Recollections of Forty Years in the House, Senate and Cabinet Part 96

Among the bills pa.s.sed on this Congress was one introduced by Mr.

Blair, of New Hamps.h.i.+re, and chiefly advocated by him, to aid in the establishment and temporary support of common schools. It provided for the appropriation of $120,000,000 to be distributed among the states upon the basis of illiteracy, $15,000,000 for the current fiscal year, and a smaller sum each year for fifteen years, until the total sum was exhausted. The apportionment proposed would have given to the southern states $11,318,394 out of the $15,000,000. The money was not to be disbursed by the United States, but was to be placed in the hands of state authorities.

The object designed of diminis.h.i.+ng illiteracy in the south, especially among the freedmen, was no doubt a laudable one, but the measure proposed was so radical and burdensome, and so unequal in its apportionment among the states, that I a.s.sumed it would be defeated, but it pa.s.sed the Senate by a large majority. The advocates of a strict construction of the const.i.tution voted for it in spite of their theories. The bill, however, was defeated in the House of Representatives.

An interesting debate arose between Mr. Beck and myself, during this session, upon the question of the sinking fund, which he seemed to regard as a part of the public debt. It is, in fact, only a treasury statement of the debt to be paid each year, and the amount actually paid. In 1862, when the war was flagrant, Congress provided that one per cent. of the princ.i.p.al of the public debt should be paid each year as a "sinking fund." While the United States was borrowing large sums and issuing its bonds, it was folly to pay outstanding bonds, and this was not done until 1868, when the treasury was receiving more money than it disbursed. In the meantime, the treasury charged to the "sinking fund," annually, the sum of one per cent. of the amount of outstanding securities of the United States. When the receipts exceeded expenditures, so much of the balance on hand as was not needed was applied to the purchase of bonds, and such bonds were canceled and the amount paid was placed to the credit of this fund. In the general prosperity that followed, and until 1873, the sums thus credited increased so that the amount of bonds paid was equal to, if not in excess of, the annual charge against that fund, and the amount charged against it prior to 1868. When the financial panic of 1873 occurred, the revenues fell off so that they were insufficient to meet current expenditures. This prevented any credits to the sinking fund until 1878, when the pendulum swung the other way, and the fund was rapidly diminished by the bonds purchased from the surplus revenue, and credited to the fund, so that when Mr. Beck interrogated me I was able to say that the sinking fund had to its credit a considerable sum; in other words, the United States had paid its debt more rapidly than it had agreed to pay it. The term "sinking fund," as applied to the national accounts, is a misleading phrase. It is a mere statement whether we have or have not paid one per centum of the public debt each year. There is no actual fund of the kind in existence for national purposes.

Another financial question was presented at this session and before and since. The national banking act, when it pa.s.sed in 1863, provided that the circulating notes of national banks should be issued for only ninety per cent. of the amount of United States bonds deposited in the treasury for their security. At that time bonds were worth in the market about fifty per cent. in coin, or par in United States notes. Soon after the war, bonds advanced far above par in coin and have been worth thirty per cent. premium.

Yet, in spite of this, Congress has repeatedly refused to allow notes to be issued by national banks, to the par value of bonds deposited on security, thus limiting the amount of bank notes unreasonably. I introduced a bill early at this session to correct this. It pa.s.sed the Senate, but was ignored in the House. The same result has happened at nearly every Congress since, even when the bonds were so high as to deter the issue of bank notes when they were greatly needed.

During this session a delicate question arose whether a Senator could refuse to vote when his name was called, and he was present in the Senate. The Senate being so closely divided a few Senators might, by refusing to answer to their names, suspend the business of the Senate when a quorum was present. Mr. Bayard and myself agreed that such a practice would be a breach of public duty, which the Senate might punish. Senators may retire from the Chamber, but the Senate can compel their attendance. If a case should arise where a Senator, being present, and not paired, should, without good reason, refuse to vote, he should be censured. The increase in the number of Senators makes this question one of importance, but I hope the time will never come when it practically shall arise.

The Senate is properly a very conservative body, and never yields a custom until it is demonstrated to be an abuse. The committee on appropriations is a very important one. It is always composed of experienced Senators, who are careful in making appropriations, but there are appropriations which ought not to be referred to them. Their chief duty is performed in the closing days of the session, when all business is hurried, and they have little time to enter into details. They are entirely familiar with the great appropriations for the support of the government, and can best judge in respect to them, but there are other appropriations which ought to be pa.s.sed upon by committees specially appointed for specific duties, like that of the District of Columbia. No reason can be given why these appropriations should not be acted upon by such committees. It is true that the appropriation committee ought to simply report such sums as are necessary to carry into execution existing laws. That is their function, according to the rules, and that function they can perform very well in regard to such expenditures; but the expenditures of the government for the District, rivers and harbors, fortifications, pensions, and certain other objects, are not defined or regulated by law. In the case of the District of Columbia, a few officers named in the appropriation bill are provided for by law, but the great body of the expenditures is for streets, alleys and public improvement, nine-tenths of all the appropriations made for the District being, in their nature, new items not fixed by existing law.

On the 6th of May, 1884, the country was startled by the failure of the Marine National Bank of New York, an inst.i.tution that had been in high credit and standing. The circ.u.mstances connected with the failure excited a great deal of interest and profound surprise.

Immediately in connection with the failure of this bank the banking firm of Grant & Ward, in the city of New York, failed for a large amount. Their business was complicated with that of the Marine National Bank, and disclosures were made which not only aroused indignation but almost created a panic in the city of New York.

Almost contemporaneous with this the insolvency of the Second National Bank of New York, for a very large sum, became public, and the alleged gross misconduct of the president of that bank, John C. Eno, became a matter of public notoriety. Steps were taken by the officers and stockholders of the bank, including the father of the president, to relieve it from bankruptcy.

Also, and in connection with the failure of the Marine National Bank, there were disclosed financial operations of a strange and extraordinary character of the president of that bank, James D.

Fish. All these events coming together caused much excitement and disturbance in New York. They led to a great fall of securities, to a want of confidence, and to a general run, as it is called, upon banks and banking inst.i.tutions, including the savings banks.

It appeared as if there were to be a general panic, a financial revulsion, and wide-reaching distress.

At that time also, and in connection with the other events, came the temporary suspension of the Metropolitan National Bank, one of the oldest, largest, and in former times considered among the best, of all the banks in the city of New York. This was partly caused by rumors and stories of large railroad operations and indebtedness of Mr. Seney, the president of the bank, which resulted in a gradual drawing upon the bank.

At once the Secretary of the Treasury did what he could to relieve the money market, by prepaying bonds which had been called in the process of the payment of the public debt; but the princ.i.p.al relief given to the market at that time was the action of the Clearing House a.s.sociation of New York, by the issue of over $24,000,000 of clearing house certificates. This was purely a defensive operation adopted by the a.s.sociated banks of New York, fifteen of which are state inst.i.tutions and the balance national banks.

All that was done in New York to prevent a panic was done by the banks themselves. The government of the United States had no lot or parcel in it except so far as the Secretary of the Treasury prepaid bonds that had already been called, a transaction which has been done a hundred times. So far as the government was concerned it had nothing to do with these banks; the measures of relief were furnished by the banks themselves.

This condition of financial affairs led to a long debate in the Senate, commencing on the 17th of June, on the merits and demerits of the system of national banks, and especially of the clearing house of the city of New York. The comptroller of the currency had taken active and efficient measures to protect the interests of the United States. He was called before the committee on finance and gave a full statement of these measures. It was apparent that the temporary panic grew out of the reckless and criminal conduct of a few men and not from defects in the national bank system or the clearing house. The debate that followed, in the Senate, was mainly between Morgan, Beck and myself. I stated fully the methods of conducting the business of the clearing house, a corporation of the State of New York, and closed as follows:

"As the prosecution against John C. Eno is now pending in Canada, a foreign country, as a matter of course no one can state what will be the result of it. We only know that proper legal proceedings are now being urged to have an extradition, and if he is brought within the jurisdiction of the courts as a matter of course the prosecution can then be pushed. So with James D. Fish. Indictments have been had and are now pending against him for a violation, not only of the national banking act, but I believe also for a violation of the state law; and the same is to be said of Ferdinand Ward.

These three persons are the only ones who have been charged with fraudulent and illegal transactions leading to these financial disasters. The Metropolitan bank, thanks to the agency and the aid that was given in a trying time, in now going on and doing business as of old, no doubt having met with large losses.

"It is a matter of satisfaction that with the single exception of the Marine Bank, of New York, no national bank has been overwhelmed by this disaster. It is true that the Second National Bank was bankrupted by the crimes and wrongs of John C. Eno, but his father, with a sensitive pride not to allow innocent persons to suffer from the misconduct of his son, with a spirit really worthy of commendation, here or anywhere else, threw a large sum of money into the maelstrom and saved not only the credit of the bank and advanced his own credit, but to some extent, as far as he could at least, expiated the fault, the folly, and the crime of his son. The Metropolitan Bank is relieved from its embarra.s.sments by its a.s.sociate banks.

The losses caused by the speculations of its president did not entirely fall upon the bank. That bank, now relived from the pressure of unexpected demands, is pursuing its even tenor. It seems to me that all these facts taken together show the strength and confidence that may well be reposed in the national banking system. The law cannot entirely prevent fraud and crime, but it has guarded the public from the results of such offense far better than any previous system."

On the 10th of May, 1884, which happened to be my birthday, the statue of John Marshall, formerly Chief Justice of the United States, was dedicated. This is a bronze statue in a sitting posture, erected by the bar of Philadelphia and the Congress of the United States. A fund had been collected shortly after the death of Marshall, but it was insufficient to erect a suitable monument, and it was placed in the hands of trustees and invested as "The Marshall Memorial Fund." On the death of the last of the trustees, Peter McCall, it was found that the fund had, by honest stewards.h.i.+p, increased sevenfold its original amount. This sum, with an equal amount appropriated by Congress, was applied to the erection of a statue to the memory of Chief Justice Marshall, to be placed in a suitable reservation in the city of Was.h.i.+ngton. The artist who executed this work was W. W. Story, a son of the late Justice Story of the Supreme Court. I was chairman of the joint committee on the library and presided on the occasion. Chief Justice Waite delivered an appropriate address. He was followed by William Henry Rawle, of Philadelphia, in an eloquent oration, closing as follows:

"And for what in his life he did for us, let there be lasting memory. He and the men of his time have pa.s.sed away; other generations have succeeded them; other phases of our country's growth have come and gone; other trials, greater a hundredfold than he or they could possibly have imagined, have jeoparded the nation's life; but still that which they wrought remains to us, secured by the same means, enforced by the same authority, dearer far for all that is past, and holding together a great, a united and happy people. And all largely because he whose figure is now before us has, above and beyond all others, taught the people of the United States, in words of absolute authority, what was the const.i.tution which they ordained, 'in order to form a perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to themselves and their posterity.'

"Wherefore, with all grat.i.tude, with fitting ceremony and circ.u.mstance; in the presence of the highest in the land; in the presence of those who make, of those who execute, and of those who interpret, the laws; in the presence of those descendants in whose veins flows Marshall's blood, have the bar and the Congress of the United States here set up this semblance of his living form, in perpetual memory of the honor, the reverence and the love which the people of this country bear to the great chief justice."

During this session Mr. Ingalls offered to a House bill granting a pension to soldiers and sailors of the Mexican War, the following amendment:

"That all pensions which have been or which may hereafter be granted in consequence of death occurring from a cause which originated in the service since the 4th day of March, 1861, or in consequence of wounds or injuries received or disease contracted since that date in the service and in the line of duty, shall commence from the death or discharge of the person on whose account the claim has been or is hereafter granted, if the disability occurred prior to discharge, and if such disability occurred after the discharge, then from the date of actual disability, or from the termination of the right of the party having prior t.i.tle to such pension."

I opposed this sweeping provision with much reluctance, as I have always favored the granting of the most liberal pensions consistent with the public interests. I said:

"I regret very much to oppose any proposition that is favored by the Union soldiers of the American army; and I perhaps should feel some hesitation in doing it, only that I know very well that the soldiers themselves, like all other citizens, are divided in opinion as to this measure.

"This proposition repeals all restrictions as to time upon applications to be made for arrears of pensions, and extends to all persons back to the war or date of discharge or disability, not only of those who have heretofore applied, but of those who may hereafter apply.

It removes absolutely all restrictions upon the applications for arrears of pensions. And if this only involved ten or even twenty million dollars, I might still hesitate, because I have always, since the close of the war, voted for every measure that has been offered in good faith for the benefit of the Union soldiers. My heart, my feelings are all with them. I appreciate the value of their services, the enormous benefits they have conferred upon the people of the America for generations yet unborn, and I hesitate therefore to oppose any wish that they may express through their organs.

"This measure involves an immense sum of money. That alone would not be conclusive. But here is a motion made by a Senator, without the report or sanction of any committee of this body, to put upon the people of the United States a great demand, ranging anywhere up to $246,000,000, a proposition so indefinite in character that the commissioner of pensions is utterly unable to give us any approximate estimate, but gives his guess as near as he can. He says that this proposition will involve the expenditure of $246,000,000."

Mr. Ingalls made a st.u.r.dy effort for his amendment, and quoted a declaration of the Republican national convention in favor of arrears of pensions, to which I replied that, when I remembered that the platform of the last Republican convention had been made up in a few hours, on a sweltering hot day, by forty-two men hastily called together, most of whom never saw each other before, I did not think it ought to be taken as a guide for Senators in the performance of their public duties.

After full discussion the amendment was rejected.

My position was highly commended by the public press and by many distinguished soldiers, including Governor Foraker, who wrote me, saying: "It may be some gratification to you to know that your course, in regard to the pension bill, meets with the earnest approval of all right-minded men in this part of the state."

On the 3rd of July the following resolution was adopted by the Senate on my motion:

"_Resolved_, That the Senate will meet at the usual hour on Friday, the 4th day of July instant, and, after the reading of the journal and before other business is done, the secretary of the Senate shall read the Declaration of American Independence."

On introducing the resolution, I said:

"Never till during our Civil War, so far as the records show or as is known or is recollected, did Congress meet on the 4th of July.

During the Civil War we did meet habitually on the 4th of July, but it was only on the ground that those who had control then believed that the business then requiring attention was proper to be done on the 4th of July. We have only met once since on the 4th of July, and that was in 1870, at a time of great political excitement. An effort was made to adjourn when the Senate met that day, but the session was continued--a long, exciting, and unpleasant session--on the 4th of July, 1870.

"I do not doubt that to-morrow it will be well to sit, because the committees of conference are carrying on their business and I have no objection to sitting; but I think we ought to recognize, by common consent, the importance of the day and the fact that it is a national anniversary celebrated all over the United States, by reading that immortal paper which is the foundation of American independence."

Congress adjourned July 7, 1884.

CHAPTER XLVII.

MY PARTIc.i.p.aTION IN THE CAMPAIGN OF 1884.

Again Talked of as a Republican Candidate for the Presidency--I Have no Desire for the Nomination--Blaine the Natural Candidate of the Party--My Belief that Arthur Would be Defeated if Nominated-- Speech at Was.h.i.+ngton, D. C., for Blaine and Logan--Opening of the Ohio Campaign at Ashland--Success of the Republican State Ticket in October--Speeches in Boston, Springfield, Ma.s.s., New York and Brooklyn--Address to Business Men in Faneuil Hall--Success of the National Democratic Ticket--Arthur's Annual Message to Congress-- Secretary McCulloch's Recommendations Concerning the Further Coinage of Silver Dollars--Statement of My Views at This Time--Statue to the Memory of General Lafayette--Controversy Between General Sherman and Jefferson Davis.

On the 3rd of June, 1884, during the session of Congress, the national Republican convention to nominate Republican candidates for President and Vice President, was held at Chicago. Prior to that time the papers had been full of the merits and demerits of candidates, and my name was mentioned among them. I had early announced, in interviews and letters, that I was not a candidate.

The following statement was generally published in Ohio:

"I am in no sense a candidate, and would not make an effort for the nomination. I would not even express my opinion as to who should be delegates from my own district or what their action should be. Four years ago I thought it best to be a candidate. I believed that the logic of events at that time justified such action. The reasons I need not state. Now there is no such condition and I would not enter a contest even for the indors.e.m.e.nt of my own const.i.tuency. Many of my friends write me complaining letters because I refuse to make such an issue. Believing that the convention, when it meets, should be free, uninstructed, and in shape to do the very best thing for the whole party, I have counseled by friends to that end. A united and enthusiastic party is more important than one man, and hence I am for bending every energy to the first purpose, and am not a candidate."

I had not expressed the slightest desire to make such a contest.

When approached by personal friends I dissuaded them from using my name as a candidate. I neither asked nor sought anyone to be a delegate. When the convention met, the Ohio delegation was divided between Blaine and myself, and this necessarily prevented any considerable support of me outside of the state. I was not sorry for it. I regarded the nomination of Blaine as the natural result under the circ.u.mstances.

The strength of Arthur, his princ.i.p.al compet.i.tor, grew out of his power and patronage as President. He was a gentleman of pleasing manners, but I thought unequal to the great office he held. He had never been distinguished in political life. The only office he had held of any importance was that of collector of the port of New York, from which he was removed for good causes already stated.

His nomination as Vice President was the whim of Roscoe Conkling to strike at President Hayes. If nominated he would surely have been defeated. In the then condition of political affairs it is not certain that any Republican would have been elected.

The weakness of the nomination of Blaine was the strong opposition to him in the State of New York. The selection by the Democratic convention of Grover Cleveland as the candidate for President, and of Thomas A. Hendricks for Vice President, was made in view of the necessity of carrying the two doubtful States of New York and Indiana, which it was well understood would determine the election.

I promptly took an active part in support of the Republican ticket.

A meeting to ratify the nomination of James G. Blaine and John A.

Logan was held at Was.h.i.+ngton, D. C., on the 19th of June, at which I made a speech, which, as reported, was as follows:

"It is one of the curious customs of American politics that when anybody is nominated for office, his compet.i.tors are the first to be called upon to vouch for the wisdom of the choice. Perhaps that is the reason I am called upon now. Though I did not consider myself as much of a candidate, I am ready to accept, approve and ratify the action of the Chicago convention. I will support the nomination of Blaine and Logan as heartily as I have done those of Fremont and Lincoln and Grant and Hayes and Garfield. And this I would do, fellow-citizens, even if they were less worthy than I know them to be of the distinguished honor proposed for them. I would do it for my own honor. I have no patience with any man who, for himself or any other person, would take his chances for success in a political convention, and when disappointed would seek to thwart the action of the convention. Political conventions are indispensable in a republican government, for it is only by such agencies, that opposing theories can be brought to the popular judgment. These can only be presented by candidates chosen as standard bearers of a flag, or a cause, or a party.

"That Blaine and Logan have been fairly nominated by the free choice of our 800 delegates, representing the Republicans of every state, county and district in the broad extent of our great country, is admitted by every man whose voice has been heard. They are not 'dark horses.' Their names are known to fame; the evil and good that men could say of them have been said with a license that is a shame to free discussion. Traveling in peace and in war through the memorable events of a quarter of a century, they have kept their place in the busy jostling of political life well in the foreground. And now they have been selected from among millions of their countrymen to represent--not themselves, but the Republican party of the United States.