"4. The Union to pay four hundred million dollars ($400,000,000), in five per cent. United States stock, to the late Slave States, loyal and secession alike, to be apportioned pro rata, according to their slave population respectively, by the census of 1860, in compensation for the losses of their loyal citizens by the abolition of slavery. Each State to be entitled to its quota upon the ratification by its legislature of this adjustment. The bonds to be at the absolute disposal of the legislature aforesaid.

5. The said Slave States to be entitled henceforth to representation in the House on the basis of their total, instead of their Federal population, the whole now being free.

"6. A national convention, to be assembled as soon as may be, to ratify this adjustment, and make such changes in the Constitution as may be deemed advisable.

"Mr. President, I fear you do not realize how intently the people desire any peace consistent with the national integrity and honor, and how joyously they would hail its achievement, and bless its authors. With United States stock worth but forty cents in gold per dollar, and drafting about to commence on the third million of Union soldiers, can this be wondered at?

"I do not say that a just peace is now attainable, though I believe it to be so. But I do say that a frank offer by you to the insurgents of terms which the impartial say ought to be accepted, will, at the worst, prove an immense and sorely needed advantage to the national cause. It may save us from a Northern insurrection.

"Yours truly,

"Hon. A. LINCOLN, President, Washington, D. C.

HORACE GREELEY.

"P. S.-Even though it should be deemed unadvisable to make an offer of terms to the rebels, I insist that in any possible case it is desirable that any offer they may be disposed to make should be received, and either accepted or rejected. I beg you to invite those now at Niagara to exhibit their credentials and submit their ultimatum.

"H. G."

A few days later, Mr. Greeley was informed by George N. Sanders, a noted rebel agent in Canada, that Clement C. Clay, of Alabama, Professor J. P. Holcombe, of Virginia, and himself, were willing to go at once to Washington, provided they could be assured of their personal safety. To this Mr. Greeley replied as follows:

"NIAGARA FALLS, N. Y., July 17, 1864. "GENTLEMEN:-I am informed that you are duly accredited from Richmond as the bearers of propositions looking to the establishment of peace, that you desire to visit Washington in the fulfilment of your mission, and that you further desire that Mr. George N. Sanders shall accompany you. If my information be thus far substantially correct, I am authorized by the President of the United States to tender you his safeconduct on the journey proposed, and to accompany you at the earliest time that will be agreeable to you.

"I have the honor to be, gentlemen, yours,

HORACE GREELEY.

"To Messrs. CLEMENT C. CLAY, JACOB THOMPSON, JAMES P. HOLCOMBE, Clifton House, C. W."

Clay and Holcombe replied on the succeeding day tnat tne safeconduct of the President had been tendered to them under some misapprehensions of facts, since they had not been accredited to him from Richmond as the bearers of propositions looking to the establishment of peace. "We are, however," they added, "in the confidential employment of our Government, and are entirely familiar with its wishes and opinions on that subject; and we feel authorized to declare that, if the circumstances disclosed in this correspondence were communicated to Richmond, we would be at once invested with the authority to which your letter refers; or other gentlemen, clothed with full

HISTORY OF THE GREAT REBELLION.

powers, would be immediately sent to Washington, with a view of hastening a consummation so much to be desired, and terminating at the earliest possible moment the calamities of the war." Under these circumstances, Mr. Greeley telegraphed to Washington for further instructions, and received on the same day the following memorandum:

"To whom it may concern:

"EXECUTIVE MANSION, WASHINGTON, July 18, 1864.

"Any proposition which embraces the restoration of peace, the integrity of the whole Union, and the abandonment of slavery, and which comes by and with an authority that can control the armies now at war against the United States, will be received and considered by the Executive Government of the United States, and will be met by liberal terms, on substantial and collateral points, and the bearer or bearers thereof shall have safe-conduct both ways

(Signed)

"ABRAHAM LINCOLN."

This, in view of the temper and pretensions of the South, was practically a bar to further proceedings, and was so considered by the rebel agents. In their final reply to Mr. Greeley, after quoting the President's memorandum, they proceed as follows:

"The application to which we refer was elicited by your letter of the 17th instant, in which you inform Mr. Jacob Thompson and ourselves that you were authorized by the President of the United States to tender us his safe-conduct on the hypothesis that we were duly accredited from Richmond as bearers of propositions looking to the establishment of peace,' and desired a visit to Washington in the fulfilment of this mission. This assertion, to which we then gave, and still do, entire credence, was accepted by us as the evidence of an unexpected but most gratifying change in the policy of the President, a change which we felt authorized to hope might terminate in the conclusion of a peace mutually just, honorable, and advantageous to the North and to the South, exacting no condition but that we should be duly accredited from Richmond as bearers of propositions looking to the establishment of peace.' Thus proffering a basis for conference as comprehensive as we could desire, it seemed to us that the President opened a door which had previously been closed against the Confederate States for a full interchange of sentiments, free discussion of conflicting opinions, and untrammelled effort to remove all causes of controversy by liberal negotiations. We, indeed, could not claim the benefit of a safe-conduct which had been extended to us in a character we had no right to assume, and had never affected to possess; but the uniform declarations of our Executive and Congress, and their thrice repeated, and as often repulsed, attempts to open negotiations, furnish a sufficient pledge to assure us that this conciliatory manifestation on the part of the President of the United States would be met by them in a temper of equal magnanimity. We had, therefore, no hesitation in declaring that if this correspondence was communicated to the President of the Confederate States, he would promptly embrace the opportunity presented for seeking a peaceful solution of this unhappy strife. We feel confident that you must share our profound regret that the spirit which dictated the first step towards peace had not continued to animate the counsels of your President. Had the representatives of the two Governments met to consider this question, the most momentous ever submitted to human statesmanship, in a temper of becoming moderation and equity, followed as their deliberations would have been by the prayers and benedictions of every patriot and Christian on the habitable globe, who is there so bold as to pronounce that the frightful waste of individual happiness and public prosperity which is daily saddening the universal heart, might not have been terminated; or if the desolation and carnage of war must still be endured through weary years of blood and sufInstead of the safefering, that there might not at least have been infused into its conduct something more of the spirit which softens and partially redeems its brutalities? conduct which we solicited, and which your first letter gave us every reason to sup

pose would be extended for the purpose of initiating a negotiation in which neither Government would compromise its rights or its dignity, a document has been presented which provokes as much indignation as surprise. It bears no feature of resemblance to that which was originally offered, and is unlike any paper which ever before emanated from the constitutional Executive of a free people. Addressed to whom it may concern.' it precludes negotiation, and prescribes in advance the terms and conditions of peace. It returns to the original policy of 'No bargaining, no negotiations, no truces with rebels except to bury their dead, until every man shall have laid down his arms, submitted to the Government, and sued for mercy.' What may be the ex planation of this sudden and entire change in the views of the President, of this rude withdrawal of a courteous overture for negotiation at the moment it was likely to be accepted, of this emphatic recall of words of peace just uttered, and fresh blasts of war to the bitter end, we leave for the speculation of those who have the means or inclination to penetrate the mysteries of his Cabinet, or fathom the caprice of his imperial will. It is enough for us to say that we have no use whatever for the paper which has been placed in our hands. We could not transmit it to the President of the Con federate States without offering him an indignity, dishonoring ourselves, and incurring the well-merited scorn of our countrymen.

"While an ardent desire for peace pervades the people of the Confederate States, we rejoice to believe that there are few, if any, among them, who would purchase it at the expense of liberty, honor, and self-respect. If it can be secured only by their submission to terms of conquest, the generation is yet unborn which will witness its restitution. If there be any military autocrat in the North who is entitled to proffer the conditions of this manifesto, there is none in the South authorized to entertain them. Those who control our armies are the servants of the people, not their masters; and they have no more inclination than they have right to subvert the social institutions of the sovereign States to overthrow their established Constitutions, and to barter away their priceless heritage of self-government. This correspondence will not, however, we trust, prove wholly barren of good results.

"If there is any citizen of the Confederate States who has clung to a hope that peace was possible with this Administration of the Federal Government, it will strip from his eyes the last film of such a delusion. Or, if there be any whose hearts have grown faint under the suffering and agony of this bloody struggle, it will inspire them with fresh energy to endure and brave whatever may yet be requisite to preserve to themselves and their children all that gives dignity and value to life, or hope and consolation to death. And if there be any patriots or Christians in your land, who shrink appalled from the illimitable vista of private misery and public calamity which stretches before them, we pray that in their bosoms a resolution may be quick ened to recall the abused authority and vindicate the outraged civilization of their country. For the solicitude you have manifested to inaugurate a movement which contemplates results the most noble and humane, we return our sincere thanks, and are, most respectfully and truly, your obedient servants,

"C. C. CLAY, JR.
"JAMES P. HOLCOMBE."

CHAPTER LXX.

Finances of 1863.-Revenue.-Sales of Bonds.-Effect of Paper Money.-Policy of Mr. Chase.-Gold Law, and its Effects.-Mr. Chase Resigns.-Finances of 1864.Sales of Bonds in Europe.-Statement of Debt.-National Banks.-Prices of Gold. THE financial resources of the Government were developed with the most extraordinary power and effect as the war proceeded. The immense pressure of continual paper issues upon the markets, in discharge of the vast claims upon Government, could have no other effect than a continual depreciation of the value of that paper. In a previous chapter the finances of the Government were brought down to the close

of the fiscal year 1863, at which time the debt had accumulated to $1,098,793,181. The receipts of the fiscal year, ending June 30, 1863, comprised $69,059,642 from customs, and $42,340,124 from taxes, making together $111,399,766 from revenue. There was borrowed in that year $776,682,361, making together $888,082,128, to meet an expenditure of $895,796,630. The fiscal year 1864 opened with $411,190,065 legal tender money outstanding, and gold at a premium of 150. The internal revenue and customs taxes were so modified as, it was hoped, to increase the revenue of the year at least fifty per cent. The depre ciation of paper had, however, greatly increased the expenses of the Government, by enhancing the cost of most articles of which the Government was the purchaser, and making it requisite to increase the pay of the troops, as well as to swell the sum of the bounties offered. It was very clear that, no matter how near to the estimates the receipts from taxes might come, the increased expense caused by the depreciation of paper would more than absorb the sum of the taxes, and that the dependence of the Government must be upon borrowing. In pursuing this course, the Government varied the form of the bonds offered in the market. Up to the close of May, 1863, the gold bonds of the Government had not met with much sale, because of their high price as compared with the value of other commodities upon the market. The property of the people had been locked up in goods and merchandise that were not readily salable when the war broke out. It was not until the issue of Government paper, in exchange for commodities at very high prices, had transmuted goods into Government paper, that the people had money or paper to invest in the bonds of the Government. In the spring of 1863 very active sales of goods had taken place for paper, which had depreciated to forty-two cents per dollar. High prices had been obtained in this paper for merchandise, and when gold began to decline in May, the desire to convert the paper money into the gold bonds enabled the Government to negotiate a considerable amount of the 5-20 bonds. In the first quarter of the fiscal year, 1864, $109,631,250 of those bonds were sold. In addition, $15,000,000 more legal-tender notes were issued. The sales of the 5-20 bonds continued up to the middle of January, 1864, the rate of gold remaining at about 152. The Secretary of the Treasury was then induced to stop the sale of the gold bonds, and to issue a new form of legal-tender notes, bearing interest, to the extent of $150,000,000. The effect of this was to send the price of gold up a little, and this tendency was enhanced by the attempts of Congress to check the rise, by interfering with the freedom of individual action. The issues of legal tender then became necessary, because the sales of the Government bonds were less free.

Meantime the customs revenues were very large, exceeding the estimates to a considerable extent. The law guaranteeing that the public interest should be paid in gold, had required that the customs receipts should be applied, first, to the payment of interest on the public debt, and secondly, to the purchase annually of one per cent. of the entire public debt, as a sinking fund. In March, 1864, gold was at a premium of 160, and a bill was brought into Congress to allow the Secretary to sell in

the open market the gold not required for the interest. This was refused; nevertheless, the Secretary caused to be issued the following notice:"UNITED STATES TREASURY, NEW YORK, March 23, 1864.

"By direction of the Secretary of the Treasury, notice is hereby given that until further orders I will issue to importers, for payment of duties on goods imported by them, certificates of deposit of gold coin, to the credit of the collector of any port as desired in exchange for notes, at a quarter of one per centum below the current market value of gold.

"These certificates are not assignable, but will be receivable by the collector from the party to whom they are issued. "J. J. CISCO, "Assistant Treasurer of the United States.

"No.

"I certify that

lector of the Port of New York $

United States Treasury, New York, 1864. has this day deposited to the credit of the Colin gold coin. This certificate is receivable only for duties on imports from the party to whom it is issued, and upon his indorseAssistant Treasurer.

ment.

The gold certificates thus sold were used for the payment of customs, in the view of checking the demand for gold. A considerable quantity of gold was also sent to London, and exchange drawn against it was sold for paper in the same manner. Congress now passed a resolution increasing the duty on imported goods fifty per cent. for sixty days, to take effect on April 29th. The effect of this was to cause very large entries of goods for duties in April, and consequently to draw gold into the Treasury, and a further rise in gold resulted. Congress now took measures to stop dealing in gold,* by passing a law which

[PUBLIC-NO. 104.]

AN ACT TO PRONIBIT CERTAIN SALES OF GOLD AND

FOREIGN EXCHANGE.

hired and occupied by him individually, or by s partnership of which he is a member.

SEC. 3. And be it further enacted. That all contracts made in violation of this act shall be absolutely void.

SEC. 4. And be it further enacted, That any person who shall violate any provisions of this act shall be held guilty of a misdemeanor, and, on conviction thereof, be fined in any sum not less than one thousand dollars, nor more than ten thousand dollars, or Le imprisoned for a period not less than three months nor longer than one year, or both, at the discretion of the court, and shall likewise be subject to a penalty of one thousand dollars for each offence.

gold coin or bullion, or of any foreign exchange or any contract for any such purchase or sale, at any other place than the ordinary place of bustBe it enacted by the Senate and House of Rep-ness of either the seller or purchaser, owned or resentatives of the United States of America in Congress assembled, That it shall be unlawful to make any contract for the purchase or sale and delivery of any gold coin or bullion, to be delivered on any day subsequent to the day of making such contract, or for the payment of any sum, either fixed or contingent, in default of the delivery of any gold coin or bullion, or to make such contract upon any other terms than the actual delivery of such gold coin or bullion, and the payment in full of the agreed price thereof, on the day on which such contract is made, in United States notes or national currency, and not otherwise; or to make any contract for the purchase or sale and delivery of any foreign exchange to be delivered at any time beyond ten days subsequent to the making of such contract; or for the payment of any sum, either fixed or contingent, in default of the delivery of any foreign exchange, or upon any other terms than the actual delivery of such foreign exchange within ten days from the making of such contract, and the immediate payment in full of the agreed price thereof on the day of delivery in United States notes or national currency; or to make any contract whatever for the sale and delivery of any gold coin or bullion of which the person making such contract shall not, at the time of making the same, be in actual possession. And it shall be unlawful to make any loan of money or currency not being in coin to be repaid in coin or bullion, or to make any loan of coin or bullion to be repaid in money or currency other than coin.

SEC. 2. And be it further enacted, That it shall be further unlawful for any banker, broker, or other person, to make any purchase or sale of any

SEC. 5. And be it further enacted, That the penalties imposed by the fourth section of this act may be recovered in an action at law in any court of record of the United States, or any ever of competent jurisdiction, which action may be brought in the name of the United States by any person who will sue for said penalty, one half for the use of the United States, and the other half for the use of the person bringing such action. And the recovery and satisfaction of a judgment in any such action shall be a bar to the imposition of any fine for the same offence in any prosecution instituted subsequent to the recovery of such judgment, but shall not be a bar to the infliction of punishment by imprisonment, as provided ly said fourth section.

SEC. 6. And be it further enacted, That all acts and parts of acts inconsistent with the previ sions of this act are hereby repealed. Approved June 17, 1864.