« PreviousContinue »
by 1885 had risen to 45.86 per cent.* Professor Taussig says "had the higher duties of the act of 1883 been brought before Congress in a separate bill, there can be no doubt that their enactment would have been impossible. That they were in many cases half concealed by means of changes in classification, or were coupled with apparent reductions on other articles in the same schedules, shows that the protectionists themselves had some fear of putting them nakedly before the public. Taussig also says that the measure" is best described as a halfhearted and unsuccessful attempt on the part of protectionists to bring about an apparent reform of the tariff," that "it was framed by men who at heart were protectionists," and that the reductions made "had little effect other than the change of the figures on the statute-book." The "infant industries" demanded protection and the reductions were small, the more radical protectionists securing" modifications along lines of high and even increased protection." Congress treated the recommendations of the commission "with disapproval, if not with contempt." The duties were raised on "certain classes of woolen goods, especially on dress goods, and the finer grades of cloths and cassion cotton hosiery, embroideries, trimmings, laces, and insertions, constituting about two-thirds
* Howe, Internal Revenue System, p. 221 et seq. Stanwood, 'Tariff Controversies, vol. ii., p. 219 et seq.
Taussig, Tariff History, pp. 242-254.
of the cottons imported; iron ore and certain manufactures of steel." The reductions were on the finer grades of wool, on the cheaper grades of woolen and cotton goods, on steel rails, copper, marble, nickel and barley."*
But the bill was not satisfactory even to the Republican protectionists, John Sherman being particularly outspoken in his criticism of the bill. As it was, the conference committee of the two Houses, instead of reducing duties raised them so that in some instances they equalled the old war tariff.
A period of financial depression now set in, culminating in the panic of May and June, 1884, not however caused by the enactment of the tariff law. The gigantic speculation in railroads had reached its zenith in 1880, and a retrograde movement set in. Prices of securities declined for three years due to the ruinous competition of new lines and lowered rates and above all by the speculations and manipulations of their managers. In 1884 and 1885 forty-one railway corporations holding 19,000 miles of track were placed
421. * Dewey, Financial History, p. Taussig, pp. 235-253, for a discussion of the various schedules, and p. 266 for a table showing changes.
† Recollections, vol. ii., p. 851 et seq.
This was undoubtedly due in some measure to the lack of proper consideration of the bill owing to the desire to pass it before that Congress expired. Debate on the bill began January 25 and ended March 3, but a large part of the discussion which should have been given to the bill was taken up with points of parliamentary law. For a summary of the debate see Stanwood, Tariff Controversics, vol. ii., pp. 208-218.
PANIC OF 1884.
under receivership and thirty-seven smaller railroad properties were sold under foreclosure.* During 1883 there were several commercial failures and prices began to decline; goods accumulated in the warehouses; gold flowed away and ready cash decreased daily. On January 1, 1884, the New York & New England Railroad went into receivers' hands, followed by the North River Company January 12. These were followed on May 6 by the
failure of the National Marine Bank of New York, the president of which was associated with the firm of Grant & Ward, which failed shortly afterward with liabilities of $17,000,000.
* Coman's Industrial History, p. 321. A. T. Hadley, Railroad Transportation, p. 52 (G. P. Putnam's Sons), states that of the 29,000 miles constructed in 1880-82 "not more than one-third were justified by existing business. Another third perhaps were likely to be profitable at some future date. Of the remainder some were built to increase the power of existing systems, where they were not needed. Some were built to put money into the hands of the builders as distinct from the owners. Some were built to sell as a blackmailing scheme against other roads."
Ex-President Grant was a special partner in this firm but was innocent of any wrongdoing in connection with the firm's affairs, as Ward had used Grant's name without his knowledge to cover some gigantic speculations on his own private account. Nevertheless, Grant suffered both in fortune and reputation, even pledging his sword of honor and other priceless gifts to partially redeem the notes which bore his name. He then began to write his Memoirs to recoup his lost fortunes and provide for the future of his family, as he was then nearly bedridden by an incurable disease. See W. C. Church, U. S. Grant, pp. 441-454; Henry Clews, Twenty-Eight Years in Wall Street, pp. 215-221; Garland, U. S. Grant, pp. 486-503; Badeau, Grant in Peace, pp. 418-424. See also Ward's account of these transactions in the New York Herald, issues of December 19, and 26, 1909 and January 2 and 9, 1910.
On the 13th the Second National Bank suspended payment with liabilities of $3,000,000; on the 14th Donnel, Lawson & Simpson and Hatch & Foote failed, followed by the Savings Bank of New York, Fiske & Hatch and many others on the 15th, the total liabilities of the wrecked concerns being about $240,000,000.
Moreover, as defaulting was becom
ing general, the Secretary of the
Treasury, in order to sustain the credit by the most regular methods, pledged himself to prepay the portion
of the national debt soon to come due.
Besides this $24,915,000 of Clearing House certificates of deposit were issued to tide over some of the toppling institutions. Things then began to settle down, the general distrust diminished, credit circulation became re-established and the rate of discount declined to 5 per cent. (having been as high as 4 per cent. per day).
There had been no suspension of specie payment during the panic, and this, together with the outlook for a bounteous harvest, gave courage.
While the panic centered in New York, there were numerous failures in other cities during the year, 11 National banks and about 130 other banks and private bankers being counted in the list. Almost the entire amount of the losses sustained in this panic was entirely borne by financiers and specu
* Clement Juglar, History of Panics, pp. 102, 106-107; Henry Clews, Twenty-Eight Years in Wall Street, pp. 162-173.
lators rather than by manufacturers and traders."'*
But in the spring of 1884 a slump in the prices of agricultural products had also occurred. The wheat crops of the world were larger than ever before and as a result the price fell below that of 1878. The decreased price produced a stagnant condition in interior trade because the Western farmers would not ship their produce East but preferred to hold it for more favorable market conditions. As a consequence railway freight traffic was greatly diminished. Dividends on railroad stocks, therefore, were greatly reduced and in many cases passed, and consequently investors hesitated to embark in railroad enterprises of great magnitude.†
The situation was thus a double handicap to the Republicans in the coming presidential election, for they must account for a financial panic in the East and depression in the Western agricultural markets. They were also called upon to explain governmental extravagancies and the prevalence of corruption.
The presidential and vice-presidential candidates were as follows:
The Republican platform demanded that the imposition of duties on foreign imports shall be made, not 'for revenue only,' but that in raising the requisite revenues for the government such duties shall be so levied as to afford security to our diversified industries and protection to the rights and wages of the laborer." The party pledged itself to a readjustment of the tariff, urged the establishment of an international standard in the coinage of gold and silver, and the enactment of laws for the regulation of railways, and denounced the importation of contract labor.
The Democrats denounced the Re
publican party as "an organization for enriching those who control its machinery," and called attention to the many pledges of former years that the Republicans had not redeemed. The platform pledged the party to "purify the Administration from corruption, to restore economy, to revive respect for law and to reduce taxation to the lowest limit consistent with due regard to the preservation of the faith of the nation to its creditors and pensioners." It further pledged a revision of the tariff; recommended more intimate commercial relations with the North, Central and South American republics; favored the enactment of laws by which labor organizations might be incorporated; and demanded a broader policy toward the American merchant marine. In this election the ranks of the Republican party were rent by internal disputes, for the reform element was
CLEVELAND ELECTED; WASHINGTON MONUMENT.
bitterly opposed to Blaine. These reformers, called "mugwumps," were led by Carl Schurz and G. W. Curtis and were represented in the press by the New York Times and Harper's Weekly. They repudiated the party nominees and platform, endorsed Cleveland, and threw all their influence on his side. This bitterly fought campaign was characterized and disgraced by gross personalities, and the result was close.
At a meeting of clergy, in which all denominations were supposed to be represented, held at the Fifth Avenue Hotel, New York, in the interests of the Republicans, one of the ministers, Rev. R. B. Burchard, in a speech declared the Democratic party to be the party of "Rum, Romanism and Rebellion." This unfortunate and misdirected remark created much excitement and did untold harm to the Republican cause, for though Blaine denied any responsibility for it the Democrats had spread millions of circulars bearing the charge broadcast over the land and the denial came too late. Cleveland was elected, receiving
219 electoral votes against 182 for Blaine.*
The year 1884 was also noted because of the opening of the Brooklyn. Bridge, at that time the largest wire suspension bridge in the world. In this year also Alaska was constituted a regularly organized territory of the United States.
On Saturday, February 21, 1885, the great Washington Monument, at the national capitol, was dedicated with imposing ceremonies. The orator of the occasion was Hon. Robert C. Winthrop, of Massachusetts, who in 1848 had been the orator when the cornerstone of the same monument was laid. The monument is 555 feet high and cost about $1,500,000.†
* Stanwood, History of Presidential Elections, pp. 375-411, and History of the Presidency, pp. 419-449; McClure, Our Presidents and How We Make Them, pp. 288-315; McPherson, Handbook of Politics, 1884, pp. 197-222; Blaine, vol. ii., pp. 572-593; Sherman, vol. ii., pp. 885-890; Hoar, Autobiography, vol. i., pp. 405-408; lives of Cleveland by W. U. Hensel, pp. 93-120; W. O. Stoddard, pp. 166–198; J. L. Whittle, pp. 56–66; lives of Blaine by Crawford, pp. 553-583; Hamilton, pp. 572-593; Stanwood, pp. 267-295; Ridpath, pp. 146-152.
† Sherman, vol. ii., pp. 897–902, where speeches are given.
CLEVELAND'S CABINET; VICE PRESIDENT HENDRICKS DIES.
PRESIDENT CLEVELAND'S FIRST ADMINISTRATION.
President Cleveland inaugurated - His Cabinet Death of Vice-President Hendricks-The Presi dential succession - Dispute between President and Senate - Repeal of Tenure-of-Office Act — Pension bills-The Hatch Act - Newfoundland fisheries dispute once more revived Canadians seize American vessels Commission appointed and treaty signed Rejected by Senate - Modus vivendi agreed upon - The Samoan dispute - Treaties signed by Samoans. German aggressions - Conference between Great Britain, Germany and the United States - Independence of islands guaranteed by three powers-Disaster at Apia - Statute of Liberty presented to the United States by France - Edmunds-Tucker anti-polygamy bill passed-Charleston earthquake - Death of Chief Justice Waite - Fuller appointed - Department of Labor created — Washington, Montana, North and South Dakota admitted - Johnstown flood - Indian troubles - Interstate Commerce Act Condition of finances-Mills tariff debate. - Labor conditions - Boycotts - Hay. market massacre Decline of prices - Treasury surplus used to reduce interest-bearing debt Elections of 1888.
Grover Cleveland was sworn into office March 4, 1885. In his inaugural address he urged that public expenditures be limited to actual needs; he said that taxation ought to be reduced by a readjustment of the revenue schedules; and earnestly hoped that the country would continue on its course of peace, commerce and honest friendship with all nations."'* The members of the Cabinet were Thomas F. Bayard, of Delaware, Secretary of State; Daniel Manning, of New York, Secretary of the Treasury, succeeded by Charles S. Fairchild, of New York, in 1887; William C. Whitney, of New York, Secretary of the Navy; William C. Endicott, of Massachusetts, Secretary of War; L. Q. C. Lamar, of Mississippi, Secretary of
the Interior, succeeded by William F. Vilas, of Wisconsin, in 1888; Augustus H. Garland, of Arkansas, AttorneyGeneral; and William F. Vilas, of Wisconsin, Postmaster-General, succeeded by Don M. Dickinson, of Michigan, in 1888, when Vilas became Secretary of the Interior.
On November 25 Vice-President Hendricks died, and the question of Presidential succession came under discussion. Congress when in session could, under the Constitution, make provision in case either the President or Vice-President should die or be removed from office, but should both these officials die at the same time while Congress was not in session, the country would be without executive guidance. President Cleveland, therefore, recommended in his annual message of December 8, 1885, to the first