Recollections of Forty Years in the House, Senate and Cabinet An Autobiography. (part 3 of 7)

Recollections of Forty Years in the House, Senate and Cabinet An Autobiography. (part 3 of 7)

'Sir:--As I occupy a quasi military position under the laws of the state, I deem it proper to acquaint you that I accepted such position when Louisiana was a state in the union and when the motto of this seminary was inscribed in marble over the main door: "By the liberality of the General Government. The Union Esto perpetua." Recent events foreshadow a great change, and it becomes all men to choose. If Louisiana withdraw from the federal Union, I prefer to maintain my allegiance to the old constitution as long as a fragment of it survives, and my longer stay here would be wrong in every sense of the word. In that event, I beg that you will send or appoint some authorized agent to take charge of the arms and munitions of war here belonging to the state, or advise me what disposition to make of them. And furthermore, as president of the board of supervisors, I beg you to take immediate steps to relieve me as superintendent the moment the state determines to secede; for on no earthly account will I do any act or think any thought hostile to, or in defiance of, the United States.

'With respect, etc., 'W. T. Sherman.'

"I regard the seizure by Governor Moore of the United States arsenal as the worst act yet committed in the present revolution. I do think every allowance should be made to southern politicians for their nervous anxiety about their political powers and the safety of slaves. I think that the constitution should be liberally construed in their behalf, but I do regard this civil war as precipitated with undue rapidity. . . . It is inevitable. All legislation now would fall powerless on the south. You should not alienate such states as Virginia, Kentucky, Tennessee, and Missouri. My notice is that this war will ruin all politicians, and that military leaders will direct the events.

"Yours "W. T. S."

On the first of February he wrote as follows:

"I have felt the very thoughts you have spoken. It is war to surround Anderson with batteries, and it is shilly-shally for the south to cry 'Hands off! No coercion!' It was war and insult to expel the garrison at Baton Rouge, and Uncle Sam had better cry 'Cave!' or assert his power. Fort Sumter is not material save for the principle; but Key West and the Tortugas should be held in force at once, by regulars if possible, if not, by militia. Quick! They are occupied now, but not in force. While maintaining the high, strong ground you do, I would not advise you to interpose an objection to securing concessions to the middle and moderate states, --Virginia, Kentucky, Tennessee and Missouri. Slavery there is local, and even if the world were open to them, its extension would involve no principle. If these states feel the extreme south wrong, a seeming concession would make them committed. The cotton states are gone, I suppose. Of course, their commerce will be hampered. . . .

"But of myself. I sent you a copy of my letter to the Governor. Here is his answer:

'Dear Sir:--It is with the deepest regret I acknowledge the receipt of your letter of the 18th instant. In the pressure of official business I can only request you to transfer to Professor Smith the arms, munitions, and funds in your hands, whenever you conclude to withdraw from the position you have filled with so much distinction. You cannot regret more than I do the necessity which deprives us of your services, and you will bear with you the respect, confidence, and admiration of all who have been associated with you.

'Very truly, your friend and servant, 'Thos. D. Moore.'

"This is very handsome, and I do regret this political imbroglio. I do think it was brought about by politicians. The people in the south are evidently unanimous in the opinion that slavery is endangered by the current of events, and it is useless to attempt to alter that opinion. As our government is founded on the will of the people, when that will is fixed, our government is powerless, and the only question is whether to let things slide into general anarchy, or the formation of two or more confederacies which will be hostile sooner or later. Still, I know that some of the best men of Louisiana think this change may be effected peacefully. But even if the southern states be allowed to depart in peace, the first question will be revenue.

"Now, if the south have free trade, how can you collect revenues in the eastern cities? Freight from New Orleans to St. Louis, Chicago, Louisville, Cincinnati, and even Pittsburg, would be about the same as by rail from New York, and importers at New Orleans, having no duties to pay, would undersell the east if they had to pay duties. Therefore, if the south make good their confederation and their plan, the northern confederacy must do likewise or blockade. Then comes the question of foreign nations. So, look on it in any view, I see no result but war and consequent changes in the form of government."

These letters, written at their dates, on the spur of the moment, present the condition of affairs as viewed by General Sherman and myself when they occurred.

With the conviction just stated General Sherman came to Washington about the time of my election to the Senate. He was deeply impressed with the certainty of war and of its magnitude, and was impelled by the patriotic sentiment that, as he had been educated at the expense of the government for military service, it was his duty, in the then condition of the country, to tender his services. I therefore escorted him to the White House. His statement of the interview given in his "Memoirs" is not very full, for, while Mr. Lincoln did say, in response to his tender, "I guess we will manage to keep house," he also expressed a hope, which General Sherman knew to be delusive, that the danger would pass by and that the Union would be restored by a peaceful compromise. This was, undoubtedly, the idea then uppermost in the minds of both the President and Mr. Seward. At this time the public mind in the north was decidedly in favor of concessions to the south. The Democrats of the north would have agreed to any proposition to secure peace and the Union, and the Republicans would have acquiesced in the Crittenden Compromise, or in any measure approved by Lincoln and Seward.

The period between the 4th of March and the 12th of April was the darkest one in the history of the United States. It was a time of humiliation, timidity and feebleness. Fortunately for the future of our country the rebels of the south were bent upon disunion; they were hopeful and confident, and all the signs of the times indicated their success. They had possession of all the forts of the south, except Fortress Monroe, Fort Sumter, and two remote forts in Florida. They had only to wait in patience, and Fort Sumter would necessarily be abandoned for want of supplies. Fortress Monroe could not be held much longer by the regular army, weakened as it was by the desertion of officers and men, and public sentiment would not justify a call for troops in advance of actual war. The people of South Carolina were frenzied by their success thus far, and, impatient of delay, forced an attack on Fort Sumter, then held by a small garrison under command of Major Robert Anderson. The first gun fired on the 12th of April, 1861, resounded throughout the United States and the civilized world, touching an electric chord in every family in the northern states and changing the whole current of feeling. From this time forth, among the patriotic people of the loyal states, there was no thought or talk of compromise. That this insult to our flag must be punished, "that the Union must and shall be preserved," were the resolves of millions of men, without respect to party, who but the day before were eager for compromise. The cold and cautious men of the north were at last awakened from their indifference.

The impression made upon my mind by the attack on Fort Sumter is expressed in a letter I wrote from Washington to my brother, General Sherman, as he was then called, at midnight of the 12th of April:

"Washington, April 12, 1861. "Dear Brother:--I was unexpectedly called here soon after receiving your letter of the 8th, and at midnight write you. The military excitement here is intense. Since my arrival I have seen several officers, many citizens, and all the heads of departments except Blair. There is a fixed determination now to preserve the Union and enforce the laws at all hazards. Civil war is actually upon us, and, strange to say, it brings a feeling of relief; the suspense is over. I have spent much of the day in talking about you. There is an earnest desire that you go into the war department, but I said this was impossible. Chase is especially desirous that you accept, saying that you would be virtually Secretary of War, and could easily step into any military position that offers.

"It is well for you seriously to consider your conclusion, although my opinion is that you ought not to accept. You ought to hold yourself in reserve. If troops are called for, as they surely will be in a few days, organize a regiment or brigade, either in St. Louis or Ohio, and you will then get into the army in such a way as to secure promotion. By all means take advantage of the present disturbances to get into the army, where you will at once put yourself in a high position for life. I know that promotion and every facility for advancement will be cordially extended by the authorities. You are a favorite in the army and have great strength in political circles. I urge you to avail yourself of these favorable circumstances to secure your position for life; for, after all, your present employment is of uncertain tenure in these stirring times.

"Let me now record a prediction. Whatever you may think of the signs of the times, the government will rise from this strife greater, stronger, and more prosperous than ever. It will display energy and military power. The men who have confidence in it, and do their full duty by it, may reap whatever there is of honor and profit in public life, while those who look on merely as spectators in the storm will fail to discharge the highest duty of a citizen, and suffer accordingly in public estimation. . . .

"I write this in great hurry, with numbers around me, and exciting and important intelligence constantly repeated, even at this hour; but I am none the less in earnest. I hope to hear that you are on the high road to the 'General' within thirty days.

"Affectionately your brother, "John Sherman."

Two days later I wrote him:

"Washington, Sunday, April 14, 1861. "Dear Brother:--. . . The war has really commenced. You will have full details of the fall of Sumter. We are on the eve of a terrible war. Every man will have to choose his position. You fortunately have a military education, prominence, and character, that will enable you to play a high part in the tragedy. You can't avoid taking such a part. Neutrality and indifference are impossible. If the government is to be maintained, it must be by military power, and that immediately. You can choose your own place. Some of your best friends here want you in the war department; Taylor, Shiras, and a number of others, talk to me so. If you want that place, with a sure prospect of promotion, you can have it, but you are not compelled to take it; but it seems to me you will be compelled to take some position, and that speedily. Can't you come to Ohio and at once raise a regiment? It will immediately be in service. The administration intends to stand or fall by the Union, the entire Union, and the enforcement of the laws. I look for preliminary defeats, for the rebels have arms, organization, unity; but this advantage will not last long. The government will maintain itself or our northern people are the veriest poltroons that ever disgraced humanity.

"For me, I am for a war that will either establish or overthrow the government and will purify the atmosphere of political life. We need such a war, and we have it now. . . .

"Affectionately yours, "John Sherman."

He wrote in reply:

"The time will come in this country when professional knowledge will be appreciated, when men that can be trusted will be wanted, and I will bide my time. I may miss the chance; if so, all right; but I cannot and will not mix myself in this present call. . . .

"The first movements of the government will fail and the leaders will be cast aside. A second or third set will rise, and among them I may be, but at present I will not volunteer as a soldier or anything else. If Congress meet, or if a national convention be called, and the regular army be put on a footing with the wants of the country, if I am offered a place that suits me, I may accept. But in the present call I will not volunteer."

He criticised the call for 75,000 militia for three months, saying that the best of men could only be made indifferent soldiers in three months, and that the best of soldiers could accomplish nothing in three months in such a country as ours. He therefore would not volunteer for such a service, but his mind was occupied with military plans. The correspondence between us shows that he had a better conception of the magnitude and necessities of the war than civilians like myself.

He wrote to Mr. Cameron, Secretary of War, from St. Louis, on May 8, 1861:

"I hold myself now, as always, prepared to serve my country in the capacity for which I was trained. I did not and will not volunteer for three months, because I cannot throw my family on the cold support of charity, but for the three years' call made by the President an officer could prepare his command and do good service. I will not volunteer, because, rightfully or wrongfully, I feel myself unwilling to take a mere private's place, and having for many years lived in California and Louisiana, the men are not well enough acquainted with me to elect me to my appropriate place. Should my services be needed, the record or the war department will enable you to designate the station in which I can render best service."

When Mr. Lincoln was elected President, there was no general feeling among the northern people that war would result from his election. It was not believed, although it had been threatened, that the southern states would take up arms to resist the accession of a President not of their choice. The love of Union and the orderly obedience to constituted authority had been so well established among our people that, while politicians might threaten, but few really believed that war, of which they knew nothing, was to come upon us. The result was that when the southern states, one by one, seceded, and Fort Sumter was fired upon, and the forts and arsenals of the south were captured, a new inspiration dawned upon the people of the north, a determination became general that, cost what it would, the Union should be preserved to our children and our children's children. That feeling was not confined to party lines. I am bound to say that the members of the Democratic party in the loyal States, in the main, evinced the same patriotic determination to maintain the cause of the Union, as those of the Republican party. Their sons and their kindred formed part of every regiment or force raised in the United States.

At this distance of time from the opening of the Civil War, I have endeavored to take an impartial retrospect of the causes that led the south to engage therein. Undoubtedly, the existence of negro slavery in the south was the governing excitement to war. The owners of slaves knew that the tenure of such property was feeble. Besides the danger of escape, there was the growing hostility to slavery in a preponderance of the people of the United States, restrained only by its recognition by the constitution. The slave owners believed that, by secession, they could establish a republic, founded on slavery, with an ample field in Mexico and Central America for conquest and expansion. They had cultivated a bitter sectional enmity, amounting to contempt, for the people of the north, growing partly out of the subserviency of large portions of the north to the dictation of the south, but chiefly out of the wordy violence and disregard of constitutional obligation by the Abolitionists of the north. They believed in the doctrine of an irrepressible conflict long before it was announced by Seward.

South Carolina, far in advance of other southern states, led in promulgating the legal rights of secession, until they came to be acquiesced in by all these states. They committed themselves to it in the Charleston convention. Their speakers declared, during the canvass, that if Lincoln was elected, their states would secede. When elected, the first gun was fired on Fort Sumter, in South Carolina, where all the people were determined on war. The struggle once commenced, the natural sympathy of the southern states was with South Carolina. The States of Virginia, North Carolina and Tennessee, where a strong Union sentiment prevailed, hesitated and delayed, but the young and active spirits were with the south, and these carried the states named into the general conflict. Once in the war, there was no way but to fight it out. I have no sympathy with secession, but I can appreciate the action of those who were born and reared under the influence of such teachings. Who of the north can say, that in like conditions, he would not have been a rebel?

Looking back from my standpoint now, when all the states are re- united in a stronger Union, when Union and Confederate soldiers are acting together in both Houses of Congress in legislating for the common good, when, since 1861, our country has more than doubled its population and quadrupled its resources, when its institutions have been harmonized by the abolition of slavery, when the seceding states are entering into a friendly and hopeful rivalry, in the development of their great resources, when they have doubled or trebled their production of cotton, when they are producing the greater part of their food, when they are developing their manufactures of iron and steel, and introducing the spindle and loom into the cities and villages, it seems to me that men of the south surely will appreciate, if they do not approve, what I said in the Senate early in the war:

"I would stake the last life, the last dollar, the last man, upon the prosecution of the war. Indeed, I cannot contemplate the condition of my country if it shall be dissevered and divided. Take the loyal states as they now stand and look at the map of the United States, and regard two hostile confederacies stretching along for thousands of miles across the continent. Do you not know that the normal condition of such a state of affairs would be eternal, everlasting war? Two nations of the same blood, of the same lineage, of the same spirit, cannot occupy the same continent, much less standing side by side as rival nations, dividing rivers and mountains for their boundary. No, Mr. president, rather than allow this war to terminate except upon the restoration of the Union intact in all its breadth and length, I would sacrifice the last man and see the country itself submerged.

"Rather than yield to traitors or the intervention of foreign powers, rather than bequeath to the next generation a broken Union, and an interminable civil war, I would light the torch of fanaticism and destroy all that the labor of two generations has accumulated. Better a desert and universal poverty than disunion; better the war of the French Revolution than an oligarchy founded upon the labor of slaves. But, sir, there is no need of this. The resources, wealth, and labor of twenty millions of freemen are amply sufficient to meet not only the physical, but financial, difficulties of the war. Thank God! the test to which all nations in the course of their history are subjected, is applied to us when we have a insignificant national debt; when our resources were never more manifest; when the loyal states are so throughly united; when our people are filled with a generous enthusiasm that will make the loss of life and burden of taxation easy to bear. If we conquer a peace by preserving the Union, the constitution, our nationality, all our ample territories, the rebound of prosperity in this country will enable a single generation easily to pay the national debt, even if the war is protracted until desolation is written upon every rebel hearthstone."

This, I believe, expressed the spirit and determination of the loyal states of the north, at the beginning of the war. With opinions so widely divergent in the two sections, and with a fixed purpose of each to stand by them, there was no way that poor frail human nature could devise to decide the controversy except to fight.

From the graves of the dead, who fought on opposite sides for their country of their state, there has been a resurrection, honorable to both sections, a Union stronger, more united and glorious than the Union established by our fathers, and with a rebound of prosperity greater than we could conceive of in 1862. This war, though fearful in the sacrifice of property and life, has resulted in a better understanding among the people of both sections. Each has for the other a higher respect and regard. I sincerely hope and believe in the good time coming when sectional lines will not divide political parties, and common interests and a broader nationality will have destroyed sectional feeling and jealousy.

As the result of the war we command the respect of all foreign nations. The United States, as a great republic, has become an example already followed by European nations. It has at least secured the respect and forbearance of the ruling class in Great Britain, who never forgot or forgave the rebellion of our ancestors against King George III and the parliament of Great Britain. It has stamped the language, the laws, and the boasted freedom of Englishmen, upon a population double that in the mother country, and they, in turn, are taking lessons from us in extending to their people equality of rights and privileges.

I remained in Washington a few days and then started for my home at Mansfield, to encourage enlistments, but found that no help was needed; that companies were enlisted in a day. One was recruited by William McLaughlin, a gallant soldier in the war in Mexico, a major general of the Ohio militia who had arrived at the age of sixty years. He dropped his law books and in twelve hours had a company of one hundred men ready to move at the command of the governor. A like patriotism was aroused in all parts of the state, so that in a very short time two full regiments, numbering 2,000 men, were organized under the command of Colonel A. McD. McCook, of the United States army, and were on the way to Washington, then blockaded by the roughs of Baltimore. I met them at Harrisburg and went with them to Philadelphia. They were camped at Fairmount Park, and were drilled with other regiments by Colonel Fitz John Porter, the entire force being under the command of General Patterson.

When the blockade was opened, by the skill and audacity of General Benjamin F. Butler, the two Ohio regiments were ordered to Washington and were there reviewed by President Lincoln, at which time a pleasant incident occurred which may be worthy of mention. I accompanied the President to the parade, and passed with him down the line. He noticed a venerable man with long white hair and military bearing, standing in position at the head of his company with arms presented, and inquired his name. I said it was General McLaughlin and hurriedly told him his history, his politics and patriotism. The President, as he came opposite him, stopped, and leaving his party advanced to McLaughlin and extended his hand. McLaughlin, surprised, had some difficulty in putting his sword under his left arm. They shook hands and Lincoln thanked him, saying when men of his age and standing came to the rescue of their country there could be no doubt of our success. McLaughlin highly appreciated this compliment. He afterwards enlisted for the war and died in the service of his country.

These two regiments were subsequently ordered to Harrisburg, to which place they went, accompanied by me, and there they formed a part of the command of General Patterson, which was to advance on Martinsburg and Winchester to aid in a movement of General McDowell against the enemy at Bull Run. I was serving on the staff of General Patterson as a volunteer aid without pay. While at Harrisburg it was suggested to me that ex-President Buchanan, then at his country home near that city, had expressed a wish to see me. As our personal relations had always been pleasant, though our political opinions were widely different, I called upon him, I think with Colonel Porter, and we were cordially received. I was surprised at the frankness and apparent sincerity of the opinions expressed by him in relation to the war. He said he had done all he could to prevent the war, but now that it was upon us it was the duty of all patriotic people to make it a success, that he approved all that had been done by Mr. Lincoln, of whom he spoke in high terms of praise. I believe he was sincere in the opinions he then expressed, and know of nothing said or done by him since that time that could create a doubt of his sincerity.

About the middle of June the command of General Patterson moved slowly to Chambersburg, where it remained several days under constant drill, then to Hagerstown and to the village of Williamsport on the Potomac. While at the latter place General Sherman, who had been at Washington and received his commission as colonel of the 13th United States infantry, then being recruited, came to visit me at my lodgings in a country tavern. He then met for the first time in many years his old classmate, Colonel, afterwards Major- General, George H. Thomas, who then commanded a regular regiment of the United States army in the force under the command of General Patterson. The conversation of these two officers, who were to be so intimately associated in great events in the future, was very interesting. They got a big map of the United States, spread it on the floor, and on their hands and knees discussed the probable salient strategic places of the war. They singled out Richmond, Vicksburg, Nashville, Knoxville and Chattanooga. To me it has always appeared strange that they were able confidently and correctly to designate the lines of operations and strategic points of a war not yet commenced, and more strange still that they should be leading actors in great battles at the places designated by them at this country tavern.

The next day General Thomas crossed the river into Virginia, but the order was soon countermanded, it is said, by General Scott, and General Thomas returned to the north bank of the Potomac. General Sherman returned to Washington to drill his raw troops for the battle of Bull Run. I soon after returned by stage to Frederick, Maryland, to take my seat in the Senate, Congress having been convened to meet in special session on the 4th of July.

CHAPTER XI. SPECIAL SESSION OF CONGRESS TO PROVIDE FOR THE WAR. Condition of the Treasury Immediately Preceding the War--Not Enough Money on Hand to Pay Members of Congress--Value of Fractional Silver of Earlier Coinage--Largely Increased Revenues an Urgent Necessity --Lincoln's Message and Appeal to the People--Issue of New Treasury Notes and Bonds--Union Troops on the Potomac--Battle of Bull Run-- Organization of the "Sherman Brigade"--The President's Timely Aid --Personnel of the Brigade.

To understand the measures to be submitted to Congress at its approaching session, it is necessary to have a clear conception of the condition of the treasury at that time, and of the established financial policy of the government immediately before the war.

On the meeting of Congress in December, 1860, the treasury was empty. There was not enough money even to pay Members of Congress. The revenues were not sufficient to meet the demands for ordinary expenditures in time of peace. Since 1857 money had been borrowed by the sale of bonds and the issue of treasury notes bearing interest, to meet deficiencies. The public debt had increased during the administration of Mr. Buchanan about $70,000,000. The Secretary of the Treasury, Howell Cobb, resigned on the 10th of December, 1860, declaring that his duty to Georgia required such action. He had aided in every possible way to cripple the department while in charge of it.

On the 16th of the same month Congress authorized the issue of $10,000,000 treasury notes, to bear interest at the lowest rate bid. On the 18th Secretary Philip F. Thomas, Mr. Cobb's successor, invited bids for $5,000,000 of treasury notes, part of the $10,000,000 authorized, at the rate of interest offered by the lowest bidder. Offers at 12 per cent. or less were made for $1,831,000 (the bulk of the offers being at 12 per cent.) which were accepted and additional offers were received at interest varying from 15 to 36 per cent., but were refused. Immediately after the decision of the department on these offers was announced, the assistant treasurer at New York advised the secretary that certain parties would take the residue of the $5,000,000 offered, through the Bank of Commerce, at 12 per cent. This proposition was accepted, on condition that the amount required to make up the five millions should be deposited without delay. The whole amount was applied to the payment of overdue treasury notes and other pressing demands on the treasury.

Secretary Thomas resigned on the 11th of January, 1861, and John A. Dix became Secretary of the Treasury. In answer to my inquiry Secretary Dix, in an official letter, dated January 18, 1861, stated the terms of the sale of treasury notes and that: "The amount required to meet the outstanding current and accruing dues before the close of the present fiscal year, besides any additional charges on the treasury created by legislation during the present session of Congress, is $44,077,524.63." He recommended a further issue of $25,000,000 of bonds, and suggested that the states which had received deposits under the act for the distribution of surplus revenue in General Jackson's time might be called upon to return such deposits, and added: "If, instead of calling for these deposits, it should be deemed advisable to pledge them for the repayment of any money the government might find it necessary to borrow, a loan contracted on such a basis of security, superadding to the plighted faith of the United States that of the individual states, could hardly fail to be acceptable to capitalists."

In this connection I received the following note:

"Treasury Department, February 6, 1861. "Hon. John Sherman.

"Dear Sir:--I send a preamble and resolution, and a letter to your governor. Will you read and send them at once? You, as a Member of Congress, can say what I cannot with propriety--that no states which guarantee bonds of the United States to the amount of the public moneys in its hands, will be likely to be called on to repay these moneys--at all events during the twenty years the bonds of the United States will run.

"I am truly yours, "John A. Dix. "P. S.--I cannot put out my notice for a loan till your state acts, and the time is very short."

Subsequently I received the following letter:

"Treasury Department, February 11, 1861, 7 p. m. "Dear Sir:--My plan for raising money to meet the outstanding liabilities of the government, and to enable the incoming administration to carry on its financial operations without embarrassment till it shall have time to mature a plan for itself, has met with an obstacle quite unexpected to me. The committee of ways and means in the House has declined to report a bill to authorize me to accept the guaranties voluntarily tendered by the states. Mr. Spaulding, of New York, and Mr. Morrill, of Vermont, I learn, have objections. Unless they withdraw their opposition the bill cannot be reported, and the plan must fail. In that case I shall not deem it proper to ask for a loan of more than two millions to meet the redemption of treasury notes, which fall due before the 4th of March. The state of the country is such that a larger amount thrown on the market would have a most disastrous influence on the public credit. I do not think I can borrow two millions at more than 90 per cent. With a guaranty such as the states have offered, I can get eight millions at par. The alternative is to authorize me to accept the guaranty, or leave the treasury with scarcely anything in it and with outstanding demands, some of them very pressing, of at least six millions of dollars, for you and your political friends to provide for. If anything is done it should be to-morrow, as I ought to publish the notice on Wednesday. Perhaps you can see the gentlemen referred to to-night and remove their objections. I am, very truly, your obedient servant,

"John A. Dix."

On the 8th of February, 1861, a bill became a law providing for the sale of $20,000,000 six per cent. bonds, and these were sold at the rate of $89.10 for $100, yielding $18,415,000.

Such was the humiliating financial condition of the government of the United States at the close of Mr. Buchanan's administration. The expenditures of the government for the fiscal year ending June 30, 1861, were $84,577,258.60, of which $42,064,082.95 was procured from loans and treasury notes, leaving a balance in the treasury, at the close of the fiscal year 1861, of $2,395,635.21. This condition still existed when Congress subsequently met in special session.

Under the sub-treasury laws then in force, the revenues of the government were received and held only in the treasury at Washington, and in sub-treasuries located in a few of the principal cities of the United States, and could be paid out only upon the draft of the treasurer of the United States, drawn agreeably to appropriations made by law. No money could be received into the treasury except gold and silver coin of the United States, and such treasury notes as were receivable for bonds. State bank notes were not received for government dues. This exclusion grew out of the general failure of banks after the War of 1812 and the panic of 1837, and had caused the outcry in 1840 of: "Gold for the office holders; rags for the people." But this policy of the government to receive only its own coin or notes was sustained by popular opinion.

Silver dollars were not in circulation in 1861. Their issue was provided for at the beginning of our government, but, as they were most of the time more valuable than gold coin of like face value, they were hoarded or exported. Their coinage was suspended by an order of President Jefferson in 1805, and after this order only 1,300 silver dollars were coined by the United States prior to 1836. From 1836 to 1861 silver dollars were coined in small quantities, the aggregate being less than one and one-half million, and they were generally exported. It is probable that when Mr. Chase became Secretary of the Treasury, there was not in the United States one thousand silver dollars. In 1853, and prior to that year, fractional silver coins were worth for bullion more than their face value, and, therefore, did not circulate. Small change was scarce, and fractional notes, called "shinplasters," were issued in many parts of the United States. Mexican coin, debased and worn, was in circulation. To remedy this evil Congress, by the act of February 21, 1853, during Pierce's administration, prescribed the weight of the silver half dollar as 192 grains instead of 206¼ grains, fixed by the coinage act of 1792, and the weight of the quarter, dime and half dime of silver was reduced in the same proportion. As these new coins were less valuable than gold at the rate coined, they were made a legal tender in payment of debts only for sums not exceeding five dollars. The silver bullion for these coins was purchased at market value, and the privilege theretofore granted to a depositor of silver bullion to have it coined for him was repealed. This law had the beneficial effect of driving out of circulation "shinplasters" and worn coins, and supplied in ample quantity new full weight silver coins of handsome device, the government receiving the profit of the difference between the market value of the silver and its coinage value. Under this law the coinage of silver rapidly increased, so that, within two years after the passage of the act of 1853, more silver was converted into fractional coins and was in active use among the people than was contained in all the silver dollars coined under "free coinage" from the beginning of the government to 1878.

While silver was thus made useful to the fullest extent possible, it was, from its weight and bulk, inadequate and inconvenient for the vast demands of the government during the war. Silver and gold together could not meet this demand. There was known to be in the country at that time, of specie in circulation, $250,000,000, of state bank notes, $180,000,000, in all $430,000,000. This amount, experience had shown, was necessary to meet exchanges in ordinary times of peace. The disturbance of a civil war would likely stimulate production for a time and require even more circulation for current business. This circulation, if drawn from its ordinary channels, would bring no end of confusion and distress to the people, and the government, to meet the demand occasioned by carrying on a war, must look elsewhere for a circulating medium with which to meet its enormous disbursements which must necessarily be made almost wholly in actual cash--checks being, from the character of payments, of little avail.

There was no escaping the issue of credit money in some form, and of whatever form adopted we knew that gold and silver would soon disappear under the shadow of war--that they would be hoarded or exported.

This is the universal result of great wars long protracted. It was our experience during our Revolution and the War of 1812, and of Great Britain and all European nations during the Napoleonic wars. What should take the place of gold and silver for currency? The only answer was to substitute for the time the notes of the United States, with all the sanction and credit which the republic could confer, in the place of coin. We could not, with safety, accept bank notes issued by state corporations, varying in terms and credit according to the laws of twenty-three separate states.

To establish a credit of our bonds and notes these measures at least were necessary: First, to increase largely the revenues from customs duties to be paid in coin; second, impose all forms of internal taxes authorized by the constitution; third, create a national currency redeemable in coin, with no fixed time for redemption, but made a legal tender for all debts, public and private, except customs duties; fourth, borrow any moneys needed on the most favorable terms possible.

On the 4th of July, 1861, the Senate convened in compliance with the proclamation of the President, from whom it received a message containing a clear statement of the events that followed his inaugural address. He described the attack upon Fort Sumter and said:

"By the affair at Fort Sumter, with its surrounding circumstances, that point was reached. Then and thereby the assailants of the government began the conflict of arms, without a gun in sight or in expectancy to return their fire, save only the few in the fort, sent to that harbor years before for their own protection, and still ready to give that protection in whatever was lawful. In this act, discarding all else, they have forced upon the country the distinct issue, 'immediate dissolution or blood.'

"And this issue embraces more than the fate of these United States. It presents to the whole family of man the question, whether a constitutional republic, or democracy--a government of the people by the same people--can or cannot maintain its territorial integrity against its own domestic foes. It presents the question, whether discontented individuals, too few in number to control administration according to organic law in any case, can always, upon the pretenses made in this case, or on any other pretenses, or arbitrarily, without any pretense, break up their government, and thus practically put an end to free government upon the earth. It forces us to ask: 'Is there, in all republics, this inherent and fatal weakness?' 'Must a government, of necessity, be too strong for the liberties of its own people, or too weak to maintain its own existence?'

"So viewing the issue, no choice was left but to call out the war power of the government; and so to resist force employed for its destruction, by force for its preservation."

He closed with this appeal to the people:

"It was with the deepest regret that the Executive found the duty of employing the war power in defense of the government forced upon him. He could but perform this duty, or surrender the existence of the government. No compromise by public servants could in this case be a cure; not that compromises are not often proper, but that no popular government can long survive a marked precedent that those who carry an election can only save the government from immediate destruction by giving up the main point upon which the people gave the election. The people themselves, and not their servants, can safely reverse their own deliberate decisions.

"As a private citizen, the Executive could not have consented that those institutions should perish; much less could he, in betrayal of so vast and so sacred a trust as these free people have confided to him. He felt that he had no moral right to shrink, or even to count the chances of his own life, in what might follow. In full view of his great responsibility, he has, so far, done what he has deemed his duty. You will now, according to your own judgment, perform yours. He sincerely hopes that your views and your action may so accord with him as to assure all faithful citizens who have been disturbed in their rights of a certain and speedy restoration of them, under the constitution and the laws.

"And having thus chosen our course, without guile and with pure purpose, let us renew our trust in God, and go forward without fear and with manly hearts."

Secretary Chase also submitted to Congress, on the first day of the session, a clear statement of the financial condition of the United States. He estimated the sum needed for the fiscal year ending June 30, 1862, at $318,519,581. He recommended a large increase of duties on imports, especially upon such articles as were then free from duty; also a direct tax of $20,000,000, to be apportioned among the states according to population; also a tax on distilled spirits, ale, beer, tobacco, bank notes, and other articles of domestic production. He also suggested the property of those engaged in insurrection or in giving aid and comfort to insurgents should be made to contribute to the expenditures made necessary by their criminal misconduct. As the receipts from taxation would still be inadequate to meet the expenses of the war, he discussed the best mode and form of borrowing money, including bonds running for a long period with a fixed rate of interest, and treasury notes bearing interest, payable on demand.

Kansas having recently been admitted into the Union, twenty-three states were represented in the Senate by forty-six Senators. Eleven states being in open war against the United States, twenty-one of their Senators withdrew, but Andrew Johnson, of Tennessee, remained in the Senate, making the total of Senators forty-seven. Some of these Senators were new in congressional life, and some had been transferred from the House of Representatives. This transfer of a Member, though eagerly sought, is not for a time agreeable. However conspicuous the Member may have been in the House, he must take his place in the Senate at the bottom of the ladder, and, according to Senatorial usage, must be reasonably modest in expressing his opinions. The withdrawal of so many Senators in 1861, however, gave the new Members better positions than usual. I was assigned to the committee on finance and on naval affairs.

At that time the committee on finance had charge of all bills appropriating money for the support of the government, all tax or revenue bills, all loan and coinage bills, and, generally, all bills relating to the treasury department, and to the finances of the government. It was soon manifest that, in view of the war, and the enormous sums required to conduct it, the task of the committee would be a Herculean one, and that the labor required would fall chiefly on Mr. Fessenden, the chairman of the committee, and, I may with due modesty add, myself. My former position in the House of Representatives, as chairman of the committee of ways and means, and my personal association with Secretary Chase, with whom I was intimate, led to my taking an active part in financial legislation, which was considered my specialty. Congress, in substantial conformity with the recommendations of Secretary Chase, passed the act to authorize a loan which was approved July 17, 1861, providing for the issue of $250,000,000 of bonds running twenty years, bearing not exceeding seven per cent. interest, or treasury notes for not less than fifty dollars each, bearing interest at not less than seven and three-tenths per cent. annually, and payable in three years, and treasury notes of less denomination than fifty dollars, not bearing interest and not exceeding $50,000,000, payable on demand, and commonly known as demand notes. We knew that this act was entirely inadequate for the great struggle before us. The problem was not whether we could muster men, but whether we could raise money. We had to create a system of finance that would secure an enlarged revenue, unquestioned credit, absolute certainty of payment of interest in coin, a national currency, and such economy as is possible during war.

The first feeble attempt to create a national currency was the issue of demand notes under the act of July 17, 1861, described as follows:

"And the Secretary of the Treasury may also issue, in exchange for coin, and as part of the above loan, or may pay for salaries or other dues from the United States, treasury notes of a less denomination then fifty dollars, not bearing interest, but payable on demand by the assistant treasurer of the United States, at Philadelphia, New York or Boston."

The fatal defect of these notes was the promise to pay on demand. How could they be paid? In what kind of money? They could not be paid out of the current revenue, for that was insufficient to meet current expenses. No reserve was provided for their payment, and, when paid, there was no authority for their re-issue. All other forms of securities bore interest, and these notes, not bearing interest, were convertible into bonds and that was the end of them. If that was the process why issue them at all? They did not prevent, but rather expedited, the disappearance of gold. Of American silver dollars there were none. Even the new fractional silver coins rose to a premium, and were hoarded or exported. Still, the necessity existed for some form of paper money that would be available for circulation. The solution of this problem was properly left to the next regular session of Congress.

Congress did not act upon the recommendations for internal taxes, but this subject was also left over until the next session. It did provide, however, for a large increase of revenue from imports, mainly upon articles that were then free from taxation and upon articles regarded as luxuries; also for a direct tax on the states of $20,000,000, and for a graded tax, from and after the first day of January, 1862, upon the annual income of every person residing in the United States, from whatever source the income should be derived; if such annual income should exceed the sum of $800 a tax of three per cent. on the excess above that limit. A provision was made reducing the tax on incomes from treasury notes and other securities of the United States one-half. The tax on incomes of citizens of the United States residing abroad was placed at five per cent., except on that portion derived from interest on treasury notes and other securities of the United States, which was taxed one and one-half per cent.

While Congress was engaged in legislative duties in Washington, the military forces of the Confederate States were gathering in Virginia, with the principal force at Manassas, about twenty-five miles southwest of Washington, under the command of General Beauregard. The Union troops, composed mainly of three months' volunteers, were in camp occupying the region about Washington on both banks of the Potomac River, under the immediate command of General McDowell, but with Lieutenant General Scott in full command. I frequently visited the Union camps where the soldiers, fresh from civil life and confident of easy success over the "rebels," were being drilled. The cry was, "On to Richmond!" They could not foresee the magnitude of the task they had undertaken. I will not attempt to narrate the incidents of the Battle of Bull Run. I knew it was to be fought on Sunday, the 21st of July. Soon after noon of that day I mounted my horse, and with James Rollins, a Member of Congress from Missouri, called on General Scott, and inquired for news of the battle then going on. He told us he was quite sure of a favorable result, but feared the loss of his gallant officers as, the troops being raw, it would be necessary for their officers to lead them. We crossed the pontoon bridge from Georgetown, and then, passing by Arlington, we went to a new fort on the main road from the Long Bridge. As we approached we could hear the distant firing of cannon. We asked a sentinel on duty if he had heard the sound all day. He said, "Yes, but not so loud as now." This was significant but not encouraging. We returned to my lodgings on Fifteenth street. Everywhere there was an uneasy feeling. At eight o'clock in the morning I started for the residence of the Secretary of War to get information of the battle. As I approached I was seized by the arm, and, turning, saw Secretary Cameron. I asked about the battle, but, without answering, he hurried me into the house and said: "Our army is defeated, and my brother is killed." He then gave way to passionate grief. His brother, Colonel Cameron, had been killed, and the Union army was in full retreat. I was enjoined to say nothing until morning. I obeyed his injunction. At eleven o'clock that night I heard the clatter of a horse's feet in full gallop. My nephew, Robert McComb, a boy about nineteen, a private soldier in an Ohio regiment, but detailed as an orderly, had been sent to the rear with a message. He saw the army in retreat, and, being well mounted and believing that discretion was the better part of valor, rode rapidly to my lodgings in Washington. It is uncertain whether he or "Bull-Run" Russell, an English reporter, made the best time to the Long Bridge. McComb gave me a doleful account of the battle and retreat. The official reports from both armies show that it was a drawn battle. General Sherman, in his "Memoirs," gives a graphic history of the battle and expresses the same opinion.

Still, the battle of Bull Run was an important event. It dispelled the illusion of the people of the north as to the duration and gravity of the war. It demonstrated the folly of ninety days' enlistments. It brought also, to every intelligent mind, the dangers that would inevitably result from disunion. On the 22nd of July, the day after the battle, the bill to authorize the employment of 500,000 volunteers became a law.

On the 29th of July two bills, one for the increase of the military establishment of the United States, and one to provide for the suppression of the rebellion, were passed. On the 5th of August an act passed for the better organization of the military establishment. Armed with the largest military power ever conferred upon a President, with the almost unlimited power of taxation, the administration of Mr. Lincoln entered upon the task before it.

Having passed these provisions in aid of the government, the special session of Congress closed on the 6th of August, 1861.

I immediately returned to my home at Mansfield. Regiments were being organized but it seemed to me that the mode of enlistment was too slow. The people, though still resolute, were somewhat troubled by the failure of military operations. I felt this so strongly that I determined at once to adopt some plan to raise a brigade to be composed of two regiments of infantry, one battery of artillery and one squadron of cavalry. When I made application to Governor Dennison for the requisite authority, he feared my plan might interfere with existing organizations then being enlisted in the different parts of the state, and I was persuaded to wait until after the 15th regiment was recruited and in the field, and the 42nd was well under way. I also made up my mind to delay actual recruiting until after the election in October of that year, so that no political bias might enter into it.

On the 24th of September I addressed a letter to the Hon. Simon Cameron, Secretary of War, as follows:

"Mansfield, Ohio, September 24, 1861. "Hon. Simon Cameron, Secretary of War:

"Dear Sir:--I respectfully ask for an order granting me leave to recruit and organize, in this part of Ohio, a brigade of two regiments of infantry, one squadron of cavalry, and two companies of artillery. I know I can do it promptly. The squadron of cavalry authorized to Major McLaughlin may, if desired, be considered as part of the brigade.

"For reasons that are probably unjust the governor and state military authorities are less successful than I hoped, and I know that I can get you recruits that they cannot. I wish no rank, pay, or expenses for myself, and will freely act without compensation. I care not who are the field officers, so I know they are men of honor, honesty and experience. I will only ask of the department the usual rations, pay and armament and equipage for the men; I ask nothing for myself, will undertake upon my individual responsibility to purchase any of them desired, receiving in return government securities therefor.

"I will so execute the order as not to interfere with the state authorities, and will act in subordination to them. I will freely confer with the government as to details, but would rather be left as free as practicable in the selection of officers.

"I hope, my dear sir, this application will receive your sanction, and I will stake my reputation and property that what I offer shall be accomplished.

"Very truly yours, "John Sherman."

On the same day, in order to secure the active co-operation of Secretary Chase, I wrote him as follows:

"Mansfield, Ohio, September 24, 1861. "Hon. S. P. Chase, Secretary of the Treasury:

"My Dear Sir:--I have to-day written to General Cameron, asking an order allowing me to recruit a brigade in this part of Ohio. I know I can do it. I ask no office, rank, pay, or expenses for myself, and will undertake to recruit this force in subordination to the state and general government, and within such limits as may be allowed. Whatever may be the reason, it is manifest that voluntary enlistment needs the spur of active exertion and solicitation. This I am willing to give, and, from offers freely made to me by personal acquaintances, know that I can enlist hundreds whom the state authorities cannot reach.

"Can I ask your favorable influence and co-operation? I will pay my own expenses, and ask only rations, tents and armament for the men. Any of these I am willing to purchase upon my individual credit, receiving in payment government securities. I pledge you my reputation and all I am worth to accomplish what I offer.

"If it is objected that my operation will interfere with state enlistments, I will agree to subordinate my movements to the orders of the governor, but for the good of the service I hope to be left as free as possible. In the selection of officers I should want to be especially consulted, so as to insure the honor, probity and personal habits of such officers. Further than this I have no choice.

"If this meets your approbation promptly say so to General Cameron, and let him set me to work.

"Very truly yours, "John Sherman."

About the same time I had arranged with Governor Dennison for a plan of enlistment which enabled the recruits to select their officers, by allowing persons securing a certain number of recruits to be captains, a less number first lieutenants, and a less number second lieutenants. The governor very kindly agreed that he would commission the persons selected in this way, leaving the regimental organization to be composed of the best material that could be found anywhere. On the 28th of September I issued and distributed, mainly in the region near the line of the Pittsburg, Fort Wayne & Chicago railroad, this circular:

"TO THE YOUNG MEN OF OHIO.

"I am authorized by the governor of Ohio to raise at once two regiments of infantry and a battery of artillery, and a squadron of cavalry.

"I am also authorized to recommend one lieutenant for each company, who shall at once receive their commissions and be furnished with proper facilities for enlisting. I am now ready to receive applications for such appointments, accompanied with evidence of good habits and character, the age of applicant, and his fitness and ability to recruit a company.

"Major Wm. McLaughlin will command the squadron of cavalry.

"The company officers will be designated by the soldiers of each company, subject to the approval of the governor.

"The field officers are not yet designated, but shall be men of experience, and, if possible, of military education.

"The soldiers shall have, without diminution, all they are entitled to by law.

"Danger is imminent. Promptness is indispensable. Let the people of Ohio now repay the debt which their fathers incurred to the gallant people of Kentucky for the defense of Ohio against the British and Indians. They now appeal to us for help against an invasion more unjustifiable and barbarous.

"Letters can be addressed to me, marked 'Free,' at Mansfield, Ohio.

"John Sherman. "Mansfield, Ohio, September 28, 1861."

The matter thus rested until after the election on the 9th of October, when squads rapidly formed into companies, and within twenty days Camp Buckingham was opened near Mansfield.

In the performance of this self-imposed duty, I encountered but one difficulty, and at one time a very serious one, the selection of regimental officers, and especially of commanders of regiments. I knew that military warfare was an art, a trade, an occupation, where education, experience and preparation are absolutely essential to effective service. The materials for soldiers abound everywhere, but without discipline, order, obedience, and severe drilling men are not soldiers. It was my desire to secure for the commanders of regiments two graduates of West Point. I made application direct to Washington for various details of officers of the regular army, so that the soldiers in Camp Buckingham might have experienced drill masters from the beginning. I failed to receive an answer, and went to Washington, earnestly impressed with the importance of my mission, and determined, if possible, that these men enlisted by me should not be placed in the front of the enemy until they had had all the benefit they could derive from military discipline and drilling. When I arrived I found that Secretary Cameron was indisposed to interfere with the purely military details of the army, while General Scott, a brave old soldier whom I always loved and admired, was firmly of the opinion that the favorable result of the war depended upon strengthening the regular army, maintaining its force and discipline, and especially retaining its valuable officers. The regular army, almost disbanded at the beginning of the war, was gradually filling up upon the basis of a new organization and long enlistments, but it was idle, it seemed to me, to expect that the young men of the country would enlist in the regular service. While ready to respond to the call of their country in its actual peril, they had no purpose to become regular soldiers for life. It appeared to me, therefore, that the manifest policy of the government should be to allow the regular army to be gradually absorbed into the volunteer service, where the young officers educated at the expense of the government might impart instruction to regiments and brigades, instead of to squads and companies. I spoke to General Scott about this, and the result of my interview was very unpleasant. I fear we both lost our temper, though I never ceased to respect the old general for the great service he had rendered his country; but his day was past.

After consulting Major Garesche, Assistant Adjutant-General, as to the names of officers, I then applied to the President, explained to him fully the situation of affairs, my promise, the gathering of the soldiers in Camp Buckingham, their inexperience, and want of drill masters, their ardent patriotism, stated my interview with General Scott, and appealed to him to help me out of the dilemma.

I never shall forget the interview with Mr. Lincoln, for he did not hesitate, but sent for Major Garesche, and gave me the coveted order before I left him, directing the Secretary of War to detail two second lieutenants, James William Forsyth, of Ohio, and Charles Garrison Harker, of New Jersey, and Sergeants Bradley and Sweet, of the regular army, for service in the Ohio Volunteers, under my direction. This order was the key that unlocked the difficulty and gave to the force the elements of military discipline. At the same time the requisite orders were given for uniforms, arms of the best pattern, cannon, horses and various equipments.

I then procured the detail of Major Robert S. Granger, of the United States army, to command the camp and to organize the force. He had graduated as a cadet from Ohio, was one of the officers of the regular army surrendered by General Twiggs to the State of Texas before the beginning of the war, and had given his parole not to serve in the army until exchanged. Though this was not held to apply to the enlistment of volunteers he so construed his parole as to prevent him from serving in his regiment until duly exchanged. When this was done he entered the service and was rapidly promoted to Major General of Volunteers.

Within sixty days 2,340 young men of Ohio were formed into the 64th and 65th regiments, the 6th battery of artillery, and McLaughlin's squadron of cavalry, armed with the best arms then in the service, uniformed, equipped and partly drilled as soldiers, ready to march, and actually marching, to the seat of war. No better material for soldiers, and no better soldiers in fact, ever enlisted in any cause or any service.

I insert a letter from General Garfield written when he was in command of this brigade:

"Headquarters, 20th Brigade, } "In the Field, 6 Miles from Corinth, Miss., May 17, 1862.} "Hon. John Sherman, Washington, D. C.

"Dear Sir:--I am now in command of the 20th Brigade, composed of the 64th and 65th Ohio (the regiments raised by yourself) and the 13th Michigan and 51st Indiana Regiments. I have sent forward to Washington the name of Lt. D. G. Swain (65th Ohio) of Salem, O., for appointment as A. A. Gen. on my staff. He is an excellent officer, and his nomination has been approved by Gen. Buell. I will be particularly obliged to you if you will aid in securing his appointment as soon as possible. The whole army advances toward Corinth this morning.

"Very respectfully yours, "J. A. Garfield, "Brig. Gen. Vols. U. S. A."

When General Sherman was in Louisville in October, 1861, he was called upon by Secretary Cameron, and they engaged in a general discussion of the military situation. General Sherman said that for aggressive movements, the United States would require 200,000 men. This was so far beyond the ideas of the time that he was regarded as crazy, and was soon after relieved from his command by General Buell. Secretary Cameron was blamed for this, but his letter to me, here inserted, shows that he was absent from Washington when the order was made:

"War Department, Nov. 14, 1861. "Sir:--Your letter of the 10th inst. is received. General Sherman was recalled from the command in Kentucky during my absence at the north on official business. Since my return on the 11th, I have not had time to make any inquiries concerning the cause of the change, but I feel certain it was not from any want of confidence in the patriotism or capacity of your brother. He has been ordered to Missouri, under the immediate command of Major General Halleck, of the regular army, and the fact that he has been so assigned is evidence of the confidence reposed in him.

"Very respectfully, your obedient servant, "Simon Cameron, Secretary of War."

CHAPTER XII. PASSAGE OF THE LEGAL TENDER ACT IN 1862. My Interview with Lincoln About Ohio Appointments--Governmental Expenses Now Aggregating Nearly $2,000,000 Daily--Secretary Chase's Annual Report to Congress in December, 1861--Treasury Notes a Legal Tender in Payment of Public and Private Debts--Beneficial Results from the Passage of the Bill--The War Not a Question of Men, but of Money--Proposed Organization of National Banks--Bank Bills Not Taxed--Local Banks and Their Absorption by the Government--The 1862 Issue of $150,000,000 in "Greenbacks"--Legal Tender Act a Turning Point in Our Financial History--Compensation of Officers of the Government.

About this time I had an interview with Mr. Lincoln which may be of interest. In making the local appointments in Ohio he was naturally governed largely by his strong affinities for old Whig associates in Congress, of one of whom, General Schenck, he was especially fond. I thought some of his appointments in Ohio were not judicious, and concluded I would go to him and make a general complaint of the distribution of these offices. I felt that he failed to consider the fact that the Republican party contained many men who had not belonged to the Whig party. I requested an interview with him which was promptly granted, and called at his office one evening. He was seated in an easy chair and seemed to be in excellent humor. I proceeded to complain of some of his appointments in Ohio and as I progressed the expression of his face gradually changed to one of extreme sadness. He did not say a word, but sank in his chair, placing his feet upon the table, and looking, as I thought, the picture of despair. I proceeded with my complaint until I began mentally to reproach myself for bothering the President of the United States with so unimportant a matter as the choice of persons to fill local offices in Ohio, when the country was in the throes of revolution. Finally I told him I felt ashamed to disturb him with such matters and would not bother him again with them. His face brightened, he sat up in his chair and his whole manner changed, until finally he almost embraced me. He then told me many interesting stories of his short service in Congress and of the men with whom he was brought in contact. The close of the interview was very pleasant and I kept my promise to him about his appointments.

When Congress convened on the 2nd of December, 1861, the financial condition of the government was more alarming than at any other period during the war.

The Secretary of the Treasury had ample and complete authority, given him by the act of July, 1861, to borrow money on the credit of the government, but he could not deal with the system of state banks then existing in the several states. He was forbidden, by the sub-treasury act of 1846, to receive notes of state banks and was required to receive into and pay from the treasury only the coin of the United States; but by the act of August 5, 1861, he was permitted to deposit to the credit of the Treasurer of the United States, in such solvent specie-paying banks, as he might select, any of the moneys obtained from loans, the moneys thus deposited to be withdrawn only for transfer to the regularly authorized depositaries, or for the payment of public dues, including certain notes payable on demand, as he might deem expedient. He had, however, no authority to receive from individuals or banks any money but coin.

The coin received from the Boston, New York, and Philadelphia banks, in payment of their subscriptions to the government loans, to the amount of nearly $150,000,000, had to be sent to every point in the United States to meet public obligations, and, when thus scattered, was not readily returned to the banks, thus exhausting their resources and their ability to loan again.

The demand notes, authorized by the act of July 17, 1861, were also paid out by the treasury; but from time to time were presented for redemption in coin or in payment of customs duties to the exclusion of coin, and thus both the banks and the government were greatly crippled, the banks suspending specie payments on the 30th day of December, 1861.

At this time an army of 500,000 Union soldiers was in the field, and a powerful navy, with vast stores of artillery and ammunition, had been created. In providing for their sustenance, comfort and equipment the government had been obliged to incur expenses far exceeding in magnitude any which had been hitherto known in its history, aggregating nearly $2,000,000 per day.

It was apparent that a radical change in existing laws relating to our currency must be made, or the government would practically be unable to make the current disbursements on account of the war, and the destruction of the Union would be unavoidable, notwithstanding the immense resources of the country which had then hardly been touched.

The annual report of Secretary Chase reached Congress on the 10th of December, having been delayed by the press of business. So much of it as related to the currency was the basis of the long debates that followed. The circulation of the banks of the United States on the 1st of January, 1861, was reported at $202,000,767. Of this $152,000,000, in round numbers, was in the loyal states, including West Virginia, and $50,000,000 in the rebel states, the whole constituting a loan without interest from the people to the banks, costing the latter only the expense of issue and redemption and the interest on the specie kept in hand for the latter purpose. The secretary called especial attention to the organization and nature of these banks, and questioned whether a currency of banks issued by local institutions under state laws was not in fact prohibited by the national constitution. He said:

"Such emissions certainly fall within the spirit, if not within the letter, of the constitutional prohibition of the emission of 'bills of credit' by the states, and of the making by them of anything except gold and silver coin a legal tender in payment of debts. However this may be, it is too clear to be reasonably disputed that Congress, under its constitutional powers to lay taxes, to regulate commerce, and to regulate the value of coin, possesses ample authority to control the credit circulation which enters so largely into the transaction of commerce, and affects in so many ways the value of coin. In the judgment of the secretary, the time has arrived when Congress should exercise this authority."

He described with great force the weakness of the state banking system, and the repeated losses by the people of the United States on account of the failure of such banks. He recommended two plans by either of which he held that these banks might be absorbed, and a national currency be substituted in the place of their issues. One plan proposed the gradual withdrawal from circulation of the notes of private corporations, and the issue in their stead of United States notes, payable in coin on demand, in amounts sufficient for the useful ends of a representative currency. The other proposed a system of national banks authorized to issue notes for circulation under national direction, to be secured as to prompt convertibility into coin by the pledge of United States bonds and other needful regulations. He discussed these two plans at length, but concluded by recommending a system of national banks, the advantages of which would be uniformity in currency, uniformity in security, an effectual safeguard against depreciation, and protection from losses from discounts and exchanges. He expressed the opinion that such notes would give to the government the further advantage of a large demand for government securities, of increased facilities for obtaining the loans required for the war, a reduction of interest, and a participation by the government in the profit of circulation without risking the perils of a great money monopoly. It will be noticed that the secretary nowhere suggested the suspension of coin payments, or making the notes a legal tender in payment of public and private debts, or the redemption in coin of the bank notes to be issued.

These recommendations were referred to the committee of ways and means of the House, and by it to a sub-committee, of which Elbridge G. Spaulding, of New York, was chairman. Undoubtedly we owe to him, more than to any other individual Member, the important and radical changes made in our currency system by the act reported by him to the House and amended in the Senate. Mr. Spaulding perceived the objection to the recommendations of Secretary Chase that they did not provide for any payments but in coin, or call for a suitable provision that the notes when issued should be a legal tender for public and private debts, or for their reissue in case of payment, nor did they provide for the absorption of the demand notes outstanding, which were, on their face, payable on demand, an obligation that could not be ignored without severely impairing the public credit. It was also apparent that the system of national banks proposed by the secretary could not be organized and put in effective force for a year or more, and that in the meantime the state banks would be in a condition of suspension, without coin or the possibility of obtaining it, and, with no effective money which the people were bound to receive, or which the government could receive, it would have been difficult to carry on the operations of the war.

The first bill introduced by Mr. Spaulding, on the 30th of December, met some of these difficulties. It provided for the issue of $50,000,000 treasury notes, payable on demand, the notes to be receivable for all debts and demands due to or by the United States, to be a legal tender in payment of all debts, public or private, within the United States, and exchangeable at their face value, the same as coin, at the treasury of the United States, and the offices of the assistant treasurers in New York, Boston, Philadelphia, St. Louis and Cincinnati, for any of the coupon or registered bonds which the secretary was authorized to issue. It also contained this provision: "Such treasury notes may be reissued from time to time as the exigencies of the public service may require," the first authority ever given for the reissue of treasury notes after redemption.

On the 7th of January, 1862, Mr. Spaulding reported the bill to the House with some important changes, and it soon became the subject of a long and interesting debate. On the 22nd of January, Secretary Chase returned Mr. Spaulding's bill to him and suggested some modifications, referring to the legal tender clause as follows, being his first reference to that clause:

"Regretting exceedingly that it is found necessary to resort to the measure of making fundable notes of the United States a legal tender, but heartily desiring to co-operate with the committee in all measures to meet existing necessities in the most useful and least hurtful to the general interest, I remain," etc.

In a letter to the committee of ways and means, on the 29th of January, the secretary said:

"The condition of the treasury certainly needs immediate action on the subject of affording provision for the expenditures of the government, both expedient and necessary. The general provisions of the bill submitted to me seem to me well adapted to the end proposed. There are, however, some points which may, perhaps, be usefully amended.

"The provision making United States notes a legal tender has doubtless been well considered by the committee, and their conclusion needs no support from any observation of mine. I think it my duty, however, to say, that in respect to this provision my reflections have conducted me to the same conclusion they have reached. It is not unknown to them that I have felt, nor do I wish to conceal that I now feel, a great aversion to making anything but coin a legal tender in payment of debts. I has been my anxious wish to avoid the necessity of such legislation. It is, however, at present impossible, in consequence of the large expenditures entailed by the war, and the suspension of the banks, to procure sufficient coin for disbursements; and it has, therefore, become indispensably necessary that we should resort to the issue of United States notes. . . . Such discrimination should, if possible, be prevented; and the provision making the notes legal tender, in a great measure at least, prevents it, by putting all citizens, in this respect, on the same level, both of rights and duties."

On the 3rd of February the secretary wrote to Mr. Spaulding as follows:

"Mr. Seward said to me on yesterday that you observed to him that my hesitation in coming up to the legal tender proposition embarrassed you, and I am very sorry to observe it, for my anxious wish is to support you in all respects.

"It is true that I came with reluctance to the conclusion that the legal tender clause is a necessity, but I came to it decidedly, and I support it earnestly. I do not hesitate when I have made up my mind, however much regret I may feel over the necessity of the conclusion to which I come."

On the 5th of February the secretary became more urgent, and wrote to Mr. Spaulding the following brief note:

"My Dear Sir:--I make the above extract from a letter received from the collector of New York this morning. It is very important the bill should go through to-day, and through the Senate this week. The public exigencies do not admit of delay.

"Yours truly, "S. P. Chase. "Hon. E. G. Spaulding."

It will thus be perceived that, whatever may have been the constitutional scruples of Secretary Chase in respect to the legal tender clause, he yielded to it under the pressure of necessity, and expressed no dissent from it until, as chief justice, his opinion was delivered in the case of Hepburn vs. Griswold, in the Supreme Court of the United States.

The bill, much modified from the original, passed the House of Representatives by the decided vote of yeas 93, nays 59. As it passed the House it contained authority to issue, on the credit of the United States, United States notes to the amount of $150,000,000, not bearing interest, payable to bearer at the treasury of the United States, at Washington or New York. It provided that $50,000,000 of said notes should be in lieu of the demand treasury notes authorized by the act of July 17, 1861, and that said demand notes should be taken up as rapidly as practicable. It provided that the treasury notes should be receivable in payment of all taxes, duties, imports, excise, debts and demands of all kinds due to the United States, and all debts and demands owing by the United States to individuals, corporations and associations within the United States, and should be lawful money and a legal tender, in payment of all debts, public and private, within the United States.

This bill came to the Senate on the 7th of February. It was followed on the same day by a letter from Secretary Chase to Mr. Fessenden, as follows:

"Sir:--The condition of the treasury requires immediate legislative provision. What you said this morning leads me to think that the bill which passed the House yesterday will hardly be acted upon by the Senate this week. Until that bill shall receive the final action of Congress, it seems advisable to extend the provisions of the former acts, so as to allow the issue of at least $10,000,000 in United States notes, in addition to the $50,000,000 heretofore authorized. I transmit a bill framed with that object, which will, I trust, meet your approval and that of Congress. Immediate action on it is exceedingly desirable."

The request for authority to issue $10,000,000 additional demand notes was immediately granted, and the bill was passed without opposition.

The currency bill was considered in the committee on finance of the Senate, and four important and radical amendments were reported by that committee. These amendments were as follows:

First--That the legal tender notes should be receivable for all claims and demands against the United States, of every kind whatsoever, "except for interest on bonds and notes, which shall be paid in coin."

Second--That the secretary might dispose of United States bonds, "at the market value thereof, for coin or treasury notes."

Third--A new section authorizing deposits in the sub-treasuries at five per cent., for not less than thirty days, to the amount of $25,000,0000, for which certificates of deposit might be issued.

Fourth--An additional section, No. 5, "that all duties on imported goods and proceeds of the sale of public lands," etc., should be set apart to pay coin interest on the debt of the United States; and one per cent. for a sinking fund, etc.

It was felt that if no provision was made for the payment of the interest on the bonds in coin, they would depreciate more and more, while such payment would tend, as it did, to maintain them nearer to their specie standard. In order to obtain coin for the payment of interest, provision was made that all duties on imported goods, and the proceeds of the sale of public lands, should be payable in coin and be set apart to pay coin interest on the debt of the United States, and one per cent. for a sinking fund to provide for ultimate redemption of the bonds. These amendments were considered of prime importance. It was felt that the duty on imported goods should not be lessened by any depreciation of our local currency. Such importations were based upon coin values, and the tax levied upon them was properly required to be paid in coin. This security of coin payment enabled the government to sell bonds at a far higher rate than they would have commanded without it, and tended also to limit the depreciation of United States notes. The bill and amendments were reported on the 12th, and became the subject of what was regarded as a very able debate.

There was decided opposition in the Senate to the legal tender clause, headed by Mr. Fessenden. Mr. Collamer, who also was opposed to it, made a motion to strike it out. Upon that subject I made my first lengthy speech in the Senate, a few extracts from which I insert:

"The motion of the Senator from Vermont now for the first time presents to the Senate the only question upon which the members of the committee of finance had any material difference of opinion, and that is, whether the notes provided for in this bill shall be made a legal tender in payment of public and private debts. Upon this point I will commence the argument where the Senator from Maine left it.

"In the first place, I will say, every organ of financial opinion --if that is a correct expression--in this country agrees that there is such a necessity, in case we authorize the issue of demand notes. You commence with the Secretary of the Treasury, who has given this subject the most ample consideration. He declares, not only in his official communications here, but in his private intercourses with the members of the committee, that this clause is indispensably necessary to the security and negotiability of these demand notes. We all know from his antecedents, from his peculiar opinions, that he would probably be the last man among the leading politicians of our country to yield to the necessity of substituting paper money for coin. He has examined this question in all its length and breadth. He is in a position where he feels the necessity. He is a statesman of admitted ability, and distinguished in his high opinion. He informs us that, without this clause, to attempt to circulate as money the proposed amount of demand notes of the United States, will prove a fatal experiment.

"In addition to his opinion, we have the concurring opinion of the Chamber of Commerce of the city of New York. With almost entire unanimity they have passed a resolution on the subject, after full debate and consideration. That resolution has been read by your secretary. You have also the opinion of the committee of public safety of the city of New York, composed of distinguished gentlemen, nearly all of whom are good financiers, who agree fully in the same opinion. I may say the same in regard to the Chambers of Commerce of the city of Boston, of the city of Philadelphia, and of almost every recognized organ of financial opinion in this country. They have said to us, in the most solemn form, that this measure was indispensably necessary to maintain the credit of the government, and to keep these notes anywhere near par. In addition, we have the deliberate judgment and vote of the House of Representatives. After a full debate, in which the constitutionality, expediency and necessity of this measure were discussed, in which all the objections that have been made here, and many more, were urged, the House of Representatives, by a large vote, declared that it was necessary to issue United States notes, and that this clause was indispensable to their negotiation and credit. . . .

"A hard necessity presses the government. $100,000,000 is now due the army, and $250,000,000 more up to July first. The banks of New York, Boston and Philadelphia, have exhausted their capitals in making loans to the government. They have already tied up their capital in your bonds. Among others, Mr. Vail, the cashier of the Bank of Commerce, the largest bank corporation in the United States, and one that has done much to sustain the government, appeared before the finance committee, and stated explicitly that the Bank of Commerce, as well as other banks of New York, could aid the government no further, unless your proposed currency was stamped by, and invested with, the attributes of lawful money, which they could pay to others as well as receive themselves.

"Bonds cannot be sold except at a great sacrifice, because there is no money to buy them. As soon as the banks suspended, gold and silver ceased to circulate as money. You cannot sell your bonds for gold and silver, which is the only money that can now be received under the sub-treasury law. This currency made a legal tender was necessary to aid in making further loans. I insisted that the bill was constitutional. The Senator from Vermont has read extracts from the debates in the national convention, and from Story's 'Commentaries,' tending to show that Congress cannot authorize the issue of bills of credit. But I submit to him that this question has been settled by the practice of the government. We issued such bills during the War of 1812, during the war with Mexico, and at the recent session of Congress. We receive them now for our services; we pay them to our soldiers and our creditors. These notes are payable to bearer; they pass from hand to hand as currency; they bear no interest. If the argument of the Senator is true, then all these notes are unauthorized. The Senator admits that when we owe a debt and cannot pay it, we can issue a note. But where does he find the power to issue a note in the constitution? Where does he find the power to prescribe the terms of the note, to make it transferable, receivable for public dues? He draws all these powers as incidents to the power to borrow money. According to his argument, when we pay a soldier a ten dollar demand bill, we borrow ten dollars from the soldier; when I apply to the secretary of the Senate for a month's pay, I loan the United States $250. This certainly is not the view we take of it when we receive the money. On the other hand, we recognize the fact that the government cannot pay us in gold. We receive notes as money. The government ought to give, and has the power to give, to that money, all the sanction, authority, value, necessary and proper, to enable it to borrow money. The power to fix the standard of money, to regulate the medium of exchanges, must necessarily go with, and be incident to, the power to regulate commerce, to borrow money, to coin money, to maintain armies and navies. All these high powers are expressly prohibited to the states and also the incidental power to emit bills of credit, and to make anything but gold and silver a legal tender. But Congress is expressly invested with all these high powers, and, to remove all doubt, is expressly authorized to use all necessary and proper means to carry these powers into effect.

"If you strike out the legal tender clause you do so with the knowledge that these notes will fall dead upon the money market of the world. When you issue demand notes, and announce to the world your purpose not to pay any more gold and silver, you then tender to those who have furnished you provisions and services this paper money. What can they do? They cannot pay their debts with it; they cannot support their families with it, without a depreciation. The whole then depends on the promise of the government to pay at some time not fixed on the note. Justice to our creditors demands that it should be a legal tender; it will then circulate all over the country, and it will be the lifeblood of the whole business of the country, and it will enable capitalists to buy your bonds. The only objection to the measure is that too much may be issued. He did not believe the issue of $150,000,000 would do any harm. It is only a mere temporary expedient. . . .

"I have thus, Mr. president, endeavored to reply to the constitutional argument of the Senator from Vermont. Our arguments must be submitted finally to the arbitration of the courts of the United States. When I feel so strongly the necessity of this measure, I am constrained to assume the power, and refer our authority to exercise it to the courts. I have shown, in reply to the argument of the Senator from Maine, that we must no longer hesitate as to the necessity of this measure. That necessity does exist, and now presses upon us. I rest my vote upon the proposition that this is a necessary and proper measure to furnish a currency--a medium of exchange--to enable the government to borrow money, to maintain an army and support a navy. Believing this, I find ample authority to authorize my vote. We have been taught by recent fearful experience that delay and doubt in this time of revolutionary activity are stagnation and death. I have sworn to raise and support your armies; to provide for and maintain your navy; to borrow money; to uphold your government against all enemies, at home and abroad. That oath is sacred. As a Member of this body, I am armed with high powers for a holy purpose, and I am authorized --nay, required--to vote for all laws necessary and proper for executing these high powers, and to accomplish that purpose. This is not the time when I would limit these powers. Rather than yield to revolutionary force, I would use revolutionary force. Here it is not necessary, for the framers of the constitution did not assume to foresee all the means that might be necessary to maintain the delegated powers of the national government. Regarding this great measure as a necessary and proper one, and within our power to enact, I see plain before me the path of duty, and one that is easy to tread."

The motion to strike out the legal tender clause in the bill was defeated by a vote of yeas 17, nays 22. The amendments proposed by the finance committee were agreed to substantially as reported by the committee. The bill finally passed by a vote of yeas 30, nays 7. The House agreed to the amendment providing for the payment of the interest on bonds and notes in coin, and disagreed to the remaining amendments, and these were referred to a committee of conference, composed of Messrs. Fessenden, Sherman and Carlisle, of West Virginia, of the Senate and Messrs. Stevens, Horton, and Sedgwick, of the House. The conference met, and, after two or three days of full discussion, the material parts of the disagreements between the two Houses were settled. The provision that coin only be received for duties on imports, and that it be held as a fund to pay the interest on the bonded debt, was retained. The report of the conference was agreed to by both Houses, and on the same day the bill was approved by the President. Thus, the legal tender act, after a most able and determined opposition, became a law on the 25th of February, 1862.

It would be difficult to measure the beneficial results that rapidly followed the passage of this bill. The public credit was greatly strengthened by the provision for the payment of interest in coin furnished by duties on imported goods. The legal tender clause was acquiesced in by all classes, and we had, for the first time, in circulation national paper money as the actual standard of value. It was silent as to time of its payment, but each note contained a promise of the United States to pay a specific sum, and the implied obligation was to pay in coin as soon as practicable.

On the 11th of July, 1862, a further issue of $150,000,000 United States treasury notes (or "greenbacks," as they were commonly called from their color) of the same description was authorized, and subsequent issues increased the total amount to $450,000,000, the extreme limit. By the act of March 31, 1863, fractional currency was authorized to an amount not exceeding $50,000,000, to take the place of fractional silver coins, which had entirely disappeared from circulation, and this amount was issued.

The passage of the legal tender act was the turning point of our physical and financial history. Less than a year before the government was bankrupt; our bonds bearing six per cent. interest were sold at a discount; our national expenditures exceeded our receipts; loans could only be made upon the basis of coin, and this coin was disappearing from circulation. We had to appeal to the patriotism of bankers to accept the demand notes of the United States as money, with no prospect of being able to pay them. Our regular army was practically disbanded by the disloyalty of many of its leading officers. Washington was then practically in a state of siege, forcing me, in May, 1861, to go there at the heels of the 7th regiment of New York militia, avoiding the regular channels of travel. The city of Baltimore was decked under the flag of rebellion. Through the State of Maryland, loyal citizens passed in disguise, except by a single route opened and defended by military power. The great State of Kentucky, important as well from its central position as from the known prowess and courage of its people, hung suspended in doubt between loyalty and secession. In the State of Missouri, St. Louis was the only place of unquestioned loyalty, and even there we regarded it a fortunate prize that we were able to take the public arms from a government arsenal. The whole State of Virginia, with the single exception of Fortress Monroe, was in the possession of the revolutionary force.

But from the passage of the legal tender act, by which means were provided for utilizing the wealth of the country in the suppression of the rebellion, the tide of war turned in our favor. Delaware, after a short hesitation, complied with the proclamation of the President. Maryland had, by clear and repeated votes and acts, arrayed herself on the side of the Union. Her rebellious sons who fought against the old flag could not tread in safety on a single foot of the soil of that state. Western Virginia, the eastern peninsula, and many ports on the eastern coast, were securely reclaimed. The State of Kentucky had distinctly, by the vote of her people, and by the action of all her constituted authorities, proclaimed her loyalty, and her sons were fighting side by side with the soldiers of other states to expel traitors who, in her days of doubt, had seized upon a small portion of her soil, which they still occupied. In the State of Missouri the constituted authorities, organized by a convention of the people duly elected, were sustained by physical power in nearly all the state, and the rebellion there was subsiding into bands of thieves, bridge burners, and small parties of guerillas, who could soon be readily controlled by local militia. In nearly every rebellious state, the government had secured a foothold, and an army of half a million men, armed, organized and disciplined, impatiently awaited the word of command to advance the old banner of our country against every foe that stood in its way. Where does the history of nations present an example of greater physical weakness followed so soon by greater physical strength? When have results more wonderful been accomplished in eight months?

At the beginning of the year 1862 we were physically strong but financially weak. Therefore, I repeat, the problem of this contest was not as to whether we could muster men, but whether we could raise money. There was great wealth in the country but how could it be promptly utilized? To that question the diligent attention of Congress was applied. The banks which had aided us with money were crippled and had suspended coin payments. The Secretary of the Treasury was begging at the doors of both Houses for means to meet the most pressing demands. On the 15th of January, 1862, the London "Post," the organ of Lord Palmerston, said:

"The monetary intelligence from America is of the most important kind. National bankruptcy is not an agreeable prospect, but it is the only one presented by the existing state of American finance. What a strange tale does not the history of the United States for the past twelve months unfold? What a striking moral does it not point? Never before was the world dazzled by a career of more reckless extravagance. Never before did a flourishing and prosperous state make such gigantic strides towards effecting its own ruin."

The legal tender act, with its provision for coin receipts to pay interest on bonds, whatever may be said to the contrary by theorists, was the only measure that could have enabled the government to carry on successfully the vast operations of the war. Our annual expenditures at that time were four times the amount of our currency; were three times the aggregate coin of the country; were greater than any ever borne by any nation in ancient or in modern times. The highest expenditure of Great Britain during her war with Napoleon, at a time when her currency was inflated, when she made the Bank of England notes a legal tender, was but £100,000,000.

Anticipating these enormous expenditures I introduced a bill which became a law on the 31st of July, 1861, which provided for a commission to examine and report as to the compensation of all offices for the government, the commission to be composed of two Members of the Senate, three Members of the House of Representatives, one officer of the navy, and one officer of the army, who were directed to examine and report, as soon as practicable, a fair and just compensation for each officer of the government, and such regulations as would secure a more economical collection of the revenue. When this bill was pending I stated its purpose and my hope to accomplish a reduction of the expenditures of the government, or, at least, an equalization of the salaries then paid to the different officers. We sought economy by the reduction of expenses. I was chairman of this commission, and Senator Clark, of New Hampshire, was my associate. The commission collected a mass of information, and upon it based several bills introduced in the second session of the 37th Congress. Some of these were made nugatory by the rise of prices, measured in most cases by the fall in value of our currency, but many of their provisions were ingrafted into other bills that became laws.

The organization of national banks, authorized to issue circulating notes, is so intimately connected with legal tender United States notes that I think it proper to consider them in connection, though the banking law did not pass until 1863. The two forms of currency, one issued directly by the government as lawful money of the United States and a legal tender, and the other issued by private corporations, but secured by bonds of the United States, constitute a system of national currency which, organized in the midst of war, was an important aid to the government in its great struggle, and when placed at par with coin by the resumption act has proven to be the best paper money created by legislation in this or any other country.

The issue of circulating notes by state banks had been the fruitful cause of loss, contention and bankruptcy, not only of the banks issuing them, but of all business men depending upon them for financial aid. Inflation and apparent prosperity were often followed by the closing of one bank and distrust of all others. The notes of a broken bank were rarely paid, the assets of such bank being generally applied to the payment of other liabilities, leaving the loss to fall on the holders of the notes, mostly innocent persons of limited means. This led to the adoption in 1846 of the sub- treasury system, by which all payments to the treasury were required to be in coin, to be held until required for disbursements on government account. This protected the United States, but it did not save the people from loss, as, from necessity, they were compelled to use bank bills authorized by the several states, varying in value and security, and chiefly limited in circulation to the state in which issued. With a narrow view of the powers of the national government, Congress had repeatedly refused to authorize a national bank, a policy I heartily approve, not from a doubt of the power of Congress to grant such a charter, but from the danger of intrusting so vast a power in a single corporation, with or without security. This objection did not lie against the organization of a system of national banks extending over the country, which required every dollar of notes issued to be secured by a larger amount of bonds of the United States, to be deposited in the treasury of the United States, thus saving the note holder from all possibility of loss.

Secretary Chase, in his report of December 9, 1861, recommended that a tax be imposed upon notes issued by state banks and also that Congress should exercise its authority to establish a system of national banks, with proper safeguards and limitations. A bill was introduced for the latter purpose in the House of Representatives in 1861, but, owing to the urgency for legislation on war measures, it was not acted upon.

CHAPTER XIII. ABOLISHMENT OF THE STATE BANKS. Measures Introduced to Tax Them out of Existence--Arguments That Induced Congress to Deprive Them of the Power to Issue Their Bills as Money--Bill to Provide a National Currency--Why Congress Authorized an Issue of $400,000,000, of United States Notes--Issue of 5-20 and 10-40 Bonds to Help to Carry on the War--High Rates of Interest Paid--Secretary Chase's Able Management of the Public Debt--Our Internal Revenue System--Repeal of the Income Tax Law--My Views on the Taxability of Incomes.

Long before I became a Member of Congress I had carefully studied the banking laws of the several states. The State of Ohio adopted, in 1846, an improved system of banking. My study and experience as a lawyer in Ohio convinced me that the whole system of state banks, however carefully guarded, was both unconstitutional and inexpedient and that it ought to be overthrown. When I entered Congress I was entirely prepared, not only to tax the circulation of state banks, but to tax such banks out of existence. But, while this feeling prevailed in the west, the opposite feeling prevailed in the New England and Middle States, where their banking system had been so improved that bank failures were rare, and bank bills were protected by mutual guaranties.

The Secretary of the Treasury had, in two annual messages, proposed a tax on the circulation of bank bills. He believed that the existing bank circulation prevented or embarrassed the process of funding, by which alone the bonds of the United States could be absorbed. He was forbidden by law to receive bank bills in exchange for bonds or for any purpose, so that the current money of the people was not available for the purchase of bonds. This was an additional argument for taxing the state banks out of existence. I introduced a measure for this purpose as an amendment to the revenue bill, but it was postponed to save it from defeat.

I introduced a bill in January, 1863, containing two sections, the first to levy a tax of two per cent. per annum on the circulation of all bank bills, and the second to provide for a tax of ten per cent. on all fractional currency under one dollar issued by corporations or individuals. Upon this bill I made a carefully prepared speech, not only defending the proposed tax, but declaring my purpose to urge a gradual increase of the tax until all state bank bills were excluded from circulation. As the reversal of this policy is threatened I feel justified in briefly restating the argument that induced Congress to deprive all state banks of the power to issue their bills as money.

I drew the distinction between the ordinary powers of banking and the issue of bank bills. I said that the business of banking proper consisted in loaning money, discounting bills, facilitating exchanges of productions by the agency of commercial paper, and in receiving and disbursing the deposits of individuals. The issue of bank bills was an exclusive privilege conferred only on a few corporations. It was a privilege that an individual could not enjoy. No person could issue his bills in the form of paper money without a corporate franchise granted him and his associates, either by a general banking law, or by an act of incorporation. All the business of banking might be exercised by private individuals except this franchise. There was no reason why any one individual or a partnership might not carry on all the business incident to banking except this one of issuing bills to circulate as money. The largest banking houses in the world did not exercise the privilege of issuing bills. The strongest banks in the United States, such as the Bank of Commerce of New York, had but little or no circulation, while the weakest banks supported themselves and made profit by issuing the largest quantity of bills authorized. The law then existing taxed heavily the business of banking proper. All commercial paper--checks, drafts, orders, bills of exchange, protests, bonds --every instrument that was used in the ordinary process of banking --was heavily taxed, while bank bills were not taxed at all. A private banker doing business had to pay a license of $100, but a bank of circulation was expressly exempted from the necessity of procuring a license. The tax law, as it stood, had this significant provision: "But not to include incorporated banks legally authorized to issue notes as circulation." Every commercial instrument was required to pay a stamp tax, but this did not attach to a bank bill. Bank notes issued for circulation were expressly excepted. The only tax levied upon banks of circulation was a tax of three per cent. on the net income. This tax could be deducted from the dividend of the stockholders. The discrimination in favor of banks of circulation ran through all the tax laws, while other corporations, such as railroad companies, insurance companies and the like, were subject to heavy taxes.

The profits of banking were then very great. The average profits of the banks of New York were twelve and one half per cent. per annum. The burdens imposed upon the banks by their charters were lessened by the suspension of specie payments. When the banks had to keep in their vaults coin to the amount of one-third of their circulation, and were liable to be called upon any day for the redemption of their notes in gold and silver, they might claim exemption from taxes on their circulating notes. But during the suspension of coin payment there ws no such liability. Whether right or wrong the banks suspended specie payments, and increased their currency without paying either principal of it or interest, or tax on it, though in direct violation of law in some states.

I referred in my speech to an interview which was sought by the banks of our chief commercial cities with the Secretary of the Treasury, to which they invited the financial committees of the two Houses to hear their propositions for carrying on the financial operations of the government. We all went to the office of the Secretary of the Treasury, and the proposition was there made that the United States should issue no paper money whatever, that the specie clause, as it is called, of the sub-treasury act should be repealed, and that we should carry on the war upon the basis of the paper money of the banks, legalizing the suspension of specie payments, and that the government should issue no paper except upon an interest of six per cent., or higher if the money markets of the world demanded more. That was their plan of finance, the plan substantially adopted in the War of 1812, and which had been condemned by every statesman since that time, a plan of carrying on the operations of our government by an association of banks over which Congress had no control, and which could issue money without limit so far as national laws affected it. That was the scheme presented to us by very intelligent gentlemen engaged in the banking business. They were honest and in earnest, but it appeared to me as pretentious and even ludicrous.

It was claimed that a tax on banks interfered with vested rights. I said that all taxes that were levied by the government were to maintain vested rights, liberty and life. All these corporate franchises were held subject to the power of taxation in Congress, which was sometimes necessary to be exercised in the most potent manner in order to maintain the government. The state could not, by an act of incorporation, place their property beyond the power of Congress. The only question was what rate of taxation ought to be adopted. The rate proposed--two per cent.--I insisted was not too high, because it was only one-third of the profit derived from the issue of paper money without interest, the principal of which was not paid in coin. I stated distinctly that the purpose of the bill was not merely to levy a reasonable tax on the banks, but also to induce them to withdraw their paper, in order to substitute for it a national currency. I then reviewed in considerable detail the history of our currency legislation, from the act chartering the first bank of the United States to the beginning of our Civil War, showing the view taken by the most eminent statesmen of our country in favor of the establishment of uniform national currency as the highest object of legislation. Mr. Madison said in his message:

"It is, however, essential to every modification of the finances that the benefits of a uniform national currency should be restored to the community. The absence of the precious metals will, it is believed, be a temporary evil; but, until they can again be rendered the general medium of exchange, it devolves on the wisdom of Congress to provide a substitute which shall equally engage the confidence and accommodate the wants of the citizens throughout the Union."

I said that when coin, the best of currency, was driven out of circulation, by the existence of war or extraneous circumstances, it was the duty of Congress to provide a substitute. In 1816 Congress did this by establishing the Bank of the United States. Most of the state banks shortly afterward exploded, and almost their entire issue outstanding at the time fell as a loss to the people of the United States. The Bank of the United States did furnish for a while a stable currency. After its charter expired in 1836, the controversy was between gold and silver, and paper money as a currency. Nearly all the statesmen of that time believed it was necessary to have a national currency in some form, but there was a part in the country that believed the only true national currency was gold and silver coin. After a controversy that I would not review, the sub-treasury system was finally adopted. The government had then no occasion to borrow money. Its debt was paid off and there was a large surplus in the treasury, which was distributed among the states. The agency of a United States bank was no longer necessary to sustain the public credit. The object then was to secure a safe deposit and custody of the public revenues. The state banks failed to furnish a safe redeemable currency. In 1837 their notes were in the hands of the people, depreciated and dishonored, if not entirely worthless. Therefore, I thought wisely, the sub-treasury system was adopted, by which gold and silver coin was the only money received or paid out by the government. I believed that such was a true policy in the absence of national banks. I also stated that if peace were restored to our country, we ought, as soon as possible, to go back to the basis of gold and silver coin, but, in the meantime, we must meet the exigencies of the hour. Paper money was then a necessity. Gold and silver were hoarded. War always had led, and always would lead, to the hoarding of the precious metals. Gold and silver flee from a state of war. All nations in the midst of great wars have been compelled to resort to paper money. It was resorted to by our fathers during the Revolution. It was only by the use of paper money that England maintained her wars with Napoleon. At several periods during these wars gold and silver were at a greater premium in England than they were in this country.

I then proceeded to discuss the power of Congress to issue paper money. I quoted an extract from the report of Mr. Dallas, in December, 1815, in which he stated:

"By the constitution of the United States, Congress is expressly vested with the power to coin money, to regulate the value of domestic and foreign coin in circulation, and (as a necessary implication from positive provisions) to emit bills of credit; while it is declared by the same instrument that 'no state shall coin money, or emit bills of credit.' The constitutional authority to emit bills of credit has also been exercised in a qualified and limited manner. . . .

"The constitutional and legal foundation of the monetary system of the United States is thus distinctly seen; and the power of the federal government to institute and regulate it, whether the circulating medium consist of coin or of bills of credit, must, in its general policy, as well as in the terms of its investment, be deemed an exclusive power."

These extracts from a document of great ability, state the whole question in a few words. Congress has the power to regulate commerce; Congress has the power to borrow money, which involves the power to emit bills of credit; Congress has the power to regulate the value of coin. These powers are exclusive. When, by the force of circumstances beyond our control, the national coin disappears, either because of war or of other circumstances, Congress alone must furnish the substitute. No state has the power to interfere with this exclusive authority in Congress to regulate the national currency, or, in other words, to provide a substitute for the national coin.

I next stated the objections to local banks. The first was the great number and diversity of bank charters. There were 1,642 banks in the United States, established by the laws of twenty-eight different states, and these laws were as diverse, I might say, as the human countenance. We had the state bank system with its branches. We had the independent system, sometimes secured by local bonds, sometimes by state bonds, sometimes by real estate, sometimes by a mixture of these. We had every diversity of the bank system in this country that has been devised by the wit of man, and all these banks had the power to issue paper money. With this multiplicity of banks, depending upon different organizations, it was impossible to have a uniform national currency, for its value was constantly affected by their issues. There was no common regulator; they were dependent on different systems. The clearing house system adopted in the city of New York applied only to that city. There was no check or control over these banks. There was a want of harmony and concert among them. Whenever a failure occurred, such as that of the Ohio Life Insurance and Trust Company, it operated like a panic in a disorganized army; all of the banks closed their doors at once and suspended specie payments.

Another objection to these local banks was that of their unequal distribution among the states. In New England the circulation of the banks was about $50,000,000, while in Ohio, a state with three- fourths of the population of all New England, it was but $9,000,000. The contrast, if made with other states, was still more marked. I called attention to the fact that the circulation of banks in the eastern states had then reached about $130,000,000, and of that amount, $40,000,000 was circulating in the west. If these notes were driven out of circulation and the United States notes substituted, a contribution would be made to the treasury of the United States of $2,400,000 a year, for the mere interest of a currency which the west did not prefer, but was compelled to use.

I called attention to the loss to the people by counterfeiting, which could not be avoided when we had such a multitude of banks. It then required experts to detect counterfeits. It was impossible to prevent counterfeiting. An expert could save the banks, but the loss fell upon the people. By the substitution of national currency we substantially could lose nothing by counterfeiting. The notes would be few in kind, only three or four of them, all issued by the United States, all of a uniform character, that could not be counterfeited. I described, with some detail, the loss to the people of the United States by bills of broken banks, computed them to be equivalent to five per cent. per annum of all the bills issued. On an average, every twenty years the entire bank circulation ceased to exist or deteriorated.

The loss of exchange from the west to the east on local currency was one per cent. This loss was usually made a gain to themselves by the bankers and "shavers." Under the most favorable state of trade between the east and west an exchange of one per cent. was demanded from drafts and bills of exchange. With a national currency, uniform and equal throughout the country, this cost for exchange would not exist or would be greatly reduced. I called attention to the then increasing volume of local currency in the United States. When the United States had issued $250,000,000 of notes, the banks had largely increased their circulation. This tended to depreciate both United States and bank notes.

I discussed at similar length the proposition that, as the states were forbidden by the constitution to authorize the issue of bills of credit, they were equally forbidden to authorize corporations to issue circulating notes, which were bills of credit. Upon this point it seemed to me that the authorities were absolutely conclusive. That position was taken by the most eminent members of the constitutional convention, by Joseph Story in his "Commentaries," by Daniel Webster, and other great leaders of both parties since that time. It was in reference to these bills that Mr. Webster used the language often quoted:

"A disordered currency is one of the greatest of political evils. It undermines the virtues necessary for the support of the social system, and encourages propensities destructive of its happiness. It wars against industry, frugality, and economy; and it fosters the evil spirits of extravagance and speculation. Of all the contrivances for cheating the laboring classes of mankind, none has been more effectual than that which deludes them with paper money. This is the most effectual of inventions to fertilize the rich man's field by the sweat of the poor man's brow. Ordinary tyranny, oppression, excessive taxation, these bear lightly on the happiness of the mass of the community, compared with a fraudulent currency, and the robberies committed by depreciated paper."

In speaking of the bank circulation then afloat in the country, he further said:

"It is further to be observed that the states cannot issue bills of credit; not that they cannot make them a legal tender, but that they cannot issue them at all. Is not this a clear indication of the intent of the constitution to restrain the states, as well from establishing a paper circulation as from interfering with the metallic circulation? Banks have been created by states with no capital whatever, their notes being put into circulation simply on the credit of the state or the state law. What are the issues of such banks but bills of credit issued by the state? I confess, Mr. president, that the more I reflect on this subject, the more clearly does my mind approach the conclusion that the creation of state banks, for the purpose and with the power of circulating paper, is not consistent with the grants and prohibitions of the constitution."

I insisted that if there was no money in this country but United States notes, the process of funding would be going on day by day. Whenever there was too great an accumulation of these notes they would be converted into bonds; the operation would go on quietly and silently. I quoted the authority of Secretary Chase that it was his deliberate judgment, after watching this process with all his conceded ability, that but for the influence of this local bank paper he would be able to carry on the war without the issue of more paper money, that the currency then outstanding and that which by law he was authorized to issue would be sufficient to carry it on. Such a currency would lead to the conversion of the notes into bonds, and by this process the people would absorb the national loan and enable him to carry on the government without any sacrifice to them.

It was not strange that Mr. Jefferson, near the close of the War of 1812, stated more clearly than I could do the conflict between local bank paper and United States notes. He, who during his whole life was so mindful of the rights of the states, and so jealous of paper money, in brief and terse language designated the only way in which our country could carry on war. In his letter to Mr. Cooper, dated September 10, 1814, just at the close of the war, he said:

"The banks have discontinued themselves. We are now without any medium, and necessity, as well as patriotism and confidence, will make us all eager to receive treasury notes, if founded on specific taxes.

"Congress may now borrow of the public, and without interest, all the money they may want, to the amount of a competent circulation, by merely issuing their own promissory notes of proper denominations for the larger purposes of circulation, but not for the small. Leave that door open for the entrance of metallic money. . . . Providence seems, indeed, by a special dispensation, to have put down for us, without a struggle, that very paper enemy which the interest of our citizens long since required ourselves to put down, at whatever risk.

"The work is done. The moment is pregnant with futurity, and if not seized at once by Congress, I know not on what shoal our bark is next to be stranded. The state legislatures should be immediately urged to relinquish the right of establishing banks of discount. Most of them will comply, on patriotic principles, under the convictions of the moment, and the non-complying may be crowded into concurrence by legitimate devices."

I also quoted another extract to show that this matter filled the mind of Mr. Jefferson. He said:

"Put down the banks, and if this country could not be carried through the longest war, against her most powerful enemy, without ever knowing the want of a dollar, without dependence on the traitorous classes of her citizens, without bearing hard on the resources of the people, or loading the public with an indefinite burthen of debt, I know nothing of my countrymen. Not by any novel project, not by any charlatanry, but by ordinary and well-experienced means; by the total prohibition of all paper at all times, by reasonable taxes in war, aided by the necessary emissions of public paper of circulating size, this bottomed on special taxes, redeemable annually as this special tax comes in, and finally within a moderate period--even with the flood of private paper by which we were deluged--would the treasury have ventured its credit in bills of circulating size, as of five or ten dollars, etc., they would have been greedily received by the people in preference to bank paper."

On the 26th of January, 1863, I introduced in the Senate a bill to "provide a national currency, secured by a pledge of United States stocks, and for the circulation and redemption thereof." This bill took the usual course, was referred to the committee on finance, was reported favorably with a number of amendments, and was fully debated in the Senate. On the 9th of February, 1863, a cursory debate occurred between Mr. Collamer, of Vermont, and myself, which indicated a very strong opposition to the passage of the banking bill. Various amendments were proposed and some adopted. I became satisfied that if a strong effort was not made the bill would either be defeated or postponed. I then, without preparation, made a long, and as I think, a comprehensive, speech covering the general subject and its principal details. It was the only speech of considerable length that was made in favor of the bill in the Senate. There seemed to be a hesitancy in passing a measure so radical in its character and so destructive to the existing system of state banks.

I said the importance of the subject under consideration demanded a fuller statement than had as yet been made of the principle and object of the bill. It was the misfortune of war that we were compelled to act upon matters of grave importance without that mature deliberation that would be secured in peaceful times. The measure affected the property of every citizen of the United States, and yet our action for good or evil must be concluded within a few days or weeks of that session. We were to choose between a permanent system designed to establish a uniform national currency based on the public credit, limited in amount, and guarded by all the restraints which the experience of men had proved necessary, and a system of paper money without limit as to amount, except for the growing necessities of war.

I narrated the history of the bill, of its introduction in December, 1861, its urgent recommendation by the Secretary of the Treasury in two annual reports, and the conditions that then demanded immediate action upon it. I stated the then financial condition of the country. Gold was at a premium of between fifty and sixty per cent. and was substantially banished from circulation. We were in the midst of war, when the necessities of the government required us to have large sums of money. We could not choose as to the mode in which we should get that money. If we pursued the ordinary course, the course that had been sufficient in times of peace to raise money, of putting our bonds into the market and selling them for what they would bring, it would be at a great sacrifice. We knew this from the history of other nations and from our own experience. We therefore must look for some system of finance that would give us all the aid possible, either in the form of paper money or by the agencies of associated banks. We knew very well that after the war was over the government would still be largely in need of money.

I then reviewed the various financial measures since the commencement of the war. We were then in the peculiar condition of a nation involved in a war without any currency whatever which by law could be used in the ordinary transactions of public business. Gold was withdrawn by the suspension of specie payments. The money of the banks could not be used because the laws of the United States forbade it, and we were without any currency whatever. Under these circumstances, Congress had authorized the issue of $400,000,000 of United States notes. That this measure was wise but few would controvert. We were compelled, by a necessity as urgent as could be imposed upon any legislature, to issue these notes. To the extent to which they were issued they were useful; they were a loan by the public and without interest; they were eagerly sought by our people; they were taken by our enemies in the south, by our friends in the north; they were taken in the east and the west. They furnished the best substitute for gold and silver that could then be devised, and if we could limit United States notes to the amount then authorized by law they would form a suitable and valuable currency.

We had but four expedients from which to choose. First, to repeal the sub-treasury act and use the paper of local banks as a currency; second, to increase largely the issue of United States notes; third, to organize a system of national banking, and fourth, to sell the bonds of the United States in the open market. I discussed each of these expedients in considerable detail. The practical objection to the further issue of United States notes was that there was no mode of redemption; they were safe; they were of uniform value, but there was no mode pointed out by which they were to be redeemed. No one was bound to redeem them. They were receivable but not convertible. They were debts of the United States but could not be presented anywhere for redemption. No man could present them except for the purpose fo funding them into the bonds of the United States. They were not convertible into coin. They lacked that essential element in currency.

Another objection was that they were made the basis of state bank issues. Under the operation of the act declaring United States notes to be a legal tender, the state bank circulation had increased from $120,000,000 to $167,000,000. The banks sold their gold at a large premium, and placed in their vaults United States notes with which to redeem their own notes. While the government had been issuing its paper money some of the banks were inflating the currency, by issuing paper money on the basis of United States money. Illustrations of this inflation were given of existing banks, showing enormous issues based upon a comparatively small amount of legal tender notes. The issue of United States notes by the government, and the making them a legal tender, was made the basis of an inflated bank circulation in the country, and there was no way to check this except by uniting the interest of the government, the banks, and the people, together, by one uniform common system.

I said that during war local banks were the natural enemies of a national currency. They were in the War of 1812. Whenever specie payment was suspended, the power to issue a bank note was the same as the power to coin money. The power granted to the Bank of France and the Bank of England to issue circulating notes was greatly abused during the period of war. It was a power that ought never to be exercised except by the government, and only when the state was in danger. It was the power to coin money, because when a bank issued its bill without the restraint of specie payments, it substantially coined money and false money. This was a privilege that no nation could safely surrender to individuals or banks. Upon this point I cited a number of authorities, not only in our own country, but in Europe. While I believed that no system of paper money should depend upon banks, I was far from objecting to their agency. They were useful and necessary mediums of exchange, indispensable in all commercial countries. The only power they derived from corporation not granted to all citizens was to issue notes as money, and this power was not necessary to their business or essential to their profit. Their business connected them with the currency, and whether it should be gold or paper they were deeply interested in its credit and value. Was it not then possible to preserve to the government the exclusive right to issue paper money, and yet not injuriously affect the local banks? This was the object of that bill.

But, it was asked, why look at all to the interest of the banks, why not directly issue the notes of the government, and thus save to the people the interest on the debt represented by the notes in circulation? The only answer to this was that history taught us that the public faith of a nation alone is not sufficient to maintain a paper currency. There must be a combination between the interests of private individuals and the government. Our revolutionary currency, continental money, depreciated until it became worthless. The assignats of France, issued during her revolutionary period, shared the same fate. Other European countries which relied upon government money alone had a similar experience. An excessive issue of paper money by the government would produce bankruptcy and repudiation, not only of the notes abroad, but of bonds also. The government of the United States had in circulation nearly $400,000,000 United States notes. We had a bank circulation of $160,000,000. If we increased our circulation, as was then proposed, it would create an inflation that would evidently lead to the derangement of all business affairs in the country. Whatever might be the hazards, we had to check this over expansion and over issue. If a further issue of United States notes were authorized, it would be at once followed by the issue of more bank paper, and then we would have the wildest speculation. Hitherto the inflation had not extended to many articles. Real estate had not been much affected by it.

The question then occurred whether the bank bill proposed by the Secretary of the Treasury, and introduced by me into the Senate, would tend to secure a national currency beyond the danger of inflation. This, the principal question involved, was discussed at length. I contended that the notes issued would be convertible into United States notes while the war lasted, and afterwards into coin; that the currency would be uniform, of universal credit in every part of the United States, while the bank bills, which it would supersede, were current only in the states in which they were issued. It would furnish a market for our bonds by requiring them to be held as the security for bank notes, and thus advance the value of the bonds. The state bank bills would be withdrawn, and the state banks would be converted into national banks with severe restrictions as to the amount of notes issued, and these only issued to them by the general government upon ample security. The similarity of notes all over the United States would give them a wider circulation. I insisted that the passage of the bill would promote a sentiment of nationality.

The policy of this country ought to be to make everything national as far as possible. If we were dependent on the United States for a currency and a medium of exchange, we would have a broader and more prosperous nationality. The want of such nationality, I then declared, was one of the great evils of the times; and it was that principle of state rights, that bad sentiment that had elevated state authority above the great national authority, that had been the main instrument by which our government was sought to be overthrown. Another important advantage the banks would derive from this system, I urged, would be that their notes would be guarded against all frauds and all alterations. There would be but five or six kinds of notes in the United States, instead of the great diversity there was then. In 1862 the number of banks existing was 1,500, and the number whose notes were not counterfeited was 253. The number of kinds of "imitations" was 1,861. The number of kinds of "alterations" was 3,039. The number of kinds of "spurious" was 1,685. This was the kind of currency that was proposed to be superseded. Under the new system, the banks would be relieved from all this difficulty.

Other advantages to the banks would be that they might become depositaries of the public money, that their notes, being amply secured, would be received in all payments due to or from the United States, while the notes of state banks could not be so received, as they were dishonored and disgraced from the beginning, being refused by the national government.

This is an imperfect view of the question as it was then presented to my mind. I knew the vote upon the passage of the bill would be doubtful. The New England Senators, as a rule, voted for the bill, but Senators Collamer and Foote had taken decided grounds against it, and it was believed that Mr. Anthony and his colleague would do likewise. I informed Secretary Chase of my doubt as to the passage of the bill, and especially whether Mr. Anthony would vote for it; without his vote I did not think it would pass. Mr. Chase called at the Senate and had an interview with Mr. Anthony, in my presence, in which he urged him strongly, on national grounds, to vote for the bill, without regard to local interests in his own state. His remarks made an impression upon Mr. Anthony who finally exclaimed that he believed it to be his duty to vote for the bill, although it would be the end of his political career. When the vote was taken his name was the first recorded in favor of the bill. It passed by a vote of 23 yeas and 21 nays, so that I was entirely correct that if he had voted against the bill it would have been defeated by a tie vote.

These two measures, the absorption of the state banks, and the establishment of the system of national banks, taken in connection with the legal tender act, were the most important financial measures of the war, and, tested by time, have fully realized the anticipations and confident assurance of their authors.

This system of national banks has furnished to the people of the United States a currency combining the national faith with the private stock and private credit of individuals. They have a currency that is safe, uniform, and convertible. Not one dollar of the notes issued by national banks has been lost to any person through the failure of a bank. We have a currency limited in amount, restrained and governed by law, checked by the power of visitation and by the limitation of liabilities, safe, uniform, and convertible in every part of the country. Every one of these conditions prophesied by me has been literally realized.

Next in importance to a national currency was the problem of the public debt. The issue of $50,000,000, demand notes, authorized in 1861, was a forced expedient to meet immediate demands. A prudent man, engaged in business, would not borrow money payable on call unless he had securities which he could immediately convert into money. Such liabilities are proper in a stock exchange or in a gambling operation, to be settled by the receipt or payment of balances on the rise or fall in the market of stocks or produce. These demand notes gave Secretary Chase more trouble than any other security, and they were finally absorbed in the payment of customs duties.

On the 17th of July, 1861, Congress authorized the Secretary of the Treasury to borrow, on the credit of the United States, within twelve months, $250,000,000, for which he was authorized to issue bonds, coupon or registered, or treasury notes, the bonds to bear interest not exceeding seven per cent., payable semi-annually, irredeemable for twenty years. The treasury notes were to be of any denominations fixed by the Secretary of the Treasury, not less than fifty dollars, and to be payable three years after date, with interest at the rate of seven and three-tenths per cent. per annum, payable semi-annually. He was also authorized to issue, in exchange for coin, as a part of the loan of $250,000,000, treasury notes payable on demand, already referred to, or treasury notes bearing interest at the rate of three and sixty-five hundredths per cent. per annum, and payable in one year from date and exchangeable at any time for treasury notes of fifty dollars and upwards. These forms of security were the most burdensome that were issued by the government during the war. The terms of these securities were somewhat altered by the act approved August 5, 1861.

These laws were superseded by the act of February 28, 1862, which may be regarded as the most important loan law passed during the war. It authorized the Secretary of the Treasury to issue, on the credit of the United States, $150,000,000 of United States notes, commonly called greenbacks, already described. Of these, $50,000,000 were to be in lieu of the demand treasury notes authorized to be issued by the act of July, 1861, above referred to. It also authorized the Secretary of the Treasury to issue $500,000,000 of coupon, or registered, bonds, redeemable at the pleasure of the United States after five years, and payable twenty years from date, bearing interest at the rate of six per cent. per annum, payable semi-annually. These are what were known as the 5-20 bonds. In reference to these securities, Secretary Chase, in his report of December 4, 1862, said:

"These measures have worked well. Their results more than fulfilled the anticipations of the secretary. The rapid sale of the bonds, aided by the issue of United States notes, furnished the means necessary for the conduct of the war during that year."

On the 3rd of March, 1863, the Secretary of the Treasury was authorized to borrow, from time to time, on the credit of the United States, a sum not exceeding $300,000,000 for the current fiscal year, and $600,000,000 for the next fiscal year, payable in coin, at the pleasure of the government, after such periods as may be fixed by the secretary, not less than ten, or more than forty, years from date. These bonds, known as the 10-40's, bearing five per cent. interest, were exempt from taxation by or under state or municipal authority. This act also provided for the issue of a large increase of non-interest bearing treasury notes, which were made lawful money and a legal tender in payment of all debts, public or private, within the United States, except for duties on imported goods and interest on the public debt. Additional 10-40 bonds were authorized by the act of June 30, 1864. But it may be said that the 5-20 and 10-40 bonds became the well-known, recognized securities of the United States, the sale of which at par, in connection with the treasury notes of different forms, furnished the United States the money to carry on the war. In the sale of these securities the secretary was actively assisted by the banks and bankers of the United States, and especially by Jay Cooke, who was the most effective agent of the government in the sale of 5-20 bonds.

Secretary Chase, in his report of December 10, 1863, discussed at length the objects to be kept studiously in view in the creation of debt by negotiations of loans or otherwise: First, moderate interest; second, general distribution; third, future controllability; and, fourth, incidental utility.

The first loans were made upon the extravagant rate of interest of seven and three-tenths per cent. The reason for this was the fact that there was no currency the secretary could receive in exchange for bonds. As already stated, specie payments were suspended by the banks December 31, 1861. He was forbidden by law to receive bank bills, and he knew that Congress would not and ought not to repeal this law. After such suspension coin was scarce and difficult to obtain. Afterwards, when the legal tender notes were authorized and issued, he sold his bonds bearing six per cent. interest at par for notes, but these notes had already largely depreciated compared with coin. Still, they were money, readily taken for all supplies, and enabled him to sell securities running a shorter period. A diversity of securities maturing at different times were exchanged for notes, and finally he was able to sell five per cent. bonds at par, so that, on the 30th of September, 1863, two months previous to his report, securities and notes then outstanding amounted to $1,222,113,559. The fist bonds were irredeemable for twenty years. The second bonds were redeemable in five, but payable in twenty, years. The third bonds, bearing five per cent. interest, were redeemable after ten years. It will be perceived that under this arrangement the rate of interest on securities issued was constantly reduced. The notes received in payment of bonds depreciated or advanced in sympathy with the progress of our armies and the prospects of success. The general purpose was to secure as low a rate of interest as possible, to distribute the securities among the largest number of persons possible, to provide the best mode, time and terms for redemption, and to put the securities in such form as to be used as a currency. No one can question the wisdom of the management of the public debt by Secretary Chase.

The origin and development of the present system of internal taxes must be interesting to every student of finance. The policy of the government had been to confine, as far as possible, national taxes to duties on imports, and, in ordinary times, this source of revenue, exclusively vested in the United States, together with the proceeds of the sale of public lands, was ample to defray the current expenses of the government. During and shortly after the War of 1812 resort was had to direct taxes apportioned among the states respectively, and to internal taxes authorized by the constitution under the name of excises, but the necessities of the treasury becoming more urgent, and the reliance on the public credit becoming more hazardous, Congress, at the special session which convened in May, 1813, determined to lay the foundations of a system of internal revenue, selecting in particular those subjects of taxation which would be least burdensome. These taxes were at first limited to one year, but were extended from time to time, so that they acquired the name of "war taxes." A direct tax of $3,500,000 was laid upon the United States, and apportioned among the states respectively for the year 1814. Taxes were imposed on sugar refined in the United States, on carriages, on licenses to distillers of spirituous liquors, and other forms of internal production. It was estimated that the internal taxes and the direct tax would yield $3,500,000. For the fiscal year ending June 30, 1815, internal taxes yielded $5,963,000. In 1816 they yielded $4,396,000. In 1817 they yielded $2,676,000, after which there was no revenue from internal taxes except from the collection of arrears, amounting in 1818 to $947,946, the law providing for such taxes having expired by limitation. A comparison between the receipts from this source then and the receipts subsequently derived from internal revenue, is a significant indication of the difference in population and wealth between 1812 and 1862.

When the Civil War commenced and the necessity of a large increase of revenue became apparent, Secretary Chase, in his report to Congress of the date of July 4, 1861, called attention to the necessity of provision for a gradual increase in the revenue to maintain the public credit, and to meet the current demands. His recommendation as to internal taxes has already been referred to. The act of August 5, 1861, previously mentioned, levied a direct tax of $20,000,000 and an income tax. This act proved to be a crude and imperfect measure, and it was modified or superseded by the act of July 1, 1862. This act, carefully framed, was the basis of the present system of internal revenue. It created a new office in the treasury department, to be called the office of commissioner of internal revenue. No less than thirteen acts of Congress were passed prior to August 1, 1866, enlarging and defining the duties of the office, and prescribing the taxes imposed by these several laws. When this act was first framed we anticipated much greater difficulties in the collection of the tax than actually occurred. We had doubts whether the taxation imposed by this law would be patiently submitted to by our constituents, but these misgivings soon disappeared and the taxes imposed by that act were cheerfully and promptly paid. I gave to the study and consideration of this act, and the various amendatory acts, a large portion of my time. At the end of the war internal taxes were cheerfully paid by the people, and yielded far more revenue to the government than the customs duties and all other sources of revenue combined.

The receipts from internal revenue for the first four years under this law were as follows;

For the year ending June 30, 1863 . . . . $37,640,787 For the year ending June 30, 1864 . . . . 117,145,748 For the year ending June 30, 1865 . . . . 211,129,529 For the year ending June 30, 1866 . . . . 310,906,984

These taxes were mainly upon spirits, tobacco and beer, but they also included stamp taxes of various kinds, special taxes on particular industries, and income taxes, so that practically nearly all forms of domestic manufactures were subject to a greater or less tax, according to the nature of the article. So sweeping were the provisions that it was frequently a matter of joke as well as comment.

Some one remarked to Senator Collamer that everything was taxed except coffins. He rejoined: "Don't say that to Sherman or he will have them on the tax list before night!"

The general prosperity that existed during the war under such a burden of taxation was frequently a matter of surprise. The truth is that all productive industries were active because of the enormous demand made by the army for supplies of all kinds, and everyone who was willing to work could find plenty of employment. The depreciation of the currency caused by the war did not embarrass anyone, as the interest on securities was promptly paid in coin, and greenbacks were the favorite currency of the people. The people did not stop to inquire the causes of the nominal advance in prices; they only knew that the United States note was cheerfully received in every part of the United States as the current money of the country. At the beginning the tax on whisky was 20 cents per gallon, but it was gradually increased until it reached $2 a gallon, when frauds and illicit distilling became serious evils. The tax was then reduced to 90 cents a gallon.

When I became Secretary of the Treasury, I was impressed with the magnitude of illicit distilling, even after the rate was reduced. At that time several hundred men, mostly in the mountain regions of North Carolina and Tennessee, were under arrest for violation of the laws against illicit distilling. A delegation of them, accompanied by Senator Ransom, appeared before me, and I heard their apologies for distilling, and their complaints against the officers. We entered into a formal engagement by which they agreed to stop illicit distilling upon condition that they should be relieved of punishment for their past acts, and, so far as I could learn, they substantially observed their obligation. As a rule, they were rough mountaineers who regarded whisky as a prime necessity of life, and thought they ought to be allowed to convert their grain into something better.

As the necessity for excessive taxation diminished after the war was over, taxes on various articles were gradually repealed, until, in 1894, they consisted of practically four items, spirits, tobacco, fermented liquors, and oleomargarine. These are the figures for two years:

Receipts during fiscal years Objects of Taxation. ended June 30-- 1893. 1894. Spirits . . . . . . $94,720,260.55 $85,259,252.25 Tobacco . . . . . . 31,889,711.74 28,617,898.62 Fermented Liquors . 32,548,983.07 31,414,788.04 Oleomargarine . . . 1,670,643.50 1,723,479.90

In respect to these taxes, that on oleomargarine was not intended as, nor is it, a very material revenue tax. The purpose was especially to prevent the fraudulent imitation of butter by using an extract of beef. The tax on spirits, tobacco and beer ought to be retained as the best objects of taxation either of domestic or imported goods. Neither of these is an article of necessity, but all are used purely to gratify an appetite, in many cases indulged to excess.

All civilized nations have come to regard these articles as the best subjects of taxation. To the extent that whisky is used as a beverage it is hurtful in its influence upon the individual and upon society at large. It is the cause of innumerable crimes, of poverty and distress in the family and home. Still, it is an appetite that will be gratified, however severe may be the laws against its use, and while this habit exists the tax upon whisky, by limiting the quantity consumed, is beneficial to society at large. It is true that alcohol, the base of whisky, is useful in the arts and in the preparation of medicines and vinegar. If some feasible plan could be prescribed by which alcohol or spirits thus used could be freed from tax, it would be right to exempt it, but no such plan has been found that includes security against frauds being practiced to evade the tax on whisky. The tax on tobacco and cigars is a moderate one, but the consumption of them is far less dangerous than that of spirits in their influence upon society. The tax on the cheaper form of tobacco and cigars is comparatively small and does not add materially to the cost of tobacco in any of its forms. No complaint is made of it. Its consumption is so general that the tax is fairly distributed and falls mainly on the richer classes, as the tax is increased in proportion to the value of the tobacco. Beer, a beverage of almost universal use, yields the large sum of $30,000,000 a year, at the rate of one dollar a barrel. This does not cause a perceptible increase of the cost to the consumer, but rather tends to maintain the good quality of beer by the surveillance of the officers of internal revenue. No general complaint has been made of this tax. All internal taxes are collected at less cost than any other form of taxation devised, and should be maintained as long as the expenses growing out of the war shall remain unpaid.

The patience and even cheerfulness with which the people of the United States submitted to this severe taxation on their domestic productions, was a matter of surprise, not only among our own people, but in European countries. In 1867, accompanied by Mr. Adams, our minister to England, I had the pleasure of breakfasting with Mr. Gladstone at his official residence, and he referred to the ease with which we collected, without complaint, taxes so burdensome as ours then were. He asked me if it was true that we had collected $1,600,000 annually from a tax on matches. I told him that we not only did so but that I had never heard a word of complaint, and the quality of matches was vastly improved while their price was actually reduced. He threw up his hands and said that the people of England would not submit to such tax and if any ministry would propose it, it would soon be out of power. Strange to say an administration of which Mr. Gladstone was at the head did subsequently propose such a tax, but it was so severely arraigned that it was at once abandoned.

The income tax, varied somewhat in terms from year to year, continued in force until 1870, when it was proposed to repeal it as no longer necessary. By the terms of the then existing law it expired in 1872. I urged as strongly as I could its retention at least until the time expired, but it was repealed. I then believed, and now believe, that a moderate income tax, levied on all incomes above the sum of $1,000, or above a sum that will supply the ordinary wants of an average family in the United States with the necessaries of life, should be levied, according to the exigencies of the public service. In the present condition of affairs, I doubt the expediency of such a tax, especially in view of the decision of the Supreme Court of the United States recently rendered.

The distinction made by that court between incomes from the rent of land and other incomes seems narrow and technical. A tax upon the value of land is a direct tax, and must be apportioned among the states according to population, but it does not follow that a tax on incomes from land is a direct tax. An income means that gain which results from business, or property, of any kind, from the proceeds of a farm, the profits derived from trade and commerce, and from any occupation or investment. In common language the word income applies to money received from any source. It may be qualified as gross income and net income. It may be limited by words defining the source of the income, as, from land, merchandise or banking, but, in its general sense, it means gross savings from all sources. When received in money it is an income and not until then. An income tax was paid, and cheerfully paid, by American citizens during and since the war, in vast sums, and it did not occur to citizen, lawyer or judge that the constitution of the United States made a distinction between incomes from rents and income from notes or bonds. The states tax both land and bonds. Why may not the United States tax income from each alike? Many of the largest incomes in the United States are derived from rents. To except them by technical reasoning from a general tax on incomes will tend to disparage the Supreme Court among "plain people." If incomes from rents must be excepted, then no income tax ought to be assessed. This decision, if adhered to, may cripple the government in times of emergency. If made when the income tax was first imposed, it would have reduced the national revenue $347,000,000, for no income tax would have been enacted if rents were excluded from taxable incomes.

I do not propose to narrate the numerous internal revenue laws, which have been enacted and modified at every session of Congress since 1861, or the innumerable objects of taxation embraced in them, for such a narrative would fill too much space. The discussion of these laws occupied a large portion of the time of Congress. The articles or productions subject to taxation included for a time nearly everything for the use of man. I trust the time is far distant when such sweeping internal taxation will be required again, but if it should come, the Congress of that day can find in our experience resources more bountiful than Aladdin's lamp.

Direct taxes, to be apportioned among the states, are not likely to be again assessed after the experience we had as to the last direct tax. Besides the difficulty of collecting it, there is the palpable objection that it is an unequal, and therefore an unjust, tax. New states, and especially agricultural states, have not the same ability to pay direct taxes as older commercial and manufacturing states, having within them great cities with accumulated wealth, in the form of stocks, bonds and patents.

The office of commissioner of internal revenue has fortunately been filled, as a rule, by gentlemen of standing and character of a high order of intelligence, and their work has been of great service to the United States. This important bureau ought to be, and no doubt will be, retained as a part of the organized machinery of the government, and the taxes collected by it will be necessary as long as our public debt remains, and until the list of pensioners will be obliterated by the hand of time.

CHAPTER XIV. LINCOLN'S EMANCIPATION PROCLAMATION. Slavery in the District of Columbia Abolished--Law Goes Into Effect on April 10, 1862--Beginning of the End of Slavery--Military Measures in Congress to Carry on the War--Response to the President's Call --Beneficial Effects of the Confiscation Act--Visits to Soldiers' Camps--Robert S. Granger as a Cook--How I Came to Purchase a Washington Residence--Increase of Compensation to Senators and Members and Its Effect--Excitement in Ohio over Vallandigham's Arrest--News of the Fall of Vicksburg and Defeat of Lee at Gettysburg --John Brough Elected Governor of Ohio--Its Effect on the State.

Another question of grave political significance was presented to the 37th Congress early in this session, that of the abolition of slavery in the District of Columbia. I had from the beginning declared my opposition to any interference with slavery in the District, but the changed condition of the country demanded a change of public policy in this respect. Slavery was made the pretext for, and, I believe, was, the real cause of the war. It had a foothold in the District of Columbia, but it existed there in its mildest form. By the census of 1860 there were, in the District of Columbia, 11,107 free negroes, 3,181 slaves, and 60,785 white people. It was considered the paradise of free negroes, where they were almost exclusively employed as laborers in household service.

When the war broke out a considerable number of slaves ran away from disloyal masters in Virginia and Maryland, seeking safety within our lines and finding employment in the District of Columbia. As the war approached, most of the slaves in the District were carried away by their owners into Virginia, and other southern states, so that in 1862 it was estimated there were not more than 1,500, and probably not 1,000, slaves in the District, while the number of free negroes increased to 15,000. As a matter of course, when Virginia seceded no attempt was made to recapture runaway slaves from that state, and they became practically free. It was known that there was at that time a strong disposition in Maryland to try the experiment of emancipation, and it was believed that after the war was over Virginia would adopt the same policy. Little doubt was felt as to the power of Congress to abolish slavery in the District, should such a course be deemed expedient. By the constitution Congress was invested with express "power to exercise exclusive legislation, in all cases whatsoever, over such district as may, by cession of particular states, and the acceptance of Congress, become the seat of government of the United States." This power had been recognized by the most eminent statesmen of our country, and also by the Supreme Court of the United States. Until Mr. Calhoun doubted or denied the power it was not questioned by any considerable number. The real question was whether that was the time for emancipation. I endeavored to give to the subject careful consideration, and came to the conclusion that it was expedient then to emancipate the very few slaves in the District, fewer than there had been at any time within forty years, and fewer than would likely be in case the war should end. I believed also that the social influence of Washington, and the wealth and property controlled and owned in a great measure by slaveholding residents there, had been always against the government of the United States and in favor of the Rebellion. While slavery existed it was a constant source of annoyance and irritation. The great mass of our constituents were opposed to slavery, morally, socially and politically. They felt it was wrong and would not change their opinion. As long as slavery existed in the District, where Congress had the power to abolish it, agitation and excitement would be ceaseless. The great body of the people of the northern states were opposed to the institution theoretically, as were very many of the most intelligent people of the southern states. I felt that now was the time when this moral conviction should be heard and heeded by the national legislature. I felt that we were bound to consult the material interest of the people of the District, and that emancipation would add to the value of their property and also add to the population of the city. The abolition of slavery would bring to the city intelligent mechanics and laboring men who would never compete with the labor of slaves, and who, finding none there but freemen, would develop the great advantages of the city. In a speech I made upon the subject I enlarged upon this consideration and said:

"I see no reason why Washington, with a free population and as a free city, situated here at the head of the Potomac, with remarkable facilities of navigation, with great conveniences of communication, reaching to the west by the Baltimore and Ohio Railroad, the political capital of the country, might not be a great free city, illustrating by its progress the operation of free institutions. But it can only be done by the active, interested labor of free people. Simply as a municipal regulation it would be wise to abolish slavery in this district, because slavery is opposed to the moral convictions of the great mass of the people of this country, and the existence of slavery here keeps out of this District an active, loyal, true, manly, generous body of laborers, who will never compete in their labor with the labor of slaves."

There was another reason why the experiment of emancipation could be best tried in the District of Columbia. Emancipation was evidently the ultimate end of this question. We had the power to try the experiment. It would be an example likely to be followed at the close of the war by many of the border states. I therefore made up my mind in favor of the measure, made a long speech for the bill and voted for it. It became a law on April 10, 1862.

At that early day, I believed that it was the duty of Congress to confiscate the slaves in the seceding states as the natural result of the war. These states had placed themselves in a position by rebellion where they had no constitutional rights which we were bound to observe. The war being open and flagrant to break up the Union, they were not entitled to the benefit of any stipulation made in their favor as states in the Union. I also favored the granting of aid to any policy of emancipation that might be adopted in the border states of Maryland, Kentucky and Missouri, but Congress was indisposed to extend the provisions of the then pending measure beyond the District of Columbia.

The President of the United States, on September 22, 1862, issued his proclamation containing the following declaration:

"That on the first day of January, in the year of our Lord one thousand eight hundred and sixty-three, all persons held as slaves within any state of designated part of a state, the people whereof shall be in rebellion against the United States, shall be then, thenceforward, and forever, free; and the executive government of the United States, including the military and naval authority thereof, will recognize and maintain the freedom of such persons, and will do no act or acts to repress such persons, or any of them, in any efforts they may make for their actual freedom."

This was carried out in a subsequent proclamation of January 1, 1863, in which the President declared:

"And by virtue of the power and for the purpose aforesaid, I do order and declare that all persons held as slaves, within said designated states and parts of states, are, and henceforward shall be, free; and that the executive government of the United States, including the military and naval authorities thereof, will recognize and maintain the freedom of said persons."

This was the beginning of the end of slavery.

In following the important financial measures of the 37th Congress, I have purposely passed by, in their order of time, other measures of vital interest that were acted upon in that Congress. The military measures adopted were on the same grand scale as the financial measures I have referred to. In 1861 the United States contained a population of 32,000,000 people, of whom about 10,000,000 were in the seceding states, some of whom were opposed to secession, but a greater number living in states that did not secede were in hearty sympathy with the rebellion. No preparation for war had been made in any of the loyal states, while in the disloyal states preparations had been made by the distribution of arms through the treachery of Secretary Floyd. When the seceding states organized a confederate government, the executive branch of the general government was under the management and control of those who favored the rebellion, or were so feeble or indifferent that they offered no resistance whatever to such organization. The President of the United States declared, in an executive message, that the general government had no power to coerce a state. On the accession of President Lincoln, the confederate government was better organized for resistance than the Union was for coercion. When war actually commenced, the capital at Washington was practically blockaded, and in the power of the Confederates.

The response of the loyal states to the call of Lincoln was perhaps the most remarkable uprising of a great people in the history of mankind. Within a few days the road to Washington was opened, but the men who answered the call were not soldiers, but citizens, badly armed, and without drill or discipline. The history of their rapid conversion into real soldiers, and of the measures adopted by Congress to organize, arm and equip them, does not fall within my province. The battles fought, the victories won, and the defeats suffered, have been recorded in the hundred or more volumes of "The Records of the Rebellion," published by the United States. The principal events of the war have been told in the history of Abraham Lincoln by Nicolay and Hay, and perhaps more graphically by General Grant, General Sherman, General Sheridan, Alexander H. Stephens, Fitz Hugh Lee, and many others who actively participated in the war, and told what they saw and knew of it.

The military committees of the two Houses, under the advice of accomplished officers, formulated the laws passed by Congress for the enlistment, equipment and organization of the Union armies. Henry Wilson, of Massachusetts, was chairman of the committee on military affairs of the Senate, and he is entitled to much of the praise due for the numerous laws required to fit the Union citizen soldiers for military duty. His position was a difficult one, but he filled it with hearty sympathy for the Union soldiers, and with a just regard for both officers and men.

Among the numerous bills relating to the war, that which became the act to suppress insurrection, to punish treason and rebellion, and to seize and confiscate the property of rebels, excited the greatest interest, giving rise to a long debate. It was founded on the faulty idea that a territorial war, existing between two distinct parts of the country, could be treated as an insurrection. The law of nations treats such a war as a contest between two separate powers, to be governed by the laws of war. Confiscation in such a war is not a measure to be applied to individuals in a revolting section, but if the revolt is subdued, the property of revolting citizens is subject to the will of the conqueror and to the law of conquest. The apparent object of the law referred to was to cripple the power of the Confederate States, by emancipating slaves held in them, whenever such states fell within the power of the federal army. This object was accomplished in a better and more comprehensive way by the proclamation of the President. The confiscation act had but little influence upon the result of the war, except that it gathered at the wake of our armies in the south a multitude of negroes called "contrabands," who willingly performed manual labor, but were often an incumbrance and had to be fed and protected.

The freedom of these "contrabands" was the result of the war, and not of the confiscation act. In the later period of the war, they, in common with the free negroes from the north, were organized into regiments commanded by white men, and rendered valuable service to the Union cause.

When the confiscation bill was pending, on the 23rd of April, 1862, I made a speech in support of an amendment offered by me and in substance adopted. A few extracts of my speech will show my opinions on this subject:

"Confiscation is not only justified by the laws of war, by the practice of many nations, but it is practiced by our enemies in the most obnoxious way. They seize all kinds of property of loyal citizens; they destroy contracts; confiscate debts. All the property of citizens of loyal states which is within a disloyal state is seized without exception, and that whether such citizen has aided the government or not. They also seize the property of all citizens in disloyal states who will not commit an act of treason by aiding them. Yet they profess to be governed by a constitution similar to the constitution of the United States, so far as it relates to the rights of person and property. They draw the distinction between the laws of war and the laws of peace. . . .

"Sir, it is time there was an end of this. We are at war. We must destroy our enemies or they will destroy us. We must subdue their armies and we must confiscate their property. The only question with me is as to the best measure of confiscation. That some one should be enacted, and that speedily, is not only my conviction of duty, but it will be demanded by those who will have to bear the burdens of the war. Now, it is the interest of every citizen in a seceding state to be a rebel. If a patriot, his property is destroyed. If a rebel, his property is protected alike by friend and foe. Now, the burdens of war will fall, by heavy taxation, upon loyal citizens, but rebels are beyond our reach. How long can we conduct such a war? Sir, we have been moderate to excess. War is a horrible remedy, but when we are compelled to resort to it, we should make our enemies feel its severity as well as ourselves. . . .

"If too much is attempted in the way of confiscation, nothing will be accomplished. If nothing is confiscated, you array against you all who wish in a civil war merely to preserve their property and to remain quiet. This is always a large class in every community. If rebellion will secure their property from rebels and not endanger it to the government, they are rebels. Those whose position or character have secured them offices among the rebels can only be conquered by force. Is it not, therefore, possible to frame a bill which will punish the prominent actors in the rebellion, proclaim amnesty to the great mass of citizens in the seceding states, and separate them from their leader? This, in my judgment, can be done by confining confiscation to classes of persons. The amendment I propose embraces five classes of persons."

The confiscation act was more useful as a declaration of policy than as an act to be enforced. It was denounced by the Confederates and by timid men in the north, but the beneficial results it aimed at were accomplished, not by law, but by the proclamation of the President and by the armed forces of the United States.

The several acts providing for enrolling and calling out the national forces gave rise to much debate, partly upon sectional lines. The policy of drafting from the militia of the several states, the employment of substitutes and the payment of bounties, were contested and defended. I insisted that if a special fund for hiring substitutes was raised, it ought to be by a tax upon all wealthy citizens, and not confined to the man who was drafted. These and numerous questions of a similar character occupied much time, and created much feeling. It is now hardly worth while, in view of the results of the war, to revive old controversies. It is sufficient to say that all the laws passed to organize the national forces and call out the militia of the several states in case of emergency contributed to the success of the Union armies. I do not recall any example in history where a peaceful nation, ignorant of military discipline, becoming divided into hostile sections, developed such military power, courage and endurance as did the United States and Confederate States in our Civil War. Vast armies were raised by voluntary enlistments, great battles were fought with fearful losses on both sides, and neither yielded until the Confederates had exhausted all their resources and surrendered to the Union armies without conditions, except such as were dictated by General Grant --to go home and be at peace.

During the entire war Washington was a military camp. Almost every regiment from the north on the way to the army in Virginia stopped for a time in Washington. This was especially the case in 1861. It was usual for every new regiment to march along Pennsylvania Avenue to the White House. Among the early arrivals in the spring of 1861 was a regiment from New Hampshire, much better equipped than our western regiments. My colleague, Ben Wade, and I went to the White House to see this noted regiment pass in review before Mr. Lincoln. As the head of the line turned around the north wing of the treasury department and came in sight, the eyes of Wade fell upon a tall soldier, wearing a gaudy uniform, a very high hat, and a still higher cockade. He carried a baton, which he swung right and left, up and down, with all the authority of a field marshal. Wade, much excited, asked me, pointing to the soldier: "Who is that?" I told him I thought that was the drum major. "Well," he said, "if the people could see him they would make him a general." So little was then known of military array by the wisest among our Senators.

It was quite a habit of Senators and Members, during the war, to call at the camps of soldiers from their respective states. Secretary Chase often did this and several times I accompanied him. The "boys," as they preferred to be called, would gather around their visitors, and very soon some one would cry out "a speech, a speech," and an address would usually be made. I heard very good speeches made in this way, and, in some cases, replied to by a private soldier in a manner fully as effective as that of the visitor.

In the early period of the war the private soldier did not forget that he was as good as any man. One evening Major, afterwards Major-General, Robert S. Granger and I were strolling through "Camp Buckingham," near Mansfield, Ohio, and came to a young soldier boiling beans. He was about to take them off the fire when Granger said: "My good fellow, don't take off those beans; they are not done." The young soldier squared himself and with some insolence said: "Do you think I don't know how to boil beans?" Granger, with great kindness of manner, said: "If you had eaten boiled beans in the army as many years as I have you would know it is better to leave them in the pot all night with a slow fire." The manner of Granger was so kindly that the soldier thanked him and followed his advice. General Granger died at Zanesville, Ohio, April 25, 1894, after having been on the retired list for over twenty-one years. He was a gallant, as well as a skillful, officer. Peace to his memory.

It was my habit, while Congress was in session during the war, to ride on horseback over a region within ten miles of Washington, generally accompanied by some army officer. I became familiar with every lane and road, and especially with camps and hospitals. At that time it could be truly said that Washington and its environs was a great camp and hospital. The roads were generally very muddy or exceedingly dusty. The great army teams cut up and blocked the roads which were either of clay or sand, but the air was generally refreshing and the scenery charming. I do not know of any city that has more beautiful environs, with the broad Potomac at the head of tide water, the picturesque hills and valleys, the woodland interspersed with deciduous and evergreen trees, the wide landscape, extending to the Blue Ridge on the west, the low lands and ridges of Maryland and the hills about Mt. Vernon. The city of Washington, however, was then far from attractive. It was an overgrown village, with wide unpaved avenues and streets, with 61,000 inhabitants badly housed, hotels and boarding houses badly kept, and all depending more or less upon low salaries, and employment by the government. All this has been changed. The streets and avenues have been paved and extended. The old site is now well filled with comfortable mansions and business blocks, and a large portion of the District outside the city is being occupied with villas and market gardens. The mode of living has greatly changed. Before and during the war, Senators and Members lived in boarding houses in messes, formed of families of similar tastes and opinions. Society, if it may be so called, was chiefly official, of which justices of the Supreme Court and cabinet officers were the head, and Senators and Members of Congress were the most numerous guests.

When I entered Congress my pay as a Member was $8 a day during the season, and it was said we had "roast beef;" but we paid for it if we had it. At the close of the 34th Congress the compensation was increased to $3,000 a year. During the latter part of the war and afterwards, prices of food, board and lodging were considerably advanced.

In 1864 I offered the proprietor of Willard's Hotel my monthly pay of $250 for board and lodgings, in very modest quarters, for my wife and myself, but he demanded $300 a month. This led me to purchase a house in which to live, a change which I have never regretted. It was quite the fashion then for the old families, who were in full sympathy with the Confederates, to underrate property (even their own) in Washington, on the ground that when the Confederacy was acknowledged the capital would be removed, and real estate could, therefore, be obtained upon very reasonable terms.

After the war the feverish revival of business growing out of our expanded currency led to such reckless extravagance in improvements by public officials in Washington that for a time it threatened the bankruptcy of the city, but, as this leads me in advance of events, I will recur hereafter to the Washington of to-day.

During 1870 Congress passed a law increasing the compensation of Senators and Members from $3,000 to $5,000 a year, and justified this increase by the inflated prices of everything measured by a depreciated currency. There would have been but little complaint of this by the people had not the law been made retroactive. It was made to take effect at the beginning of that Congress, though when the law was passed Congress was nearly ended. This "back pay," amounting to over $3,000, was very unpopular, and led to the defeat of many Members who voted for it. At home they were called "salary grabbers." Several Senators and Members, I among the number, declined to receive the back pay. But it was said that the Congressmen could apply for it at any time in the future when the excitement died away. This led me to write Francis E. Spinner, Treasurer of the United States, to ascertain how I could cover into the treasury my back pay. His answer was characteristic, and is here inserted. Spinner, long since dead, was a peculiar character. He was with me in the House of Representatives, was appointed Treasurer of the United States by President Lincoln, and continued as such until 1875. He was a typical officer, bold, firm and honest. He was also a true friend, a model of fidelity and courage.

"Treasury of the United States,} "Washington, July 3, 1873. } "My Dear Sir:--Your letter of the 28th ultimo has been received.

"I sympathize with you most fully. I too have had my share of lies told on me, by Dana and his 'Sun,' and shall be disappointed if the libels are not continued, especially if I do right. Really you have a white elephant on your hands. You can neither take the back pay, nor leave it where it is, nor draw it and redeposit it, without subjecting yourself to the yelping of the damned curs, that bark at the heels of every honest man.

"If you will turn to the proviso in Section 5, of the General Appropriation Bill, approved July 12, 1870, at page 251, volume 16, of the Statutes at Large, you will, I think, be satisfied that your back pay would never lapse to the treasury. Should you leave it, as it now is, I think it would at all times be subject to your order, and to the order of your heirs afterwards. The department has decided that the appropriations for the pay of Members of Congress is permanent. The papers say that the Comptroller has decided that the back pay would lapse in two years. I called on him to-day, and he furnished me with a copy of his opinion, which is herewith inclosed you, and wrote me a note, a copy of which is also inclosed, in which he says--'it could not be carried back until after two years; whether it can be carried back is another question, which I do not intend to decide.' There are two ways that the amount can be carried back into the treasury: First, by drawing out the amount, and redepositing it; and second, by directing the secretary of the senate, by written order, to turn the amount into the treasury. I, of course, can't advise you what to do.

"Very respectfully yours, "F. E. Spinner, Tr., U. S. "Hon. John Sherman, Mansfield, Ohio."

In the spring of 1863, the financial operations of the government were eminently successful. In the fall of 1862, Secretary Chase endeavored to sell the $500,000,000 5-20 six per cent. bonds, authorized by the act of February 25, 1862, through experienced officers in New York, and could not get par for them. He then employed Jay Cooke, of Philadelphia, to take charge of this loan, and within a year it was sold by him, to parties all over the country, at par. The entire cost of placing the loan was less than three-eighths of one per cent. It furnished the greater part of the means necessary to conduct the war during 1863.

The early victories of Grant and Forts Henry and Donelson had rescued Kentucky, and opened up the Cumberland and Tennessee Rivers to the heart of the south. The battle of Shiloh, though won at a great sacrifice, inspired the western army with confidence, and gave General Sherman his first opportunity to prove his ability as a soldier. The timid handling of that army by Halleck and its subsequent dispersion by his orders, and the general operations of both the armies in the west and in Virginia, created a feeling of despondency in the loyal states which was manifested in the election in the fall of 1862. The military operations in the early part of 1863 did not tend to restore confidence.

At this period I received the following letter from Secretary Stanton, which evidenced his appreciation of General Sherman:

"Washington, D. C., December 7, 1862. "Hon. John Sherman.

"Dear Sir:--The general's letter is returned herewith, having been read with much interest and great admiration of his wisdom and patriotism. If our armies were commanded by such generals we could not fail to have a speedy restoration of the authority of the government, and an end of the war.

"I beg you to give him my warmest regards, and no effort of mine will be spared to secure to the government the fullest exercise of his abilities. With thanks for the favor, I am,

"Yours truly, "Edwin M. Stanton."

The attack by General Sherman upon the defenses of Vicksburg had been repulsed, but the effect of this had been counteracted by the capture of Arkansas post with over 5,000 prisoners. General Grant had failed in his operations in Mississippi. General Hooker had been defeated at Chancellorsville, and Lee was preparing to make an advance into Maryland and Pennsylvania.

On May 1, 1863, Clement L. Vallandigham, for several years a Member of Congress from Ohio, in a speech made at Mount Vernon, denounced the government with great violence, and, especially, an order issued by General Ambrose E. Burnside, commanding the department of the Ohio, announcing that "all persons, found within our lines, who commit acts for the benefit of the enemies of our country, will be tried as spies or traitors, and if convicted will suffer death." Burnside enumerated among the things which came within his order, the writing or carrying of secret letters, passing the lines for treasonable purposes, recruiting for the Confederate service. He said: "The habit of declaring sympathy for the enemy will not be allowed in this department; persons committing such offenses will be at once arrested, with a view to being tried or sent beyond our lines into the lines of their friends."

Vallandigham denounced this order as a base usurpation of arbitrary power; said that he despised it, and spat upon it, and trampled it under his foot. He denounced the President, and advised the people to come up together at the ballot box and hurl the tyrant from his throne. Many of his hearers wore the distinctive badges of "copperheads" and "butternuts," and, amid cheers which Vallandigham's speech elicited, was heard a shout that Jeff. Davis was a gentleman, which was more than Lincoln was.

This speech was reported to General Burnside. Early on the 4th of May a company of soldiers was sent to arrest Vallandigham, and the arrest was made. Arriving at Cincinnati, he was consigned to the military prison and kept in close confinement. This event caused great excitement, not only in Cincinnati, but throughout the State of Ohio. On the evening of that day a great crowd assembled at Dayton, and several hundred men moved, hooting and yelling, to the office of the Republican newspaper, and sacked and then destroyed it by fire. Vallandigham was tried by a military commission, which promptly sentenced him to be placed in close confinement in some fortress of the United States, to be designated by the commanding officer of the department, there to be kept during the continuance of the war. Such an order was made by General Burnside, but it was subsequently modified by Mr. Lincoln, who commuted the sentence of Vallandigham, and directed that he be sent within the Confederate lines. This was done within a fortnight after the court-martial. Vallandigham was sent to Tennessee, and, on the 25th of May, was escorted by a small cavalry force to the Confederate lines near Murfreesboro, and delivered to an Alabama regiment.

Vallandigham made a formal protest that he was within the Confederate lines by force, and against his will, and that he surrendered as a prisoner of war. His arrest for words spoken, and not for acts done, created great excitement throughout Ohio and the country. A public meeting was held in New York on May 16, which denounced this action as illegal--as a step towards revolution. The Democratic leaders of Ohio assumed the same attitude, and made a vigorous protest to the President. It is not necessary to state this incident more fully. Nicolay and Hay, in their history of Lincoln, narrate fully the incidents connected with this arrest, and the disposition of Vallandigham. The letters of the President in reply to Governor Seymour, and to the meeting in Ohio, are among the most interesting productions of Mr. Lincoln. He doubted the legality of the arrest. He quoted the provision of the constitution that the privilege of the writ of habeas corpus "should not be suspended unless, in cases of invasion or rebellion, the public safety may require it." He had suspended the privileges of that writ upon the happening of contingencies stated in the constitution and, therefore, the commanding officer was justified in making the arrest, and he did not deem it proper to interfere with the order of the commanding officer.

This incident was made more important when, on the 11th of June, the Democratic convention of the State of Ohio met at Columbus and there formally nominated Vallandigham as the candidate of that party for Governor of Ohio. This presented directly to the people of that state the question of the legality and propriety of the arrest of Vallandigham. The Republican party subsequently met and nominated for governor John Brough, a lifelong Democrat, but in through sympathy with the Union cause.

It is difficult, now, to describe the intense excitement in Ohio over the issue thus made--at times breaking into violence. Vallandigham was received with great favor in the different cities of the south, and finally, embarking on board of a vessel which ran the blockade at Wilmington, he arrived at Bermuda on the 22nd of June, from which place he took passage to Canada, arriving at Niagara Falls about the middle of July.

The feeling of anger and excitement among the loyal people of Ohio increased, so that it was manifest that if Vallandigham entered the state he would be in great danger, and a quasi civil war might have arisen. I heard men of character and influence say distinctly that if Vallandigham came into the state he would be killed, and they, if necessary, would kill him. It was then understood that Mr. Lincoln was disposed to allow him to enter the state. Senator Wade and I met at Washington and had a conversation with Mr. Lincoln. We told him the condition of feeling in Ohio, and of our confident belief that if his order of banishment was revoked, it would result in riots and violence, in which Vallandigham would be the first victim. He gave us no positive assurance, but turned the conversation by saying that he thought Vallandigham was safer under British dominion, where he would have plenty of friends.

In June, 1863, my health was somewhat impaired, and Mrs. Sherman and I concluded to visit New England for a change of scene, and for the benefit of the ocean air. We visited Newport in advance of the season and found it deserted. We went to Boston, and there heard of the advance of Lee in Pennsylvania, and the fierce contest going on in the rear of Vicksburg. I became uneasy and started for home with the intention of proceeding to Vicksburg, but at Cleveland we heard the glad tidings of great joy, the fall of Vicksburg and the defeat of Lee at Gettysburg.

These victories, occurring on the same day, aroused the enthusiasm and confidence of the loyal people of the United States, especially the people of Ohio. Instead of a trip to Vicksburg I was soon enlisted in the political canvass, and this for three months occupied my attention. Meetings were held in every county and in almost every township of the state. All on either side who were accustomed to speak were actively engaged. My opening speech was made at Delaware on the 29th of July. I was intensely interested in the canvass, and therefore insert a few paragraphs from that speech, as an indication of the state of feeling existing at that time:

"The political campaign in Ohio this season presents some singular features. We are in the midst of a great civil war, in which it is safe to say that one million of men are now arrayed in arms against each other. There are, perhaps, now, from Ohio, one hundred thousand of her best and bravest citizens in the field, in hospitals or camps, sharing the burdens of war. The immediate stake involved is nothing less than national existence; while the ultimate stake involves nothing less than civil liberty for generations yet to come. In the midst of this contest the Democratic party, through its most eloquent orators, endeavor to make a personal issue. They propose to withdraw our armies, to abandon the war, and to try the question whether their candidate for governor has been legally convicted as a traitor to his country.

"We are assured by Mr. Pugh, the Democratic candidate for lieutenant governor, who is one of the most eloquent and able young men in the state, that here in Ohio we have been subjected to a tyranny as intolerable as that of King Bomba of Naples. When we ask for evidence of this tyranny, we are told that Clement L. Vallandigham has been illegally convicted and illegally banished; and that if we are fit to be free we must stop and examine the record in his case, and not be turned from it by clamors about prosecuting the war, or of concluding peace. And we are told that if we don't do all this we are helpless slaves and deserve no better fate. Now, as I do not desire to be a slave, and do not wish the people of my native state to be slaves, I will so far depart from my usual course in political discussion as to examine the personal issue thus made.

"I had supposed, fellow-citizens, that nowhere in the wide world did people live as free from oppression as in the State of Ohio. But the Democratic party has sounded the alarm that our liberties were jeopardized in that Mr. Vallandigham has been, as they assert, illegally convicted and banished. Before alluding to matters of more general interest I propose to consider that question.

"The candidate of the Democratic party was convicted by a military tribunal for aiding the enemy with whom we are at war. For this he was expelled beyond our lines, and was within the lines of the enemy when nominated for governor of Ohio. By the judgment of a military tribunal, composed mainly of his political friends, approved by General Burnside, the chief military officer within the state, sanctioned by Judge Leavitt--a judge selected by Vallandigham himself--of the United States court, he was convicted and sentenced to imprisonment during the war. By the mercy of the President he was released from imprisonment and sent beyond our lines. While thus banished as a convicted traitor, by military authority, the Democratic party of the State of Ohio nominated this man as a candidate for governor, and you are called upon to ratify and confirm that nomination, to intrust this man, convicted as a traitor, with the chief command of our militia, the appointment of all its officers, and the management of the executive authority of the state; and that, too, in the midst of a war with the rebels he was convicted of aiding. . . .

"And here is the marked distinction between the two parties. The Union party strikes only at the rebels. The Democratic party strikes only at the administration. The Union party insists upon the use of every means to put down the rebels. The Democratic party uses every means to put down the administration. I read what is called the Democratic Platform, and I find nothing against the rebels who are in arms against the best government in the world; but I find numerous accusations against the authorities of the government, who are struggling to put down the rebels. I find no kindly mention of the progress of our arms, no mention of victories achieved and difficulties overcome; no mention of financial measures without a parallel in their success; no promise of support, no word of encouragement to the constituted authorities; no allowance made for human error; not a single patriotic hope. It is a long string of whining, scolding accusations. It is dictated by the spirit of rebellion, and, before God, I believe it originated in the same malignant hate of the constituted authorities as has armed the public enemies. I appeal to you if that is the proper way to support your government in the time of war. Is this the example set by Webster and Clay, and the great leaders of the Whig party when General Jackson throttled nullification; or is it the example of the tories of the Revolution?"

Brough visited, I think, every county in the state. Everywhere his meetings were large and enthusiastic, but it must be said also that the Democratic meetings, which were equally numerous, were very largely attended. The people were evidently anxious to hear both sides.

Towards the close of the campaign I accompanied Mr. Brough through the populous central counties of the state. We spoke, among other places, in Newark, Zanesville and Lancaster. The meetings were not merely mass meetings, but they were so large that no human voice could reach all those present, and speeches were made from several stands in the open air, each surrounded by as many as could hear. This indication of public feeling was somewhat weakened by the fact that the Democratic meetings were also very large, and the ablest members of that party were actively engaged in the canvass. The "martyr" in Canada was the hero of these meetings, and his compulsory arrest and absence from the state, but near its border, was the constant theme of complaint. It was observed that the rival meetings were attended by men of both parties in nearly equal numbers, so that it was difficult to form an opinion of the result. Mr. Brough kept a memorandum book containing the names of the counties in the state and the estimated majorities for or against him in each county. At night, when the crowds dispersed, he would take out his book, and, upon the information received that day, would change the estimate of his majorities. In view of the enormous attendance at, and interest in, the Democratic meetings, he was constantly lowering his estimated majority on the home vote, until finally it declined to 5,000, with the army vote known to be very largely in his favor. At Lancaster, where he had lived and published a strong Democratic paper for many years, and where I was born, he carefully analyzed his list, and, throwing his book upon the table, emphatically said that he would not reduce his majority of the home vote one vote below 5,000. The Democratic party, however, seemed confident of Vallandigham's election. The result was that Brough was elected by the unprecedented majority of 101,000, of which 62,000 was on the home vote and 39,000 on the vote of the soldiers in the field, they having the privilege of voting.

This settled once for all the position of Ohio, not only on the question of the war, but on the determination of its people to support Mr. Lincoln in the use of all the powers granted by the constitution as construed by him, and to prosecute the war to final success. Vallandigham remained in Canada until June, 1864, when he returned quietly to Ohio, where he was permitted to remain. His presence injured his party. His appearance in the national convention at Chicago in 1864, and active participation in its proceedings, and his support of General McClellan, greatly, I think, diminished the chances of the Democratic ticket. He died seven years later by an accidental wound inflicted by himself.

I have always regarded Brough's election in Ohio upon the issue distinctly made, not only as to the prosecution of the war, but in support of the most vigorous measures to conduct it, as having an important influence in favor of the Union cause equal to that of any battle of the war. The results of all the elections in the several states in 1863 were decidedly victories for the Union cause, and especially in New York, Pennsylvania, Ohio and Maryland.

CHAPTER XV. A MEMORABLE SESSION OF CONGRESS. Dark Period of the War--Effect of the President's Proclamation-- Revenue Bill Enacted Increasing Internal Taxes and Adding Many New Objects of Taxation--Additional Bonds Issued--General Prosperity in the North Following the Passage of New Financial Measures--Aid for the Union Pacific Railroad Company--Land Grants to the Northern Pacific--13th Amendment to the Constitution--Resignation of Secretary Chase--Anecdote of Governor Tod of Ohio--Nomination of William P. Fessenden to Succeed Chase--The Latter Made Chief Justice--Lincoln's Second Nomination--Effect of Vallandigham's Resolution--General Sherman's March to the Sea--Second Session of the 38th Congress.

The 38th Congress met on the 7th of December, 1863. The Members of the House of Representatives were elected in the fall of 1862, perhaps the darkest period of the war for the Union cause. The utter failure of McClellan's campaign in Virginia, the defeat of Pope at the second battle of Bull Run, the jealousies then developed among the chief officers of the Union army, the restoration of McClellan to his command, the golden opportunity lost by him at Antietam, the second removal of McClellan from command, the slow movement of Halleck on Corinth, the escape of Beauregard, the scattering of Halleck's magnificent army, the practical exclusion of Grant and his command, and the chasing of Bragg and Buell through Kentucky--these, and other discouraging events, created a doubt in the public mind whether the Union could be restored. It became known during the happening of these events that Mr. Lincoln had determined upon the emancipation of slaves in states in rebellion by an executive act. He said to the artist, F. B. Carpenter:

"It had got to be midsummer, 1862; things had gone on from bad to worse, until I felt that we had reached the end of our rope on the plan of operations we had been pursuing; that we had about played our last card, and must change our tactics, or lose the game. I now determined upon the adoption of the emancipation policy; and without consultation with, or the knowledge of, the cabinet, I prepared the original draft of the proclamation."

Of the cabinet, Blair deprecated this policy on the ground that it would cost the administration in the fall elections. Chase doubted the success of the measure and suggested another plan of emancipation, but said that he regarded this as so much better than inaction on the subject that he would give it his entire support. Seward questioned the expediency of the issue of the proclamation at that juncture. The depression of the public mind consequent upon repeated reverses was so great that he feared the effect of so important a step.

In consequence of the opposition, the proclamation was postponed. On the 22nd of September, the President, having fully made up his mind, announced to the cabinet his purpose to issue the proclamation already quoted. What he did, he said, was after full deliberation and under a heavy and solemn sense of responsibility.

The effect of this proclamation upon the pending elections in Ohio was very injurious. I was then actively engaged in the canvass and noticed that when I expressed my approbation of the proclamation, it was met with coldness and silence. This was especially so at Zanesville. The result was the election in Ohio of a majority of Democratic Members of Congress. This, following the overwhelming Republican victory in 1861, when Tod was elected governor by a majority of 55,203, was a revolution which could only be ascribed to the events of the war and to the issue of the proclamation. It may be also partially ascribed to the discontent growing out of the appointments, by Governor Tod, of officers in the volunteers. The same discontent defeated the renomination of Governor Dennison in 1861. Such is the usual result of the power of appointment, however prudently exercised.

The House of Representatives was promptly organized on the 7th of December, 1863, by the election of Schuyler Colfax as speaker. The session of Congress that followed was perhaps the busiest and most important one in the history of our government. The number of measures to be considered, the gravity of the subject-matter, and the condition of the country, demanded and received the most careful attention. The acts relating to the organization of the army and the one increasing the pay of soldiers, made imperative by the depreciation of our currency, as well as the draft and conscription laws, received prompt attention. The enrollment act, approved February 24, 1864, proved to be the most effective measure to increase and strengthen the army. The bounty laws were continued and the amount to be paid enlarged. The laws relating to loans, currency, customs duties and internal taxes required more time and occupied a great portion of the session. The revenue bill enacted at that session was far more comprehensive and the rates much higher than in any previous or subsequent law. It provided for an increase of all internal taxes contained in previous laws, and added many new objects of taxation, so as to embrace nearly every source of revenue provided for by American or English laws, including stamp duties upon deeds, conveyances, legal documents of all kinds, certificates, receipts, medicines and preparations of perfumery, cosmetics, photographs, matches, cards, and indeed every instrument or article to which a stamp could be attached. It also provided for taxes on the succession to real estate, legacies, distributive shares of personal property, and a tax of from five to ten per cent. on all incomes above $600, upon all employments, upon all carriages, yachts, upon slaughtered cattle, swine and sheep, upon express companies, insurance companies, telegraph companies, theaters, operas, circuses, museums and lotteries, upon all banks and bankers, brokers, and upon almost every article of domestic production. It placed a heavy tax upon licenses, upon dealers in spirits, upon brokers, lottery-ticket dealers and almost every employment of life.

It largely increased the tax on spirits, ale, beer, porter, and tobacco in every form. Not content with this, on the last day of the session, Congress levied a special income tax of five per cent., to provide for the bounties promised to Union soldiers. This drastic bill occupied the attention of both Houses during a considerable portion of the session, and became a law only on the 30th of June, 1864, within four days of the close of the session. It was greatly feared that the law could create discontent, but it was received with favor by the people, few if any complaints being made of the heavy burden it imposed. The customs duties were carefully revised, not in the interest of protection but solely for revenue. Nearly all the articles formerly on the free list were made dutiable, and they proved to be copious sources of revenue, especially the duties on tea, coffee, spirits of all kinds, wines, cigars, and tobacco in every form.

During that session Congress passed two important loan bills, which practically confided to the Secretary of the Treasury the power to borrow money in almost any form that could be devised. The first act, approved March 3, 1864, authorized him to borrow, on the credit of the United States, $200,000,000 during the current fiscal year, redeemable after any period not less than five years, and payable at any period not more than forty years from date, in coin, and bearing interest at six per cent. per annum. It also provided for the issue of $11,000,000 5-20 bonds which had been sold in excess of the $500,000,000 authorized by law. By the act approved June 30, 1864, the Secretary of the Treasury was authorized to borrow, on the credit of the United States, $400,000,000, on bonds redeemable at the pleasure of the United States after a period of not less than five, nor more than forty, years from date, bearing an annual interest of not exceeding six per cent., payable semi-annually in coin. He was authorized to receive for such bonds lawful money of the United States, or, at his discretion, treasury notes, certificates of indebtedness or certificates of deposit, issued under any act of Congress. These bonds were similar in general description to the 5-20 bonds already provided for, but bore interest at five per cent. instead of six.

By these measures the people of the United States had placed in the power of the government almost unlimited sources of revenue, and all necessary expedients for borrowing. Strange as it may appear, under the operation of these laws the country was very prosperous. All forms of industry hitherto conducted, and many others, were in healthy operation. Labor was in great demand and fully occupied. This will account for the passage of several laws that would not be justified except in an emergency like the one then existing. Among these was an act to encourage immigration, approved July 4, 1864. This act grew out of the great demand for labor caused by the absence of so many men in the army. A commission of immigration was provided. Immigrants were authorized to pledge their wages, for a term not exceeding twelve months, to repay the expense of their immigration. These contracts were declared to be valid in law and might be enforced in the courts of the United States or of the several states and territories. It provided that no immigrant should be compulsorily enrolled for military service during the existing insurrection, unless such immigrant voluntarily renounced, under oath, his allegiance to the country of his birth, and declared his intention to become a citizen of the United States. This law could only be justified by the condition of affairs then existing.

Another law, alike indefensible, but considered important at the time, regulating the sale of gold, was approved June 17, 1864. It declared unlawful a contract for the purchase or sale and delivery of any gold coin or bullion, to be delivered on any day subsequent to the making of the contract. It also forbade the purchase or sale and delivery of foreign exchange, to be delivered at any time beyond ten days subsequent to the making of such contract, or the making of any contract for the sale and delivery of any gold coin or bullion, of which the person making such contract was not at the time of making it in actual possession. It also declared it to be unlawful to make any loans of money or currency to be repaid in coin or bullion or to make any loan of coin or bullion to be repaid in currency. All these provisions were made to prevent what were regarded as bets on the price of gold. This law, however, proved to be ineffective, as all such laws interfering with trade and speculation must be, and was soon repealed.

The national banking act, which passed at the previous session, was carefully revised and enacted in a new form, and it still remains in force, substantially unchanged by subsequent laws. By this new act the office of comptroller of the currency was created. Under its provisions, aided by a heavy tax on the circulating notes of state banks, such banks were converted into national banks upon such conditions as secured the payment of their circulating notes.

The financial measures, to which I have referred, were the work of the committees of ways and means of the House and on finance in the Senate. They occupied the chief attention of both Houses, and may fairly be claimed by the members of those committees as successful measures of the highest importance. I was deeply interested in all of them, took a very active part in their preparation in committee, and their conduct in the Senate, and, with the other members of the committee, feel that the measures adopted contributed largely to the final triumph of the Union cause. Certainly, the full power of the United States, its credit and the property of its people were by these laws intrusted to the executive authorities to suppress the rebellion.

In addition to military and financial measures, that session was prolific in many other measures of primary importance. The Union Pacific Railroad Company, which had been chartered by the previous Congress, found itself unable to proceed, and appealed to Congress for additional aid. This was granted by the act of July 2, 1864. Under this act, the first lien of the United States for bonds advanced to the company, provided for by the act of 1862, was made subordinate to the lien of the bonds of the company sold in the market--a fatal error, which led to all the serious complications which followed. The proceeds of the sale of the first mortgage bonds of the company, with a portion of those issued by the United States in aid of the company, built both the Union and Central Pacific, so that the constructors of those roads, who were mainly directors and managers of the company, practically received as profit a large portion of the bonds of the United States issued in aid of the work, and almost the entire capital stock of the company. If the act had been delayed until after the war, when the securities of the United States rapidly advanced in value, it could not have passed in the form it did. The construction of the road was practically not commenced until the war was over. The constructors had the benefit of the advancing value of the bonds and of the increasing purchasing power of United States notes.

It was unfortunate that the bill for the construction of the Northern Pacific Railroad came up at the same time. It was a faulty measure, making excessive grants of public lands to aid in the construction of a railroad and telegraph line from Lake Superior to Puget Sound. It was an act of incorporation with broad and general powers, carelessly defined, and with scarcely any safeguards to protect the government and its lavish grants of land. Some few amendments were made, but mostly in the interest of the corporation, and the bill finally passed the Senate without any vote by yeas and nays.

These two bills prove that it is not wise during war to provide measures for a time of peace.

During the same session the Territories of Colorado, Nebraska and Nevada were authorized to form state governments for admission into the Union, and a government was provided for each of the Territories of Montana and Idaho. The great object of organizing all the Indian country of the west into states and territories was to secure the country from Indian raids and depredations.

By far the most beneficial action of Congress at this session was the passage of the 13th article of the constitution of the United States, viz., "Neither slavery nor involuntary servitude, except as a punishment for crime, whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction."

It was thoroughly debated, and passed the Senate by the large vote of 38 yeas and 6 nays. It subsequently received the sanction of the House and of the requisite number of states to make it a part of the constitution. This was the natural and logical result of the Civil War. In case the rebellion should fail, it put at an end all propositions for compensation for slaves in loyal states, and all question of the validity of the emancipation proclamation of Abraham Lincoln.

The following letter of Secretary Chase shows the extremity of the measures deemed to be necessary at this period of the war:

"Treasury Department, May 26, 1864. "My Dear Sir:--I inclose two drafts of a national bank taxation clause--one marked 'A,' providing for the appropriation of the whole tax to the payment of interest or principal of the public debt and repealing the real estate direct tax law, and another marked 'B,' dividing the proceeds of the tax between the national and the loyal states. In either form the clause will be vastly more beneficial to the country than in the form of the bill, whether original or amended.

"I also inclose a draft of a section providing for a tax on banks not national in the internal revenue act. It substantially restates the House proposition limiting it to banks of the states. Some discrimination in favor of the national system which affords substantial support to the government as compared with the local system, which circulates notes in competition with those issued by the government, seems to me indispensably necessary. It is impossible to prevent the depreciation of the currency unless Congress will assume its constitutional function and control it; and it is idle to try to make loans unless Congress will give the necessary support to the public credit. I am now compelled to advertise for a loan of fifty millions, and, to avoid as far as practicable the evils of sales below par, must offer the long bonds of '81. Should the provisions I ask for be denied, I may still be able to negotiate the loan on pretty fair terms; but I dread the effects on future loans.

"Hitherto I have been able to maintain the public credit at the best points possible with a surcharged circulation. My ability to do so is due mainly to the legislation of the session of 1862-63. I must have further legislation in the same direction if it is desired to maintain that ability.

"Yours truly, "S. P. Chase. "Hon. John Sherman."

A few days before the close of the session, on the 29th of June, 1864, Mr. Chase tendered his resignation as Secretary of the Treasury. This created quite a sensation in political circles. It was thought to be the culmination of the feeling created by the nomination of Lincoln and the alleged rivalry of Chase, but the statements made in the "History of Lincoln," by Nicolay and Hay, and the "Biography of Chase," by Schuckers, clearly show that the cause of the resignation arose long anterior to this event and gradually produced a condition of affairs when either Mr. Lincoln had to yield his power over appointments or Mr. Chase retire from his office. No good would result from analyzing the events which led to this resignation. The cause was perhaps best stated by Mr. Lincoln in accepting it, as follows:

"Your resignation of the office of Secretary of the Treasury, sent me yesterday, is accepted. Of all I have said in commendation of your ability and fidelity I have nothing to unsay, and yet you and I have reached a point of mutual embarrassment in our official relation which it seems cannot be overcome or longer sustained consistently with the public service."

The nomination of David Tod, of Ohio, as Secretary of the Treasury to succeed Mr. Chase, was not well received in either House. If the Members had known Tod as well as I did, they would have known that he was not only a good story teller, but a sound, able, conservative business man, fully competent to deal with the great office for which he was nominated. His declination, however, prevented a controversy which would have been injurious, whatever might have been the result. An anecdote frequently told by him may, perhaps, explain his nomination.

When he was elected Governor of Ohio, he went to Washington to see Mr. Lincoln, to find out, as he said, what a Republican President wanted a Democratic Governor of Ohio to do in aid of the Union cause. He called at the White house, sent in his card, and was informed that the President was engaged, but desired very much to see Governor Tod, and invited him to call that evening at 7 o'clock. Promptly on time Governor Tod called and was ushered into the room where, for the first time, he saw Mr. Lincoln. Mutual salutation had scarcely been exchanged before the announcement was made that David K. Cartter was at the door. Mr. Lincoln asked the governor if he had any objection to Cartter hearing their talk. The governor said no, that Cartter was an old friend and law partner of his. Soon after Governor Nye of Nevada was announced. The same inquiry was made and answered, and Nye joined the party, and in the same way Sam. Galloway, of Ohio, and a famous joker from New York, whose name I do not recall, came in. Then grouped around the table, Nye led off with a humorous description of life in the mines in the early days of California, and the others contributed anecdotes, humor and fun, in which Lincoln took the lead, "and I" (as Tod told the story), "not to be behindhand, told a story;" and so the hours flew on without any mention of the grave matters he expected to discuss with the President. When the clock announced the hour of eleven, Mr. Lincoln said he made it a habit to retire at eleven o'clock, and, turning to Tod, said: "Well, Governor, we have not had any chance to talk about the war, but we have had a good time anyway; come and see me again." It then dawned upon the governor that this little party of kindred spirits, all friends of his, were invited by the President to relive him from an interview about the future that would be fruitless of results. Neither could know what each ought to do until events pointed out a duty to be done. Lincoln knew that Tod was a famous story teller, as were all the others in the party, and availed himself of the opportunity to relieve his mind from anxious care.

Governor Tod told me this anecdote and related many of the stories told at that symposium.

The nomination of William P. Fessenden as Secretary of the Treasury was a natural one to be made, and received the cordial support of Members of the Senate, even of those who did not like his occasional ill temper and bitterness. And here I may properly pause to notice the traits of two men with whom I was closely identified in public life, and for whom I had the highest personal regard, although they widely differed from each other.

Mr. Fessenden was an able lawyer, a keen incisive speaker, rarely attempting rhetoric, but always a master in clear, distinct statement and logical argument. He had been for a number of years dyspeptic, and this, no doubt, clouded his temper and caused many of the bitter things he said. When I entered the Senate, I was, at his request, placed on the committee on finance, of which he was chairman. He was kind enough to refer to my position in the House as chairman of the committee of ways and means, and my action there, and to express the hope that I would be able to aid him in dealing with financial question, in which he had no training and but little interest. I accepted the position with pleasure, and in general co-operated with him, though on many important subjects we widely differed. His appointment as Secretary of the Treasury left me chairman of the committee on finance, but my intercourse with him continued while he was secretary. During the short period in which he held that office, I had many conferences with him in respect to pending questions. When he returned to the Senate, on the 4th of March, 1865, he resumed his old place as chairman of the committee on finance, and continued in that position nearly two years, when, his health becoming more feeble, he resigned his membership of that committee, and I again took his place as chairman and held it until appointed Secretary of the Treasury in 1877. His health continued to fail and he died at Portland, Maine, September 8, 1869.

With Mr. Chase I had but little acquaintance and no sympathy during his early political career. His edition of the "Statutes of Ohio" was his first work of any importance. He was at times supposed to be a Whig and then again classed as a Democrat. Later he became a member of the national convention of Free Soilers held at Buffalo, August 9, 1848, over which he presided. This convention was composed of delegates from eighteen states, and included in its active members many of the most eminent Whigs and Democrats of a former time. It nominated Martin Van Buren for the Presidency, and Charles Francis Adams for Vice President. General Taylor, the nominee of the Whig party, was elected President, but Mr. Van Buren received 291,342 votes, being nearly one-eighth of the whole number of votes cast.

It so happened that when the Ohio legislature met in December, 1848, it was composed of an equal number of Whigs and Democrats and of two members, Townsend and Morse, who classed themselves as Free Soilers. They practically dictated the election of Mr. Chase as United States Senator. They secured his election by an understanding, express or implied, with the Democratic members, that they would vote for Democrats for all the numerous offices, which, under the constitution of the state as it then stood, were appointed by the legislature. This bargain and sale--so-called-- created among the Whigs a strong prejudice against Chase. But events in Congress, especially the act repealing the Missouri Compromise, practically dissolved existing parties, and left Mr. Chase in the vantage ground of having resisted this measure with firmness. He was universally regarded as a man of marked ability and honest in his convictions. In the election for Members of Congress in 1854, he supported what were known as the anti-Nebraska candidates, and, no doubt, contributed to their election. When he was nominated for governor, I was naturally brought into friendly relations with him, and these, as time advanced, were cordial and intimate. Our correspondence was frequent, mostly of a personal character, and our intimacy continued while he lived. When he was Secretary of the Treasury I was frequently consulted by him, and had, as I believe, his entire confidence. I have a great number of letters from him written during that period.

In September, 1864, Mr. Chase was my guest at Mansfield for a day or two. He was evidently restless and uneasy as to his future. I spoke to him about the position of chief justice, recently made vacant by the death of Taney. He said it was a position of eminence that ought to satisfy the ambition of anyone, but for which few men were fitted. Early in October I received a letter from him which shows he was actively engaged in the canvass, and that the common belief that he did not desire the election of Mr. Lincoln was without foundation. He wrote as follows:

"Louisville, October 2, 1864. "My Dear Sir:--Some days since I informed the secretary of the state central committee that I would, as far as possible, fill the appointments which ill-health had obliged Gov. Tod to decline. Seeing afterwards, however, that he had determined to meet them himself, I acceded to requests from other quarters to given them what help I could. The first intimation I had that he would fail in any of them was your letter, put into my hands just as I was leaving Cincinnati for New Albany last Friday. It was then too late to recall my own appointments, and, of course, I cannot be at Mansfield. I should be glad to be there; but regret the impossibility of it the less since I should not meet you. I am really glad you are going to Logansport. The election of Gov. Morton is of vast importance to our cause. And, then, Colfax, I feel most anxious for him. I hope you can go to his district. I wanted to go myself; but was urged to other parts of Indiana, and was left no chance to reach it till this week; which must be given to Ohio in aid of Stevenson and Bundy, except that I speak here to-morrow (Monday), and Tuesday night in Covington.

"There has been a very large accumulation of troops here, for Sherman. Col. Hammond telegraphed the department at Washington yesterday that, communications being now re-established from Nashville to Atlanta, he could commence sending them forward immediately; and doubtless the movement will begin tomorrow. I congratulate you most heartily of his splendid success thus far and on the certainty that no effort will be spared to maintain his army at the highest possible point of efficiency.

"There appears to be no truth in the report of a co-operative movement in aid of Sheridan for Tennessee. Burbridge's expedition is for a point beyond Abingdon where there are important salt works, and he intends returning thence through Knoxville. So I learn from one who ought to know; but don't understand it. That game seems hardly worth the candle.

"We had a splendid meeting in Aurora yesterday and our friends are confident of Gov. Morton's re-election. Thousands of people stood in a pouring rain to hear me and Gov. Lane talk to them, and profounder or more earnest attention I never witnessed. It will gratify you, I am sure, to know that I receive, wherever I go, unequivocal manifestations of a popular confidence and appreciation, which I did not suppose I possessed.

"There is not now the slightest uncertainty about the re-election of Mr. Lincoln. The only question is, by what popular and what electoral majority. God grant that both may be so decisive as to turn every hope of rebellion to despair!

"You ask about Mr. Fessenden's remaining in the cabinet. He will be a candidate for re-election to the Senate; and if successful will leave his present post in March, or sooner if circumstances allow. He has been in communication with me since he took charge, and in every step, with perhaps one slight exception, his judgment has corresponded with mine. He sees several matters now in quite a different light from that in which they appeared to him when Senator. He would now, for example, cordially support your proposition for a heavy discriminating tax upon all unnational circulation. And he is more than just--he is very generous in his appreciation of the immense work of organization and effective activity to be found in the department.

"How signally are events confirming my views as to the value of gold, compared with national currency. How clear it is now that if Congress had come boldly to the act of marked discriminative taxation on all non-national circulation and final prohibition after a few years, say two--or at most three--gold would now have been at not more than fifty per cent. premium and that resumption of specie payments might have been effected within a year. I trust the next session will witness bolder and better legislation. It will be one of your brightest honors that you so clearly saw and so boldly followed the path of reform; for certainly no greater boon--except liberty itself--can be conferred upon a nation than a truly national and thoroughly sound currency.

"Yours most truly, "S. P. Chase. "Hon. John Sherman."

After the election he wrote me the following letter, in which he referred to the appointment of a chief justice, with an evident desire for the office:

"Cincinnati, November 12, 1864. "My Dear Sir:--The papers still state you are in Washington. I am glad of it, and hope you may be able to render good service to our friend, Fessenden. The task of preparing a report is no light one. At least it always made me sweat and keep late hours. May he find a safe deliverance from the labor.

"All sorts of rumors are afloat about everything. Those which concern me most relate to the vacant seat on the bench; but I give little heed to any of them. My experience in Washington taught me how unreliable they are. If what I hear is any index to the state of opinion, Mr. Lincoln must be satisfied that in acting on the purpose expressed in your letters, he will have the almost, if not quite, unanimous approval of the Union men throughout the country. So I 'possess my soul in patience,' and urge nothing.

"If it did not seem to me a sort of indelicacy even to allow to anyone the slightest occasion to say that I solicit or even ask such an appointment as a favor or as a reward for political service, I should now be on my way to Washington; but I think it due to myself as well as the President to await his decision here; though, if appointed, I hope the appointment will be considered as made from the country at large rather than from Ohio alone. My legal residence is here; but my actual domicile is still in the District.

"Please write me, if you can, when the President will act. Let me know too how the military and political aspects at Washington appear to you. We have achieved a glorious political victory, which must greatly help our military prospects and possibilities.

"Mr. Miller has just come in and says he goes to Washington to- night. Had he come before I began, I should have spared you this letter; only asking him to make verbally the inquiries I have just set down; but I will send it with 'answer respectfully solicited.'

"Yours very cordially, "S. P. Chase. "Hon. John Sherman."

Early in December I received the following letter, which indicates very clearly that Mr. Chase was anxious for the position of chief justice, and wished his appointment made, if at all, before his arrival in Washington:

"Cleveland, December 2, 1864. "My Dear Sir:--Yours of the 27th of November reached me here to- day. Yesterday I fulfilled my appointment to make an address on the dedication of the college edifice recently erected at Mount Union, under the patronage of the Pittsburg conference of the Methodist church. A number of leading men of the denomination were present and assured me of the profound wishes of themselves and the most influential men of the connection for my appointment. These indeed seem to be universal except with an inconsiderable number whom various circumstances have made unfriendly personally. So that I cannot doubt that the President's adherence to his declared intention is more important to our cause and to his administration than it is to me personally. Not to be appointed after such declaration and such expressions would, no doubt, be a mortification; but it would not, I think, be any serious injury to me.

"I expect to be in Washington, Tuesday or Wednesday. I should have been there long since had this appointment been determined either way; but I must come now. My personal duties, unconnected with it, have required and now require my attention, and though I hated to come before I knew that there remains nothing to hope or fear concerning it, I must. I will be at the Continental, Philadelphia, Tuesday morning.

"Our news from Tennessee is important and encouraging. Garfield's success against Forrest was brilliant. I hope Thomas will succeed as well against Hood.

"General Sherman must now be near the coast. His enterprise is full of hazard, but a hazard wisely incurred as it seems to me. I ardently hope that 'out of the nettle, danger, he will pluck the flower, safety.'

"Our majority on the presidential election in Ohio turns out much less than I anticipated. It will hardly, if at all, exceed fifty thousand.

"Faithfully yours, "S. P. Chase. "Hon. John Sherman."

When I returned to Washington at the beginning of the next session I called upon the President and recommended the appointment of Mr. Chase. We had a brief conversation upon the subject in which he asked me pointedly the question whether if Chase was appointed he would be satisfied, or whether he would immediately become a candidate for President. I told him I thought his appointment to that great office ought to and would satisfy his ambition. He then told me that he had determined to appoint him and intended to send the nomination to the Senate that day and he did so, December 6, 1864. After Mr. Chase had become chief justice he still had a lingering interest in the financial policy of the country. On March 1, 1865, I received from him the following letter. The portion which refers to the legal tender laws will naturally excite some interest in view of his decision against the power of Congress to make the notes of the United States a legal tender. He wrote:

"At Home, March 1, 1865. "My Dear Sir:--More to fulfill a promise than with the hope of service I write this note.

"Your speech on the finances is excellent. There are one or two points on which I shall express myself otherwise; but, in the main, it commands the fullest assent of my judgment.

"Your appreciation of the currency question exactly corresponds with my own; only I would not give up the national currency even if we must endure for years depreciation through the issues of state banks before getting rid of them.

"The clause in the bill, as it came from the House, imposing a tax of ten per cent. on all notes not authorized by Congress which may be paid out after this year by any bank, whether state or national, will do much towards making our currency sound.

"I will briefly indicate what I should prefer and what I should most zealously labor to have sanctioned by Congress if I were at the head of the treasury department.

"1. Let the monthly tax on state bank circulation be increased to one-half of one per cent.

"2. Provide that any bank may pay into the national treasury the amount of its circulation in United States notes or national currency and that on such payment the bank making it shall be exempt from taxation on circulation.

"3. Provide for the application to the redemption of the circulation represented by such payments, of the United States notes or national currency so paid in, and strictly prohibit the paying out of such notes for any other purpose.

"This measure contemplates:

"1. An exclusive national currency.

"2. Relief of the state banks from taxation upon circulation which they cannot get in.

"3. The assumption of the duty of redemption by the national treasury with means provided by the state banks.

"4. Reduction in the amount in circulation while the payments into the treasury are being made and opportunity of some provision for redemption which will not again increase it.

"The effect will be:

"1. Healthful condition of currency and consequent activity in production and increase of resources.

"2. Gradual restoration of national notes to equality with specie and the facilitating of resumption of specie payments.

"3. Improvement of national credit.

"4. Diminution of national expenditures and possible arrest of the increase of national debt.

"Half measures are better than no measures; but thorough measures are best.

"I will only add, that while I have never favored legal tender laws in principle, and never consented to them except under imperious necessity, I yet think it unwise to prohibit the making of any of the treasury notes authorized by the bill now before Congress legal tenders. The compound interest legal tender notes have then fulfilled all my expectations for their issue and use; and may be made most useful helps in gradual reduction of the volume of circulation by substituting them for legal tenders bearing no interest.

"I cannot elaborate this now. You will see how the thing will work without any suggestion of mine. Faithfully your friend,

"S. P. Chase. "Hon. John Sherman."

From my long and intimate acquaintance with Chief Justice Chase I am quite sure that the duties of the great office he then held were not agreeable to him. His life had been a political one, and this gave him opportunity for travel and direct communion with the people. The seclusion and severe labor imposed upon the Supreme Court were contrary to his habits and injurious to his health. It took him some years to become accustomed to the quiet of judicial life. He presided over the Senate while acting as a court of impeachment during the trial of Andrew Johnson in 1868. While strongly opposed to the impeachment, he manifested no sign of partiality. He died in New York city on the 7th of May, 1873, at the age of sixty-five.

While Congress was in session, the Republican national convention met at Baltimore on the 7th day of June, 1864, to nominate candidates for President and Vice President of the United States, and to announce the principles and policy of the Republican party of the United States. The nomination of Mr. Lincoln had already been made by state legislatures and by the loyal people of the United States in every form in which popular opinion can be expressed. The feeble expressions of dissent were but a whisper compared with the loud proclamations coming from every loyal state in favor of Lincoln. The convention, with unanimous assent, ratified and confirmed the popular choice.

The nomination for Vice President was dictated by the desire to recognize the loyalty and patriotism of those who, living in states in rebellion, remained true and loyal to the Federal Union. Though Mr. Johnson disappointed the expectations of those who nominated him, yet at that time his courage and fidelity and his services and sacrifices for the cause of the Union fully justified his nomination.

More important, even, than the choice of candidates, was the declaration by the convention of the policy of the Republican party. The key-note of that policy was the third resolution, as follows:

"Resolved, that as slavery was the cause, and now constitutes the strength of this rebellion, and as it must be always and everywhere hostile to the principles of republican government, justice and the national safety demand its utter and complete extirpation from the soil of the republic; and that we uphold and maintain the acts and proclamations by which the government, in its own defense, has aimed a deathblow at the gigantic evil. We are in favor, furthermore, of such an amendment to the constitution, to be made by the people in conformity with its provisions, as shall terminate and forever prohibit the existence of slavery within the limits or the jurisdiction of the United States."

This was the logical result of the war. If it was carried into full execution, it would settle on a just and sure foundation the only danger that ever threatened the prosperity of the Union. This was happily carried into full effect by the constitutional amendment to which I have already referred.

The Democratic convention met at Chicago on the 29th of August, 1864, and nominated George B. McClellan as the candidate for President and George H. Pendleton as Vice President; but far more important and dangerous was the second, and the only material resolution of the platform which was drawn by Vallandigham and was as follows:

"Resolved, that this convention does explicitly declare, as the sense of the American people, that after four years of failure to restore the Union by the experiment of war, during which, under the pretense of a military necessity of a war power higher than the constitution, the constitution itself has been disregarded in every part, and public liberty and private right alike trodden down, and the material prosperity of the country essentially impaired, justice, humanity, liberty and the public welfare demand that immediate efforts be made for a cessation of hostilities with a view to an ultimate convention of all the states, or other peaceable means, to the end that, at the earliest practicable moment, peace may be restored on the basis of the federal union of all the states."

This was a false declaration, and was also a cowardly surrender to enemies in open war. These two resolutions made the momentous issue submitted to the American people. From the moment it was made the popular mind grew stronger and firmer in favor of the prosecution of the war and the abolition of slavery, and more resolute to resist the surrender proposed to rebels in arms. Prior to the adoption of this resolution, there was apparent languor and indifference among the people as to who should be President, but after its adoption there could be no doubt as to the trend of popular opinion. Every sentiment of patriotism, the love of flag and country, the pride of our people in the success of our soldiers, and the resentment of the soldiers themselves at this slur on their achievements--all contributed to the rejection of the candidates and the platform of the Democratic party, and the overwhelming victory of the Republican party.

I had already entered into the canvass when this resolution of Vallandigham was adopted. It was only necessary to read it to the people of Ohio to arouse resentment and opposition. The scattered opposition to Mr. Lincoln, much of it growing out of his conservatism, at once disappeared. The discontented Republicans who met in convention at Cleveland again became active in the Republican ranks. The two parties that grew out of factional politics in New York, the Blair party and its opponents in Missouri, and the army of disaffected office-seekers, waived their dissensions and griefs. Horace Greeley and the extreme opponents of slavery, represented by Wendell Phillips, not satisfied with the slow, but constitutional process of emancipation proposed by Lincoln, when compelled to choose between that plan of abolition and unconditional surrender to slavery, naturally voted for Lincoln. The great body of patriotic Democrats in all the states, who supported the war, but were still attached to their party, quietly voted for Lincoln. In Ohio, especially, where a year before they voted against Vallandigham for his disloyalty, they naturally voted against his resolution for surrender to the rebels.

During the campaign I accompanied Johnson to Indiana where he made patriotic speeches to great audiences. His arraignment of the autocracy of slaveholders in the south was very effective. The current of opinion was all in favor of Lincoln. The result of the election for Members of Congress in the states voting in October was a decisive indication of the result in November. All the central states elected a large majority of Republican Members of Congress. In Ohio the Union party had a majority of over 50,000 and elected 17 Republican and 2 Democratic Members of the House of Representatives. In 1862 Ohio elected 14 Democratic and 5 Republican Members. The presidential election that followed on the 8th of November, 1864, resulted in an overwhelming victory for Lincoln. He received 212 and McClellan 21 electoral votes, the latter from the States of New Jersey, Delaware and Kentucky. This political victory had a more decisive effect in defeating the rebellion than many battles. I returned to Washington soon after the election.

I was naturally deeply interested in the movements of General Sherman's march to the sea. Towards the close of November we had all sorts of rumors from the south, that General Sherman was surrounded by Confederate troops, that his supplies were cut off, that successful attacks had been made upon his scattered forces. I naturally became uneasy, and went to President Lincoln for consolation and such news as he could properly give me. He said: "Oh, no, we have no news from General Sherman. We know what hole he went in at, but we do not know what hole he will come out of," but he expressed his opinion that General Sherman was all right. Soon after, authentic information came that General Sherman had arrived at Savannah, that Fort McAllister was taken, and the army was in communication with the naval forces. The capture of Savannah and the northward march of General Sherman's army is part of the familiar military history of the country.

The second session of the 38th Congress convened on the 5th of December, 1864. It was a busy and active session confined mainly to appropriations, loan and currency bills. The necessary expenditures had been so greatly increased by the war that the aggregate amounts appropriated naturally created some opposition and alarm, but there was no help for it. As chairman of the committee on finance I did all I could to reduce the appropriations for civil expenses, but in respect to military expenditures there could scarcely be any limit, the amount necessary being dependent upon military success. The hopeful progress of the war gave encouragement that in a brief period the power of the Confederate States would be exhausted and peace would follow. We had, however, to legislate upon the basis of the continued prosecution of the war, and it therefore became necessary to increase the revenues in every possible way, and to provide for new loans. The act approved March 3, 1865, authorized the Secretary of the Treasury to borrow not exceeding $600,000,000, and to issue therefore bonds or treasury notes of the United States in such form as he might provide. This was the last great loan authorized during the war. An act to provide internal revenue to support the government was approved on the same day, which modified many of the provisions of the previous act, but added subjects of taxation not embraced in previous laws. It especially increased the taxes on tobacco in its various forms. The 6th section provided:

"That every national banking association, state bank, or state banking association, shall pay a tax of ten per centum on the amount of notes of any state bank or state banking association, paid out by them after the first day of July, eighteen hundred and sixty- six."

This tax on state bank circulation was a practical prohibition of all state bank paper, and before the time fixed for the commencement of the tax, this circulation entirely disappeared. Additional duties were placed upon certain foreign importations. Provisions were also made for the collection in the insurrectionary districts within the United States of the direct taxes levied under the act of 1862. During the entire season my labor was excessive, and when it closed my health and strength were greatly impaired.

CHAPTER XVI. ASSASSINATION OF ABRAHAM LINCOLN. Johnson's Maudlin Stump Speech in the Senate--Inauguration of Lincoln for the Second Term--My Trip to the South--Paying off a Church Debt--Meetings to Celebrate the Success of the Union Army-- News of the Death of Lincoln--I Attend the Funeral Services--General Johnston's Surrender to General Sherman--Controversy with Secretary Stanton Over the Event--Review of 65,000 Troops in Washington--Care of the Old Soldiers--Annual Pension List of $150,000,000--I am Re- elected to the Senate--The Wade-Davis Bill--Johnson's Treatment of Public Men--His Veto of the Civil Rights Bill--Reorganization of the Rebel States and Their Final Restoration to the Union.

On the 4th of March, 1865, at the inauguration of the President and Vice President elect, a scene occurred in the Senate chamber, which made a serious impression, and was indicative of what was to occur in the future. About eleven o'clock of that day Andrew Johnson, Vice President, was shown into the room in the capitol assigned to the Vice President. He complained of feeling unwell and sent for either whisky or brandy, and must have drunk excessively of it. A few minutes before twelve o'clock he was ushered into the Senate to take the oath of office and to make the usual brief address. He was plainly intoxicated and delivered a stump speech unworthy of the occasion. Before him were assembled all the principal officers of the government and the diplomatic corps. He went on in a maudlin and rambling way for twenty minutes or more, until finally he was suppressed by the suggestion of the secretary that the time for the inauguration had arrived, and he must close.

The procession was formed for the inauguration at the east front of the capitol, where a great multitude was gathered. There Mr. Lincoln delivered his memorable inaugural address. Referring to the condition of the controversy at the time of his former inaugural, he said:

"Both parties deprecated war; but one of them would make war rather than let the Union survive; and the other would accept war rather than let it perish. And the war came."

He hopefully predicted the result of the war, but he said:

"Yet, if God wills that it continue until all the wealth piled by the bondsman's two hundred and fifty years of unrequited toil shall be sunk, and until every drop of blood drawn with the lash shall be paid by another drawn with the sword, as was said three thousand years ago, so still it must be said, 'The judgments of the Lord are true and righteous altogether.'"

His peroration will always be remembered for its impressive eloquence:

"With malice towards none, with charity for all, with firmness in the right, as God gives us to see the right, let us strive on to finish the work we are in; to bind up the nation's wounds; to care for him who shall have borne the battle, and for his widow, and his orphan; to do all which may achieve and cherish a just and lasting peace among ourselves and with all nations."

Soon after the adjournment I was invited by Secretary Stanton, with many other Senators and our families, to take a trip to the south in the steamer "Baltic." Among those on board were Senators Simon Cameron, Wade, Zach. Chandler, and Foster, of Connecticut, then president pro tempore of the Senate. The sea was exceedingly boisterous. Nearly all on board were sea sick, but none so badly as Wade and Chandler, both of whom, I fear, violated the third commandment, and nearly all the party were in hearty sympathy with them. I was a good sailor and about the only one who escaped the common fate. We visited the leading places of interest along the coast, but especially Charleston, Beaufort and Savannah. Charleston had but recently been evacuated. General Sherman was then on his march through North Carolina. In Charleston everything looked gloomy and sad. I rode on horseback alone through different parts of the city, and was warned by officers not to repeat the ride, as, if my name was known, I would be in danger of being shot.

We arrived in Beaufort on Sunday morning. The town was then full of contrabands. We remained there that day and received an invitation from a negro preacher to attend religious services at his new meeting-house. About fifteen or twenty of the party went to the "meeting-house," a new unfinished skeleton-frame house of considerable size without any plastering--a mere shell. We were shown to seats that had been reserved for us. The rest of the congregation were negroes in every kind of dress and of every shade of color. The scene was very interesting, but the sermon of the preacher was little better than gibberish. He was a quaint old man, wearing goggles and speaking a dialect we could hardly understand. At the close of his sermon he narrated how the meeting-house had been built; that John had hauled the logs, Tom, Dick and Harry, naming them, had contributed their labor, but they were in debt something over $200, and, with a significant glance at our little party, he thought this was a good time to take up a collection. No sooner was this said than Cameron, whispering to me, said: "Let's pay it; I'll give twenty dollars," and when the hat came around, instead of the usual dimes and quarters in ragged currency, it received greenbacks of good denominations. In the meantime the old preacher, highly elated, called upon the audience to sing "John Brown's Body." A feeble, piping voice from an old negro woman started the singing and the rest of the negroes, with loud melodious voices, joined in, and, before it was through, the rest of us joined in. The hat, when returned to the preacher, was found to contain more than fifty dollars in excess of the amount necessary to pay off the debt. Then, with many thanks to us by the preacher, the audience was requested to remain standing until their visitors left.

Our visit at Savannah was very interesting. We there found many leading citizens of the town who were social and kind, treating us in a friendly way by rides around the city.

In the latter part of March, I was invited by General Sherman, then on a visit to Grant near Petersburg, Virginia, to go with him to Goldsboro, North Carolina, where his army was then encamped. Secretary Stanton was my next door neighbor, and our families were intimately associated. I invited his eldest son, Edwin, then a young man studying law, to accompany me, an invitation which he gladly accepted. We joined General Sherman at Fortress Monroe and accompanied him on the steamer "Bat" to Newbern and thence by rail to Goldsboro. There was a sense of danger in traveling by rail through a country mostly unoccupied, but we reached the army at Goldsboro safely. There I had my first view of a great army in marching garb. Most of the troops had received their new uniforms and equipments, but outlying regiments were constantly coming in, ragged, with tattered hats, shoes and boots of every description, almost black from exposure and the smoke of the pine woods, and as hardy a looking set of men as one could conceive of. They had picked up all kinds of paraphernalia, "stove pipe" hats being the favorite, and had all sorts of wagons gathered in their march. Their appearance was rapidly changed by new uniforms. After a brief visit I returned to Washington, and thence to my home in Mansfield.

I was invited soon after, on the 14th of April, to attend a mass meeting at Columbus to celebrate the success of the Union army. I accepted the invitation and attended an immense meeting in the open air on the capitol grounds, and there Samuel Galloway and myself made addresses. Meetings were held, congratulations uttered in the evening of that day. The whole city was in holiday attire, ornamented with flags, and everywhere and with everybody, there was an expression of joy. I retired late at night to my room in the hotel, and after my fatigue slept soundly.

Early the next morning Rush Sloane, a personal friend, rapped at my door and announced to me the news of the assassination of Lincoln, and, as then reported, that of Seward. The change from joy to mourning that day in Columbus was marked and impressive. No event of my life created a more painful impression than this news following the rejoicings of the day before. I returned to Washington and attended the funeral services over the body of Mr. Lincoln, then about to be carried on the long journey to his old home in Springfield, Illinois.

On the 6th of May, in response to the invitation of my neighbors in Mansfield, I made an address upon the life and character of the dead President. It expressed the opinion and respect I then entertained for him, and now I could add nothing to it. As time moves on his name and fame become brighter, while most of his contemporaries are one by one forgotten.

Soon after the death of Mr. Lincoln, the terms of the surrender of General Johnston to General Sherman became the subject of a violent controversy. On the 21st of April, Secretary Stanton issued an order to General Grant to proceed immediately to the headquarters of General Sherman and direct operations against the enemy. He issued a bulletin in which he intimated that Davis and his partisans were on their way to escape to Mexico or Europe with a large amount of gold plundered from the Richmond banks and from other sources, and that they hoped to make terms with General Sherman by which they would be permitted with their effects, including their gold plunder, to go to Mexico or Europe. The most violent and insulting paragraphs were published in the newspapers, substantially arraigning General Sherman as a traitor and imputing to him corrupt motives. I felt myself bound at once, not to defend the terms of surrender, but to repel the innuendoes aimed at General Sherman. This led me into a controversy with Mr. Stanton, not worth while to recall.

I believed then and still believe that he was under the influence of perhaps a well-grounded fear that his life was in danger. The atmosphere of Washington seemed to be charged with terror, caused by the assassination of Lincoln, the wounding of Seward and the threats against all who were conspicuous in political or military life in the Union cause. Now, since we are fully informed of all the surrounding circumstances connected with the surrender, and the belief of General Sherman that he was strictly carrying out the policy of President Lincoln, it is plain that he acted in what he supposed was the line of duty. He did not comprehend that the fatal crime in Washington changed the whole aspect of affairs. His agreement with Johnston was on its face declared to be inoperative until approved by the authorities at Washington, and, while the political features of the surrender could not be approved, a simple notification of disapproval would have been cheerfully acted upon and the orders of the President would have been faithfully carried out.

General Sherman, when he received notice of the disapproval of his action, at once notified Johnston, and new terms were arranged in exact accordance with those conceded by General Grant to General Lee.

I remained in Washington until the arrival, on the 19th of May, of General Sherman's army, which encamped by the roadside about half way between Alexandria and the Long Bridge. I visited the general there and found that he was still smarting under what he called the disgrace put upon him by Stanton. I advised him to keep entirely quiet, said the feeling had passed away and that his position was perfectly well understood. I persuaded him to call on the President and such members of the cabinet as he knew, and accompanied him. He was dressed in full uniform, well worn, was bronzed and looked the picture of health and strength. As a matter of course he refused to call on Stanton and denounced him in unmeasured terms, declaring that he would insult him whenever the opportunity occurred. When he came in contact with his fellow officers and found that they sympathized with him his anger abated, and by the time the great review took place, he seemed to have recovered his usual manner.

The review of General Meade's army was to occur on Tuesday, May 23, and that of General Sherman's, as it was called, on the 24th. General Sherman, with his wife and her father, Hon. Thomas Ewing, and myself, were present on the reviewing stand on the first day of the review. He received on the stand the congratulations of hundreds of people and seemed to enjoy every moment of time. He was constantly pointing out to Mr. Ewing and myself the difference between the eastern and western armies, in which he evidently preferred the Army of the West. On the next day, prompt to the time stated, attended by a brilliant staff, he rode slowly up Pennsylvania avenue at the head of his column, and was followed by a magnificent army of 65,000 men, organized into four army corps, and marching with that precision only possible with experienced troops. His description of the scene in his "Memoirs" proves his deep interest in the appearance of his army and his evident pride in it. When he arrived at the grand stand, where the President reviewed the troops, he dismounted, left the line, came upon the stand and took his place by the side of the President. Everyone knew his relations to Stanton, and was curious to see the result of their meeting. I stood very near the general, and as he approached he shook hands with the President and the members of the cabinet, but when Stanton partially reached out his hand, General Sherman passed him without remark, but everyone within sight could perceive the intended insult, which satisfied his honor at the expense of his prudence. However, it is proper to say that these two men, both eminent in their way, became entirely reconciled before the death of Mr. Stanton. General Sherman always stopped with me when he was temporarily in Washington, and I know that in a brief period they met and conversed in a friendly way. When Mr. Stanton lay upon his death bed, General Sherman not only called upon him, but tendered his services, and exhibited every mark of respect for him.

The great body of the volunteer forces was disbanded, the officers and soldiers were returning to their homes. To most of them the war was a valuable lesson. It gave them a start in life and a knowledge and experience that opened to door to all employment, especially to official positions in state and nation. In all popular elections the soldier was generally preferred. This was a just recognition for his sacrifices and services. I hope and trust that while a single survivor of the War of the Rebellion is left among us, he will everywhere be received with honor and share all the respect which the boys of my generation were so eager to grant and extend to the heroes of the Revolutionary War. The service of one was as valuable as the other, rendered on a broader field, in greater numbers, with greater sacrifices, and with the same glorious results of securing the continuance of an experiment of free government, the most successful in the history of mankind and which is now, I profoundly trust, so well secured by the heroism and valor of our soldiers, that for generations and centuries yet to come no enemy will dare to aim a blow at the life of the republic. For the wounded and disabled soldiers and the widows and orphans of those who fell, a larger provision of pensions was freely granted than ever before by any nation in ancient or modern times. Provision was made by the general government, and by most of the loyal states, for hospitals and homes for the wounded. The bodies of those who died in the service have been carefully collected into cemeteries in all parts of the United States. If there has been any neglect or delay in granting pensions, it has been caused by the vast number of applications--more than a million--and the difficulty as time passes in securing the necessary proof. The pension list now, thirty years after the war, requires annually the sum of more than $150,000,000, or three times the amount of all the expenses of the national government before the war. No complaint is made of this, but Congress readily grants any increase demanded by the feebleness of age or the decay of strength. I trust, and believe, that this policy will be continued until the last surviving soldier of the war meets the common fate of all.

I participated in the canvass of 1865, when General Jacob D. Cox, the Republican candidate for governor of Ohio, and a Republican legislature were elected with but little opposition. The first duty of this legislature was to elect a Senator. There was a friendly contest between General Robert C. Schenck, Hon. John A. Bingham and myself, but I was nominated on the first ballot and duly elected.

I received many letters from Horace Greeley, in the following one of which he showed great interest in my re-election to the Senate:

"New York, February 7, 1865. "Hon. John Sherman:

"My Dear Sir:--Yours of the 5th inst. at hand. I can assure you that the combination to supplant you in the Senate is quite strong and confident of success. I did not mean to allude to the controversy, but was compelled to by the dispatch which got into our columns. I observe J. W. wrote 'locality' as he says, but the change to 'loyalty' was a very awkward one in these days; so I felt compelled to correct it.

"I fear more the raids of Thad. Stevens on the treasury than those of Mosby on our lines.

"Yours, "Horace Greeley."

When Congress met on the 4th of December, 1865, it had before it two important problems which demanded immediate attention. One was a measure for the reconstruction of the states lately in rebellion and the other was a plan for refunding and paying the public debt. It was unfortunate that no measure had been provided before the close of the war defining the condition of the states lately in rebellion, securing the freedmen in their new-born rights, and restoring these states to their place in the Union. Therefore, during the long vacation, from April to December, the whole matter was left to executive authority. If Lincoln had lived, his action would have been acquiesced in. It would have been liberal, based upon universal emancipation of negroes, and pardon to rebels. It was supposed that President Johnson would err, if at all, in imposing too harsh terms upon these states. His violent speeches in the canvass of 1864, and his fierce denunciation of the leaders in the Rebellion, led us all to suppose that he would insist upon a reconstruction by the loyal people of the south and that reasonable protection would be extended to the emancipated negroes. The necessity of legislation for the reconstruction of the Confederate states was foreseen and provision had been made by Congress, during the war, by what was known as the Wade-Davis bill, to provide for the reorganization of these states. During the 37th Congress, Henry Winter Davis, though not then a Member of the House of Representatives, prepared a bill to meet this exigency. It was a bill to guarantee to each state a republican form of government. It embodied a plan by which these states, then declared by Congress to be in a state of insurrection, might, when that insurrection was subdued or abandoned, come back freely and voluntarily into the Union. It provided for representation, for the election of a convention and a legislature, and of Senators and Members of Congress. It was a complete guarantee to the people of the insurrectionary states that upon certain conditions these states might resume their place in the Union when the insurrection had ceased. This bill he handed to me. I introduced it at his request. It was referred to the judiciary committee, but was not acted upon by it.

Afterwards Mr. Davis came into the 38th Congress as a Member of the House of Representatives. Among the first acts performed by him after taking his seat was the introduction of this same bill. On the 15th of December, 1863, it was debated in the House of Representatives and passed by a very decided vote, and was sent to the Senate. It was reported to the Senate favorably, but in place of it was substituted a proposition offered by B. Gratz Brown, of Missouri. This substitute provided a mode by which the eleven Confederate states might, when the Rebellion was suppressed within their limits, be restored to their old places in the Union. The bill was sent back to the House with the proposed substitute. A committee of conference was appointed, and the House preferring the original bill, the Senate receded from its amendment, and what was known as the Wade-Davis bill passed. It went to President Lincoln, who did not approve it, and it did not become a law, but on the 8th of July, 1864, after the close of the session, he issued the following proclamation:

"Whereas, at the late session Congress passed a bill to guaranty to certain states, whose governments have been usurped or overthrown, a republican form of government, a copy of which is hereunto annexed; and whereas the said bill was presented to the President of the United States for his approval less than one hour before the sine die adjournment of said session, and was not signed by him; and whereas the said bill contains, among other things, a plan for restoring the states in rebellion to their proper practical relation in the Union, which plan expresses the sense of Congress upon that subject, and which plan it is now thought fit to lay before the people for their consideration:

"Now, therefore, I, Abraham Lincoln, President of the United States, do proclaim, declare, and make known, that while I am (as I was in December last, when by proclamation I propounded a plan for restoration) unprepared, by a formal approval of this bill, to be inflexibly committed to any single plan of restoration; and while I am also unprepared to declare that the free state constitutions and governments already adopted and installed in Arkansas and Louisiana shall be set aside and held for naught, thereby repelling and discouraging the loyal citizens who have set up the same as to further effort, or to declare a constitutional competency in Congress to abolish slavery in states, I am at the same time sincerely hoping and expecting that a constitutional amendment abolishing slavery throughout the nation may be adopted."

He added his reasons for not approving the Wade-Davis bill. He did not entirely disapprove of it, but said it was one of numerous plans which might be adopted. Mr. Sumner stated, on the floor of the Senate, that he had had an interview with President Lincoln immediately after the publication of that proclamation, and it was the subject of very minute and protracted conversation, in the course of which, after discussing the details, Mr. Lincoln expressed his regret that he had not approved the bill. I have always thought that Mr. Lincoln made a serious mistake in defeating a measure, which, if adopted, would have averted many if not all the difficulties that subsequently arose in the reconstruction of the rebel states.

The next and closing session of that Congress neglected to provide for the reorganization of these states, and, thus, when Mr. Johnson became President, there was no provision of law to guide him in the necessary process of reconstruction. Thus, by the disagreement between Congress and President Lincoln, which commenced two years before the close of the war, there was no law upon the statute book to guide either the President or the people of the southern states in their effort to get back into the Union. It became imperative during the long period before the meeting of Congress that President Johnson should, in the absence of legislation, formulate some plan for the reconstruction of these states. He did adopt substantially the plan proposed and acted upon by Mr. Lincoln. After this long lapse of time I am convinced that Mr. Johnson's scheme of reconstruction was wise and judicious. It was unfortunate that it had not the sanction of Congress and that events soon brought the President and Congress into hostility. Who doubts that if there had been a law upon the statute book by which the people of the southern states could have been guided in their effort to come back into the Union, they would have cheerfully followed it, although the conditions had been hard? In the absence of law both Lincoln and Johnson did substantially right when they adopted a plan of their own and endeavored to carry it into execution. Johnson, before he was elected and while acting as military governor of Tennessee, executed the plan of Lincoln in that state and subsequently adopted the same plan for the reorganization of the rebel states. In all these plans the central idea was that the states in insurrection were still states, entitled to be treated as such. They were described as "The eleven states which have been declared to be in insurrection." There was an express provision that:

"No Senator or Representative shall be admitted into either branch of Congress from any of said states until Congress shall have declared such state entitled to such representation."

In all the plans proposed in Congress, as well as in the plan of Johnson, it was declared that states had no right while in insurrection to elect electors to the electoral college; they had no right to elect Senators and Representatives. In other words they could not resume the powers, rights and privileges conferred upon states by the Constitution of the United States, except by the consent of Congress. Having taken up arms against the United States, they by that act lost their constitutional powers within the United States to govern and control our councils. They could not engage in the election of a President, or of Senators or Members of Congress; but they were still states. The supreme power of Congress to change, alter or modify the acts of the President and to admit or reject these states and their Senators and Representatives at its will and pleasure, and the constitutional right of the respective Houses to judge of the election, returns and qualifications of its own Members were recognized. When Mr. Johnson came into power he found the Rebellion substantially subdued. His first act was to retain in his confidence, and in his councils, every member of the cabinet of Abraham Lincoln, and, so far as we know, every measure adopted by him had the approval and sanction of that cabinet. Every act passed by Congress, with or without his assent, upon every subject whatever, connected with reconstruction, was fairly and fully executed. He adopted all the main features of the Wade- Davis bill--the only one passed by Congress. In his proclamation of May 9, 1865, he provided:

"First, That all acts and proceedings of the political, military, and civil organizations which have been in a state of insurrection and rebellion within the State of Virginia against the authority and laws of the United States, and of which Jefferson Davis, John Letcher, and William Smith were late the respective chiefs, are declared null and void."

Thus, with a single stroke, he swept away the whole superstructure of the Rebellion. He extended the tax laws of the United States over the rebel territory. In his proclamation of May 29, he says:

"To the end, therefore, that the authority of the government of the United States may be restored, and that peace, order, and freedom may be established, I, Andrew Johnson, President of the United States, do proclaim and declare that I hereby grant to all persons who have directly or indirectly participated in the existing Rebellion, except as hereinafter excepted, amnesty and pardon, with restoration of all rights of property, except as to slaves, and except in cases where legal proceedings, under the laws of the United States providing for the confiscation of property of person engaged in rebellion, have been instituted, &c."

He enforced in every case full and ample protection to the freedmen of the southern states. No complaint from them was ever brought to his knowledge in which he did not do full and substantial justice. The principal objection to his policy was that he did not extend his proclamation to all the loyal men of the southern states, including the colored as well as the white people. It must be remembered in his justification that in every one of the eleven states before the Rebellion the negro was, by the laws, excluded from the right to vote. In Ohio, Pennsylvania and New York that right was limited. In a large majority of the states, including the most populous, negro suffrage was then prohibited. It would seem to be a great stretch of power on his part, by a simple mandatory proclamation or military order, to confer the franchise on a class of people, who were then prohibited from voting not only in the eleven southern states, but in a majority of the northern states. Such a provision, if it had been inserted, could not have been enforced, and, in the condition in which slavery left the negro race, it could hardly be defended. I cannot see any reason why, because a man is black, he should not vote, and yet, in making laws, as the President was then doing, for the government of the community, he had to regard the prejudices, not only of the people among whom the laws were to be executed, but also of the army and the people who were to execute those laws, and no man can doubt but what at that time there was a strong and powerful prejudice in the army and among all classes of citizens against extending the right of suffrage to negroes, especially down in the far south, where the great body of the slaves were in abject ignorance.

It must be also noted that in the Wade-Davis bill Congress did not and would not make negro suffrage a part of its plan. Even so radical an anti-slavery man as my colleague, Senator Wade, did not propose such a measure. The effort was made to give emancipated negroes the right to vote, and it was abandoned. By that bill the suffrage was conferred only upon white male loyal citizens. And in the plan of the President, he adopted in this respect the very same conditions for suffrage as those proposed by Congress. I believe that all the acts and proclamations of President Johnson before the meeting of Congress were wise and expedient, and that there would have been no difficulty between Congress and the President but for his personal conduct, and, especially, his treatment of Congress and leading Congressmen. The unfortunate occurrence, already narrated, at his inauguration, was followed by violent and disrespectful language, unbecoming the President, especially, his foolish speech made on the 22nd of February, 1866, in which he selected particular persons as the objects of denunciation. He said:

"I fought traitors and treason in the south. I opposed the Davises, the Toombses, the Slidells, and a long list of others, which you can readily fill without my repeating the names. Now, when I turn round, and at the other end of the line find men, I care not by what name you call them, who still stand opposed to the restoration of the Union of these states, I am free to say to you that I am still in the field."

And again he said:

"I am called upon to name three at the other end of the line; I am talking to my friends and fellow-citizens, who are interested with me in this government, and I presume I am free to mention to you the names of those whom I look upon as being opposed to the fundamental principles of this government, and who are laboring to pervert and destroy it."

Voices: "Name them!" "Who are they!"

He replied:

"You ask me who they are. I say Thaddeus Stevens, of Pennsylvania, is one; I say Mr. Sumner, of the Senate, is another; and Wendell Phillips is another."

The violence of language, so unlike that of Abraham Lincoln, added to the hostility to Mr. Johnson in Congress, and, I think, more than any other cause, led to his impeachment by the House of Representatives.

In the beginning of the controversy between Congress and the President, I tried to act as a peacemaker. I knew Mr. Johnson personally, his good and his bad qualities. I sat by his side in the Senate chamber during the first two years of the war. I was with him in his canvass in 1864. I sympathized with him in his struggles with the leaders of the Rebellion and admired his courage during the war, when, as Governor of Tennessee, he reorganized that state upon a loyal basis. The defect of his character was his unreasoning pugnacity. He early became involved in wordy warfare with Sumner, Wade, Stevens and others. In his high position he could have disregarded criticism, but this was not the habit of Johnson. When assailed he fought, and could be as violent and insulting in language and acts as anyone.

Under these circumstances I made a long and carefully considered speech in the Senate on the 26th of February, 1866, in which I stated the position of Congress on the reconstruction measures, and the policy adopted by Johnson from Lincoln. Either of these plans would have accomplished the provisional restoration of these states to the Union, while all agreed that, when admitted, they would be armed with all the powers of states, subject only to the constitution of the United States. I believed then, and believe now, that the quarrel with Johnson did much to weaken the Republican party. In consequence of it several Republican Senators and Members severed their connection with that party and joined the Democratic party. Johnson, irritated by this antagonism, drifted away from the measures he had himself advocated and soon after was in open opposition to the party that elected him. I here insert passages from my speech, which expressed my views at the time, and which I now feel were justified by the then existing opinions and conditions of political life:

"Sir, I can imagine no calamity more disgraceful than for us by our divisions to surrender, to men who to their country were enemies in war, any or all of the powers of this government. He, who contributes in any way to this result, deserves the execrations of his countrymen. This may be done by thrusting upon the President new issues on which the well-known principles of his life do not agree with the judgment of his political associates. It may be done by irritating controversies of a personal character. It may be done by the President turning his back upon those who trusted him with high power, and thus linking his name with one of the most disgraceful in American history, that of John Tyler. I feel an abiding confidence that Andrew Johnson will not and cannot do this; and, sir, who will deny that the overbearing and intolerant will of Henry Clay contributed very much to the defection of John Tyler? But the division of the Whig party was an event utterly insignificant in comparison with the evil results of a division in the Union party.

"Where will be the four million slaves whom by your policy you have emancipated? What would be their miserable fate if now surrendered to the custody of the rebels of the south? Will you, by your demand of universal suffrage, destroy the power of the Union party to protect them in their dearly purchased liberty? Will you, by new issues upon which you know you have not the voice of the people, jeopard these rights which you can by the aid of the Union party secure to these freedmen? We know that the President can not and will not unite with us upon the issues of universal suffrage and dead states, and he never agreed to. No such dogmas were contemplated, when, for his heroic services in the cause of the Union, we placed him, side by side, with Mr. Lincoln as our standard-bearer. Why, then, present these issues? Why decide upon them? Why not complete the work so gloriously done by our soldiers in securing union and liberty to all men without distinction of color, leaving to the states, as before, the question of suffrage.

"Sir, the curse of God, the maledictions of millions of our people, and the tears and blood of new-made freedmen will, in my judgment, rest upon those who now for any cause destroy the unity of the great party that has led us through the wilderness of war. We want now peace and repose. We must now look to our public credit. We have duties to perform to the business interests of the country, in which we need the assistance of the President. We have every motive for harmony with him and with each other, and for a generous and manly trust in his patriotism. If ever the time shall come when I can no longer confide in his devotion to the principles upon which he was elected, I will bid farewell to Andrew Johnson with unaffected sorrow. I will remember when he stood in this very spot, five years ago, repelling with unexampled courage the assaults of traitors. He left in their hands wife, children, property, and home, and staked them all on the result. I will remember that when a retreating general would have left Nashville to its fate, that again, with heroic courage, he maintained his post. I will remember the fierce conflicts and trials through which he and his fellow- compatriots in east Tennessee maintained our cause in the heart of the Confederacy. I will remember the struggles he had with the aristocratic element of Tennessee, never ashamed of his origin and never far from the hearts of the people.

"Sir, you must not sever the great Union party from this loyal element of the southern states. No new theories of possible utopian good can compensate for the loss of such patriotism and devotion. Time, as he tells you in his message, is a great element of reform, and time is on your side. I remember the homely and encouraging words of a pioneer in the anti-slavery cause, an expelled Methodist preacher from the south, who told those who were behind him in his strong anti-slavery opinions: 'Well, friends, I'll block up awhile; we must all travel together.' So I say to all who doubt Andrew Johnson, or who wish to move more rapidly than he can, to block up awhile, to consolidate their great victory with the certainty that reason and the Almighty will continue their work. All wisdom will not die with us. The highest human wisdom is to do all the good you can, but not to sacrifice a possible good to attempt the impracticable. God knows that I do not urge harmony and conciliation from any personal motive. The people of my native state have intrusted me with a position here extending four years beyond the termination of the President's term of office. He can grant me no favor.

"If I believed for a moment that he would seek an alliance with those who, by either arms or counsel or even apathy, were against their country in the recent war, and will turn over to them the high powers intrusted to him by the Union party, then, sir, he is dishonored, and will receive no assistance from me; but I will not force him into that attitude. If he shall prove false to the declaration made by him in his veto message, that his strongest desire was to secure to the freedmen the full enjoyment of their freedom and property, then I will not quarrel with him as to the means used. And while, as he tells us in this same message, he only asks for states to be represented which are presented in an attitude of loyalty and harmony and in the persons of representatives whose loyalty cannot be questioned under any constitutional or legal test, surely we ought not to separate from him until, at least, we prescribe a test of their loyalty, upon which we are willing to stand. We have not done it yet. I will not try him by new creeds. I will not denounce him for hasty words uttered in repelling personal affronts.

"I see him yet surrounded by the cabinet of Abraham Lincoln, pursuing Lincoln's policy. No word from me shall drive him into political fellowship with those who, when he was one of the moral heroes of this war, denounced, spit upon him, and despitefully used him. The association must be self-sought, and even then I will part with him in sorrow, but with the abiding hope that the same Almighty power that has guided us through the recent war will be with us still in our new difficulties until every state is restored to its full communion and fellowship, and until our nation, purified by war, will assume among the nations of the earth the grand position hoped for by Washington, Clay, Webster, Lincoln, and hundreds of thousands of unnamed heroes who gave up their lives for its glory."

I received many letters in commendation of this speech, among others the following from Thurlow Weed, who was in full sympathy with Secretary Seward:

"Albany, N. Y., February 28, 1866. "Dear Sherman:--You have spoken words of wisdom and patriotism-- spoken them boldly at the right time. They will help save the Union--and they will save the Union particularly if fanatics and despots will allow it to be saved. Just such a speech at the moment it was made is worth more than all that has been said in Congress since the session commenced. I thank you gratefully for it.

"Yours truly, "Thurlow Weed."

I still hoped that the pending civil rights bill would be approved by the President, and that then the controversy would end. On the 17th of March, 1866, I made a speech at Bridgeport, Conn., in which I said:

"Now, I say, that upon all these various propositions, upon the necessity of a change in the basis of representation, upon the necessity for protecting the negroes, upon this question of suffrage --upon all these questions that have arisen in our politics of late, the differences between Andrew Johnson and Congress are not such as need excite the alarm of any patriotic citizen. No, my friends, we have a great duty to perform to our country. Every man in public life now has a heavy responsibility resting upon him, in the discharge of which he is bound to follow the dictates of his own conscience, given to him by Almighty God. There are, there must be, differences of opinion; God has so made us that we must differ; it is the established nature of the human mind to disagree. It is only by discussion and comparison of views that the highest human wisdom is elicited. Therefore, I say again, that no Union man need feel anxious or uneasy because of the differences between the President and Congress. Let me tell you, as the solemn conviction with which I address you to-night, that Andrew Johnson never will throw the power we have given him into the hands of the Copperhead party of the United States.

"I have many reasons for this faith. One is that no nomination has ever been sent by Andrew Johnson to the Senate of the United States of any man of that stripe of politics. No flattery, no cajolery can draw him from that line. He is a man who fights his own battles, and whether they are old friends or foes that assail him he fights them with equal freedom and boldness, and sometimes, perhaps indiscreetly; but that is a fault of his character, which need excite no uneasiness in the minds of the people.

"On Thursday, the day that I left Washington, we sent to him a bill which secures to all the colored population of the southern states equal rights before the law, the civil rights bill. It declares that no state shall exclude any man on account of his color from any of the natural rights which, by the Declaration of Independence, are declared to be inalienable; it provides that every man may sue and be sued, may plead and be impleaded, may acquire and hold property, may purchase, contract, sell and convey; all those rights are secured to the negro population. That bill is now in the hands of the President. If he sign it, it will be a solemn pledge of the law-making power of the nation that the negroes shall have secured to them all these natural and inalienable rights. I believe the President will sign it."

Unfortunately at the end of ten days the President sent to the Senate the civil rights bill, referred to, with his message vetoing it. It passed both Houses with the requisite two-thirds majority, and thus became a law. This veto was followed by other vetoes, and, practically, the President abandoned his party. From this time forth, I heartily joined with my political associates in the measures adopted to secure a loyal reorganization of the southern states. I was largely influenced by the harsh treatment of the freedmen in the south under acts adopted by the reconstructed legislatures. The outrages of the Ku-Klux-Klan seemed to me to be so atrocious and wicked that the men who committed them were not only unworthy to govern, but unfit to live. The weakness of the position of Congress in the controversy with Mr. Johnson, was, that it had furnished no plan of reconstruction and he was compelled to act upon the urgency of events. Many efforts were made to provide legislation to take the place of the proclamations and acts of the President, but a wide divergence of opinion in the Republican party manifested itself, and no substantial progress was made until near the close of the second session of the 39th Congress. Several bills were then pending in each House to provide governments for the insurrectionary states. On the 13th of February, 1867, during the short session, a bill with that title came from the House of Representatives. It was manifest unless this bill could be acted upon, that, in the then condition of Congress, all legislation would fail. It was kept before the Senate and thoroughly debated. On the 16th of February, after consultation with my political colleagues, I moved a substitute for the House bill. The fifth section of this substitute embodied a comprehensive plan for the organization of the rebel states with provision for elections in said states, and the conditions required for their administration and restoration to the Union and the exercise by them of all the powers of states, and provided for the election of Senators and Members of Congress. In presenting this substitute, I briefly stated my reasons for it, as follows:

"The principle of this bill is contained in the first two lines of the preamble. It is founded upon the proclamation of the President and Secretary of State made just after the assassination of President Lincoln, in which they declared specifically that the Rebellion had overthrown all civil governments in the insurrectionary states, and they proceeded by an executive mandate to create governments. They were provisional in their character, and dependent for their validity solely upon the action of Congress. These are propositions which it is not now necessary for me to demonstrate. These governments have never been sanctioned by Congress, nor by the people of the states where they exist. Taking that proclamation and the acknowledged fact that the people of the southern states, the loyal people, whites and blacks, are not protected in their rights, but that an unusual and extraordinary number of cases occur of violence, and murder, and wrong, I do think it is the duty of the United States to protect these people in the enjoyment of substantial rights.

"Now, the first four sections of this substitute contain nothing but what is the present law. There is not a single thing in the first four sections that does not now exist by law.

"The first section authorizes the division of the rebel states into military districts. That is being done daily.

"The second section acknowledges that the President is the commanding officer of the army, and it is made his duty to assign certain officers to those districts. That is clearly admitted to be right.

"The third section does no more than what the Supreme Court in their recent decision have decided could be done in a state in insurrection. The Supreme Court in their recent decisions, while denying that a military tribunal could be organized in Indiana because it never had been in a state of insurrection, expressly declared that these tribunals might have been, and might now be, organized in insurrectionary states. There is nothing in this third section, in my judgment, that is not now and has not been done every month within the last twelve months by the President of the United States. The orders of General Sickles, and many other orders I might quote, have gone further in punishment of crime than this section proposes.

"Now, in regard to the fourth section, that is a limitation upon the present law. Under the present law many executions of military tribunals are summarily carried out. This section requires all sentences of military tribunals which affect the liberty of the citizen to be sent to the commanding officer of the district. They must be approved by the commanding officer of the district; and so far as life is concerned the President may issue his order at any moment now, or after this bill passes, directing that the military commander of the district shall not enforce a sentence of death until it is submitted to him, because the military officer is a mere subordinate of the President, remaining there at the pleasure of the President.

"There is nothing, therefore, in these sections, that ought to alarm the nerves of my friend from Pennsylvania, or anybody else. I cannot think that these gentlemen are alarmed about the state of despotism that President Johnson is to establish in the southern states. I do not feel alarmed; nor do I see anything in these sections as they now stand that need endanger the rights of the most timid citizen of the United States. They are intended to protect a race of people who are now without protection.

"Now, in regard to the fifth section, which is the main and material feature of this bill, I think it is right that the Congress of the United States, before its adjournment, should designate some way by which the southern states may reorganize loyal state governments in harmony with the constitution and laws of the United States, and the sentiment of the people, and find their way back to these halls. My own judgment is that the fifth section will point out a clear, easy, and right way for these states to be restored to their full power in the government. All that it demands of the people of the southern states is to extend to all their male citizens, without distinction of race or color, the elective franchise. It is now too late in the day to be frightened by this simple proposition. Senators can make the most of it as a political proposition. Upon that we are prepared to meet them. But it does point out a way by which the twenty absent Senators, and the fifty absent Representatives can get back to these halls, and there is no other way by which they can justly do it.

"It seems to me that this is the whole substance of the bill. All there is material in the bill is in the first two lines of the preamble and the fifth section, in my judgment. The first two lines may lay the foundation adopting the proclamation issued first in North Carolina, that the Rebellion had swept away all the civil governments in the southern states; and the fifth section points out the mode by which the people of those states in their own manner, without any limitations or restrictions by Congress, may get back full representation in Congress. That is the view I take of this amended bill; and taking that view of it I see no reason in the world why we should not all vote for it."

The substitute was adopted on the same day and the bill, thus amended, was passed by a vote of yeas 29, nays 10. In the House it was agreed to with slight amendments, which were finally concurred in by the Senate, on February 20, 1867. It was sent to the President and was not approved by him, but was, on the 2nd of March, passed over his veto by a vote of two-thirds of both Houses.

Upon the law, long deferred, the several states mentioned in it were organized and restored to their place in the Union. The preamble and fifth and sixth sections of this law are as follows:

"An Act to Provide for the More Efficient Government of the Rebel States.

"Whereas, no legal state governments or adequate protection for life or property now exists in the rebel states of Virginia, North Carolina, South Carolina, Georgia, Mississippi, Alabama, Louisiana, Florida, Texas, and Arkansas; and whereas it is necessary that peace and good order should be enforced in said states until loyal and republican state governments can be legally established: Therefore,

"Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled: . . .

"Sec. 5. And be it further enacted, That when the people of any one of said rebel states shall have formed a constitution of government in conformity with the constitution of the United States in all respects, framed by a convention of delegates elected by the male citizens of said state, twenty-one years old and upward, of whatever race, color, or previous condition, who have been resident in said state for one year previous to the day of such election, except such as may be disfranchised for participation in the Rebellion, or for felony at common law, and when such constitution shall provide that the elective franchise shall be enjoyed by all such persons as have the qualifications herein stated for electors of delegates, and when such constitution shall be ratified by a majority of the persons voting on the question of ratification who are qualified as electors for delegates, and when such constitution shall have been submitted to Congress for examination and approval, and Congress shall have approved the same, and when said state, by a vote of its legislature, elected under such conditions, shall have adopted the amendment to the constitution of the United States, proposed by the 39th Congress, and known as article fourteen, and when said article shall have become a part of the constitution of the United States, said state shall be declared entitled to representation in Congress, and Senators and Representatives shall be admitted therefrom on their taking the oath prescribed by law, and then and thereafter the preceding sections of this act shall be inoperative in said state: Provided, That no person excluded from the privilege of holding office by said proposed amendment to the constitution of the United States shall be eligible to election as a member of the convention to frame a constitution for any of said rebel states, nor shall any such person vote for members of such convention.

"Sec. 6. And be it further enacted, That, until the people of said rebel states shall be by law admitted to representation in the Congress of the United States, any civil government which may exist therein shall be deemed provisional only, and in all respects subject to the paramount authority of the United States at any time to abolish, modify, control, or supersede the same; and in all elections to any office under such provisional governments all persons shall be entitled to vote, and none others, who are entitled to vote, under the provisions of the fifth section of this act; and no person shall be eligible to any office under any such provisional governments who would be disqualified from holding office under the provisions of the third article of said constitutional amendment."

At the same time, the financial question, embracing the currency, the public debt and the national revenue were of the highest importance and demanded immediate consideration. Hugh McCulloch, the Secretary of the Treasury, had been during most of his life a banker in the State of Indiana, of acknowledged ability as such, but with little or no experience as a financier dealing with public questions. He was the first comptroller of the currency under the banking act, and rendered valuable service in organizing the system of national banks, though he had not originally favored the system, but was, at the time of its adoption, a strong supporter of sound state banks. In his first report to Congress on the 4th of December, 1865, he, as Secretary of the Treasury, took strong ground against United States notes as a circulating medium and their being made a legal tender as money. He regarded the legal tender acts as war measures, and, while he did not recommend their repeal, he expressed his opinion that they ought not to remain in force one day longer than would be necessary to enable the people to prepare for a return to the constitutional currency. He denied the authority of Congress to issue these notes except in the nature of a loan, and affirmed that the statute making them a legal tender for all debts, public and private, was not within the scope of the duties or the constitutional powers of Congress; that their issue as lawful money was a measure necessary in a great emergency, but, as this emergency did not then exist, the government should, as speedily as possible, withdraw them, and he recommended that the work of retiring the notes should be commenced without delay and carefully and persistently continued until all were retired. He proposed to do this by the sale of bonds for United States notes outstanding and their withdrawal and cancellation. He recommended as a substitute the notes of national banks, but even these notes he thought redundant, and said:

"There is no fact more manifest that the plethora of paper money is not only undermining the morals of the people by encouraging waste and extravagance, but is striking at the root of our material prosperity by diminishing labor . . . and if not speedily checked, will, at no distant day, culminate in widespread disaster. The remedy, and the only remedy within the control of Congress, is, in the opinion of the secretary, to be found in the reduction of the currency."

The chief part of his report was devoted to the danger of inflation and the necessity of contraction. He said the longer contraction was delayed the greater must the fall eventually be, and the more serious its consequences.

In accordance with the recommendations of Secretary McCulloch, a bill was introduced in the House by Justin S. Morrill, which authorized the Secretary of the Treasury, at his discretion, to sell any of the description of bonds authorized by the act of March 3, 1865, the proceeds to be used only to retire treasury notes or other obligations issued under any act of Congress. This bill as reported would have placed in the power of the secretary the retirement of all United States notes at his discretion. An amendment was made in the House which provided:

"That of United States notes not more than ten millions of dollars may be retired and canceled within six months from the passage of this act, and thereafter not more than four millions of dollars in any one month."

The bill as it came to the Senate was as follows:

"An act to amend an act entitled 'An act to provide ways and means to support the government,' approved March third, eighteen hundred and sixty-five.

"Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the act entitled 'An act to provide ways and means to support the government,' approved March third, eighteen hundred and sixty-five, shall be extended and construed to authorize the Secretary of the Treasury, at his discretion, to receive any treasury notes or other obligations issued under any act of Congress, whether bearing interest or not, in exchange for any description of bonds authorized by the act to which this is an amendment; and also to dispose of any description of bonds authorized by said act, either in the United States or elsewhere, to such an amount, in such manner, and at such rates, as he may think advisable, for lawful money of the United States, or for any treasury notes, certificates of indebtedness, or certificates of deposit, or other representatives of value, which have been or which may be issued under any act of Congress, the proceeds thereof to be used only for retiring treasury notes or other obligations issued under any act of Congress; but nothing herein contained shall be construed to authorize any increase of the public debt: Provided, That of United States notes not more than ten millions of dollars may be retired and canceled within six months from the passage of this act, and thereafter not more than four millions of dollars in any one month: And provided further, That the act to which this is an amendment shall continue in full force in all its provisions, except as modified by this act.

"Sec. 2. And be it further enacted, That the Secretary of the Treasury shall report to Congress at the commencement of the next session the amount of exchanges made or money borrowed under this act, and of whom and on what terms; and also the amount and character of indebtedness retired under this act, and the act to which this is an amendment, with a detailed statement of the expense of making such loans and exchanges."

This bill, without change, became a law April 12, 1866. I believed then, and now know, that the passage of this law was a great misfortune. It enabled the Secretary of the Treasury to retire at a rapid rate United States notes and to largely increase the bonded indebtedness of the United States. It would no doubt have brought us abruptly to the specie standard and made us dependent for circulating notes upon the issues of national banks.

At this time there was a wide difference of opinion between Secretary McCulloch and myself as to the financial policy of the government in respect to the public debt and the currency. He was in favor of a rapid contraction of the currency by funding it into interest bearing bonds. I was in favor of maintaining in circulation the then existing volume of currency as an aid to the funding of all forms of interest-bearing securities into bonds redeemable within a brief period at the pleasure of the United States, and bearing as low a rate of interest as possible. Both of us were in favor of specie payments, he by contraction and I by the gradual advancement of the credit and value of our currency to the specie standard. With him specie payments was the primary object, with me it was a secondary object, to follow the advancing credit of the government. Each of us was in favor of the payment of the interest of bonds in coin, and the principal, when due, in coin. A large proportion of national securities were payable in lawful money, or United States notes. He, by contraction, would have made this payment more difficult, while I, by retaining the notes in existence, would induce the holders of currency certificates to convert them into coin obligations bearing a lower rate of interest.

CHAPTER XVII. INDEBTEDNESS OF THE UNITED STATES IN 1865. Organization of the Greenback Party--Total Debt on October 31st amounts to $2,805,549,437.55--Secretary McCulloch's Desire to Convert All United States Notes into Interest Bearing Bonds--My Discussion with Senator Fessenden Over the Finance Committee's Bill --Too Great Powers Conferred on the Secretary of the Treasury--His Desire to Retire $10,000,000 of United States Notes Each Month-- Growth of the Greenback Party--The Secretary's Powers to Reduce the Currency by Retiring or Canceling United States Notes is Suspended--Bill to Reduce Taxes and Provide Internal Revenue--My Trip to Laramie and Other Western Forts with General Sherman-- Beginning of the Department of Agriculture.

During this period a party sprang up composed of men of all parties called the Greenback party, who favored an increase of United States notes, and the payment of all United States bonds and securities in such notes. This difference of opinion continued until the resumption of specie payments, in January, 1879.

I propose to state here the measures adopted in respect to the national currency and debt during the rest of the administration of President Johnson.

The total debt of the United States on the 31st of October, 1865, was $2,808,549,437.55 in twenty-five different forms of indebtedness of which, $1,200,000,000 was payable at the option of the Secretary of the Treasury, or within a brief period. The amount of United States notes outstanding was then $428,160,569, and of fractional currency $26,057,469, in all $545,218,038. All of this money was in active circulation, in great favor among the people, worth in use as much as national bank notes, and rapidly rising in value compared with coin. It was the least burdensome form of indebtedness then existing. The treasury notes and compound interest notes were in express terms payable in this lawful money, and, therefore, bore a higher rate of interest than the bonds, which, by their express terms or necessary implication, were payable in coin only.

It was insisted that the amount of United States notes was in excess of what was needed for currency in time of peace and might safely be gradually reduced. This effort to contract the currency was firmly resisted by several Senators, myself among them. The Supreme Court decided that Congress had full power to make these notes a legal tender. They were far better than any form of currency previously existing in the United States. During the war, when the expenditures of the government reached nearly $1,000,000,000 a year they were indispensable. Those most opposed to irredeemable paper money acknowledged this necessity. The only objection to them was that they were not equivalent to coin in purchasing power. After the war was over, the general desire of all was to advance these notes nearer to par with coin, but not to withdraw them. The rising credit and financial strength of the United States would, it was believed, bring them to par without injustice to the debtor, but the rapid withdrawal of the notes would add to the burden of debts and cripple all forms of industry. It would convert the compound interest notes and treasury notes bearing seven and three tenths per cent. interest, amounting to over $1,000,000,000 expressly payable in United States notes, into coin liabilities. The bill prepared at the treasury department contemplated the conversion of all United States notes into bonds. In that form the bill was defeated in the House of Representatives, but it was reconsidered and an amendment was then made limiting the retirement of notes to $4,000,000 a month. This gained for the bill enough votes to secure its passage. Even the withdrawal of $48,000,000 a year was soon found to be oppressive and was subsequently repealed.

When this bill came before the committee on finance, I found myself alone in opposition to it. I could not impress my colleagues of the committee with the grave importance of the measure, and its wide-reaching influence upon our currency, debt and credit. They regarded it simply as a bill to change the form of our securities. I felt confident that without the use of United States notes we could not make this exchange. When the bill was brought before the Senate by Mr. Fessenden, chairman of the committee, he made no statement of its terms, but only said:

"I have merely to say that this bill is reported by the committee on finance without amendment as it came from the House of Representatives. The committee on finance, on careful examination of it, came to the conclusion that the bill was well enough as it stood, and did not deem it advisable to make any amendment. It has been before the Senate a considerable time, and I presume every Senator understands it. I ask, therefore, for the question."

I replied:

"I regret very much that I differ from the committee on finance in regard to this bill. This is the only bill on the subject of the public debt on which I have not been able to concur with that committee. . . .

"If Senators will read this bill they will find that it confers on the Secretary of the Treasury greater powers than have ever been conferred, since the foundation of this government, upon any Secretary of the Treasury. Our loan laws, heretofore, have generally been confined to the negotiation of a single loan, limited in amount. As the war progressed, the difficulties of the country became greater, and we were more in the habit of removing the limitations on the power of the Secretary of the Treasury; but generally the power conferred was confined to a particular loan then in the market. This bill, however, is more general in its terms. This bill authorizes the Secretary of the Treasury to sell any character of bonds without limit, except as to the rate of interest. The authority conferred does not limit him to any form of security. It may run for any period of time within forty years. He may sell the securities at less than par, without limitation as to rate. He may sell them in any form he chooses. He may put them in the form of treasury notes or bonds, the interest payable in gold or in paper money. He may undertake, under the provisions of this bill, to fund the whole debt of the United States. The only limit as to amount is the public debt, now $2,700,000,000. The power conferred on the Secretary of the Treasury is absolute. It is not only for this year, or during the current fiscal year, or for the next year, but it is for all time, until the act shall be repealed. It gives him absolute power to negotiate bonds of the United States to the amount of $2,700,000,000, without limiting the rate at which they shall be sold, and only limiting the rate of interest inferentially. The description of the bonds in the act of March 3, 1865, referred to here, would probably limit the rate of interest to six per cent. in coin, and seven and three- tenths per cent. in currency; but with this exception there is no limitation.

"It seems to me that in the present condition of our finances there is no necessity for conferring these large powers on the Secretary of the Treasury. The people are not generally aware of the favorable condition of our finances. The statement of the public debt laid on our tables the other day does not show fully the condition of the finances. It is accurate in amounts, but does not give dates of the maturity of our debts. But a small portion of the debt of the United States will be due prior to August, 1867, that will give the secretary any trouble. But little of the debt which he will be required to fund under the provisions of this bill matures before August, 1867. The temporary or call loan, now over one hundred millions, may readily be kept at this sum even at a reduced rate of interest. The certificates of indebtedness, amounting to sixty- two millions, may easily be paid from accruing receipts, or, if necessary, may be renewed or funded at the pleasure of the secretary. None of the compound interest notes or the seven-thirty notes mature until August, 1867. . . .

"There is, therefore, no immediate necessity for these vast powers. The question then naturally occurs, why grant them? I have carefully considered this question, and I do not think there is now any immediate necessity for granting these powers. No debt is maturing that is likely to give the government any trouble; and yet we are now about to confer upon the Secretary of the Treasury, powers that we cannot, in the nature of things, recall. It is true we may repeal this law next year, but we know very well that when these large powers are granted they are very seldom recalled; they are made the precedents of further grants of powers and are very rarely recalled. It seems to me that the whole object of the passage of this bill is to place it within the power of the Secretary of the Treasury to contract the currency of the country, and thus, as I think, to produce an unnecessary strain upon the people. This power I do not think ought to be given to him. The House of Representatives did not intend to give him this power. They debated the bill a long time, and it was defeated on the ground that they would not confer on the secretary this power to reduce the currency, and finally it was only passed with a proviso contained in the bill which I will now read:

'Provided, That of United States notes not more than $10,000,000 may be retired and canceled within six months from the passage of this act, and thereafter not more than $4,000,000 in any one month.'

"The purpose of the House of Representatives was, while giving the secretary power to fund the debt as it matured or even before maturity, giving him the most ample power over the debt of the United States, to limit his power over the currency, lest he might carry to an extreme the view presented by him in his annual report. If this proviso would accomplish the purpose designed by the House of Representatives, I would cease all opposition to this bill; but I know it will not, and for the very obvious reason, that there is no restraint upon the power of the Secretary of the Treasury to accumulate legal tender notes in the treasury. He may retire $200,000,000 of legal tender notes by retaining them in his possession without cancellation, and thus accomplish the very purpose the House of Representatives did not intend to allow him to accomplish. He may sell the bonds of the United States, at any rate he chooses, for legal tenders, and he may hold those legal tenders in his vaults, thus retiring them from the business of the country, and thus produce the very contraction which the House of Representatives meant to deny him power to do. Therefore, this proviso, which only limits the power of canceling securities or notes, does not limit his power over the currency, and he may, without violating this bill, in pursuance of the very terms of this bill, contract the currency according to his own good will and pleasure.

"My own impression is, that the Secretary of the Treasury, in carrying out his own policy, will do so. He says he will not contract it unreasonably or too rapidly, but I believe he will contract the currency in this way. He has now in the vaults of the treasury $60,000,000 in currency and $62,000,000 in gold--a larger balance, I believe, than was ever before kept in the treasury until within the last two or three months; a larger balance than was ever found in the treasury during the war. What is the object of accumulating these vast balances in the treasury? Simply to carry out his policy of contraction. With this power of retaining in the treasury the money that comes in, what does he care for the limitation put upon this bill by the House of Representatives? That says that he shall not retire and cancel more than $10,000,000 of United States notes within six months, and not more than $4,000,000 in any one month thereafter; but why need he retire and cancel them when he can retain them in the vaults of the treasury, and thus contract the currency? . . .

"I do not doubt in the least either the integrity or the capacity of the present incumbent of the treasury department. I have as much confidence in him as anyone; but this question of the currency is one that affects so intimately all the business relations of life, the property of every man in this country, his ability to pay taxes, his ability to earn food and acquire a living, that no man ought to have the power to vary the volume of currency. It ought to be regulated by law, and the law ought to be so fixed and so defined that every business man may transact his business with full knowledge of the amount of the currency, with all its limits and qualifications. I ask you, sir, how any prudent or judicious man can now engage in any important business, in which he is compelled to go into debt, with this large power hanging over him. It would be unsafe for him to do so. The amount of the currency ought to be fixed by law, whether much or little. There ought to be a limit, and no man ought to have the power at pleasure to enlarge or contract that limit. . . .

"Then there is the further power to reduce the currency, a power that has not heretofore been granted to any Secretary of the Treasury. The amount heretofore has been fixed and limited by law. By the first clause of this bill the secretary is authorized to receive treasury notes, or United States notes of any form or description, and there is no limitation to this power, except the clause which I have read to you. That limits his power to retire and cancel the United States notes, but not to accumulate the enormous balances on hand. My own impression has been, and when this bill was before the committee on finance I believed, it would be better for that committee to report to the Senate a financial project to fund the debt of the United States. I believe that now is the favorable time to do it. If a five per cent. bond, a long bond of proper description and proper guarantee, was now placed upon the market, with such ample powers to negotiate it as ought to be given to the Secretary of the Treasury, such a loan as was authorized two years ago, at a reduced rate of interest, to be exempt from taxation, I have no doubt whatever, the Secretary of the Treasury could fund every portion of the debt of the United States as it matured. . . .

"I do not like to embarrass a bill of this kind with amendments, because I know it is difficult to consider amendments of this sort, requiring an examination of figures and tables. I have prepared a bill very carefully, with a view to meet my idea, but I will not present it now in antagonism to this bill passed by the House of Representatives and the view taken by the finance committee, because I know, in the present condition of the Senate, it would not probably be fully considered. My only purpose now is to point out the fact that is perfectly clear to the mind of every sensible man who has examined this bill, that the bill as it stands does not carry out the manifest intention of the House of Representatives when they passed it, and that the proviso, limiting the power of the secretary over the legal tender currency, does not accomplish the purpose which they designed, and without which I know the bill never could have passed the House of Representatives."

Mr. Fessenden: "If the House of Representatives did not understand what they were doing when they passed this bill, it arises from the fact that they did not give the rein to their imagination, as the honorable Senator from Ohio seems to have done to his, and take it for granted that the Secretary of the Treasury had a purpose to accomplish, and that he would not hesitate to take any means in his power to accomplish it, improperly against the manifest will of Congress, against the interests of the country, and against his own interests as Secretary of the Treasury."

I replied:

"I appeal to the Senator whether that is a fair statement of my argument?"

Mr. Fessenden: "That is the way precisely that I understand it."

I said:

"That is precisely as no gentleman could have understood me. I never said that the secretary improperly would do so and so by any means. It is one of the honorable Senator's modes of stating propositions."

Mr. Fessenden: "I certainly did not mean to say that the honorable Senator supposed he designed to do so, but such seems to be the result of his argument--that the Secretary of the Treasury having the power, as he says, there is danger that he might abuse it in that precise way; else his argument amounts to nothing at all as against the bill. I certainly acquit my friend of any sort of desire or intention to throw any imputation on the Secretary of the Treasury. That he did not mean to do. . . ."

I said:

"I do not think it wise to confer on the Secretary of the Treasury the power to meet the indebtedness not accruing for a year, or two, or three years. I do not think it is necessary, in our present financial condition, to authorize him to go into market now and sell bonds at current market rates with a view to pay debts that do not mature for a year or two. I have no doubt before the five- twenty loans are due we shall retire every dollar of them at four or five per cent. interest. No one who heeds the rapid developments of new sources of wealth in this country, the enormous yield of gold now, the renewal of industry in the south, the enormous yield of cotton, the growing wealth of this country, and all the favorable prospects that are before us, doubts the ability of this government before this debt matures to reduce it to four or five per cent. interest. . . .

"The Secretary of the Treasury may sell bonds at any rate to meet debts as they accrue, but that is not the purpose of this bill."

Mr. Fessenden: "That is all the purpose there is in it."

I said:

"Then there is no necessity for it."

Mr. Fessenden: "Yes, there is. I differ from you."

I continued:

"We have here the tables before us. The honorable Senator and I know when this debt matures. . . .

"That is the power now given, and he will use the power. He may think it to his interest to retire the whole of the seven-thirties or the ten-forties; but is it wise for us to give him that power now, at the heel of the war and before things have settled down? I do not think it is.

"I repeat, I do not wish to call in question the integrity of the Secretary of the Treasury. The Senator interjects by saying we must look ahead. I have done so. The difference between us is that I anticipate that the future of this country will be hopeful, buoyant, joyous. We shall not have to beg money of foreign nations, or even of our own people, within two or three years. Our national debt will be eagerly sought for, I have no doubt. I take a hopeful view of the future. I do not wish now to cripple the industry of the country by adopting the policy of the Secretary of the Treasury, as he calls it, by reducing the currency, by crippling the operations of the government, when I think that under any probability of affairs in the future, all this debt will take care of itself. I believe that if the Secretary of the Treasury would do nothing in the world except simply sit in his chair, meet the accruing indebtedness, and issue his treasury warrants, this debt will take care of itself, and will fund itself at four or five per cent. before very long. All that I object to in this bill is the power it gives the Secretary of the Treasury over the currency, to affect the currency of the country now and to anticipate debts that are not yet due. . . .

"That is what I am afraid of, his interference to contract the currency. The honorable Senator from Maine, however, would seem to think that I impute to him a wrong motive, and therefore I corrected him when he made the remark that I seemed to suppose the secretary was doing this improperly. I think not. The Secretary of the Treasury informed us that he desired to reduce the currency, and he has been doing it as far as he could. He has been accumulating large balances. He was opposed to the proviso which has been inserted in this bill, and yielded to it only with reluctance. That is admitted on all hands, and he is not precluded either in honor or propriety from carrying out his policy if you gave him the power to do it."

This bill became a law on the 12th of April, 1866. President Johnson relied entirely upon McCulloch, and had no opinions upon financial topics.

Now, nearly thirty years after the passage of this act, it is manifest that it was far the most injurious and expensive financial measure ever enacted by Congress. It not only compelled the United States to pay the large war rates of interest for many years, but postponed specie payments until 1879. It added fully $300,000,000 of interest that might have been saved by the earlier refunding of outstanding bonds into bonds bearing four or five per cent. interest. Mr. Fessenden, then chairman of the committee on finance, committed a grave error in hastily supporting the bill, an error which I believe he greatly regretted and which, in connection with his failing health, no doubt led him to resign his position as chairman of that committee. Although our debate was rather sharp, it did not disturb our friendly relations. With McCulloch in the treasury department, nothing could be done.

If the funding clauses of this act had been limited to the conversion of compound interest notes, treasury notes bearing interest, certificates of indebtedness, and temporary loans into bonds redeemable at the pleasure of the United States after a brief time, bearing not exceeding five per cent. interest, retaining in circulation during this process of refunding all the then outstanding United States notes, the result would have been greatly beneficial to the United States, but this was not the chief object of the Secretary of the Treasury. His primary object was to convert United States notes into interest-bearing bonds, and thus force the immediate resumption of specie payments or the substitution of national bank notes for United States notes. The result of his refunding was largely to increase the amount of six per cent. bonds, the most burdensome form of security then outstanding. In October, 1865, the amount of six per cent. bonds was $920,000,000; on the 1st of July, 1868, the six per cent. bonds outstanding were $1,557,844,600. The increase of these bonds under the operation of this law was thus over $637,000,000.

The result of this policy of contraction was not only to increase the burden of the public debt, but it created serious derangement of the business of the country. It excited a strong popular opposition to the measures adopted.

The Greenback party, as it was called, grew out of this policy of contraction, and for a time threatened to carry the election of a majority of the Members of Congress. It contended practically for an unlimited issue of legal tender United States notes, and the payment of all bonds and securities in United States notes. This, however, did not disturb Secretary McCulloch. In his annual report of December 3, 1866, he again urged the policy of a further reduction of United States notes. He was not satisfied with the reduction already provided for, and recommended that the reduction should be increased from $4,000,000 a month, as contemplated by the act of April 12, 1866, to $6,000,000 a month for the fiscal year, and to $10,000,000 a month thereafter. He said:

"The policy of contracting the circulation of the government notes should be definitely and unchangeably established, and the process should go on just as rapidly as possible without producing a financial crisis or seriously embarrassing those branches of industry and trade upon which our revenues are dependent. That the policy indicated is the true and safe one, the secretary is thoroughly convinced. If it shall not be speedily adopted and rigidly, but judiciously, enforced, severe financial troubles are in store for us."

He insisted that the circulation of the country should be further reduced, not by compelling the national banks to retire their notes, but by the withdrawal of United States notes. When reminded of the great saving of interest in the issue of $400,000,000 United States notes, he answered:

"Considerations of this nature are more than counterbalanced by the discredit which attaches to the government by failing to pay its notes according to their tenor, by the bad influence of this involuntary discredit upon the public morals, and the wide departure, which a continued issue of legal tender notes involves, from the past usages, if not from the teachings of the constitution itself."

He said:

"The government cannot exercise powers not conferred by its organic law or necessary for its own preservation, nor dishonor its own engagements when able to meet them, without either shocking or demoralizing the sentiment of the people; and the fact that the indefinite continuance of the circulation of an inconvertible but still legal tender currency is so generally advocated indicates how far we have wandered from old landmarks both in finance and in ethics."

The growing opposition of the people at large to the contraction of the currency seemed to have no effect upon his mind.

He again recurs to the same subject in his annual report to Congress, in December, 1867. After stating that the United States notes, including fractional currency, had been reduced from $459,000,000 to $387,000,000, and the funded debt had been increased $684,548,800, he urged as a measure regarded by him as important, if not indispensable for national prosperity, the funding or payment of the balance of interest-bearing notes, and a continued contraction of the paper currency. He urged that the acts authorizing legal tender notes be repealed, and that the work of retiring the notes which had been issued under them should be commenced without delay, and carefully and persistently continued until all were retired.

This policy of contraction, honestly entertained and persistently urged by Secretary McCulloch in spite of growing stringency, led Congress, by the act of February 4, 1868, to suspend indefinitely the authority of the Secretary of the Treasury to make any reduction of the currency by retiring or canceling United States notes.

Who can doubt that if he had availed himself of the power given him to refund the interest-bearing notes and certificates of the United States into bonds bearing a low rate of interest, leaving the United States notes bearing no interest to circulate as money, he would have saved the government hundreds of millions of dollars? If irredeemable notes were a national dishonor, why did he not urge their redemption in coin at some fixed period and then reissue them, and maintain their redemption by a reserve in coin?

The act of February 25, 1862, under which the original United States notes were issued, provided that:

"Such United States notes shall be received the same as coin, at their par value, in payment for any loans that may be hereafter sold or negotiated by the Secretary of the Treasury, and may be reissued from time to time as the exigencies of the public interest shall require."

This provision would have maintained the parity of United States notes at par with bonds, but under the pressure of war it was deemed best by Congress, upon the recommendation of Secretary Chase, to take from the holder of United States notes the right to present them in payment for bonds after the first day of July, 1863. If this privilege, conferred originally upon United States notes, had been renewed in 1866, with the right of reissue, bonds and notes would together have advanced to par in coin. But this is what the contractionists especially opposed. They demanded the cancellation of the notes when presented, a contraction of the currency when offering our bonds. It is easy now to perceive that a conservative use of United States notes, convertible into four per cent. bonds, would have steadily advanced both notes and bonds to par in coin. But the equally erroneous opposing opinions of contractionists and expansionists delayed for many years the coming of coin resumption upon a fixed quantity of United States notes.

Among the acts of this Congress of chief importance is the act approved July 13, 1866, to reduce taxes and provide internal revenue. The passage of such an act required much labor in both Houses, but especially so in the House of Representatives, where tax bills must originate. It was a compromise measure, and, unlike previous acts, did not reach out for new objects of taxation, but selected such articles as could bear it best, and on some of these the tax was increased. A great number of articles that enter into the common consumption of the people and are classed as necessities of life were relieved from taxation. The general purpose of the bill was in time to concentrate internal taxes on such articles as spirits, tobacco and beer. The tax on incomes was continued but limited to the 30th of June, 1870. I have already stated the marked development of internal taxation, and this measure was one of the most important in the series to produce great revenue at the least cost, and of the lightest burden to the taxpayer.

Soon after the passage of the act, approved April 12, 1866, to contract the currency, I introduced a bill, "To reduce the rate of interest on the national debt and for funding the same." In view of the passage of that act I did not expect that a funding bill would meet with success, but considered it my duty to present one, and on the 22nd of May, 1866, made a speech in support of it. The bill provided for the voluntary exchange of any of the outstanding obligations of the United States for a bond running thirty years, but redeemable at the pleasure of the United States after ten years from date, bearing interest at the rate of five per cent., payable annually. On reading that speech now I find that, though I was much more confident than others of converting our maturing securities into five per cent. bonds, the general opinion then prevailing, and acted upon by the Secretary of the Treasury, was to issue six per cent. bonds as already stated. I soon found that it was idle to press the funding bill upon Congress, when it was so much occupied with reconstruction and with Andrew Johnson. The refunding and many other measures had to be postponed until a new administration came into power. Congress had unfortunately authorized the issue of six per cent. bonds for accruing liabilities, and thus postponed refunding at a lower rate of interest.

The long and exciting session of Congress that ended on the 28th day of July, 1866, left me in feeble strength and much discouraged with the state of affairs. I had arranged with General Sherman to accompany him in an official inspection of army posts on the western plains, but did not feel at liberty to leave Washington until Congress adjourned. The letter I wrote him on the 8th of July expresses my feelings as to the political situation at that time:

"United States Senate Chamber,} "Washington, July 8, 1866. } "Dear Brother:--It is now wise for you to avoid all expressions of political opinion. Congress and the President are now drifting from each other into open warfare. Congress is not weak in what it has done, but in what it has failed to do. It has adopted no unwise or extreme measures. The civil rights bill and constitutional amendments can be defended as reasonable, moderate, and in harmony with Johnson's old position and yours. As Congress has thus far failed to provide measures to allow legal Senators and Representatives to take their seats, it has failed in a plain duty. This is its weakness, but even in this it will have the sympathy of the most of the soldiers, and the people who are not too eager to secure rebel political power. As to the President, he is becoming Tylerized. He was elected by the Union party for his openly expressed radical sentiments, and now he seeks to rend to pieces this party. There is a sentiment among the people that this is dishonor. It looks so to me. What Johnson is, is from and by the Union party. He now deserts it and betrays it. He may varnish it up, but, after all, he must admit that he disappoints the reasonable expectations of those who intrusted him with power. He may, by a coalition with copperheads and rebels, succeed, but the simple fact that nine- tenths of them who voted for him do not agree with him, and that he only controls the other tenth by power intrusted to him by the Union party, will damn him forever. Besides, he is insincere; he has deceived and misled his best friends. I know he led many to believe he would agree to the civil rights bill, and nearly all who conversed with him until within a few days believed he would acquiesce in the amendments, and even aid in securing their adoption. I almost fear he contemplates civil war. Under those circumstances you, Grant and Thomas ought to be clear of political complications. As for myself, I intend to stick to finance, but wherever I can I will moderate the actions of the Union party, and favor conciliation and restoration.

"Affectionately yours, "John Sherman."

After the adjournment I proceeded to St. Louis, and with General Sherman and two staff officers, went by rail to Omaha. This handsome city had made great progress since my former visit. We then went by the Central Pacific railroad to Fort Kearney, as far as the rails were then laid. There our little party started through the Indian Territory, riding in light wagons with canvas covers, each drawn by two good army mules, escorted by a squad of mounted soldiers. We traveled about thirty miles a day, camping at night, sleeping in our wagons, turned into ambulances, the soldiers under shelter tents on blankets and the horses parked near by. The camp was guarded by sentinels at night, and the troopers lay with their guns close at hand. Almost every day we met Indians, but none that appeared to be hostile. In this way we traveled to Fort Laramie. The country traversed was an unbroken wilderness, in a state of nature, but singularly beautiful as a landscape. It was an open prairie, traversed by what was called the North Platte River, with scarcely water enough in it to be called a creek, with rolling hills on either side, and above, a clear sky, and air pure and bracing. It was the first time I had been so far out on the plains, and I enjoyed it beyond expression. I was soon able to eat my full share of the plain fare of bread and meat, and wanted more.

After many days we reached Fort Laramie, then an important post far out beyond the frontier. We remained but a few days, and then, following south along the foot hills, we crossed into the Laramie plains to Fort Sanders. This was the last post to the west in General Sherman's command. From thence we followed the course of the Cache la Poudre. On the way we camped near a station of the Overland Stage Company, for change of horses and for meals, in a charming and picturesque region. The keeper of the station soon called and inquired for me, and I found that he was a former resident of Mansfield, who married the daughter of an old friend. He invited our party to his house, and there I met his wife, who, in this region without any neighbors or habitations near, seemed to be perfectly happy and fearless, though often disturbed by threatened Indian outbreaks. We were handsomely entertained. It was a great relief to sleep one night in a comfortable bed, after sleeping for many nights with two in a narrow wagon. We then proceeded to Greeley, where we found a small settlement of farmers. From thence to Denver, we found a few cabins scattered over a vast open plain stretching as far as the eye could reach to the east, with the mountains on the west rising in grandeur and apparently presenting an insurmountable barrier. I have seen many landscapes since that were more bold and striking, but this combination of great mountains and vast plains, side by side, made an impression on my mind as lasting as any natural landscape I have seen.

At Denver, General Sherman and I were handsomely entertained by the citizens, many of whom General Sherman knew as soldiers under his command during the war, and some of whom I knew as former residents of Ohio. They were enthusiastic in their praise of Colorado. It seemed to me the air was charged with a superabundance of ozone, for everyone was so hopeful of the future of Denver, that even the want of rain did not discourage them and some of them tried to convince me that irrigation from the mountains was better than showers from the sky. Denver was then a town of less than 5,000 inhabitants and now contains more than 110,000. Colorado had less than 50,000 inhabitants in 1870, and in 1890 it had 412,198, an increase of nearly ten fold in twenty years. But this marvelous growth does not spring from the invigorating air and flowing springs of Colorado, but from the precious metals stored in untold quantities in her mountains. From Denver General Sherman had to continue his inspection to the southern posts, and I was called home to take part in the pending canvass. I started in a coach peculiar to the country, with three or four passengers, over a distance of about four hundred miles to Fort Riley, in Kansas. We had heard of many Indian forays on the line we were to travel over and there was some danger, but it was the only way to get home. Each of the passengers, I among the number, had a good Winchester rifle, with plenty of ammunition. The coach was a crude rattle-trap, noisy and rough, but strong and well adapted to the journey. It was drawn by four horses of the country, small but wiry. We had long reaches between changes. The stations for meals had means of defense, and the food set before us was substantial, mainly buffalo beef, chickens and bread. A good appetite (always a sure thing on the plains) was the best sauce for a substantial meal, and all the meals were dinners with no change of courses. We saw on the way many evidences of Indian depredations, one of which was quite recent, and two or three settlers had been killed. We met no Indians on the way, but we did meet myriads of buffaloes, scattered in vast herds to the north and south of us as far as the eye could reach. It is sad to reflect that all these animals have been exterminated, mainly in wanton sport by hunters who did not need their flesh for food or their hides for leather or robes. This destruction of buffaloes opened the way for herds of domestic cattle, which perhaps in equal numbers now feed upon the native grass of the prairies.

In a recent visit to western Nebraska and South Dakota, I saw these cattle in great numbers in good condition, cheaply cared for and sold for four cents a pound on the hoof. The owners of these cattle purchased land from settlers who had acquired title under the homestead or pre-emption laws, as suitable sites for ranches, including a permanent lake or pond for each, an indispensable requisite for a ranch. This being secured, they built houses to live in and sheds for the protection of their cattle in winter, and thus obtained practical possession, without cost or taxes, of all the government land needed for their ranges. Sad experience has convinced settlers in all the vast rainless region of the west, that they cannot produce grain with any certainty of harvesting a crop, and thousands who have made the experiment in western Kansas and Nebraska and in eastern Colorado and Wyoming have recently abandoned their improvements and their claims. It seems now that this part of our country must be given up to the herders of cattle. The Indians and buffaloes have disappeared and the "cowboys" and domestic cattle and horses have taken their place, to give way, no doubt, in time, to the farmer, when the water will be drawn from the earth by artesian wells, and life and vitality will thus be given to a soil as rich as the Kansas valley.

We reached the end of our stage ride at Fort Riley, and were glad to enter into the cars of the Kansas Pacific railroad, though they were as dirty and filthy as cars could well be. All this has been changed. Now the ride over the plains from Kansas City to Denver can be made, in a comparatively few hours, in comfort and safety.

I returned to Ohio to take my usual part in the canvass in the fall of 1866, and returned to Washington in time for the meeting of Congress on the first Monday in December.

Prior to 1862 but little attention was given by Congress to the greatest and most important industry of mankind, that of agriculture. This is especially true of the United States, where the majority of its inhabitants are engaged in farming. Agriculture has furnished the great body of our exports, yet this employment had no representative in any of the departments except a clerk in the Patent Office. The privileges granted by that bureau to inventors had no relation to work on the farm, though farming was greatly aided by invention of farm implements during the period of the war, when a million of men were drawn from their occupations into the army. This anomaly led to the passage, on the 15th of May, 1862, of the act to establish the department of agriculture. Though called a department its chief officer was a commissioner of agriculture, who was not for many years a member of the cabinet. The first commissioner, Isaac Newton, appointed by Lincoln, was a peculiar character, a Quaker of Philadelphia, a gardener rather than a farmer, but he was an earnest and active officer. The appropriations for his department were very small, but enabled him to distribute valuable seeds and cuttings, which were in great demand and of real service to farmers. I early took an active part in promoting his efforts and especially in producing him appropriations and land where he could test his experiments. He applied for authority to use that portion of Reservation No. 2 between 12th and 14th streets of the mall in Washington, then an unsightly waste without tree or shrub, but he was notified that the use of it was essentially necessary to the war department as a cattle yard. When the war was over Congress appropriated it for the use of his department. He took possession of it about the middle of April, 1865, and, though the ground was an unbroken soil of tenacious clay, he fertilized and pulverized a part of it and planted a great variety of seeds for propagation, and covered the remaining portions of it with grass and cereals. His reports increased in interest and were in great demand. His office work was done in inconvenient parts of the Patent Office, and the necessity of better accommodations was constantly pressed upon Members of Congress. I took an active interest in the subject, and offered an amendment to the civil appropriation bill to appropriate $100,000 for a suitable building for the department of agriculture on the reservation mentioned. There was a disposition in the Senate to ridicule Newton and his seeds, and Mr. Fessenden opposed the appropriation as one for an object not within the constitutional power of Congress. The amendment, however, was adopted on the 28th day of February, 1867. Newton died on the 19th of June of that year, but on the 22nd of August, John W. Stokes, as acting commissioner, entered into a contract for the erection of the building, and Horace Capron, as commissioner, completed the work within the limits of his appropriation, a rare result in the construction of a public building. The building is admirably adapted for the purposes designed. The unsightly reservation has been converted by Mr. Capron and his successors in office into one of the most beautiful parks in Washington. The department of agriculture is now represented in the cabinet, and in practical usefulness to the country is equal to any of the departments.

CHAPTER XVIII. THREE MONTHS IN EUROPE. Short Session of Congress Convened March 4, 1867--I Become Chairman of the Committee on Finance, Succeeding Senator Fessenden--Departure for Europe--Winning a Wager from a Sea Captain--Congressman Kasson's Pistol--Under Surveillance by English Officers--Impressions of John Bright, Disraeli and Other Prominent Englishmen--Visit to France, Belgium, Holland and Germany--An Audience with Bismarck--His Sympathy with the Union Cause--Wonders of the Paris Exposition--Life in Paris--Presented to the Emperor Napoleon III and the Empress Eugenie --A Dinner at the Tuileries--My Return Home--International Money Commission in Session at Paris--Correspondence with Commissioner Ruggles--His Report--Failure to Unify the Coinage of Nations-- Relative Value of Gold and Silver.

During the last session of the 39th Congress the relations between President Johnson and Congress became such that it was deemed advisable to provide by law for a session of the new Congress on the 4th of March, 1867, that being the commencement of the term for which the Members were elected.

The law, in my opinion, ought to be a permanent one, so that the will of the people, as evidenced by the elections, may be promptly responded to. But such was not the purpose of this act. The reason was that, under the claim of authority made by the President, there was a fear that he might recognize the states in insurrection before they had complied with the conditions prescribed by law for reconstruction.

In pursuance of this law the 40th Congress met on the day named.

I took the oath as Senator, my colleague, Benjamin F. Wade, president pro tem. of the Senate, administering it. I became chairman of the committee on finance by the voluntary retirement of Mr. Fessenden. I knew this had been his purpose during the session just closed. He complained of his health, and that the confinement and labor of the position he held added to his infirmity. At the same time it was agreed that the duties of the committee should be divided by referring all appropriations to a committee on appropriations, and I was to choose between the two committees. The House of Representatives had already divided the labors of the committee of ways and means, a corresponding committee to that on finance, among several committees, and the experiment had proved a success. I preferred the committee on finance, and remained its chairman until I became Secretary of the Treasury. Mr. Fessenden took the easy and pleasant position of chairman of the committee on public buildings and grounds, and held that position until he died in September, 1869. I have already expressed my opinion of his remarkable ability as a debater and as a statesman of broad and conservative views. His only fault was a hasty temper too often displayed, but as often regretted by him.

Congress adjourned on the 30th of March, to meet again on the 3rd of July. The Senate was called to a special session by proclamation of the President on the 1st day of April, 1867. It remained in session until the 20th of April and then adjourned sine die.

I did not remain until the close of the session, but about the 10th of April sailed from New York for Europe in the steamer "City of Antwerp." I went for needed rest, a change of air and scene, and had in view, as one of the attractions of the voyage, a visit to the exposition at Paris in that year. My associates on the ocean were Colonel Morrow, United States Army, and John A. Kasson, Member of Congress from Iowa, and we remained together until I left London.

I had no plan, route or business, except to go where I drifted with such companions as I met. The only limitation as to time was the duty of returning to meet the adjourned session of the Senate in July. I have no memoranda in respect to the voyage and preserved no letters about it. Still, the principal scenes and events are impressed on my mind and I will narrate them as I now recall them.

The passage on the ocean was a favorable one. We had some rain but no winds that disturbed my digestion. But few on the vessel were seasick, and these mainly so from imagination. The captain, whose name I do not recall, was a jolly Englishman, but a careful, prudent and intelligent officer. I sat by his side at his table. After leaving port we soon took our places at table for our first meal on board. He inquired of me if I was a good sailor. I told him I would be as regular in my attendance at meals as he. He laughed and said he would like to wager some wine on that. I cheerfully accepted his bet, and, true to my promise, I did not miss a meal during the voyage, while he three or four times remained at his post on deck when the air was filled with fog or the waves were high. He paid the bet near the end of the voyage, and a number of his passengers, including Morrow and Kasson, shared in the treat.

I can imagine no life more pleasing than a tranquil, but not too tranquil, sea, with a good ship well manned, with companions you like, but not too many. The quiet and rest, the view of the ocean, the sense of solitude, the possibility of danger, all these broken a little by a quiet game of whist or an interesting book--this I call happiness. All these I remember to have enjoyed on this, my fifth trip on the ocean.

In due time we arrived at Queenstown in Ireland. It was about the time a party of Irishmen, in some town in England rescued some of their countrymen from a van in charge of English constables, one or more of whom were killed or wounded. Morrow, Kasson and I concluded we would spend a few days in "Ould Ireland." Morrow and Kasson believed they were of Irish descent, though remotely so as their ancestors "fought in the Revolution." We remained in and about Cork for two or three days. We visited and kissed the Blarney Stone, saw the Lakes of Killarney, and drove or walked about the interesting environs of Cork and Queenstown. We sought no acquaintance with anyone.

We were all about the age of forty, physically sound, and both Morrow and Kasson had the military air and step of soldiers. We soon became conscious that we were under surveillance. One day an officer called at our lodgings and frankly told us that there was so much excitement about Fenian disturbances in England, and such political ferment in Ireland, that an examination of the baggage of passengers was required and he wished to examine ours. I told him who we were, and introduced him to Morrow and Kasson, and offered my trunk for inspection. They did the same, Kasson producing also a small pistol from his valise. The officer had heard of that pistol. Kasson had fired it at the birds hovering about the vessel. This had been reported to the police. The officer took the pistol and it was returned to Kasson some days after at Dublin. Morrow ridiculed the pistol and told the officer that Kasson could not hit or hurt him at ten paces away, but the officer was only half satisfied. We soon after went to Dublin, but we felt that we were under suspicion. All Americans were then suspected of sympathizing with the Irish. We told our consul at Dublin of our adventures at Cork, and he said we were lucky in not being arrested. We went to a steeple chase a few miles from Dublin, where gentlemen rode their own horses over a long and difficult route, leaping barriers and crossing streams. We enjoyed the scene very much and mingled freely in the great crowd, but always feeling that we were watched. The next day we started to cross the channel to Holyhead.

We took the steamer at Dublin Bay and found aboard a large company of well-dressed passengers, such as we would find on a summer excursion from New York. Morrow, who was a handsome man of pleasing manners and address, said he could pick out Americans from the crowd. I doubted it. He said: "There is an American," pointing out a large, well-built man, who seemed to be known by the passengers around him. I said he was an Englishman. Morrow stepped up to him and politely said that he had a wager with a friend that he was an American. "Not by a d----d sight," replied the Englishman. Morrow apologized for the intrusion, but the gentleman changed his tone and said that his abrupt answer was caused by a letter he had lately received from a nephew of his whom he had sent to America to make his fortune. His nephew had written him now that the rebels were put down, the next thing to do would be to put down "old England." Morrow said there was too much of that kind of gasconade in America, and that after our desperate struggle at home we would not be likely to engage in one with England.

We arrived safely in London. In my first visit in 1859, with my wife, we were sight-seers. Now I sought to form acquaintance with men whose names were household words in all parts of the United States. By the courtesy of our consul general at Liverpool, Thomas H. Dudley, I met John Bright, Disraeli, and many others less conspicuous in public life. I have already mentioned my breakfast with Gladstone during this visit. Mr. Dudley, then in London, invited Mr. Bright to a dinner as his principal guest. Of all the men I met in London, Mr. Bright impressed me most favorably. Finely formed physically, he was also mentally strong. He was frank and free in his talk and had none of the hesitation or reserve common with Englishmen. He was familiar with our war and had no timidity in the expression of his sympathy for the Union cause. If we ever erect a monument to an Englishman, it should be to John Bright. I heard Disraeli speak in the House of Commons and was introduced to him at a reception at Lord Stanley's. In the ten days I spent in London I saw as much of social life as could be crowded into that time. Charles Francis Adams was then United States minister at London, and I am indebted to him for many acts of kindness. When we were Members of the House of Representatives together he had the reputation of being cold and reserved and he was not popular with his fellow Members, but in London he was distinguished for his hospitality to Americans. He certainly was very kind to me, entertaining me at dinner and taking pains to introduce me to many peers and members whose names were familiar to me. While receptions are very common in London during the session, the Englishman prefers dinners as a mode of entertainment. It is then he really enjoys himself and gives pleasure to his guests. The sessions of parliament, however, interfere greatly with dinners. The great debates occur during dining hours, so that, as Mr. Adams informed me, it was difficult to arrange a dinner that would not be broken up somewhat by an unexpected debate, or a division in the House of Commons. The precedence of rank had to be carefully observed. The unsocial habit of not introducing guests to each other tended to restrain conversation and make the dinner dull and heavy. Still the forms and usages in social life in London are much like those in Washington. But here the ordinary sessions of each House of Congress terminate before six o'clock, leaving the evening hours for recreation.

The presidential mansion is the natural resort of all who visit Washington. The doors are always open to visitors at stated hours, and the President is easy of access to all who call at such hours. Formerly presidential receptions were open to all comers, and the result was a motley crowd, who formed in line and shook hands with the President, bowed to the attending ladies, passed into the great east room and gradually dispersed. In late years these receptions have become less frequent, and in their place we have had diplomatic, military and navy, and congressional receptions, for which invitations are issued. During the usual period before Lent card receptions are given by the cabinet, by many Senators and Members, and by citizens, for which invitations are issued. I know of no place where the entrance into society is so open and free as in Washington.

From London I went, by way of Dieppe and Rouen, to Paris, where my first call was on General Dix and his family. Next I visited the exposition, and wandered through and about and around it. I have attended many exhibitions, but never one before or since that combined such magnitude and completeness in size, form and location, and such simplicity in arrangement and details, as the Paris Exposition of 1867. I spent ten days in this inspection, and in walking and driving around Paris and its environs. Through the kindness of General Dix, then envoy extraordinary and minister plenipotentiary, I received invitations to many meetings and receptions given by Mayor Haussman and other officers of the French government to visitors from abroad connected with the exposition. I accepted some of them, but purposely postponed this social part of my visit until I returned from Berlin.

From Paris I went to Antwerp via Brussels. At this latter place I met Doctor John Wilson, then United States consul at Antwerp. He was an old friend at Washington, where he served during the greater part of the war as an army surgeon. He was a man of remarkable intelligence, familiar with nearly every part of Europe, and especially with France, Belgium and Prussia. He readily acquiesced in my invitation to accompany me to Berlin. On the invitation of Henry S. Sanford, our minister to Brussels, I returned to that city, and met at dinner the principal officers of Belgium, such as we designate cabinet ministers. I drove with Mr. Sanford to Waterloo and other famous historic places in and about that beautiful city.

From Brussels we went to the Hague, where General Hugh Ewing, a brother-in-law of General Sherman, was United States minister. After a brief stay in Holland, General Ewing, Doctor Wilson and myself went to Berlin. Prussia was then a kingdom of rising power, and Berlin was a growing city, but not at all the Berlin of to-day. Bismarck was recognized as a great statesman and, although far less prominent than he afterwards became, he was the one man in Germany whom I desired to see or know. Mr. Joseph A. Wright, late United States minister at Berlin, had recently died, and his son, John C. Wright, who was in charge of the legation, had no difficulty in securing me an audience with Bismarck, accompanying me to the official residence, where I was introduced to him. Bismarck spoke English with a German accent, but was easily understood. When I spoke of recent events in Europe he would turn the conversation to the United States, asking me many questions about the war and the principal generals in the opposing armies. He was in thorough sympathy with the Union cause, and emphatically said that every man in Prussia, from the king to his humblest subject, was on the side of the Union, and opposed to the Rebellion. What a pity, he said, it would have been if so great a country as the United States had been disrupted on account of slavery. I mentioned my visit to the international fair at Paris and my intention to return, and he said he would be there.

This interview, which lasted, perhaps, forty minutes, was as informal and frank as the usual conversation of friends. Bismarck was then in full health and strength, about fifty years old, more than six feet high, and a fine specimen of vigorous manhood in its prime.

I found the same feeling for the United States expressed by a popular meeting in the great exposition hall in Berlin. Our little party was escorted to this place on Sunday afternoon by Mr. Kreismann, our consul at Berlin. As we entered the hall, Mr. Kreismann advanced to the orchestra, composed of several military bands, and said something to the leader. When we took our seats at one of the numerous tables he told me to pay attention after the first item of the second part of the programme before me, and I would hear something that would please me. At the time stated, a young man advanced to the front of the stage, with a violin in his hand, and played exquisitely the air "Yankee Doodle Is the Tune," and soon after the entire band joined in, filling the great hall with American music. The intelligent German audience, many of whom knew the national airs of all countries, realized at once that this addition to the programme was a compliment to the Americans. They soon located our little party and then rose, and fully two thousand persons, men, women and children, waved their handkerchiefs and shouted for America.

The feeling in favor of the United States was then strong in all parts of Europe, except in France and England. In these countries it was somewhat divided--in France by the failure of Maximilian, and in England by the rivalry of trade, and sympathy with the south. Generally, in referring in Europe to the people of the United States, the people speak of us as Americans, while those of other parts of America are Canadians, Mexicans, etc.

After a pleasant week in Berlin I went by way of Frankfort, Wiesbaden and Cologne to Paris. The exposition was then in full operation. It may be that greater numbers attended the recent exposition at Chicago, but, great as was its success, I think, for symmetry, for plans of buildings, and arrangement of exhibits, the fair at Paris was better than that at Chicago. The French people are well adapted for such exhibits. The city of Paris is itself a good show. Its people almost live out of doors six months of the year. They are quick, mercurial, tasteful and economical. A Frenchman will live well on one-half of what is consumed or wasted by an American. I do not propose to describe the wonderful collection of the productions of nature or the works of men, but I wish to convey some idea of life in Paris during the thirty days I spent in it.

Louis Napoleon Bonaparte was then Emperor of the French, and Haussman was mayor of the city of Paris. General Dix, as before stated, was United States minister plenipotentiary and envoy extraordinary at the court of France. Upon my arrival, I hired what in Paris is called an apartment, but which includes several rooms, comprising together a comfortable residence. Many similar apartments may be in the same building, but with them you need have no communication, and you are detached from them as fully as if each apartment was a separate house. The concierge, generally a woman, takes charge of your room, orders your breakfast if you require one, and keeps the key of your apartment when you are absent. It is a charming mode of living. You can dine or lunch when you will, and are master of your time and your apartment. I employed a neat, light carriage and one horse, with a driver who knew a smattering of several languages, and found him trusty and faithful--all this at a cost that would disgust the ordinary hotel proprietor in the United States, and especially the hack driver of any of our cities. This, in Paris, was the usual outfit of a gentleman.

General Dix advised me on whom and when and how I should make my calls. My card in the usual form announced that I was "Sénateur des États Unis d'Amérique." A Parisian could not pronounce my name. The best he could do was to call me "Monsieur le Sénateur." With a few words of French I acquired, and the imperfect knowledge of English possessed by most French people, I had no difficulty in making my way in any company. I received many invitations I could not accept. I attended a reception at the Palais Royal, the residence of the mayor, dressed in the ordinary garb for evening parties, a dress coat and trousers extending to the knees, and below black silk stockings and pumps. I felt very uncomfortable in this dress when I entered the reception room, but, as I found every gentleman in the same dress, we become reconciled to it. Subsequently I attended a reception at the Tuileries, at which I was presented by General Dix to the emperor and empress.

One feature of this presentation I shall always remember. The general company had been gathered in the great hall. The diplomatic representatives of many countries were formed in line according to their rank, attended by the persons to be presented. Soon a door was opened from an adjoining room and the Emperor of the French, escorting, I think, the Empress of Russia, passed along the line and saluted the ambassadors and ministers in their order, and the ladies and gentlemen to be presented were introduced by name to the emperor. General Dix presented Fernando Wood, of New York, and myself. Following the French emperor came the Emperor of Russia escorting the Empress Eugenie of France, and the same mention of our names was made to her. Following them came kings, the Prince of Wales and others of like rank, each accompanied by distinguished peers of his country. Third or fourth in this order came the King of Prussia, Prince Bismarck, and General Von Moltke. When Bismarck passed he shook hands with Dix and recognized me with a bow and a few words. If the leaders in this pageant could have foreseen what happened three years later--that King William would be an emperor, that Bonaparte would be his prisoner and Eugenie a refugee from republican France--the order of the march would have been reversed.

Soon after this reception, I was invited by the emperor to attend, with General Dix and his daughter, a dinner at the Tuileries. Such an invitation is held to be in the nature of a command. I accompanied them, and was agreeably surprised to find that the dinner was quite informal, though more than forty sat at table. When I entered the room one of the ladies in waiting came to me and introduced me to a lady whom I was to escort to the table. Presently she returned and said: "Oh, I understand monsieur does not speak French, and marquise does not speak English. Will monsieur allow me to be a substitute?" I agreed with great pleasure. Both the guests and the hosts were promptly on time. I was introduced to the emperor and empress. She was very gracious to her guests, passing from one to another with a kindly word to all. I noticed her greeting to Miss Dix was very cordial. The emperor engaged in a conversation with me that continued until the dinner was announced,--fully ten minutes. He asked many questions about the war, and especially about General Sherman. I answered his questions as I would to any gentleman, but felt uneasy lest I was occupying time that he should bestow on others. General Dix was by my side, and encouraged the conversation. When the dinner was announced each guest knew his place from the card furnished him, and the party was seated without confusion.

I need not say that the young lady I escorted was a charming woman. I did not learn whether she was married or not, but have always regarded her action in relieving me from a silent dinner as the highest mark of politeness. She was bright and attractive, and I certainly did and said all I could to amuse her, so what I expected to be a dull dinner turned out to be a very joyful one.

It is impossible for an American to visit Paris without enjoyment and instruction. The people of Paris are always polite, especially to Americans. The debt of gratitude for the assistance of France in our War of the Revolution is never forgotten by a true American, and Frenchmen are always proud of their share in establishing the independence of America. The two Bonapartes alone did not share in this feeling. The Americans are liberal visitors in Paris. They spend their money freely, join heartily in festivities, and sympathize in the success and prosperity of the French republic. If I was not an American I certainly would be a Frenchman. I have visited Paris three times, remaining in it more than a month at each visit, and always have been received with civility and kindness. Though it is a great manufacturing city, chiefly in articles of luxury requiring the highest skill, yet it is also a most beautiful city in its location, its buildings, public and private, its museums and opera houses, its parks and squares, its wide streets and avenues, and especially the intelligence of its people. Science and art have here reached their highest development. We may copy all these, but it will require a century to develop like progress in America.

I returned to England for a few days and then took the steamer "City of Paris" for New York, where I arrived on the 13th of July. I took the cars for Washington and arrived ten days after the session had commenced.

While I was in Paris a special international commission, composed of delegates from seventeen nations, was sitting to consider, and, if possible, agree on a common unit of money for the use of the civilized world. Mr. Samuel B. Ruggles, a gentleman of the highest standing and character, was the representative of the United States on this commission. It should be remembered that at this time the only currency in circulation in the United States was the legal tender notes of the United States and the notes of national banks. Neither gold nor silver coin was in circulation, both being at a premium in currency. At this time silver bullion was at a premium over gold bullion, the legal ratio being sixteen to one. In other words, sixteen ounces of silver were worth, in the open market, three to five cents more than one ounce of gold. All parties in the United States were then looking forward to the time when United States notes would advance in value to par with gold, the cheaper metal.

The question before the commission was how to secure a common coin that would be the measure of value between all nations, and thus avoid the loss by exchange of the coins of one nation for those of another. Mr. Ruggles knew that I had studied this question, and therefore wrote this letter:

"Paris, May 17, 1867. "My Dear Sir:--You are, of course, aware that there is a special committee now in session, organized by the Imperial Commission of France, in connection with the 'Paris Exposition,' composed of delegates from many of the nations therein represented. Its object, among others, is to agree, if possible, on a common unit of money, for the use of the civilized world.

"I perceive that the opinions of the committee are running strongly in favor of adopting, as the unit, the existing French five-franc piece of gold.

"May I ask what, in your opinion, is the probability that the Congress of the United States, at an early period, would agree to reduce the weight and value of our gold dollar, to correspond with the present weight and value of the gold five-franc piece of France; and how far back such a change would commend itself to your own judgment?

"I would also ask the privilege of submitting your answer to the consideration of the committee.

"With high respect, faithfully your friend, "Samuel B. Ruggles, "U. S. Commissioner to the Paris Exposition and Member of the Committee. "Hon. John Sherman, "Chairman of the Finance Committee of the Senate of the United States, etc., etc., etc., now in Paris."

To this letter I made the following reply:

"Hotel Jardin des Tuileries, May 18, 1867. "My Dear Sir:--Your note of yesterday, inquiring whether Congress would probably, in future coinage, make our gold dollar conform in value to the gold five-franc piece, has been received.

"There has been so little discussion in Congress upon the subject that I cannot base my opinion upon anything said or done there.

"The subject has, however, excited the attention of several important commercial bodies in the United States, and the time is now so favorable that I feel quite sure that Congress will adopt any practical measure that will secure to the commercial world a uniform standard of value and exchange.

"The only question will be, how can this be accomplished?

"The treaty of December 23, 1865, between France, Italy, Belgium, and Switzerland, and the probable acquiescence in that treaty by Prussia, has laid the foundation for such a standard. If Great Britain will reduce the value of her sovereign two pence, and the United States will reduce the value of her dollar something over three cents, we then have a coinage in the franc, dollar and sovereign easily computed, and which will readily pass in all countries; the dollar as five francs and the sovereign as 25 francs.

"This will put an end to the loss and intricacies of exchange and discount.

"Our gold dollar is certainly as good a unit of value as the franc; and so the English think of their pound sterling. These coins are now exchangeable only at a considerable loss, and this exchange is a profit only to brokers and bankers. Surely each commercial nation should be willing to yield a little to secure a gold coin of equal value, weight, and diameter, from whatever mint it may have been issued.

"As the gold five-franc piece is now in use by over 60,000,000 of people of several different nationalities, and is of convenient form and size, it may well be adopted by other nations as the common standard of value, leaving to each nation to regulate the divisions of this unit in silver coin or tokens.

"If this is done France will surely abandon the impossible effort of making two standards of value. Gold coins will answer all the purpose of European commerce. A common gold standard will regulate silver coinage, of which the United States will furnish the greater part, especially for the Chinese trade.

"I have thought a good deal of how the object you propose may be most readily accomplished. It is clear that the United States cannot become a party to the treaty referred to. They could not agree upon the silver standard; nor could we limit the amount of our coinage, as proposed by the treaty. The United States is so large in extent, is so sparsely populated, and the price of labor is so much higher than in Europe, that we require more currency per capita. We now produce the larger part of the gold and silver of the world, and cannot limit our coinage except by the wants of our people and the demands of commerce.

"Congress alone can change the value of our coin. I see no object in negotiating with other powers on the subject. As coin is not now in general circulation with us, we can readily fix by law the size, weight, and measure of future issues. It is not worth while to negotiate about that which we can do without negotiation, and we do not wish to limit ourselves by treaty restrictions.

"In England many persons of influence and different chambers of commerce are earnestly in favor of the proposed change in their coinage. The change is so slight with them that an enlightened self-interest will soon induce them to make it, especially if we make the greater change in our coinage. We have some difficulty in adjusting existing contracts with the new dollar; but as contracts are now based upon the fluctuating value of paper money, even the reduced dollar in coin will be of more purchasable value than our currency.

"We can easily adjust the reduction with public creditors in the payment or conversion of their securities, while private creditors might be authorized to recover upon the old standard. All these are matters of detail to which I hope the commission will direct their attention.

"And now, my dear sir, allow me to say in conclusion that I heartily sympathize with you and the others in your efforts to secure the adoption of the metrical system of weights and measures.

"The tendency of the age is to break down all needless restrictions upon social and commercial intercourse. Nations are now as much akin to each other as provinces were of old. Prejudices disappear by contact. People of different nations learn to respect each other as they find that their differences are the effect of social and local custom, not founded upon good reasons. I trust that the industrial commission will enable the world to compute the value of all productions by the same standard, to measure by the same yard or meter, and weigh by the same scales.

"Such a result would be of greater value than the usual employments of diplomatists and statesmen.

"I am very truly yours, "John Sherman."

As the result of its investigation the commission agreed, with entire unanimity, that the gold five-franc piece should be adopted as the unit of value, and that the coins of all nations represented should be based upon that unit or multiples thereof. This would require a slight change in the quantity of gold in the dollar of the United States, amounting to a reduction of about three cents, a reduction in the pound sterling of England of about one penny, and a slight reduction or increase in the gold coins of other countries.

Mr. Ruggles reported the proceedings and recommendation of the commission to the President, and his report was referred to Congress.

A private letter to me from Mr. Ruggles, dated December 30, 1867, shows the nature of the opposition to the measure proposed, being entirely from British opposition to a change in the pound sterling. He wrote:

"New York, December 30, 1867. "My Dear Mr. Sherman:--You may have perceived, within the last week, articles in the 'New York Evening Post,' the 'New York Times' and the 'World,' on the subject of the proposed monetary unification; the first denying its propriety, the second its practicability, and the third underrating its importance.

"The articles are hastily and ignorantly and, in some respects, bitterly written. My first impulse was to briefly answer each of them in its respective newspaper. On further reflection, it seemed more decorous that, as a member of the 'conference,' I should first appear before the Senate committee now in possession of all the papers, and there render any proper explanations, and not obtrude myself as a combatant in the newspapers, prematurely and only partially defending my official action. If, however, you should think that the articles should be answered without delay, I could readily cause it to be done, by other persons.

"I cannot but think that the dignity of the subject, formally presented as it now is, to our national authorities, by a diplomatic assemblage representing nearly all the civilized nations of the Christian world, entitles it to a full discussion before the Senate committee, to be followed by a maturely considered report, fairly weighing and presenting to the country all the merits and demerits, facilities and difficulties of the measure.

"I am just at the moment confined to my house by an 'influenza,' but if I can be of any service, either before the committee or elsewhere, I shall hold myself subject to your official call, for any duty, after the 7th or 8th of January, which you may indicate.

"You must have perceived that my report to the department of state, having in view the possibility of European readers, abstained from some considerations which might properly be brought to the notice of the committee of the American Senate.

"It is strange, indeed, to see American newspapers eagerly maintaining the inviolability of the 'pound sterling,' when it has become entirely evident that the great monetary struggle of the future must lie between the British pound and the American dollar. In truth, this was virtually admitted in the 'conference' by Mr. Graham, one of the British delegates, and master of the royal mint.

"With high regard, faithfully yours, "Samuel B. Ruggles. "Hon. John Sherman, "Chairman Senate Finance Comittee, etc., etc., etc."

We were called upon to legislate upon the subject. The French government promptly acquiesced in the coin proposed. Mr. Ruggles' report said that several governments had already assented to it. The report was referred to the committee on finance of the Senate, who submitted a favorable report with a bill to carry out the recommendations, and that report was published. There was no dissent from the plan except that Senator Morgan, of New York, thought it would interfere with the profit of New York brokers in changing dollars into pounds. As a matter of course, it would have interfered with the exchanges of New York and London, the great money centers of the world. It would have interfered with bullion dealers who make profit in exchanging coins; but the whole of it was for the benefit of each country.

No man can estimate the benefit it would have conferred upon our own people. It was only defeated by the refusal of Great Britain to assent to the change of her pound sterling by the reduction of its value about one penny. But pride in the existing coins, so strong in that country, defeated the measure, although it had been assented to by her representatives in that monetary congress; and so the thing ended.

It is easy now to perceive that if this international coin had been agreed to it would have passed current everywhere, as it could rapidly be exchanged at sight without going through the hands of brokers. I do not believe that Mr. Morgan would have insisted on his opposition, as the only ground of his objection was, it would have destroyed the business of the money changers of New York. Even his resistance would have been ineffectual, as the committee and the Senate were decidedly in favor of the bill and the opposition of New York brokers would have added strength to the measure.

The greatest statesmen of Europe and America have sought for many years to unify the coinage of nations, and to adopt common standards of weights and measures, so that commerce may be freed from the restrictions now imposed upon it, but Great Britain has steadily opposed all these enlightened measures, and thus far has been able to defeat them.

My report from the committee on finance, made to the Senate June 7, 1868, contains a full statement of the acts of the monetary conference at Paris, and of the approval of its action by many of the countries there represented, and of the support given to the plan in Great Britain by many of her ablest statesmen and the great body of her commercial classes, but the party then in power in parliament refused its sanction, and thus, as already stated, the measure failed.

It has been quite common, during recent discussion about silver, to attribute the alleged demonetization of that metal to the action of the Paris monetary conference. In 1867, when this conference was in session, as already stated, sixteen ounces of silver were worth more than one ounce of gold. Fifteen and one-half ounces of silver were the legal equivalent of one ounce of gold in all European countries. No suggestion was made or entertained to disturb the circulation of silver. The only object sought was to secure some common coin by which other coins could be easily measured. As gold was the most valuable metal in smallest space, and the five-franc gold piece of France was the best unit by which other coins could be measured, other gold coins were to be multiples of the unit, so that five francs would be a dollar and five dollars would be a pound. The coins of other nations would be made to conform to multiples of this unit.

It was perfectly understood that, while silver was the chief coin in domestic exchanges in every country, it was not convenient for foreign commerce, owing to its bulk. The ratio between gold and silver was purely a domestic matter, to be determined by each country for itself. It is apparent that the chief cause of the fall of the market value of silver is its increased production. This affects the price of every commodity, cotton, corn, or wheat as well as silver. The law of supply and demand regulates value. It is the "higher law" more potent than acts of Congress. If the supply is in excess of demand the price will fall, in spite of legislation. The most striking evidence of this was furnished by our recent legislation by which we purchased over 400,000,000 ounces of silver at its market value and hoarded it, and yet the price of it steadily declined. We can coin it into silver dollars, but we can keep these dollars at par with gold only be receiving them as the equal of gold when offered.

CHAPTER XIX. IMPEACHMENT OF ANDREW JOHNSON. Judiciary Committee's Resolution Fails of Adoption by a Vote of 57 Yeas to 108 Nays--Johnson's Attempt to Remove Secretary Stanton and Create a New Office for General Sherman--Correspondence on the Subject--Report of the Committee on Impeachment, and Other Matters Pertaining to the Appointment of Lorenzo Thomas--Impeachment Resolution Passed by the House by a Vote of 126 Yeas to 47 Nays-- Johnson's Trial by the Senate--Acquittal of the President by a Vote of 35 Guilty to 19 Not Guilty--Why I Favored Conviction--General Schofield Becomes Secretary of War--"Tenure of Office Act."

During the spring and summer of 1867 the question of impeaching Andrew Johnson, President of the United States, was frequently discussed in the House of Representatives. The resolutions relating to his impeachment were introduced by James M. Ashley, of Ohio, on the 7th of March, 1867, and they were adopted on the same day. These resolutions instructed the judiciary committee, when appointed, to continue the inquiry, previously ordered, into certain charges preferred against the President of the United States, with authority to sit during the sessions of the House, and during any recess the Congress might take.

On the 25th of November, 1867, a majority of the committee on the judiciary reported a resolution of impeachment, as follows:

"Resolved, That Andrew Johnson, President of the United States, be impeached of high crimes and misdemeanors."

This resolution was accompanied by a long report and the testimony, all of which was ordered to be printed, and made the special order for Wednesday, December 4, 1867. James F. Wilson, of Iowa, made a minority report against the resolution of impeachment, signed by himself and Frederick E. Woodbridge, of Vermont. Samuel S. Marshall, of Illinois, also made a minority report in behalf of himself and Charles A. Eldridge, of Wisconsin.

On the 7th of December, the resolution of impeachment reported by the committee on the judiciary at the previous session was disagreed to by a vote of 57 yeas and 108 nays. This decision of the House of Representatives against an impeachment on the charges then made was entirely justified. This imposing process was not authorized for misconduct, immorality, intoxication or neglect of duties, such as were alleged in the report of the committee, but only for high crimes or misdemeanors. The House properly made this distinction, and here the accusations against the President would have ended, but for his attempt, in violation of the constitution and law, to place General Lorenzo Thomas in an important office without the advice and consent of the Senate, then in session.

In the latter part of 1867, and the early part of 1868, I became involved in a controversy, between President Johnson, General Grant and General Sherman, which caused the last-named serious embarrassment. As much of the correspondence between these parties has been published in the "Sherman Letters," I at first thought it best not to make any reference to the matter, but upon reflection, and to explain subsequent events, I insert the letters in their order.

General Sherman was summoned to Washington, by the President, and upon his arrival there wrote me the following letter:

"Washington, October 11, 1867. "Dear Brother:--I have no doubt that you have been duly concerned about my being summoned to Washington.

"It was imprudently done by the President without going through Grant. But I think I have smoothed it over so that Grant does not feel hurt. I cannot place myself in a situation even partially antagonistic with Grant. We must work together. Mr. Johnson has not offered me anything, only has talked over every subject, and because I listen to him patiently, and make short and decisive answers, he says he would like to have me here. Still he does not oppose my going back home. . . .

"On Monday I will start for St. Louis by the Atlantic and G. W. road, and pass Mansfield Tuesday. Can't you meet me and ride some miles? I have been away from home so much, and must go right along to Fort Laramie, that I cannot well stop at Cleveland or Mansfield, and would like to see you for an hour or so to hear your views of the coming events. . . .

"Yours affectionately, "W. T. Sherman."

And on his return to St. Louis he continues:

. . . "I have always talked kindly to the President, and have advised Grant to do so. I do think that it is best for all hands that his administration be allowed to run out its course without threatened or attempted violence. Whoever begins violent proceedings will lose in the long run. Johnson is not a man of action but of theory, and so long as your party is in doubt as to the true mode of procedure, it would be at great risk that an attempt be made to displease the President by a simple law of Congress. This is as much as I have ever said to anybody. I have never, by word or inference, given anybody the right to class me in opposition to, or in support of, Congress. On the contrary, I told Mr. Johnson that from the nature of things he could not dispense with a Congress to make laws and appropriate money, and suggested to him to receive and make overtures to such men as Fessenden, Trumbull, Sherman, Morgan, and Morton, who, though differing with him in abstract views of constitutional law and practice, were not destructive. That if the congressional plan of reconstruction succeeded, he could do nothing, and if it failed or led to confusion, the future developed results in his favor, etc.; and that is pretty much all I have ever said or done. At the meeting of the society of the army of the Tennessee on the 13th inst., I will be forced to speak, if here, and though I can confine myself purely to the military events of the past, I can make the opportunity of stating that in no event will I be drawn into the complications of the civil politics of this country.

"If Congress could meet and confine itself to current and committee business, I feel certain that everything will work along quietly till the nominations are made, and a new presidential election will likely settle the principle if negroes are to be voters in the states without the consent of the whites. This is more a question of prejudice than principle, but a voter has as much right to his prejudices as to his vote. . . ."

I answered:

"Mansfield, Ohio, November 1, 1867. "Dear Brother:-- . . . I see no real occasion for trouble with Johnson. The great error of his life was in not acquiescing in and supporting the 14th amendment of the constitution in the 39th Congress. This he could easily have carried. It referred the suffrage question to each state, and if adopted long ago the whole controversy would have culminated; or, if further opposed by the extreme radicals, they would have been easily beaten. Now I see nothing short of universal suffrage and universal amnesty as the basis. When you come on, I suggest that you give out that you go on to make your annual report and settle Indian affairs. Give us notice when you will be on, and come directly to my house, where we will make you one of the family.

"Grant, I think, is inevitably the candidate. He allows himself to drift into a position where he can't decline if he would, and I feel sure he don't want to decline. My judgment is that Chase is better for the country and for Grant himself, but I will not quarrel with what I cannot control.

"John Sherman."

And later I wrote:--

"If you can keep free from committals to Johnson, you will surely as you live be called upon to act as President. The danger now is that the mistakes of the Republicans may drift the Democratic party into power. If so, the Rebellion is triumphant, and no man active in suppressing it will be treated or honored. Grant is not injured by his correspondence with Johnson, but no doubt feels annoyed. . . ."

At this time President Johnson had come to open disagreement with Mr. Stanton, his Secretary of War, and wished to force him from the cabinet. Mr. Stanton had refused to resign and had been upheld by Congress. The President then turned for help in his difficulties to General Grant, commanding the army; but the latter found that any interference on his part would be illegal and impossible.

Mr. Johnson then planned to create a new office for General Sherman, that of brevet general of the army, in order to bring him to Washington.

The following letters and telegrams refer to this difficulty:

"(Confidential.) "Library Room, War Department, } "Washington, D. C., January 31, 1868.} "To the President:--Since our interview of yesterday I have given the subject of our conversation all my thoughts, and I beg you will pardon my reducing the result to writing.

"My personal preferences, if expressed, were to be allowed to return to St. Louis to resume my present command, because my command was important, large, suited to my rank and inclination, and because my family was well provided for there, in house facilities, schools, living, and agreeable society.

"Whilst, on the other hand, Washington was for many (to me) good reasons highly objectionable. Especially because it is the political capital of the country and focus of intrigue, gossip, and slander. Your personal preferences were, as expressed, to make a new department east adequate to my rank, with headquarters at Washington, and to assign me to its command--to remove my family here, and to avail myself of its schools, etc.; to remove Mr. Stanton from his office as Secretary of War, and have me to discharge the duties.

"To effect this removal two modes were indicated: To simply cause him to quit the war office building and notify the treasury department and the army staff departments no longer to respect him as Secretary or War; or to remove him, and submit my name to the Senate for confirmation. Permit me to discuss these points a little, and I will premise by saying that I have spoken to no one on the subject, and have not even seen Mr. Ewing, Mr. Stanbery, or General Grant since I was with you.

"It has been the rule and custom of our army, since the organization of the government, that the officer of the army second in rank should be in command at the second place in importance, and remote from general headquarters. To bring me to Washington would put three heads to an army,--yourself, General Grant, and myself,--and we would be more than human if we were not to differ. In my judgment it would ruin the army, and would be fatal to one or two of us.

"Generals Scott and Taylor proved themselves soldiers and patriots in the field, but Washington was fatal to them both. This city and the influences that centered here defeated every army that had its head here from 1861 to 1865, and would have overwhelmed General Grant at Spottsylvania and Petersburg, had he not been fortified by a strong reputation already hard earned, and because no one then living coveted the place. Whereas in the west we made progress from the start, because there was no political capital near enough to poison our minds and kindle into light that craving itching for fame which has killed more good men than battles. I have been with General Grant in the midst of death and slaughter--when the howls of people reached him after Shiloh; when messengers were speeding to and fro, between his army and Washington, bearing slanders to induce his removal before he took Vicksburg; in Chattanooga, when the soldiers were stealing the corn of the starving mules to satisfy their own hunger; at Nashville, when he was ordered to the 'forlorn hope' to command the army of the Potomac, so often defeated--and yet I never saw him more troubled than since he has been in Washington, and has been compelled to read himself a 'sneak and deceiver,' based on reports of four of the cabinet, and apparently with your knowledge. If this political atmosphere can disturb the equanimity of one so guarded and so prudent as he is, what will be the result with one so careless, so outspoken, as I am? Therefore, with my consent, Washington never.

"As to the Secretary of War, his office is twofold. As cabinet officer he should not be there without your hearty, cheerful consent, and I believe that is the judgment and opinion of every fair-minded man. As the holder of a civil office, having the supervision of money appropriated by Congress, and of contracts for army supplies, I do think Congress, or the Senate by delegation from Congress, has a lawful right to be consulted. At all events, I would not risk a suit or contest on that phase of the question. The law of Congress of March 2, 1867, prescribing the manner in which orders and instructions relating to 'military movements' shall reach the army, gives you, as constitutional commander in chief, the very power you want to exercise, and enables you to prevent the secretary from making any such orders and instructions, and consequently he cannot control the army, but is limited and restricted to a duty that an auditor of the treasury could perform. You certainly can afford to await the result. The executive power is not weakened, but, rather, strengthened. Surely he is not such an obstruction as would warrant violence or even a show of force which could produce the very reaction and clamor that he hopes for, to save him from the absurdity of holding an empty office 'for the safety of the country.'

"With great respect, yours truly, "W. T. Sherman."

"Headquarters Military Division of the Missouri,} "St. Louis, Mo., February 14, 1868. } "To the President:

"Dear Sir:--It is hard for me to conceive you would purposely do me an unkindness, unless under the pressure of a sense of public duty, or because you do not believe me sincere.

"I was in hopes, since my letter to you of the 31st of January, that you had concluded to pass over that purpose of yours, expressed more than once in conversation, to organize a new command for me in the east, with headquarters in Washington; but a telegram, from General Grant, of yesterday, says that 'the order was issued ordering you' (me) 'to Atlantic division;' and the newspapers of this morning contain the same information, with the addition that I have been nominated as 'brevet general.' I have telegraphed to my own brother in the Senate to oppose my nomination, on the ground that the two higher grades in the army ought not to be complicated with brevets, and I trust you will conceive my motives aright. If I could see my way clear to maintain my family, I should not hesitate a moment to resign my present commission and seek some business wherein I would be free from those unhappy complications that seem to be closing about me, in spite of my earnest efforts to avoid them; but necessity ties my hands, and I submit with the best grace I can, till I make other arrangements.

"In Washington are already the headquarters of a department, and of the army itself, and it is hard for me to see wherein I can render military service there. Any staff officer with the rank of major could surely fill any gap left between those two military offices; and by being placed at Washington I shall be universally construed as a rival to the general in chief, a position damaging to me in the highest degree. Our relations have always been most confidential and friendly, and if, unhappily, any cloud of difficulty should arise between us, my sense of personal dignity and duty would leave me no alternative but resignation. For this I am not yet prepared, but I shall proceed to arrange for it as rapidly as possible, that when the time does come (as it surely will if this plan is carried into effect), I may act promptly.

"Inasmuch as the order is now issued, I cannot expect a full revocation of it, but I beg the privilege of taking post at New York, or at any point you may name, within the new military division, other than Washington.

"This privilege is generally granted to all military commanders, and I can see no good reasons why I, too, may not ask for it; and this simple concession, involving no public interest, will much soften the blow which, right or wrong, I construe as one of the hardest I have sustained in a life somewhat checkered with adversity.

"With great respect, yours truly, (Signed) "W. T. Sherman, Lieutenant General."

"Headquarters Military Division of Missouri,} "St. Louis, February 14, 1868. } "Dear Brother:-- . . . I am again in the midst of trouble, occasioned by a telegram from Grant saying that the order is out for me to come to the command of the military division of the Atlantic, headquarters at Washington. The President repeatedly asked me to accept of some such position, but I thought I had fought it off successfully, though he again and again reverted to it.

"Now, it seems, he has ordered it, and it is full of trouble for me. I wrote him one or two letters in Washington, which I though positive enough, but have now written another, and if it fails in its object I might as well cast about for new employment. The result would be certain conflict, resulting in Grant's violent deposition, mine, or the President's.

"There is not room on board of one ship for more than one captain.

"If Grant intends to run for President I should be willing to come on, because my duties would then be so clearly defined that I think I could steer clear of the breakers--but now it would be impossible. The President would make use of me to beget violence, a condition of things that ought not to exist now.

"He has no right to use us for such purposes, though he is commander in chief. I did suppose his passage with Grant would end there, but now it seems he will fight him as he has been doing Congress. I don't object if he does so himself and don't rope me in. . . .

"If the President forces me into a false position out of seeming favor, I must defend myself. It is mortifying, but none the less inevitable.

"Affectionately, "W. T. Sherman."

(Telegram.) "Washington, February 14, 1868. "From St. Louis, February 14, 1868. "To General U. S. Grant, Commander U. S. Army:

"Your dispatch informing me that the order for the Atlantic division was issued, and that I was assigned to its command, is received.

"I was in hopes I had escaped the danger, and now, were I prepared, should resign on the spot, as it requires no foresight to predict such must be the inevitable result in the end.

"I will make one more desperate effort by mail, which please await.

(Signed) "W. T. Sherman, Lieutenant General."

(Telegram.) "Dated St. Louis, February 14, 1868. "Received at House of Representatives, February 14. "To Hon. John Sherman:

"Oppose confirmation of myself as brevet general on ground that it is unprecedented, and that it is better not to extend the system of brevets above major general. If I can't avoid coming to Washington I may have to resign.

"W. T. Sherman, Lieutenant-General."

This correspondence, some of which was published, excited a great deal of attention, and I received many letters in regard to it, one of which I insert:

"Washington, D. C., February 17, 1868. "Dear Sherman:--How nobly and magnanimously your gallant brother has acted. If A. J. was not callous to all that would affect gentlemen generally, he would feel this rebuke stingingly. But since he has betrayed the men who elected him he is proof against such things.

"Yours very truly, "Schuyler Colfax."

Upon the receipt of General Sherman's telegram I requested the committee on military affairs to take no action upon his nomination, as he did not desire, and would not accept, the proposed compliment. This correspondence then followed:

"Headquarters Military Division of the Missouri.} "St. Louis, Mo., February 17, 1868. } "Dear Brother:-- . . . I have not yet got the order for the Atlantic division, but it is coming by mail, and when received I must act. I have asked the President to let me make my headquarters at New York, instead of Washington, making my application of the ground that my simply being in Washington will be universally construed as rivalry to General Grant, a position which would be damaging to me in the extreme.

"If I must come to Washington, it will be with a degree of reluctance never before experienced. I would leave my family here on the supposition that the change was temporary. I do not question the President's right to make the new division, and I think Congress would make a mistake to qualify his right. It would suffice for them to nonconfirm the brevet of general. I will notify you by telegraph when the matter is concluded.

"Affectionately, "W. T. Sherman."

(Telegram.) "Received Washington, February 20, 1868. "From St. Louis, Mo., February 20, 1868. "To General U. S. Grant:

"The President telegraphs that I may remain in my present command. I write him a letter of thanks through you to-day. Congress should not have for publication my letters to the President, unless the President himself chooses to give them.

(Signed) "W. T. Sherman, Lieut. General."

"Headquarters Army of the United States.} "Washington, February 21, 1868. } "Dear Sir:--By General Grant's direction I inclose a copy of a dispatch from General Sherman, seeming to indicate his preference that the correspondence in question should not now be made public.

"Respectfully yours, "C. B. Comstock, B. B. S. "Hon. John Sherman, United States Senate."

A few days after this, General Sherman went to Washington in response to the President's order, and while there had several interviews with the President relating to the change of his command. He objected very strongly, as has been seen, to any such change, because he felt that he could not hold a command in Washington without interfering with Grant's interests, and because he had a rooted objection to living in Washington in the midst of the turmoil of politics. These objections were embodied in three letters which General Sherman wrote and showed to Grant before he sent them to the President. One of them found its way into the public press, and created a disturbance which called forth the following letters:

"Headquarters Army of the United States,} "Washington, D. C., February 22, 1868. } "Hon. J. Sherman, United States Senate.

"Dear Sir:--The 'National Intelligencer' of this morning contains a private note which General Sherman sent to the President whilst he was in Washington, dictated by the purest kindness and a disposition to preserve harmony, and not intended for publication. It seems to me that the publication of that letter is calculated to place the general in a wrong light before the public, taken in connection with what correspondents have said before, evidently getting their inspiration from the White House.

"As General Sherman afterwards wrote a semi-official note to the President, furnishing me a copy, and still later a purely official one sent through me, which placed him in his true position, and which have not been published, though called for by the 'House,' I take the liberty of sending you these letters to give you the opportunity of consulting General Sherman as to what action to take upon them. In all matters where I am not personally interested, I would not hesitate to advise General Sherman how I would act in his place. But in this instance, after the correspondence I have had with Mr. Johnson, I may not see General Sherman's interest in the same light that others see it, or that I would see it in if no such correspondence had occurred. I am clear in this, however, the correspondence here inclosed to you should not be made public except by the President, or with the full sanction of General Sherman. Probably the letter of the 31st of January, marked 'confidential,' should not be given out at all.

"Yours truly, "U. S. Grant."

The following letter was addressed to the "National Intelligencer," a Washington newspaper:

"United States Senate Chamber, } "Washington, February 22, 1868.} "Gentlemen:--The publication in your paper yesterday of General Sherman's note to the President, and its simultaneous transmission by telegraph, unaccompanied by subsequent letters withheld by the President because they were 'private,' is so unfair as to justify severe censure upon the person who furnished you this letter, whoever he may be. Upon its face it is an informal private note dictated by the purest motives--a desire to preserve harmony--and not intended for publication. How any gentleman receiving such a note could first allow vague but false suggestions of its contents to be given out, and then print it, and withhold other letters because they were 'private,' with a view to create the impression that General Sherman, in referring to ulterior measures, suggested the violent expulsion of a high officer from his office, passes my comprehension. Still I know that General Sherman is so sensitive upon questions of official propriety in publishing papers, that he would rather suffer from this false inference than correct it by publishing another private note, and as I know that this letter was not the only one written by General Sherman to the President about Mr. Stanton, I applied to the President for his consent to publish subsequent letters. This consent was freely given by the President, and I therefore send copies to you and ask their publication.

"These copies are furnished me from official sources; for while I know General Sherman's opinions, yet he did not show me either of the letters to the President, during his stay here, nervously anxious to promote harmony, to avoid strife, and certainly never suggested or countenanced resistance to law--or violence in any form. He no doubt left Washington with his old repugnance to politics, politicians, and newspapers very much increased by his visit here.

"John Sherman."

"United States Senate Chamber, February 23, 1868. "Dear Brother:--I received your letters and telegrams, and did not answer because events were moving so rapidly that I could say nothing but might be upset before you got the letter.

"Now you can congratulate yourself upon being clear of the worst complications we have ever had. Impeachment seems to be a forgone conclusion so far as the House of Representatives is concerned, based upon the alleged forcible expulsion of Stanton. No one disputes the right of the President to raise a question of law upon his right to remove Stanton, but the forcible removal of a man in office, claiming to be in lawfully, is like the forcible ejectment of a tenant when his right of possession is in dispute. It is a trespass, an assault, a riot, or a crime, according to the result of the force. It is strange the President can contemplate such a thing, when Stanton is already stripped of power, and the courts are open to the President to try his right of removal. The President is acting very badly with respect to you. He creates the impression that you acted disingenuously with him. He has published your short private note before you went to Annapolis, and yet refuses to publish your formal one subsequently sent to him, because it was 'private.' The truth is, he is a slave to his passions and resentments. No man can confide in him, and you ought to feel happy at your extrication from all near connection with him. . . . Grant is anxious to have your letters published, since the note referred to was published. I will see Grant and the President this evening, and if the latter freely consents, I will do it informally; but if he doubts or hesitates, I will not without your expressed directions. In these times of loose confidence, it is better to submit for a time to a wrong construction, than to betray confidential communications. Grant will, unquestionably, be nominated. Chase acquiesces, and I see no reason to doubt his election. . . .

"Affectionately, "John Sherman."

"Headquarters Military Division of the Missouri.} "St. Louis, Mo., February 25, 1868. } "Dear Brother:-- . . . I am in possession of all the news up to date--the passage of the impeachment resolution, etc.--but I yet don't know if the nomination of T. Ewing, Senior, was a real thing or meant to compromise a difficulty.

"The publication of my short note of January 18, is nothing to me. I have the original draft which I sent through Grant's hands, with his indorsement back to me. At the time this note must have been given to the reporter, the President had an elaborate letter from me, in which I discussed the whole case, and advised against the very course he has pursued, but I don't want that letter or any other to be drawn out to complicate a case already bad enough.

"You may always safely represent me by saying that I will not make up a final opinion until called on to act, and I want nothing to do with these controversies until the time comes for the actual fight, which I hope to God may be avoided. If the Democratic party intend to fight on this impeachment, which I believe they do not, you may count 200,000 men against you in the south. The negroes are no match for them. On this question, the whites there will be more united than on the old issue of union and secession. I do not think the President should be suspended during trial, and, if possible, the Republican party should not vote on all side questions as a unit. They should act as judges, and not as partisans. The vote in the House, being a strictly party vote, looks bad, for it augurs a prejudiced jury. Those who adhere closest to the law in this crisis are the best patriots. Whilst the floating politicians here share the excitement at Washington, the people generally manifest little interest in the game going on at Washington. . . .

"Affectionately yours, "W. T. Sherman."

"United States Senate Chamber.} "Washington, March 1, 1868. } "Dear Brother:--Your letter of the 25th is received. I need not say to you that the new events transpiring here are narrowly watched by me. So far as I am concerned, I mean to give Johnson a fair and impartial trial, and to decide nothing until required to do so, and after full argument. I regard him as a foolish and stubborn man, doing even right things in a wrong way, and in a position where the evil that he does is immensely increased by his manner of doing it. He clearly designed to have first Grant, and then you, involved in Lorenzo Thomas' position, and in this he is actuated by his recent revolt against Stanton. How easy it would have been, if he had followed your advice, to have made Stanton anxious to resign, or what is worse, to have made his position ridiculous. By his infernal folly we are drifting into turbulent waters. The only way is to keep cool and act conscientiously. I congratulate you on your lucky extrication. I do not anticipate civil war, for our proceeding is unquestionably lawful, and if the judgment is against the President, his term is just as clearly out as if the 4th of March, 1869, was come. The result, if he is convicted, would cast the undivided responsibility of reconstruction upon the Republican party, and would unquestionably secure the full admission of all the states by July next, and avoid the dangerous questions that may otherwise arise out of the southern vote in the Presidential election. It is now clear that Grant will be a candidate, and his election seems quite as clear. The action of North Carolina removed the last doubt of his nomination.

"Affectionately yours, "John Sherman."

"Headquarters Military Division of the Missouri,} "St. Louis, March 14, 1868. } "Dear Brother:--I don't know what Grant means by his silence in the midst of the very great indications of his receiving the nomination in May. Doubtless he intends to hold aloof from the expression of any opinion, till the actual nomination is made, when, if he accepts with a strong radical platform, I shall be surprised. My notion is that he thinks that the Democrats ought not to succeed to power, and that he would be willing to stand a sacrifice rather than see that result. . . . I notice that you Republicans have divided on some of the side questions on impeachment, and am glad that you concede to the President the largest limits in his defense that are offered. I don't see what the Republicans can gain by shoving matters to an extent that looks like a foregone conclusion.

"No matter what men may think of Mr. Johnson, his office is one that ought to have a pretty wide latitude of opinion. Nevertheless, the trial is one that will be closely and sternly criticised by all the civilized world. . . .

"Your brother, "W. T. Sherman."

At this time I wrote from Washington:

"You notice the impeachment proceedings have commenced. As a matter of course, I have nothing to say about them. It is strange that they have so little effect on prices and business. The struggle has been so long that the effect has been discounted. . . .

"The President was very anxious to send you to Louisiana, and only gave it up by reason of your Indian command. He might think that your visit to Europe now was not consistent with the reason given for your remaining at St. Louis. Still, on this point you could readily ask his opinion, and if that agrees with Grant's you need feel no delicacy in going. No more favorable opportunity or time to visit Europe will likely occur. . . ."

General Sherman replied:

"I hardly know what to think of the impeachment. Was in hopes Mr. Johnson would be allowed to live out his term, and doubt if any good will result by a change for the few months still remaining of his term. A new cabinet, and the changes foreshadowed by Wade's friends, though natural enough, would have insufficient time to do any good. I have a private letter from Grant as late as March 18, but he says not a word of his political intentions. So far as I know, he would yet be glad of a change that would enable him to remain as now. . . ."

On the 27th of February, 1868, Mr. Stevens made the following report:

"The committee on reconstruction, to whom was referred, on the 27th of January last, the following resolution:

'Resolved, That the committee on reconstruction be authorized to inquire what combinations have been made or attempted to be made to obstruct the due execution of the laws; and to that end the committee have powers to send for persons and papers, and to examine witnesses on oath, and report to this House what action, if any, they may deem necessary; and that said committee have leave to report at any time.'

"And to whom was also referred, on the 21st day of February, instant, a communication from Hon. Edwin M. Stanton, Secretary of War, dated on said 21st day of February, together with a copy of a letter from Andrew Johnson, President of the United States, to the said Edwin M. Stanton, as follows:

'Executive Mansion, } 'Washington, D. C., February 21, 1868.} 'Sir:--By virtue of the power and authority vested in me, as President, by the constitution and laws of the United States, you are hereby removed from office as secretary for the department of war, and your functions as such will terminate upon the receipt of this communication.

'You will transfer to Brevet Major General Lorenzo Thomas, Adjutant General of the Army, who has this day been authorized and empowered to act as Secretary of War ad interim, all records, books, papers, and other public property now in your custody and charge.

'Respectfully yours, 'Andrew Johnson. 'Hon. Edwin M. Stanton, Washington, D. C.'

"And to whom was also referred by the House of Representatives the following resolution, namely:

'Resolved, That Andrew Johnson, President of the United States, be impeached of high crimes and misdemeanors.'

"Have considered the several subjects referred to them, and submit the following report:

"That in addition to the papers referred to the committee, the committee find that the President, on the 21st day of February, 1868, signed and issued a commission or letter of authority to one Lorenzo Thomas, directing and authorizing said Thomas to act as Secretary of War ad interim, and to take possession of the books, records, and papers, and other public property in the war department, of which the following is a copy:

'Executive Mansion, } 'Washington, February 21, 1868.} 'Sir:--Hon. Edwin M. Stanton having been this day removed from office as secretary for the department of war, you are hereby authorized and empowered to act as Secretary of War ad interim, and will immediately enter upon the discharge of the duties pertaining to that office. Mr. Stanton has been instructed to transfer to you all the records, books, papers, and other public property now in his custody and charge.

'Respectfully yours, 'Andrew Johnson. 'To Brevet Major General Lorenzo Thomas, Adjutant General of the United States Army, Washington, District of Columbia.

'Official copy respectfully furnished to Hon. Edwin M. Stanton.

'L. Thomas 'Secretary of War ad interim.'

"Upon the evidence collected by the committee, which is herewith presented, and in virtue of the powers with which they have been invested by the House, they are of the opinion that Andrew Johnson, President of the United States, be impeached of high crimes and misdemeanors. They therefore recommend to the House the adoption of the accompanying resolution:

"Thaddeus Stevens, "George S. Boutwell, "John A. Bingham, "C. T. Hulburd, "John F. Farnsworth, "F. C. Beaman, "H. E. Paine.

"Resolution providing for the impeachment of Andrew Johnson, President of the United States:

'Resolved, That Andrew Johnson, President of the United States, be impeached of high crimes and misdemeanors in office.'"

On the 24th of February the resolution providing for impeachment was adopted by a vote of 126 yeas and 47 nays.

On the same day Mr. Stevens introduced the following resolution, which was agreed to:

"Resolved, That a committee of two be appointed to go to the Senate and, at the bar thereof, in the name of the House of Representatives and of all the people of the United States, to impeach Andrew Johnson, President of the United States, of high crimes and misdemeanors in office, and acquaint the Senate that the House of Representatives will, in due time, exhibit particular articles of impeachment against him and make good the same; and that the committee do demand that the Senate take order for the appearance of said Andrew Johnson to answer to said impeachment.

"2. Resolved, That a committee of seven be appointed to prepare and report articles of impeachment against Andrew Johnson, President of the United States, with power to send for persons, papers, and records, and to take testimony under oath."

The speaker then announced the following committees under these resolutions:

"Committee to communicate to the Senate the action of the House ordering an impeachment of the President of the United States:-- Thaddeus Stevens, of Pennsylvania, and John A. Bingham, of Ohio.

"Committee to declare articles of impeachment against the President of the United States:--George S. Boutwell, of Massachusetts; Thaddeus Stevens, of Pennsylvania; John A. Bingham, of Ohio; James F. Wilson, of Iowa; John A. Logan, of Illinois; George W. Julian, of Indiana; and Hamilton Ward, of New York."

The trial of this impeachment by the Senate was an imposing spectacle, which excited profound interest during its continuance. It was soon developed that the gravamen of the charges was not the removal of Stanton, but was the attempt of the President to force General Lorenzo Thomas into a high office without the advice and consent of the Senate.

In the trial of this impeachment I wished to be, and I think I was, absolutely impartial. I liked the President personally and harbored against him none of the prejudice and animosity of some others. I knew he was bold and rash, better fitted for the storms of political life than the grave responsibilities of the chief magistrate of a great country. His education, such as it was, was acquired late in life, when his character was formed and his habits fixed. Still, his mind was vigorous and his body strong, and when thoroughly aroused he was an able speaker; his language was forcible and apt and his influence over a popular audience was effective. I disliked above all things to be a judge in his case. I knew some of my associates were already against the President, and others were decided in his favor. I resolutely made up my mind, so far as human nature would admit, to fairly hear and impartially consider all the evidence produced and all the arguments made.

The counsel for the President were Henry Stanbery, B. R. Curtis, Jeremiah S. Black, William M. Evarts, William S. Groesbeck, and Thomas A. R. Nelson. The managers on the part of the House of Representatives were John A. Bingham, George S. Boutwell, James F. Wilson, John A. Logan, Thomas Williams, Benjamin F. Butler and Thaddeus Stevens. The trial lasted nearly two months, was ably conducted on both sides, and ended by the acquittal of the President, on the eleventh article of impeachment, by a vote of 35 guilty and 19 not guilty. Two-thirds of those voting not having pronounced "guilty," as required by the constitution, the President was acquitted upon this article. Two other articles were voted on with the same result. Thereupon, on the 26th day of May, 1868, the Senate sitting as a court of impeachment adjourned without day. Mr. Stanton resigned and General Schofield became Secretary of War.

I voted for conviction for the reasons stated in the opinion given by me. I have carefully reviewed this opinion and am entirely content with it. I stated in the beginning my desire to consider the case without bias or feeling. I quote in full the opening paragraphs:

"This cause must be decided upon the reasons and presumptions which by law apply to all other criminal accusations. Justice is blind to the official station of the respondent, and to the attitude of the accusers speaking in the name of all the people of the United States. It only demands of the Senate the application to this cause of the principles and safeguards provided for every human being accused of crime. For the proper application of these principles we ourselves are on trial before the bar of public opinion. The novelty of this proceeding, the historical character of the trial, and the grave interests involved, only deepen the obligation of the special oath we have taken to do impartial justice according to the constitution and laws.

"And this case must be tried upon the charges now made by the House of Representatives. We cannot consider other offenses. An appeal is made to the conscience of each Senator of guilty or not guilty by the President of eleven specific offenses. In answering this appeal a Senator cannot justify himself by public opinion, or by political, personal, or partisan demands, or even grave considerations of public policy. His conscientious conviction of the truth of these charges is the only test that will justify a verdict of guilty. God forbid that any other shall prevail here. In forming this conviction we are not limited merely to the rules of evidence, which, by the experience of ages, have been found best adapted to the trial of offenses in the double tribunal of court and jury, but we may seek light from history, from personal knowledge, and from all sources that will tend to form a conscientious conviction of the truth. And we are not bound to technical definitions of crimes and misdemeanors.

"A willful violation of the law, a gross and palpable breach of moral obligations tending to unfit an officer for the proper discharge of his office, or to bring the office into public contempt and derision, is, when charged and proven, an impeachable offense. And the nature and criminality of the offense may depend on the official character of the accused. A judge would be held to higher official purity, and an executive officer to a stricter observance of the letter of the law. The President, bound as a citizen to obey the law, and specially sworn to execute the law, may properly, in his high office as chief magistrate, be held to a stricter responsibility than if his example was less dangerous to the public safety. Still, to justify the conviction of the President there must be specific allegations of some crime or misdemeanor involving moral turpitude, gross misconduct, or a willful violation of law, and the proof must be such as to satisfy the conscience of the truth of the charge.

"The principal charges against the President are that he willfully and purposely violated the constitution and the laws, in the order for the removal of Mr. Stanton, and in the order for the appointment of General Thomas as Secretary of War ad interim. These two orders were contemporaneous--part of the same transaction--but are distinct acts, and are made the basis of separate articles of impeachment."

I stated the grounds of my conviction that the action of the President, in placing Lorenzo Thomas in charge of the office of Secretary of War, without the advice and consent of the Senate, was a clearly illegal act, committed for the purpose of obtaining control of that office. I held that the President had the power to remove Secretary Stanton, but that he had not the power to put anyone in his place unless the person appointed was confirmed by the Senate.

Did the act of March 2, 1867, commonly known as the "tenure of office act," confer this authority? On the contrary, it plainly prohibits all temporary appointments except as specially provided for. The third section repeats the constitutional authority of the President to fill all vacancies happening during the recess of the Senate by death or resignation, and provides that if no appointment is made during the following session to fill such vacancy, the office shall remain in abeyance until an appointment is duly made and confirmed, and provision is made for the discharge of the duties of the office in the meantime. The second session provides for the suspension of an officer during the recess, and for a temporary appointment during the recess. This power was exercised and fully exhausted by the suspension of Mr. Stanton until restored by the Senate, in compliance with the law. No authority whatever is conferred by this act for any temporary appointment during the session of the Senate, but, on the contrary, such an appointment is plainly inconsistent with the act, and could not be inferred or implied for it. The sixth section further provides:

"That every removal, appointment, or employment, made, had, or exercised, contrary to the provisions of this act, and the making, signing, sending, countersigning, or issuing of any commission or letter of authority for, or in respect to, any such appointment or employment, shall be deemed, and are hereby declared to be, high misdemeanors, and, upon trial and conviction thereof, every person guilty thereof shall be punished by a fine not exceeding $10,000, or by imprisonment not exceeding five years, or both said punishments, in the discretion of the court."

This language is plain, explicit, and was inserted not only to prohibit all temporary appointments except during the recess, and in the mode provided for in the second section, but the unusual course was taken of affixing a penalty to a law defining the official duty of the President. The original bill did not contain penal clauses; but it was objected in the Senate that the President had already disregarded mandatory provisions of law, and would this; and therefore, after debate, these penal sections were added to secure obedience to the law, and to give to it the highest sanction.

I quote my view of the action of the President:

"Was not this act willfully violated by the President during the session of the Senate?

"It appears, from the letter of the President to General Grant, from his conversation with General Sherman, and from his answer, that he had formed a fixed resolve to get rid of Mr. Stanton, and fill the vacancy without the advice of the Senate. He might have secured a new Secretary of War by sending a proper nomination to the Senate. This he neglected and refused to do. He cannot allege that the Senate refused to relieve him from an obnoxious minister. He could not say that the Senate refused to confirm a proper appointee, for he would make no appointment to them. The Senate had declared that the reasons assigned for suspending Mr. Stanton did not make the case required by the tenure of office act, but I affirm as my conviction that the Senate would have confirmed any one of a great number of patriotic citizens if nominated to the Senate. I cannot resist the conclusion, from the evidence before us, that he was resolved to obtain a vacancy in the department of war in such a way that he might fill the vacancy by an appointment without the consent of the Senate, and in violation of the constitution and the law. This was the purpose of the offer to General Sherman. This was the purpose of the appointment of General Thomas. If he had succeeded as he hoped, he could have changed his temporary appointment at pleasure, and thus have defied the authority of the Senate and the mandatory provisions of the constitution and the law. I cannot in any other way account for his refusal to send a nomination to the Senate until after the appointment of General Thomas. The removal of Mr. Stanton by a new appointment, confirmed by the Senate, would have complied with the constitution. The absolute removal of Mr. Stanton would have created a temporary vacancy, but the Senate was in session to share in the appointment of another. An ad interim appointment, without authority of law, during the session of the Senate, would place the department of war at his control in defiance fo the Senate and the law, and would have set an evil example, dangerous to the public safety--one which, if allowed to pass unchallenged, would place the President above and beyond the law.

"The claim now made, that it was the sole desire of the President to test the constitutionality of the tenure of office act, is not supported by reason or by proof. He might, in August last, or at any time since, without an ad interim appointment, have tested this law by a writ of quo warranto. He might have done so by an order of removal, and a refusal of Mr. Stanton's requisitions. He might have done so by assigning a head of department to the place made vacant by the order of removal. Such was not his purpose or expectation. He expected by the appointment of General Sherman at once to get possession of the war department, so when General Thomas was appointed there was no suggestion of a suit at law, until the unexpected resistance of Mr. Stanton, supported by the action of the Senate, indicated that as the only way left."

It is difficult to convey, by extracts, a correct idea of a carefully prepared opinion, but this statement shows my view of the case, and, entertaining it, I felt bound, with much regret, to vote "guilty" in response to my name, but I was entirely satisfied with the result of the vote, brought about by the action of several Republican Senators. There was some disposition to arraign these Senators and to attribute their action to corrupt motives, but there was not the slightest ground for the imputations. Johnson was allowed to serve out his term, but there was a sense of relief when General Grant was sworn into office as President of the United States.

CHAPTER XX. THE FORTIETH CONGRESS. Legislation During the Two Years--Further Reduction of the Currency by the Secretary Prohibited--Report of the Committee of Conference --Bill for Refunding the National Debt--Amounted to $2,639,382,572.68 on December 1, 1867--Resumption of Specie Payments Recommended-- Refunding Bill in the Senate--Change in My Views--Debate Participated in by Nearly Every Senator--Why the Bill Failed to Become a Law-- Breach Between Congress and the President Paralyzes Legislation-- Nomination and Election of Grant for President--His Correspondence with General Sherman.

During the 40th Congress, extending from the 4th of March, 1867, to the 4th of March, 1869, the chief subjects of debate were the contraction of the currency, the refunding of the public debt, the payment of United States notes in coin, and a revision of the laws imposing internal taxation and duties on imported goods.

Early in the first session of this Congress, the opposition of the people to the policy of contraction, constantly pressed by Secretary McCulloch, became so imperative that both Houses determined to take from him all power to diminish the volume of currency then in circulation. On the 5th of December, 1867, Robert C. Schenck, chairman of the committee of ways and means, reported a bill in the following words:

"Be it enacted, etc., That so much of an act entitled 'An act to amend an act to provide ways and means to support the government,' approved April 12, 1866, as authorizes the Secretary of the Treasury to retire United States notes to an amount not exceeding $4,000,000 in any one month, is hereby repealed.

"Sec. 2. And be it further enacted, That from and after the passage of this act the further reduction of the currency by retiring or canceling United States notes shall be, and hereby is, prohibited."

This bill was taken up for consideration on the 7th of December, and, after a brief debate, with little opposition, passed the House by the vote of 127 yeas and 32 nays. It was sent to the Senate, referred to the committee on finance, and was carefully considered. That committee, with but two dissenting voices, directed me to report the bill to the Senate with a single amendment. On the 9th of January, 1868, I called up the bill for consideration, and made a brief explanation, in which I said the committee, after full reflection, had thought proper to recommend the passage of the bill of the House of Representatives, in substance as it was sent to us, only changing the phraseology. I said that the bill contemplated further legislation during that session. It was understood by all that some more comprehensive measures must be adopted during that session, but until further legislation there should be no more contraction of the currency. I thus stated the reasons which, in my opinion, justified the passage of the bill:

"First. It will satisfy the public mind that no further contraction will be made when industry is in a measure paralyzed. We hear the complaint from all parts of the country, from all branches of industry, from every state in the Union, that industry for some reason is paralyzed, and that trade and enterprise are not so well rewarded as they were. Many, perhaps erroneous, attribute all this to the contraction of the currency--a contraction that I believe is unexampled in the history of any nation. $140,000,000 has been withdrawn out of $737,000,000 in less than two years. There is no example, that I know of, of such rapid contraction. It may be wise, it may be beneficial, but still it has been so rapid as to excite a stringency that is causing complaint, and I think the people have a right to be relieved from that.

"Second. This bill will restore to the legislature their power over the currency, a power too important to be delegated to any single officer of the government. I do not wish to renew the discussion that occurred here two years ago on the passage of the law of April 12, 1866; but it is still my opinion, as it has been always, that the question of the amount of currency ought to be fixed by Congress. We have the power to coin money, and to regulate the value thereof. We have coined money in the form of paper money, and certainly the power of Congress in this respect ought not to be delegated to any single officer. If contraction ought to be established as a policy it should be by Congress, not by the Secretary of the Treasury, and it is not wise to confer upon any officer of the government a power of this kind, which can be and may be properly controlled and limited by Congress.

"Third. This will strongly impress upon Congress the imperative duty of acting wisely upon financial measures, for the responsibility will then rest entirely upon Congress, and will not be shared with them by the Secretary of the Treasury.

"Fourth. It will encourage business men to continue old, and embark in new, enterprises, when they are assured that no change will be made in the measure of value without the open and deliberate consent of their representatives.

"These considerations are amply sufficient to justify this measure, but it is only preliminary to others of far greater importance that must command our attention. These involve--

"1. The existence of the banking system of the United States.

"2. The time and manner of resuming specie payments.

"3. The mode of redeeming the debt of the United States and the kind of money in which it may be redeemed; and, in this connection, the taxes, if any, that may be levied upon the public creditors.

"4. Such a reduction of our expenditures and taxes as will relieve our constituents, as far as practicable, from the burdens resulting from the recent war."

This led to a long debate, which continued until the 15th of January, when the bill, as amended, passed by a vote of 33 years and 4 nays.

These decisive votes against contraction definitely settled the policy of the government to retain in circulation the then existing volume of United States notes. The disagreement between the two Houses was referred to a committee of conference, and the conferees reported the bill in the following form:

"Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

"That, from and after the passage of this act, the authority of the Secretary of the Treasury to make any reduction of the currency, by retiring or canceling United States notes, shall be, and is hereby, suspended; but nothing herein contained shall prevent the cancellation and destruction of mutilated United States notes, and the replacing of the same with notes of the same character and amount."

This bill was sent to the President, and, not having been returned by him within ten days, it became a law without his approval, under the constitution of the United States.

On the 17th of December, 1867, I reported from the committee on finance a bill for refunding the national debt and for a conversion of the notes of the United States. This bill was accompanied by an elaborate report. This report was carefully prepared by me, and met, I believe, the general approval of the committee on finance. In that Congress there were but five Democratic Senators, and it so happened that all the members of the committee on finance were Republicans, but these represented widely different opinions on financial subjects. I undertook, in this report, to deal in a general way with these topics. Upon a careful reading of it now I find but little that I do not approve. The general policy set out in this report was subsequently embodied into laws, but the measures relating to refunding the debt and the resumption of specie payments were not adopted until several years after the date of the report.

The ascertained debt on the first day of December, 1867, as stated by the Secretary of the Treasury, was $2,639,382,572.68, divided as follows:

Debt bearing coin interest. 5 per cent. bonds, 10-40's, and old fives $205,532,580.00 6 per cent. bonds of 1867 and 1868 . . . . 14,690,941.80 6 per cent. bonds, 1881 . . . . . . . . . 282,731,550.00 6 per cent. 5-20 bonds . . . . . . . . . . 1,324,412,550.00 Navy pension fund . . . . . . . . . . . . 13,000,000.00 ---------------- $1,840,367,891.80 Debt bearing currency interest. 6 per cent. bonds . . . . . . . . . . . . $18,601,000.00 3-year compound interest notes . . . . . . 62,249,360.00 3-year 7-30 notes . . . . . . . . . . . . 285,587,100.00 3 per cent. certificates . . . . . . . . . 12,855,000.00 ---------------- $379,292,460.00 Matured debt not presented for payment. 3 year 7-30 notes, due August 15, 1867 . . $2,855,400.00 Compound interest notes, matured June 10, July 15, August 15, and October 15, 1867 7,065,750.00 Bonds, Texas indemnity . . . . . . . . . . 260,000.00 Treasury notes, acts July 17, 1861 and prior thereto . . . . . . . . . . . . . 163,011.64 Bonds, April 15, 1842 . . . . . . . . . . 54,061.64 Treasury notes, March 3, 1863 . . . . . . 868,240.00 Temporary loan . . . . . . . . . . . . . . 2,880,900.55 Certificates of indebtedness . . . . . . . 31,000.00 ---------------- $14,178,363.83 Debt bearing no interest. United States notes . . . . . . . . . . . $356,212,473.00 Fractional currency . . . . . . . . . . . 30,929,984.05 Gold certificates of deposit . . . . . . . 18,401,400.00 ---------------- $405,543,857.05 Total debt . . . . . . . . . . . . . . . . . . . . . . . $2,639,382,572.68 Amount in treasury, coin . . . . . . . . . $100,690,645.69 Amount in treasury, currency . . . . . . . 37,486,175.24 Amount of debt less cash in treasury . . . . . . . . . . . $2,501,205,751.75

Besides the amounts thus stated there were large balances due to loyal states, upon accounts not then rendered or ascertained, and to individuals for losses sustained during the war.

The ascertained debt consisted of twenty different forms of liability, some payable in coin and some in lawful money. Much of this debt was due on demand, but the great body of it was payable in from one to twenty years, while the unascertained debt was being stated from time to time and had to be met from accruing revenues. Nearly $300,000,000 of debt had been paid out of current revenue since the close of the war. The first recommendation of the committee was that the debt should be refunded as rapidly as practicable into bonds bearing as low a rate of interest as possible, payable in twenty or thirty years, but redeemable at the pleasure of the United States in five or ten years. This recommendation was based on the fixed policy of the government to limit the duration of a bond within its lifetime, and thus leave it to the option of the government to pay its indebtedness and to reduce the rate of interest after a brief period, if the condition of the public revenues and of the money market should enable it to do so.

Here the question arose whether the bonds known as the 5-20 bonds could be paid in lawful money after the period of five years, when, by their terms, they were redeemable. These bonds promised to pay so many dollars. Other bonds were specifically payable in coin, and still other bonds were payable in lawful money; that is, in United States notes. These notes were then at a discount, being worth in the market about 88 cents in coin. But the notes were obligations of the United States, and it was the duty, and then within the power of the United States, to advance these notes to par in coin.

The majority of the committee, I among them, believed that the United States should not take advantage of its own wrong, in not redeeming its notes in coin, but should either advance these notes to par in coin, or pay its bonds in coin. The committee, therefore, recommended that both the notes and bonds should be received in exchange for the funding bonds, and that the notes should be reissued and maintained at par with coin, and be supported by a reserve of coin ample to maintain the notes at par with coin. In other words, the United States would resume specie payments. The committee expressed the opinion that, with the system of taxation then in existence, this policy of refunding and resumption could be maintained, and that the rate of interest then paid could be reduced to four or five per cent., and the money then in circulation would be kept at par with coin at the cost only of the interest on the bullion and coin held to meet any notes presented for redemption. The committee also recommended that the internal and tariff taxes be revised to correct irregularities or defects, and to repeal such as were oppressive.

While the committee opposed any contraction of the currency it also opposed any increase of it. The general theory of the report was to advance both bonds and notes to par in coin, and to issue bonds in such form and terms that the government could redeem them, or renew them at lower rates of interest.

The report states:

"Your committee are therefore of opinion that no legal tender notes, beyond the amount now limited by law, should be issued under any pressure of financial or political necessity until they are convertible into gold and silver. Our duty is to elevate the 'greenback,' the standard of national credit, to the standard of gold, the money of the world. Until then we are not on a substantial foundation. Let us make the dollar of our promise in the pocket of a laboring man equal to the dollar of our mint. The rapidity of the process is a question of public policy. It may be by gradually diminishing the volume of currency, or be left at its present amount until increased business or improved credit bring it up to the specie standard."

The refunding bill was taken up by the Senate on the 27th of February, 1868, and was fully discussed by me. After stating its general objects I said:

"It is with this view, and actuated by this principle, that the committee on finance have endeavored to make this a bill of relief, reducing, if possible, consistent with the public faith, the interest of the public debt, and giving increased value to United States notes. We have endeavored in this bill to accomplish three results: First, to reduce the rate of interest with the voluntary consent of the holders of our securities; second, to make a distinct provision for the payment of the public debt; and third, to give increased value to United States notes, and to provide for a gradual resumption of specie payments. All these are objects admitted to be of the highest importance. The only question is, whether the measure proposed tends to accomplish them."

I then quoted the example of the United States and Great Britain in reducing the rate of interest on public securities. I do not approve all I said in that speech. It has been frequently quoted as being inconsistent with my opinions and action at a later period. It is more important to be right than to be consistent. I then proposed to use the doubt expressed by many people as to the right of the government to redeem the 5-20 bonds in the legal tender money in circulation when the bonds were sold, as an inducement to the holders of bonds to convert them into securities bearing a less rate of interest but specifically payable in coin. Upon this policy I changed my opinion. I became convinced that it was neither right nor expedient to pay these bonds in money less valuable than coin, that the government ought not to take advantage of its neglect to resume specie payments after the war was over, by refusing the payment of the bonds with coin. I acted on this conviction when years afterwards the resumption act was adopted, and the beneficial results from this action fully justified my change of opinion.

The debate on this bill was participated in by nearly every Senator, and was conceded to be the most comprehensive and instructive debate on financial questions for many years.

The bill, as it then stood, authorized the Secretary of the Treasury to issue registered or coupon bonds of the United States, in such form and of such denominations as he might prescribe, payable, principal and interest, in coin, and bearing interest at the rate of five per cent. per annum, payable semi-annually, such bonds to be payable forty years from date and to be redeemable in coin after ten years.

It authorized the exchange of the bonds commonly known as the 5-20 bonds for the bonds authorized by that bill. It also authorized the holders of United States notes to the amount of $1,000, or any multiple of that sum, to convert them into the five per cent. bonds provided for by the bill. This bill passed the Senate on the 14th of July, 1868. It passed the House of Representatives soon after, with amendments that were disagreed to by the Senate. The bill and amendments were referred to a conference committee which reported a modified bill which passed both Houses and was sent to President Johnson, but at so late a period of the session that it was not approved by him and thus failed to become a law.

The committee on finance at the next and closing session of that Congress deemed it useless to report another funding bill, and on the 16th of December, 1868, I reported, by direction of that committee, the following resolution:

"Resolved by the Senate, That neither public policy nor the good faith of the nation will allow the redemption of the 5-20 bonds until the United States shall perform its primary duty of paying its notes in coin or making them equivalent thereto; and measures shall be adopted by Congress to secure the resumption of specie payments at as early a period as practicable."

This resolution was the foundation of the act "to strengthen the public credit," the first act subsequently adopted in General Grant's administration. Neither this nor any other financial measure was pressed to a conclusion, as we knew that any measure that would be sanctioned by Congress would probably be vetoed by the President. This, however, did not stop the almost continuous financial debate which extended to the currency, banking, funding and taxation. The drift of opinion was in favor of resumption without contraction, and funding at low rates of interest on a coin basis. The wide breach between Congress and the President paralyzed legislation. But one vital question had been settled, that no further contraction of the currency should occur; and it was well settled, though not embodied in law, that no question would be made as to the payment of bonds in coin.

While Congress was drifting to a sound financial policy, the President and his Secretary of the Treasury were widely divergent, the former in favor of repudiation, and the latter in favor of paying and canceling all United States notes.

President Johnson, in his last annual message to Congress, on the 9th of December, 1868, substantially recommended a repudiation of the bonds of the United States, as follows:

"Upon this statement of facts it would seem but just and equitable that the six per cent. interest now paid by the government should be applied to the reduction of the principal in semi-annual installments, which in sixteen years and eight months would liquidate the entire national debt. Six per cent. in gold would, at present rates, be equal to nine per cent. in currency, and equivalent to the payment of the debt one and half times in a fraction less than seventeen years. This, in connection with the other advantages derived from their investment, would afford to the public creditors a fair and liberal compensation for the use of their capital, and with this they should be satisfied. The lessons of the past admonish the lender that it is not well to be over anxious in exacting from the borrower rigid compliance with the letter of the bond."

While the President wished to apply the interest on the United States bonds to the redemption of the principal, the Secretary of the Treasury was pressing for the restoration of the specie standard. I quote from his report to Congress, made on the same day the message of the President was sent us:

"The first and most important of these measures are those which shall bring about, without unnecessary delay, the restoration of the specie standard. The financial difficulties under which the country is laboring may be traced directly to the issue, and continuance in circulation, of irredeemable promises as lawful money. The country will not be really and reliably prosperous until there is a return to specie payments. The question of a solvent, convertible currency, underlies all the other financial and economical questions. It is, in fact, a fundamental question; and until it is settled, and settled in accordance with the teachings of experience, all attempts in other financial and economical reforms will either fail absolutely, or be but partially successful. A sound economy is the lifeblood of a commercial nation. If this is debased the whole current of its commercial life must be disordered and irregular. The starting point in reformatory legislation must be here. Our debased currency must be retired or raised to the par of specie, or cease to be lawful money, before substantial progress can be made with other reforms."

Under these circumstances, it was manifest that no wise financial legislation could be secured until General Grant should become President of the United States.

The Republican national convention met at the city of Chicago, on the 20th of May, 1868. It declared its approval of the reconstruction policy of Congress, denounced all forms of repudiation as a national crime, and pledged the national good faith to all creditors at home and abroad, to pay all public indebtedness, not only according to the letter, but the spirit, of the law. It favored the extension of the national debt over a fair period for redemption, and the reduction of the rate of interest whenever it could be honestly made. It arraigned, with severity, the treachery of Andrew Johnson, and deplored the tragic death of Abraham Lincoln. The entire resolutions were temperate in tone; they embodied the recognized policy of the Republican party, and made no issue on which Republicans were divided.

The real issue was not one of measures, but of men. The nomination of General Grant for President, and Schuyler Colfax for Vice President, upon the basis of reconstruction by loyal men, was antagonized by the nomination, by the Democratic convention, of Horatio Seymour for President, and Francis P. Blair for Vice President, upon the basis of universal amnesty, and immediate restoration to power, in the states lately in rebellion, of the men who had waged war against the government.

In this contest, Grant was the representative Union soldier of the war, and Seymour was the special representative of the opponents in the north to the war. Grant received 197 electoral votes, and Seymour 72.

A few hours in advance of the meeting of the national convention, there was a great mass meeting of soldiers and sailors of the war, a delegation from whom, headed by General Lucius Fairchild, of Wisconsin, entered the convention after its organization and presented this resolution:

"Resolved, That as the soldiers and sailors, steadfast now as ever to the Union and the flag, fully recognize the claims of Gen. Ulysses S. Grant to the confidence of the American people, and believing that the victories won under his guidance in war will be illustrated by him in peace by such measures as will secure the fruits of our exertions and restore the Union upon a loyal basis, we declare our deliberate conviction that he is the choice of the soldiers and sailors of the Union for the office of President of the United States."

This resolution was received with great applause. Henry S. Lane, of Indiana, leaped upon a chair, and moved to nominate Grant by acclamation. This was done without rules and amid great excitement.

I need not say that I gave to General Grant my cordial and active support. From the beginning of the canvass to the end, there was no doubt about the result. I spoke on his behalf in several states and had frequent letters from him. Assuming that his election was already foreordained, I invited him to stop with me in Mansfield, on his way to Washington, and received from him the following autograph letter, which, though dated at Headquarters Army of the United States, was written at Galena, Illinois:

"Headquarters Army of the United States,} "Washington, D. C., October 26, 1868. } "Dear Senator:--Your invitation to Mrs. Grant and myself to break our journey east and spend a day or two with you was duly received, and should have been sooner acknowledged. I thank you for the invitation and would gladly accept it, but my party will be large and having a special car it will inconvenience so many people to stop over. Mrs. Grant too and her father are anxious, when they start, to get through to Washington before they unpack.

"Yours truly, "U. S. Grant. "Hon. J. Sherman, U. S. S."

On the same day he wrote a letter to General Sherman, which was referred to me by the latter. I regard this letter, which exhibits closely the cordial relations existing, at the time, between the two men, as of sufficient interest to justify its publication:

"Headquarters Army of the United States,} "Washington, D. C., October 26, 1868. } "Dear General:--Your letter inclosing one from your brother was duly received. As I did not want to change your determination in regard to the publication of the correspondence between us, and am getting to be a little lazy, I have been slow in answering. I had forgotten what my letter to you said but did remember that you spoke of the probable course the Ewings would take, or something about them which you would not probably want published with the letters. The fact is, general, I never wanted the letters published half so much on my own account as yours. There are a great many people who do not understand as I do your friendship for me. I do not believe it will make any difference to you in the end, but I do fear that, in case I am elected, there will be men to advocate the 'abolition of the general' bill who will charge, in support of their motion, lack of evidence that you supported the Union cause in the canvass. I would do all I could to prevent any such legislation, and believe that without my doing anything the confidence in you is too genuine with the great majority of Congress for any such legislation to succeed. If anything more should be necessary to prove the falsity of such an assumption the correspondence between us heretofore could then be produced.

"I agree with you that Sheridan should be left alone to prosecute the Indian War to its end. If no treaty is made with the Indians until they can hold out no longer we can dictate terms, and they will then keep them. This is the course that was pursued in the northwest, where Crook has prosecuted war in his own way, and now a white man can travel through all that country with as much security as if there was not an Indian in it.

"I have concluded not to return to Washington until after the election. I shall go very soon after that event, however. My family are all well and join me in respects to Mrs. Sherman and the children.

"Yours truly, "U. S. Grant. "Lt. Gen. W. T. Sherman, U. S. Army."

In the spring of 1871 there was a good deal of feeling against Grant, and some opposition indicated to his renomination for the presidency. Several influential papers had recommended the nomination of General Sherman, who then, as always afterwards, had resolutely announced his purpose not to allow his name to be used in connection with the office of President. This suggestion arose out of the feeling that injustice had been done to General Sherman by the Secretary of War, Mr. Belknap, who practically ignored him, and issued orders in the name of the President, greatly interfering with the personnel of the army. This led to the transfer of General Sherman from Washington to St. Louis. General Sherman made no complaint of Grant, who had the power to control the action of the Secretary of War, but the general impression prevailed that the friendly relations that had always subsisted between the President and General Sherman had been disturbed, but this was not true. I have no doubt that Grant, in the following letter, stated truthfully his perfect willingness that General Sherman should, if he wished, be made his successor as President:

"Long Branch, N. J., June 14, 1871. "Dear Senator:--Being absent at West Point until last evening, for the last week, your letter of the 5th inst., inclosing one to you from General Sherman, is only just received. Under no circumstances would I publish it; and now that the 'New York Herald' has published like statements from him it is particularly unnecessary. I think his determination never to give up his present position a wise one, for his own comfort, and the public, knowing it, will relieve him from the suspicion of acting and speaking with reference to the effect his acts and sayings may have had upon his claims for political preferment. If he should ever change his mind, however, no one has a better right than he has to aspire to anything within the gift of the American people.

"Very truly yours, "U. S. Grant. "Hon. J. Sherman, U. S. S."

CHAPTER XXI. BEGINNING OF GRANT'S ADMINISTRATION. His Arrival at Washington in 1864 to Take Command of the Armies of the United States--Inaugural Address as President--"An Act to Strengthen the Public Credit"--Becomes a Law on March 19, 1869-- Formation of the President's Cabinet--Fifteenth Amendment to the Constitution--Bill to Fund the Public Debt and Aid in the Resumption of Specie Payments--Bill Finally Agreed to by the House and Senate --A Redemption Stipulation Omitted--Reduction of the Public Debt-- Problem of Advancing United States Notes to Par with Coin.

President Grant entered into his high office without any experience in civil life. In his training he was a soldier. His education at West Point, his services as a subordinate officer in the Mexican War, and as the principal officer in the Civil War of the Rebellion, had demonstrated his capacity as a soldier, but he was yet to be tested in civil life, where his duties required him to deal with problems widely differing from those he had successfully performed in military life. I do not recall when I first met him, but was confident it was before his coming to Washington, in March, 1864, to take command of the armies of the United States. His arrival in Washington then was not generally known until he entered the dining hall at Willard's hotel. He came in alone, and was modestly looking for a vacant seat when I recognized him and went to him and invited him to a seat at my table. He quietly accepted, and then the word soon passed among the many guests to the tables, that General Grant was there, and something like an ovation was given him. His face was unknown, but his name and praise had been sounded for two years throughout the civilized world. His coming to take full command of the Union forces was an augury of success to every loyal citizen of the United States. His personal memoirs, written in the face of death, tell the story of his life in a modest way, without pretension or guile. I am not sure that he added to his fame by his eight years of service as President of the United States, but what he did in subduing the Rebellion will always keep his name among those of the greatest benefactors of his country. He was elected because of his military services, and would have been elected in 1868 by any party that put him in nomination, without respect to platform or creed.

He opened his inaugural address with these words:

"Your suffrages, having elected me to the office of President of the United States, I have, in conformity with the constitution of our country, taken the oath of office prescribed therein. I have taken this oath without mental reservation and with the determination to do to the best of my ability all that it requires of me. The responsibilities of the position I feel but accept them without fear. The office has come to me unsought. I commence its duties untrammeled. I bring to it a conscientious desire and determination to fill it to the best of my ability to the satisfaction of the people.

"On all leading questions agitating the public mind I will always express my views to Congress, and urge them according to my judgment; and when I think it advisable will exercise the constitutional privilege of interposing a veto to defeat measures which I oppose. But all laws will be faithfully executed whether they meet my approval or not.

"I shall on all subjects have a policy to recommend, but none to enforce against the will of the people. Laws are to govern all alike, those opposed as well as those who favor them. I know no method to secure the repeal of bad or obnoxious laws so effective as their stringent execution."

And closed with these words:

"In conclusion I ask patient forbearance one toward another throughout the land, and a determined effort on the part of every citizen to do his share toward cementing a happy Union; and I ask the prayers of the nation to Almighty God in behalf of this consummation."

I believe he strictly performed what he thought was his duty, and if he erred, it was from a want of experience in the complicated problems of our form of government. The executive department of a republic like ours should be subordinate to the legislative department. The President should obey and enforce the laws, leaving to the people the duty of correcting any errors committed by their representatives in Congress.

The first act of the 41st Congress, entitled "An act to strengthen the public credit," was introduced in the House of Representatives by General Schenck, on the 12th of March, 1869, and was passed the same day. It came to the Senate on the 15th of March, and, on my motion, was substituted for a similar bill, reported from the committee on finance, and, after a brief debate, was passed by the decisive vote of 42 yeas and 13 nays, as follows:

"That in order to remove any doubt as to the purpose of the government to discharge all just obligations to the public creditors, and to settle conflicting questions and interpretations of the law by virtue of which said obligations have been contracted, it is hereby provided and declared that the faith of the United States is solemnly pledged to the payment in coin, or its equivalent, of all obligations of the United States not bearing interest, known as United States notes, and of all interest-bearing obligations of the United States, except in cases where the law authorizing the issue of any such obligations has expressly provided that the same may be paid in lawful money or other currency than gold and silver. But none of said interest-bearing obligations not already due shall be redeemed or paid before maturity, unless at such time United States notes shall be convertible into coin at the option of the holder, or unless at such time bonds of the United States bearing a lower rate of interest than the bonds to be redeemed can be sold at par in coin. And the United States also solemnly pledges its faith to make provision, at the earliest practicable period, for the redemption of United States notes in coin."

It was approved by the President and became a law on the 19th of March. Thus the controversy as to the payment of bonds in coin was definitely decided.

But little else of importance was done by Congress during this session. The usual general appropriation bill for the Indian department having failed in the previous Congress, a bill for that purpose was introduced in the House of Representatives and became a law on the 10th of April. The bill to provide for deficiencies was passed on the same day. A change was made in the tax on distilled spirits and tobacco, and provision was made for submitting the constitutions of Virginia, Mississippi and Texas to a vote of the people. A number of measures of local importance were passed, and, on the 10th of April, the Congress adjourned without day.

The Senate convened in pursuance of a proclamation of the President immediately on the adjournment of Congress, and after a few days, confined mainly to executive business, adjourned.

The early movements of Grant as President were very discouraging. His attempt to form a cabinet without consultation with anyone, and with very little knowledge, except social intercourse with the persons appointed, created a doubt that he would not be as successful as a President as he had been as a general, a doubt that increased and became a conviction in the minds of many of his best friends. The appointments of Stewart and Borie were especially objectionable. George S. Boutwell was well fitted for the office of Secretary of the Treasury, to which he was appointed after Stewart was excluded by the law. Washburne was a man of ability and experience, but he was appointed Secretary of State only for a brief time, and was succeeded by Hamilton Fish. Mr. Fish was eminently qualified for the office, and during both of the terms of Grant discharged the duties of it with great ability and success. Jacob D. Cox, of Ohio, was an educated gentleman, a soldier of great merit, and an industrious and competent Secretary of the Interior.

The impression prevailed that the President regarded these heads of departments, invested by law with specific and independent duties, as mere subordinates, whose function he might assume. This is not the true theory of our government. The President is intrusted by the constitution and laws with important powers, and so by law are the heads of departments. The President has no more right to control or exercise the powers conferred by law upon them than they have to control him in the discharge of his duties. It is especially the custom of Congress to intrust to the Secretary of the Treasury specific powers over the currency, the public debt and the collection of the revenue. If he violates or neglects his duty he is subject to removal by the President, or impeachment by the House of Representatives, but the President cannot exercise or control the discretion reposed by law in the Secretary of the Treasury, or in any head or subordinate in any department of the government. This limitation of the power of the President, and the distribution of power among the departments, is an essential requisite of a republican government, and it is one that an army officer, accustomed to give or receive orders, finds it difficult to understand and to observe when elected President.

Congress convened on the 6th of December, 1869. The chief recommendations submitted to Congress by the President related to the gradual reconstruction of the states lately in rebellion, to the resumption of specie payments and the reduction of taxation. The relations of Great Britain and the United States growing out of the war were treated as a grave question, and a hope was expressed that both governments would give immediate attention to a solution of the just claims of the United States growing out of the Civil War. The message was brief, modest, conservative and clear. He closed by saying that on his part he promised a rigid adherence to the laws and their strict enforcement.

The most important measure consummated during this Congress was the adoption of the 15th amendment of the constitution of the United States, declared, in a proclamation of the Secretary of State, dated March 30, 1870, to have been ratified by the legislatures of twenty-nine of the thirty-seven states, as follows:

"The right of citizens of the United States to vote shall not be denied or abridged by the United States, or by any state, on account of race, color, or previous condition of servitude."

It is a question of grave doubt whether this amendment, though right in principle, was wise or expedient. The declared object was to secure impartial suffrage to the negro race. The practical result has been that the wise provisions of the 14th amendment have been modified by the 15th amendment. The latter amendment has been practically nullified by the action of most of the states where the great body of this race live and will probably always remain. This is done, not by an express denial to them of the right of suffrage, but by ingenious provisions, which exclude them on the alleged ground of ignorance, while permitting all of the white race, however ignorant, to vote at all elections. No way is pointed out by which Congress can enforce this amendment. If the principle of the 14th amendment had remained in full force, Congress could have reduced the representation of any state, in the proportion which the number of the male inhabitants of such state, denied the right of suffrage, might bear to the whole number of male citizens twenty-one years of age, in such state. This simple remedy, easily enforced by Congress, would have secured the right of all persons, without distinction of race or color, to vote at all elections. The reduction of representation would have deterred every state from excluding the vote of any portion of the male population above twenty-one years of age. As the result of the 15th amendment, the political power of the states lately in rebellion has been increased, while the population, conferring this increase, is practically denied all political power. I see no remedy for this wrong except the growing intelligence of the negro race, which, in time, I trust, will enable them to demand and to receive the right of suffrage.

The most important financial measure of that Congress was the act to refund the national debt. The bonds known as the 5-20's, bearing interest at six per cent., became redeemable, and the public credit had so advanced that a bond bearing a less rate of interest could be sold at par. The committee on finance of the Senate, on the 3rd day of February, 1870, after more care and deliberation, than, so far as I know, it has ever bestowed on any other bill, finally reported a bill to fund the public debt, to aid in the resumption of specie payments, and to advance the public credit.

The first section authorized the issue of $400,000,000 of bonds, redeemable in coin at the pleasure of the United States, at any time after ten years, bearing interest at five per cent.

The second section authorized the issue of bonds to the amount of $400,000,000, redeemable at the pleasure of the government, at any time after fifteen years, and bearing interest at four and a half per cent.

The third section authorized the issue of $400,000,000 of bonds, redeemable at any time after twenty years, and bearing interest at the rate of four per cent.

The proceeds of all these bonds were to be applied to the redemption of 5-20 and 10-40 bonds, and other obligations of the United States then outstanding.

It will be perceived that this bill provided for the issue of securities, all of which were redeemable within twenty years, and two-thirds of which were redeemable within fifteen years, so that if the bill, as reported by the committee on finance, had become the law, no such difficulty as we labored under eighteen years later, when we had a large surplus revenue, would have existed.

The bill passed the Senate, in substantially the form reported from the committee on finance, by the large vote of 33 to 10, and was, perhaps, the most carefully prepared of any of the financial measures of the government.

In opening the debate, I called the attention of the Senate to the great advantage the government had derived from making its bonds redeemable at brief periods, like the 5-20 bonds, the 10-40 bonds, and the treasury notes. I also called attention to the fact that the same principle of maintaining the right to redeem had been ingrafted in the bill then before the Senate, that the duration of the bonds was divided into three periods of ten, fifteen, and twenty years, during which time, by the gradual application of the surplus revenue, the whole debt might be paid. This was the bill sent by the Senate to the House of Representatives, and if it had been adopted by the House, there would have been no trouble about the application of the surplus revenue, but by common consent it would have been used in the speedy extinction of the public debt.

The bill was sent to the House of Representatives on the 11th of March, and there seems to have slept for nearly three months without any action on the part of the House.

On the 6th of June the committee on ways and means reported House bill 2167, covering the same subject-matters as were contained in the Senate bill. The consideration of this bill was commenced, by sections, on the 30th of June. The material part of the first section of this bill is as follows:

"That the Secretary of the Treasury is hereby authorized to issue, in a sum or sums not exceeding in the aggregate $1,000,000,000, coupon or registered bonds of the United States, in such form as he may prescribe, and of denomination of $50, or some multiple of that sum, redeemable in coin of the present standard value at the pleasure of the United States after thirty years from the date of their issue, and bearing interest payable semi-annually in such coin at the rate of four per cent. per annum."

Thus it will be perceived that instead of the three series of bonds provided by the Senate, the House proposed to authorize the issue of $1,000,000,000, redeemable in coin after thirty years from the date of their issue, with interest at four per cent. This difference in the description of the bonds was the chief difference between the propositions of the House and the Senate. To emphasize this difference I quote what was said by the chairman of the House committee, Mr. Schenck, in reporting the bill:

"It is a proposition to refund a portion of the public debt of the country at a very much lower rate of interest. It is a proposition that $1,000,000,000 of that debt shall take the form of bonds, upon which the United States will agree to pay only four per cent. per annum. But, in order to make those bonds acceptable to capitalists at home and abroad, further provision is made that the bonds themselves shall have a longer time to run, not merely for thirty years, but that they shall only be redeemable after thirty years; thus giving them, without the objections, the advantages which in a great degree attach to a perpetual loan."

This bill, with a very limited debate, passed the House on the 1st of July, and then immediately was offered as a substitute for the Senate bill, and was adopted.

Those two rival propositions, differing mainly upon the question of the character of the bonds to be issued, were sent to a committee of conference, composed on the part of the Senate of Messrs. Sherman, Sumner and Davis. The chief controversy in the conference was as to the description of funding bonds to be provided for. After many meetings it was finally agreed that the bonds authorized should be $200,000,000 five per cent. bonds, $300,000,000 four and a half per cent. bonds, of the character described in the Senate bill, and $1,000,000,000 of four per cent. bonds, as described in the House bill. In other words, it was a compromise which, like many other compromises, was in its results an injury of great magnitude, but it was an honest difference of opinion between the Senate and the House, in which, tested by the march of time, the Senate was right and the House was wrong. But it was perfectly manifest that without this concession by the Senate to the House, the bill could not have passed, and even with this concession, the first report of the committee of conference was disagreed to by the House, because of certain provisions requiring the national banks to substitute the new bonds as the basis of banking circulation.

This disagreement by the House compelled a second committee of conference, in which the contested banking section was stricken out, and the bill agreed to as it now stands on the statute books.

And thus thirty-year securities, subsequently at a premium of more than twenty-five per cent., were forced into the law by the determined action of the House.

This proved to be an error. No bonds should have been authorized that did not contain a stipulation that the government might pay them at pleasure, after a brief period and before they became due. This stipulation during the war was inserted in the 5-20 and the 10-40 bonds. Its wisdom and importance were demonstrated by the early substitution of bonds bearing a lower rate of interest for the 5-20 six per cent. bonds. When this precedent was cited, and its saving to the government shown, it was strongly urged by the House conferees that such a provision would prevent the sale of bonds, and that there was no probability that bonds bearing less than four per cent. could be sold at any time at par. This was proven to be an error within a short period, for securities of the United States bearing three per cent. interest have been sold at par.

Some years later, Senator Beck, of Kentucky, arraigned me for consenting to the issue of bonds running thirty years, but I was able to show by the public records that I resisted this long duration of the four per cent. bonds, that the House insisted upon it, and that Mr. Beck, then a Member of the House, voted for it. The same objection was made by the Senate conferees to the bonds bearing four and a half and five per cent., that no stipulation was made authorizing the government to anticipate the payment of these bonds. Under the Senate bill the bonds would have been redeemable in a brief period, and would, no doubt, have been redeemed by bonds bearing four, three and a half, or three per cent. interest.

The bill, as it passed, authorized the conversion of all forms of securities, then outstanding, into the bonds provided for by the refunding act at par one with the other. The Secretary of the Treasury could sell the bonds provided for by the refunding act at par, and with the proceeds pay off the then existing securities as they became redeemable. In the discussion of this bill in the Senate, on the 28th of February, 1870, I made a carefully prepared speech, giving a detailed history of the various securities outstanding, and expressed the confident opinion that the existing coin bonds bearing six per cent. interest, and other securities bearing interest in lawful money, could be refunded into bonds running for a short period, bearing a reduced rate of interest. I said:

"After a long and memorable debate of over two months in both Houses of Congress, the act of February 25, 1862, was adopted. That was a revolutionary act. It was a departure from every principle of the financial policy of this government from its foundation. It overthrew, not only the mode and manner of borrowing money, but the character of our public securities, and was the beginning of a new financial system, unlike anything that had been ventured upon by any people in the world before. This new policy was adopted under the pressure of the severest necessities, and only because of those necessities, and was intended to meet a state of affairs never foreseen by the framers of the constitution.

"Now, sir, it is important to understand the principles of this act; for this act was the foundation of all the financial measures during the war. It was upon the basis of this act, enlarged and modified from time to time, that we were enabled to borrow $3,000,000,000 in three years and to put down the most formidable rebellion in modern history. This act was based upon certain fundamental conditions.

"Extraordinary power was conferred upon the Secretary of the Treasury to borrow money in almost any form, at home or abroad, practically without limitation as to amount, or with limits repeatedly enlarged. Every form of security which the ingenuity of man could devise was provided for by this act or the acts amending it. Under these acts bonds were issued, payable in twenty years, treasury notes were issued, certificates of indebtedness, compound-interest notes, and other forms of indebtedness, with varying rates of interest. There were, however, distinct limitations upon the nature and character of these loans. It was stipulated first, that more than six per cent. interest in gold should not be paid on the bonds issued, nor more than seven and three-tenths interest in currency should be paid on the notes issued; and second, all the loans provided by this act were short loans, redeemable within a short period of time at the pleasure of the United States. Thus the gold bonds were redeemable after five years, the treasury notes were redeemable after three years, and all forms of security were within the power of the United States at the end of five years at furthest. And third, no securities were to be sold at less than par. Their unavoidable depreciation was measured, not by the rate of their discount, but by the depreciation of the currency. We held our bonds at par in paper money, though at times they were worth only forty per cent. of gold. . . .

"Now, Mr. president, it may be proper to state the reasons for this policy. Short loans were adopted that we might not bind the future to the payment of usurious rates of interest. We recognized the existence of a great pressing necessity that would tend to depreciate the public credit; and we took care, therefore, not to make these loans for a long period, so as to bind the future to the payment of the rates which we were then compelled to pay.

"We provided for gold interest and gold revenue, to avoid the extreme inflations of an irredeemable currency. We wished to rest our paper fabric on a coin basis, and to keep constantly in view ultimate specie payments. I believe but for that provision in the loan act of February 25, 1862, that in 1864 our financial system would have been utterly overthrown. There was nothing to anchor it to the earth except the collection of duties in coin and the payment of the interest on our bonds in coin.

"But, sir, the most important and the most revolutionary principle of the act of February 25, 1862, was the legal tender clause. This was a measure of imperious and pressing necessity. I can recall very well the debates in the Senate and in the House of Representatives upon the legal tender clause. We were then standing in the face of a deficit of some $70,000,000 of unpaid requisitions to our soldiers. Creditors in all parts of the country, among them the most powerful corporations of this country, had refused our demand notes, then very slightly depressed. We were under the necessity of raising two or three million dollars per day. We were then organizing armies unheard of before. We stood also in the presence of defeat, constant and imminent, which fell upon our armies in all parts of the country. It was before daylight was shed upon any part of our military operations. We adopted the legal tender clause then as an absolute expedient. Remembering the debate, I know with what slow steps the majority of the Senate came to the necessity of adopting legal tenders."

The debt of the United States on the 31st of August, 1866, when it reached its maximum, amounted to $2,844,649,627. On the 1st of March, 1870, the debt had been reduced to less than $2,500,000,000, of which about $400,000,000 was in United States notes, for the redemption of which no provision was made. It was the confident expectation of Congress, which proved to be correct, that before the refunding operations were complete, the debt would be gradually reduced, so that the sum of $1,500,000,000, provided for in the law, would be sufficient to refund all existing debts, except United States notes, into the new securities.

The process of refunding progressed slowly, was confined to the five per cent. bonds, and was somewhat interrupted by the financial stringency of 1873.

By the act approved January 20, 1871, the amount of five per cent. bonds authorized by the act approved July 14, 1870, was increased to $500,000,000, but the act was not to be construed to authorize any increase of bonds provided for by the refunding act.

Prior to the 24th of August, 1876, there had been sold, for refunding purposes, the whole of the $500,000,000 five per cents. authorized by that act, and on that day Lot M. Morrill, Secretary of the Treasury, entered into a contract for the sale of $40,000,000 of the four and a half per cent. bonds authorized by the refunding act. By this process of refunding an annual saving had been made of $5,400,000 a year, by the reduction of interest in the sale of $540,000,000 bonds. On the 9th day of June, 1877, I, as Secretary of the Treasury, terminated the contract made by Mr. Morrill, my predecessor, and placed on the market the four per cent. bonds provided for by the refunding act. The subsequent proceedings under this act will be more appropriately referred to hereafter.

The more difficult problem remained of advancing United States notes to par in coin. This could be accomplished by reducing the amount of these notes outstanding, and, thus, by their scarcity, add to their value. They were a legal tender in payment for all debts, public and private, except for duties on imported goods and interest on the public debt. As long as these notes were at a discount for coin they could circulate only in the United States, and until they were at par with coin, coin would not circulate as money in the United States, except to pay coin liabilities. The notes were a dishonored, depreciated promise, the purchasing power of which varied day by day, the football of "bulls and bears." In many respects these notes were better than any other form of depreciated paper money, for the people of the United States had full confidence in their ultimate redemption. They were much better and in higher favor with the people than the state bank notes which they replaced and which were not only depreciated like United States notes but had been often proven worthless in the hands of innocent holders. They were as good as national bank notes, however well secured, for these notes were not payable in coin, but could be redeemed by United States notes. Still, with all their defects the United States notes were the favorite money of the people, and any attempt to contract their volume was met by a strong popular opposition.

As already stated, the gradual reduction of the volume of United States notes, urged so strongly by Secretary McCulloch, and provided for by the resumption act, met with popular opposition and was repealed by Congress. Under these conditions it became necessary to approach the specie standard of value without a contraction of the currency. The act to strengthen the public credit, already referred to, was the beginning of this struggle. The government was, by this act, committed to the payment of the United States notes in coin or its equivalent. But when and how was not stated or even considered. The extent to which Congress would then go, and to which popular opinion would then consent, was the declaration that the "United States solemnly pledges its faith to make provision at the earliest practicable period for the redemption of United States notes, in coin." Many events must occur before the fulfillment of this promise could be attempted.

CHAPTER XXII. OUR COINAGE BEFORE AND AFTER THE WAR. But Little Coin in Circulation in 1869--General Use of Spanish Pieces--No Mention of the Dollar Piece in the Act of 1853--Free Circulation of Gold After the 1853 Act--No Truth in the "Demonetization" Charge--Account of the Bill Revising the Laws Relative to the Mint, Assay Offices and Coinage of the United States--Why the Dollar was Dropped from the Coins--Then Known Only as a Coin for the Foreign Market--Establishment of the "Trade Dollar"--A Legal Tender for Only Five Dollars--Repeated Attempts to Have Congress Pass a Free Coinage Act--How It Would Affect Us--Controversy Between Senator Sumner and Secretary Fish.

At the date of the passage of the act "to strengthen the public credit," on March 19, 1869, there was but little coin in circulation in the United States except gold coin, and that was chiefly confined to the Pacific coast, or to the large ports of entry, to be used in payment of duties on imported goods. Silver coins were not in circulation. The amount of silver coined in 1869 was less than one million dollars and that mainly for exportation. Fractional notes of different denominations, from ten to fifty cents, were issued by the treasury to the amount of $160,000,000, of which $120,000,000 had been redeemed, and $40,000,000 were outstanding in circulation or had been destroyed. These fractional notes superseded silver coin as United States notes superseded gold coin. The coinage laws as they then existed were scattered through the laws of the United States from 1793 to 1853, and were in many respects imperfect and conflicting.

The ratio fixed by Alexander Hamilton, of fifteen ounces of silver as the equivalent of one ounce of gold, was, at the time it was adopted, substantially the market ratio, but the constant tendency of silver to decline in relative value to gold had been going on for years and it continued to decline, almost imperceptibly perhaps, and the legal ratio in France having been fixed at fifteen and a half to one, there was an advantage in shipping gold to that country from this, and consequently very little if any of our gold, even if coined, came into circulation. By the act of 1793 foreign coins were made a legal tender for circulation in this country, and the Spanish silver dollar, on which ours was founded, with the 8th or "real" pieces, found great favor. Singularly enough, in Mexico and the West Indies, the Spanish population would exchange their dollars for ours, dollar for dollar, although their pieces, if not worn, were each three grains heavier. This led to an exchange of our dollars for the Spanish ones, which were promptly recoined at the mint at a fair profit to the depositor.

This put upon the government the expense of manufacturing coins with no advantage. The evil grew so great that in 1806 the further coinage of our silver dollars was prohibited by President Jefferson, in an order issued through the state department, as follows:

"Department of State, May 1, 1806. "Sir:--In consequence of a representation from the director of the Bank of the United States, that considerable purchases have been made of dollars coined at the mint for the purpose of exporting them, and as it is probable further purchases and exportations will be made, the President directs that all the silver to be coined at the mint shall be of small denominations, so that the value of the largest pieces shall not exceed half a dollar.

"I am, etc., "James Madison. "Robert Patterson, Esq., Director of the Mint."

The coinage of the silver dollar at our mint was not resumed until 1836. The small and worn Spanish pieces, being legal tender, also drove from circulation our fractional coins coming bright and plump from the mint. Bank notes and these worn pieces furnished the circulation of the country.

The condition of the currency became so objectionable that in 1830 the subject was taken up by a special committee of the House of Representatives, appointed for the purpose. Three reports were submitted, in one of which the committee stated that of $37,000,000 coined at our mints only $5,000,000 remained in circulation. A bill was submitted to the House fixing the ratio at 15.625 to one, and was strongly urged. There appeared no special opposition to the measure for a time, but the feeling of opposition to the circulation of bank bills had become very strong among the people and was reflected by the administration.

In the Senate the opposition to bank bills was headed by Thomas H. Benton, who openly advocated so changing the coinage ratio that gold would circulate to the exclusion of the notes, and perhaps incidentally of silver also. The matter of providing for silver, however, received little attention. The ratio was changed to sixteen to one, John Quincy Adams and Daniel Webster joining with Calhoun and Benton in bringing it about. It was well understood at the time that the operation of this act would banish silver. The object of the change was distinctly stated, especially by Mr. Benton, who said:

"To enable the friends of gold to go to work at the right place to effect the recovery of that precious metal, which their fathers once possessed; which the subjects of European kings now possess; which the citizens of the young republics to the south all possess; which even the free negroes of San Domingo possess; but of which the yeomanry of America have been deprived for more than twenty years, and will be deprived forever, unless they discover the cause of the evil and apply the remedy to its root."

By the act of 1834, superadded to by the act of 1837, the ratio of sixteen to one instead of fifteen to one was adopted. The result was that gold coins were largely introduced and circulated; but as sixteen ounces of silver were worth more than one ounce of gold, the silver coins disappeared, except the depreciated silver coin of other countries, then a legal tender. To correct this evil, Congress, on the 21st of February, 1853, provided for the purchase of silver bullion by the government, to be coined by it and not for the owners of the bullion. That was the first time the government had ever undertaken to buy bullion for coinage purposes. It provided for the purchase of silver bullion and the coinage of subsidiary silver coins at the ratio of less than fifteen to one. No mention was made of the dollar in the act of 1853. It had fallen into disuse and when coined was exported, being more valuable as bullion than as coin.

As the value of the minor coins was less that gold at the coinage ratio, they were limited as a legal tender to five dollars in any one payment. They were, in fact, a subsidiary coin made on government account, and, from their convenience and necessity, were maintained in circulation. They were similar to the coins now in use, revived and re-enacted by the resumption act of 1875.

It was not the intention of the framers of this law to demonetize silver, because they were openly avowed bimetallists, but it limited coinage to silver bought by the government at market price. They saw, in this expedient, a way in which silver could be more generally utilized than in any other. Mr. R. M. T. Hunter, an avowed bimetallist, in a report to the United States Senate, said:

"The mischief would be great indeed if all the world were to adopt but one of the precious metals as the standard of value. To adopt gold alone would diminish the specie currency more than one-half; and the reduction the other way, should silver be taken as the only standard, would be large enough to prove highly disastrous to the human race."

He evidently did not consider the purchase of silver bullion at its coinage value by the government, instead of the free coinage of silver, as monometallism.

After the passage of the act of 1853, gold in great quantities, the produce of the mines of California, was freely coined at the ratio of sixteen to one, and was in general circulation. If, then, the purchase of silver, instead of the free coinage of silver, is the demonetization of silver, it was demonetized practically in 1834, and certainly in 1853, when the purchase of silver and its use as money increased enormously. In 1852 the coinage of silver was less than $1,000,000. In the next year the coinage of silver rose to over $9,000,000, and reached the aggregate of nearly $50,000,000 before the beginning of the Civil War. Then, as now, the purchase of silver bullion led to a greater coinage than free coinage.

This was the condition of our coinage until the war, like all other great wars in history, drove all coins into hoarding or exportation, and paper promises, great and small, from five cents to a thousand dollars, supplanted both silver and gold.

When, therefore, it became necessary to prepare for the coinage of gold and silver to meet the requirements of the act of 1869, "to strengthen the public credit," it was deemed by the treasury department advisable to revise and codify the coinage laws of the United States. Mr. Boutwell, then Secretary of the Treasury, with the assistance of John Jay Knox, deputy comptroller, afterwards comptroller, of the currency, and the officers of the mints of the United States, prepared a complete code of the coinage laws. It was submitted to experts, not only to those in the treasury but also to all persons familiar with the subject. The bill was entitled, "An act revising and amending the laws relative to the mint, assay offices, and coinage of the United States."

The law, tested by experience, is conceded to be an excellent measure. A single provision of the bill has been the subject of charges and imputations that the silver dollar was, in a fraudulent and surreptitious way, "demonetized" by this act. There is not the slightest foundation for this imputation. The bill was sent to me as chairman of the committee on finance, and submitted to the Senate with this letter:

"Treasury Department, April 25, 1870. "Sir:--I have the honor to transmit herewith a bill revising the laws relative to the mint, assay offices, and coinage of the United States, and accompanying report. The bill has been prepared under the supervision of John Jay Knox, deputy comptroller of the currency, and its passage is recommended in the form presented. It includes, in a condensed form, all the important legislation upon the coinage, not now obsolete, since the first mint was established, in 1792; and the report gives a concise statement of the various amendments proposed to existing laws and the necessity for the change recommended. There has been no revision of the laws pertaining to the mint and coinage since 1837, and it is believed that the passage of the inclosed bill will conduce greatly to the efficiency and economy of this important branch of the government service.

"I am, very respectfully, your obedient servant, "Geo. S. Boutwell, Secretary of the Treasury. "Hon. John Sherman, "Chairman Finance Committee, United States Senate."

Section 15 of the original bill omitted the silver dollar. It was as follows:

"Sec. 15. And be it further enacted, That of the silver coin, the weight of the half dollar, or piece of 50 cents, shall be 192 grains; and that of the quarter dollar and dime shall be, respectively, one-half and one-fifth of the weight of said half dollar. That the silver coin issued in conformity with the above section shall be a legal tender in any one payment of debts for all sums less than one dollar."

Section 18 prohibited all coins except those named, as follows:

"Sec. 18. And be it further enacted, That no coins, either gold, silver, or minor coinage, shall hereafter be issued from the mint other than those of the denominations, standards, and weights herein set forth."

Special attention was called to the dropping out of the silver dollar, both by Secretary Boutwell and Mr. Knox, and the opinion of experts was invited and given on this special matter and communicated to Congress. These sections, in the three years that the bill was pending in Congress, were changed either in the House or Senate in only one or two unimportant particulars.

Accompanying the report of Mr. Knox were the statements of Robert Patterson, of Philadelphia, confessedly one of the ablest scientists and metallists in the United States, in favor of dropping from our coinage the silver dollar. Dr. Linderman, the director of the mint, made the same recommendation. In the report accompanying the introduction of the bill, under date of April 25, 1870, Comptroller Knox gives the history of the silver dollar and the reasons for its discontinuance as follows:

"The dollar unit, as money of account, was established by the act of Congress April 2, 1792, and the same act provides for the coinage of a silver dollar, 'of the value of a Spanish milled or pillar dollar, as the same is now current.' The silver dollar was first coined in 1794, weighing 416 grains, of which 371¼ grains were pure silver, the fineness being 892.4. The act of January 18, 1837, reduces the standard weight to 412½ grains, but increases the fineness to 900, the quantity of pure silver remaining 371¼ grains as before, and at these rates it is still coined in limited amounts."

He then says:

"The coinage of the silver dollar piece, the history of which is here given, is discontinued in the proposed bill. It is, by existing law, the dollar unit, and assuming the value of gold to be fifteen and one-half times that of silver, being about the mean ratio for the past six years, is worth in gold a premium of about three per cent. (its value being 103.12) and intrinsically more than seven per cent. premium in our other silver coin, its value thus being 107.42. The present laws consequently authorize both a gold dollar unit and a silver dollar unit, differing from each other in intrinsic value. The present gold dollar piece is made the dollar unit in the proposed bill, and the silver dollar piece is discontinued. If, however, such a coin is authorized, it should be issued only as a commercial dollar, not as a standard unit of account, and of the exact value of the Mexican dollar, which is the favorite for circulation in China and Japan and other oriental countries.

"Note.--Assuming the value of gold to be fifteen and one-half times that of silver, the French 5-franc piece is worth about 96½ cents (96.4784); the standard Mexican dollar 104.90, our silver dollar piece 103.12, and two of our half-dollar pieces 96 cents."

The finance committee carefully examined the bill. We were not in any hurry about it. It was sent to us in April, 1870, and was printed and sent, by order of the Senate, to everyone who desired to read it or look over it.

That committee was composed of Messrs. Sherman, Williams, Cattell, Morrill, Warner, Fenton and Bayard.

The bill was reported unanimously to the Senate December 19, 1870, after lying in the committee room for eight months.

The dollar was dropped from the coins in the bill framed in the treasury department. It was then an unknown coin. Although I was quite active in business which brought under my eye different forms of money, I do not remember at that time ever to have seen a silver dollar. Probably if it had been mentioned to the committee and discussed it would have been thought, as a matter of course, scarcely worthy of inquiry. If it was known at all, it was known as a coin for the foreign market.

No one proposed to reissue it. The Pacific coast had six intelligent, able, and competent Senators on the floor of the Senate. They would have carefully looked out for the interest of silver, if the bill affected them injuriously. The authority given in the bill as it finally passed for coining the so-called trade dollar, met all the demands of the silver producing states. But the silver dollar at that time was worth more than the gold dollar. California and Nevada were on the gold standard.

The bill was printed over and over again, finally reported, and brought before the Senate. It was debated there for three days. Every Senator from the Pacific coast spoke upon the measure. Representing the committee, I presented the questions as they occurred from time to time, until finally we differed quite seriously upon the question of a charge for the coinage of gold. The only yea and nay vote in the Senate on the passage of that bill, after two days debate, occurred on the 10th of January, 1871. Those who voted in favor of the bill were Messrs. Bayard, Boreman, Brownlow, Casserly, Cole, Conkling, Corbett, Davis, Gilbert, Hamlin, Harlan, Jewett, Johnston, Kellogg, McCreary, Morton, Nye, Patterson, Pomeroy, Pool, Ramsey, Rice, Saulsbury, Spencer, Stewart, Stockton, Sumner, Thurman, Tipton, Trumbull, Vickers, Warner, Willey, Williams, Wilson and Yates--36.

Every one of the six members of the Pacific coast voted for the bill after full debate.

Against this bill were Messrs. Abbott, Ames, Anthony, Buckingham, Carpenter, Chandler, Fenton, Hamiliton, of Texas, Harris, Howell, Morrill, of Vermont, Pratt, Scott and Sherman--14.

So on the only yea and nay vote which was ever taken upon the bill I voted against it. It was not on account of demonetizing the silver dollar. I did not do it because of that, but I did it because gold was then only coined for the benefit of private depositors; we were not using gold except for limited purposes. Gold was the standard in California, and we thought the people of that state ought to continue to pay the old and reasonable rate for coinage of one-fifth of one cent to the dollar. No action was taken on the bill in the House of Representatives, and it failed to pass during that Congress. At the beginning of the next Congress the bill was introduced by Wm. D. Kelley, and reported by him favorably to the House of Representatives. It gave rise to considerable debate, especially the section defining the silver coins. No one proposed to restore the old silver dollar, but the House inserted a coin precisely the equivalent of five francs, or two half dollars of our subsidiary coin, and this franc dollar, as it was called, was made, like other subsidiary coins, a legal tender only for five dollars. On the 9th of April, 1872, Mr. Hooper, having charge of the bill, called especial attention to the dropping of the old dollar and the substitution of the French dollar. He said, on April 9, 1872:

"Section 16 re-enacts the provisions of existing laws defining the silver coins and their weights, respectively, except in relation to the silver dollar, which is reduced in weight from 412½ to 384 grains; thus making it a subsidiary coin in harmony with the silver coins of less denomination, to secure its concurrent circulation with them. The silver dollar of 412½ grains, by reason of its bullion and intrinsic value being greater than its nominal value, long since ceased to be a coin of circulation, and is melted by manufacturers of silverware. It does not circulate now in commercial transactions with any country, and the convenience of those manufacturers, in this respect, can better be met by supplying small stamped bars of the same standard, avoiding the useless expense of coining the dollar for that purpose. The coinage of the half dime is discontinued for the reason that its place is supplied by the copper nickel five-cent piece, of which a large issue has been made, and which, by the provisions of the act authorizing its issue, is redeemable in United States currency."

When the bill was sent to the Senate it, in compliance with the memorial of the legislature of the State of California, inserted in place of the French dollar, of 384 grains of standard silver, a dollar containing 420 grains of standard silver, called the "trade dollar." This was urged upon the ground that, as the Mexican dollar contained 416 grains, or 3½ grains more than the old silver dollar, it had an advantage in trade with China and Japan over our dollar, and that a coin containing a few grains more than the Mexican dollar would give our people the benefit of this use for silver. This dollar was, in conference, agreed to by the House, but was a legal tender for only five dollars. On final action on that bill, the conferees on the part of the Senate were Messrs. Sherman, Scott and Bayard. The amendment of the Senate adopting the trade dollar was agreed to by the House, and the bill passed in both Houses without a division.

There never was a bill proposed in the Congress of the United States which was so publicly and openly presented and agitated. I know of no bill in my experience which was printed, as this was, thirteen times, in order to invite attention to it. I know no bill which was freer than any immoral or wrong influence than this act of 1873.

During the pendency of this bill, the Senators and Representatives from the Pacific coast were in favor of the single standard of gold alone. This was repeatedly shown during the debates, but now they complain that the silver dollar was demonetized, and that, though present, taking the most active interest in the consideration of the bill, they did not observe that the silver dollar was dropped from the coinage. The public records are conclusive against this pretense. Mr. Stewart, Senator from Nevada, and all the Senators from the Pacific coast, who took an active part in the debate on the bill, must have known of the dropping of the silver dollar from the coinage. It appears from the "Congressional Record" that, on the 11th of February, 1874, Mr. Stewart said:

"I want the standard gold, and no paper money not redeemable in gold; no paper money the value of which is not ascertained; no paper money that will organize a gold board to speculate in it."

Again, only a few days after this, on the 20th of February, when he was speaking in favor of the resolution, instructing the committee on finance to report a bill providing for the convertibility of treasury notes into gold coin of five per cent. bonds, he said:

"By this process we shall come to a specie basis, and when the laboring man receives a dollar it will have the purchasing power of a dollar, and he will not be called upon to do what is impossible for him or the producing classes to do, figure upon the exchanges, figure upon the fluctuations, figure upon the gambling in New York; but he will know what his money is worth. Gold is the universal standard of the world. Everybody knows what a dollar in gold is worth."

To review the history of the act of 1873: It was framed in the treasury department after a thorough examination by experts, transmitted to both Houses of Congress, thoroughly examined and debated during four consecutive sessions, with information called for by the House of Representatives, printed thirteen times by order and broadly circulated, and many amendments were proposed, but no material changes were made in the coinage clause from the beginning to the end of the controversy. It added the French dollar for a time, but that was superseded by the trade dollar, and neither was made a legal tender but for five dollars. It passed the Senate on the 10th of January, 1871--36 yeas and 14 nays--every Senator from the Pacific coast voting for it.

It was introduced in the House of Representatives by Mr. Kelley, at the next session. It was debated, scrutinized, and passed unanimously, dropping the silver dollar, as directly stated by Mr. Hooper. It was reported, debated, amended, and passed by the Senate unanimously. In every stage of the bill, and every print, the dollar of 412½ grains was prohibited, and the single gold standard recognized, proclaimed, and understood. It was not until silver was a cheaper dollar that anyone demanded it, and then it was to take advantage of a creditor.

It has always been within the power of Congress to correct this error, if error was made; but Congress has refused over and over again to do it. When the controversy arose, in 1878, on the Bland bill, and the House of Representatives proposed the free coinage of silver, the Senate rejected it after a deliberate contest, and substituted in place of it what is called the Bland-Allison act, which required the purchase, by the government, of silver bullion at its market value, and its coinage to a limited amount. Every effort has been made, from that time to this, to have the Congress of the United States pass a free coinage act.

If this is done, it will be to secure a cheaper dollar of less purchasing power, with the view to enable debtors to pay debts, contracted on the basis of gold coin, with silver coins, worth, with free coinage, less than one-half of gold coins.

In reviewing, at this distance of time, the legislation of 1873, in respect to the coinage of silver, I am of the opinion that it was fortunate that the United States then dropped the coinage of the old silver dollar. No one then contemplated the enormous yield of silver from the mines, and the resulting fall in the market value of silver, but, acting upon the experience of the past, that a parity between silver and gold could not be maintained at any fixed value, Congress adopted gold as the standard of value, and coined silver as a subsidiary coin, to be received and maintained at a parity with gold, but only a legal tender for small sums. This was the principle adopted in the act of 1853, when silver was more valuable than gold at the legal ratio. Silver was not then coined into dollars, because it was then worth more as bullion than as coin. It was needed for change, and, under the law of 1853, it was furnished in abundance. Similar laws are now in force in all countries where gold is the sole standard. Under these laws, a larger amount of silver is employed as subsidiary coins than when the coinage of silver was free.

The same condition of coinage now exists in the United States. While silver is reduced in market value nearly one-half, silver coins are maintained at par with gold at the old ratio, by fiat of the government. It is true that the purchase of silver, under recent laws, involved a heavy loss to the government, but the free coinage of silver, under the ratio of sixteen to one, would exclude gold from our currency, detach the United States from the monetary standard of all the chief commercial nations of the world, and change all existing contracts between individuals and with the government. In view of these results, certain to come from the free coinage of silver, I am convinced that until some international arrangement can be made, the present system of coinage should continue in force. This has now became a political, or, rather a monetary question, to be decided sooner or later, by popular opinion, at the polls. This subject will be further discussed at a later period, when efforts were made to adopt the free coinage of silver at the old ratio.

Prior to the meeting of Congress in December, 1870, a controversy had arisen between Senator Sumner and Secretary Fish, which created serious embarrassment, and I think had a very injurious influence during that and succeeding sessions of Congress. Mr. Sumner had long been chairman of the committee on foreign relations, and no doubt exercised a domineering power in this branch of the public service. Mr. Fish and Mr. Sumner had differed widely in respect to the annexation of San Domingo and certain diplomatic appointments and former treaties, among them the highly important English negotiations for the settlement of claims growing out of the war. On these topics the President and Mr. Sumner could not agree. Mr. Sumner insisted that the hasty proclamation by Great Britain of neutrality between the United States and the Southern Confederacy was the gravamen of the Alabama claims. The President and Mr. Fish contended that this proclamation was an act of which we could not complain, except as an indication of an unfriendly spirit by Great Britain, and that the true basis of the Alabama claims was that Great Britain, after proclaiming neutrality, did not enforce it, but allowed her subjects to build cruisers, and man, arm and use them, under cover of the rebel flag, to the destruction of our commercial navy.

This difference of opinion between the President and Mr. Sumner led to the removal of John L. Motley, our minister to England, who sided with Sumner, and unquestionably intensified the feeling that had arisen from the San Domingo treaty.

As to that treaty it was a conceded fact that before the President had become publicly committed to it he had, waiving his official rank, sought the advice and counsel of Mr. Sumner, and was evidently misled as to Mr. Sumner's views on this subject. The subsequent debating, in both open and executive session, led to Mr. Sumner's taking the most extreme and active opposition to the treaty, in which he arraigned with great severity the conduct of the naval officers, the Secretary of the Navy, Mr. Fish and the President. This was aggravated by alleged public conversations with Mr. Sumner by "interviewers," in which the motives of the President and others were impugned.

In the meantime, social relations between the Secretary of State and Mr. Sumner had become impossible; and--considering human passion, prejudice and feeling--anything like frank and confidential communication between the President and Mr. Sumner was out of the question.

A majority of the Republican Senators sided with the President. We generally agreed that it was a false-pretended neutrality, and not a too hasty proclamation of neutrality, that gave us an unquestionable right to demand indemnity from Great Britain for the depredations of the Alabama and other English cruisers. And as for the San Domingo treaty, a large majority of Republican Senators had voted for it--though I did not; and nearly all of us had voted for the commission of inquiry of which Mr. Wade was the chief member.

When we met in March, it was known that both these important subjects would necessarily be referred to the committee on foreign relations, and that, aside from the hostile personal relations of Mr. Sumner and the Secretary of State, he did not, and could not, and would not, represent the views of a majority of his Republican colleagues in the Senate, and that a majority of his committee agreed with him. Committees are and ought to be organized to represent the body, giving a majority of the members to the prevailing opinion, but fairly representing the views of the minority. It has been the custom in the Senate to allow each party to choose its own representatives in each committee, and in proportion to its numbers.

In the Republican conference the first question that arose was as to Mr. Sumner. He was the oldest Senator in consecutive service. He was eminent not only as a faithful representative of Republican principles, but as especially qualified to be chairman of our foreign relations. He had long held that position, and it was not usual in the Senate to change the committees, but to follow the rule of seniority, placing Senators of the majority party in the order of their coming into the Senate and those of the minority at the foot of the list.

In deciding Mr. Sumner's case, in view of the facts I have stated, two plans were urged;

First--To place him at the head of the new and important committee of privileges and elections, leaving the rest of the committee on foreign relations to stand in the precise order it had been, with one vacancy to be filled in harmony with the majority.

Second--To leave Mr. Sumner to stand in his old place as chairman, and to make a change in the body of the committee by transferring one of its members to another committee, and fill the vacancy by a Senator in harmony with the majority.

My own opinion was that the latter course was the most polite and just; but the majority decided, after full consideration and debate, upon the first alternative.

Simon Cameron was next to Mr. Sumner on the list of Republican members of the committee, and, by uniform usage, became its chairman.

This affair created feeling in the Senate which it is difficult now to realize, but it was decided in a Republican caucus, in which there was an honest difference of opinion. We foresaw, whichever way it should be decided, that it would create--and it did create --bad feeling among Senators, which existed as long as Mr. Sumner lived. I think it proper to make this statement of my own views at the time, though by the happening of great events this incident has almost passed out of memory.

Mr. Sumner died in Washington, March 11, 1874. He was distinguished for his literary attainments, and his strong opposition to the institution of slavery and his severe arraignment of it. The brutal attack made upon him by Preston S. Brooks created profound sympathy for him.

CHAPTER XXIII. SOME EVENTS IN MY PRIVATE LIFE. Feuds and Jealousies During Grant's Administration--Attack on Me by the Cincinnati "Enquirer"--Reply and Statement Regarding My Worldly Possessions--I Am Elected to the Senate for the Third Term --Trip to the Pacific with Colonel Scott and Party--Visit to the Yosemite Valley--San Diego in 1872--Return via Carson City and Salt Lake--We call on Brigham Young--Arrival Home to Enter Into the Greeley-Grant Canvass--Election of General Grant for the Second Term.

I have purposely followed the legislation of Congress on financial questions until the passage of the act of 1873, passing over other events in my personal history and that of President Grant.

It can hardly be said that we had a strictly Republican administration, during his two terms. While Republicans were selected to fill the leading offices, the policy adopted and the controlling influence around him were purely personal. He consulted but few of the Senators or Members, and they were known as his personal friends. Mr. Conkling, by his imperious will, soon gained a strong influence over the President, and from this came feuds, jealousies and enmities, that greatly weakened the Republican party and threatened its ascendency. This was a period of bitter accusations, extending from the President to almost everyone in public life. During the entire period of Grant's administration, I was chairman of the committee on finance of the Senate, and had to act upon all questions of taxation, debt, banking or finance, and had occasion to talk with the President upon such measures, but he rarely expressed any opinion or took any interest in them. His veto of the bill to increase the amount of United States notes, on the 22nd of April, 1874, was an exception, but on this he changed his mind, as he had expressed his approval of the bill when pending. He was charged with being in a whisky ring and with other offensive imputations, all of which were without the slightest foundation. General Grant was, in every sense of the word, an honest man. He was so honest that he did not suspect others, and no doubt confided in, and was friendly with, those who abused his confidence. It was a period of slander and scandal.

I did not escape the general crimination. I usually met accusations with silence, as my accusers were answered by others. In March, 1871, the Cincinnati "Enquirer" contained the following imputation:

"We are informed that a gentleman who lately filled a responsible office in this city, who has recently returned from Washington, says that the Southern Railroad bill would have passed the United States Senate if it had not, unfortunately, happened that Senator Sherman had no direct pecuniary interest in it. In these days, and with such Congresses, it takes grease to oil the wheels of legislation."

On the 12th of March I wrote to the editors of the "Enquirer" the following note, after quoting the editorial:

"United States Senate Chamber,} "Washington, March 12, 1871. } "To the Editors of the 'Enquirer:'

"Gentlemen:--Some one, perhaps in your office, sends me the following editorial, cut from your paper:

* * * * *

"All I can say in reply is that it contains a falsehood and a calumny. I introduced the bill for the Southern Railroad; am strongly in favor of it, and pressed it at every stage as rapidly as the rules of the Senate and the strong opposition to it would allow. This is known by every Senator, and I am quite sure Judge Thurman and Mr. Davis would say so. I alone took an active interest in the bill, and at the very moment your editorial was received I was pressing a Republican caucus to make it an exception to a resolution not to take up general legislation at this session. Everyone familiar with our rules knew that it was the sheerest folly to try to pass the bill on the last day of the session, especially as against our appropriation bills. When it does pass it will take days of debate, and will not receive support from any of your political associates, who think Kentucky can block up all intercourse between the north and south. Still I yielded to the earnest desire of the trustees to try to get a vote, but failed to get the floor at 3 o'clock in the morning, the only moment it was possible to submit even the motion to take it up. The bill to abolish the duty of coal was taken up and was not acted on, nor would the railroad bill, or any other contested bill, have passed at that stage of the session.

"As to the base imputation you attribute to 'a gentleman who lately filled a responsible office in this city,' I can only say that, whether it originates with you or anyone else, it is utterly false. Neither in this nor in any measure that has passed Congress, or is pending, have I had any direct pecuniary interest. I respectfully ask that you print this, and also the name of the 'gentleman' you refer to.

"I intend, in the interests of the city of Cincinnati and of the whole country, to press the Southern Railroad bill, and to secure its passage as soon as possible, but it is rather poor encouragement to read such libels in a prominent paper in your city.

"Yours etc., "John Sherman."

This was followed by an article in the "Enquirer" embodied in my reply, as follows:

"Washington, March 20, 1871. "Gentlemen:--In your editorial in the 'Enquirer' of March 17, in commenting on my card to you as to my action on the Cincinnati Southern Railroad bill, you repeat my statement that 'neither in this nor in any measure that has passed Congress, or is pending, have I any pecuniary interest,' and you say:

'If this is true, he has certainly been a very badly slandered gentleman. Somehow or other there is a popular impression that Mr. Sherman has contrived to make his connection with politics a highly lucrative business, and that he has exhibited, since he has been in Congress, a worldly thrift that is remarkable. There is a further impression that he is now a very rich man, whereas, a few years ago, before he was in public affairs, his circumstances were decidedly moderate. Perhaps our senatorial friend may not be aware of the existence of these derogatory reports, and will thank us for giving him an opportunity, now that he knows of their existence, to disprove them.'

"I have not been ignorant that there has been a studied effort-- ascribed by me to the common tactics of political warfare--to create the impression, by vague innuendo, that I have used my official position to make money for myself. I know that this charge or imputation is without the slightest foundation, and I now repeat that I never was pecuniarily interested in any question, bill or matter before Congress; that I never received anything in money, or property, or promise, directly or indirectly, for my vote or influence in Congress or in the departments; that I have studiously avoided engaging in any business depending upon legislation in Congress. The only enterprise in which I ever engaged, which rests upon an act of Congress, is that in 1862, after the bill passed authorizing the construction of a street railroad in this city, I, with others, openly subscribed stock, and undertook to build it in pursuance of the act of Congress.

"From the position assigned me here, I have had to deal with great questions involving our financial system of currency, taxes and debt, and I can appeal to all my associates in Congress, to each of the eminent men with whom, as Secretaries of the Treasury, I have been intimate, and to every man of the multitude with whom I have been brought into contact, to say whether I have ever been influenced in my course by pecuniary interest.

"But you say that the impression is that I am a very rich man, whereas, before I was in public affairs, my circumstances were decidedly moderate. This allegation contains two gross exaggerations. When I entered public life, I was largely engaged in my profession and other lucrative business. If I had not engaged in politics, I might have been the rich man you suppose. I am not this day relatively richer, considering the changed value of property, than I was when I entered the Senate. Some time ago it was stated in your paper that I was worth millions. A very small fraction, indeed, of one million dollars will cover all I am worth. My property consists mainly of real estate, palpable to the eye, and the rest of it is chiefly in a railroad with which I was connected before I entered public life.

"I have managed my business affairs with reasonable care, prudence, economy and success. What I have is the result of this.

"You kindly offer me an opportunity to disprove to you these reports. Well, how can I? What charge is made against me? How can I fight shadows? How can a man prove himself innocent against an innuendo?

"But as you offer me the opportunity, I now invite Mr. Faran to come to my home at Mansfield, and I will show him all I possess there, and render him a full account of all I have elsewhere, and if I can't fairly account for it without being suspected of receiving bribes, or gifts, or stealing, then he can repeat these baseless accusations with an easy conscience.

"You may ask why I have not met these derogatory reports before. Perhaps I ought, but I feel the humiliation of such a controversy, and thought it time enough when a specific charge was made. And I am told by Mr. Hedges, my former law partner, that in my absence, last summer, he corrected some gross misstatements in your paper about me, and that you refused or neglected to publish it--even to notice it. As, however, you now, in a courteous way, invite this letter, I take great pleasure in accepting your offer.

"Very truly yours, "John Sherman. "Messrs. Faran & McLean, editors of the 'Enquirer.'"

I doubted the policy of my publishing such a letter, or of taking any notice of so indefinite a charge, but the response from the press was fair, especially from the "Shield and Banner," a Democratic paper printed in Mansfield, as follows:

"We publish a letter of Hon. John Sherman to the editors the Cincinnati 'Enquirer.' It is hardly necessary that we should say that we have no sympathy with the political creed of John Sherman. Between him and us there is a vast and wide difference; but we are not, we trust, so much of the partisan that we cannot do justice to a neighbor, if that neighbor differs with us. We have known John Sherman, not only during all his public life, but from the time we became a resident of Mansfield, now covering a period of thirty years, and we have always known him as industrious, prudent and careful in his profession, and economical and thrifty in his business. We placed very little credence in the rumors that he was a man of immense wealth. His property is mostly in real estate. He was fortunate in getting hold of very desirable property in and around our city, and the advance in that has doubtless given him a competence; but it is folly to charge him with being a millionaire. We have, in common with our neighbors, enjoyed his hospitality, and his style of living is neither extravagant nor ostentatious.

"Mr. Sherman is one of our townsmen, and although all wrong as a politician and statesman, and holding to a creed we utterly disapprove, he is a highminded and honorable man, and we are bound to accept his statement about his pecuniary affairs as true."

I have often since been accused of the crime of "being rich," but as nearly all my possessions are visible to the naked eye, and their history and acquisition are known to so many, I think I am not required to prove that I have not made them as the result of legislation or my holding public trusts.

My second term in the Senate expired on the 4th of March, 1873. The election of my successor devolved upon the legislature that convened on the first Monday of January, 1872.

The canvass in Ohio, in the summer and fall of 1871, was an active and exciting one and attracted great interest in other states. The result would indicate the strength or weakness of Grant's administration. I felt it was necessary, not only for my re- election, but for the success of the Republican party, that every effort should be made to elect a Republican majority in the legislature, and I, therefore, at the state convention and in most of the congressional districts of Ohio, made earnest speeches in behalf of the state ticket and members of the legislature. I received many letters of encouragement, one of which, from Senator Carpenter in reference to my speech in the convention, I insert:

"Washington, D. C., July 20, 1871. "Hon. John Sherman.

"Dear Sir:--I have just read your speech to the state convention of Ohio. It is splendid. The only fault I have to find with it is, that you have covered the whole ground and reduced us 'lesser lights' to the necessity of repeating and elaborating. This is very mean of you; you might have left some topic of the next campaign untouched, for us to dwell upon. But you have pre-empted everything and we must follow after.

"Very truly yours, "Matt H. Carpenter."

The legislature was elected in October, 1871, but the majority for the Republicans was so small that the election of a Republican Senator was in doubt.

I received many hearty letters of congratulation on our success in Ohio from my colleagues in the Senate, among them one from Senator Conkling as follows:

"Utica, N. Y., October 13, 1871. "Hon. John Sherman, Mansfield, Ohio.

"My Dear Sir:--Having waited for certainties touching your election and the legislature, and having watched the canvass with sincere solicitude, I congratulate you most heartily upon the result.

"Your own speeches have been among the best you ever made, and your canvass has been full of the pluck without which no canvass and no political contest is thorough or truthful.

"This state is ours unless the people are discouraged from voting in the country by the belief that with Tammany to count, it matters not what majority rolls up above the Highlands.

"Notwithstanding the grievous statements of the 'Tribune' and inspired by the 'Tribune,' we have done nothing harsh to the anti-administration minority, but the least and mildest thing which would prevent a split in our organization with trouble for the future, and probably a double delegation in the next national convention.

"Yours sincerely, "Roscoe Conkling."

It was conceded that a decided majority of the Republican members of the legislature were in favor of my re-election, but it was believed that an effort would be made by five Republican members to combine with the Democratic members and thus secure the election of ex-Governor Jacob D. Cox.

A Republican legislative caucus was convened on the evening of January 4th, to nominate a candidate. The first and informal ballot gave me 61 votes to 14 scattering and the second ballot 71 votes to 4 scattering. This settled the matter unless the few dissenting votes could combine with the solid Democratic vote upon some other candidate. It was soon found that this attempt would be abortive, as several Democrats, and especially those from Richland and Fairfield counties, would vote for me it the choice came between Cox and myself. Every effort was made by General Ashley and the few others who were opposed to my nomination to combine upon anyone who could defeat me. They offered their support to Governor Hayes, but this was promptly refused by him. The same effort was made with Governor Dennison, General Garfield and General Schenck, and failed.

The joint convention for the election of a Senator was held on the second Tuesday of January. It was an open meeting. The voting was soon over on roll call, and the result was as follows: Sherman 73; Morgan 64; Cox 1; Schenck 1; Perry 1. Thus I was elected by six majority over all. When this result was known five Democrats changed from Morgan to Cox, and others were preparing to do so when Lieutenant Governor Mueller announced the result of the vote. He was an educated German of high standing, but his English was very imperfect. His decision that I, having received a majority of the votes cast, was duly elected, was clearly right, and this was conceded, but his imperfect English created great noise and merriment. It was printed in the "Ohio Statesman," on the same day, as follows:

"John Sherman, having received seventy-three votes for President in Congress [laughter], I mean for Senator in Congress, which being a majority over all them others, I declares John Sherman duly elected Senator in Congress from Ohio."

If the changing of the minority vote had proceeded, some of the Democratic votes would have been cast for me, and my majority would have been increased, but I preferred the election as it occurred. My election for the third term was after a hot political contest, but it left no wounds unhealed. Most of the gentlemen opposed to me became afterwards my warm friends.

In July, 1872, two months after the close of the session of Congress, I received the following letter from Thomas A. Scott, President of the Texas and Pacific Railroad Company:

"Philadelphia, July 19, 1872. "Hon. John Sherman, Mansfield, Ohio.

"My Dear Sir:--A few gentlemen connected with the Texas and Pacific road, and myself, propose to go to the Pacific coast, leaving Philadelphia about the 12th to the 15th of August.

"If your engagements will permit, I shall be very glad indeed to have you go with us.

"I am going from San Francisco to San Diego, and shall return by way of San Francisco; the trip will occupy about thirty days.

"Please let me hear from you, and, if possible, let me have the pleasure of your company.

"Very truly yours, "Thomas A. Scott, President."

I accepted the invitation, and with a very agreeable party of ladies and gentlemen, among whom were Mr. W. T. Walters, of Baltimore, and his daughter, made my first voyage to the Pacific coast. Mr. Scott, as president of the Pennsylvania Railroad Company, had command, by courtesy, of every convenience of travel. We had a dining car which we could attach to any train, with ample room for beds, and a full supply of provisions. The journey to San Francisco was broken by several stops on the way at places that we thought interesting.

Great changes had occurred in the brief period since my trip in an ambulance with General Sherman. The Indians and buffaloes had disappeared from the plains, the former placed on reservations distant from the railroad, and the latter by gradual extinction. When we crossed the Laramie plains I was in, to me, a "terra incognita." The great basin of Salt Lake, with the varied and picturesque scenery to the east and west of it, attracted our attention, but the want of water, the dry air, the dust and the absence of tress and vegetation of any kind, condemn all that country to waste and desolation, except in a few places where irrigation can be had. The Nevada range of mountains was crossed at night, but we were to explore them on our return. When the broad valley of the Sacramento opened to our view, we could hardly express our delight. Here, indeed, was the land of gold, with its clear air, its grand mountains, its rich plains.

Aside from the wonderful variety of its scenery, the history of California has always excited poetic interest--its long settlement by mixed races living in quiet peaceful harmony, mainly as herdsmen and shepherds, suddenly disturbed and conquered without firing a gun, by an aggressive race who soon revolutionized the habits of the natives, and planted a new civilization, with all the bad as well as the good elements of our race. Then the discovery of gold, immediately following the conquest of California, drew to it, from all parts of the United States, the most restless and adventurous of our population, some of the worst and many of the best. The rapid admixture of these diverse elements threatened for a time hostile conflicts, in which criminals, under cover of law, committed murder and other crimes, and peaceful, law-abiding citizens were compelled to appeal to force and mob law to preserve civilization.

The railway soon brought us through Sacramento to San Francisco, where we remained several days. We were kindly received and entertained. The enterprise of Scott was not then favored in San Francisco, but this did not prevent our hearty welcome. Here I met Mr. Hollister, whom I had known in Ohio. He was the great shepherd of California. I was informed that he owned 100,000 sheep, divided into flocks of about 3,000 each. These flocks were wintered at a large ranch near the Pacific coast belonging to him. The climate was mild, and the sheep could live without shelter during the winter. The flocks would start eastwardly over the great valley, each flock cared for by a shepherd, a boy and a dog, feeding in the open country, some of the flocks reaching the Mariposa valley, one hundred miles away. When the grass failed they were turned to the west to their home. Whether this tale is an exaggeration I cannot say, but certain it is that at that time sheep raising and the production of wool was one of the chief industries of California. Hollister was also interested in woolen manufacture, especially of blankets, equal to any in the world. When I knew him in Ohio, he and his brother were the owners, by inheritance, of a large and valuable farm in Licking county. When gold was discovered in California, Hollister sold to his brother one-half of the farm, and with the proceeds purchased a large flock of the best Ohio sheep, and drove them to California, taking two years for the journey. He was fond of telling his adventures, and proud of his success. He died a few years since in California, but whether his good fortune followed him to the close of his life I do not know. He was very kind to our party and accompanied us to San Diego.

From San Francisco we made a trip to the Mariposa Grove, and the Yosemite valley. We traveled by rail to a small station nearest the grove. Then by stage we rode to the terminus of the line. From there we went but a short distance to the grove. This majestic survivor of the forest has been so often been described that details are not necessary. We measured the trees, and rode on horseback nearly one hundred feet through one of the fallen monsters. We also attempted to form a ring with hands and arms extended around one of these trees, but our party was not numerous enough to encircle it. I felt a sense of insignificance when I realized the long life of some of these trees, estimated to span forty generations of men, and still in health and strength. We returned to the stage station and again mounted our horses and mules for the perilous adventure of a descent into the Yosemite valley. It so happened that Mr. Bell, the keeper of the station, was a former resident of Bellville, in Richland county, Ohio, in which I live. He knew me well, and his wife I knew as the daughter of a leading farmer of that county. I thought I might utilize this acquaintance by asking him to see that I was well mounted to descend to the valley. Much to my surprise a spirited horse, well accoutered, was brought out for Colonel Scott, and a shaggy short-legged mule, with a California saddle and a common but stout bridle, was brought out for me. I felt that Bell had disregarded the obligation of "auld acquaintance," but said nothing.

My mount started at the heels of the cavalcade in a steady walk, but I noticed he was sure-footed, and that, at the end of two or three weary hours, he had passed most of the party and soon after was close in the wake of Colonel Scott. In the meantime, I had noticed that I was the subject of merriment. My feet were in close proximity to the ground. The length of my legs was out of proportion to that of the legs of the mule. When we came to descend the mountain, however, at an angle of nearly forty-five degrees, on a very narrow path, I found that my mule could turn the bends of the track, and, by a peculiar gathering of his feet, could slide down difficult places, while Colonel Scott, on his already jaded horse, was troubled and worried. He dismounted when the path widened and asked me to go ahead. He then followed me, leading his horse. After that, I made up my mind that my Richland county friend had not failed me in my hour of need.

As for the scenery through which we were passing, no language could describe it. We saw, four thousand feet below, a beautiful little valley about half a mile wide at the widest part, with what appeared to be a very small stream dancing along from side to side of the valley, and surrounded by precipitous mountains in every direction. The eye and mind can now vividly recall the picture of the scenes than around me. My mule had my confidence, but I feared lest some fatal mishap might befall some of my companions, and especially I feared for a lady who ventured the journey, but she fortunately displayed pluck and coolness, and at the end of the day we all arrived at the hut in the valley safe and sound, but very weary. Since that time, I understand that a good road has been made up the valley, by which tourists can enjoy the grandest scenery in nature, without the risk we took.

We enjoyed a hearty supper of plain food, and a sound sleep on corn- husk mattresses. The next day we explored the valley, and enjoyed the changing views of near and distant mountains. These have often been described, but they can only be appreciated by a personal visit. We left the valley by another route to the north, and reached the railroad by a different line of stages.

Returning to San Francisco, we took the boat for San Diego, stopping, on the way, at Santa Barbara and San Pedro. From this place we drove to Los Angeles, then a typical Mexican town of great interest. The good people hoped for the railroad, but Colonel Scott expected the road of which he was president would be able to reach San Diego.

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