,000 ounces of pure silver each month at the market price. As the
metal was worth at that time about a dollar an ounce, this represented
an increase, for the time being, over the maximum allowed under the
Bland-Allison Act and more than double the minimum required by that
measure, which was all the Treasury had ever purchased. But the Silver
Purchase Act failed to check the downward trend in the value of the
metal. The bullion in a silver dollar, which had been worth $1.02 in
1872, had declined to seventy-two cents in 1889. It rose to seventy-six
in 1891 but then declined rapidly to sixty in 1893, and during the next
three years the intrinsic value of a "cartwheel" was just about half its
legal tender value.
¹ John Sherman, then Secretary of Treasury, had a large share in giving
final form to the bill, which he favored only for fear of a still more
objectionable measure. See Sherman's Recollections, pp. 1069, 1188.
Even under the Bland-Allison Act the Treasury Department had experienced
great difficulty in keeping in circulation a reasonable proportion of
the silver dollars and the silver certificates which were issued in lieu
of part of them, and in maintaining a sufficient gold reserve to insure
the stability of the currency. When the Silver Purchase Act went into
operation, therefore, the monetary situation contributed its share to
conditions which produced the panic of 1893. Thereupon the silver issue
became more than ever a matter of nation-wide discussion.
From the Atlantic to the Pacific the country was flooded with
controversial writing, much of it cast in a form to make an appeal to
classes which had neither the leisure nor the training to master this
very intricate economic problem. W. H. Harvey's Coin's Financial School
was the most widely read campaign document, although hundreds of similar
pamphlets and books had an enormous circulation. The pithy and plausible
arguments of "Coin" and his ready answers to questions supposedly put by
prominent editors, bankers, and university professors, as well as by J.
R. Sovereign, master workman of the Knights of Labor, tickled the fancy
of thousands of farmers who saw their own plight depicted in the crude
but telling woodcuts which sprinkled the pages of the book. In his
mythical school "the smooth little financier" converted to silver many
who had been arguing for gold; but--what is more to the point--he also
convinced hundreds of voters that gold was the weapon with which the
bankers of England and America had slain silver in order to maintain
high interest rates while reducing prices, and that it was the tool with
which they were everywhere welding the shackles upon labor. "Coin"
harped upon a string to which, down to the time of the Spanish War, most
Americans were ever responsive--the conflict of interests between
England and the United States. "If it is claimed," he said, "we must
adopt for our money the metal England selects, and can have no
independent choice in the matter, let us make the test and find out if
it is true." He pointed to the nations of the earth where a silver
standard ruled: "The farmer in Mexico sells his bushel of wheat for one
dollar. The farmer in the United States sells his bushel of wheat for
fifty cents. The former is proven by the history of the world to be an
equitable price. The latter is writing its history, in letters of blood,
on the appalling cloud of debt that is sweeping with ruin and desolation
over the farmers of this country."
When many men of sound reputation believed the maintenance of a gold
standard impossible what wonder that millions of farmers shouted with
"Coin": "Give the people back their favored primary money! Give us two
arms with which to transact business! Silver the right arm and gold the
left arm! Silver the money of the people, and gold the money of the
rich. Stop this legalized robbery that is transferring the property of
the debtors to the possession of the creditors.... Drive these
money-changers from our temples. Let them discover your aspect, their
masters--the people."
The relations of the Populist party to silver were at once the result of
conviction and expediency; cheap money had been one, frequently the most
prominent, of the demands of the farming class, not only from the
inception of the Greenback movement, as we have seen, but from the very
beginning of American history. Indeed, the pioneer everywhere has needed
capital and has believed that it could be obtained only through money.
The cheaper the money, the better it served his needs. The Western
farmer preferred, other things being equal, that the supply of currency
should be increased by direct issue of paper by the Government. Things,
however, were not equal. In the Mountain States were many interested in
silver as a commodity whose assistance could be counted on in a campaign
to increase the amount of the metal in circulation. There were,
moreover, many other voters who, while regarding Greenbackism as an
economic heresy, were convinced that bimetallism offered a safe and
sound solution of the currency problem. For the sake of added votes the
inflationists were ready to waive any preference as to the form in which
the cheap money should be issued. Before the actual formation of the
People's Party, the farmers' organizations had set out to capture votes
by advocating free silver. After the election of 1892 free silver
captured the Populist organization.
Heartened by the large vote of 1892 the Populist leaders prepared to
drive the wedge further into the old parties and even hoped to send
their candidates through the breach to Congress and the presidency. A
secret organization, known as the Industrial League of the United
States, in which the leaders were for the most part the prominent
officials of the People's Party, afforded for a time through its lodges
the machinery with which to control and organize the silverites of the
West and the South.
The most notable triumph of 1893 was the selection of Judge William V.
Allen, by the Democrats and Independents of Nebraska, to represent that
State in the United States Senate. Born in Ohio, in a house which had
been a station on the "underground railroad" to assist escaping negroes,
Allen at ten years of age had gone with his family to Iowa. After one
unsuccessful attempt, he enlisted in the Union Army at the age of
fifteen and served from 1862 to the end of the War. When peace came, he
resumed his schooling, attended college, studied law, and in 1869 was
admitted to the bar. In 1884 he went to Madison County, Nebraska, where
seven years later he was elected district judge by the Populists. Reared
in a family which had been Republican, he himself had supported this
party until the campaign of 1890. "I have always," said he, "looked upon
a political party ... simply as a means to an end. I think a party
should be held no more sacred than a man's shoes or garments, and that
whenever it fails to subserve the purposes of good government a man
should abandon it as cheerfully as he dispenses with his wornout
clothes." As Senator, Allen attracted attention not only by his powers
of physical endurance as attested by a fifteen-hour speech in opposition
to the bill for the repeal of the Silver Purchase Act, but also by his
integrity of character. "If Populism can produce men of Senator Allen's
mold," was the comment of one Eastern review, "and then lift them into
positions of the highest responsibility, one might be tempted to suggest
that an epidemic of this Western malady would prove beneficial to some
Eastern communities and have salutary results for the nation at large."
In this same year (1893) Kansas became a storm-center in national
politics once more by reason of a contest between parties for control of
the lower house of the legislature. The returns had given the
Republicans a majority in the assembly, but several Republican seats had
been contested on suspicion of fraud. If the holders of these seats were
debarred from voting, the Populists could outvote the Republicans. The
situation itself was fraught with comedy; and the actions of the
contestants made it nothing less than farce. The assembly convened on
the 10th of January, and both Republican and Populist speakers were
declared duly elected by their respective factions. Loftily ignoring
each other, the two speakers went to the desk and attempted to conduct
the business of the house. Neither party left the assembly chamber that
night; the members slept on the benches; the speakers called a truce at
two in the morning, and lay down, gavels in hand, facing each other
behind the desk, to get what rest they could. For over two weeks the two
houses continued in tumultuous session. Meanwhile men were crowding into
Topeka from all over the State: grim-faced Populist farmers, determined
that Republican chicanery should not wrest from them the fruits of the
election; equally determined Republicans, resolved that the Populists
should not, by charges of election fraud, rob them of their hard-won
majority. Both sides came armed but apparently hoping to avoid
bloodshed.
Finally, on the 15th of February, the Populist house retreated from the
chamber, leaving the Republicans in possession, and proceeded to
transact business of state in the corridor of the Capitol. Populist
sympathizers now besieged the assembly chamber, immuring the luckless
Republicans and incidentally a few women who had come in as members of
the suffrage lobby and were now getting more of political equality than
they had anticipated. Food had to be sent through the Populist lines in
baskets, or drawn up to the windows of the chamber while the Populist
mob sat on the main stairway within. Towards evening, the Populist
janitor turned off the heat; and the Republicans shivered until oil
stoves were fetched by their followers outside and hoisted through the
windows. The Republican sheriff swore in men of his party as special
deputies; the Populist governor called out the militia.
The situation was at once too absurd and too grave to be permitted to
continue. "Sockless" Jerry Simpson now counseled the Populists to let
the decision go to the courts. The judges, to be sure, were Republican;
but Simpson, ever resourceful, argued that if they decided against the
Populists, the house and senate could then impeach them. Mrs. Lease,
however, was sure that the Populists would not have the courage to take
up impeachment proceedings, and the event proved her judgment correct.
When the struggle was finally brought to an end with the assistance of
the judicial machinery, the Republicans were left in control of the
house of representatives, while the Populists retained the senate. In
joint session the Republicans could be outvoted; hence a silver
Democrat, John Martin, was sent to Washington to work with Peffer in the
Senate for the common cause of silver.
The congressional and state elections of 1894 revealed the unstable
equilibrium of parties, and at the same time the total Populist vote of
nearly a million and a half reflected the increasing popular unrest. In
the West, however, the new party was not so successful in winning
elections as it had been in 1892 because the hostile attitude, sometimes
of the Populists and sometimes of the Democrats, made fusion impossible
in most cases. A few victories were won, to be sure: Nebraska elected a
free-silver Democrat-Populist governor, while Nevada was carried by the
silver party; but Colorado, Idaho, Wyoming, Kansas, and North Dakota
returned to the Republican fold. In the South, the fusion between
Populists and Republicans against the dominant Democrats was more
successful. From several States, Congressmen were elected, who, whether
under the name of Populist or Republican, represented the radical
element. In South Carolina the Democratic party adopted the Farmers'
Alliance platform, swept the State in the elections, and sent
"Pitchfork" Tillman to the United States Senate as an
anti-administration Democrat. Tillman admitted that he was not one of
those infatuated persons who believed that "all the financial wisdom in
the country is monopolized by the East," and who said, "'Me, too,' every
time Cleveland grunts." "Send me to Washington," was his advice to
cheering crowds, "and I'll stick my pitchfork into his old ribs!"
Every political move in 1895 was calculated with reference to the
presidential election of 1896. Both old parties were inoculated with the
free-silver virus; silver men could have passed a free coinage bill in
both houses of Congress at any moment but were restrained chiefly by the
knowledge that such a measure would be vetoed by President Cleveland.
The free coinage of silver, which was the chief demand of Populism, was
also the ardent desire of a majority of the people west of the
Alleghanies, irrespective of their political affiliations. Nothing
seemed more logical, then, than the union of all silver men to enforce
the adoption of their program. There was great diversity of opinion,
however, as to the best means of accomplishing this union. General
Weaver started a movement to add the forces of the American Bimetallic
League and the silver Democrats to the ranks of the People's Party. But
the silver Democrats, believing that they comprised a majority of the
party, proceeded to organize themselves for the purpose of controlling
that party at its coming national conventions; and most of the Populist
leaders felt that, should this movement be victorious, the greatest
prospect of success for their program lay in a fusion of the two
parties. Some there were, indeed, who opposed fusion under any
conditions, foreseeing that it would mean the eventual extinction of the
People's Party. Prominent among these were Ignatius Donnelly of
Minnesota, "General" J. S. Coxey of Ohio, and Senator Peffer of Kansas.
In the South the "middle-of-the-road" element, as the opponents of
fusion were called, was especially strong, for there the Populists had
been coöperating with the Republicans since 1892, and not even agreement
on the silver issue could break down the barrier of antagonism between
them and the old-line Democrats.
It remained, then, for the political events of 1896 to decide which way
the current of Populism would flow--whether it would maintain an
independent course, receiving tributaries from every political source,
eventually becoming a mighty river, and, like the Republican party of
1856 and 1860, sweeping away an older party; or whether it would turn
aside and mingle with the stream of Democracy, there to lose its
identity forever.