The farmers of the Middle West rallied to the calls of liberal men and Unionists everywhere. They fought Southern farmers with desperate valor, Southern farmers no less heroic in their fight for the privilege of holding slaves. Eastern men likewise engaged in the struggle for national unity, fighting the South with one hand, tending their mills with the other. A year passed and there was no glimpse of the end. A second year came and went and Abraham Lincoln, peering doubtfully into the future for a decision, said: "this fiery trial will light us down in honor or dishonor to the latest generation. We shall nobly save or meanly lose the last best hope of earth." A crucial moment in American history-the Union in grave need of help.

A little before the Civil War broke, a Virginian farmer turned inventor and went to Chicago; before 1861 he was selling thousands of reapers. It was Cyrus McCormick, bitterly opposed to the war. But his machines enabled old men, women and boys to harvest more wheat per year than had ever been harvested before. There were other inventors who made drills and mowers, all lending a hand to the farmers whose sons were at the front, the red caldron of war taking more wheat and pork than the Napoleonic wars had taken. Once more the price of farm products mounted. Wheat sold for a dollar and then two dollars a bushel. Beef doubled in value; and the wool from the increasing herds of sheep all over the Middle West rose to eighty cents a pound. War meant prosperity to farmers, as it had meant before. But to war was added

a strange European demand. There was a failure, or near failure, of the wheat crops of England in 1861, 1862 and 1863; and the price of flour once more reached twelve dollars a barrel, farmers becoming as rich as they had been in Washington's day. The farmers were not alone in their prosperity.

Industrial men in the East, after a moment of anxious doubt, turned their cotton-mills into manufacturies of woolen cloths at high prices; for shoes and firearms and blankets other mill men received prices which yielded profits of twenty to fifty per per cent cent a year. European industrialists undertook to assist the great cause at a profit by offering clothing, arms and munitions. Eastern industrialists did not like the idea. They procured the passage of a protectionist tariff law in 1861 which alienated much needed support in Europe. The industrialists risked the ruin of their country to save themselves from European competition. In 1864 Congress, after some demur from the President, raised the tariff schedules to the dangerous level of 1828. But Lincoln insisted upon an income tax and a direct tax upon manufactured goods, measures designed to bring into the treasury some of the returns lost in the high schedules. It was a bargain; but the East had now its privilege, a practical monopoly of the expanding American market. It was a situation much like that of 1763 to 1776 in England against which the Americans of that day revolted. If the Southerners lost, the great privilege of slavery would be gone; the industrial privilege, if unbroken, would take its place. To retain

that privilege became at once major object of Eastern politics.

While the industrialists made new fortunes overnight, the finances of the country were organized on a national basis; an association of national banks took control of the money and credit of the country in a way which Jefferson had feared, and which Jackson had stirred the masses of the people to resist to the bitter end. The new banks procured protection against competition in the law of 1863; they might issue banknotes for national circulation; and they were hardly taxed at all. It was a second great roof under which financiers might operate and, if they were wise, make themselves fairly secure against the setbacks and hard vicissitudes of other men. Thus in the hope of winning the war and of destroying the great privilege of the South, two new privileges came into existence, the industrialists holding competition at a distance by the help of the nation and the nationalbankers with the immemorial advantages of bankers. Next to these, though not so secure, were the rising railroad systems which took upon themselves to say what rates the public must pay for the transportation so necessary to win the war. It was a day of great though halfobserved change, five hundred millionaires in 1864 where there had been one in 1860.

But the "last best hope of earth" was safe at last. The South, so long a storm center, so filled with able men who sneered at democracy, was an inseparable part of the Uniona thousand burying-grounds white with the markers of dead soldiers, the South as poor and distraught as it

had once been rich and powerful, its great leaders making ready to reënter the councils of the nation.

The West was still prosperous, its wheat and flour selling at fabulous prices, pigs and beef and wool in urgent demand, hundreds of thousands of returning soldiers ready to grasp the plow and have a share in the marvelous money-making. Amazing prosperity; though there was a national debt of three billions, a third of all the property of the North as assessed in 1860, such a debt as baffled the wits of the Fathers in 1789; and, moreover, every State and city and county, North and South, was similarly in debt. The farmers who had fought the war and been paid in paper money had come home to pay themselves for fighting, pay and make the Southerners pay a full third of it. (Nine tenths of the debt having drifted before 1868, into Philadelphia, New York and Boston.) Pay in gold?

If times continued good. But times did not remain good. A big crop was planted. The mills turned out great quantities of goods, drills, reapers and new corn-planters for the farmers; new machines in shoe factories and new looms for the making of cloths. The first crop of wheat sold at $1.50 a bushel; in 1880 wheat sold at $1.00, and in 1894 it had fallen to forty-nine cents a bushel! Cotton was worth thirty-one cents a pound in 1866; in 1878 ten cents; and in 1894 six cents. Pork and beef and wool were drugs on the market. It was deflation for the farmers again. And the farmers, poor students of the intricacies of economic life, knew not what to do. They applied the principle of mass

production which industrial men now seek to apply on a world scale. They opened new lands all the way to the Pacific; they made use of the new machines which enabled one man to do the work formerly done by five men: they raised wheat and corn, steers and hogs everywhere, and flooded the markets of Europe with low-priced products. Thus they ruined the farmers of England and Germany, peasant farmers who sent their sons and went themselves into the mills of their countries to manufacture cheap industrial goods which men vainly hoped to sell in the United States at low prices. What farmers did not sell in Europe, they sent to those wonderful markets in American cities, the railroads taking such toll as they thought fit to take. The price of farm products was generally fixed by the city buyers, never by the farmers, and it was rarely as high as the European markets paid. A shipment of lambs sometimes failed to pay the cost of transportation and commission charges; a carload of apples hardly netted twenty-five cents a barrel to the farmer. Beeves brought into the Chicago markets rarely yielded a profit of two per cent to the shipper. Flooding the European market and ruining European farmers brought little gain; supplying the domestic market often brought nothing at all; the farmer was angry, sometimes desperate. How did things work out with industrial and financial men?

The workers in the mills, the petit traders, the clerks and the bookkeepers returned like others to their tasks. In the flush months that followed the surrender of Lee, every one found employment, the tide of

immigration from Europe reaching into the hundreds of thousands, thus increasing the market for industrial goods. But in a little while prices began to fall. Pig-iron dropped from $46 a ton in 1866 to $17 in 1878 and $13 in 1896, almost as bad as cotton or grain. But coal, a constituent of pig-iron, also fell in price from $10 a ton to $2.75. A suit of clothes, a drill, a plow or a pair of shoes sold at reduced prices in every country store; the decline was, however, ten or twenty per cent, not a half or two thirds of its former value. Industry simply discharged workers, ran on half time or closed doors. A railroad company or a bank, indispensable public utilities, ceased to declare dividends and sometimes reduced wages to lower scales. They did not operate for the mere "board and housing" to which the farmers were reduced. The hard times, the great debts and the natural sectional hatreds gave rise to commotions, acrimonious political campaigns. Was there no way to equalize the burdens of economic life?

21

George Pendleton, "gentleman George," of Ohio proposed a remedy: pay the national debt in paper; reduce the tariff by half; and bring the railroads and banks under strict Federal control. It was the Ohio idea and John Sherman, Republican, of Ohio, as well as Thomas A. Hendricks, Democrat, of Indiana favored the program. It was a new form of Hamilton's scaling of the debts of his day, of Madison's plan of an even more drastic scaling; half the States in the country had either repudiated or scaled debts, and Pennsylvania was paying her creditors in green

backs. The farmers seized upon the Ohio idea; the Southerners were not averse to lowering the capital value of a debt incurred in their own undoing. From all the evidence available two thirds of the people favored this scheme.

When the danger of such drastic, if fairly equitable, measures became imminent so soon after 1865, Lincoln's plan of reconstruction, which would have granted Southern representatives their seats and votes in Congress, was promptly denounced. Its acceptance would have assured the adoption of Pendleton's program. The Southerners, now as hasty to get into Congress as they had been eager to get out of it six years before, longed to take their seats and take a hand in the reordering of the disordered life of the country. Thaddeus Stevens, Zachariah Chandler and Charles Sumner, accepted leaders in the national life, slowly solidified the Eastern communities and kept Southerners out of Congress for the better part of ten years. It was the first move of the industrial men to fortify their tariff privilege. That meant an economic war between the East and the West, the old ally, the South, outside of Congress. And when Westerners pressed for a reduction of the war tariff in 1868, the Easterners replied by raising some of the rates. When the Westerners demanded the payment of the debt in greenbacks, the Easterners replied by formal resolutions that all debts, whether contracted in paper or gold, must be paid in gold. When the leaders of the Western opposition to railroad exactions set up demands (1868-76) for State and finally national control of all interstate trans

portation, the leaders of the East would have none of it.

21

The first great national contest upon the Ohio idea illustrates the tactics of the East for decades to follow. The Democratic convention of 1868 met in New York City. The delegates from the West and South came on to make a finish of the task and nominate Pendleton. Tammany Hall was the host of the convention, ex-Governor Seymour its president. The Tammany men and Seymour managed by manipulation of the twothirds rule to defeat the majority; then they nominated an Eastern candidate, having divided the Westerners; and General Grant, the Republican leader, easily became President of the United States. The Southerners still held out of Congress till tariff and finance were in "safe hands." Instead of ameliorating the inequalities due to the tariff, the rates were left as they stood or they were raised-farmers selling their products in world markets and buying their clothes, their implements and some of their foodstuffs in markets protected by tariffs which held prices at or near wartime levels. At the same time the income and the direct tax on industrial goods were repealed: the East thus held practically all the benefits of wartime legislation and refused to pay the taxes which had been laid to equalize the benefits which urgent war had dictated. It was war; and all is fair in war.

But there was anger, resentment and violent protest, as there had been after 1828. In Ohio many battles were fought upon the closest of margins; in Indiana there was perpetual political war; in Iowa there were

many young leaders like William Allison who cried every day and every year, "Down with monopoly and pools and privilege." There was no remedy save through organization-politics. Samuel J. Tilden rose in New York in 1876 and promised to remedy the tariff privilege. The payment of debts in greenbacks he thought no relief at all-the United States being already a part of the European financial complex. The Westerners accepted him doubtingly, but Southerners voted for him with enthusiasm a great reform. But Samuel J. Randall, Pennsylvania protectionist then in the Speaker's chair of the House of Representatives, managed a deal which after a long struggle seated a Republican protectionist in the White House!

Richard Bland of Missouri, a Democrat, and William Allison of Iowa, a Republican, irreconcilable insurgents, managed a bipartizan combination of South and West in 1878 and gave to the farmers whatever relief was to be had from the issue of great quantities of silver coin-a modified form of cheap money so often tried in colonial and later American social conflicts. In 1884 Grover Cleveland of the western end of New York rose, like Tilden, and tried to weaken the hold of industry upon the Government. He failed, but he offered again in 1892 and received a great majority of the votes of the country. His tariff reform was defeated by Arthur Pue Gorman, a Maryland Democratic chief who, like Randall, was a better advocate of privilege than leader of a reform party. Cleveland went out of office without a party. But the farmers, at the worst of their long post-war deflation,

were frantic. Revolution was in the

air.

A young, half-educated, handsome Nebraskan was a member of the House of Representatives. He entered upon a crusade on behalf of Western farmers. He stirred Southern voters to a great enthusiasm; ancient leaders like Vance of North Carolina and Harris of Tennessee, hustled off the national stage. West and South men talked less of the Civil War and more of the strange outcome of Lincoln's war for democracy. The new Populist party was about to join the Democrats; a wing of the Republican party bolted at St. Louis in 1896 and made ready to support the Boy Orator of the Platte, while John Hay, gentle aristocrat in Cleveland, talked of the dangers of lamp-posts to conservative chiefs in case of a farmer victory. Bryan appeared at the doors of the national Democratic convention at Chicago. Handsome and resourceful, he managed to have himself seated against the will of the old order. He made a speech not unlike that of Patrick Henry in 1775, calling for war upon all the privileges of the time: a radical readjustment of the tariff; prompt Federal control of all the great railways, already combined into powerful systems and allied to the national banks; positive outlawry of the industrial trusts, flourishing under the ægis of the war tariff; the issue of silver money in quantities limited only by the supply of the silver mines; and, like many another American politician, he declared war upon the "tyrant Great Britain, forcing her gold system of finance into the free countries of the world." The convention adopted the young orator's