THE BREVIER LEGISLATIVE REPORTS.
TENTH VOLUME.
INDIANA LEGISLATURE.
IN SENATE.
WEDNESDAY, February 3,1869.The Senate met at nine o'clockthe Lieutenant Governor in the Chair.
The journal of yesterday was read.
PETITIONS ETC.
Described as follows were presented and referred to appropriate committees:
By Mr. STEIN: Against the consolidation of railroads.
By Mr. BRADLEY: For legislation to protect minks and other fur-bearing animals.
By Mr. CAVEN: For amendments to the gravel road law.
By Mr. HADLEY and Mr. CAVEN: For the repeal of the same.
AGRICULTURAL COLLEGE LOCATION.
Mr. HADLEY offered the following:
WHEREAS, It appears upon the 387th page of the BREVIER LEGISLATIVE REPORTS for 1867, that ex Senator Mason stated, upon this floor, that the Commissioners of Hancock county had proposed to donate to the State of Indiana the sum of one hundred and twenty-five thousand dollars, to secure the location of the Agricultural College at Greenfield, or some other point in that county: therefore be it
RESOLVED, That a committee of three be appointed to inquire if said statement was correct, and if said proposition was made, whether the same is now, or will be renewed.
Mr. STEIN resisted the adoption of the resolution, because of the delay, etc., which would ensue.
Mr. HADLEY gave reasons why it should adopted, and argued that it would not cause delay.
The resolution was adopted.
The LIEUTENANT GOVERNOR subsequently appointed Messrs. Hadley, Caven and Johnson of Montgomery said Committee.
NATIONAL FINANCES.
Mr. FISHER, from the Special Joint Committee on the National Finances, returned the joint resolution [S. 6] instructing our Senators, and requesting our Representatives in Congress, to use their influence to procure the passage of an act of Congress authorizing the Secretary of the Treasury of the United States to receive coupons of United States bonds in payment of import duties, and permitting such coupons to be so received in advance of their coming due, recommending that it lie on the table.
Mr. CAVEN moved to make it the special order for half-past two o'clock this afternoon.
The motion was agreed to.
On motion by Mr. SCOTT his twenty-third Judicial Circuit bill, [S. 55]the special order for this morning,was made the special order for half-past two o'clock p. m. to-morrow.
Mr. GRAY, from the Committee on Corporations, returned the bill, [S. 90] amending the act for the incorporation of cities, recommending its passage.
The report was concurred in.
Mr. FISHER offered a concurrent resolution that the Trustees of the Northern Penitentiary pay to Louisa R. Skinner one hundred and twenty-two dollars and sixty-four cents, being the salary of her husband from his death to the time of the appointment of his successor as moral instructor of that institution.
Mr. FISHER explained why this resolution should be passed. The reverend gentleman was generous to a fault when a Chaplain in the army, and this would be a considerable relief for the worthy widow of a worthy man.
The resolution was adopted.
page: 242[View Page 242]BILLS FOR ACTS
Were introduced, read the first time and referred to appropriate committees, viz:
By Mr. BRADLEY, [S. 164] to authorize the amendment of a bill of exceptions in certain cases.
By Mr. DENBO, [S. 165] to authorize boards of County Commissioners to relieve sureties on the bonds of any county officer, on petition of a majority of the voters of said county.
By Mr. CRAVENS, [S. 166] providing for the establishment of election precincts.
By Mr. JAQUESS, [S. 167] to amend section four of the act for the incorporation of manufacturing and mining companies.
By Mr. ROBINSON, of Madison, [S. 168] to authorize turnpike and gravel road companies hereafter organized to increase their capital stock, etc.
Also, [S. 169] authorizing common councils of incorporated cities to act as school trustees of such cities.
By Mr. LASELLE, [S. 170] to revise and amend section thirteen of the act of June 1, 1852, for the organization of Circuit Courts, election of judges, etc.
By Mr. SCOTT, [S. 171] to amend the plank, McAdam and gravel road law of May 12, 1862, [regulating rates of toll.]
By Mr. CAVEN, [S. 172] to exempt burial grounds from lien or sale on execution or other process.
By Mr. CAVEN, [S. 173] to change the corporate name of the Widows' and Orphans' Asylum of Indianapolis.
By Mr. WOLCOTT, [S. 174] to provide for the measurement of ear corn and hay in bulk.
COIN CONTRACTS AND THE CURRENCY.
Mr. WOLCOTT, from the special joint Committee on Finances, made the following report;
Mr. PRESIDENT: The Special Joint Committee, to whom was referred certain Resolutions relative to the National Finances, with instructions to report what, in the opinion of the Committee, the National credit and the interests of the people of this State require, respectfully beg leave to report that they have earnestly considered the subject referred to them; and, in view of the general situation of the interests involved in the inquiry, with the legislation pending in the Congress of the United States affecting the same, propose and recommend the passage of the following Joint Resolution No. 10.
BE IT RESOLVED by the General Assembly of the State of Indiana, That our Senators in Congress be instructed, and our Representatives requested, to oppose by their influence and votes the passage of any bill that shall specially legalize coin contracts, until the United States shall redeem its Treasury Notes in coin; and to oppose the enactment of any law which shall have the effect to reduce the present volume of the paper money in use among the people of the United States.
The report was concurred in.
Mr. GRAY, from the Corporations Committee, returned the bill, [S. 54] empowering cities to establish public parks, recommending its passage.
The report was concurred in.
The LIEUTENANT GOVERNOR laid before the Senate a communication from the Auditor of State, exhibiting the expenses of the State prisons, as required by a resolution of the Senate.
It was referred, without reading, to the Committee on Prisons.
Mr. WOLCOTT said it was important that the joint resolution [S. 10] just introduced by the joint Committee on Finance be passed at once, if at all, and on his motion the order of business was suspended for that purpose.
A constitutional provision requiring the yeas and nays, they were taken and resulted--yeas 30, nays 6.
Pending the roll call--
Mr. LASELLE, when his name was called, announced that he was in favor of enforcing gold contracts, but opposed to contracting the currency, and consequently would vote in favor of the passage of the resolution, as he regarded the latter provision more important and necessary than the first.
So the resolution was adopted.
SENATE BILLS ON THE SECOND READING.
Mr. Green's bill [S. 20] to tax costs in cases where guardian and executor sureties shall desire to be released from bonds, coming up in regular order, it was read the second time with a committee amendment thereon declaring an emergency.
The amendment was agreed to and the engrossment of the bill ordered.
Mr. Beardsley's bill [S. 27] authorizing the Bristol Hydraulic Company to erect and maintain a dam across the St Joseph river, was read the second time and ordered engrossed for the third reading.
Mr. Scott's bill [S. 35] in relation to docket fees, was read the second time and ordered engrossed.
APPEALS TO THE SUPREME COURT.
Mr. Scott's bill [S. 41] relating to appeals to the Supreme Court, was read the second time.
Mr. BRADLEY moved to indefinitely postpone the bill.
Mr. GREEN explained the object of the bill. The law now provides that no case shall be appealed to the, Supreme Court where the amount involved is less than ten dollars. This bill proposes to increase the amount to one hundred dollars. He did not altogether like the theory of it. If it could be amended so as to place the amount at twenty-five or thirty dollars, he might vote for it. The object is to diminish the work of the Supreme Judges, but he believed the principle was wrong, and that page: 243[View Page 243] this amendment would cut down the cases fully one-half.
Mr. BRADLEY thought it should not be so limited. A case might involve the title to land or questions of importance, but unless the amount involved should be one hundred dollars, an appeal could not be taken under this bill.
The motion to postpone was agreed to by yeas 21, nays 14.
PLEADINGS IN CIVIL CASES.
Mr. Bradley's bill [S. 43] to facilitate the making up of civil actions was read the second time.
Mr. SCOTT moved that the bill be indefinitely postponed. It proposed to introduce a system of practice which he thought could not prevail in the State. Our circuits are so large, that a judge would have to carry his onus around with him, in his hat, or, like a country Justice of Peace, take his docket with him when he went out hunting or to cut wood. He believed it impossible to put the system into successful practice upon so small a bill as this, and that a great many imperfections would be found to exist in it. The dockets would be filled every term with motions to set aside entries made by the Clerk in vacation. It might work if there was but one Court in a county, so that the Judge could come in every morning, or twice a week, even, to decide upon pleadings filed. Under the present system he believed it would have a tendency to increase, rather than diminish costs. The object of the bill seems to be a good one, but it is so imperfect that he could not vote for it.
Mr. BRADLEY declared that this bill was prepared by two of the best lawyers in the State of Indiana, and he was understood to say he hoped this motion to postpone was not made to retaliate on him for making a similar motion, when the bill of the Senator was up a few minutes since. He then gave reasons why this bill should pass, and attempted to show that the objections urged against it were entirely groundless. He said the Senator from Vigo [Mr. Scott] was mistaken in regard to the judge having to carry his docket around with him in his hat. There is no requirement for disposing of a pleading, judically, during vacation, unless by agreement of parties. It simply provides for filing pleadings within a certain time, and if it is such a pleading as requires a response, requiring that to be filed within a certain time. The Clerk has no judicial authority whatever, beyond entering up a default.
Mr. SCOTT asked who was to be the judge, if not the Clerk, whether the proper notice had been served.
Mr. BRADLEY replied that the face of the papers would show this fact.
The motion to indefinitely postpone was rejected by yeas 18, nays 18the Lieutenant Governor giving the casting vote in the negative.
The bill was ordered engrossed for the third reading.
STATE LANDS IN INDIANAPOLIS.
Mr. Caven's bill [S. 49] to authorize the city of Indianapolis to occupy part of the State lands in Indianapolis was read the second time.
Mr. SCOTT moved to amend by inserting these words: "But such possession and use shall not amount to, or ever be converted into a title to said city, but the possession may be at any time resumed by the State, and the State shall never be liable for any improvement upon the same by the city."
Mr. GREEN said that this bill had been carefully considered in committee. They had examined the grounds, and found them to be of comparatively little use to anybody in their present condition. Mr. Mclntyre, Superintendent of the Deaf and Dumb Asylum, had planted out one of the tracts referred to in corn, and should have got 700 bushels but got less than 100, the rest having been carried away. He had tried planting potatoes with the same result. It would certainly be better to have it occupied by the city, properly enclosed and beautified.
Mr. TURNER said that he was a member of the committee, but had been absent and unwell. By way of entering his protest against the report made, he would now move the indefinite postponement of the bill.
Mr. FISHER was glad the Senator had made the motion. If the State does not need the land, it is valuable and should be sold, so that the money could be used. If it once passed from the possession of the State to that of the city it would be equivalent to a conveyance. He opposed the bill, because he regarded it in the light of a conveyance, of the property named, to the city.
Mr. CAVEN said that the purport of the bill was not understood, or there certainly could be no objection to it. It is specially provided that the city shall inflict no injury upon the property, and that it shall be surrendered back at any moment. He disclaimed any intention to involve in doubt the right of the State to the grounds, and explained that the bill contemplated simpler making the grounds ornamental--the State to take them when it chooses. He was willing to have incorporated in the bill the very strongest language, and instead of making the State liable for improvements made, he was willing to insert a contrary proviso that the city should be liable for any damage done.
Mr. CRAVENS said the committee on the page: 244[View Page 244] Gubernatorial mansion had under consideration the propriety of building on a piece of ground named in the bill, and if it passed the Committee would be circumscribed in its action therefore he should vote for the motion to indefinitely postpone the bill. If not used, he was in favor of selling the land. It is not necessary that the State should own so much land about this city. There was a large part of the farm at the Insane Asylum that he would be in favor of disposing of, as it was of no use to the State. He was surprised that the city did not ask to use that also.
Mr. KINLEY was also in favor of selling the land if it was not needed. But if not sold, he thought there could be no objection to have it occupied and improved. He was not in favor of indefinitely postponing the bill, and when the Governor's residence question is disposed of, we may desire to take it up. In order that this might be done, he moved to lay it on the table.
The motion was agreed to.
BILLS ON THE SECOND READING.
Mr. Wolcott's bill, [S. 92] to prescribe the length of terms of Courts in Jasper and Newton counties, was read the second time.
On motion by Mr. STEIN it was referred to the Committee on Organization of Courts, which has a similar bill in its possession.
Mr. Howk's bill, [S. 93] to regulate the practice of reading, making and signing records of Courts of Common Pleas, was read the second time, and ordered engrossed.
Mr. Cravens' bill, [S. 94] touching the consolidation of railroads, and declaring the effect of said consolidation, was read the second time.
On motion by Mr. CRAVENS, it was made the special order for half-past three o'clock this afternoon.
Mr. Bradley's bill, [S. 95] to amend section three hundred and three of the general practice act, was read the second time, and ordered engrossed for the third reading.
Mr. Wood's bill, [S. 96] prohibiting judges, clerks, auditors, sheriffs, treasurers and recorders from practising law in the courts of this State, was read the second time, and ordered engrossed for the third reading.
Mr. Green's bill, [S. 98] to provide for assessment of taxes on bank stock for municipal purposes, was read the second time and ordered engrossed.
VETO MESSAGE.
The LIEUTENANT GOVERNOR laid before the Senate, Senate bills Nos. 41 and 47 of last session, with the vetoes of the Governor, filed with the Secretary of State after the close of the session. [See BREVIER LEGISLATIVE REPORTS, volume IX, pp. 3, 4, 5 and 6.]
They were referred to the Committee on Corporations.
On motion by Mr. Gray, his bill, [S. 85] was recommitted to the Committee on Corporations.
U. S. DISTRICT COURT.
The hour having arrived for the consideration of the joint resolution [S. 9,] introduced yesterday requesting the Indiana delegatiod in Congress to use their influence to secure the establishment of a Southern District Court in this State, and locate it at Evansville, it was taken up.
The question being on the pending amendment, striking out the word "Evansville" and inserting in lieu "South-Bend"--
Mr. BRADLEY moved to amend the amendment by striking out "southern" and inserting in lieu "northern."
Mr. CHURCH accepted the amendment.
Mr. CARSON moved to lay all the proposed amendments on the table, except the word Northern.
Mr. BRADLEY would consent to this, and to leaving the name of the place blank.
Mr. CHURCH moved to refer the whole subject to the Committee on the Organization of Courts.
Mr. HUGHES hoped it would not be so referred. Senators could decide now whether they wanted another such court, and whether North or South. He did not see what that committee had to do with such a matter. He was in favor of voting upon this simple proposition at once, and getting it out of the way.
Mr. GRAY concurred with the remarks of the Senator from Monroe [Mr. Hughes.] The question is a very simple one. He supposed if another court was created, another United States Marshal would be required, and he was opposed to the creation of any more offices.
Mr. HANNA said there was uo doubt they felt the need of such a bill all along the Ohio river. Under a decision of the Supreme Court of the United States, the District Courts have exclusive jurisdiction of all cases in admiralty, and all in which the owners of steamboats are parties, It might be well to petition Congress for a sensible decision, which should not extend the admiralty jurisdiction over every little inland creek and bayou. He was opposed to striking out Southern and inserting Northern.
Mr. MORGAN said his people were very anxious to have the Court established at Evansville. If the people in the north part of the State want another one, let them get it, if they can. He claimed for Evansville that it was the leading commercial city of the State, and the second in population.
Mr. CARSON asked what their population amounted to.
page: 245[View Page 245]Mr. MORGAN replied that it was estimated at thirty thousand some time since, and there could be no doubt that it amounts to that now, It is a better business place now than during the war. Several business men had gone to Cincinnati, but found that Evansville was a better business place and returned. They are competing largely with Cincinnati, Louisville and St. Louis in their wholesale trade. Kentucky has two District Courts, Ohio two and seeking a third, and he did not see why Indiana should not have two or three; but if only two, one of them should be at Evansville.
Mr. CRAVENS was in favor of the general proposition, and was for coming to a direct vote. With a view of dividing the question,settling the main idea first and the point of location second, he moved to lay the motion to refer on the table.
The motion was agreed to.
Mr. WOLCOTT offered a substitute to provide for two district courts in the State, a northern and southern one, in lieu of the present one at Indianapolis, one to be located at Logansport and the other at Evansville.
Mr. BRADLEY moved to amend by striking out the two places named, leaving Congress to make the location.
Mr. WOLCOTT accepted.
Mr. HANNA said they could not get at it by this sort of legislation. The United States have already an expensive building here, and would not remove the Court from here. We must fix upon the place for the second Court, or it would not be fixed at all.
Mr. HUGHES apprehended that no one would attempt to deprive the capitol of the State of a United States District Court; and said that the proposition pending before the Senate is not in the right shape. The question is, whether we are to have an additional court, first, and then where it is to be. If it is left to Congress, each member will want it in his own district, and it will never be decided. He thought there was no question, if another was wanted, that Evansville was the place for it. It is a great business place, and the first commercial city in the State. With all the admirality cases coming up along the river, there is no place which has more need of it. He would vote against any other city than Evansville, and if we are reasonable in our request to Congress we are likely to get one established there.
Mr. LASSELLE was in favor of locating these courts in the Northern and Southern portions of the State. If in the Northern part Logansport was the point, and if the Southren part Evansville was the place. Unless the substitute was adopted, or something similar, he should oppose the proposition to locate at Evansville or elsewhere.
Mr. CRAVENS had no desire to speak upon the question, but insisted that no other motion was in order until his own was wholly disposed of; by dividing the question first as to whether the Senate will petition for another court.
The LIEUTENANT GOVERNOR decided that the substitute took precedence.
Mr. CRAVENS moved to lay it upon the table.
The motion was agreed to.
Mr. LASSELLE moved to refer the whole matter to a special Committee of one from each Congressional District.
Mr. MORGAN thought there was no necessity for referring it; the matter was well understood now.
Mr. HUGHES called the attention to the length of the river border, and the number of towns and cities located upon it.
Mr. LASSELLE did not think it a subject that required hasty action. A Committee could consider the wants of each section of the State.
Mr. SCOTT was opposed to such a reference. If it went to any committee, the one on Federal Relations was the one, if there was any use for the committee. He moved to amend by changing the reference to that committee.
This motion was agreed to.
Mr. STEIN thought this would be simply wasting time, as this ground would all have to be gone over again when it came from the committee. He thought it was useless to speak of removing it from here. The main proposition is whether we shall petition Congress for another district; and, secondly, where the court should be located. He would oppose anything looking to a removal of the court from Indianapolis. He desired a direct vote on the question.
The amended motion to refer was rejected.
Mr. BIRD demanded the previous question.
The demand was seconded by the Senate.
The preamble was adopted.
The first part of the resolution was adopted.
The latter branch of the resolution, locating the court, was also adopted.
The constitutional provision demanding the yeas and nays on the passage of the joint resolution, they were ordered, and being taken, resulted, yeas, 32; nays 3.
Pending the roll call--
Mr. SHERROD, in explanation, said he voted "no" from the fact of the location of Evansville, it being at the extreme end of the State. He favored New Albany as the most eligible point in the Southern part of the State, not only because of its geographical position, but for many other reasons.
So the joint resolution passed the Senate.
Mr. Howk's bill, [S. 110] to locate the 24th Judicial Circuit, was read the second time.
page: 246[View Page 246]On motion of Mr. CAVEN, the bill was passed over till the author returned.
Mr. Howk's bill, [S. 119] fixing the times of holding the courts in the fourth Common Pleas District, was read the second time and ordered to be engrossed for the third reading.
The Senate took a recess till two o'clock p. m.
AFTERNOON SESSION.
The LIEUTENANT GOVEENOE called the Senate to order at two o'clock.
Mr. KINLEY, by leave, presented a petition praying for the establishment of suitable prisons for women.
It was referred to the Committee on Prisons.
REPORTS FROM COMMITTEES.
Mr. GRAY, from the Committee on Corporations, returned the bill, [S. 53] to authorize co-operative societies for the purpose of erecting buildings, etc., recommending that it be laid on the table.
Also, the bill, [S. 109] to amend section seven of the act providing compensation for the killing of animals by railroads, recommending its indefinite postponement.
Also, the bill, [S. 91] to amend section 2 of the railroad assessment act, recommending that it be laid on the table.
These reports were severally concurred in.
The House concurrent resolution looking to the erection of a monument over the remains of General Pleasant A. Hackleman, by the appointment of a joint committee to indicate the ways and means; coming up in order, and being read--
The resolution was concurred in, and the Lieutenant Governor appointed Messrs. Eliott, Fisher, Stein and Henderson the committee on the part of the Senate.
Mr. Beardsley's bill [S. 123] to amend section 17 of the act of June 17, 1852, for the organization of County Boards, was read the second time, with the committee's amendment thereto.
The amendment was agreed to, and the bill was ordered to be engrossed for the third reading.
THE NATIONAL FINANCES.
The hour for the consideration of the joint resolution [S. 6] concerning the receipt by the United States Treasurer of United States bond coupons for payment of duties, etc., having arrived, [see pages 172 and 173]--
Mr. CAVEN said:
Mr. PRESIDENT--The war for the preservation of the Union having ended, and reconstruction well advanced, public attention is centering upon questions of national finance.
The war necessarily involved the creation of a large debt, and while it cannot be paid or disposed of by Legislative resolutions, and while the great and ultimate remedies are industry, economy and final honest payment, yet no doubt judicious statesmanship can do much to alleviate the burden. Prominent among the financial questions of the day is the problem of "How to return to specie payment."
It is almost universally regarded as important to return as soon as practicable to a specie basis, placing the paper currency of the country for commercial uses upon an equality with gold, and relieving the nation of two classes of money values, and carrying many important results in its train.
Gold is the recognized currency of the world, and is the true standard of values amongst all the civilized nations of the earth. We speak of gold commanding a premium, when correctly speaking it should be said that the paper currency of the country is at a discount.
Prior to the war, gold and the paper of solvent banks were accepted as equal for commercial uses, or so nearly so as to be inappreciable in effect: and when gold and silver were the only legal tender, and when every holder of bank bill and every creditor could demand the gold, yet it was rarely done.
All history teaches that upon the outbreak and during the continuance of a war, gold rapidly advances to a premium as compared with paper, and such was the result in this country during our recent civil war. In times of alarm, of danger and uncertainty, each one seeks to secure his wealth condensed into small bulk so as to be readily concealed or removed, and available anywhere in the world in the event of necessary fight.
Gold has an intrinsic value which no accident, national misfortune or unwise legislation can destroy. Gold is its own ultimate and absolute security. The gold coined by a nation would be as valuable if the nation that coined it were blotted from the face of the earth as it stood in the front rank of firmly established nations, while paper money is merely a promise to pay gold, and its real value is dependant upon the ability of the obligor to redeem it, and its commercial value is dependent upon the confidence of community in that ability. It is, however, true that when the Government makes its own paper issues a legal tender, such paper, for all business uses, becomes money, as nothing else can be collected for a debt by process of law.
The peculiar causes for the depreciation of our United States notes were several:
- --A want of confidence in the stability of the Government; in its ability for self-preservation; and even if preserved; in its ultimate ability to redeem its paper issues.
- --A sudden expansion of the paper page: 247[View Page 247] currency governed by no fixed law of supply, the Government being able to supply in unlimited quantities and liable to do so to meet the great exigencies of a war involving our national existence.
- --The demand for gold for export to make good the balance of trade against this country by reason of an excess of imports over exports.
- --The demand for gold to pay duties on imports, necessarily made payable in gold in order to procure the means wherewith to pay the interest on the public debt.
These, then, are the causes why gold is at a premium, and in order to arrive at a specie basis it will be necessary to remove these four causes and the question is: "Can it be accomplished by legislation?"
During times of excitement and alarm, whilst the condition of war existed and its termination uncertain, all legislation to prevent, regulate or control fluctuations in gold premium was found to be worse than useless, almost always resulting in increasing the evil it was intended to cure. Legislation did not have to deal with the ordinary business of trade, but with those intangible elements--those uncertain quantities, the excited hopes, fears and panics of the masses; the avarice, speculations and gamblings of the desperate and the bad; no one knowing what a day might bring forth--the very fate of the nation hanging upon a battle unfought, depending upon a victory or defeat, and no human foresight able to determine which the next telegraph might announce, and thus all legislation was broken down and overwhelmed by an everchanging and imperious law which knew no master; the creature of all manner of sudden and uncertain influences, which no prophecy could fortell for an hour, no calculation could estimate, and no sagacity, prudence, wisdom or precaution provide for. Immediately upon and for some time after the war commenced, even among the most patriotic and hopeful, confidence in the ability of the Government to sustain itself was to some extent impaired. The entire South in arms, and many sympathizers in the North, was calculated to alarm the most faithful, and their very anxiety for the preservation of the Union exaggerated their apprehensions of its overthrow. So that, while the enemies of the Government were employing every desperate effort to overthrow it, the bare possibility that they might succeed gave greater apprehensions to its best friends than if they had been more indifferent and less patriotic, so that their very patriotic anxiety, in its effect, resulted as a loss of confidence. At times the situation looked gloomy, and the truest and best, even those who were periling all for its salvation were despondent, and so expressed themselves, and thus the Government had not at all times the confidence of its best friends in its final triumph, and thus the good and the bad, the traitor and patriot, all contributed to the creation of a feeling that the Government might fail--the one because he hoped it with a devilish hope, and the other because he feared it with a patriotic anxiety that rendered him liable to over estimate the real danger.
At one time in the dark hours of the Republic--July, 1864--gold was $2 85, its highest. It is now $1 35. The war has ended; the Government has demonstrated its ability for self preservation and confidence in the Government has been restored, and hence the original and chief cause has already been removed, and the effect has been to bring us half way back to specie payments, and that gold still remains at a premium is the result of incidental and secondary causes and influences which survive the original disturbing cause.
The chief cause, as we have seen, was one that could not be controlled by legislation, and the failure of efforts heretofore to so control it, might lead to the conclusion that nothing could in the future be accomplished; but since the restoration of peace and confidence, the remaining causes are in some measure artificial and much more, if not entirely, amenable to legislation.
The Government during a certain period, was compelled to resort to the issue of large amounts of paper currency, greatly depreciated by the double reasons that a want of confidence extended to the paper itself, and also because of the sudden expansion to a great amount, and thereby giving greatly increased nominal values or prices to all commodities.
Gold ceased to be a currency. It was not long found in the hands of the masses, but accumulated in bank vaults, and in the Government Treasury, and became an article of trade, and was bought and sold for prices varying as any other goods--indeed, more so; varying not only from day to day, but from hour to hour.
This issue of paper has ceased, confidence in the paper has been fully restored, and yet gold remains at a premium, is still an article of trade, and for this there must, of course, he causes: and the question is, what are they, and what the remedy, if any?
One of the causes of the premium on gold, as we have seen, was the great expansion of the paper currency, and by some it is maintained that the road, and only road to specie payments, is by a contraction of that currency, and that to this end the government should withdraw the legal tender paper.
Theoretically a specie basis means that there is as much gold as paper. It means that page: 248[View Page 248] every one who has a dollar in paper can present it to the party issuing it and demand and without delay receive for it a dollar in gold.
The Comptroller of the Treasury, in his annual report of November, 1867, estimates the amount of coin in the United States at three hundred million dollars, and the paper currency is six hundred and ninety million dollars. To return to specie payment through contraction, means to withdraw three hundred and ninety million of the paper currency.
If the country were free from debt to contract would do but little harm. The effect would be to reduce prices, but this would be self-adjusting and equalizing. If one-half of the currency were withdrawn, it would reduce prices one-half--wages, say from two dollars per day to one dollar--but as everything else would be reduced one-half, the one dollar would purchase as much as the two dollars formerly would have done.
But there is a giant in the way, a point of departure from which all financial calculations must be made; the mountain to which Mahomet must come--the public debt. In addition to the National debt there is a large amount of indebtedness by States, counties, cities and individuals, all contracted under an expanded currency, depreciated not only by its excessive volume, but also from a want of confidence, carrying its depreciation beyond the mere result of volume. To contract the currency one-half is, in effect, to double the burden of existing indebtedness of thousands of millions by decreasing by one-half the means with which to pay, while the amount to be paid remains the same.
Taxation is in no way a producer; it is exclusively a consumer, and must be paid from the surplus earnings of the people.
To illustrate the effect of contraction on existing indebtedness, let us suppose that a laboring man owed a note for $100 and was receiving $3 per day wages, and could support himself on $2, the surplus would pay his debt in 100 days. Contract the currency one-half and he would receive wages of one dollar and a half per day and can also live on one-half what it cost him before, as everything else has been affected the same as wages, and this would leave a surplus of fifty cents per day, requiring two hundred days work to pay his debt. His note promised one hundred dollars before contraction, and it only promises one hundred dollars after contraction, yet so far as the burden of payment is concerned, the effect has been to double his debt, for he must pay two hundred days labor for what was worth when he received it one hundred, and which he could have paid with one hundred, and labor is a proper and final standard of comparison, as from it all production is derived, and by labor all debts must at last be paid.
Contraction would depreciate the prices of commodities. There are thousands of dealers with stocks of merchanize for which they are indebted, and a rapid reduction of prices would render them unable to pay, and long credits would be required as a postponement of emergency, and many would lose largely and some utterly fail.
The estimate of coin in the country is 300,000,000 dollars. The National Bank currency amounts to about $300,000,000 and the United States notes and fractional currency to about $390,000,000, and hence to return to specie payments by reducing the currency to the amount of coin, would require the withdrawal of the entire amount of Government notes now in circulation, and this would either have to be done by paying the notes or funding them; and to pay them would require increased taxation, while the whole country is urging a reduction, and such taxation would be a double edged sword, for the tax is increased and the payment of it takes away the means with which to pay taxes at all, and the heavier the tax the more rapidly it extinguishes such means; for it is not thrown back into circulation, and hence the people would be slow to see the benefit of largely increasing an already heavy taxation, simply to deprive themselves of the best paper currency the nation ever had, producing distress and bankruptcy; and the wisdom of changing a non interest bearing debt, which supplies the country with a safe and favorite currency, by funding it into an interest-bearing debt, and gold interest at that, is not very apparent.
To contract by funding into bonds would be a self defeating measure, as the very process of funding is continually lessening the means with which to fund, and as money became scarce, it would create such necessities that it could be loaned at higher rates of interest than bonds would yield, for interest on money would go up as the premium on gold went down, and one of the inducements to invest in gold bearing bonds is to obtain the premium; but, as the funding progressed, if it had the effect desired, that is, to approach specie payment by bringing down the premium on gold, the effect of every dollar invested in a gold interest bond would be to decrease the inducement to invest further, and in addition, such funding is increasing the gold interest bearing debt; when, on the contrary, the great object is to lessen it, for it is the necessities growing out of that debt that creates the demand for gold, and causes the premium, and hence to increase that debt as a, policy looking to a return to specie payments, is anticipating a reverse effect from that which it would produce. It would be an attempt to cheapen an article, of which the supply is limited, by increasing the demand for it. Gold is now at a page: 249[View Page 249] premium because of the demand and necessity for its use and could we hope to bring down the premium by increasing that demand and necessity? Remove an evil by increasing the cause?
There are, however, contracting causes at work: the growth of the country, its increase of population and increasing commerce is working out the effect, of contraction by increasing daily the necessities for money while its volume remains stationery. There is an immense vacuum in the South, trade is prostrated, and a renewal of active commerce there, which must soon come, will gravitate to it a large amount of capital, which must of course, be withdrawn from that now in circulation in the North.
A return, then, to specie payments through a contraction, by the withdrawal of the United States notes, is not possible, and if it were, would in many respects be disastrous.
To repeal the Legal Tender act, with the United States notes in circulation, would be bad faith, leaving in circulation a large amount of paper which declared upon its face that it was a legal tender in payment of all debts, which it would not be, and leaving all debts payable in gold, if demanded, which would be impossible; and a return to specie payments means that all debts can be collected in gold if demanded.
If the Government were to commence with drawing United States notes, intending to withdraw them all, with a view to return to specie payments, that moment the National Banks would commence to withdraw their circulation, while they could obtain legal tenders with which to redeem it; for, if the legal tenders were withdrawn, the banks could not sustain a run on them for gold for a single day, and the demand for one hundred and eighty million dollars per year for customs would naturally direct the attention of importers to any bank on which they might happen to hold a note, in preference to buying it at a premium; and from that hour not a loan could be obtained or renewed, and the banks would mutually exchange their bills; and by the time the legal tenders were withdrawn, the National Banks notes would also be withdrawn; and the country left without any currency except its gold, resulting in panic and depreciation of prices so sudden as to bankrupt every person in debt and depending upon sales to meet it; annihilating incomes and other sources of taxation for years to come, and leaving the nation with an enormous debt, incurred under an exceedingly inflated and depreciated currency, to be paid in specie; and a debt too, not incurred as a source of profit, for which there was not only no financial equivalent in the shape of material wealth, but was actually incurred to take away the bone and muscle of the country from active industry and production, and affirmatively to employ it in waste and destuction as a measure of national self defense and preservation.
While, then, the nation has, no doubt or will realize benefits commensurate with the sacrifices it has made (for it cannot be that one drop of patriot blood has been shed in vain,) yet, financially speaking, at least for the present, the country is as much poorer than it would have been if the war had not occurred, as the debt it owes--added to the losses by actual destruction--and also of what failed to be produced.
The premium on gold is in great measure occasioned by a necessity for its daily and continually recurring use, in large quantities, for custom duties, and to the fact that one-third of the entire coin of the country has been for years locked up in the United States Treasury.
If, then, some plan can be devised to obviate for a time this necessity for its use, and for all time its hoarding in the public Treasury, it would effect much toward a return to specie payments.
We have seen that there were four causes for gold premium:
- --A want of confidence in the Government.
- --The expansion of the paper currency.
- --The demand for gold for export.
- --To pay duties on imports.
The first cause has been removed, confidence has been restored, and gold premium has been reduced one-half.
The second cause--the expansion of the currency, has ceased, and some degree of contraction effected. On the first day of December, 1866, the paper circulation of the country amounted to nine hundred million six hundred and forty-four thousand and fifty-one dollars and on the first day of December, 1868, to six hundred and eighty-four million three hundred and fifty-seven thousand nine hundred and seventy-nine dollars and fifty cents, or a contraction of two hundred and sixteen million two hundred and eighty-six thousand, seventy-two dollars and fifty cents, being a fraction over twenty-four per cent., so that this cause has not only ceased, but has in a good measure been corrected.
As for the third cause, the export of gold, we are a gold producing country, producing from seventy million to one hundred million dollars per annum, having inexhaustible mines and can produce gold cheaper and in greater quantities than the rest of the world, and can, therefore, afford to export it precisely as we could iron or any other metal.
Our exports of gold are large, but the report of the Comptroller of the Treasury, of November 4, 1867, after deducting forty-three million dollars for possible errors, shows that there page: 250[View Page 250] has been an actual gain in the last six years of twenty-five million dollars of coin in the country, so that our product is greater than our export, and as the drain is less than the supply, our exports should not be, standing alone, a sufficient cause to continue gold at a premium; and our cotton export will, in a few years, no doubt, turn the balance of trade in our favor, and then our gold product will be retained at home.
The fourth cause, however, yet remains: Our imports are large, and the duties must all be paid in gold, this being necessary to procure the means with which to pay the interest on the public debt. Nearly the whole of this debt is represented by bonds with interest coupons payable semi-annually in gold. The Treasury collects and for six months hoards gold to pay these coupons, and when payments are made for interest, the necessity for gold to pay duties on imports enables the payee to sell his gold at a premium, and just here we seem to have traced to its source the present remaining cause of the difference between gold and paper, viz: One-third of the gold of the country locked up in the Treasury, and nearly all of the other two-thirds running through it every year; and this it is that keeps gold at a premium and always will, for it is regulated by the laws of demand and supply, just as any other commodity; and as the supply is limited and the demand great, it commands a high price, and will continue to do so so long as this condition exists; so long as gold is a commodity and not a medium of exchange; and the question is, is there a remedy?
If means to pay the interest on the bonds could be found without requiring gold, we could then dispense with the collection of import duties in gold, and thus at once strike down the great and leading demand. The average customs realized during the last 3 years was one hundred and seventy three million, three hundred and ten thousand, twenty dollars and sixty-five cents and the entire debt except about eighty million dollars has been funded, and will require about $130,000,000 coin per year to pay the interest; and if the past can be assumed as a basis for calculating the future, the customs could be relied upon for a surplus over all necessities for interest to the amount of forty three million dollars per annum.
If the Government would permit the import duties to be paid directly in coupons due, or receive them one year or eighteen months in advance of becoming due, it would throw into the market from one hundred million to one hundred and fifty million of what would be equivalent to gold.
The advantage of receiving the coupons in advance of being due are obvious. At present the holder can not realize the gold until due; but make receivable to-day coupons that are not due for a year or a year and a half, and holders will sell for less than the present price of gold, for they can have for a year or more the use of the money, and one hundred and fifty million dollars of coupons become a competition with gold, and they commenced bidding each other down and the coupons are an inexhaustible supply, or, at least, an ample and continual supply until their final exhaustion; and such final exhaustion is the final and absolute relief sought; that, in fact, being the great end to be accomplished, everything else being means to such end.
The customs receipts will amonnt to more per annum than the coupons becoming annually due. When all due in one year or a year and a half are taken up, extend the same rule to two or three years, and keep the time so extended as to continually keep a large amount of competing coupons on the market, for just in proportion to the length of time they can be used in advance of due, just in that proportion is the inducement to holders to place them on the market; and as there is now eighty-eight million dollars in gold in the Treasury, and as the customs in any one year will absorb all the coupons payable in fifteen months, the time can be continually extended; and when the coupons have all been paid a year or two in advance, the Government can then gradually disburse the gold in the Treasury for the necessity of retaining it will have ceased. The Government obligations will all have been paid in advance and as no demand can be made on it for gold, it need not and would not retain it in its vaults. If coupons were made receivable two or three years before due, they would, no doubt sell at a discount, as also the bonds divested of them; and if the Government had funds to spare, it could, no doubt, purchase them to a great advantage, or permit duties to be paid with the bonds themselves.
Gold no longer being required in excess of supply, would cease to command a premium; and there being no speculative, gambling or forced demand, holders would not long permit it to remain idle, and it would come again in to general circulation; and as it does so, the Government can then gradually withdraw its own notes to an equal amount, or else withdraw the National Bank currency, which the gold, according to the best estimates, would exactly supply or replace. This would leave ninety million dollars more paper in circulalation than coin, but confidence being fully restored the nation could easily carry this excess.
Instead, then, of collecting and hoarding gold to pay the coupons,receive the coupon themselves for duties and dispense with the necessity for the gold; or, perhaps, a simpler plan would be to issue notes in exchange for coupons, and make such notes receivable for duties.
page: 251[View Page 251]The Secretary of the Treasury is now authorized to receive deposits of gold; and issue therefor what are known as gold certificates, and which are receivable in payment of import duties, and the object might be gained by the Secretary receiving coupons as deposits of gold, which they represent, and are to him vouchers for the disbursement of gold, and upon such deposits issue gold certificates not payable at the Treasury, but receivable for duties.
One of the effects of a return to specie payments would be a great advance in the price of our bonds held abroad. These bonds pay six per cent. interest in gold, while in London the usual rate of bank interest is two per cent; in Paris two and one half; in Hamburgh one and a half, and in all these places, in open market, one half per cent less, and in but few countries of Europe is the rate of interest more than three or four per cent.
English consols only pay three per cent., and until quite recently have sold at about ninety-four, realizing about three and one-fifth per cent interest.
Until quite recently United States sixes sold in London for about seventy-one, thus realizing interest at the rate of eight and one-half per cent in a city where money is loaned freely at two per cent. According to an article recently published in the newspapers. Russian five per cents sell in London at eighty-six, or twenty-one per cent higher than our sixes, and so of Egypt and Peru. Peruvian five per cents, were stated to be about the same price as United States sixes, and their sixes are twenty per cent higher, and that bonds of the Cape of Good Hope sold in London at one hundred and seven; of the island of Ceylon at one hundred and twelve, and of New Zealand at ninety-five, and all of these counties greatly in debt and badly governed. Bonds of the State of Massachusetts (six per cents) sell in London at a premium--those of the United States at seventy-one. Within a short time United States sixes have advanced to seventy-five, while consols have fallen to ninety-two, being in sympathy with the fall of gold in this country; but at these prices consols only pay three and one-fourth per cent, interest, while United States sixes pay eight per cent--nearly two and one half times as much as consols.
It cannot be that in the opinion of the monied men of Europe, United States bonds are a more hazardous investment than those of Egypt, Peru, the Cape of Good Hope or New Zealand; and yet they are sold for less, and the reason is because they can be bought from us here at home for such lower price.
A Londoner buying bonds pays for them in gold; the gold or its equivalent is sent to New York. English gold is at a premium over American of nine and thirty-six hundreths per cent. on account of the difference in the standard of purity between the coin of the two countries. If, then, we add nine and thirty-six hundreths per cent, premium to American gold, and go into the market of New York to buy bonds, it will be found that the price paid is about the same as the London quotations. The premium on sterling exchange, of course, is not always the precise difference in the purity of the coin, but is sometimes greater and sometimes less, and hence the premium should be added, whatever it may happen to be.
If we were to return to specie payments tomorrow, United States bonds would in a few days be par in the city of London, and in a very short time command a premium; for, at one hundred and eighty-four they would be as good an investment as British consols at 94, and at one hundred and eleven would pay as well as New Zealand bonds, and at one hundred and seven as well as the bonds of the Cape of Good Hope, and at 300 would pay as well as open market loans in London or Hamburg; and if we had returned to specie payments I have no doubt that our bonds bearing four per cent, interest could be sold in Europe at par, and if so, such new bonds should be issued and sold, and with the proceeds redeem all the six per cents on which the Government option has matured.
It is important, then, if we sell any more bonds abroad, that we should return to specie payments, for we are losing, and have lost thirty per cent, and over, on all bonds sold to Europe, and we had better export gold than sell bonds, as for gold we receive full value, while for the bonds only about two-thirds.
While the effect of a return to specie payments would advance the price of bonds abroad, it would, in one respect, have a tendency to reduce the price here, for one of the profits of an investment in bonds here is the fact that the interest is payable in gold, and gold commands a premium; but a return to specie payments takes off the premium, and hence the bond becomes a less profitable investment, yet if the bonds had advanced largely in Europe, the effect would probably be to sustain prices here.
There are some interests that would be opposed to a return to specie payments, as, for instance, the holders of bonds, and also manufacturers of goods that come in competition with foreign merchandize, the duty on which must be paid in gold, and the preminm operates as a tariff; and also the holders of large stocks of imported goods, on which the duty has already been paid, as such goods, immediately upon a return to specie payments, would fall an amount equal to the previous gold premium.
There are also some interests that would be aided by a return to specie payments through contraction, as, for instance, ship building and page: 252[View Page 252] cotton growing. During the war a stimulous was given to cotton growing in Egypt and other countries until they can now, in a good measure, supply foreign markets at prices as low as we can, and this country could more certainly compete with others in cotton raising by a reduction in the price of labor, which reduction would be effected by a contraction of the currency.
Ship building has almost been annihilated because of cheaper labor elsewhere. A citizen of the United States can buy gold at say one hundred and thirty-four take it to Canada and have a ship built, paying eighty-seven cents per day for labor, equal to one dollar sixteen cents in currency, while in the United States the wages demanded and heretofore paid were 4 dollars per day, or three and one-half times as much as in Canada, and a return to specie payments without contraction would more thoroughly destroy this interest, because it cheapens gold without cheapening labor, and gold could be bought cheaper to take to Canada, while wages in the United States would remain the same. Labor in Canada in ship building costs about eighty-seven cents in gold per day, and the gold here costs one dollar and sixteen to one dollar and twenty cents; but if gold were par, the gold which would pay for a day's wages in Canada would cost but eighty-seven cents, while here the same day's labor would cost four dollars; and in England ships can be built cheaper even than in Canada. There was a meeting near London in December, 1867, of seven thousand ship-wrights out of employment, seeking charity, who declared themselves willing to work for one shilling per day--equal to twenty-three cents of our money.
A contraction of the currency, which as a necessary consequence would have the effect to lower laborers' wages, would benefit ship building and cotton growing. We can not protect cotton growing nor our ship building against foreign competition as we can other manufactures and productions by a tariff for ships built abroad and cotton raised abroad, for foreign markets do not have to pass our custom houses, and the prostration of the ship building interest illustrates what would become of other manufactures had we no tariff to protect our laborers against the low priced labor of Europe--labor being always at least two hundred per cent. higher in this country than in Europe, and our ship builders recieve 17 times as much as the ship builders assembled near London one year ago were willing to accept.
As exported cotton is paid for in gold the grower receives the benefit of the premium, and the gold dollar is worth more to him than the paper dollar, and a return to specie payments without contraction would deprive him of that advantage, for then the gold dollar received from England would be worth no more to him than one of our own paper dollars.
These two interests are, then, in a measure lost to the country, as they can only be fully fostered by contraction but contraction does not reduce the fixed indebtedness of the country and especially the public debt, the great center and dictator of the financial system, and about which everything else must revolve, while contraction does increase the burden of the payment of such debts, and hence contraction is not likely to be resorted to for the benefit of one or two interests at the expense of all others.
The means to pay this debt must be collected by the tax on incomes, sales, &c., all of which would be reduced by contraction. The surplus is less, and though under a general contraction it might be just as valuable for every other purpose, yet it would not go so far in the payment of the fixed debt, for that is so mary dollars, and if every dollar in circulation were doubled in purchasing value, yet it would only pay one dollar of existing debt.--Contraction, then, reduces the surplus of individual profits, and this debt must be paid out of the surplus of individual wealth.
If it were decreed that the volume of currency should remain the same as at present, and yet that every debtor should pay his creditor two dollars for each one he now owed him, the proposition that the debt had been doubled would be very simple and self-evident; and also if it were decreed that the present indebtedness should remain fixed and should be paid with a currency reduced one-half, that the effect would be to double the burden of the debt is as simple a proposition as the first.
In the one instance the currency remains fixed and the debt is doubled, and in the other the debt remains fixed and the currency is made scarcer by one-half; but in both cast the relation of debt to the volume of currency has been changed alike; that is, the debt increased as two to one, or the currency decreased as one-half to one.
If an income this year under the present volume of currency were two thousand dollars, it would pay fifty dollars income tax; but contract the currency one-half and that income under the same conditions would be only one thousand dollars, on which nothing would be paid. One hundred dollars will pay as much of the existing debt with the present volume of currency as it would were it contracted one-half; but after the contraction fifty dollars would be worth as much in current business, and would be as hard to procure as one hundred dollars was previously, while it would only pay one-half as much old debt; and as contraction would inevitably make times hard and distress debtors, whenever it commenced to pinch, there would be a strong popular opposition to it, to which legislators would ne- page: 253[View Page 253] cessarily yield, and hence anti-contraction becomes the despot of the situation.
As, however, there are great benefits to be derived from a return to specie payments, especially, as it affects our foreign trade, yet to do so through contraction is not only undesirable, but impossible. Some other means should be adopted, if any there be, and it would seem that the adoption of a system which dispensed with an arbitrary demand and necessity for gold, that puts an end to gold gambling, would do much to effect this result, as no one would buy gold and pay a premium for it when there was no profitable use could be made of it; and ceasing to be an article of trade, it would soon come into circulation, and in a year or two the Legal Tender act might be repealed, and yet the people would use greenbacks or National Bank notes as freely and with greater confidence than formerly bank paper, and gold would not be demanded, for the greater convenience of paper than metal will insure its use in preference, when the people have confidence in it, and this they do and would have for Government paper to a greater extent than heretofore in any other.
We have now three hundred million dollars in gold idle, except for duties, and six hundred and eighty-four million dollars of depreciated paper in circulation, while the silver of the country is all idle. If the gold were ushered into circulation, and three hundred million dollars of paper withdrawn, the volume of currency would be the same as at present; there would be neither contraction or expansion; prices and values undisturbed, and the relations of debtor and creditor unchanged; and yet the remaining paper would be brought to par, and the point to be gained is this substitution of the gold for paper by a transition so gradual as to avoid financial perturbation.
It might be however, that to make one hundred million to one hundred and fifty million dollars of coupons at once receivable for duties, and dispensing with gold entirely and bringing it to par might operate as a shock to some of the business interests of the country, and hence it might be more cautious to authorize the Secretary to issue bills in the similitude of Government notes, and of all denominations and make them exchangeable for coupons and receivable for duties, and authorize him to commence, and in the first month issue and exchange one million of such notes, and increasing one million each month, and at the end of about fifteen months this issue would pay the whole duties, and then we would have arrived at a specie basis so gradually and quietly as to have avoided all financial shocks and disturbances.
Various plans have been suggested, but in many respects impracticable, and the question is one of magnitude and difficulty, and the best plan will no doubt have its difficulties; but it is clear that one grand essential feature of any plan of resumption must be that the Government first places itself in such a condition as to be sale from a run on the Treasuary for gold which it cannot supply. If the Government, with seventy million dollars in gold in the Treasury, were to proclaim that gold would be paid for all claims presented, it is to be feared that the gold speculators would, in a few days, present United States notes enough to withdraw every dollar of gold in the Treasury and then the Government would be at their mercy, for gold must be had to pay the coupons, and the speculators having all the gold under their control, the Government would be compelled to buy and pay them their own price; and the Government would be kept continually redeeming its paper with gold, dollar for dollar, and buying back the same gold ut a high premium, simply to be again instantly demanded in exchange at par for the very paper with which it had just been bought at a high premium.
Neither can gold be hoarded until sufficient has accumulated to place the Government beyond this contingency. With the amount now in the Treasury it would require three years at least to run up the accumulation to two hundred million dollars, and the continual withdrawal from circulation of gold during this period would have the effect to increase the premium; for the gold, although becoming continually scarcer and scarcer must yet be had to pay duties, and the effect would be for three years' to be going farther and farther from specie payments to make preparations for an instantaneous return to it.
Let us keep in view the point to be gained, and that is, to bring down the premium on gold without inflation or contraction, and without financial disturbance, to withdraw the paper and substitute the gold. This can not be done by depreciating the gold, but by appreciating the paper; and this can not be done so long as the Government itself, by law, creates an arbitrary and artificial discrimination against the paper. And neither will contraction bring us to specie payments, for the cause of the premium is the demand for gold to pay duties; but if one-half of the paper currency were withdrawn, yet not one dollar of the balance could be used for the payment of duties. The demand for gold for that purpose would be as great and imperative as before.
The joint resolution proposes a plan which at once takes away this demand. It makes the importer independent of the gold market, for he can pay duties with coupons, of which the market will be full, and it also makes the Government independent of the gold market, for the surrender of the coupons for duties extinguishes the claim against it for gold, and a redemption of all its gold coupons a year or more in advance enables the Government to page: 254[View Page 254] disburse the gold now in the Treasury, and also enables it to withdraw the United States notes. To release the immense sum of gold in the Treasury and send it into circulation is a more direct road to specie payments than to systematically gather into the Treasury to remain idle for years almost all the gold in the nation.
Suppose from this day the demand for gold for custom duties should cease, and in addition the Government should commence to withdraw its notes, at the same time sending seventy million dollars of long-hoarded gold into circulation how long could gold be sold at a premium? There would be no buyers.
Not to return to a specie basis, is to continue a financial condition without foundation--the football of party politics, and disastrously affecting our foreign trade; and yet to return through contraction is ruin, bankruptcy and possibly repudiation.
The plan suggested in the joint resolution seems to meet the necessary conditions to secure the good and avoid the evil.
Mr. FISHER spoke against the resolution, claiming that gold is principally demanded now for two purposes only--to pay duties on imports, and buy foreign goods. For the latter purpose gold alone can be used. He could see nothing in the resolution beyond a proposition to pay interest before it is due, while he could not see that it would relieve the country. He was of opinion that but a small portion of the Senator's argument was applicable to the resolutions under consideration, which, if carried out, would have the effect to hoard gold in the Treasury of the United States, without interest. He could see no approximation in the Senator's plan to the resumption of specie payment. And, if the plan were adopted, it is a matter of mere speculation how much the price of gold would be effected by it. We never can return to specie payment until we have the specie 10 redeem our currency with, and how this is to be brought about is in the future. He could see nothing in the plan proposed that would help the country financially, in the least degree. He could see no good to grow out o the measure, and hence should oppose the resolution.
Mr. WOLCOTT reminded the Senate that the committee to which this resolution was referred reported on it unanimously, and in favor of its lying on the table. He insisted that the statement made by the Senator from Marion [Mr. Caven] concerning the amount of gold in the country, [three hundred million dollars,] was a wild statement, and stated that in the hands of the national banks there was now but twelve million dollars, and in th hands of the Government about seventy million or eighty million dollars. If gold was released, it would go abroad. The only thing that keeps it here is the necessity for paying import duties with it. The depreciation of our currency was produced by the four causes named by the Senator, and others; for instance the great magnitude of the public debt, and the political and moral causes with which we are surrounded; and they are all still existing--they have not been reduced to a single one. There is no remedy by the legislation the gentleman proposes.
The report of the committee was concurred in, and so the resolutions lay on the table.
STATE RIGHTS.
Mr. SHERROD moved to take up his concurrent resolutions, [see page 222 and 223] pending at the adjournment on Monday last--reading from the rules of the Senate to show that the consideration of his resolutions was the first thing in order upon the meeting of the Senate. The Republicans have a majority on this floor--these resolutions embody principles of the greatest importance, and he simply wished to know if the opposition are prepared to meet this question fairly and squarely. If his object was to make political capital he would desire, above all things, that the resolutions be voted down, for it is well known that thirty thousand voters in Indiana are not represented on this floor.
The LIEUTENANT GOVERNOR said that he presumed the resolution was before the Senate without the necessity of a motion.
Mr. FISHER. My recollection is that there was a motion made to lay that resolution on the table, upon which the yeas and nays were being called, and the Senate adjourned without a quorum.
The LIEUTENANT GOVERNOR. The question is upon the pending motion to lay the resolution on the table.
The motion to lay the resolution on the table was agreed to by yeas 19, nays 17--as follows:
YEAS--Messrs. Beardsley, Caven, Church, Cravens, Elliott, Fisher, Gray, Hadley, Hamilton, Hess, Hooper, Jaquess, Reynolds, Robinson, of Madison, Robinson of Decatur, Scott, Stein, Wolcott and Wood--19.
NAYS--Messrs. Bird, Bradley, Carson, Denbo, Hanna, Henderson, Huey, Huffman, Hughes, Humphreys, Johnson of Montgomery, Kinley, Lasselle, Lee, Morgan, Sherrod and Turner--17.
Pending the roll call
Mr. GRAY said: As that is the condition of the resolution and this is my motion, I shall have to vote "aye."
Mr. KINLEY, when his name was called, said it is very well known that I am opposed to the spirit of these resolutions, but as I am willing Senators shall have a chance to make a record, I am not afraid to vote "no," in order to give them the opportunity.
Mr. STEIN, when his name was called, page: 255[View Page 255] said I understand the object of this resolution is to strike at the suffrage amendment. My only objection to the proposed suffrage amendment is that it is not half broad enough. I am in favor of universal suffrage, limited only by sex or crime.
So the resolution was laid on the table.
THE DECLARATION OF INDEPENDENCE OF 1776, AND WOMAN'S BIGHTS.
Mr. KINLEY offered the following resolution:
RESOLVED, By the Senate of the State of Indiana, that we hold these truths to be self evident, that all men are created equal; that they are endowed by their creator with certain unalienable rights, that among these are life, liberty, and the pursuit of happiness; that to secure these rights Governments are instituted among men, deriving their just powers from the consent of the governed.
Mr. CARSON moved to amend by inserting after the word "men," the words "without distinction of race or color."
Mr. HUGHES moved to amend the amendment by adding after the word "men" the words "and women."
Mr. KINLEY thought that is the intent and meaning of the declaration--that the word men was used in its generic sense, and that the amendment was unnecessary.
Mr. CARSON accepted the amendment to the amendment proposed by Mr. Hughes.
Mr. CRAVENS had a great respect for the Declaration of Independence, and rather than see the work of the Fathers of our revolution interpolated, he would accept of the interpretation of the Senator from Wayne, (Mr. Kinley) that the word "men" here is used in its generic sense, and includes both men and women. He therefore moved to lay the amendment on the table.
The motion to lay the amendment on the table was agreed to by yeas 24; nays 12.
Mr. JOHNSON, of Montgomery, moved ineffectually to lay the whole proposition on the table--yeas 17; nays 19.
Mr. BRADLEY thought the resolution could be improved by striking out the word "unalienable," before the word "rights," and inserting in lieu the word "inalienable."
The motion was rejected.
Mr. HUGHES moved, in all seriousness, to insert the words "and women" before the "men," not that he expected to improve upon the Declaration of Indpendence, as it was at that time, and for the purposes then made, but we are trying to make a declaration of what we think is right now, and his object in offering his amendment, was to bring distinctly before the Senate the question of the rights of the female portion of the community. Women had but very little part in free governments then; but we have progressed on that subject. The word "men" was not intended to include women in the administration of Government. His object was to put that question before the Senate in a definite shape. He could not say that he was in favor of female suffrage because he was in favor of restricted suffrage, even among males; but he was in favor of females voting over a great many men. The time had come, and this question is to be pressed upon us. If the Declaration of Independence were to be made today by the American people, women would be recognized as having all the rights that negroes have, and a great many think negroes are included in the words of the Declaration. That is a disputed point in politics, although literally they are included.
Mr. KINLEY, if it was a question of the rights of women simply, would go as far as any other Senator in favor of the proposition. He believed the word "men" includes the human race; but not to consume more time on the subject he demanded the previous question. The demand for the previous question was seconded by the Senate.
The amendment was agreed to by yeas 29; nays 7--as follows.
YEAS.--Messrs. Beardsley, Bird, Carson, Caven, Church, Cravens, Denbo, Elliott, Fisher, Gray, Green, Hadley, Hamilton, Henderson, Hooper, Huey, Huffman, Hughes, Humphreys, Johnson of Montgomery, Lasselle, Lee, Morgan, Reynolds, Robinson of Madison, Robinson of Decatur, Scott, Turner and Wood--29.
NAYS.--Messrs. Bradley, Hess, Jaquess, Kinley, Sherrod, Stein and Wolcott--7.
The resolution as amended was then adopted by yeas 24, nays 11.
RAILROAD CONSOLIDATIONS.
The PRESIDENT pro tem. (Mr. Robinson, of Madison,) announced the special order, being the consideration of Mr. Cravens' bill [S. 97] touching the consolidation of railroads.
Mr. CRAVENS presented this bill in answer to what he regards as the demands of the people; for it is getting to be a question whether the State belongs to the railroads or the railroads to the State. He hoped Senators would give this subject a thoughtful and careful consideration. He disclaimed any unfriendliness to railroads or any other corporations; for it would be supreme folly to strike at the power for usefulness of these corporations. He made a lengthy argument in support of the provisions of his bill.
Mr. SCOTT moved to amend the first section, by providing that railroads that have consolidated, shall have six months to resume and organize under their special charters, etc.
Mr. CRAVENS hoped the amendment would not pass. He desired to have all railroad companies brought under the operation of one law--general and uniform in its character.
Mr. SCOTT could see that one purpose of page: 256[View Page 256] the bill was to take away some existing rights and privileges held by the roads in this State. Privileges solemnly and fairly granted by the State, should not now be ruthlessly taken away--the railroads ought to have some time in which they could resume those rights. He saw no special reason for taking away these rights or privileges, and would not vote for it without good cause.
Mr. WOLCOTTT was inclined to favor the amendment, for reasons which he gave.
Mr. CRAVENS insisted that the main object of his bill was to bring all the railroads in the State under the fostering care of the State and the provisions of one general law. Most all of them now are operating under special charters, hardly any two of them alike. In the great struggle for through business the rates are brought so low by competition that they tax the local business to make up for their losses on through freight, and our citizens become the victims of this competition. This evil, growing day by day, promises to be a serious evil, controlled and imposed upon our citizens by directors living for the most part in the great metropolis of the nation--New York city.
The amendment was rejected.
Mr. ROBINSON of Decatur, moved to print two hundred copies of this bill and make it the special order for Tuesday next at ten o'clock.
The motion was agreed to.
POSTAGE STAMPS.
Mr. BIRD offered a resolution, that the State Librarian furnish members and officers with seven dollars worth of postage stamps. addition to the previous orders for static and stamps, or stationery in lieu thereof.
Mr. GRAY made an ineffectual motion to lay the resolution on the table.
Mr. CARSON said the House had voted themselves ten dollars worth of stamps, and this was to keep pace with that body--the Senate having heretofore voted three dollars worth.
Mr. FISHER moved to strike out the seven dollars.
Mr. CHURCH insisted that Senators should have an equal amount of stamps with members in the other end of the Capitol, and favored the passage of the resolution.
On motion by Mr. CARSON, the amendment was laid on the table.
The resolution was adopted by yeas 18, nays 16.
And then--
The Senate adjourned till ten o'clock to-morrow morning.
