---[ in 1887,
Albert Michelson and Edward Morley will carry out a simple experiment that will show there is æther and non-moving Earth

in 1888 George Eastman will release for sale the first consumer camera "Kodak"]

to enable national banking associations to extend their corporate existence

Be it enacted by the Senate and House of Representatives of the United States in Congress assembled:  That any national banking association organized under the acts of February 25, 1883, June 4, 1884, and February 14, 1880, or under sections 5133, 5134, 5135, 5138 and 5154 of the Revised Statutes of the United States, may, at any time within the two years next previous to the date of the expiration of its corporate existence under present law, and with the approval of the Comptroller of the Currency, to be granted as hereinafter provided, extend its period of succession by amending its articles of association, for a term of not more than twenty years

Mr. Burrows, of Missouri [Joseph Henry Burrows (May 15, 1840 -- April 28, 1914) greenback national; ordained minister; until very recently, he was member of the Republican party and supporter of republican policies.].  Mr. Speaker, if Congress had one single mind and if its opinions could be uttered through the medium of one tongue, I would like to listen to the answer which this Congress would give to the questions which are suggested by the bill under consideration.  This bill (H.R. No. 4167) is the result of a complex process of gestation in the Committee on Banking and Currency, and bears the title of "a bill to enable national banking associations to extend their corporate existence."  As such it is a matter of serious import to the people I represent, as well as to the people of the United States at large;  and I propose, Mr. Speaker, to discuss briefly, in a somewhat Socratic method, some of the salient features of this bill.  The antithesis of the measure before us is the cornerstone of the National party, which I have the honor to represent in part on this floor.

The measure before us is the rock of offense of both the old parties of the country against the welfare and wishes of the people.  Were I to include, as I very properly might, upward of sixty Democrats and nearly a score of Republicans, with the little group of Nationals on this floor who owe their selection as Representatives here to their antagonism to the purposes of this bill, I might claim that no one measure, not even the tariff, had so vital a hold upon public sentiment, had so much to do with the character of this House and has so much to do with the character of the next two Congresses that are to meet here, as the measure which is being driven through this body with unbecoming and inconsiderate haste at the bidding of the favored few, the privileged class, the potent plutocrats, the commercial cliques, and the corporate cabals who demand the passage of this bill in their interests, with as little discussion as possible, and with all the speed that the fear of an awakened and growing public sentiment can urge to the flying feet of the financial pirates who are getting to their castle with the plunder of twenty years upon their backs, and seeking to have Congress bar the door against their pursuers by slipping the bolt of this bill as a law to guard their treasure for twenty years to come.

What, Mr. Speaker, I ask, is the reason for this bill ?  Speaking for the people generally who do not own banking franchises, and for the people of my own State and district in particular, I ask this Congress, What do you mean to do by passing this bill ?  Who ask for its passage ?  What interests are to be conserved ?  What evils are to be averted ?  What errors are to be corrected ?  And what benefits are to result, and to whom are the benefits to accrue from the passage of this bill ?  The bill proposes to extend the existence of a class of corporations that exist not for the purpose of producing anything, not for agricultural, manufacturing, educational, charitable, or even strictly commercial business purposes.

A class of corporations that add not a dime to the wealth or intelligence of the people;  a class of corporations that in the present state of civilization do not contribute to society as much as a traveling circus that amuses the multitude, nor add to the security of our finances half as much as a modern iron safe that scarcely demands even the tithing of a patent royalty for a service that is actually greater than that of the associations known as incorporated banks throughout the whole Union;  such a class of corporations are here demanding the sanction of Congress for a further lease of power for twenty years --to do what ?  Why, they propose to furnish the people with a paper currency that is as much superior to the old State bank currency as that was superior to the cowry of the African coast, says the representative of these banks.

I admit it;  but I ask what of it ?  As the lawyers say, I demur to this statement.  I wish to know why these corporations should be chartered to do that for the people which they can do so much better for themselves ?

I would like some of the many gentlemen on this floor who are either the officers, directors, or stockholders of some of these national banks, and who will vote on this measure in which they have a direct pecuniary interest, or I would ask even those more judicial members, who favor this bill without a direct pecuniary interest, if they can give me one reason, just one good and valid reason, why they ask for the existence of a chartered monopoly or class to be created or perpetuated between the people and their Government that shall have delegated to it the sovereign power of issuing that which passes current as money in this country when the Government itself issues a paper currency as much superior to the notes or current debts of these national banks as their notes, when indorsed by the Government, are superior to the old State-bank notes ?

Nobody wants, nobody argues for, no one dreams of a return to the old system of paper currency that existed prior to the rebellion.  There has not been heard in this Congress, nor for years before it, the voice of a solitary member on this floor advocating a return to the old State-bank system of currency;  and when I see, as I constantly do, that gentlemen in the advocacy of this bill are constantly throwing up the false cry of "State banks or national banks," and asking us if we who oppose the national banking system would be willing to return to the old State-bank currency, I am compelled to declare that these gentlemen not only misrepresent the national party, but are raising a false issue to divert attention from the real issue now before the people.

The issue is not between the old State banking system and the present national banking law, any more than there is an issue between the old wooden plow of a century ago and the steam gang-plow of steel to-day, or between the dug-out boat of the savage and the steel steamer of our day.  Men are not so conservative as to forever cling to that which has been supplanted by a better thing.

We no longer insist on wampum and coon-skin currency, although we know that at a time in our history they were the best and most acceptable in general use.  So, too, we have relegated to the lumber-room and museum of the past the old State-bank money of 1860, and we who oppose national-bank currency have no more intention of using it again than the cotton factories or fabric-makers of to-day have of abandoning the inventions of Arkwright and Jacquard for the old spinning-wheels of our grandmothers in the forgotten attics of our older homesteads.

Where, then, Mr. Speaker, is the issue ?  Clearly not between the best and the worst, but between the better and the best;  not between the effete and the useful, but between the useful and the improved or more useful.  Steam no longer competes with horse-power, its supremacy being conceded;  but electricity is beginning to dispute many fields with Steam.  So, too, the Treasury note is competing with the national-bank note for recognition in law of the supremacy that is already conceded to it by popular estimation.

The issue is between the United States and the favorite class of bankers for whom the Government has been indorsing for twenty years.  The people propose to go into the business for themselves, instead of indorsing for an ungrateful and greedy class, who demand and receive pay from the indorser, upon whose credit they thrive.

The constitutional prohibition against any of the States making anything but gold and silver a legal tender is accepted in good faith by the party most earnestly opposing national-bank currency, and with it we accept in the same spirit the fact that the Constitution has made the General or Federal Government the sole power to issue or coin lawful money of the United States, whether of metal or of paper.  The power to coin or make money having been delegated by the States to the Federal Government is exclusively vested in the General Government;  and as if to emphasize the perpetual or irrevocable nature of this grant of supreme power by which the States, for the common welfare and convenience of all, divested themselves of those parts of their sovereignty which they conferred upon the Federal authority to create the nation, the tenth amendment to the original Constitution declares that "all powers not herein granted are reserved to the States or to the people thereof."

Like the powers to levy taxes, duties, and imposts, the powers to declare war, to make treaties, to maintain an army and navy, to establish post-offices and post-roads, the power of making, coining, or issuing the money of a nation is one of its most important sovereign attributes.  These are powers that every nation guards with zeal, and which none allow to be infringed upon with impunity.  Why, therefore, should we create, countenance, or continue a favored class of citizens, or of artificial persons known as corporations, to whom we unlawfully and unconstitutionally delegate one of the sovereign attributes and functions of the Government ?

What excuse have we for giving to corporations the power to issue money or currency any more than to create another class of corporations, like the great manufacturing companies, to levy the tariff, or a part of it;  or to still other corporations, like the railway and express companies, to establish post-offices and post-roads;  or to give to combinations of merchants duly incorporated the power to make treaties;  or to lawyers the power to declare war, or confer upon the Grange organizations the function of regulating taxation or the issue of patents ?

There is not a whit more reason or excuse for the one than for the other of these methods;  and since the preposterous character of an entire government by corporation, worse than the old guilds of London, is apparent to every one, and since we have by indirection and maneuver already far too much of government by corporations, it becomes every man in this House and in this land to see to it that he take his stand on the solid ground of popular rights and of constitutional government in this issue as against class privileges and the incongruous government by corporations that the present anomalous financial laws of this country now exhibit.

That portion of our currency that consists of coin, even to the paltry copper and the almost intrinsically worthless three-cent nickel coin, is so jealously regarded as the sole issue of the rightful authority of the General Government that the severest penalties are visited upon all persons or corporations who issue tokens, coins, or currency in imitation of these issues.  Why should not the Government guard with still greater jealousy its exclusive right to issue the paper money of the land ?  Why not treat as counterfeiters all banks of issue that purport to issue any money other than "lawful money of the United States," or the standard coins of its mints ?  Surely the plea of convenience cannot be raised, for the Government prints and furnishes all the national-bank notes as well as the Treasury notes, and can therefore furnish enough.  Besides, the plea of convenience would not avail the counterfeiter, or even the miner or assayer of bullion, were they to issue coin of equal or greater fineness and value than that of the authorized mints of the Government;  and the penalty of a violated law would be inflicted on those who had usurped this attribute and function of Federal sovereignty, even though no injury had actually resulted.

But the gentlemen who urge the passage of this bill tell us that banks are a necessity of our civilization and of our commerce.  I admit it, but I most emphatically deny that it is a necessity of commerce or of civilization that the debts or notes of these banks should be authorized to circulate as currency, and to take the place of real money of the Government, especially under the conditions that now exist to favor these institutions.  Banks of exchange, discount, and deposit we must have at present, but banks of issue should be suppressed as counterfeiters in the interest of commerce, justice, and labor's rights to uniform standards which shall not be made to fluctuate according to the caprice or greed of the capitalist classes who control banking corporations.

But, again say these gentlemen, if you admit the convenience and usefulness of banks of discount, exchange, and deposit, you must know that without the power to issue money or emit bills of credit or circulate their notes as current funds these banks could not or would not exist.  This proposition I utterly deny, and it is so far from true that I have only to cite the fact that in the State of New York alone there is an increasing number of State banks that now reaches nearly one hundred and fifty that do a profitable banking business without issuing a dollar of currency or notes of their own to pass for money.  In fact not one-third of the banks and banking institutions of this country are banks of issue.  Comptroller Knox, the special advocate of these national banks, shows, on page 25 of his report for December, 1880, that there were then 6,532 banks and banking houses and institutions in the United States, of which but 2,076, or not one-third, were national banks;  that while the banks that do a legitimate business and issue no currency had deposits to the extent of $1,319,009,000, the national banks held, through the partiality of Government deposits, &c., only about $430,000,000 less than the other banks.

These figures at least offered us ample ground for denying the claim of the national-bank advocates on this floor and elsewhere, that the unconstitutional and dangerous function of issuing as currency the notes of these banks is essential to existence or prosperity of legitimate banking in this country, and for declaring that it is a claim that is as devoid of merit as it is false in fact and vicious in policy.  Besides this, let me cite a few figures to show that our banking system does not need the royalty and profitable business of issuing money to sustain it in affluence and security such as the most conservative man, if a patriot, would take no alarm at.  The annual report of the Secretary of the Treasury on the state of the finances for 1881, over the signature of Secretary Folger, shows that upon a capital of $463,821,985, and with an aggregate circulation of $300,344,250, the national banks then in existence, numbering 2,132, managed to have outstanding loans amounting to $1,169,022,303.  That is to say, they managed to get more than $3 due to them for every dollar of circulation they had by loaning the currency over and over again, and thus making $1 do the work that $3.50 should have done in the commercial and business transactions of the country.  This they did by "loans and discounts," the profits of which depend largely and mainly upon the scarcity of current funds.  The scarcity of current funds, under existing law, depends or is made to depend so largely upon the caprice of the banker that the power to retire or to inflate the volume of currency, which is at all times in the hands of the non-producing class, represented by the Bankers' Association, that is forever seeking to get out of the producers the largest possible share of the fruits of labor, has become a daily danger to all classes of producers.

The present bill does not propose to remedy this evil in any manner or to any extent, and the people are to be left to the tender mercies of the cunning old spiders who spin the nets to entangle the honey-laden bees of labor through the devices of bank currency, bank discounts, and bank "shaves."

It is true that some of the gentlemen on this floor, having rather more of both intelligence and of conscience in this regard than their more thoughtless and more avaricious fellows, have been put to the blush of shame so often by having this power of shortening or lengthening the currency possessed by the banks constantly complained of, that they have been known to favor and to advocate some limitation or restriction upon the banks in this regard;  but I warn gentlemen who may be appealed to for votes to pass this bill upon the ground that any such modification may be ingrafted upon it as an amendment, or that any such provision would accomplish one iota of gain for the people, that just so long as the banks have the power of issuing currency the danger inheres in them, notwithstanding you forbid them to increase or diminish their currency save upon a notice of three, six, or twelve months.  Should Congress seek to insist on this restriction and still give the banks the power to issue money there would arise a new system of subsidiary and ephemeral banks, constantly organizing and going out of existence, merely to avoid the hampering of this proposed restriction and to play into the hands of the great banks the game of circumventing the popular will.  Nor will it do for us to sugar-coat this dose of poison by any other amendments that do not cut off the head of the organized swindle of the whole national banking system by striking out the enacting clause of the bill before us.

The distinguished gentleman from New York, [Mr. Flower,] who seeks to throw a tub to the whale of popular indignation over the threatened passage of this bill by allowing the banks to be sued in the State courts and by compelling them to give three months' notice in retiring currency, must be fully aware of the worthlessness of rude palliatives in curing the evils of the national banking system.  How, for instance, could he explain to the people of the Empire State in his projected gubernatorial campaign that the three months' notice amendment was of any real value, when the intelligent people of that State, as of the whole Union, are fully aware that the Bankers' Association, which meets at Saratoga every year, acts as one man, and can agree to give the required notice just in time to shorten up ready funds when the autumn crops need gathering or moving, or just in time to catch the spring opening of business and exact the big shaves on currency that are regulated by the morality and avarice of the bankers and all other monopolists, whose limit of extortion is avowed by them to be "all that the traffic will bear?"

Certainly the gentleman from New York does not believe that the people, who generally have no money to waste in lawsuits against rich and unscrupulous corporations, would be pacified in their indignation against a perpetuity of the national-bank swindle by the convenience of the boon he would accord them of prosecuting in the State courts their cases against these banks.  Nor will the proposition of the gentleman from North Carolina, [Mr. Scales] which would vouchsafe to the dear people the privilege (?) of pledging their lands to the national banks, so far neutralize the poison that lurks in this cup now held to the lips of Congress by the Bankers' Association, who demand that we swallow this bill, as to make it either a pleasing or a safe dose.  Neither do I see safety or reason in the proposed amendment of my colleague, [Mr. Buckner,] which would require the national banks to keep their reserves in gold and silver.  This proposition, coming from a distinguished Democrat, proves how heartily united the two old parties are in the interest of hard money, tightly locked up from circulation, and hard times tightly bound to the chariot-wheels of the capitalist class by the bond of oppressive class legislation.

The very thing for which many of our Democratic brethren, in common with the Nationals, denounced Senator Sherman when Secretary of the Treasury, the lock-up plan, which asked Congress to appropriate $100,000 to build a new vault to hold the overflow of coin from the glutted Treasury of a nation that owned over a thousand millions of dollars, is now proposed as a Democratic panacea for the rechartered banks.  Verily, when this Shermanizing policy is added to the national-bank system, I hardly think the offensive carcass of this public cancer will smell one whit sweeter to the offended public nostrils.  But the proposition of the gentleman that these banks shall issue no currency of a less denomination than $10 is merely good in so far as it cuts off the power to issue other smaller notes, but it is bad inasmuch as it does not altogether cut off the power of these banks from issuing currency.

My other colleague and fellow National [Mr. Haseltine] has offered an amendment, which, like that of the gentleman from Pennsylvania, [Mr. Brumm,] strikes at the root of the evil, and takes away at once the foundation and the necessity for these national banks.

The appropriation of the hundred or two hundred millions of dollars that lie in worse than idleness in the national Treasury from year to year toward the payment of the national debt is both in accord with honesty and a wise public policy;  and the proposition of my distinguished colleague to issue non-interest-bearing Treasury notes to pay off the remainder of the bonded debt that may be due or optional is both just and statesmanlike, and would prove a greater blessing to our land than all the legislation of this Congress or the labors of those of the past twenty years have been able to achieve.  No rational argument can be made against its lawful or its equitable character.  If the credit of the nation be good in the bond it issues, surely it is better in the currency it would substitute for those bonds, as the substitute would be free from the burden of interest, and might be made taxable.

If the credit of the nation be good only because its Treasury holds coin, then the power of the Government over taxation, titles, property, life, and liberty, are but metaphysical myths to the minds of those who worship only at the glittering altars of mammon;  and the government that pays out coin is committing financial suicide.  Away with such rubbish !  Prate of wisdom to the brutes if the end of government be held to be the hoarding up of treasure !  While no man of you who favor this absurdity of a few grains of gold being the only standard of labor's reward, and of hoarded stores of gold in the national Treasury being necessary for any purpose beyond current expenses, dare carry out your financial logic to the absurd end to which it clearly leads, not one of you can successfully deny that the result of your policy is precisely that which I have indicated.

No, Mr. Speaker and gentlemen of this Congress, it will not do to attempt to gild this legal crime by trifling amendments.  It will not turn away the growing wrath of the injured public for you to curb this financial monster by gentle stays or small fences in its onward path toward unbridled supremacy in national politics and legislation.  You must kill it or it will kill you !  You must put the untaxed, privileged class of bondholders, who are already insisting that we are paying off the debt too fast and taking away their bonds and privileges, upon the level with other citizens.  Already the banks are talking of their "vested rights," and as the gentleman from New York [Mr. Flower] assures us in his remarks, they do not need this bill to enable them to continue their existence, but merely to facilitate the continuation of their existence.

If they possess the power to recharter themselves, or if they have a quiet understanding with the Comptroller of the Currency that they can be renewed or rechartered by going out of business and commencing again for twenty years just before their charters expire, then why do these corporations deign to ask any action on the part of Congress at all ?  Such is their position, in fact, and they gloss over their impudence by formally procuring the sanction of Congress to this bill --just to cover contingencies-- in order to avert an outburst of public wrath.  I implore Congress and the people to wake up and throttle this monopoly, or the Government of the people will become the slave of the money-power.

The only safety is to cut off wholly the power to issue money which these banks possess;  and upon that I stand, whether the present iniquitous special privileges of the national banks be retained or cut off.  But, say these gentlemen, the banks need the currency privilege to sustain themselves.  In denying it I have shown that they reap profits from each dollar equal to the ordinary profits by loans and discounts on $3.50;  but this by no means exhibits the full amount of the profits of these banks.  Out of 2,298 banks existing September 1, 1880, the profits of 2,072 of them above all losses for the six months previous to that date is shown, on page 48 of the annual report of the Comptroller of the Currency, dated December 8, 1880, to be $24,033,250, and for the year prior to that date, $45,186,034.  On page 45 of the same report the losses of 1,360 of these banks is shown for the same periods as respectively $7,142,519.96, and $14,706,406, which very largely increases the percentage of profits on their business in order to leave as net gains over $45,000,000 as the result of a year's work.

The Comptroller of the Currency tells us that the national banks have lost in five years, from 1876 to 1880, inclusive, the sum of $100,551,475.45 in their business transactions, and yet he shows that in the same period they have declared dividends to the tune of $199,592,902, and in addition thereto have accumulated a surplus reserve fund of upward of $130,000,000, which they now hold as the "balance of power" in this gigantic struggle between these corporations and the people.  Now, in speaking of this surplus fund we touch the most sensitive part of this vast cancer on the body-politic, and find the nucleus of the organized power of these favored classes by which they are here as a unit clamoring for the practically indefinite extension of their lucrative privileges, which this bill secures if passed.

Comptroller Knox, in his special plea for these banks, called his annual report, dated December 6, 1880, page 47, says that---

The law provides that a surplus fund shall be accumulated by setting aside before the usual semi-annual dividend is declared one tenth part of the semi-annual net profits of the bank.

And he adds:

In some cases this legal surplus now exceeds the capital of the bank.

To remember that this vast accumulated surplus of over $130,000,000 is but one-tenth of the net profits of the banks above the regular large semi-annual dividends, and that the banks held at the date of the Comptroller's report the additional item of $46,139,690 of "other undivided profits" and $3,452,504 of "unpaid dividends," we are confronted in the midst of this legislation by the visible power of an accumulation of $180,000,000 held by less than 2,200 corporations as a club over the heads of the people and Congress to beat down opposition to the scheme they have concocted for securing to themselves indefinitely the perpetuity of their still more valuable charters and privileges.

I do not speak carelessly when I say that this vast accumulation in a few hands is held as a club to drive or coax legislation, nor do I mean to be understood that such vast sums are used or are intended to be used to bribe or corrupt legislators;  but I do mean that we have heard it distinctly stated by members of this House, by bankers, and by the subservient and subsidized press of the great cities that a failure to recharter these banks would precipitate a financial revolution through the compulsory distribution to the stockholders in these banks of the vast sums thus kept out of use in ordinary business, and that such a jolt or shock to the status quo of financial circles would demoralize capital, unsettle business, and divest the favored few of much of the mighty power they now possess over the many.

Fools and socialists, timid speculators, and conservatives destitute of foresight may, with the rich oppressors of labor and parasites of production, whose swollen coffers would, if justice were done, render up to the rightful owners this fund, befrightened at such an act of justice;  but the unlocking of these vast sums would place in more numerous hands the funds to promote general business in other channels than the shaving of paper, the loaning of bank credits, and the "bearing" of the money market by vast lock-ups of the currency of the country.

In the interests of business, and in the desire to protect popular rights, agricultural labor, and mechanical industries from the dangerous power of this gigantic banking octopus that holds, in addition to its vast and valuable chartered powers, Government favors, and associated advantages, this vast sum of nearly $200,000,000 of extra, reserve, unexpended, or undivided profits as the result of a few years of money monopoly, (during which they have paid right royal dividends besides,) I demand that the power of this unproductive system be trampled out of existence by the will of every patriot who hopes to leave to his children at least a chance to prosper in the race of life without becoming forever a slave in the treadmill of bank-credit and bank-currency combinations against labor and productive enterprise.

If gentlemen in this House are to-day afraid of the consequences of distributing to its individual owners the present surplus held by these national banks, with what abject slavish submission would they not contemplate the increasing accumulation of this fund through the years and decades that are to follow an extension of their bank charters ?  If the vaunted statesmen and pseudo-statesmen of to-day stand aghast or tremble in awe before the threatened jolt or jar or disturbance in business which these banks threaten if their demands are not met by this Congress, how clearly must it appear to the man who sees the future or who comprehends the present that we are already bound in the chains of a banking oligarchy and moneyed aristocracy that simply regard the people, the toiling, producing masses, as their legalized prey, and who resent all efforts of a few brave men in Congress to rescue this fair land from the harpies who, under the guise of most benevolent bankers and capitalists, are enabled through the iniquitous laws which this bill would perpetuate to reap all the richest results of the labors of every class of citizens without even claiming to render an equivalent to society for these advantages.

It has not been my purpose, Mr. Speaker, in these remarks to reiterate the familiar evils and oft-cited absurdities of our present banking law, which allows these banks to issue as currency that which is not in law or in fact lawful money, which compels the Government of the United States to pay a few rich men, as soon as they apply for and receive a bank charter, interest on bonds that have been practically redeemed, and royalties to corporations whose notes they indorse, which enables the associated money-kings of the country to form a plutocracy that defies the popular desire to restore to the Government the power of controlling the volume and character of the currency.

I have not attempted to amuse, nor to recite bombastic platitudes to array rich against poor, or labor against its creature and natural servant, capital;  but in entering my solemn protest against the continuance of this wicked financial system of our present national banks, that has grown so fat, impudent, and domineering as to threaten the people who would curb its power after the first twenty years of its existence, I have sought to show to the country and to the legal minds of this House that the present system should not be extended or perpetuated, because---

Every man, Mr. Speaker, who sees, as all may see who will look, that with our ever-increasing aggregation of great wealth in our great cities there is an ever-increasing amount of want and crime, of scarcity and hardship among the workers, an increase of underpaid and discouraged farmers and a vast increase in the tendency of our young men to shirk work for the fields of the gamblers, money-changers, and other parasitic classes that are so influential in this country at present;  all, I say, who see these things must feel that unless we do something to prevent this centripetal aggregation of wealth;  something to restrain the present tendency to disinherit the many and to give all to the few;  something to soften or mitigate the sharpness of the contrast that is forever rising higher and higher between the two chief products of the Democratic-Republican financial policy of to-day, namely, millionaires and paupers;  unless we do some of these things there is and will be dangers to our institutions, to our families, and to our very lives, which will surely come in the same or worse forms, as it will come from the same causes in more modern form, as the terror of the French Revolution of 1789.

Industry will not be forever wronged, robbed, injured merely to gratify the greed of the moneyed class.  Agriculture will not be forever the bond-maid of banking and railway rings.  Manufacture and invention will not remain indefinitely and unquestioningly the serfs and beggars of the money lenders, who hold them under this financial system at the mercy of the ignorance, cupidity, or timidity of those who control capital.

Mr. Speaker, you know these things are true.  The very gentlemen who ask us to pass this bill know these things are true.  Gentlemen who profess to be anti-monopolists, who can see the evils of railway monopoly, of gas monopoly, of water monopoly, of shipping or manufacturing monopolies, shut their eyes at the command of the banker who exacts tribute from them under guise of doing them the favor to shave their notes or discount their paper credit, and obediently refuse to see the size or iniquitous character of the master monopoly of them all, the parent monopoly of all the rest, that of the money or currency monopoly of these national banks.

It is against this monster monopoly that the people are fighting.  It is to resist its further encroachments that they have organized, stood by, and are extending the power of the National party which I have the honor in part to represent here.  Knowing these things as you do, knowing that the substitution of Treasury notes for the present volume of national-bank notes would be hailed as a boon by all the farmers, workers, and producing classes of this land, both because it would give us a better currency of real money and because it would be a saving of many millions of dollars annually to the whole people;  knowing that the votes you give here on this measure, the record you will make on this bill, cannot be obliterated by excuses to your outraged, awakened, and indignant constituents when they shall find themselves bound, gagged, and sold to the money-changers by your act in the passage of this bill --I ask you, in the name of justice, in the name of the American people, and of our country's best interests---

How dare you pass this bill ?  When its indefensible provisions, its ridiculous subserviency to the power of the "reserve fund" and the "other undivided profits" are exposed before your constituents, as they surely will be;  when the appeal is taken from your action here to the people whom you by this bill propose to keep enslaved to the money-kings;  when the faithful Greenbackers go to the hustings to expose to the people the full extent of this crime against their rights and best interests, as we surely will do;  when, finally, want, oppression, monopoly, and enlightened public opinion combine to bring to justice or to scourge with stripes the men who chose to obey the money-kings rather than the people, you who vote for this bill will be praying for the mountains to fall on you and the waves of a political oblivion to hide you forever.  Upon no ground can the passage of this bill be defended with success.  For no valid reason can a vote be asked for it.

It is one of the most wicked, defenseless, inexcusable, flagrant cases of a popular swindle that ever came before Congress, not excepting the land-grant, Credit Mobilier, granite contract, river and harbor, whisky bill, or other swindles that have disgraced the Congressional legislation of the past or threaten it at the present moment.  Here and now gentlemen must make their record and choose their fate.  They know whether they will serve the people who are opposed to this bill and to the national banking system, or whether they will obey the commands of the Shylock Radicals and Bourbon Democrats who conspire to pass this measure.  The crisis has come, and the old dodge of Bourbons and Radicals talking against the national-bank swindle in their districts to get votes and voting with the political harlots who think they conceal their acts from their distant constituents can be played no longer with any hope of success.

In conclusion, I ask, in all candor and seriousness, why should we, how can we, and how dare we pass such a bill as this ?  Let the bank charters expire.  Banking will not cease.  Over two-thirds of the banks and banking of the country is already done without these bank charters.  Let the charters expire, and put all the banks on a level.  Let the charters expire, and put the Government again in sole and exclusive possession of its rights.  Let the charters expire, and put the vast revenue accumulations in the bank-vaults into trade, commerce, business, and productive enterprises.  Let the charters expire, and behold "the best banking system the world ever saw" thereby superseded by the best currency and most equitable financial system that man has ever devised.  Let the charters expire, and forbid with the spirit of Andrew Jackson the rechartering of banks by the Government or by any authority which shall claim the right to empower them to issue currency !  Let the charters expire, and the end of monopoly will be in full view !  Let the charters expire, and let the people live freed from the national-bank incubus that now assumes to be their master.

Could we have a financial Peter the Hermit to thunder over the land his anathemas, and to preach a new crusade against these banks, his cry at this moment would be:  The national banks must go !  Let the charters expire !

Mr. Ermentrout.
I have agreed to give the remainder of my time to my friend from Texas, [Mr. Culbebson.]  The butt-end of the argument appears to be on the side of the bill, and I therefore do not think it more than fair that those gentlemen who entertain views opposed to the measure should have a fair hearing, and I therefore yield to the gentleman from Texas.

The Speaker pro tempore.  The gentleman from Pennsylvania [Mr. Ermentrout] yields the remainder of his time, which is fifteen minutes, to the gentleman from Texas, [Mr. Culberson]  Does the gentleman from Texas desire to occupy also the time he is entitled to in his own right ?

Mr. Culberson.  Yes, sir.

The Speaker pro tempore.  The gentleman from Texas then is recognized for thirty-five minutes.

Mr. Culberson.  [David Browning Culberson (September 29, 1830 -- May 7, 1900) D, Texas; Confederate soldier; studied law, admitted to the bar]
Mr. Speaker, I would not trespass upon the indulgence of the House by participating in this debate, but for the fact that I feel it incumbent upon me to support and defend the amendment which I have submitted to the bill now under consideration.  The bill substantially reenacts the national bank act of 1864.  The banks now in existence, numbering 2,148, are authorized to reorganize at the expiration of their charters for an additional period of twenty years, and full authority is given for the organization of new banks with like period of duration.  By reference to a the amendment which I have submitted will be observed that it propose to put the present national banking system into a process of gradual destruction, as it provides that after the passage of the act no franchise or charter shall be granted or extended to any association for the purpose of banking and that no banking association now in existence shall be revived or reorganized.

The amendment further provides that, as each bank now chartered shall expire by limitation or by voluntary surrender of its circulation, the Secretary of the Treasury shall prepare Treasury notes, in the usual form, of like denominations and of like amounts of the notes of such bank, and shall pay them out to the creditors of the Government, who may elect to receive them at par in payment and satisfaction of their claims.  The notes which are provided for are to be pure and simple "Treasury notes," receivable by the Government for all dues whatsoever.  I do not propose, Mr. Speaker, to repeal the bank act, as since the adoption of the Revised Statutes it is doubtful whether Congress has authority to terminate the charter of a bank lawfully pursuing its avocation and business within the terms of its charter, therefore I propose to leave the law as it is, to cover the operations of all existing banks and control their conduct until they shall expire by limitation.

I do not think, Mr. Speaker, that a more just and proper method to close up and discontinue the present system of banking could be suggested.  By it all individual or vested rights are recognized and protected and the business interests of the country sedulously guarded and shielded from any harm or disturbance whatever by reason of a reduction in the volume of currency.  No stockholder in a bank can justly complain of any violence or injustice to any right acquired by his investment, as the measure which I advocate permits each association to pursue its business unmolested for the full period of time fixed by its charter.  In respect to the public aspect of the subject I submit that no possible detriment or disturbance of the business of the country will follow the adoption of my amendment.  Because every banknote which may be canceled under the operation of it will be substituted by a Treasury note having all the attributes and functions of money which appertain to bank-notes.  There will be no reduction of the volume of the currency.  As the bank notes will pass out of circulation Treasury notes will pass into circulation readily, and will perform all the offices of money which national-bank notes now perform.

Bank notes are equivalent in value to coin, not because of the intrinsic merit of the bank which puts them into circulation, but for the reason that their ultimate payment and redemption are guaranteed the Government.  A Treasury note with like guarantee will not be less esteemed as a circulating medium.  I do not intend by anything have said or may say in this debate to assent to the proposition that Congress has authority to create a bank and invest it with the power to issue notes designed to circulate as, and clothed with the functions of, money.  The currency of this country is its life, and the framers of the Constitution wisely vested the law-making power with authority to coin money, prescribe its volume, and regulate its value.  National banks exercise governmental functions in respect to the currency.  Instead of the law-making power issuing the entire currency of the country it has relegated to banking associations the authority to issue it without limit.  They are invested with full power to dwarf or inflate the volume of currency at their pleasure.  There is now absolutely no restraint or limitation upon the power of the banks to decrease or increase the volume of currency.

I believe, Mr. Speaker, that the act in this respect is in conflict with the Constitution.  But it was passed twenty years ago.  Private rights and vast business interests, both public and private, have been acquired and grown up under this system of banking, and the practical question is, how best to discontinue the system without injustice to individuals, without wrong to vested rights, and without serious derangement of the interests of the public.  I submit that my amendment is a full and complete answer to the question.  I believe, Mr. Speaker, that a large majority of the people of the United States are in favor of the discontinuance of the national banking system.  They are prepared to see it pass away as speedily as practicable;  not because the continuance of the system implies a perpetuation of the national debt, as is alleged by some, for such result would not necessarily follow.  There are bonds enough already issued and which do not mature until 1907 to support the system upon a far more extensive scale than now exists.  There are to my mind graver and stronger reasons why the system should be abolished.

It has outlive the object and purpose of its establishment, and there is no necessity of a public character for its longer continuance.  If, Mr. Speaker, the advantages and benefits of the system out-weighed its injustice and disadvantages to the public, or if they were equal, we might be pardoned for giving new life to the banks and extending their succession for twenty years, as proposed by the bill.  But if, on the other hand, there are no benefits or advantages derived by the people from this system, and if it can be shown, as I believe it can, that it is a vast monopoly and opposed to the best interests of the people, how are we to escape the just indignation of those whom we represent if we fail now and here to put an end to its existence ?

What was the object and purpose of the act which authorized national banking ?  It was passed in 1863.  The Government of the United States at that time was engaged in war.  It was struggling to maintain its credit and to provide means necessary to prosecute the war.  It became necessary for the Government to utilize all its resources and exercise all its powers, doubtful and unquestioned, to maintain its credit and provide the means to support its armies in the field.

It was believed by those who conducted the affairs of the Government at that time that the system of banking authorized by the act of 1863 would aid the Government to sell its bonds, and also aid in maintaining the credit of the currency.  The history of that eventful period and the debates in Congress show that the national banking system would never have been instituted or authorized but for such prevailing sentiment and belief.  Therefore, to state the case as strongly as it should be stated, this banking system was adopted, first, to induce the purchase of the bonds of the Government, and thereby enhance the credit of the Government, and second, to maintain and enhance the value of the legal-tender greenbacks, in which bank notes were made redeemable.  I am not here, Mr. Speaker, to question either the motives or the soundness of the judgment of those who inaugurated this system and fastened it, I fear for all time, upon the country.

I believe that the motives which inspired the President and his Secretary of the Treasury, Mr. Chase, to approve the plan were pure and laudable but subsequent events have demonstrated that patriotism has exerted but little influence over the management of these institutions.  The Government was vastly deceived when it set up these fiscal agencies, so called, to enhance the value of its bonds and the credit and solvency of its currency.  Corporations consult their own interests.  Unlike individuals, sentiment does not temper their dealings.  Their interests pointed toward cheap bonds and depreciated legal tenders.  They needed the bonds to bank upon, and when they were called upon to redeem their notes, the cheaper the greenbacks the less gold it would take of the interest on their bonds to supply them.  Accordingly, we find that the bonds decreased in value more rapidly after the bank act was passed than before.  Such would seem to have been the natural and sure result.  The banks supplied themselves with all the bonds they needed to bank upon at from fifty to sixty cents on the dollar, and, notwithstanding banknotes were redeemable in legal-tender greenbacks, legal tenders depreciated over 70 per cent.

If, however, Mr. Speaker, I am mistaken in all this, there can be no question about the present.  United States bonds are selling at a high premium;  legal-tender greenbacks are at par with gold and silver.  We do not need these fiscal agencies to enhance the value of our bonds or greenbacks, and therefore we cannot re-enact the bank law and extend this system for twenty years or longer for the reasons and purposes which influenced Congress twenty years ago to pass the original act.  We must look up some other excuse, some other reason and purpose to justify a practical re-enactment of the bank act as is proposed by this bill.  In consideration of the aid which it was supposed these fiscal agencies would give the Government in maintaining its credit the Government conferred upon them privileges, immunities, and favors of immense value.  In a Government like that of the United States, where every citizen is supposed to be equal before the law, and each alike entitled to its protection, such a system of class legislation, of governmental favoritism as the national banking system discloses is an enormity of the most frightful magnitude.  All other monopolies in this country are dwarfed into insignificance when compared with it.

I propose, Mr. Speaker, to show what some of these privileges, immunities, and favors are, and how they have been used and enjoyed by the banks.  Every association of five or more persons who may own and deposit in the Treasury of the United States $100,000 in bonds of the Government are entitled to receive $90,000 in unsigned bank notes.  The bonds remain in the Treasury and the interest thereon is paid quarterly by the Government to the bank.  The notes are signed by the officers of the bank and are used as capital for banking.  Each bank is authorized to operate for twenty ears.  Practically the capital of every five men thus associated together in a banking association is nearly doubled, almost free of cost to them.  One-half of it remains at the Treasury and earns interest;  the other half is loaned to the customers of the banks at from 6 to 24 per cent. per annum.  In order that these pets of the Government should have an open field in which to ply their vocation, all State banks were taxed out of existence.  Besides, they are permitted to bring all their suits in the United States courts without regard to the amount in controversy and without respect to the cost or inconvenience of unfortunate debtors.

Again, no tax can be laid upon their bonds, and all the legal-tender greenbacks held in reserve or placed to the credit of the surplus fund are likewise non-taxable.  While these are valuable privileges and favors, there are others far more valuable.  The national banks constitute a huge monopoly.  My friend from Pennsylvania, [Mr. Mutchler,] who has just delivered a very able speech in favor of the bill, affirms that the national banking system is not a monopoly, because every man in the United States who has the means to invest in bonds may become a national banker, and that, banking being free to all, can in no just sense be deemed a monopoly.  Now, I submit that the gentleman does not state the proposition quite accurately.  I affirm that the system is a monopoly the reason that banks alone can issue and put into circulation bank notes.  They enjoy monopoly in that respect.

If a farmer owns United States bonds, why may he not deposit them at Washington and have the privilege of taking home with him 90 or cent. of the amount in notes guaranteed by the Government to loan to his neighbor at the rate of interest allowed by the laws of the State in which he resides ?  Simply because under the law such a privilege is restricted solely to national banks.  I repeat that the currency of this country is its life-blood, and Congress has put it in the keeping of soulless corporations, who may increase or lessen its flow as their interest dictates or their caprice may suggest.  They can make money cheap to-day and to-morrow dear.  The property of the country and its entire business are at the mercy of the system.  We have now seven hundred and sixteen millions of paper currency, consisting of three hundred and forty-six millions legal-tender greenbacks and three hundred and seventy millions of national-bank notes.

The amount of greenbacks is fixed by law and cannot be decreased or increased except by law.  The representatives of the people in Congress must be consulted before the volume of greenback currency can be changed, but the banks alone control the volume of banknotes.  They are not responsible to the people.  The exercise of their power over the currency of the country is nowise regulated or limited by law.  Who can doubt or who will assume to say that such associations, with no legal restraints or limitations in this respect, united by common interests, inspired, as all business corporations are, by the greed of gain, do not constitute a dangerous and powerful enemy to every opposing interest in the land ?  The Comptroller's report for last year shows that in the last twelve years the national banks have distributed among their stockholders $517,825,392 of net profits, and have on hand besides $130,000,000 surplus funds, all earned upon an average capital of less than $500,000,000.  And we are to-day importuned on all sides to give a new lease of power to such an overshadowing monopoly.

The toiling millions of the country are again called upon, not as before in a time of war and wide-spread alarm;  not in a season of a general depression, when Government securities and credit were at a fearful discount;  not in a moment of extreme peril, when patriots seized every plausible expedient to restore the credit of the Government;  but in the silence of a profound peace, in the midst of comparative prosperity, with Government securities and credit far above par, to support this vast, unfeeling, grasping monopoly for another period of twenty years.  Such is the proposition, sir;  no more, no less.  Judging the future by the past, these institutions will gather into their coffers over a billion of dollars' profit and three hundred millions of surplus capital upon an investment of $500,000,000 in the next twenty years, the period proposed by this bill.  The brains and muscle of the country are proposed to be mortgaged for twenty years to earn such princely fortunes for the banks, and all for what ?  Absolutely for no consideration whatever.  The people do not need their currency, because the Government can furnish them currency direct, without cost;  and if, as as supposed, they aided at any time the Government in maintaining its credit, such aid no longer is needed nor desired.

We are under no obligation to the national banks, Mr. Speaker.  If their friends will continue to claim that they have rendered the Government in times past valuable services, I answer that long since all such services have been full paid for and the obligations discharged.  If they are to retire now, and forego for the future the exclusive rights and favors which they have enjoyed for twenty years under the legislation of Congress, they will have the satisfaction of knowing that they have gathered princely fortunes from the toil and labor of those whose interests they assume and pretend to have promoted.  We are told, sir, that the national banking system is friendly to the best interests of the people.  I deny that proposition, and I affirm that from the very day of its organization to the present time it has warred incessantly upon the rights and upon the best interests of the people;  that it has been ungrateful and selfish, and has used its power and exclusive privileges to increase the burden of taxation and embarrass the Government in every laudable effort it has made to lighten the weight of the public debt.

In other words, sir, this creature of Congress early became its master, and for twenty years has dictated, in the main, the financial laws and operations of the Government to its own advantage.  The proof is abundant to establish this proposition, but in the limits of my time only the most prominent facts can be presented.  I pass the period of the war for obvious reasons, nor will I weary the House to recapitulate the efforts of the banks between the close of the war and the first administration after its close to contract and destroy the greenback currency.  Among the first, if not the very first, act of Congress approved by President Grant was the act of 1869 entitled "An act to strengthen the public credit."  It will be remembered that about one billion and a half of the bonds were payable in lawful money.  It was so stipulated in the contract.  Greenbacks were lawful money, made so by law, and the Supreme Court affirmed the validity of the statute.  But unfortunately they were at a serious discount and far below par value in coin.

By the act referred to, all the securities, outstanding bonds, and currency of the Government were declared payable in coin, and the faith of the Government was pledged to discharge them in gold and silver.  This was in plain violation of the contract.  The terms of the contract did not admit of any dispute.  The history of that period records the fact that when the measure was before Congress the corridors around this Hall, the committee-rooms, above an below us, and the city itself, swarmed with the agents and attorneys of the banks who were here to influence the judgment of Congress and aid in the passage of that infamous act.  The work was accomplished.  It required great labor, for the work was infamous.  The public debt was increased $600,000,000 by the legal effect of the act, and the bonds held by the national banks alone were enhanced $25,000,000.  The banks owned about 356,000,000 of bonds.  They had purchased them at discount ranging from forty to sixty cents in dollar.  They were payable in lawful money, and might have been discharged in legal-tender greenbacks, which were then at a serious discount.

But these patriotic fiscal agencies, the banks, united by a common interest and influenced by a common greed, deliberately combined their power, which far exceeded all other influences, and secured the passage of this law, which created an additional burden of $600,000,000 upon the people for which there was absolutely no consideration and which was an unmixed fraud upon the taxpayers.  In 1870 Congress undertook to refund the public debt at a less rate of interest.  The bill originated in the Senate, and I beg to call attention to the eighth section of that measure as it passed the Senate.  It is as follows:

Sec. 8.  And be it further enacted, That on and after the 1st day of October, 1870, registered bonds of any denomination not less than $1,000, issued under the provisions of this act, and no other, shall be deposited with the Treasurer of the United States as security for notes issued to national banking associations for circulation  under an act entitled "An act to provide national currency secured by a pledge of United States bonds, and to provide for the circulation and redemption thereof," approved June 3, 1864;  and all national banking associations organized under said act,or any amendment thereof, are hereby required to deposit bonds issued by this act, as security for their circulating notes, within one year from the passage of this act, in default of which their right to issue notes for circulation shall be forfeited, and the Treasurer and the Comptroller of the Currency shall be authorized and required to take such measures as may be necessary to call in and destroy their outstanding circulation, and to return the bonds held as security therefor to the association by which they were deposited in sums of not less than $1.000:  Provided, That any such association now in existence may, upon giving thirty days' notice to the Comptroller of the Currency, by resolution of its board of directors, deposit legal-tender notes with the Treasurer of the United States to the amount of its outstanding circulation and take up the bonds pledged for its redemption.

When the bill came to the House the combined power of the national banks again appeared around this Hall and was everywhere visible.  The section was stricken out and the Senate was forced to accept the bill as amended, and thus amended it became the law.  I do not propose, Mr. Speaker, to animadvert upon this action of the banks.  Language which I control is too sterile to characterize it properly.  I content myself with reproducing an extract from the speech of Senator Sherman, who had charge of the bill, and who I believe was then, as he is now, the ablest financier of this country.  He said:

Mr. President, the three remaining sections of this bill apply to the national banks.  That is much too great a theme for me to enter upon at this stage of the debate; I will explain in a very few words the theory of those sections.  The national banks are mere creatures of law.  They hold their existence at the pleasure of Congress.  We may tomorrow, if it promotes the public interests, withdraw their authority.  The franchise has been valuable to them.

We think it right they should aid us in funding the public debt.  They hold of our securities $346,000,000.  Nearly all of these bear 6 per cent. interest in coin.  We will not deprive them of any them;  we will not take from them the property they enjoy;  we will not deny them even the payment of 6 per cent. as long as they are the owners of these bonds.  But they hold the franchise of issuing paper money guaranteed by the United States, and which constitutes the circulation of our country;  and we say that enjoying this franchise we now stipulate with them for the reduction of interest on the bonds they hold.  The provisions of this bill are not arbitrary.

We are about to retire and cancel our notes by the provisions of this act.  We are about to give them the monopoly of the circulation of this country, the sole and exclusive privilege of issuing paper money.  We have destroyed the State banks.  And now what do we require in return ?  That they shall join us in reducing the burdens of the public debt;  that they shall bear some little of their share of the loss of income which every holder of the public securities must suffer.

Sir, national banks would be very unwise indeed to make issue on this question.  If any man here is a friend of the national-bank system, I can claim to be.  I was here at its cradle, introduced the original banking bill and advocated it, and also introduced the amendment to it, conducted it, and saw it passed.  But if I believed now that the banks of the United States were unwilling to aid us in reducing the rate of interest on the public debt to the extent of the limited sacrifices they are called upon by this bill to make, I should certainly change very much my opinion of them and of the whole system.

I wish now to record my deliberate judgment that in this conclusion to which we have been compelled to arrive by the action of the House we are doing the national banks a great injury, which will impair their influence and power among the people, and that the opposition of the national banks to this provision which we have required them to aid in the funding of the public debt will tend more to weaken and destroy them than any thing that has transpired since their organization.  I do not see how we can go before the people of the United States and ask them to lend us gold at par for our bonds, when we refuse to require agencies of our own creation to take them;  when we even refuse to require new banks not yet organized to take those new bonds, and when we refuse to require old banks, which have made on the average from 15 to 20 per cent. annually upon the franchise.  But, sir, the vote of the House shows the power of the national banks.

It will be observed from what I have read that Mr. Sherman, if not the author of the plan of national banking, was the author of the original bank act of 1863 and the supplemental act of 1864.  Those acts, as passed, contained a reservation of the right to Congress to alter, amend, or repeal them.  This reservation was dropped out by the adoption of the Revised Statutes.  I call attention to this fact to show that, notwithstanding the banks were in the power of Congress and subject at any time to be destroyed by a repeal of the law, yet they boldly defied the power of Congress and defeated the laudable efforts of the Government to avail itself of their influence in lessening the interest on the public debt.  In this connection, Mr. Speaker, I desire to call attention to the conduct of the banks at the close of the last session of Congress.  In the opinion of a large majority of that Congress it was practicable to refund a portion of the public debt in 3 per cent. bonds, and a bill for that purpose passed both Houses.  That measure contained the following provision:

Section. 5.  From and after the 1st day of July, 1881, the 3 per cent. bonds authorized by this act shall be the only bonds receivable as security for national-bank circulation, or as security for the safe-keeping and prompt payment of the public money deposited with such banks:  Provided, That the Secretary of the Treasury shall not have issued all the bonds herein authorized, or so many thereof as to make it impossible for him to issue the amount of bond so required:  And provided further.  That no bond upon which interest has ceased shall be accepted or shall be continued on deposit as security for circulation or for the safe-keeping of the public money;  and in case of bonds so deposited shall not be withdrawn, as provided by law, within thirty days after the interest has ceased thereon, the banking association depositing the same shall be subject to the liabilities and proceedings on the part of the Comptroller provided for in section 5234 of the Revised Statutes of the United States:  And provided further, That section 4 of the act of June 20, 1874, entitled "An act fixing the amount of United States notes, providing for a redistribution of the national-bank currency, and for other purposes," be, and the same is hereby, repealed;  and sections 5159 and 5160 of the Revised Statutes of the United States be, and the same are hereby, re-enacted.
---[R.B. Hayes vetoed it on March 3, 1881.]

These fiscal agents of the Government were again called upon to aid in the reduction of the interest upon the public debt in part, and what was the result ?  Their agents and attorneys were on all sides plying their influence to defeat the bill.  They threatened to produce a panic.  They affirmed, and truthfully so, that the business of this country, vast as it is, was at their mercy, and rather than aid the Government to reduce the interest upon the bonds they would deposit lawful money in the Treasury and surrender their circulation, and thus contract the currency to the disturbance of business and the panic of capital.  Congress for one time boldly opposed the unreasonable exactions and demands of the banks, and disregarded their threats.  The bill was passed, eighteen millions of dollars were deposited by the banks in fifteen days pending the controversy, and the volume of currency to that extent was reduced.  Business felt the blow, and but for the resources of the Government, applied on the instant, a panic would have occurred.  As soon as the bill reached the President all the combined power and influence of the banks were concentrated and brought to bear upon the executive branch of the Government to secure a veto.  They triumphed and the bill fell.  In the muscular language of my friend from Missouri, [Mr. Bland] "they bulldozed the President."

We are now paying, Mr. Speaker, 3½ per cent. upon what are known as the Windom bonds, because of the defeat of the 3 per cent. funding act, which was brought about by the influence of national banks.  The act was in all respects reasonable, and the experience of the country since that time will attest the fact that our bonds drawing 3 per cent. interest could have been sold at par.

Mr. Randall.  Will the gentleman from Texas allow me to interrupt him a moment ?  Before the 1st of May, 1881, two months after the adjournment of the last Congress, the bonds of the United States had reached such a premium that they returned to those who purchased them at the market prices less than 3 per cent., showing clearly that those who had voted for the funding bill as passed at the close of the last Congress were right in the belief that a Government loan could be negotiated at 3 per cent.  I will hand to my friend from Texas, [Mr. Culberson,] to be incorporated in his remarks, a statement showing what income is yielded by 4 and 4½ per cent. Government bonds, at the market prices, on the 1st, 2d, 3d, 4th, and 5th days of the present month;  the 4½ per cent. bonds yielding an average of about 2.70 per cent. to purchasers at market prices, and the 4 per cent. bonds yielding about 2.86 per cent.  This is an official statement from the Treasury Department, the calculations having been made by Mr. Elliott, a recognized authority on subjects of this kind.

Mr. Culberson.  Mr. Speaker, by permission of the House I will insert the table in my remarks, which is as follows:

Statement of the prices (flat and net) of the 4 per cent. securities of the United States, redeemable after July 1, 1907, and the 4½ per cent. securities of the United States, redeemable after September 1, 1891;  together with the corresponding rates of interest realized to investors therein, for the 1st, 2d, 3d, 4th,and 5th days of May, 1882, respectively.

E.B. Elliot, Government Actuary. Treasury Department, May 6, 1882.

But, Mr. Speaker, the crowning act of all the outrages upon the interests of this country committed by the national banks was the part they took in the perpetration of that great financial crime, the demonetization of silver in 1873.  Of all the conspirators who aided in that dark and secret deed they are the most guilty, and if there are any degrees in the atrocity of that act they deserve the highest.  They owned about $370 000,000 of our bonds.  Originally the were purchased at a great discount.  Originally they were payable in lawful money, but as we have seen they had been converted without consideration into coin bonds, at the instance of the banks, payable in coin at its then standard value, and by which the banks reaped an immense harvest of profit.  Not satisfied with the immense powers, immunities, and exclusive privileges bestowed upon them by law, to some of which I have adverted, the banks deliberately conspired to break the financial peace of the count by demonetizing silver.

Silver was cheaper than gold, and their bonds being payable in coin, might lawfully be discharged in silver, the cheaper metal.  The silver currency was the currency of the people and occupied the field of circulation too completely for the interests of the bank notes.  It had to be destroyed.  It was destroyed and the national banks gathered again a rich harvest of profits by the enhancement of the value of their bonds and the appreciation of their notes.  But at what terrible costs, privation, and sacrifices to the people and business of the country !  Who, even now, Mr. Speaker, can look back over the period from 1873 to 1878, during which one-half of the metal currency of the world lay dormant and demonetized, and contemplate the frightful waste of values, the broken fortunes, the poverty and universal depression which marked that period without a feeling of indignation and shame ?

The history of our country, eventful as it has been, furnishes no parallel to the financial distress produced by the demonetization and withdrawal of silver from circulation.  The fires in the furnaces of our vast manufactories burned to ashes, vast enterprises of internal improvements were abandoned, labor ceased to command living wages and thousands upon thousands of able-bodied men trumped the country, vainly begging for work and living upon scant charity of those whom the crush had not entirely despoiled.  Properties of all kinds except national banking stock shrank in value with fearful rapidity, until State and municipal governments had no competition in bidders at tax sales, and all the financial gloom and depression was precipitated at a time when the country, torn to pieces by war, was struggling under a load of debt and taxation never before borne by any people with such heroic fortitude.

During this period the national banks made money with a rapidity which astonished the honest men connected with them, while the people grew poorer day by day.  Who of us does not remember the angry opposition of the banks to the remonetization of silver and its limited coinage as established by the "Bland bill" ?  Congress dared not falter in that work.  The will of the people had been heard.  It was the language of command.  We passed the bill in spite of the combined influences of the banks.  Again they concentrated all their power and influence upon the Executive, and the sad spectacle of the President of the United States cowering before this august monopoly was repeated.  He [Hayes, February 28, 1878.] vetoed the bill, but Congress made it the law notwithstanding his veto.

Mr. Hooker. [by not voting, he voted for it]  My friend from Texas will allow me to say right here, that the distinguished gentleman from Georgia, [Mr. Stephens] chairman of the Committee on Coinage, Weights, and Measures, stated to the House on the day that silver was demonetized, it constituted one-half of the metallic money of the world.  In addition that $346,000,000 of greenbacks were kept alive only by the action of a Democratic House.

The Speaker pro tempore.  The time of the gentleman from Texas has expired.

Mr. Bland. [voted against it]  I hope by unanimous consent he will be permitted to conclude his remarks.

Mr. Reagan. [voted against it]  I believe I am entitled to the floor, and I will yield to my colleague as much time as he desires.

The Speaker pro tempore.  The gentleman from Texas is entitled to the floor.

Mr. Reagan.  I yield to my colleague.

Mr. Culberson.  I will not trespass much longer on the indulgence of the House.  In 1874 the Republican party was defeated in the House of Representatives.  The triumph of the Democracy was an earnest protest filed by the people against the domination of banks over the legislation of Congress.  Yet this influence was in no wise daunted by the rebuke.  In the closing days of the last session of the Forty-third Congress it put in an appearance on the resumption bill, and fastened upon that measure a clause providing for the redemption and cancellation of the legal-tender greenbacks.  The work of destruction was going on when the Democrats, for the first time in twenty years, on the 4th day of December, 1875, presented a majority in the House of Representatives.  The whole financial policy of the Government since the war had been in the interests of national banks.  The Democratic party remonetized silver and partially restored its coinage.  All efforts to repeal the resumption law were defeated, except the proposition to rescue $346,000,000 of legal-tender greenbacks from destruction.  We saved that much of them to the people.

And thus we see, Mr. Speaker, that the policy of the banks was to convert the bonds which could be discharged in greenbacks into coin bonds, and when changed to make war on silver, the cheaper and most universal circulation, in order to have the bonds payable in gold only, to destroy the legal-tender currency as redeemed under the resumption act, so that the only currency should be gold and national bank notes.  When the Forty-fourth Congress assembled that policy had been ingrafted in the law.  We found it sanctioned by law.  In part the policy had been executed and was beyond the reach of repeal or modification.  The struggle to remonetize silver and the fight to sustain the remnant of the legal-tender currency show that if these banks could have triumphed we would to-day have no currency but old and national-bank notes.  My friend from Arkansas [Mr. Jones] in his able speech the other day presented the situation exactly.  He said there was an irrepressible conflict going on between banks on one side and silver and silver certificates on the other.

Such, Mr. Speaker, is the fact;  and because of that conflict we have propositions now pending to destroy silver and silver certificates.  Are these banks, therefore, not the enemies of the best interests of the people ?  Show me, if you can, where sentiment or patriotism or respect for the interests of the people, when opposed to their interests, ever tempered their grasping and cruel policy.  They are the open enemies of that grand principle which underlies our theory of government:  "All men are equal before the law and each alike is entitled to its protection."  Whenever the Government with one hand takes the money of a citizen and with the other bestows it upon a corporation it is no less a robbery because the transfer is made under the form and color of law.  Why should Congress, in the face of all these facts, give to the banks a new life, a new lease of power over the people ?  Does any one suppose that, if this bill should become a law, this system can ever hereafter be changed ?  Surely not.  The system is stronger to-day than at any time in the past.  It grows in strength year by year;  it has been powerful enough in the past to dictate laws to Congress and vetoes to Presidents.  Will it be less powerful or less grasping in the future ?  Has it not grown by the favors of Government until its strength is sufficient to defy the people and their representatives in Congress ?

I submit, Mr. Speaker, in view of the fact that a majority of this House seems determined to pass this bill, that the amendment offered by the gentleman from Pennsylvania [Mr. Randall] ought by all means to be adopted.  The power to contract the volume of currency now conferred on these corporations is so dangerous to the financial peace of the country that it should be limited by law.  Upon the policy of vesting the power to issue currency upon corporations I beg to read a short extract from a speech made by Mr. Benton, in 1834, in the Senate:

the government ought not to delegate this power, if it could.  It was too great a power to be trusted to any banking company whatever, or to any authority but the highest and most responsible which was known to our form of government.  The government itself ceased to be independent—it ceases to be safe—when the national currency is at the will of a company.  The government can undertake no great enterprise, neither of war nor peace, without the consent and co-operation of that company;  it cannot count its revenues for six months ahead without referring to the action of that company—its friendship or its enmity—its concurrence or opposition—to see how far that company will permit money to be plenty, or make it scarce;  how far it will let the moneyed system go on regularly, or throw it into disorder;  how far it will suit the interests, or policy, of that company to create a tempest, or to suffer a calm, in the moneyed ocean.  The people are not safe when a company has such a power.  The temptation is too great—the opportunity too easy—to put up and put down prices;  to make and break fortunes;  to bring the whole community upon its knees to the Neptunes who preside over the flux and reflux of paper.  All property is at their mercy.  The price of real estate—of every growing crop—of every staple article in market—is at their command.  Stocks are their playthings—their gambling theatre—on which they gamble daily, with as little secrecy, and as little morality, and far more mischief to fortunes, than common gamblers carry on their operations.

And now, to conclude what I have to say on this subject, I desire to submit that I consider the discontinuance of banking so important and desirable that I shall vote for every proposition which shall be offered for that purpose which does not assume that Congress has the power to issue an irredeemable Treasury note to circulate as money.  While the amendment which I propose provides for a simple and pure Treasury note redeemable in the dues to the Government, which presents a plan to which perhaps there is less objection than a one investing such notes with legal-tender quality, yet I am free to say that I will vote for either.  The question of the power of Congress to issue a legal-tender note I regard as settled by the judgment of the Supreme Court.  As a representative in Congress I am authorized to decide for myself whether such exigency exists as renders it necessary for Congress in this case to authorize the issuance and circulation of promises of the Government to pay money on demand for the time being invest such notes with legal-tender quality.

If war was flagrant and the demands upon the Government required it, there are few who would question the power of the Government to issue them or the soundness of the judgment of the court.  The exigency now presented is hardly less than such as war might present.  The banks are at war with the rights and interests of the people.  Their power has grown to be autocratic and despotic, and the issue of the struggle is in behalf of the people is by no means certain.  In behalf of those people whom I have the honor to represent and whose highest interest it is my ambition alone to serve, I would avail myself of any lawful means to crush out this kingly monopoly, which has usurped, under the color of law, the powers of Government and now exercises them to the scandal of republican government and the unblushing robbery of the people.

Mr. Mills. [by not voting, he endorsed it; so these nice words are just that]  Mr. Speaker, we have been informed by the friends of the national banks that within the next two years three hundred and ninety-three of these institutions will cease to exist by reason of the expiration of their charters;  that sixty-eight millions of their circulating notes will be retired;  that the monetary circulation of the country will to that extent be contracted;  that two hundred and seventeen of these banks expire in one day, and that fifty-four millions of the much-dreaded contraction will take place in the brief period of twenty-four hours.  We have been told how patriotic the banks were during the war, and how faithfully they stood by the country and supported its arms in its darkest hour of peril;  what a vast burden of taxes they have cheerfully borne since the war;  what small profits they have earned, and what constant and faithful friends they have been to the widow and the orphan.  If the national banks must cease to exist, they ask us where is there a house of refuge where the poor may find safe depository for their little a earnings !

These are not all of the good things that stand to their credit as the account has been stated by their zealous friends.  But before we become too deeply engrossed in the investigation of these statements we must solve a fundamental question that arises and confronts us at the very threshold of the country.  I say fundamental because it relates to the foundation on which the banking system stands.  That foundation laid twenty years ago is now sinking, and the super-structure is sinking with it.  When a man prepares to build a house the first thing he does is to secure a safe and permanent foundation.  The superstructure cannot stand when there is nothing for it to stand on.  Here we have a great financial superstructure erected twenty years ago, and built upon a vast national debt that it was thought by the statesmen of that day would last, like the English debt, forever.  But the calculation of the architects has come to naught, and we are paying that debt at the rate of one hundred and fifty millions a year.  If interests of the people shall control the councils of the nation, in a few years that debt will all be gone.  What do the friends of the system propose as a substitute for the foundation ?

It will not do to say that that question is premature and that we are beginning to borrow trouble before it comes.  It is not premature.  It is trifling with the question to so evade it.  It confronts us to-day and we must grapple with it now.  It is first in order of time, and it is first in order of importance.  Four hundred and fifty millions of the national bonds on which the banking system stands are subject to the call of the Government this very hour, and the Government is calling them in and paying them off at the rate of from twelve to fifteen millions per month.  If we live to see the 1st day of July, 1884, and our revenue system is permitted to stand till that time without change, we may congratulate the whole country that that whole sum will be extinguished and gone.  Two hundred and forty millions of that four hundred and fifty millions to-day is in the vaults of the national banks to secure their circulation and Government deposits.  When that is done what basis is to be substituted for the banks to stand on ?  What foundation has the gentleman from Massachusetts, [Mr. Crapo] the chairman of the committee, secured to serve as a basis for his banking system ?  Surely we are not building up a system to-day to be torn down to-morrow.

Will he say that the banks can buy up the bonds that mature in 1901 and bank on them ?  That cannot be done.  The premium on them is too great.  It is to-day 21 per cent., and it is steadily rising.  Last year, when we were discussing the 3 per cent. funding bill, the premium on these bonds was 14 per cent.  These bonds will become more valuable as the other bonds are paid off, and they are left alone in the market for banking and large investments.  Every dollar of the call bonds we pay still raises the value of the 4 per cent. bonds.  The law of supply and demand governs their price.  Just in proportion as the supply decreases the value increases.  These per 4 cent. bonds will probably go to 40 per cent. premium.  Will the banks give $140,000 $100,000 of bonds upon which they could only for draw 90,000 currency ?  The investment will not pay, and no one understands that fact better than the bankers.  The 4½ percents due in 1891 are at a premium of 14 per cent., and there are only two hundred and fifty millions of them.  What, then, are we to do ?

The foundation of the system is giving way, and there are only two things which can be done.  Either we must let the system and the foundation on which it stands tumble together, or we must make the foundation secure.  The people of this country are not going to be left without some kind of paper circulation.  The time is forever past in this country when its vast commercial business will be done solely on a metallic circulation.  That was the idea of our grand fathers when the ox-cart was the vehicle of exchange instead of the railroad --that was before the days of steam and electricity, before the time of the telegraph and the steam-engine, before the time when men talked beneath the sea from one continent to another.  That was the policy that antagonized wild-cat banks and shinplasters.  But, happily for the people of this country, knowledge is still extending its boundaries, and we have learned that convenience is a thing of value.  The people of this country are too wise to return to a purely metallic circulation when they can have a paper circulation based on gold and silver and convertible into it at the pleasure of the holder.  As they will never return to a purely metallic circulation, so they will never go to the other extreme of a purely paper circulation.

But they will have a paper dollar based on a gold and silver dollar and redeemable in it at the pleasure of the holder.  A paper dollar thus based is equally valuable with gold and silver and has the superior advantage of convenience.  Now, then, what are we to have for the basis ?  If we retain the national banking system we must perpetuate the debt.  My colleague, in his terrible arraignment of the banks, every word of which was true, ought to have crowned the climax of his speech by reiterating the charge of General Jackson, that they were constantly conspiring to perpetuate a national debt upon the people.  He showed the motives that always impel them.  It is not always philanthropy, nor patriotism;  nor is it always a sleepless devotion to the widow and the orphan.  They do not look to interests of the people as we do, for we are the servants of the people.  Our interests are the interests of our constituents.

The interests of the banks are directly the reverse.  Their interest is to keep the debt and keep the people taxed year by year to pay its interest of forty or fifty millions for their benefit.  The in the interest of the people is to pay the debt and repeal the tax and keep their earnings in their own pockets.  The banking system is at war .......


elasticity
page 4097

Mr. Buckner.  I move to amend by inserting the provision which I send to the desk.

The Clerk read as follows:

That no new or additional bank-note circulation be issued, either by a new bank or any increase of circulation of banks already organized be issued without a similar notice filed in the office of the Secretary of the Treasury ninety days before the date of the articles of incorporation, or period when said increase of circulation shall be made, and which said notice shall be subscribed by at least five of the incorporators of said bank, and shall state the name of the bank, its proposed location, the character of bonds to be deposited in the Treasury, and the amount of circulation to be issued thereon.

Mr. Buckner.  Mr. Speaker, I desire to congratulate my friends on the other side, upon the great advance they are making on this question of circulation.  The "elasticity," the India-rubber character of the national-bank circulation has been the chief recommendation urged in its favor.  It has been claimed that the amount of this currency would conform itself to the business wants of the country.  Now, we have a proposition from my friend from Massachusetts, the chairman of the Committee on Banking and Currency, which in effect abandons this idea and proposes to provide that the banks shall not be at liberty to withdraw their bonds at pleasure upon the surrender of a corresponding amount of circulation.  My amendment extends this restriction to expansion of the currency as well as to contraction.  By the act of 1874 this principle of "elasticity," this India-rubber principle, was introduced, and has since been claimed as the chief virtue of the national banking system.  But now my friend from Massachusetts says that this principle must be abandoned, and it must be provided that no more than so many millions of dollars per month shall be withdrawn.

I congratulate gentlemen on the other side, as well as the country, that they are abandoning this abominable idea that the volume of the currency of the country, by the operation of the national banking system, can be adapted, as they have claimed, to the wants of the businesses of the country.  In other words, it is proposed that the banks shall no longer contract their circulation at their pleasure.  Now, why not apply the same principle to prevent an undue expansion of the currency ?  Why not throw some obstacle in the way of the banks enlarging their circulation to just such an extent as they may desire ?  That is the object of this amendment, nothing else.  While we are providing against too rapid contraction why not say that the national-bank circulation shall not be enlarged at the mere will or caprice of the banks ?

Mr. Hutchins.  Is the gentleman in favor of this amendment ?

Mr. Buckner.  Certainly I am.  I have proposed to submit, as an amendment to this bill, a provision to fix permanently in some form or other the amount of this circulation.  I see that gentlemen on the other side, and especially my friend from Illinois, [Mr. Cannon] begin to be alarmed about what I have been preaching here for the last two or three months.  I apprehend that some bank somewhere in Illinois---

Mr. Cannon.  My friend claims that I am getting alarmed at his preaching;  but after I get alarmed, he goes back on me and votes the other way.

Mr. Buckner.  Not at all.  If I have time I will show that my friend's proposition means further contraction.  Though it may be in the interest of some bank of $100,000 or $150,000 capital, it means contraction.  Some bank somewhere --probably in my friend's district, though I will not say that it is-- has $100,000 in 3½ per cent. bonds liable to be called, as they certainly must be within the next two or three years.  My friend says that the banks will not buy 4 per cent. or 4½ per cent. bonds at the present premium.  Now, what is such a bank to do ?  When its $100,000 of bonds are called in $90,000 of circulation goes out of existence.  But the bank does not wish to give up altogether its circulation and cease to do business as a national bank;  therefore it is willing to deposit $10,000 of bonds and issue $9,000 of circulation.  What is this but a contraction of 81,000 in addition to what is already going on ?

Mr. Cannon.  The gentleman, I know, wants to get this matter right.

Mr. Buckner.  Yes, sir.

Mr. Cannon.  Would there not a greater contraction if the bank should go out of existence altogether and retire the whole of its circulation ?

The Speaker.  The time of the gentleman from Missouri has expired.

Mr. Buckner's amendment was rejected.

the Comptroller of the Currency is hereby authorized, in the manner provided by, and under the conditions and limitations of the act of July 12, 1882, to extend for a further period of twenty years the charter of any national banking association extended under said act which shall desire to continue its existence after the expiration of its charter.

That all the interest-bearing indebtedness of the United States now due or optional with the Government, and all other interest-bearing indebtedness as it shall hereafter become due, shall be paid in lawful money of the United States.

Section 2.  That all money now in the Treasury, and all revenues of the United States Government not otherwise appropriated, shall be applied in payment of the interest-bearing debt.

Section 3.  That the Secretary of the Treasury be, and he is hereby authorized and required to issue non-interest-bearing Treasury notes of the United States of the denominations of one, two, five, ten, twenty, fifty, and one hundred dollars, which shall be made lawful money and a legal tender at its face value for all taxes, revenues, and debts, public and private, within the United States, which may be necessary in addition to the aforesaid money and revenues to pay the said interest-bearing debt now due, and also the interest-bearing debt now optional with the Government, and all other interest-bearing debts as they shall respectively become due.

That the Secretary of the Treasury is hereby authorized and required to issue Treasury notes made a full legal tender and lawful money in denominations convenient for currency, and in quantity equal to any contraction which may be caused by the withdrawal of national-bank notes.

Section 4.  That all acts and parts of acts in conflict herewith be, and the same are hereby, repealed.

Mr. Haseltine.  Mr. Speaker, the bill under consideration proposes to extend the time in the discretion of the bankers during the next twenty years to control the issuing of paper currency.  It will give the banks power to inflate or contract, and cause panics and hard times whenever they may choose to do so.  Such legislation would place the American people at the mercy of a few national bankers.  During the period of hard times, when silver was demonetized, and a large contraction of the currency caused by the destruction of the people's paper currency, the national banks contracted their circulation $29,305,485.  This contraction was from January 14, 1875, to May 31, 1878.  In March, 1881, the bankers contracted their circulation $18,000,000.  This is the way they regulate the currency according to the demands of the people.

In the language of Jefferson, "the circulating medium must be restored to the nation to whom it belongs."  We see no necessity for granting such special privileges to a few capitalists.  Legal-tender paper currency, better than gold, should take the place of national-bank paper and stop all interest upon the bonds which now serve as the basis of the bank circulation.  Pay the bonds, and restore to the people that currency which has been wrongfully taken from them.  The gentleman from Massachusetts [Mr. Crapo] says:

The pressing exigencies of the Government and the urgent condition of its finances, which prompted the creation of the banks, have not been forgotten;  neither have the valuable and substantial benefits which through them were secured in the placing of the public debt and the maintenance of the public credit.

It was the "pressing exigencies" of bankers and money speculators, who were largely represented in Congress and who filled the lobbies, "which prompted" this creation, or rather, fastened this aristocracy of money speculators upon the American people during the last twenty years.  There was but a very limited amount of bank circulation during the war.  The Government issued notes after the establishment of national banks ---[these were 7.3% interest-bearing treasury notes, not greenbacks]:

August 15, 1864. ......... $299,992,500
June 15, 1865. ........... $321,000,000
July 15, 1865. ........... $193,000,000
.......................... $829,992,500

After the war the bankers were very brave in "maintaining the public credit," in influencing the Government to change the people's currency into an interest-bearing debt as the basis for national banks.  Senator Wilson, on February 13, 1862, page 787 Congressional Globe, second session, Thirty-seventh Congress, describes this class of public benefactors, when they were using their influence to cause depreciation of the people's currency by putting the word "except" in the greenback.  He says:

I look upon this contest as a contest between the curbstone brokers, the Jew brokers, the money-changers, and the men who speculate in stocks, and the productive, toiling men of the country.

Thaddeus Stevens ---[the bank lawyer], in speaking of this class of patriots, says:

The banks took $50,000,000 of six per cent. bonds, and shaved the Government $5,500,000 on them, and now ask to shave the Government fifteen or twenty per cent. half yearly, to pay themselves the interest on these very bonds.  They paid for the $50,000,000 in demand notes, not specie, and now demand the specie for them.

This is the class of philanthropists who wanted national banks to issue the currency.  The gentleman from Massachusetts [Mr. Crapo] says:

I do not fear that the delusion which declares that a piece of paper stamped "one dollar" is equal to 25.8 grains of gold with the stamp, and which seeks by the despotic authority of law to create for it the same value and believes it can fulfill the same function in wiping out debt, will ever prevail with the majority in this country.

The depositing of gold coins in exchange for silver certificates, based upon eighty-eight cents standard fiat silver dollars, should be sufficient to satisfy the gentleman.  (See official statements.)

Treasury department, Secretary's office,
Washington, D.C., September 18, 1880.
Until further notice the United States assistant treasurer at New York will pay out at his counter standard silver dollars or silver certificates in sums of $10, or any multiples thereof, in exchange for like amounts of gold coin or gold bullion deposited with him.
John Sherman, Secretary.

See page 10, report of the Treasury made to this House.

The Department has issued silver certificates at the several sub-treasury offices, upon a deposit of gold coin in like amount with the assistant treasurer at New York, and through this means certificates have been issued for nearly all the silver held by the Treasury.  These certificates amount to about sixty-six million and are now outstanding.

On the 1st day of November 1881, the Acting Secretary of the Treasury suspended the issue of silver certificates in exchange for gold by issuing Department circular No. 108, as follows:

Treasury Department, Secretary's Office,
Washington, D.C., November 1, 1881.
Until further notice the exchange of silver certificates for gold coin deposited at the office of the United States assistant treasurer at New York will be suspended, and Department circular No. 75, of September 8, 1880, is hereby modified accordingly.
H.F. French, Acting Secretary.

The fiat silver certificates are preferred to gold coins.  The full legal-tender greenbacks are preferred to either.  Why not authorize the Secretary of the Treasury to issue the full legal-tender paper currency in the place of the national-bank notes ?

The gentleman from Missouri [Mr. Bland] said:

Nature will supply these metals to this nation and to all nations alike, and hence the volume of money will be steady.

The gentleman would limit the currency of civilization to metal money, or paper based upon metal money.  This would be an absurdity, to limit all business and all progress to the accidental discovery of certain metals.  I will show this more fully in my subsequent remarks.

Mr. Speaker the Constitution of the United States established a government.  It has jurisdiction over all those general subjects of legislation and sovereignty which affect the interests of the whole people equally and alike, and which require uniformity of regulations and laws, as defined by the Constitution.  No one doubts at the present day, nor has ever seriously doubted the power of the Government to emit bills of credit.  It has been exercised by the Government without question for a large portion of its history.  This being conceded, the incidental power of giving such bills the quality of legal tender follows as a matter of course.

Clause 2, section 8, of the first article of the Constitution, provides for borrowing money on the credit of the United States.  The power to borrow money carries with it the power to give to the lender an evidence of the debt thus created, and to make the Treasury note as valuable as possible by giving it the power to perform all the functions of money.  It should therefore be a legal tender at its face value for all debts and dues, public and private.

The existence of the war only increased the urgency of the Government for funds;  it did not add to its powers to raise such funds, or change, in any respect, the nature of those constitutional powers or transactions.  Therefore that power which gave us prosperity in war may give us prosperity in peace.

Clause 3, section 8, of article 1, says:

Congress shall have power to regulate commerce with foreign nations, and among the several States, and with the Indian tribes.

Money is an essential element of commerce.  It is as much the means or instrument of trade, as navigation or transportation is of intercourse;  and is equally included in the regulation of commerce.  Therefore it is of the greatest importance that Congress should provide a uniform currency among all the States.  Daniel Webster sustains this proposition in this language:

It is clear that the power to regulate commerce among the States carries with it, not impliedly, but necessarily and directly, a full power to regulate the essential element of commerce, namely, the currency of the country, the money which constitutes the life and soul of commerce.(Webster's speech on surplus revenue, 4th works, 315.)

Article 1, clause 5, section 8, says:

Congress shall have power to coin money and regulate the value thereof.

The words "to coin," a verb, as defined by Webster, "is to form, fashion, fabricate, or convert into money."  "To regulate the valu thereof" is to assign it a value;  that is, to determine its denominations as money, and the amount necessary to promote the general welfare, without any regard or reference to the commodity value of the substance which shall thus be converted into money.  That material is best which is most convenient in use and least expensive to government.  Congress is not limited by the Constitution as to the materials that may be used for the purposes of money.  The expression "to coin," as used in the Constitution, has no definite or fixed reference to any substance or commodity value.  It is affixing the authority of the Government to the substance which is converted into money.  The Constitution nowhere provides in express terms that Congress shall have power to make gold and silver a legal tender.

We ought to talk of coining notes, for though the design impressed upon paper instead of metal, the function of the note is exactly the same as that of a representative token. --Jevons, Money and the Mechanism of Exchange, page 318.

Anderson, in his Manual of the Constitution, page 110, says:

The power to coin money is an attribute of sovereignty, and is therefore properly placed with the General Government.  Without doubt Congress would have possessed the power had the Constitution contained no specific grant to this effect.  A subsequent section prohibits the States from coining money.

On this point the opinion of Daniel Webster ---[a bank-lawyer, fervently opposed the issuing of treasury notes], who won the title of "Constitutional Expounder," is timely and conclusive ---[when, where, in what context did he say this?]:

By denying the State[s] all power of emitting bills of credit, or making anything but gold and silver a tender in payment of debts, the whole control over the standard of value and medium of payments vested the General Government.  Delegating this grant to Congress and prohibition [prohibiting] to the States, a just reading of the provisions is this:  "Congress shall have power to coin money, emit bills of credit, and make anything besides gold and silver legal tender in payment of debts."

Franklin said that the statesmen of Europe could not understand how America carried on a war for several years without any specie.

The States possessed and exercised the power to make money out of other materials than the metals, and when they came into the confederation they did not relinquish the power, but when the people of all the colonies united "to form a more perfect Union," they took from the States the control of the money and gave it to the General Government.  Congress has clearly defined constitutional power to declare what shall circulate as money within the United States, in the regulation of commerce, a power which is exercised by all sovereign nations upon the earth.

The amount of the currency of the country should bear a certain proportion to its trade, revenue, population, and expenditures.  The business of civilization cannot be limited in any degree to the accidental discovery of any metal, or to the selfish interests of any company of usurers, Shylocks, and sharpers.  The best money for the American Republic is that which can be controlled by Congress in the quantity adapted to the increase of population and the increasing business of civilization, and which shall have the money power given exclusively by law, and controlled by the people through their representatives.  The policy of the American statesman should be to gradually increase the currency to correspond with the increase of population, thereby stimulating the industries and increasing the stock of labor, in which consists all real power and riches.

Money is the legal measure and representative of value.  There is no commodity value in money.  The Supreme Court has truthfully said, "Value is an ideal thing;"  and its measure must of necessity be ideal.  Every sovereign power on the earth has established by law what shall be the legal representative of value.  There can be no such thing as a standard of value.  Value, strictly speaking, begins and ends with human desires.  There can be a standard of anything which has weight, length, breadth, or thickness, but not of a thing which is ideal.  The Supreme Court has said, "The gold or silver thing we call a dollar is in no sense a standard of a dollar.  It is a representative of it."

The law power fixes this representative.  Money is that which law requires the creditor to receive in payment for debts.  The great political economist, Say, has shown that most of the European wars of the seventeenth and eighteenth centuries grew out of false principles relating to this subject.  The destruction of the people's money in the American colonies by the English Parliament was one of the great causes of the American Revolution.  The contraction of the currency in England in 1820 caused suffering, starvation, cries for bread, a shouting of the hungry people.  The recent fearful suffering, labor strikes, and great destruction of property in this country were the result of a false financial policy.  Governor Mosgrove recently said:

I suppose the teachers of no science have so much human misery to answer for or have assisted so much fraud as the doctors of political economy.

Aristotle, the great Grecian philosopher, was right when he said, "Law makes money."  And his pupil, the great Plato, said, "that is worth most for a nation's currency which is worth least to other nations."  Our Franklin taught the same philosophy.  Money issued wholly by the Government and not by bankers or interested parties would be perfectly safe from abuse, and it would put an end to that periodical fluctuation of prices, commercial crises, panics, paralyzation of industry, pauperism, and crime which have cursed every land where usurious Shylocks have controlled the issuing of currency in the interest of individuals independent of the government.

Mr. Calhoun, of South Carolina, said in the Senate, September 19, 1837 ---[he was talking about non-legal-tender Treasury notes, promising to pay coin]:

It appears to me, after bestowing the best reflection I can give the subject, that no convertible paper --that is, no paper whose credit rests upon a promise to pay-- is suitable for currency. *****
I would ask, then, why should the Government mingle its credit with that of private corporations ?  No one can doubt but that the Government credit is better than that of any bank-more stable and more safe.  Why, then, should it mix it up with the less perfect credit of those institutions ?  Why not use its own credit to the amount of its own transactions ?

Thomas Jefferson, in his letter to Mr. Epps, said ---[he was talking about non-legal-tender evidences of debt, redeemed after set number of years]:

Bank paper must be suppressed, and the circulating medium must be restored to the nation to whom it belongs.  It is the only fund on which they can rely for loans;  it is the only resource which can never fail them, and it is an abundant one for every necessary purpose.  Treasury bills, bottomed on taxes, bearing or not bearing interest, as may be found necessary, thrown into circulation will take the place of so much gold and silver, which last, when crowded, will find an efflux into other countries, and thus keep the quantum of medium at its salutary level.

Benjamin Franklin, in reference to our currency, said:

On the whole, no method has hitherto been found to establish a medium of trade, equal in all its advantages to bills of credit, made a general legal tender.  Paper money, well founded, has great advantages over gold and silver, being light and convenient for handling in large sums, and not likely to be reduced by demands for exportation.

Mr. Calhoun also said ---[non-legal-tender Treasury notes]:

The suggestions, which he [Daniel Webster] has so perverted, have been a favourite topic of attack on the part of the senator [Daniel Webster], but he has never yet stated, nor met what I really said truly and fairly;  and, after his many and unsuccessful attempts to show what I suggested to be erroneous, I now undertake to affirm positively, and without the least fear that I can be answered, what heretofore I have but suggested --that a paper issued by government, with the simple promise to receive it in all its dues, leaving its creditors to take it, or gold and silver, at their option, would, to the extent that it would circulate, form a perfect paper circulation, which could not be abused by the government;  that would be as steady and uniform in value as the metals themselves;  and that if, by possibility, it should depreciate, the loss would fall, not on the people, but on the government itself;  for the only effect of depreciation would be virtually to reduce the taxes, to prevent which the interest of the government would be a sufficient guarantee.  I shall not go into the discussion now, but on a suitable occasion I shall be able to make good every word I have uttered.  I would be able to do more --to prove that it is within the constitutional power of Congress to use such a paper, in the management of its finances, according to the most rigid rule of construing the Constitution;  and that those, at least, who think that Congress can authorize the notes of private State corporations to be received in the public dues, are estopped from denying its right to receive its own paper.

The framers of the Constitution had been accustomed to the use of legal-tender paper money.  Each of the colonies issued its money of paper and made it a tender in payment of debts until the Parliament of England took from them this power.  At the very beginning of the war Massachusetts and other colonies disregarded the prohibition, and again declared their bills a legal tender. (Bancroft's History, volume 7, page 324.)

From the formation of the union of the colonies in 1774 to the adoption of the present Constitution, the money of the country was mostly paper.  It was that paper that gave us a country, as it was the greenback that saved us as a nation.

The United States Supreme Court, in December, 1870, (12 Wall) fully sustained our views, in the following language:

Indeed, legal tender Treasury notes have become the universal measure of values.  If now, by our decision, it be established that these debts and obligations can be discharged only by gold coin; if, contrary to the expectation of all parties to these contracts, legal tender notes are rendered unavailable, the government has become an instrument of the grossest injustice; all debtors are loaded with an obligation it was never contemplated they should assume; a large percentage is added to every debt, and such must become the demand for gold to satisfy contracts, that ruinous sacrifices, general distress, and bankruptcy may be expected.  These consequences are too obvious to admit of question.  And there is no well founded distinction to be made between the constitutional validity of an act of Congress declaring Treasury notes a legal tender for the payment of debts contracted after its passage and that of an act making them a legal tender for the discharge of all debts, as well those incurred before as those made after its enactment.  There may be a difference in the effects produced by the acts, and in the hardship of their operation, but in both cases, the fundamental question, that which tests the validity of the legislation, is can Congress constitutionally give to Treasury notes the character and qualities of money? Can such notes be constituted a legitimate circulating medium having a defined legal value? If they can, then such notes must be available to fulfill all contracts (not expressly excepted) solvable in money, without reference to the time when the contracts were made.

Making the notes legal tenders gave them a new use, and it needs no argument to show that the value of things is in proportion to the uses to which they may be applied.

The case of Veazie Bank v. Fenno presents a suggestive illustration.  There, a tax of ten percent on state bank notes in circulation was held constitutional, not merely because it was a means of raising revenue, but as an instrument to put out of existence such a circulation in competition with notes issued by the government.  There, this Court, speaking through the Chief Justice, avowed that it is the constitutional right of Congress to provide a currency for the whole country; that this might be done by coin, or United States notes, or notes of national banks, and that it cannot be questioned Congress may constitutionally secure the benefit of such a currency to the people by appropriate legislation.  It was said there can be no question of the power of this government to emit bills of credit; to make them receivable in payment of debts to itself; to fit them for use by those who see fit to use them in all the transactions of commerce; to make them a currency uniform in value and description, and convenient and useful for circulation.  Here the substantive power to tax was allowed to be employed for improving the currency.  It is not easy to see why, if state bank notes can be taxed out of existence for the purposes of indirectly making United States notes more convenient and useful for commercial purposes, the same end may not be secured directly by making them a legal tender.

Concluding, then, that the provision which made Treasury notes a legal tender for the payment of all debts other than those expressly excepted was not an inappropriate means for carrying into execution the legitimate powers of the government, we proceed to inquire whether it was forbidden by the letter or spirit of the Constitution.  It is not claimed that any express prohibition exists, but it is insisted that the spirit of the Constitution was violated by the enactment.

Here those who assert the unconstitutionality of the acts mainly rest their argument.  They claim that the clause which conferred upon Congress power "to coin money, regulate the value thereof, and of foreign coin," contains an implication that nothing but that which is the subject of coinage, nothing but the precious metals can ever be declared by law to be money, or to have the uses of money.  If by this is meant that because certain powers over the currency are expressly given to Congress, all other powers relating to the same subject are impliedly forbidden, we need only remark that such is not the manner in which the Constitution has always been construed.  On the contrary it has been ruled that power over a particular subject may be exercised as auxiliary to an express power, though there is another express power relating to the same subject, less comprehensive.  There an express power to punish a certain class of crimes (the only direct reference to criminal legislation contained in the Constitution), was not regarded as an objection to deducing authority to punish other crimes from another substantive and defined grant of power.  There are other decisions to the same effect.

To assert, then, that the clause enabling Congress to coin money and regulate its value tacitly implies a denial of all other power over the currency of the nation, is an attempt to introduce a new rule of construction against the solemn decisions of this Court.  So far from its containing a lurking prohibition, many have thought it was intended to confer upon Congress that general power over the currency which has always been an acknowledged attribute of sovereignty in every other civilized nation than our own, especially when considered in connection with the other clause which denies to the states the power to coin money, emit bills of credit, or make anything but gold and silver coin a tender in payment of debts.

We do not assert this now, but there are some considerations touching these clauses which tend to show that if any implications are to be deduced from them, they are of an enlarging rather than a restraining character.  The Constitution was intended to frame a government as distinguished from a league or compact, a government supreme in some particulars over states and people.  It was designed to provide the same currency, having a uniform legal value in all the states.  It was for this reason the power to coin money and regulate its value was conferred upon the federal government, while the same power as well as the power to emit bills of credit was withdrawn from the states.  The states can no longer declare what shall be money, or regulate its value.  Whatever power there is over the currency is vested in Congress.  If the power to declare what is money is not in Congress, it is annihilated.  This may indeed have been intended.  Some powers that usually belong to sovereignties were extinguished, but their extinguishment was not left to inference.  In most cases, if not in all, when it was intended that governmental powers, commonly acknowledged as such, should cease to exist, both in the states and in the federal government, it was expressly denied to both, as well to the United States as to the individual states.  And generally, when one of such powers was expressly denied to the states only, it was for the purpose of rendering the federal power more complete and exclusive.

Why, then, it may be asked, if the design was to prohibit to the new government, as well as to the states, that general power over the currency which the states had when the Constitution was framed, was such denial not expressly extended to the new government, as it was to the states ?  In view of this, it might be argued with much force that when it is considered in what brief and comprehensive terms the Constitution speaks, how sensible, its framers must have been that emergencies might arise when the precious metals (then more scarce than now) might prove inadequate to the necessities of the government and the demands of the people -- when it is remembered that paper money was almost exclusively in use in the states as the medium of exchange, and when the great evil sought to be remedied was the want of uniformity in the current value of money, it might be argued, we say, that the gift of power to coin money and regulate the value thereof was understood as conveying general power over the currency, the power which had belonged to the states, and which they surrendered.

Such a construction, it might be said, would be in close analogy to the mode of construing other substantive powers granted to Congress.  They have never been construed literally, and the government could not exist if they were.  Thus the power to carry on war is conferred by the power to "declare war."  The whole system of the transportation of the mails is built upon the power to establish post offices and post roads.  The power to regulate commerce has also been extended far beyond the letter of the grant.  Even the advocates of a strict literal construction of the phrase, "to coin money and regulate the value thereof," while insisting that it defines the material to be coined as metal, are compelled to concede to Congress large discretion in all other particulars.

The Constitution does not ordain what metals may be coined, or prescribe that the legal value of the metals, when coined, shall correspond at all with their intrinsic value in the market.  Nor does it even affirm that Congress may declare anything to be a legal tender for the payment of debts.  Confessedly the power to regulate the value of money coined, and of foreign coins, is not exhausted by the first regulation.  More than once in our history has the regulation been changed without any denial of the power of Congress to change it, and it seems to have been left to Congress to determine alike what metal shall be coined, its purity, and how far its statutory value, as money, shall correspond, from time to time, with the market value of the same metal as bullion.

How then can the grant of a power to coin money and regulate its value, made in terms so liberal and unrestrained, coupled also with a denial to the states of all power over the currency, be regarded as an implied prohibition to Congress against declaring Treasury notes a legal tender, if such declaration is appropriate, and adapted to carrying into execution the admitted powers of the government ?

We do not, however, rest our assertion of the power of Congress to enact legal tender laws upon this grant.  We assert only that the grant can, in no just sense, be regarded as containing an implied prohibition against their enactment, and that, if it raises any implications, they are of complete power over the currency, rather than restraining.

We come next to the argument much used, and indeed the main reliance of those who assert the unconstitutionality of the legal tender acts.  It is that they are prohibited by the spirit of the Constitution because they indirectly impair the obligation of contracts.

The argument, of course, relates only to those contracts which were made before February, 1862, when the first act was passed, and it has no bearing upon the question whether the acts are valid when applied to contracts made after their passage.  The argument assumes two things -- first, that the acts do, in effect, impair the obligation of contracts, and second, that Congress is prohibited from taking any action which may indirectly have that effect.  Neither of these assumptions can be accepted.  It is true that under the acts, a debtor, who became such before they were passed, may discharge his debt with the notes authorized by them, and the creditor is compellable to receive such notes in discharge of his claim.

But whether the obligation of the contract is thereby weakened can be determined only after considering what was the contract obligation.  It was not a duty to pay gold or silver, or the kind of money recognized by law at the time when the contract was made, nor was it a duty to pay money of equal intrinsic value in the market.  (We speak now of contracts to pay money generally, not contracts to pay some specifically defined species of money.) The expectation of the creditor and the anticipation of the debtor may have been that the contract would be discharged by the payment of coined metals, but neither the expectation of one party to the contract respecting its fruits nor the anticipation of the other constitutes its obligation.  There is a well recognized distinction between the expectation of the parties to a contract and the duty imposed by it.

Were it not so, the expectation of results would be always equivalent to a binding engagement that they should follow.  But the obligation of a contract to pay money is to pay that which the law shall recognize as money when the payment is to be made.  If there is anything settled by decision, it is this, and we do not understand it to be controverted.

No one ever doubted that a debt of one thousand dollars, contracted before 1834, could be paid by one hundred eagles coined after that year, though they contained no more gold than ninety-four eagles such as were coined when the contract was made, and this, not because of the intrinsic value of the coin, but because of its legal value.  The eagles coined after 1834 were not money until they were authorized by law, and had they been coined before, without a law fixing their legal value, they could no more have paid a debt than uncoined bullion, or cotton, or wheat.

Every contract for the payment of money simply is necessarily subject to the constitutional power of the government over the currency, whatever that power may be, and the obligation of the parties is therefore assumed with reference to that power.  Nor is this singular.  A covenant for quiet enjoyment is not broken, nor is its obligation impaired, by the government's taking the land granted in virtue of its right of eminent domain.  The expectation of the covenantee may be disappointed.  He may not enjoy all he anticipated, but the grant was made and the covenant undertaken in subordination to the paramount right of the government.

We have been asked whether Congress can declare that a contract to deliver a quantity of grain may be satisfied by the tender of a less quantity.  Undoubtedly not.  But this is a false analogy.  There is a wide distinction between a tender of quantities, or of specific articles, and a tender of legal values.  Contracts for the delivery of specific articles belong exclusively to the domain of state legislation, while contracts for the payment of money are subject to the authority of Congress, at least so far as relates to the means of payment.  They are engagements to pay with lawful money of the United States, and Congress is empowered to regulate that money.  It cannot, therefore, be maintained that the legal tender acts impaired the obligation of contracts.

Nor can it be truly asserted that Congress may not, by its action, indirectly impair the obligation of contracts, if by the expression be meant rendering contracts fruitless, or partially fruitless.  Directly it may, confessedly, by passing a bankrupt act, embracing past as well as future transactions.  This is obliterating contracts entirely.  So it may relieve parties from their apparent obligations indirectly in a multitude of ways.  It may declare war, or, even in peace, pass non-intercourse acts, or direct an embargo.  All such measures may, and must operate seriously upon existing contracts, and may not merely hinder, but relieve the parties to such contracts entirely from performance.

It is then clear that the powers of Congress may be exerted, though the effect of such exertion may be in one case to annul, and in other cases to impair the obligation of contracts.  And it is no sufficient answer to this to say it is true only when the powers exerted were expressly granted.  There is no ground for any such distinction.  It has no warrant in the Constitution, or in any of the decisions of this Court.  We are accustomed to speak for mere convenience of the express and implied powers conferred upon Congress.  But in fact the auxiliary powers, those necessary and appropriate to the execution of other powers singly described, are as expressly given as is the power to declare war, or to establish uniform laws on the subject of bankruptcy.  They are not catalogued, no list of them is made, but they are grouped in the last clause of section eight of the first article, and granted in the same words in which all other powers are granted to Congress.  And this Court has recognized no such distinction as is now attempted.  An embargo suspends many contracts and renders performance of others impossible, yet the power to enforce it has been declared constitutional.

The power to enact a law directing an embargo is one of the auxiliary powers, existing only because appropriate in time of peace to regulate commerce, or appropriate to carrying on war.  Though not conferred as a substantive power, it has not been thought to be in conflict with the Constitution, because it impairs indirectly the obligation of contracts.  That discovery calls for a new reading of the Constitution.

If, then, the legal tender acts were justly chargeable with impairing contract obligations, they would not, for that reason, be forbidden, unless a different rule is to be applied to them from that which has hitherto prevailed in the construction of other powers granted by the fundamental law.  But, as already intimated, the objection misapprehends the nature and extent of the contract obligation spoken of in the Constitution.  As in a state of civil society property of a citizen or subject is ownership, subject to the lawful demands of the sovereign, so contracts must be understood as made in reference to the possible exercise of the rightful authority of the government, and no obligation of a contract can extend to the defeat of legitimate government authority.

Closely allied to the objection we have just been considering is the argument pressed upon us that the legal tender acts were prohibited by the spirit of the Fifth Amendment, which forbids taking private property for public use without just compensation or due process of law.  That provision has always been understood as referring only to a direct appropriation, and not to consequential injuries resulting from the exercise of lawful power.  It has never been supposed to have any bearing upon or to inhibit laws that indirectly work harm and loss to individuals.  A new tariff, an embargo, a draft, or a war may inevitably bring upon individuals great losses -- may indeed render valuable property almost valueless.  They may destroy the worth of contracts.  But whoever supposed that because of this, a tariff could not be changed, or a non-intercourse act or an embargo be enacted, or a war be declared ?

By the Act of June 28, 1834, a new regulation of the weight and value of gold coin was adopted, and about six percent was taken from the weight of each dollar.  The effect of this was that all creditors were subjected to a corresponding loss.  The debts then due became solvable with six percent less gold than was required to pay them before.  The result was thus precisely what it is contended the legal tender acts worked.  But was it ever imagined this was taking private property without compensation or without due process of law ?  Was the idea ever advanced that the new regulation of gold coin was against the spirit of the Fifth Amendment ?  And has anyone in good faith avowed his belief that even a law debasing the current coin by increasing the alloy would be taking private property? It might be impolitic and unjust, but could its constitutionality be doubted ?

Other statutes have from time to time reduced the quantity of silver in silver coin without any question of their constitutionality.  It is said, however, now that the act of 1834 only brought the legal value of gold coin more nearly into correspondence with its actual value in the market or its relative value to silver.  But we do not perceive that this varies the case or diminishes its force as an illustration.  The creditor who had a thousand dollars due him on the 31st day of July, 1834 (the day before the act took effect), was entitled to a thousand dollars of coined gold of the weight and fineness of the then existing coinage.  The day after, he was entitled only to a sum six percent less in weight and in market value, or to a smaller number of silver dollars.  Yet he would have been a bold man who had asserted that because of this the obligation of the contract was impaired or that private property was taken without compensation or without due process of law.  No such assertion, so far as we know, was ever made.  Admit it was a hardship, but it is not every hardship that is unjust, much less that is unconstitutional; and certainly it would be an anomaly for us to hold an act of Congress invalid merely because we might think its provisions harsh and unjust.

We are not aware of anything else which has been advanced in support of the proposition that the legal tender acts were forbidden by either the letter or the spirit of the Constitution.  If therefore they were, what we have endeavored to show, appropriate means for legitimate ends, they were not transgressive of the authority vested in Congress.

Here we might stop, but we will notice briefly an argument presented in support of the position that the unit of money value must possess intrinsic value.  The argument is derived from assimilating the constitutional provision respecting a standard of weights and measures to that conferring the power to coin money and regulate its value.

It is said there can be no uniform standard of weights without weight, or of measure without length or space, and we are asked how anything can be made a uniform standard of value which has itself no value? This is a question foreign to the subject before us.  The legal tender acts do not attempt to make paper a standard of value.  We do not rest their validity upon the assertion that their emission is coinage, or any regulation of the value of money; nor do we assert that Congress may make anything which has no value money.  What we do assert is that Congress has power to enact that the government's promises to pay money shall be, for the time being, equivalent in value to the representative of value determined by the coinage acts, or to multiples thereof.

It is hardly correct to speak of a standard of value.  The Constitution does not speak of it.  It contemplates a standard for that which has gravity or extension; but value is an ideal thing.  The coinage acts fix its unit as a dollar; but the gold or silver thing we call a dollar is, in no sense, a standard of a dollar.  It is a representative of it.  There might never have been a piece of money of the denomination of a dollar.  There never was a pound sterling coined until 1815, if we except a few coins struck in the reign of Henry VIII, almost immediately debased, yet it has been the unit of British currency for many generations.  It is, then, a mistake to regard the legal tender acts as either fixing a standard of value or regulating money values, or making that money which has no intrinsic value.

But, without extending our remarks further, it will be seen that we hold the acts of Congress constitutional as applied to contracts made either before or after their passage.  In so holding, we overrule so much of what was decided in Hepburn v. Griswold, as ruled the acts unwarranted by the Constitution so far as they apply to contracts made before their enactment.  That case was decided by a divided Court, and by a Court having a less number of judges than the law then in existence provided this Court shall have.  These cases have been heard before a full Court, and they have received our most careful consideration.  The questions involved are constitutional questions of the most vital importance to the government and to the public at large.

We have been in the habit of treating cases involving a consideration of constitutional power differently from those which concern merely private right.  We are not accustomed to hear them in the absence of a full court if it can be avoided.  Even in cases involving only private rights, if convinced we had made a mistake, we would hear another argument and correct our error.  And it is no unprecedented thing in courts of last resort, both in this country and in England, to overrule decisions previously made.  We agree this should not be done inconsiderately, but in a case of such far-reaching consequences as the present, thoroughly convinced as we are that Congress has not transgressed its powers, we regard it as our duty so to decide and to affirm both these judgments.

Congress issued bills of credit or Treasury notes in June, 1812, February, 1813, in 1837, in 1846, in 1857, and February 25, 1862. ---[the February 25, 1862, notes were United States notes, partially legal-tender;  all the previous notes had been non-legal-tender Treasury notes, promising to pay]  There is no question in relation to the constitutional right of Congress to issue bills of credit or Treasury notes at any time in the discretion of Congress, whether in time of peace or in time of war.  ---[you are purposely confusing the two; everyone agreed that non-legal-tender Treasury notes were alright;  but they were all opposed to legal-tender US notes, even supporters of the greenbacks acknowledged that they were unconstitutional, dangerous, but at this time a necessary war measure]  Upon this subject we have the opinions of the ablest American statesmen.  We have the decision of the United States Supreme Court delivered in December, 1870, the highest judicial tribunal known in the civilized world.  This opinion was delivered five years after the war of the rebellion, and fully established the constitutional right of Congress to issue legal-tender Treasury notes.  But, in addition to all this, during peace, thirteen years after the war, we have the opinion of 177 to 35 members of this House, a majority in the Senate, and the signature of the President in May, 1878, fully committed to the legal-tender lawful money in the following language, to wit:

The bill was read.  It provides that from and after the passage of this act it shall not be lawful for the Secretary of the Treasury or other officer under him to cancel or retire any more of the United States legal-tender notes.  And when any of said notes may be redeemed or be received into the Treasury under any law from any source whatever and shall belong to the United States, they shall not be retired, cancelled or destroyed but they shall be re-issued and paid out again and kept in circulation:  Provided That nothing herein shall prohibit the cancellation and destruction of mutilated notes and the issue of other notes of like denomination in their stead, as now provided by law, and that all acts and parts of acts in conflict herewith are hereby repealed.

We now have all this Congressional legislation and these judicial decisions during the last one hundred years to fully sustain our proposition for the issuing of legal-tender Treasury notes.  It is only a question whether $250,000,000 gold and silver shall lie idle in the Treasury or be paid out to cancel bonds, stop interest, and go into the circulation as money, and whether non-interest-bearing legal tender Treasury notes shall circulate as currency and encourage industry and enterprise, build railroads, build towns and cities, pay its just proportion of taxes, give employment to labor, make happy homes and a prosperous country, or shall the people continue to pay interest, continue in serfdom and slavery to the most ingenious system of oppression ever advocated in contempt of republican institutions and the just rights of the American people.

We said, fifteen years ago, take the robber's word "except" out of the greenback and there would be no depreciation;  that it would be worth more than gold.  History proves this fact.  When thirty days previous to the time appointed for resumption an agreement was made with the banks to receive the legal tender for all purposes, equality was established, and no man wanted metal money.  The distinguished Democratic Senator from Kentucky, [Mr. Beck] in his speech upon the Sherman funding bill, said:

We are losing $2,000,000 or $3,000,000 a year by letting this large amount of money lie idle in the Treasury.  There never has been a doubt, and the country understands it now, that the greenbacks would have been as good as gold eight years ago.  If they had not been persistently refused at the custom-houses.  If they had been received in 1875, before you passed your resumption law, at the custom-houses, as they were received in 1879, they would have been as good as gold then, and there would have been no necessity for selling a dollar of the $95,500,000 of bonds, for which the Secretary paid 4½ per cent, in order to lay away gold to pay them with.

The Secretary of the Treasury, in his report for 1879-'80, volume 13, page 9, says:

No distinction has been made since that time between coin and United States notes in the collection of duties or in the payment of the principal or interest of the public debt.  The great body of coin indebtedness has been paid in United States notes at the request of creditors.  The total amount of United States notes presented for redemption from January 1 to November 1, 1879, was $11,256,678.  But little coin has been demanded on the coin liabilities of the Government during the same period, though the amount accruing exceeded $600,000,000.  Meantime coin was freely paid into the Treasury and gold bullion was deposited in the assay office and paid for in United States notes.  The aggregate gold and silver coin and bullion in the Treasury increased during that period from $167,558,734.19 to $225,133,558.72, and the net balance available for resumption increased from $133,508,804.50 to $152,7737,155.48.

In accordance with the position taken in the last annual report, United States notes have been received since January 1 last in payment of duties on imports.

Here we have the official report, the testimony of a Democratic Senator and a Republican Senator and ex-Secretary, conclusively showing that no metal money is wanted, that the full legal-tender paper is better, is preferred by creditors, and that there is no necessity for holding hundreds of millions of dollars, for years, without use, when it should stop interest.

No man wants to move tons of metal.  We have paid large sums for mintage, storage, and to force the metals into circulation.  Business men deposit large sums of gold and take silver certificates and Treasury notes in preference.  We have sold a large amount of interest-bearing bonds to purchase gold to lie idle in the Treasury.

A distinguished Senator from Delaware recently advocated such ridiculous absurdity in these words:

Now, sir, all must admit, the superior convenience paper money as compared with real money, metallic coins;  but to make such a system endurable must be absolutely and instantly convertible at the will of the holder into real money, into coin of the standard value.

The United States Supreme Court answers such absurd sophistry, in regard to metal money.  The Supreme Court says:

It is hardly correct to speak of a standard of value.  Value is an ideal thing.  The gold and silver thing we call a dollar is in no sense a standard of a dollar.  It is a representative of it.  Indeed, legal~tender Treasury notes have become the universal measure of values.  Making the notes legal-tenders gave them a new use, and it needs no argument to show that the value of things is in proportion to the uses which they may be applied.

The language of the Supreme Court settles the whole question.  This decision also determines what caused the equality of the greenback with gold.  It was making it receivable for import duties and all other purposes the same as gold.  The piling of the metals in the Treasury had nothing to do with it.  The $60,000,000 of legal-tenders first issued during the late war ---[those were non-legal-tender notes, promising to pay, on demand], when made legal tender for import duties and other purposes the same as gold, were worth more than gold until the present hour.  The legal-tender paper money is made "instantly" redeemable in all the commodities of commerce.

The sovereign law power requires all creditors to receive the same in payment for all debts.  There are no other uses for any money.  The political economist whose Senatorial vision appears to be limited to a State smaller in territory and population than many of our western Congressional districts says:

to make such a system endurable must be absolutely and instantly convertible at the will of the holder into real money, into coin of the standard value.

The distinguished Senator seems to overlook the fact that the supreme law makes the legal tenders "absolutely and instantly convertible" into all commodities without the necessity of purchasing at the great expense of hundreds of millions of dollars and holding without use any single commodity.  Such language is contempt of government, and was only used by Tories during the America Revolution and by the enemies of the Government during the late war.  It would be ludicrous, if it were not morally criminal, to deceive and unnecessarily and unjustly tax the American people.  The producers of wealth and the tax-payers have lost annually hundreds of millions of dollars because of this stupid ignorance and barbarous absurdity and unlimited fraud called "specie basis."

We have now used the legal-tender currency during the last twenty years.  It has performed all the functions of money.  The people prefer it to any other.  In 1870 the Supreme Court declared that the legal-tender Treasury notes had become the universal measure of values.  Twelve years have elapsed since that decision;  the people have become accustomed to its use;  it is worth more than gold not only in this country but in other civilized nations.  The people have learned their constitutional rights: to have a legal tender paper currency, "to regulate commerce, to establish justice, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity."

The objection to specie basis is the same as that to specie alone, the impossibility of obtaining a sufficient quantity for a currency.  If it could be kept uniform, and gradually increase in the proportion of increased wealth, commerce, population, and production, the principal objection then would be the unnecessary cost of material, its weight, and loss by wearing.  But its supply depends on the mere chance discovery of metal, and this supply failing in Europe was the chief cause of the decline and fall of the Roman Empire, and the periodical panics of all nations.  Its amount in the country at any one time depends on not only the supply from the mines, which is uncertain, but also upon the demand for foreign exportation.

Suppose we had a paper based on specie;  a war on the continent of Europe would create a demand for the specie, and the commodity on which our currency would be based might be removed.  The paper would have no adequate basis and a crisis would be the result.

This was the case in England in 1819, 1825, 1831, 1837, 1839, 1847, 1857, and 1866.  Is it not better to base our currency on something that we can keep at home;  at least something less desirable to foreign countries.  Again, a paper based on specie would increase as the specie increase and decrease with its scarcity which is the fruitful source of panics, crises, general want of confidence, bankruptcy and ruin.

The contraction in England in 1838 of $40,000,000 and in 1839 of $5,000,000 caused their great panic there of 1839 and 1840, and bankruptcies doubled and the stagnation was most disastrous to the laboring classes, who were thus thrown out of employment.  The historian Alison, speaking of this period, says, of interest on money, (volume 6, chapter 37,) "it raised by the 1st of August, 1839, 6 per cent. from 3½ per cent., which it had been the year before.  The great advance in the interest paid for money diminished the profits of trade."  A great fall in the price of all articles of commerce was ruinous to the trades and in a high degree disastrous to the laboring classes.  The bankruptcies, which had been very frequent ever since the abolition of small notes and consequent limitation of bank accommodation, became numerous in 1839 and 1840, nearly double what they had been five years before.  The number of paupers increased in frightful progression, insomuch that in the year 1840 they amounted to 1,721,000 of a population at that period not exceeding 16,000,000, showing that more than one-ninth of the whole population had become recipients of public charity.  At the same time the paupers in Ireland were 2,285,000 and in Scotland 85,000, making a total of 4,081,000 in the British Islands.

Alison, in his History of Europe, (volume 6, chapter 35,) says:

In every one of the great monetary crises which have occurred every five or six years during the past thirty years from $500,000,000 to $750,000,00 have been destroyed.

Is the retention of gold worth purchasing at such a price ?  What is the use of it if it can only be retained by making the capitalists richer and all other classes poorer ?  In the next place, the experience of Great Britain during the French war demonstrated that by means of an adequate paper currency not only can calamity be averted but the highest degree of prosperity and national glory can be attained without any gold.  To put this domestic currency on a proper footing it is indispensable that it should be issued by the government, and government only, and on the national security, and that every banker who chooses to deal in notes should not be permitted to usurp the king's prerogative and issue the current coin of the realm.  And it may safely be affirmed that if the requisite change is not made the nation will continue to be visited every four or five years by a periodical calamity which will destroy all the fruits of former prosperity.

A specie-basis system is to the nation what the inhuman military laws of past ages were to the poor culprit who was condemned to receive his thousand lashes, brought out at successive times to receive a hundred, then wait for the wounds to heal before receiving the next round.

Speaking of contraction of the currency in the Roman Empire, Allison, in his History of Europe, volume 2, page 381, says;

The supplies of specie for the Old World became inadequate to the increasing wants of its populations when the power of the emperors had given lasting internal peace to its hundred and twenty millions of inhabitants.  The mines of Spain and Greece, from which the chief supplies were obtained at that period, were worked out or became unworkable from the exactions of the emperors;  and so great was the dearth of the precious metals which thence ensured that the treasure in circulation in the empire, which in the time of Augustus (63bc-14ad) amounted to $1,800,000,000, had sunk in that of Justinian (483-565) to $400,000,000;  and the golden aureus, which in the days of the Antonines (138-180) weighed 118 grains, had come, in the fifth century, to weigh only 68, though it was only taken in discharge of debts and taxes at its original and standard value.  As a necessary consequence of so prodigious a contraction of the currency, without any proportional diminution in the numbers or transaction of mankind, debts and taxes, which were all measured in the gold standard, became so overwhelming that the national industry was ruined;  agriculture disappeared, and was succeeded by pasturage in the fields;  the great cities were all fed from Egypt and Lybia;  the revenue became irrecoverable;  the legions dwindled into cohorts, the cohorts into companies;  and the six hundred thousand men who guarded the frontiers of the empire in the time of Augustus had sunk to one hundred and fifty thousand in that of Justinian, a force wholly inadequate to its defense.

From the report of the silver commission, second session fourty-fourth Congress, page 49, we get the following:

At the Christian era the metallic money of the Roman empire amounted to $1,800,000,000. By the end of the fifteenth century it had shrunk to less than $200,000,000. During this period a most extraordinary and baleful change took place in the condition of the world. Population dwindled, and commerce, arts, wealth, and freedom all disappeared. The people were reduced by poverty and misery to the most degraded conditions of serfdom and slavery. The disintegration of society was almost complete. The conditions of life were so hard that individual selfishness was the only thing consistent with the instinct of self-preservation. All public spirit, all generous emotions, all the noble aspirations of man shriveled and disappeared as the volume of money shrunk and as prices fell.

History records no such disastrous transition as that from the Roman empire to the dark ages. Various explanations have been given of this entire breaking down of the framework of society, but it was certainly coincident with the shrinkage in the volume of money, which was also without historical parallel.  The crumbling of institutions kept even step and pace with the shrinkage in the stock of money and the falling of prices. All other attendant circumstances than these last have occurred in other historical periods unaccompanied and unfollowed by any such mighty disasters.

It is a suggestive coincidence that the first glimmer of light only came with the invention of bills of exchange and paper substitutes, through which the scanty stock of the precious metals was increased in efficiency. But not less than the energizing influence of Potosi and all the argosies of treasure from the new world were needed to arouse the old world from its comatose sleep, to quicken the torpid limbs of industry, and to plume the leaden wings of commerce.  It needed the heroic treatment of rising prices to enable society to reunite its shattered links, to shake off the shackles of feudalism, to relight and uplift the almost extinguished torch of civilization. That the disasters of the dark ages were caused by decreasing money and falling prices, and that the recovery therefrom and the comparative prosperity which followed the discovery of America were due to an increasing supply of the precious metals and rising prices, will not seem surprising or unreasonable when the noble functions of money are considered.

Money is the great instrument of association, the very fiber of social organism, the vitalizing force of industry, the protoplasm of civilization, and as essential to its existence as oxygen is to animal life. Without money civilization could not have had a beginning; with a diminishing supply it must languish, and, unless relieved, finally perish.  Symptoms of disaster, similar to those which befell society during the dark ages, were observable on every hand during the first half of this century.

In 1809 the revolutionary war between Spain and her American colonies broke out. These troubles resulted in a great diminution of the production of the precious metals, which was quickly indicated by a fall in general prices.

As already stated in this report, it is estimated that the purchasing power of the precious metals increased between 1809 and 1848 fully 145 per cent., or, in other words, the general range of prices was 60 per cent. lower in 1848 than it was in 1809.  During this period there was no general demonetization of either metal and no important fluctuation in the relative value of the metals, and the supply was sufficient to keep their stock good against losses by accident and abrasion.  But it was insufficient to keep the stock up to the proper correspondence with the increasing demand of advancing populations.  The world has rarely passed through a more gloomy period than this one.  Again do we find falling prices and misery and destitution inseparable companions.  The poverty distress of the industrial masses were intense and universal, and since the discovery of the mines of America without a parallel.

In England the sufferings of the people found expression in demands upon Parliament, for relief, in bread riots and in immense chartist demonstrations. The military arm of the nation had to be strengthened to prevent the all-pervading discontent from ripening into open revolt.  On the Continent the fires of revolution smoldered everywhere and blazed out at many points, threatening the overthrow of states and the subversion of social institutions.  Wherever and whenever the mutterings of discontent were hushed by the fear of increased standing armies, the foundation of society were honeycombed by powerful secret political associations.

The cause at work to produce this state of things was so subtle, and its advances so silent, that the masses were entirely ignorant of its nature. They had come to regard money as an institution fixed and immovable in value, and when prices of property and wages of labor fell, they charged the fault not to the money, but to property and the employer.  They were taught that the mischief was the result of over-production. Never having observed that over-production was complained of only when the money stock was decreasing, their prejudices were aroused against labor-saving machinery.  They were angered at capital because it either declined altogether to embark in industrial enterprises, or would only embark in them upon the condition of employing labor at the most scanty remuneration.  They forgot that falling prices compelled capital to avoid such enterprises on any other conditions, and, for the most part, to avoid them entirely. They did not comprehend that money in shrinking volume was the prolific parent of enforced idleness and poverty, and that falling prices divorced money, capital, and labor; but they none the less felt the paralyzing pressure of the shrinking metallic shroud that was closing around industry.

The increased yield of the Russian gold fields in 1846 gave some relief and served as a parachute to the fall in prices, which might otherwise have resulted in a great catastrophe.  But the enormous metallic supplies of California and Australia were all needed to give substantial and adequate relief.  Great as these supplies were, their influence in raising prices was moderated and soon entirely arrested by the increasing populations and commerce which followed them.  In the twenty-five years between 1850 and 1876 the money stock of the world was more than doubled, and yet at no time during this period was the genera;l level of prices raised more than 18 per cent. above the general level in 1848.  A comparison of this effect of an increasing volume of money after 1848 with the effect of a decreasing volume between 1809 and 1848 strikingly illustrates how largely different in degree is the influence upon prices of an increasing or decreasing volume of money.  The decrease of the yield of the mines since about 1865, while population and commerce have been advancing, has already produced unmistakable symptoms of the same general distrust, non-employment of labor, and political and social disquiet, which have characterized all former periods of shrinking money.

It is a fact well established by the history of nations, that an increase of currency, well founded, ---[on what?] always has and will cause prosperity for the laboring, manufacturing, mercantile, and producing industries of the country.  And it is equally true that a contraction of the currency always has and always will cause high rates of interest and prostration of business;  thereby causing universal bankruptcy, pauperism, ignorance and crime, human suffering and hard times.

During the panic of 1793, in England, William Pitt had the paper currency increased $25,000,000.  It stopped the panic and gave prosperity to the country.  The drain of the money from England to carry on her Napoleonic wars threatened to ruin the kingdom, and on February 25, 1797, the Parliament of England authorized the Bank of England to suspend specie payments and to issue its bills without limit, and as legal tenders, and pursuant to this law the increase of $50,000,000, stayed the panic and gave prosperity.

During the same war period, Napoleon returned France to silver coins;  paid for war expenses; paid for domestic improvements;  and left money in the treasury.

In 1811, when there was scarcely a metallic sovereign left in England, and 30 per cent. was paid to obtain coin to carry on its peninsular war, it again increased its legal-tender paper currency $75,000,000.  This increase of currency to about $135,000,000 in 1815 revived all the industries of the country.  Alison in his History of Europe speaks of the unparalleled prosperity it caused.  This currency was increased on the suspension of specie again in 1817 and 1818, and the paper currency in England reached $241,390,350.  Of this period the historian speaks as follows:

The paper circulation of Great Britain had increased during the drain of the metals and compensated for their want.  In 1818 the currency reached $240,000,000 in England alone, a larger amount than in any previous year of the war.  Hence the prosperity in this country which coexisted with the most serious pressure and distress on the Continent. ---Alison's History of Europe, volume 1, pages 395-397. ---[this historian conveniently forgets to mention that it was England that started that war against Napoleon, against the united States]

The great paper currency guaranteed by all the allied powers issued so plentifully during 1813 and 1814, and which had circulated as cash from the banks of the Rhine to the Wall of China, gave great prosperity to the whole country until 1817 and 1818, the period of contraction on the Continent:

The hard times on the Continent during 1817 and 1818, caused by contraction of the currency, during the same period that England was enjoying prosperity caused by inflation of the currency, is another of the many lessons of history showing the power of government to cause prosperity by inflation and to cause hard times by contraction.

Alison, in his History of Europe, says:

The contraction of the currency in England in 1819 to 1826 caused fearful suffering.  It was a woeful spectacle to see the streets of Manchester and the chief towns in its vicinity filled with vast crowds, sometimes 10,000 in number, whose wan visages and lean figures but too clearly told the tale of their sufferings, snatching their food from bakers' shops.

The legislation causing a contraction of the currency reduced the wages of laboring-men one-half.  Yet the party in power declared that the hard times in England was caused by extravagant speculation.  The historian says:

This affords an example of the case with which a powerful party can succeed in deluding the public mind and conducting a nation amidst universal applause to the very measures most destructive to its prosperity.

That English historian continues:

The British Empire in the whole of 1818 and commencement of 1819 was beginning to taste the fruits of peace and prosperity;  and industry revived, and supported by a currency at once adequate and duly limited, was flourishing in all its branches, and daily discovering new channels of profit and enterprise, at the very time when the scarcity of money on the Continent was involving all classes in unheard of distress.

But this flattering prospect was of short duration.  Great Britain was soon doomed to experience in all its bitterness the disastrous effects of an ill-judged act of legislation, to prostrate all of her industries.  Does not wise or unwise legislation make or destroy a nation's prosperity ?  At that period England required an increased currency to continue her prosperity, but the Parliament of England in 1819 required the Bank of England to resume specie payments.  The industries of the nation, then so prosperous, were speedily congealed like the flowing stream by the severity of an Arctic winter.  The circulation fell $35,000,000 during 1819, and "distrust and discouragement was felt in every branch of industry."  In the next two years they contracted the circulation $75,000,000 more, and the historian paints the disastrous condition and fearful suffering of the people of England.

Between 1818 and 1821 the paper of England was contracted from $240,000,000 to $150,000,000, or $90,000,000, and the exports and imports lessened, as all business declined and laboring-men could find no employment.  The following tables from Alison's History of Europe, volume 2, page 399-400, will show the decrease of currency from 1818 to 1822, (Tooke on Prices, 2, 129), the depressed condition of industries by the falling off exports, and the destitution of the people by the falling off imports:

The gentleman from New York [Mr. Hewitt] says:

We all recollect such periods in our history, and know what depression, distress, and general disaster such a surplus of products not needed for consumption is sure to entail;  our very abundance becomes the source of our misery.

The most skillful Democratic and Republican bank and bullion doctors, after many years of legislative experience and philosophical research, have at last solved the great problem, and philanthropically donate to the world their most profound conclusions.

We give the explanation of the cause of hard times and good times, as taken from the speeches of two distinguished party leaders.  From these speeches we learn that the American people suffered during many years because of "the delirium of an inconvertible paper currency," and because of the great "disaster of over-production."  The people are informed that they suffered hunger because they had too much food;  that they were ragged and bare-footed because they had too many boots and clothes;  that all industries were paralyzed and the land filled with tramps because we had a surplus of products and too much "inconvertible paper currency."  If the victimized people should happen to discover that they were not made "miserable" by a "surplus of products" and too much "bad money," (that is, money that does not pay toll to money-kings,) but that they were made to suffer hard times because of special laws made in the interest of capitalists, the people might be willing to retire such law-makers, as these statesmen have provided for retiring our Army officers on large salaries after they are sixty-two years of age.

That the people are made "miserable" by "a surplus of products," the "great disaster of over-production."  Hence the legitimate conclusion of both political parties, that the laboring classes and producers of wealth are made happy and prosperous by making laws granting special privileges to large manufacturers for high protective tariffs;  to railroad companies unlimited charges;  bullionists and bankers high rates of interest, in order to remove the great burden of "bad money" and "surplus products" from the people.  That the people may not be made "miserable" with "surplus products" and too much "cheap and cheating money," as the gentleman from New York calls it, $300,000,000 will be kept idle and the people compelled to pay interest upon bonds and to pay high tariffs to keep them from being afflicted by another great "disaster of overproduction."  The policy of these political leaders appears to be to permit the capitalists of Wall street to take a large proportion of those "surplus products" (the honest earnings of the laboring classes) and allow a few millionaires only to suffer the "misery" caused by the "great disaster of over-production."

In regard to "inconvertible paper currency," General Grant says, in his message of December 1, 1873:

The experience of the present panic has proven that the currency of the country, based as it is upon the credit of the country is the best that has ever been devised.  Usually in times of such trials currency has become worthless, or so much depreciated in value as to inflate the value of all the necessities of life as compared with the currency.  Every one holding it has been anxious to dispose of it on any terms.  Now we witness the reverse.  Holders of currency hoard it as they did gold in former experiences of alike nature.

The gentleman from New York will please notice this testimony.  "Inconvertible" paper money in 1873.  No specie basis.  Paper money, "based as it is upon the credit of the country, is the best that has ever been devised."  This was before the enactment of a law for specie resumption.  This is the kind of "bad money" together with "surplus products" that caused hard times, according to the latest teachings of modern Democracy.

We would call the attention of the gentleman from New York to the language of the political economist, Colwell, page 101.  He says:

Among savages the precious metals are, no doubt, directly compared with the articles for which they are bartered.  With them it is literally so much of one thing for so much of another.  It is not so in civilized life, where commodities are very seldom sold with any thought of payment being exacted in gold or silver.

Civilization settles the question that "money is that which the law requires the creditor to receive in payment for debts."

We see that the legal tender, fully sustained by the Supreme Court, has saved the expense of purchasing bullion, $346,681,016, and has saved in simple interest upon the 5 per cent. bonds to purchase bullion, in twenty years, $346,681,016, an aggregate saving to the people of $693,362,032.  If we had used bank paper, $350,000,000, based upon bonds at 5 per cent., the cost in interest upon bonds would have been $350,000,000.

If we had used gold the cost of bullion would have been $350,000,000, and the simple interest at 5 per cent. upon the bonds to purchase the bullion during twenty years, $350,000,000 more, making an aggregate cost of $700,000,000.

If we had used standard silver dollars costing eighty-eight cents each for the bullion, saving twelve cents on each dollar by "fiat," the $350,000,000 of money would have cost the people $308,000,000 for the bullion and $308,000,000 more for the interest upon bonds during the twenty years, making an aggregate of $616,000,000 for that amount of currency during twenty years.  This would have saved to the people $84,000,000 by the use of fiat silver;  $66,000,000 of silver certificates, redeemable only in this "cheap and cheating fiat" silver money are in circulation as money;  $38,000,000 of gold coin have been deposited in exchange for such silver certificates, business men preferring the certificates based on this "fiat, cheating" money to gold coins.  According to the report of the Director of the Mint, page 36, the people gained by "fiat" profits on standard and silver dollars come during the year previous to June 30, 1881, the sum of $3,346,949.99, and "fiat" profits on the manufacture of minor coins $274,423.73.

Would not bullion certificates, which are preferred to either coin, and which would save the expense of coinage, and also the loss by wear or abrasion, be better for the people than either gold or silver coins ?  The people prefer the legal-tender greenback currency which pays no tolls to bullionists or bankers.  The idea of any necessity for commodity value in money, belongs to an age of barter, and not to an age of civilization.
---[unfortunately you learned this wisdom from Daniel Webster, attorney to the Bank of the United States, fervent advocate of the use of bank paper instead of coin......]
The people will see what kind of money pays them best, that which gives freedom and prosperity, or that which makes them serfs and slaves to a capitalistic aristocracy.

It is morally criminal to place the producers of wealth at the mercy of capitalists by special legislation, as was done in this country during a period of years from 1865 to 1878, contracting the currency hundreds of millions of dollars under the false pretense of reaching a specie basis.  The American people hold those specie-basis legislators responsible for the financial crisis of 1873, for the hard times during ten years previous to 1878.  The people hold these men responsible for the sacrificing of the homes of hundreds of thousands of industrious and innocent people and for filling the land with thousands of bankrupts, paupers, and criminals.

The people hold those legislators responsible for the unjust laws which caused 3,000,000 able-bodied men to be thrown out of employment and forced to beg for work and for bread during those long and fearful years of suffering.  The silver commission estimated the number of tramps at 3,000,000.  If those men could have been employed at $1 each per day, three hundred working days each year, $900,000,000 per year, equal to $7,200,000,000 in eight years, a sum of money would have been realized sufficient to purchase a country 1,000 miles in width and 1,125 miles in length, at $10 per acre.

Those legislators should be held responsible for railroad strikes and destruction of property, for the suffering and starvation of thousands of men, women, and children.  Those specie-basis legislators should be held responsible for unjust laws designed to make the rich richer and the poor poorer.  They should be held responsible for the thousands of disheartened bankrupts and paupers who fill the graves of suicides.  No language can express the just indignation of a long-suffering people, through a period of many years of hard times, caused by a series of special laws designed for special purposes.

The large increase of money in the United States since 1878, as shown by the Comptroller's report, has given new vitality to all the industries of the country.  As contraction of the volume of money caused hard times, so inflation gives us prosperity.  This is the simple repetition of the history of all nations in all ages.  Those millions of unemployed and hungry men who were scandalized and imprisoned, an who were put in chain-gangs as tramps, by those who had robbed and starved them through unjust legislation, have been awakened to new life and hope as honest and industrious Americans.  During the year 1880 those industrious people built 8,174 miles of new lines of railroad, and in 1881 an additional amount of 8,242 miles of road, and all other enterprises have been developed in proportion.  Should not those heartless specie-basis law-makers be held responsible for the contraction of the currency during ten years ?  With the pages of history open to every American child, shall those men be allowed to plead ignorance in justification of such national wrong ?

When we read of the James brothers, of the outlaws of the mountains wrecking occasionally a railroad train, we are struck with horror at such human depravity.  But how much more alarming are the consequences when all of our industries are paralyzed, a whole nation prostrated in fearful gloom during a period of years by a series of premeditated unjust laws ?  Can there be any just retribution for the dwarfed childhood and crushed manhood caused by this specie basis idolatry ?

A few years since chattel slavery was the corner-stone of the American Republic.  To doubt the divinity of this institution was a heresy not to be tolerated.  To-day the Rothschilds and their agents in Wall street dictate reverence to their gods of gold, the limitation of commerce and American civilization to their system of paganism, by means of which the nations have been cursed and enslaved.  A grand army of 500,000 brave, conscientious, and intelligent voters, with the flags of Jefferson and Franklin, are moving fearlessly and rapidly upon the enemy's works.  We say to those specie-basis conspirators, who stopped the growth and progress of the American States during a period of many years, and caused hard times in spite of God's sunshine and rain and bountiful harvests-- the past is yours, but the future is ours.

In behalf of the American people, who have confidence in a government by the people and for the people, we demand that the people's currency, unjustly taken from the people and destroyed, or put into an interest-bearing debt, shall be restored to the circulation as currency instead of drawing interest in bonds or stored at great expense for safes and watchmen lying idle in the Treasury, while the people are compelled to pay interest upon hundreds of millions of dollars of unnecessary bonds.

We have shown by the testimony of the Secretary of the Treasury that the creditors prefer the legal-tender paper to gold or silver.  Why not let them have it and stop interest ?  We had an immigration equal to 593,703 people during the year 1880, and 720,045 during the year 1881.  We have reason to expect even a larger immigration in future years.  We demand an increase of the currency equal to the increase of population and the increasing demands of business.

We question the policy, the wisdom of Government purchasing hundreds of millions of dollars' worth of gold, silver, iron, lead, wheat, cattle, or any other commodity and holding it without use at great expense to strengthen the credit of our Government.  The producers of wealth, the tax-payers, intelligent Americans, students of Jefferson and Franklin, want no such unjust legislation in the interest of money speculators, bankers, usurers, Shylocks, and tories.

History proves that gold was never the money of a people struggling for freedom.  The gold of King George paid armies to butcher, scalp, murder, and burn, during seven long years.  Their bayonets were driven from this land without gold.  When a few years since English pirate-ships preyed upon our commerce, they were driven from the seas without gold.  During the fearful trials of the late war our soldiers were paid without gold.