table by the House.* The free silver issue was now vigorously pushed. Congressman R. P. Bland, of Missouri, on July 25, 1876, had introduced a bill in the House providing for a free and unlimited coinage of gold and silver at the ratio of 16 to 1.† The House passed the bill after various amendments November 5, 1877, by a vote of 164 to 34. The Senate, however, defeated this bill in its original form and a compromise was offered by Senator Allison. The bill was finally passed February 15, 1878, by a vote of 48 to 21 in the Senate and

February 21 in the House by a vote of 203 to 72, being known as the BlandAllison Act. It provided that there should be "coined at the several mints of the United States silver dollars of the weight of four hundred and twelve and one-half grains troy of standard silver as provided in the Act of January 18, 1837, * which coins together with all silver dollars heretofore coined by the United States of like weight and fineness, shall be a legal tender, at their nominal value, for all debts and dues, public and private, except where otherwise expressly stipulated in the contract." This law also provided that "the Secretary of the Treasury is authorized and directed to purchase from time to time, silver bullion, at the market price thereof, not less than two mil

* McPherson, Handbook of Politics, 1878, p. 143 et seq.; Hepburn, The Contest for Sound Money, pp. 233, 235, 237-238.

† Congressional Globe, p. 5186, 44th Congress, 1st session.

Laughlin, Bimetallism, pp. 181-183.

lion dollars worth per month, nor more than four million dollars worth per month and cause the same to be coined monthly, as fast as so purchased, into such dollars." President Hayes vetoed the bill on February 28* but on the same day it was passed over his veto by both Houses (in the House by a vote of 196 to 73 and in the Senate by a vote of 46 to 19). It then became law and continued in force until 1890.†

To further embarrass and humiliate the treasury a resolution was introduced by Stanley Matthews on December 6, 1877, while the coinage bill was under discussion, declaring that all the bonds of the United States "issued or authorized to be issued " were payable in the silver dollars

* Richardson, Messages and Papers, vol. vii., pp. 486-488; Globe, pp. 1418-19, 45th Congress, 2d session; Watson, American Coinage, pp. 151154.

Statutes-at-Large, vol. xx., p. 25; Dewey, Financial History, pp. 405-408; Bolles, Financial History, vol. iii., p. 390 et seq.; Noyes, American Finance, pp. 38, 41-42; Laughlin, Bimetallism, pp. 183-186; Hepburn, Contest for Sound Money, pp. 286-290, 563-565; Taussig, The Silver Situation, pp.1-17; Watson, American Coinage, pp. 146-150; Sherman, vol. ii., pp. 603–623; Dunbar, Currency, Finance and Banking Laws, pp. 246248; Upton, Money in Politics, pp. 212–219; Blaine, vol. ii., pp. 602-610; Crawford's Blaine, pp. 419-437. "Substantially what this law of

1878 did was to make a token coin of the old standard silver dollar. It restored it, but it limited the amount which could be coined, and it went over to the principle of coining on government account.". Sherwood, Theory of Money, p. 167. See also J. F. Johnson, Money and Currency, pp. 347-353. For the votes taken at various times see McPherson, Handbook of Politics, 1878, pp. 127-135.

provided by the Bland Law.* "The extraordinary character of this resolution may be judged from the fact that it was proposed and passed in both Houses while the Coinage Act was still pending, and while, therefore, there was not in existence the coin which was duly declared a legal tender for settlement with public creditors." +

As the time for carrying the law into effect drew near the opponents became louder prophets of evil. They predicted that business would be utterly prostrated and that it would be impossible to meet the enormous demands for coin. The premium on gold, however, continually diminished, and paper money was at par on December 17, 1878.‡

Sherman, however, went steadily forward perfecting his plans but took the extra precaution to employ an increased clerical force to assist in paying out the coin. These clerks were not needed, for Sherman's readiness to pay had allayed all fears. At the closing hour the banks had more gold in their vaults than at the opening. Resumption had been effected without the slightest trouble and its salutary influence was immediately felt. Business now began to revive, and the tide of prosperity throughout the whole country continued to rise higher and

*Passed the Senate January 25, 1878 (43 to 22) and the House January 29 (189 to 79). Laughlin, Bimetallism, p. 201 et seq.; McPherson, Handbook of Politics, 1878, pp. 136-139; Burton's Sherman, pp. 267-269; Hepburn, Contest for Sound Money, p. 291.

Noyes, American Finance, p. 38. ‡ Ibid, p. 47.

measure of value in the United States became gold."

The prosperous condition of the country was further augmented by the blight which fell on European crops in 1879; England was hit particularly hard, practically every growing crop being ruined by frost; in France the wheat crop was ruined by snow, and Austria, Germany and Russia yielded the smallest wheat crops in years. On the other hand the crops in this country were huge, the wheat crop alone exceeding by 28,000,000 bushels that of any previous year. The crop of Indian corn was the largest recorded up to that time; coincident with these records also came the completion of the tide-water pipe-lines from the Pennsylvania oil-fields, and the partial failure of the cotton crop of India. Consequently the wheat shipments which in 1878 did not average beyond 2,000,000 bushels weekly, now averaged 1,000,000 bushels daily; the export of cotton was the largest yet recorded for a single season; the exports of oil rose nearly 2,000,000 barrels over the highest previous record; and the shipments of cattle increased in such proportions as to force the

* Bolles, Financial History, vol. iii., p. 301 et seq.; Dewey, Financial History, pp. 374-378; Noyes, American Finance, pp. 48-60; Sherman, vol. ii., pp. 623-672, 686-702; Burton's Sherman, pp. 257-279. See also President Hayes's annual message of December 1, 1879, Richardson, Messages and Papers, vol. vii., p. 558.

Taussig, The Silver Situation in the United States, p. 3 (G. P. Putnam's Sons).

Annual Reports of the Department of Agri. culture.

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British graziers out of their own market.*

With an increasing export trade came a revival in the general industries of the country. The iron trade was flushed with orders far beyond capacity; the manufacture of cottonspinning machinery revived with the rise in the price of raw cotton; prices in the dry-goods trade rose 50 per cent., with mills running under full pressure and large orders unfilled; and every branch of industry felt the stimulus. As the balance of trade was now in our favor gold began to come from Europe, within three months $60,000,000 being shipped from England, France and Germany. "As the special need of the American bankers was currency suitable for use in interior trade, a large part of this specie went directly into the treasury in exchange for legal-tender notes another wholly new phenomenon, impossible except under resumption."

The gold reserve in the treasury which had been very low gradually rose until at the beginning of November, 1879, it stood at $157,140,114; and

* See the Annual Reports of the New York Chamber of Commerce and the New York Produce Exchange for 1879, and the files of the New York Commercial and Financial Chronicle. David A. Wells, in his Recent Economic Changes (D. Appleton & Co.), pp. 6-7, says that the exports of wheat rose "from 40,000,000 bushels in 1877 to 122,000,000 bushels in 1879, 153,000,000 bushels in 1880 and 150,000,000 bushels in 1881, while the corresponding values of the amount exported rose from $47,000,000 in 1877 to $130,000,000 in 1879, $190,000,000 in 1880, and $167,000,000 in 1881. There was also a corresponding increase in the quantity and value of the American exports of other cereals, and also of most meat products and provisions."

.† Noyes, American Finance, p. 58.

whereas in the early months of 1879 customs payments were made in legaltenders, in November and December more than 60 per cent. of these were made in gold.

With the influx of gold, the bumper crops, the awakening of industry and the general prosperity came speculation and inflation of prices, such as the rises in the wheat and iron markets and of corporation shares on the stock markets, but after these bubbles had collapsed "the underlying strength and healthfulness of the markets was asserted." The tide of immigration set this way, increasing each month until, in 1882, 788,992 came into the country, nearly onethird of whom were Germans.

The political situation changed with the industrial improvement. Those who had previously been foremost in their predictions of disaster upon specie resumption gradually swung into line when that event was successfully consummated. The fall elections of 1879 were largely in favor of the Republicans, Maine, Ohio, New York, Michigan, and Iowa giving large Republican majorities. The situation was not much changed when the presidential election of 1880 came on.

The parties held their nominating conventions in the spring and early summer and selected the following candidates:

In the history of their party's accomplishments the Republicans said in their platform:

"Without resorting to loans it has, since the war closed, defrayed the ordinary expenses of Government, besides the accruing interest on the public debt, and disbursed annually over $30,000,000 for soldiers' and sailors' pensions. It has paid $888,000,000 of the public debt, and by refunding the balance at lower rates has reduced the annual interest from nearly $151,000,000 to less than $89,000,000. All the industries of the country have revived, labor is in demand, wages have increased, and throughout the entire country there is evidence of a coming prosperity greater than we have ever enjoyed."

The platform also declared for government aid to educational projects; for a national law against the appropriation of public funds to sectarian schools; for the levying of revenue duties so as to favor American labor; for the abolishment of polygamy; for the restriction of Chinese immigration; for the reform of civil service; etc. The Democrats demanded that Church and State should be kept apart; that common schools be fostered and protected; that the civil service be thoroughly reformed; that a tariff be enacted for revenue purposes only; that the election laws be reformed; that the treaty with China be revised, etc. They concluded by saying:

"We congratulate the country upon the honesty and thrift of a Democratic Congress, which has reduced the public expenditures $10,000,000 a year; upon the continuation of prosperity at home and the National honor abroad; and above all, upon the promise of such a change in the administration of the Government as shall insure a genuine and lasting reform in every department of the public service."

After an exciting canvass, the election resulted in the choice of Garfield

and Arthur. Garfield received an electoral vote of 214 against an electoral vote of 155 for General Hancock. At this election the Republicans secured a majority in the House of Representatives, and also gained control of the Senate. The result gave a wonderful forward impulse to business of every kind.*

Beside passing the usual appropriation bills the last session of the Fortysixth Congress, which expired March 4, 1881, also discussed some other important legislation. The most important measures under consideration were bills for refunding the public debt and for making a new apportionment of Representatives in Congress under the census of 1880.

The bill for facilitating the refunding of the national debt had been pending during the preceding session and was again taken up in the third session. The original bill provided that" in lieu of the bonds authorized to be issued by the act of July 14, 1870,

and the acts amendatory thereto and the certificates authorized by the act of February 26, 1879 [bearing five, four and a half, and four per

* Stanwood, History of Presidential Elections, pp. 345-374 and History of the Presidency, pp. 394-418; McClure, Our Presidents and How We Make Them, pp. 270-286; McPherson, Handbook of Politics, 1880, pp. 188-198; Andrews, Last Quarter-Century, vol. i., pp. 307-318; Blaine, vol. ii., pp. 657-672; Sherman, vol. ii., pp. 766783; Hoar, vol. i., pp. 384-404; A. R. Hancock, Reminiscences of W. S. Hancock, pp. 170-176; Conkling, Life of Conkling, pp. 588-632; Conwell's Garfield, pp. 327-334; Burton's Sherman, pp. 298-306; and lives of Blaine by Crawford, pp. 477-482, Hamilton, pp. 479-490, Stanwood, pp. 223-232, and Ridpath, pp. 140-141.

cent. interest] bonds in the amount of not exceeding $500,000,000 which shall bear interest at the rate of 32 per cent. per annum, redeemable, at the pleasure of the United States, after twenty years and payable forty years after the date of issue, and also notes in the amount of $200,000,000 bearing interest at the rate of 32 per cent. per annum, redeemable, at the pleasure of the United States, after two years and payable in ten years," should be issued. Debate was opened in the House on March 4, 1880, but no vote was reached.* The passage of The passage of this bill would have saved the country enormous sums of money.

When the bill was called upon for action in the House December 14, 1880, the rate of interest was reduced to three per cent., and a provision made that "no bonds should be taken as security for bank circulation except the three per cent. bonds provided for by that bill." Other amendments were made and it passed the House January 19, 1881. After amendments by the

13

serious embarrassment and disaster to the business of the country " that on March 3, 1881, President Hayes vetoed the bill, in his message saying:

"To prevent the further organization of banks is to put in jeopardy the whole system, by taking from it that feature which makes it, as it now is, a banking system free upon the same terms to all who wish to engage in it. Even the existing banks will be in danger of being driven from business by the additional disadvantages to which they will be subjected by this bill. In short, I cannot but regard the fifth section of the bill as a step in the direction of the destruction of the national banking system."

No further action was taken on the bill

and it failed to become a law.*

The new apportionment bill increased the ratio of representation from 131,425 under the census of 1870 to 151,911 under the census of 1880. When first introduced the ratio under the 1880 census was much higher and the increase in representation was from 293 to 319. But the bill carrying the representation at the 319 figure failed to pass at this session and went over to the first session of the Fortyseventh Congress. At that time the ratio was decreased and the number

the House the bill was passed and sent to the President March 1.†

Section 5 of the bill was regarded as so hostile to the interests of the national banks and so likely to "bring

* McPherson, Handbook of Politics, 1880, pp. 148-149, 1882, pp. 13-14.

Ibid, 1882, pp. 10-11, 14-25.

in this form President Garfield approved the bill February 25, 1882†

*Sherman, Recollections, vol. ii., pp. 796-801; Richardson, Messages and Papers, vol. vii., pp. 637-639; Bolles, Financial History, vol. iii., pp. 328-329; McPherson, Handbook of Politics, 1882, Pp. 11-12.

McPherson, Handbook of Politics, 1882, pp. 39-44, 192-193.