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pay for our exports and securities and and more in legal-tenders,* and the a large part of this went into the treas- Secretary of the Treasury, taking adury in exchange for silver and legal- vantage of the above provision, after tender notes. Thus the depleted gold the first week in July, 1892, practically reserve was restored. But for various abandoned the payment of gold into causes the price of wheat slumped, the New York Clearing House, hoardEnglish investors began to view the ing as much as possible in the treascondition of the United States treas- ury. The year 1892 then passed withury and currency with alarm,* and a out much further trouble in financial selling movement in American securi- circles. ties took place, so that in the first six

Political conditions in the country months of 1892 $11,500,000 were now changing. The elections shipped to Europe and for some time which took place in November, 1890, averaged two to seven millions weekly. resulted in a decisive Democratic vicBy the close of May, 1892, the reserve tory. The people were apparently had fallen to $114,231,883 and at the

convinced that the McKinley law conrate of depletion would soon fall below tained a pernicious principle and the $100,000,000.1

Republican party sustained the most In 1882 Congress had passed a law overwhelming defeat in the thirty-six providing that the Secretary of the years of its existence. States whose Treasury might“ suspend the issue of

suspend the issue of Republicanism had seldom been sucsuch [gold] certificates whenever the cessfully questioned swung into the amount of gold coin and gold bullion

Democratic column, Massachusetts, in the Treasury available for the re

Pennsylvania, Nebraska, Illinois and demption of United States notes falls Michigan being among the number. below $100,000,000.”'1

Besides the The House of Representatives chosen outflow of gold from the treasury, the

in this year had a Democratic pluralrevenues were now being paid more

ity of 149. But the Senate was still

Republican and the Democratic maThe general conditions are given in Lauck,

jority in the House availed little. He says that the reduced revenues


year 1892, however, under the McKinley tariff and the extravagance marked by many events in the indusof Congress, in conjunction with the increase of

pp. 82-90.


trial world which boded little good to silver certificates which glutted the market had completely upset everything. The English appre- the Republicans in the presidential hensions were further increased by the fear that elections. “ Prices and cost of living we would enact a free coinage silver law. † Noyes, American Finance,

*"On the other hand the percentage of gold in Taussig, The Silver Situation, pp. 54–56, 68–69.

the customs receipts fell to 60, 40 and during the I Statutes-at-Large, chap. 290, sec.

summer months to 20 and 10 per cent."— Taussig, Congress, 1st session; White, Money and Banking, p. 206.

† Noyes, pp. 168- 173.



12, 47th

p. 57.

increased with little compensating ad- now appealed to the governor of the vance in wages. The farmers found State, who ordered

ordered the national no improvement in the markets for guard — 8,500 men — to restore order their products. The price of wheat and enforce obedience to the law. fell from eighty-four cents a bushel in The troops took possession of the 1890 to forty-nine cents in 1894. works on the 12th and on the 21st Prices of corn, oats, rye, and barley several leaders of the outbreak were declined in the same proportion. The arrested. The mills were again put in woolen manufacturers complained

complained operation under protection of the that the protection given them did not militia, and at the close of the month offset the enhanced cost of their raw the strike virtually collapsed, though materials. "*

The workingmen were not declared at an end until Novemthus relatively in a worse condition ber 20, 1892.* now than they had been before. They The miners in the Coeur d'Alene therefore went on a strike for higher mining region of Idaho also went on wages, but the employers resisted their strike and a clash occurred there early demands. The strikers became surly in July, when several non-union men and began to threaten. The employ- were killed. The strikers also dynaers became frightened and armed mited the railroad bridges leading themselves or hired detectives to pro- into the region so as to prevent troops tect them, and disastrous clashes oc- from reaching the scene of the outcurred.

break. Military rule, however, was That which roused the strongest established on the 17th and the leadfeeling was the strike at Homestead, ing rioters were placed under arrest. Pa. On June 30 the works of the The switchmen of the Erie and LeCarnegie Steel Company were closed high Valley Railroad at Buffalo went because of a disagreement between on strike and on August 14 burned employers and employees in regard to several loaded freight trains. The wages, and non-union men were after- sheriff of Erie county, being unable to ward employed in place of the strikers.

cope with the situation, called upon A force of Pinkerton men were em

the governor for aid and the entire ployed to protect the works and the national guard of the State was non-union employees, and on July 5

ordered to the scene of conflict. But and 6 these detectives were attacked

the strike failed because the other by the strikers. In the fight which railway unions would not order a ensued numerous lives were lost, and sympathetic strike. The militia was many on both sides were wounded.

* Wright, Industrial Evolution, pp. 309-312; The city authorities, being powerless, Appleton's Annual Cyclopædia, 1892; also the

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testimony before the Judiciary Committee as to Coman, Industrial History, p. 302 (edition of the employment of Pinkerton detectives, House 1905).

Misc. Doc. No. 335, 52d Congress, 1st session.



De nocratic Prohibition.. Peoples Socialist

John Bidwell, Cal.

J. B. Cranfill, Texas.


then withdrawn and order was re- Missouri, New Jersey, New York, stored.

North Carolina, South Carolina, TenWith these events still fresh in mind nessee, Texas, Virginia, West Virthe presidential elections were held. ginia, and Wisconsin, while Harrison The candidates were as follows:

carried only Iowa, Maine, Massachu

setts, Michigan, Minnesota, Montana, PARTY. President.

Nebraska, New Hampshire, South

Dakota, Ohio, Oregon, Pennsylvania, Republican..... Benjamin Harrison, Ind.. Whitelaw Reid, N. Y. Grover Cleveland, N. Y. . Adlai E. Stevenson, Ill.

Rhode Island, Vermont, Washington, James B. Weaver, Iowa. . James G. Field, Va.

and Wyoming. The Populist candiLabor.. Simon Wing, Mass. Charles H. Matchett, N. Y.

date, Weaver, carried Colorado, Idaho,

Kansas, Nevada, North Dakota, and In the Democratic convention there

received one of the electoral votes of had been a fight on the tariff plank,

Oregon. Mr. Cleveland's popular mabut as finally adopted it declared that jority over Mr. Harrison was 380,610, the Constitution did not give the

and the vote in the electoral college Federal government power to impose stood: Cleveland, 277; Harrison, 145; and collect tariff duties except for Weaver, 22. The Senate and the revenue purposes. In this platform House were also Democratic.* the trusts were denounced, and the Cleveland and Stevenson were inparty promised to enact laws, if the

augurated on March 4, 1893, and the candidates were elected, to prevent

new President appointed the following and control them. The convention

as the members of his Cabinet: Secalso adopted the following money

retary of State, Walter Q. Gresham, plank:

Illinois, who was later succeeded by “We hold to the use of both gold and silver Attorney-General Richard Olney, of as the standard money of the country, and to the Massachusetts; Secretary of the coinage of both gold and silver without discrimination against either metal or charge for mintage,

Treasury, John G. Carlisle, of Kenbut the dollar unit of coinage of both metals must tucky; Secretary of War, Daniel S. be of equal intrinsic and exchangeable value or

Lamont, of New York; Secretary of be adjusted through international agreement, or

such safeguards of legislation as shall ensure the Navy, Hilary A. Herbert, of Alathe parity of the two metals, and the equal power bama; Secretary of the Interior, Hoke of every dollar at all times in the markets and in the payments of debts; and we demand that all

Smith, of Georgia; Attorney-General, paper currency shall be kept at par and redeem. Richard Olney, of Massachusetts, who able in such coin."

upon taking over the portfolio of The election resulted in a sweeping State, was replaced by Judson HarDemocratic victory, Mr. Cleveland

* Stanwood, History of Presidential Elections, carrying Alabama, Arkansas, Califor

pp. 456-493, and History of the Presidency, pp. nia, Connecticut, Delaware, Florida, 486-518; McClure, Our Presidents and How We Georgia, Illinois, Indiana, Kentucky,

Make Them, pp. 337–359; Sherman, vol. ii., pp.

1160–1174; Whittle's Cleveland, pp. 134-145; Louisiana, Maryland, Mississippi, Porter and Boyle's McKinley, pp. 217-224.


mon, of Ohio; Postmaster-General, placent quiescence as the course of Wilson S. Bissell, of New York, fol- events might decide. lowed by William L. Wilson, of West But events were adverse to a peaceVirginia, in 1895; Secretary of Agri- ful solution of the difficulty. On Febculture, J. S. Morton, of Nebraska. ruary 20, 1893, the Philadelphia and

Previous to the election the con- Reading Railway, with $40,000,000 dition of the treasury had been pre- capital and $125,000,000 debt, went carious, and the Secretary made into bankruptcy, followed on May 5 by strenuous efforts to maintain the re- the National Cordage Company, with demption fund above $100,000,000. $20,000,000 capital and $10,000,000 In the latter part of 1892 and the liabilities. As the stocks of these early part of 1893 the drain on the companies were largely delt in on the reserve had been heavy, but the banks exchanges, the failures caused advanced enough gold to the govern- slump, carrying with them the whole

, ment* so that when the Cleveland stock market.*

stock market.* On June 26 the govadministration came in the new Secre

ernment of British India suspended tary of the Treasury had $100,982,

the free coinage of silver and the price 410 in the gold reserve and barely $25,

of silver dropped from 82 cents to 67 000,000 in other forms of money.”'\

cents per ounce in three days. Later This condition of affairs unsettled the

came the announcements of the failure money market, for it was feared that

of the Erie Railroad (July 25), and the government would not be able to the suspension of the Milwaukee Bank. redeem the legal-tender notes in gold

Bank depositors became frightened coin. This, therefore, was the chief and withdrew their deposits, the strain cause of the panic of 1893. The

being particularly violent on the New utterances of the Secretary of the

York banks, the reserves falling below

the legal requirements of 25 per cent. Treasury did not allay the feelings of apprehension and the public mind was

on July 8 and continuing so until Sep

tember 9. The Western banks now on the verge of panic, ready to be

began to call their loans placed with swept into active eruption or com

New York banks, and to keep these

banks from suspending the Eastern * Taussig, The Silver Situation, pp. 57-62. † Noyes, American Finance, p. 184. See also

banks during July shipped as much as the Report of the Secretary of the Treasury for $11,000,000 in cash each week to the 1893, p. 75; Cleveland, Presidential Problems,


p. 132 et seq.

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| This conclusion is reached by Lauck in his Panic of 1893, pp. 110–112. Ile says that “the crisis of 1893

did not arise from any difficulties abroad;

it was not due to an extension of mercantile and industrial credits, or to a scarcity of money in the United States,” but was caused " by widespread apprehensions as to the fixity of the gold standard of payments."

* For the range of prices of stocks see Lauck, Panic of 1893, p. 99.

† Horace White, Joney and Banking, p. 202.

† Noyes, American Finance, p. 192 et seq. Lauck, pp. 100, 101, says that “the deposits of the Clearing House, which were $431,000,000 in round numbers on June 3, had been reduced by August 29 to $370,000,000.”




* >*

It was obvious that this state of of the currency announced the failure affairs could not continue, and as the during the year of 158 national banks, greater part of the trouble was 172 state banks, 177 private banks, 47 charged to the Sherman Purchase law, savings banks, 13 loan and trust President Cleveland on June 30 con- companies and six mortgage comvoked the Fifty-third Congress in panies. Some of these institutions special session to assemble on August afterward resumed business, but the 7 to enact remedial legislation. Upon permanent damage was great. assembling Cleveland transmitted a Bank clearings were the lowest since message in which he asked for the re- 1885 peal of the Sherman silver act.* A “ The production of coal, both bill carrying such a provision was in- anthracite and bituminous, fell off; the troduced August 11 by William L. output of pig-iron, which had been Wilson, of West Virginia, and passed about 9,157,000 tons in 1892, fell to without amendment by the House, 6,657,000 tons in 1894; new railway August 28, by a vote of 239 to 108.t construction almost ceased; in 1894 The Senate, however, did not act upon there were 156 railways, operating a the bill for two months, but it was mileage of nearly 39,000 miles, in the finally passed by that body (October hands of receivers # The total 30 by a vote of 43 to 32 and by the capitalization in the hands of receivers House on November 1 by a vote of 194 was about $2,500,000,000, or oneto 94). It was signed by the Presi- fourth of the railway capital of the dent November 1 and became law.|| country.

commercial failures But the action of Congress was of increased from 10,344 in 1892, with no material benefit to the country at liabilities of $114,000,000 to 15,242 in this juncture – it had come too late 1893, with liabilities of $346,000,000.”+ though the House by its vote on • More than two hundred railway August 28 helped to restore confidence companies, representing fifty-six thouin the country's financial integrity. sand miles of track and one-fourth “ In December, 1893, the comptroller of the railway capital of the country,


went into the hands of receivers be* Richardson, Messages and Papers, vol. ix.,

tween 1892 and 1896.''1 pp. 401-405; Record, vol. xxv., p. 241 et seq.

“ Commercial failures alone in 1893 Record, p. 1008; Watson, American Coinage, pp. 170–176; J. F. Johnson, Money and Currency, were three times as numerous as those

of 1873 and the aggregate liabilities | Record, pp. 2958, 3065.

I Dewey, Financial History, pp. 444–446 ; Noyes, American Finance, pp. 197-199; White, Dewey, Financial Tistory, p. 446; Annual ReMoney and Banking, p. 208; Hepburn, Contest port of the Comptroller of the Currency, 1893, for Sound Money, pp. 372–373; Sherman, vol. ii., p. 80; Noyes, American Finance, p. 193 et seq.; pp. 1186–1196; Burton's Sherman, pp. 386–391 ; Lauck, Panic of 1893, p. 107. Whittle's Cleveland, pp. 158–164.

† Dewey, Financial History, p. 446. & See the Annual Supplement, The Commercial 1 Coman, Industrial History, p. 321 (edition of and Financial Chronicle, 1894, p. 2.


P. 356.

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