President Hayes was inaugurated on the 5th day of March (1877)--the
4th falling on a Sunday. As matter of precaution the oath of office
was administered to him by Chief Justice Waite on Sunday--Mr. Hayes
deeming it wise and prudent that he should be ready as President of
the United States to do his official duty if any Executive act should
that day be required for the public safety. Although his title had
been in doubt until within forty-eight hours of his accession, he had
carefully prepared his Inaugural address. It was made evident by his
words that he would adopt a new policy on the Southern question and
upon the question of Civil Service Reform. It was plainly his
determination to withdraw from the South all National protection to
the colored people, and to put the white population of the
reconstructed States upon their good faith and their honor, as to
their course touching the political rights of all citizens.
The Inaugural address did not give satisfaction to the radical
Republicans, but was received with every mark of approbation by the
more conservative elements of the party. Many Democrats would have
supported Mr. Hayes cordially but for the mode of his election. It
was impossible for them to recover from the chagrin and disappointment
of Mr. Tilden's defeat. The new President, therefore, began his
administration with a bitter personal opposition from the Democracy,
and with a distrust of his own policy on the part of a large number of
those who had signally aided in his election.
The one special source of dissatisfaction was the intention of the
President to disregard the State elections in the three States upon
whose votes his own title depended. The concentration of interest was
upon the State of Louisiana, where Governor Packard was officially
declared to have received a larger popular majority than President
Hayes. By negotiation of certain Commissioners who went to Louisiana
under appointment of the President, the Democratic candidate for
Governor, Francis T. Nicholls, was installed in office and Governor
Packard was left helpless.(1) No act of President Hayes did so much to
create discontent within the ranks of the Republican party. No act of
his did so much to give color to the thousand rumors that filled the
political atmosphere, touching a bargain between the President's
friends and some Southern leaders, pending the decision of the
Electoral Commission. The election of the President and the election
of Mr. Packard rested substantially upon the same foundation, and many
Republicans felt that the President's refusal to recognize Mr. Packard
as Governor of Louisiana furnished ground to his enemies for disputing
his own election. Having been placed in the Presidency by a title as
strong as could be confirmed under the Constitution and the laws of the
country, it was, in the judgment of the majority of the Republican
party, an unwise and unwarranted act on the part of the President to
purchase peace in the South by surrendering Louisiana to the Democratic
party.
The Cabinet selected by President Hayes was regarded as one of great
ability. Mr. Evarts, Secretary of State, Mr. Sherman, Secretary of
the Treasury, Mr. Schurz, Secretary of the Interior, were well known.
--The Secretary of War, George W. McCrary of Iowa, had steadily grown
in public esteem by his service in the House of Representatives, and
possessed every quality desirable for the administration of a great
public trust.
--Mr. Richard W. Thompson of Indiana, appointed Secretary of the Navy,
was in his sixty-eighth year, and had been a representative in Congress
thirty-five years before. He was known throughout the West as an
ardent Whig and an equally ardent Republican.
--Charles Devens of Massachusetts was appointed Attorney-General. His
standing as a lawyer can be inferred from the fact that he had left
the Supreme Bench of his State to accept the position. To eminence in
his profession he added an honorable record as a soldier, having
served with distinction in the civil war and attained the rank of
Brigadier-General. As a private gentleman he was justly and widely
esteemed.
--For Postmaster-General the President selected David M. Key of
Tennessee, who during the previous session had served in the Senate,
by appointment of the Governor of his State, to fill the vacancy caused
by the death of Ex-President Johnson. The selection of Mr. Key was
made to emphasize the change of Southern policy which President Hayes
had foreshadowed in his Inaugural address. Mr. Key was a Democrat,
and personally popular. A Southern Democrat in a Republican Cabinet
presented a novel political combination, and it is evidence of the tact
and good sense of Mr. Key that he administered his Department in such
manner as to secure, not merely the respect of the Republican party,
but the sincere friendship of many of its leading members. He was wise
enough and fortunate enough to induce Hon. James N. Tyner, whom he
succeeded as Postmaster-General, to remain in the Department as First
Assistant, in order that Republican senators and representatives might
freely communicate upon party questions, which Mr. Key delicately
refrained from even hearing. The suggestion was made, however, by men
of sound judgment, that in projecting a new policy towards the South,
which was intended to be characterized by greater leniency in certain
directions, it would have been wiser in a party point of view, and more
enduring in its intrinsic effect, to make the overture through a
Republican statesman of rank and ability.
Among the new senators of the Forty-fifth Congress were some who were
transferred from the House and were already well known to the country.
James B. Beck of Kentucky, George F. Hoar of Massachusetts, Benjamin
H. Hill of Georgia, had each made a brilliant record by his service in
the House. Mr. Blaine of Maine now entered for a full term, but had
come to the Senate several months before as the successor of Honorable
Lot M. Morrill, when that gentleman was called by President Grant to
administer the Treasury Department.--Among those who had not served in
Congress were several distinguished men. David Davis of Illinois, who
had been fifteen years on the Bench of the Supreme Court of the United
States, now entered the Senate as the successor of General Logan. With
the exception of John Rutledge, who served in the House of
Representatives after he had been on the Supreme Bench, Judge Davis is
the only man who entered Congress after service on the Bench. John
Jay was Minister to Great Britain and Governor of New York after he
resigned the Chief-Justiceship; and Oliver Ellsworth was Minister to
France after his retirement from the Bench. A large proportion of
the justices had been in Congress before they entered upon their
judicial service; but the transfer of Judge Davis to the Senate was
a reversal of the natural order.
Samuel J. Kirkwood, already well known by his service in the Senate,
now returned from Iowa.--Preston B. Plumb of Kansas, who had
been printer, editor, soldier in the civil war with the rank of
Lieutenant-Colonel, member of the Bar, reporter of the Supreme Court of
his State, Speaker of the House of Representatives of Kansas, now
succeeded James M. Harvey. Mr. Plumb was actively and largely engaged
in business affairs, and had perhaps as accurate knowledge of the
resources of the West as any man in the country.--A. H. Garland entered
from Arkansas, being promoted from the Governorship of his State. He
was popular among his own people, and had been a member of the
Secession Convention and of both branches of the Confederate Congress.
His reputation as a lawyer had preceded his entrance into the Senate,
where he was at once accorded high rank among his political
friends.--John R. McPherson, a business man of good repute in New Jersey,
succeeded Mr. Frelinghuysen.--Edward R. Rollins of New Hampshire,
who had creditably served six years in the House, now came to the
Senate as the successor of Aaron H. Cragin.--Alvin Sanders, who was
appointed Governor of the Territory of Nebraska by Mr. Lincoln in
1861, and held the position until the State was admitted to the Union
in 1867, now came as one of her senators.--Richard Coke who had been
Governor of Texas, and Lafayette Grover who had been Governor of
Oregon, now entered the Senate.--Isham G. Harris, who had been in
Congress twenty-five years before and had played a somewhat conspicuous
part in the rebellion as Governor of Tennessee, now succeeded Henry
Cooper as senator from that State.
--William Pinkney Whyte, who entered the Senate the previous Congress
for a full term, had already served in that body for a brief period in
1868-69, succeeding Reverdy Johnson when he resigned to accept the
mission to England. In the interval between the close of his first
service and his second election he had served as Governor of Maryland.
He is a grandson of the eminent William Pinkney, who was a member of
the Senate at the time of his death, and who as an orator was
considered by Mr. Benton, Mr. Clay, and the younger men of that period,
as the most eloquent in the country. Mr. Pinkney Whyte held a
distinguished position at the bar of Maryland, was recognized as a
senator of great ability, and as a private gentleman was highly
esteemed without reference to party lines.
--Stanley Matthews took the seat made vacant by the transfer of Mr.
Sherman to the Treasury Department. His reputation as a lawyer was
well established. He had ben United-States District Attorney for three
years preceding the war. He commanded an Ohio regiment for two years
in the field and resigned to accept a position on the bench of the
Supreme Court. His legislative experience had been limited to a single
term in the Ohio Senate, and as the Democrats had carried Ohio in the
autumn of 1877 before he could take his seat, he saw before him a short
service in Congress. Within the limit of two years, however, he made
a profound impression upon his associates in the Senate. He proved
to be an admirable debater, and seemed intuitively to catch the style
of Parliamentary discussion as distinguished from an argument in court.
He left the Senate with an enlarged reputation, and with a valuable
addition to his list of personal friends.
--Simon Cameron from Pennsylvania resigned his seat in the spring of
1877. He had been four times elected to the body, and had twice
resigned, leaving his total service some eighteen years. He was in his
seventy-ninth year when he retired, but in exceptional vigor of body
and mind. He had the graces of age without its infirmities, and shared
the good will of his fellow senators on both sides of the chamber in
an exceptional degree. He was succeeded by his son, James Donald
Cameron, who up to that period had never been a member of any
legislative body and who was in this forty-fourth year when he took
his seat in the Senate. He was educated at Princeton and had indeed
devoted his life to business. During the last year of President
Grant's Administration he was a member of the Cabinet as Secretary of
War, in which position he showed the same executive power that had
characterized the prompt and orderly dispatch of his private business.
--A fortnight after the meeting of Congress the Senate sustained a deep
loss in the death of Oliver P. Morton. He died at his home in Indiana
on the 1st day of November (1877). He had for several years been in
ill health, but struggled with great nerve against the advances of
disease. Few men could have resisted so long and so bravely. An
iron will sustained him and enabled him through years of suffering to
assume a leading part in the legislation of the country and in
directing the policy of the Republican party.
Governor Morton was succeeded by Daniel W. Voorhees, already widely
known by his service of ten years in the House. Mr. Voorhees was a
Democrat of the most pronounced partisan type, but always secured the
personal good will of his political opponents in Congress.
--M. C. Butler of South Carolina entered the Senate on the 2d of
December, 1877. He had been engaged in all the partisan contests by
which the Republican party was overthrown in South Carolina, and
encountered much prejudice when he first took his seat; but his
bearing in the Senate rapidly disarmed personal hostility, and even
gave to him a certain degree of popularity upon the Republican side
of the chamber.
The House was organized at an extra session called by the President
on the 15th of October, 1877. The failure of the Army Appropriation
Bill at the preceding session rendered this early meeting of Congress
necessary. Samuel J. Randall was re-elected Speaker, receiving 149
votes; his Republican competitor, James A. Garfield, receiving 132.
Among the new members of the House were some men who were afterwards
advanced to great prominence.--Thomas B. Reed of Maine came from the
Portland district. He had been a member of the Bar some twelve years,
had rapidly risen in rank, had served in the State Legislature two
terms, and had been Attorney-General of his State for three years. He
was a strong man in his profession, and had an admirable talent for
parliamentary service. His promotion was not more rapid than his
ability justified and his friends expected.--The Massachusetts
delegation received a strong reinforcement in several new members.
George D. Robinson was a conspicuous figure. He developed great
readiness as a debater, and his career in the House plainly indicated
the eminence he has since attained.--George B. Loring came from the
Salem district. He had served several terms in both branches of the
Massachusetts Legislature and had been President of the Senate. He had
for many years taken part in National contests, and of the _personnel_
and principles of the political parties he possessed a knowledge
equaled by few men in the United States.--William W. Rice of the
Worcester district had devoted himself assiduously to his profession of
the law and had generously shared in its rewards and its honors. From
the midst of his full practice he was chosen to Congress.--William
Claflin, well known as a merchant, had taken active part in the
politics of Massachusetts, had been in both branches of the
Legislature, and served as Lieutenant-Governor, and Governor of the
State.
Horace Davis (a son of the eminent Senator John Davis of
Massachusetts), long resident in California, came as the representative
of the San Francisco district. He had been successful as a business
man on the Pacific Coast, and brought to the service of the House
large experience, strong sense, and high character.--The Indiana
delegation was especially strong, with Thomas M. Browne, John H.
Baker, and William H. Calkins, among its members. Mr. Browne and Mr.
Calkins united a talent for parliamentary discussion with exceptional
power as platform speakers. Mr. Baker was one of the most thorough
men in the House on all questions of finance and taxation.--Hiram
Price, who had already served six years, returned from Iowa.--William
A. Phelps, Dudley C. Haskell and Thomas H. Ryan made a strong
delegation from Kansas.--James F. Briggs, a lawyer of good standing,
entered from the Manchester district of New Hampshire.--John T. Wait,
a highly intelligent representative from Connecticut, had served a
part of the Forty-fourth Congress, and was now returned for a full
term.--Edwin Willets who proved to be a wise legislator came from
Michigan.--Anson G. McCook, of the well-known Ohio family that
furnished so large a number of good soldiers, came from New-York City,
with the personal distinction of having carried a Democratic district.
--Frank Hiscock came from the Syracuse district. He had been a member
of the Convention of 1867 and stood high as a lawyer. He rose rapidly
in the House, soon acquiring a position of the first rank.--John H.
Starin and George A. Bagley were among the conspicuous members of the
New-York delegation.--Judge A. B. James, of long service on the Supreme
Bench of his State, came from the Ogdensburg district, and George W.
Patterson, in his seventy-ninth year, from the Chautauqua district.
Mr. Patterson was Lieutenant-Governor of the State when Hamilton Fish
was governor.
Among the prominent Ohio representatives were Jacob D. Cox, from the
Toledo district; Joseph W. Keifer, from the Madison district,
afterwards promoted to the Speakership of the House; Amos Townsend,
from the Cleveland district, a successful merchant and a man of strong
sense.--General Thomas Ewing came from the Fairfield district. He
was one of the private secretaries of President Taylor before he had
attained his majority, was Chief Justice of the Supreme Court of
Kansas at thirty-one years of age and a member of the Ohio
Constitutional Convention in 1873-74. He was an able lawyer and
strong debater.--William McKinley, jun., entered from the Canton
district. He enlisted in an Ohio regiment when but seventeen years
of age, and won the rank of Major by meritorious service. The interest
of his constituency and his own bent of mind led him to the study of
industrial questions, and he was soon recognized in the House as one
of the most thorough statisticians and one of the ablest defenders of
the doctrine of Protection. He was more widely known afterwards as
a platform speaker, always welcomed by large audiences.
Russell Errett and Thomas M. Bayne entered from the Pittsburg
districts, Pennsylvania. Mr. Errett was a veteran editor in the
anti-slavery cause, and Mr. Bayne was recognized as a young man of
superior ability, ready in debate and with special adaptation to
parliamentary service.--John I. Mitchell, afterwards chosen senator,
entered from the Lycoming district, and Edward Overton from the
Bradford district.--General Harry White entered from the Armstrong
district. He had been confined in Libby Prison for sixteen months
during the war and being a member of the Pennsylvania Senate his
absence made a tie vote. He was not allowed to send his resignation
and thus permit a Republican successor to be chosen, because the
Confederates were not engaged at that time in promoting Republican
success. His resignation was finally sent through the lines, concealed
in a Testament carried by an exchanged surgeon.
The distinctive measure of the Forty-fifth Congress was the passage
of the Act for the coinage of silver dollars. The subject had been
discussed in the Senate and House and before the people, with increased
zeal, ever since the movement for resumption of specie payment took
decided form. For those who had not given special attention to the
question, arguments were at hand from an official source. It would be
more difficult to find a more exhaustive examination into the silver
question than is embodied in the report of the Monetary Commission
(organized under the joint resolution of August 15, 1875), presented
to Congress on the 2d of March, 1877. It has permanent value for the
compact and lucid form in which the history of the precious metals is
presented, and for the clear statement of conflicting theories in
regard to monetary systems.
--Three members of the Commission, John P. Jones and Louis V. Bogy of
the Senate, and George Willard, a representative from Michigan,
believed that the United States should remonetize silver without
regard to the future policy of Europe, and that a law should be passed
fixing 15½ to 1 as the standard of relative value between silver and
gold in this country.
--Mr. William S. Groesbeck favored the remonetization of silver at the
old relation in the United States of 16 to 1, and was joined in this
suggestion by Mr. Richard P. Bland of Missouri.
--Senator George S. Boutwell expressed the opinion that it was not
expedient to coin silver dollars to be a legal-tender, and that the
introduction of silver as currency should be postponed until the effort
to secure the co-operation of other nations had been faithfully made.
--Professor Francis Bowen and Representative Randall L. Gibson thought
that a double standard was an illusion and an impossibility, and
declared the proper place for silver in the monetary system to be that
of subsidiary or token currency, considerably overvalued by law and a
legal-tender only within certain minor limits. They advocated the
coinage of silver dollars of 345-6/10 grains, to be legal-tender for
sums not over twenty dollars, and to take the place of all paper
currency of less denomination than five dollars.
President Hayes presented the subject in his message, December 3, 1877.
He did not believe that "the interests of the Government or the people
would be promoted by disparaging silver," but held that it should be
used only at its commercial value. "If," said he, "the United States
had the undoubted right to pay its bonds in silver coin, the little
benefit from that process would be greatly over-balanced by the
injurious effect of such payments if made or proposed against the
honest convictions of the public creditors."
Secretary Sherman, in his annual report at the same time, said that in
the work of refunding he had informed his associates in an official
letter that "as the Government exacts in payment for bonds their full
face value in coin, it is not anticipated that any future legislation
of Congress or any action of any Department of the Government will
sanction or tolerate the redemption of the principal of these bonds,
or the payments of the interest thereon, in coin of less value than
the coin authorized by law at the time of their issue,--being gold
coin." He earnestly urged Congress to give its sanction to this
assurance.
These official utterances were put forward in the heat of the general
discussion, and fell upon the ears of persons already engaged on one
side of the other of the earnest controversy in regard to the coinage
of silver. Congress was at once called upon from an unexpected
source to make a declaration hostile in its aim and purpose to the
policy advocated both by the Head of the Nation and its chief
financial officer. In direct hostility to the recommendations of an
Ohio President and an Ohio Secretary of the Treasury, an Ohio senator,
Mr. Stanley Matthews, moved a concurrent resolution in the Senate,
declaring that "all bonds of the United States are payable in silver
dollars of 412½ grains, and that to restore such dollars as a full
legal-tender for that purpose, is not in violation of public faith or
the rights of the creditor." A motion to refer the resolution to the
Committee on the Judiciary was defeated--_ayes_ 19, _noes_ 31. It was
kept before the Senate for immediate consideration and discussion.
The eagerness for debate on the subject is shown by the record.
Thirty-four senators delivered speeches, most of them elaborately
prepared, going over the history of the precious metals, the field
of American legislation, and international practice in money.
The Senate refused to adopt Mr. Conkling's suggestion to make the
resolution _joint_ instead of _concurrent_ and thus require the
signature of the President. Mr. Matthews had framed it so as simply
to evoke an expression by both branches of Congress without sending it
to the Executive, whose opinions had just been made known through his
annual message. This was intended as an expression of dissent on
the part of Congress from the views of the President. Mr. Edmunds
moved an amendment declaring that "the bonds are payable in gold coin
or its equivalent, and that any other payment without the consent of
the creditor would be in violation of the public faith." It was
defeated--_ayes_ 18, _noes_ 44. On an amendment offered by Mr. Justin
S. Morrill, declaring that "the bonds will be payable in silver if the
Silver Bill becomes the law of the land," the division was _ayes_ 14,
_noes_ 41. On the passage of the resolution in the Senate, the _ayes_
were 43, the _noes_ 22. In the House of Representatives, the
resolution was passed under a suspension of the rules,--_ayes_ 189,
_noes_ 79. This proclamation of the financial creed of Congress was
made complete on the 28th of January, 1878.
On the 5th of the previous November, during the extra session, the
House passed, under a suspension of the rules, a bill for the free
coinage of silver dollars of 412½ grains, full legal tender for
all debts public and private. Mr. Richard P. Bland of Missouri was
the author of the measure. The vote upon it stood 163 _ayes_ to 34
_noes_, 93 members not voting. It was reported in the Senate with
amendments, in December, and its discussion was superseded for the
time by the resolution of Mr. Matthews. As reported from the Finance
Committee, it provided for a coinage of dollars of 412½ grains to
the extent of not less than $2,000,000 or more than $4,000,000 per
month; all seigniorage to accrue to the Treasury. A second section,
proposed by Mr. Allison of Iowa, authorized the President to invite
other nations to take part in a conference, and to appoint three
Commissioners to represent the United States, with a view to the
adoption of a common ratio for gold and silver.
The bill gave rise to a longer and broader discussion than that which
had occurred on Mr. Matthews' resolution. It was opened by Mr. Morrill
of Vermont. He pronounced the measure a "fearful assault upon the
public credit. It resuscitates the obsolete dollar which Congress
entombed in 1834, worth less than the greenback in gold, and yet to be
a full legal-tender." He thought that the causes of the depreciation
of silver were permanent. "The future price may waver one way or the
other, but it must finally settle at a much lower point. Nothing less
than National will and power can mitigate its fall."
--Mr. Wallace of Pennsylvania charged that the opponents of the bill,
were "taking a course for the abasement, depreciation and disuse of
silver. The supporters of the bill favor both gold and silver."
--Mr. Dawes dwelt on the uncertain commercial value of silver and on
the harm to the public credit threatened by the impending measure,
insisting that the cheapest money would be our only money.
--Mr. Beck of Kentucky submitted a proposition to direct the coinage
of "not less than $3,000,000 per month, or as much more as can be
coined at the mints of the United States."
--Mr. Morgan of Alabama said the law did not deal with commercial
values. It promised coin to the bondholder--coin of silver or coin of
gold.
--Mr. Thurman of Ohio thought that the contract provided for the
payment of public debts in coin of the standard of 1870, when the
dollar of 412½ grains was full legal-tender, and that such dollar
would approximate to gold in value.
--Mr. Kernan of New York said: "This bill does not proceed upon the
basis that we are to make a silver dollar equivalent to a gold dollar,"
and thought that the cheaper coin would inevitably drive out the gold
coin.
--Mr. Blaine submitted an argument "that gold and silver are the money
of the Constitution, the money in existence when the Constitution was
formed, and Congress had the right to regulate their relations." He
favored the coinage of "such a silver dollar as will not only do
justice among our citizens at home, but prove an absolute barricade
against the gold monometallists." He did not believe that "412½
grains of silver would make such a dollar."
--Mr. Davis of West Virginia favored the utilization of silver,
"because it is one of our chief products, will make the money known to
the Constitution more abundant, will relive distress, and lead back
to prosperity."
--Mr. McDonald of Indiana thought that "if no change had been made in
our coinage laws, no proposition would be made to change them now.
The Act of 1873 demonetizing the silver dollar made the pending
measure necessary."
--Mr. McPherson said that he was "charged by a large majority of the
people of New Jersey to remonstrate against the measure, which they
believe will retard prosperity, and throw a blot upon our National
integrity."
--Mr. Sargent of California, representing a mining State, opposed the
bill, "as against good faith, and against the interests of the
Government and of the people."
--Mr. Jones of Nevada supported the bill in a very elaborate speech.
He had an enthusiastic faith in silver as a circulating medium, and
had given a great deal of study to the question.
--Mr. Ingalls of Kansas argued "that the public debt is payable in
silver, and if the money unit should be established in the metal least
subject to fluctuation that metal is silver. Gold is the money of
monarchs, and was in open alliance with our enemies in the civil war."
--Mr. Lamar presented resolutions from the Legislature of his State,
instructing the senators and representatives to vote for the pending
measure. He explained that he could not comply with the instructions,
and would give the reasons for his vote to his own people.
--Mr. Allison of Iowa closed the debate, drawing the distinction
between free coinage as proposed in the House Bill, and limited coinage
as proposed in the Senate amendment. He dwelt on the invitation
for an International Monetary Conference. He recited the growing
demand for gold in Europe, and explained that "France ceased coining
silver because she already had in circulation as full legal-tender
from $350,000,000 to $400,000,000 in that coin."
In the course of the discussion the history of the Demonetizing Act
of 1873 was brought out, and the degree of attention, or rather
inattention, which was given to its passage,--On proceeding to vote
the Senate rejected an amendment by Mr. Morrill, providing that for
the first year only 25 per cent, and for the second year only 50 per
cent, of the duties should be receivable in silver.--The amendment of
Mr. Wilson "that $100,000,000 should be coined in silver dollars within
three years, and then the coinage should cease if bullion should be
more than three per cent below par," was also rejected.--The Senate
refused to agree to an amendment offered by Mr. Edmunds, "that
nothing in this section contained shall be construed to interfere with
the coinage of gold and of the subsidiary silver now authorized by
law."--The section providing for an International Conference was
adopted,--_ayes_, 40; _noes_, 30.--Several forms of amendment relative
to the legal-tender provision were suggested, but the phrase as it
appears in the law was preferred.--Amendments offered by Mr. Eaton,
Mr. Christiancy, Mr. Blaine, and Mr. Cameron of Wisconsin to increase
the amount of silver in the coin, so as to approximate it to the value
of the gold dollar, were severally rejected by large majorities.--After
providing, on Mr. Chaffee's motion, for certificates of not less than
$10 in exchange for silver coin deposited and redeemable in the same
on demand, the Senate passed the bill with its amendments, by _ayes_
48, _noes_ 21.
On the return of the bill to the House of Representatives debate began
on February 21st.--Mr. Phillips of Kansas advocated the double
standard with the ratio of metal properly determined, and he thought
this was done in the dollar of 412½ grains.--General Butler of
Massachusetts was in favor of insisting on the House bill for free
coinage, and was seconded by Mr. Atkins of Tennessee.--Mr. Bland was
willing to accept the Senate amendments and then pass a supplementary
measure for free coinage on an appropriation bill. He added: "If we
cannot do that I am in favor of issuing paper money enough to stuff
down the bondholders until they are sick."--Mr. Dwight of New York
sought to limit the legal-tender quality of the silver dollar to $50,
and for larger sums to make it receivable at its value in gold.--A
motion by Mr. Hewitt of New York to lay the bill on the table was
lost by _ayes_ 71, _noes_ 205. The several amendments of the Senate
were then adopted; that limiting coinage by 203 _ayes_, to 72 _noes_,
and that for an International Monetary Conference by _ayes_ 196, _noes_
71.(2) The concurrence of the House in these amendments passed the bill.
President Hayes returned the bill the House of Representatives with
his objections, on the 28th of February. He based his veto on the
proposition that "the silver dollar authorized is worth eight to
ten per cent less than it purports to be worth, and is made a legal
tender for debts contracted when the law did not recognize such coin
as lawful money. The effect would be to put an end to the receipt
of revenue in gold, and thus compel the payment of silver for both
the principal and interest of the public debt." This he thought would
be regarded as a grave breach of public faith: "It is my firm
conviction that if the country is to be benefitted by a silver coinage,
it can only be done by the issue of silver dollars of full value
which will defraud no man. A currency worth less than it purports to
be worth, will in the end defraud not only creditors, but all who
are engaged in legitimate business, and none more surely than those
who are dependent on their daily labor for their daily bread."
The House voted at once on the veto--passing the bill against the
objections of the President, by _ayes_ 196, to _noes_ 73. The vote
was taken in the Senate on the same day, without debate, and the bill
was passed over the veto by _ayes_ 46, _noes_ 19. The senators not
voting were paired. Had every senator been present and voted the
result would have been _ayes_ 53, _noes_ 23. New England, New York
and New Jersey supplied the principal part of the negative vote.
Mr. Bayard, Mr. Pinkney Whyte, Mr. Butler of South Carolina, and
Mr. Lamar were the senators from the South who voted in the negative.
Pennsylvania, the South and the West sustained the bill. The Pacific
coast was divided,--Mr. Booth supporting the bill and Mr. Sargent
opposing it. The only vote for the bill in either House from New
England was that of General Butler. The proportion and general
location of the votes in the House were about the same as in the Senate.
The opinions of senators and representatives were of three distinct
types. The majority believed, as the vote showed, in the policy of
coining silver dollars of full legal-tender, regardless of their
intrinsic equality of value with gold dollars,--thus creating two
metallic currencies differing in value for all purposes of commercial
interchange with the world, and keeping them at an equality of value
at home by the force of law. The great mass of the Democratic party
and a considerable number of Republicans joined in this view.
A small minority of both parties disbelieved in the use of silver as
money, except for subsidiary coins, with its legal-tender value limited
to small sums,--fifty dollars being the highest proposed, the majority
apparently favoring ten dollars.
A majority of Republicans and a minority of Democrats asserted the
necessity of maintaining silver coin at full legal-tender, but upon
the basis of equality in intrinsic value with the gold dollar. This
class feared the effect of an exclusively gold standard, while the
supply of gold, compared with the commercial demands of the world, is
relatively and rapidly growing less. They had seen the ratio of
gold-supply far beyond that of silver for a series of years following
1850, and then for a series of years the ratio of silver-supply in
excess of the supply of gold. The theory advanced by this class rested
upon the proposition that the dollar of commerce could not with safety
be exclusively based either upon the scarcer or upon the more plentiful
metal. An adjustment is required providing for the employment of
both metals--maintaining between them such fair equalization as would
not violently disturb the value of real property or of annual products,
and most important of all would secure a steadiness to the wages of
labor and a sound currency in which to recompense it. The supply of
both metals for two periods of sixteen years each (1850-1865 both
included and 1866-1881 both included) in the United States and in the
world at large may suggest some useful lessons.(3)
From the Silver Bill the public interest turned to the approaching day
of Specie Resumption, January 1, 1879. To the last month there had
been many doubters, but when the day came it was found that the
Treasury was fully prepared and the gold coin which had borne a premium
for the seventeen years of specie suspension was not now demanded even
by those who had been hoarding legal-tender notes for that express
purpose.
The result has proved that legislators and financiers were wisest who
had the largest faith in the resources of the nation. The legislation
proved to be adequate to the end in view, and resumption was achieved
with the least practicable disturbance of trade and the least
practicable depression to industry. The process of funding the debt
was of great assistance, as was the constant reduction of the
principal, which all the while drew our bonds from Europe and thus
reduced the amount due for foreign interest. The monthly charge for
interest had been in 1865 as high as $12,581,474.--a part payable in
paper. During the fiscal year ending with June, 1879, it was only
$6,981,148. It is obvious that from this source alone the Treasury
was greatly strengthened.
Generous credit was accorded to Secretary Sherman for the great
achievement. It seldom happens that the promoter of a policy in
Congress had the opportunity to carry it out in an Executive
Department. But Mr. Sherman was the principal advocate of the
Resumption Bill in the Senate, and during the two critical years
preceding the day for coin payment he was at the head of the Treasury
Department. He established a financial reputation not second to that
of any man in our history.
During the period of the Crimean war (1854-6), the mercantile marine of
the United States gained so rapidly that it approached equality with
that of England, in tonnage. But even before the calamities of our
civil war, a change was foreshadowed favorable to England, hostile to
the United States. It was the change from sail to steam. The
utilization of iron as a ship-building material, the cheapening of
fuel, the superior speed, all betokened a radical change in
transportation on the principal ocean routes of the world. From the
close of 1856 to the outbreak of the rebellion the average loss to
the Navigation interests of the United States was two per cent
annually. This ratio of loss was immensely accelerated by the course
of events during the civil war, involving the utter destruction of
many American vessels or their change of flag. The natural result was
that in the spring of 1865 we stood in the carrying trade relatively
and absolutely far behind our position in 1855.
Practically, nothing has since been done to recover the lost ground.
Provision was made by Congress for the admission of certain ship-building
materials free of duty. This somewhat improved the prospects and
stimulated the construction of sailing vessels; but the competition
in the world's carrying-trade is in steam-vessels. Great Britain had
for many years covered the ocean with subsidized steamers, paying
heavily for mail service until the lines were self-supporting, and
withdrawing her aid only when competition could be safely defied.
Congress steadily refused to enter upon any system of the same kind.
Fitful aid was granted to special lines here and there, but no general
system was devised, and the aid extended being temporary and
accompanied sometimes by scandals in legislation was in the end rather
hurtful than helpful.
Meanwhile the products we were exporting and importing enlarged so
rapidly that we were giving more cargoes to ships than any other
nation of the world,--furnishing in the year 1879 between thirteen
and fourteen million tons of freight, and this altogether exclusive of
our coasting trade. Some very extreme cases occurred, strikingly
illustrative of the reluctance of Congress to help the American
carrying trade. It was shown by statistics that we were exporting
to Brazil not over $7,000,000 of our own products, and taking from her
over $40,000,000 of her products. We had no steam communication with
Rio Janeiro, except by way of Europe. In 1876 the Emperor of Brazil,
an able and enlightened monarch, visited the United States. As a
result of his inquiries and examinations His Majesty expressed a
sincere desire for closer commercial connections between the two
countries, and eagerly spoke of his willingness to contribute by an
annual bounty to the establishment of a line of steamers.
After the Emperor's return to his dominions John Roach (a native of
Ireland, but long naturalized in the United States), an energetic
and capable ship-builder, of unusual foresight, energy, and integrity
of purpose, sent an agent to Rio Janeiro, and procured a contract
from the Brazilian Government pledging $125,000 per annum, provided
the Government of the United States would give the same amount, for
the establishment of a steam line between the two countries. Not
doubting the readiness of the American Government to respond, Mr.
Roach proceeded with full confidence, and built vessels for the line
in his own shipyard. The enterprise promised the best commercial
results; but to his chagrin and discomfiture, Mr. Roach found that no
amount of argument or appeal by those who were willing to speak for him
could induce Congress to contribute a single dollar for the
encouragement of the line. Brazil cancelled her offer when the United
States refused to join with her. Mr. Roach's ships were withdrawn,
and the line was surrendered to an inferior class of English steamers.
During the period of this futile experiment, as well as before and
afterwards, Congress annually appropriated more than a million dollars
for the maintenance of the South-American squadron of naval vessels,
to protect a commerce that did not exist, and for the creation of which
the United-States Government was unwilling to pay even ten per cent
of the cost annually of maintaining the squadron. Every intelligent
man knows that it is impossible to maintain a navy unless there be a
commercial marine for the education of sailors. The American marine
preceding 1861 was so large that it could furnish seventy-six thousand
sailors to maintain a blockading squadron on the South Atlantic and
Gulf coasts. The value of this school for seamen, as one of the arms
for National defense, could not have been more strikingly illustrated,
or more completely proved. The lesson should have been heeded. It is
a familiar adage requiring no enforcement of argument, that navies do
not grow at the top. They grow from and out of a commercial marine
that educates men for sea service. If the Government of the United
States had, since the close of the war, expended annually upon the
mercantile marine one-fifth of the amount that has been expended upon
the Navy, our ships would have covered every sea, and the Navy would
have grown of itself. Instead of that, we have been constructing the
navy as an exotic, forcing it to grow without a favoring atmosphere,
establishing it with officers and not with men, educating cadets on
land, and not educating sailors on the ocean.
The Democratic party in Congress was hostile to every movement for the
encouragement of our carrying trade, and the Republican party was
fatally divided. The men who had earnestly attempted to do something
were therefore constantly defeated and compelled to abandon the effort.
Following this came the demand for the ships, which meant simply that
American capitalists might secure the registry of the United States
for vessels built in English ship-yards and manned with English
sailors. This is the last movement necessary to complete the dominion
of Great Britain over the sea, to complete the humiliation of the
United States as a commercial country. It would abolish the art of
ship-building on this side of the Atlantic, would educate no American
sailor, except in the coasting trade. As a result, our naval vessels,
if a Navy should be maintained, would necessarily be constructed where
the merchant vessels were constructed; and the last point of absurdity
in this policy would be reached when, in case of possible conflict with
a European Power, we should be dependent for naval vessels upon a
foreign country from which we could be cut off by the superior strength
of our opponent on the sea.
With a more extended frontage on the two great oceans of the world than
any other nation; with a larger freightage than that of any other
nation, it will be a reproach to the United States, more pointed and
decisive every year, if it neglects to establish a policy which shall
develop a mercantile marine, and as the outgrowth of the mercantile
marine, a Navy adequate to all the wants of the Republic. If Congress,
in the sixteen years following the war, had given a tithe of
encouragement to the building and sailing of ships, that it has wisely
given to manufactures, to the construction of railways, and to every
industrial pursuit on land, our flag would before the close of that
period have stood relatively on the ocean as strong and permanent as
it stood before steam was applied to the carrying trade of the world.
In those sixteen years the Government expended more than three hundred
millions on the Navy!(4) It expended scarcely three millions to aid in
building up its mercantile marine, and expended much of that unwisely.
[(1) The Louisiana Commission was composed as follows:
General Joseph R. Hawley of Connecticut, Judge Charles B. Lawrence of
Ohio, General John M. Harlan of Kentucky, Ex-Governor John C. Brown of
Tennessee, Hon. Wayne McVeagh of Pennsylvania.]
[(2) The International Monetary Conference for which provision was made
in the bill was held at Paris in the autumn of 1878. The American
Commissioners were Reuben K. Fenton, William S. Groesbeck, and Francis
A. Walker, with S. Dana Horton as Secretary. The principal European
Nations were present with the exception of Germany. The Commissioners
receive the impression that decided progress had been made towards the
remonetization of silver in Europe, but subsequent event have not
vindicated their judgment. Mr. Goschen, who was the head of the
British delegation, declared that "it would be a misfortune for the
world if a movement for a sole gold standard should succeed;" but he
indicated no purpose on the part of his own government to change from
the gold standard. The Conference came to no practical conclusion,
simply agreeing that "it is necessary to maintain in the world the
monetary functions of silver as well as those of gold;" but that "the
selection for use of one or the other of the two metals, or both
simultaneously, should be governed by the special position of each
State or group of States." The proposition of the United States "that
the delegations recommend to their respective governments the
adjustment of a fixed relation between the two metals and the use of
both in that relation as unlimited legal-tender money," was rejected.
The supporters of a bi-metallic standard, though disappointed in the
immediate result of the Conference, received encouragement from the
advance in International opinion in the years that had elapsed since
the previous Conference (1867). At that time the Nations declared
almost unanimously in favor of a single standard of gold. Many of
them had found in the interval great difficulty in maintaining it and
were withheld from declaring for the double standard simply by the
influence and example of England.]
[(3) The following tables have been prepared with care by Hon. A. Loudon
Snowden, the able superintendent for several years of the United States
Mint at Philadelphia.
ANNUAL PRODUCTION OF GOLD AND SILVER IN THE UNITED STATES, FROM
1850 TO 1881, INCLUSIVE.
YEARS. GOLD. SILVER. YEARS. GOLD. SILVER.
1850 . . . $50,000,000 $50,000 1866 . . . $53,500,000 $10,000,000
1851 . . . 55,000,000 50,000 1867 . . . 51,725,000 13,500,000
1852 . . . 60,000,000 50,000 1868 . . . 48,000,000 12,000,000
1853 . . . 65,000,000 50,000 1869 . . . 49,500,000 12,000,000
1854 . . . 60,000,000 50,000 1870 . . . 50,000,000 16,000,000
1855 . . . 55,000,000 50,000 1871 . . . 43,500,000 23,000,000
1856 . . . 55,000,000 50,000 1872 . . . 36,000,000 28,750,000
1857 . . . 55,000,000 50,000 1873 . . . 36,000,000 35,750,000
1858 . . . 50,000,000 500,000 1874 . . . 33,500,000 37,300,000
1859 . . . 50,000,000 100,000 1875 . . . 33,500,000 31,700,000
1860 . . . 46,000,000 150,000 1876 . . . 39,930,000 38,780,000
1861 . . . 43,000,000 2,000,000 1877 . . . 46,900,000 39,800,000
1862 . . . 39,200,000 4,500,000 1878 . . . 51,200,000 45,281,000
1863 . . . 40,000,000 8,500,000 1879 . . . 38,900,000 40,800,000
1864 . . . 46,100,000 11,000,000 1880 . . . 36,000,000 39,200,000
1865 . . . 53,225,000 11,250,000 1881 . . . 30,650,000 43,150,000
Total. . $822,525,000 $38,400,000 Total. . $678,805,000 $467,011,000
Total Gold for thirty-two years, $1,501,330,000. Total Silver, $505,411,000
ANNUAL PRODUCTION OF GOLD AND SILVER IN THE WORLD, EXCLUSIVE OF THE
UNITED STATES, FROM 1850 TO 1881, INCLUSIVE.
YEARS. GOLD. SILVER. YEARS. GOLD. SILVER.
1850 . . . $15,000,000 $39,500,000 1866 . . . $67,600,000 $40,750,000
1851 . . . 12,600,000 39,950,000 1867 . . . 52,300,000 40,725,000
1852 . . . 72,750,000 40,550,000 1868 . . . 61,725,000 38,225,000
1853 . . . 90,450,000 40,550,000 1869 . . . 56,725,000 35,500,000
1854 . . . 67,450,000 40,550,000 1870 . . . 56,850,000 35,575,000
1855 . . . 80,075,000 40,550,000 1871 . . . 63,500,000 38,050,000
1856 . . . 82,600,000 40,600,000 1872 . . . 63,600,000 36,500,000
1857 . . . 78,275,000 40,600,000 1873 . . . 60,200,000 53,500,000
1858 . . . 74,650,000 40,150,000 1874 . . . 57,250,000 34,200,000
1859 . . . 74,850,000 40,650,000 1875 . . . 64,000,000 48,800,000
1860 . . . 73,250,000 40,650,000 1876 . . . 63,770,000 48,820,000
1861 . . . 70,800,000 42,700,000 1877 . . . 67,100,000 41,200,000
1862 . . . 68,550,000 40,700,000 1878 . . . 67,800,000 49,519,000
1863 . . . 66,950,000 40,700,000 1879 . . . 69,800,000 55,200,000
1864 . . . 66,900,000 40,700,000 1880 . . . 70,400,000 57,500,000
1865 . . . 66,975,000 40,700,000 1881 . . . 65,800,000 62,800,000
Total $1,072,125,000 $649,800,000 Total $1,008,420,000 $716,864,000
Total Gold, $2,080,545,000. Total Silver, $1,366,664,000.
TOTAL FOR THE WHOLE WORLD.
GOLD. SILVER.
1850-1856 . . . . . . . . . . . . . . . $1,894,650,000 $ 688,200,000
1866-1881 . . . . . . . . . . . . . . . 1,687,225,000 1,183,875,000]
[(4) The Naval expenditures for the sixteen years following the war
were as follows:--
Four years under President Johnson . . . . . $114,500,000
Eight years under President Grant . . . . . 154,500,000
Four years under President Hayes . . . . . . 57,000,000]