CHAPTER LVII. HISTORY OF THE "SHERMAN SILVER LAW." President Harrison's First Annual Message-His Recommendations Regarding the Coinage of Silver and Tariff Revisions- Bill Authorizing the Purchase of $4,500000 Worth of Silver Bullion Each Month - Senator Plumb's "Free Silver" Amendment to the House Bill - Substitute Finally Agreed Upon in Conference-Since Known as the "Sherman Silver Law"-How It Came to Be So Called-Chief Merit of the Law-Steady Decline of Silver After the Passage of the Act - Bill Against Trusts and Combinations-Amendments in Committee - The Bill as Passed - Evils of Unlawful Combinations - Death of Representative Wm. D. Kelley and Ex-Member S. S. Cox-Sketch of the Latter My Views Regarding Immigration and Alien Contract Labor-MeKinley Tariff Law-What a Tariff Is-Death of George H. Pendleton - Republican Success in Ohio - Second Session of the 51st Congress - Failure of Senator Stewart's "Free Coinage Bill.” T - HE first session of the 51st Congress convened on the 2nd of December, 1889, both branches being Republican. President Harrison, in his message, reported a very favorable condition of the national finances. The aggregate receipts from all sources, for the fiscal year ending June 30, 1889, were $387,050,058. The total expenditures, including the sinking fund for that year, were $329,579,929. The excess of receipts over expenditures was $57,470,129. The estimated surplus for the current year was $43,678,883. This would justify, and the President recommended, a reduction of taxation to that amount. He called attention to the reduction of the circulation of national banks amounting to $114,109,729, and to the large increase of gold and silver coin in circulation and of the issues of gold and silver certificates. The law then in force required the purchase of two million dollars worth of silver bullion each month, to be coined into silver dollars of S.-73 (1061) 412 grains of standard silver nine-tenths fine. When this law was enacted, on the 28th of February, 1878, the price of silver in the market was $1.20 per ounce. Since that time to the date of his message the price had fallen to 70.6 cents an ounce. He expressed a fear of a further reduction of the value of silver, and that it would cause a difference in the value of the gold and silver dollars in commercial transactions. He called the attention of Congress to these three subjects of national importance the reduction of taxation, the circulation of national banks, and the further issue of silver coin and silver certificates, and invoked for them the considerate action of Congress. He recommended a revision of the tariff law in such a way as not to impair the just and reasonable protection of our home industries, the free list to be extended to such domestic productions as our home industries did not supply. He referred approvingly to a plan for the increased use of silver, which would be presented by Secretary Windom. The plan, submitted by Secretary Windom in his report, for increasing the use of silver in the circulation, provided that the treasury department should purchase silver bullion every month to a limited extent, paying therefor treasury notes receivable for government dues and payable on demand in gold, or in silver bullion at the current market rate at the time of payment, and that the purchase of silver bullion and the compulsory coinage of silver dollars under the act of 1878 should cease. On the 28th of January, 1890, Senator Morrill introduced, by request, a bill which had been prepared by, and embodied the views of the Secretary of the Treasury. This bill was referred to the committee on finance, and was reported back by Senator Jones, of Nevada, February 25, with amendments. The first section of the amended bill authorized the Secretary of the Treasury to purchase $4,500,000 worth of silver bullion each month, and to issue in payment therefor treasury notes receivable for customs and all public dues, and when so received they might be reissued. They were also redeemable on demand in lawful money of the United States, and when so redeemed should be canceled. Such portion of the silver was to be coined as might be necessary to meet the redemptions authorized. Other sections provided for details by which the plan was to be effected. To this bill I proposed an additional section authorizing the deposits of legal tender notes by national banks with the United States treasurer; to meet the redemption of the notes of such banks which had failed, gone into liquidation, or were reducing their circulation, to be covered into the treasury to the credit of an appropriation from which the money could be withdrawn as necessary to meet the payments of the notes for which the deposits had been made. The deposits of this character often exceeded $50,000,000, but under the plan proposed the money became immediately available in current disbursements, thus avoiding a hoarding of the notes in the treasury or the creating of a stringency in the circulation, and, at the same time, giving the government the use of the deposits until needed, by which the issue of bonds to a considerable extent would be avoided. This arrangement was accepted and eventually became section 6 of the law which is now in satisfactory operation. In the progress of the debate on this bill every question connected with the financial operations of the government for twenty years was introduced and made the subject of debate, and especially the coinage act of 1873, and the dropping of the old silver dollar from coinage. Although this coin had been restored by the act of 1878, and hundreds of millions of such dollars had been coined, yet the Senators from the silver producing states, and especially Stewart, were continually harping on "the crime of 1873," as they called the coinage act of that year, a careful statement of which has already been made in these volumes. The only new allegation made was that the amendment recommended by the Senate committee on finance, to strike out the frané dollar of 384 grains, provided for in the bill as it came, from the House, and insert the trade dollar, was not agreed to in the Senate, but that the change was made in committee of conference, and passed without the knowledge of the Senate. A conclusive answer was made to this statement by the production, from the files of the secretary's office, of the original bill as it stood after its passage in the Senate and before it was sent to conference. As similar statements have been frequently made, I reproduce the portion of this original bill showing the section in question, with the printer's note accompanying the bill explaining the different type used in printing it. The word "AGREED" on the bill is in the handwriting of the journal clerk of the Senate, Mr. McDonald, who held that position many years until his death. It shows that the Senate adopted the recommendation of the committee on finance before the bill was sent to conference. This amendment was agreed to by the House conferees. [Note in explanation of the bill (H. R. 2934).] 1. The body of the bill, printed in brevier, is as it came from the House. 2. Amendments to insert, reported by Committee on Finance, are in italics. 3. Amendments to strike out, reported by Committee on Finance, are in [brackets]. 4. Amendments made by the Senate striking out words are in brevier, with brackets, and the words inserted in lieu thereof in the handwriting of the Clerk, are in SMALL CAPS. IN THE SENATE OF THE UNITED STATES. MAY 29, 1872. Read twice and referred to the Committee on Finance. Reported by Mr. SHERMAN with amendments, viz: Strike out the Mr. SHERMAN, from the Committee on Finance, reported additional 1 2 1 2 AN ACT Revising and amending the laws relative to the mints, assay- Be it enacted by the Senate and House of Representatives of the SEC. [16] 15. [That the silver coins of the United States shall be a dollar, a half-dollar or fifty-cent piece, a quarter-dollar or twenty3 five-cent piece, and a dime or ten-cent piece; and the weight of the 4 dollar shall be three hundred and eighty-four grains; the half-dol5 lar, quarter-dollar, and the dime shall be, respectively, one-half, 6 one-quarter, and one-tenth of the weight of said dollar; which coins 7 shall be a legal tender, at their nominal value, for any amount not 8 exceeding five dollars in any one payment.] That the silver coins 9 of the United States shall be a trade-dollar, a half-dollar or fifty AGREED A DIME OR TEN-CENT PIECE 10 cent piece, a quarter-dollar or twenty-five-cent piece^; and the 11 weight of the trade-dollar shall be four hundred and twenty grains 12 troy; the weight of the half-dollar shall be twelve grams and one13 half of a gram; the quarter-dollar and the dime shall be, respec14 tively, one-half and one-fifth of the weight of said half-dollar; 15 and said coins shall be a legal tender at their nominal value for 16 any amount not exceeding five dollars in any one payment. AGREED On the 5th of June I made a speech covering not only the pending bill, and the cognate questions involved, but all the irrelative topics introduced by other Senators. I said: "I approach the discussion of this bill, and the kindred bills and amendments pending in the two Houses, with unaffected diffidence. No problem is submitted to us of equal importance and difficulty. Our action will affect the value of all property of the people of the United States, and the wages of labor of every kind, and our trade and commerce with all the world. In the consideration of such a question we should not be controlled by previous opinions or bound by local interests, but, with the lights of experience and full knowledge of all the complicated facts involved, we should give to the subject the best judgment which imperfect human nature allows. With the wide diversity of opinion that prevails, each of us must make concessions in order to secure such a measure as will accomplish the objects sought for without impairing the public credit or the general interests of our people. This is no time for visionary theories of political economy. We must deal with facts as we find them and not as we wish them. We must aim at results based upon practical experience, for what has been probably will be. The best prophet of the future is the past. "To know what measures ought to be adopted we should have a clear conception of what we wish to accomplish. I believe a majority of the Senate desire, first, to provide an increase of money to meet the increasing wants of our rapidly growing country and population, and to supply the reduction in our circulation caused by the retiring of national bank notes; second, to increase the market value of silver, not only in the United States, but in the world, in the belief that this is essential to the success of any measure proposed, and in the hope that our efforts will advance silver to its |