Recollections of Forty Years in the House, Senate and Cabinet Part 93

bond, but against the compulsory provision that no other than three per cent. bonds should be deposited in the treasury as security for the circulating notes of, and deposits with, national banks; that President Hayes, in fact, approved of the three per cent. bond.

I made a speech in support of this measure on the 26th of January, reviewing our financial condition, with many details in respect to our different loans, and closed as follows:

"I say now, as I said at the commencement, that the pa.s.sage of this bill seems to me a matter of public duty. I care nothing for it personally. I have been taunted with my inconsistency. I feel like the Senator from Kentucky about an argument of that kind. If I did not sometimes change my mind I should consider myself a blockhead or a fool. But in this matter, fortunately, I have not changed my mind. In 1866 I antic.i.p.ated the time when we could sell three per cent. bonds and said that was a part of the funding scheme, and so continued, year in and year out, as I could show Senators, that that was the _ultima thule_, the highest point of credit to which I looked in these refunding operations. I believed last year it could not be done, because I did not believe the state of the money market would justify the attempt, and, besides that, the great ma.s.s of the indebtedness was so large that it might prevent the sale of three per cent. bonds at par. Therefore, I wanted a three and a half per cent. bill then. But then we secured the three and a half in spite of Congress, by the operations of the treasury department and the consent of the bondholders, now we ought to do a little better.

"Let Congress do now what it proposed to do last year, offer to the people a three per cent. bond. If they do not take it no harm is done, no expense is incurred, no commissions are paid, no advantage is taken. If they do take it, they enable you to pay off more rapidly still your three and a half per cent. bonds.

There was no express and no implied obligation made by the Senator from Minnesota, as he will himself say, that the people of the United States have the right to pay every dollar of these three and a half per cent. bonds. He had no power to make such an intimation even, nor has he made it, as he states himself. We are not restrained by any sense of duty, we have the right to take advantage of our improved credit, of our advanced credit, and make the best bargain we can for the people of the United States, and the doctrine is not 'let well enough alone,' but always to advance.

"We are advancing in credit, in population, in strength, in power, in reason. The work of to-day is not the work of to-morrow; it is but the preparation for the future. And, sir, if I had my way in regard to these matters I certainly would repeal taxes; I would fortify ourselves in Congress by reducing this large surplus revenue; I would regulate, by wise and separate laws, fully and fairly considered, all the subjects embraced in these amendments as separate and distinct measures, pa.s.s this bill which, to the extent it goes and to the extent it is successful, will be beneficial to the people."

The debate upon the bill and upon amendments to it continued until the 3rd of February, when it pa.s.sed the Senate by the decided vote of 38 yeas, 18 nays.

The bill was referred to the committee of ways and means, but the House, instead of pa.s.sing a separate bill, accomplished the same object by section 11 of the national bank act of July 12, 1882, by which the Secretary of the Treasury was authorized to receive at the treasury any bonds of the United States bearing three and a half per cent. interest, and to issue in exchange therefor an equal amount of registered bonds of the United States bearing interest at the rate of three per cent. per annum.

Mr. Folger, Secretary of the Treasury, in his annual report of December 4, 1882, stated that on July 1, 1882, the amount of three and a half per cent. bonds outstanding was $449,324,000, and that under the section referred to he had exchanged to the date of his report $280,394,750 of three per cent. bonds for a like amount of three and a half per cent. bonds, thus reducing the annual interest charge by reason of these exchanges $1,401,973.75.

By his report of 1883, it was shown that the total amount of such exchanges was $305,581,250, making an annual saving of interest, effected by these exchanges, of $1,527,906.25. These bonds were subsequently paid from time to time by surplus revenue.

The whole process of refunding was perhaps as favorable a financial transaction as has ever been executed in any country in the world.

A revision of the tariff was greatly needed, but the only measure adopted at that session was an act to provide for the appointment of a commission to investigate the question of the tariff. I made a speech on this bill in which I advocated the appointment of a commission. I said:

"Mr. president, I have called attention to these defects in the present tariff, nearly all of which have grown out of amendments that have been ingrafted on the Morrill tariff, by the confusion caused by the difference between _ad valorem_ and specific duties, by the great fall in prices, by important changes in the mode of manufacturing, by, you may say, the revolution in trade and prices that has occurred in the last twenty years, during which these laws have existed. Therefore, coming back to the first question stated by me, how best to get at a revision of the tariff, I say the quickest way is the best way.

"Now, it does seem to me, with due deference to the opinion of the Senator from Kentucky, that the quickest mode of revision is by a commission. At the beginning of this session I believed it was better to do it through the committees of the two Houses; but the committee on ways and means of the House of Representatives alone has the power to report a bill, and until then we in the Senate are as helpless as children in this matter. The committee on ways and means have declared in favor of a commission, and have reported a bill to that effect; and they are the only power in this government that can report a tariff bill under the rules of the House. The House is the only body that can originate it under the const.i.tution.

As they have decided in favor of a commission, why should we insist upon it that they shall do the work themselves?

"Besides, half the session has pa.s.sed away, and the committee on ways and means is burdened with other duties. We know that as the session approaches an end, they probably cannot devote time to the general tariff question.

"If they will give us a bill about sugar and these other items, it is all we can reasonably ask them to do. When Congress adjourns, you cannot expect the committee on ways and means, or any other committee of Congress, to devote all their recess to public business.

Elections are coming off for Members of Congress, and they will look after the elections. They must have a little rest. Therefore, the idea of waiting for the committees of Congress to act, is preposterous in my judgment. It is too late. If the committee had commenced on the first Monday of December, they might by this time probably had prepared a bill. They have made no such preparation, and, therefore, it is utterly idle to wait.

"I think, then, and I submit it to the good, cool sense and judgment of my friend from Kentucky, that the better way is as early as possible to organize a commission; let it be const.i.tuted, as I have no doubt the President will take care to const.i.tute it, of fair and impartial men. They will be fresh at least. Let them frame a bill with the aid of officers of the treasury department, so that by the next session we may have a general revision of the tariff.

"Upon the main question there appears to be no substantial difference of opinion. We agree that the tariff should be revised and the taxes be reduced. The only pertinent question involved in this bill is whether it is best to organize a commission of experts, not Members of Congress, to examine the whole subject and to report such facts and information to Congress as the commission can gather, or whether the proposed revision should be made directly, without the delay of a commission, by the aid of committees of Congress and the officers of the government familiar with the workings of the customs laws. It does seem to me that to decide this question we need no long arguments about protection or free trade, watchwords of opposing schools of political economy, nor does it seem to me that the political bearings of the tariff question are involved when we all agree that the tariff ought to be revised, and are now only finding out the best way to get at it.

"Whenever a tariff bill is reported to us we will have full time to discuss the theoretical and political aspects of the subject, and no doubt the arguments already made will be repeated and amplified. I prophesy that then we will have a strange mingling of political elements, and a striking evidence of the changes of interest and principle on this subject in different parts of the country, caused by the revolution of the industry of our people by the abolition of slavery during the Civil War. The only mitigation of my desire for a prompt revision of the tariff is the confidence I have that delay and discussion will make the sectional revolution more thorough and universal, and leave the tariff question a purely business and not a political or sectional issue."

The nine commissioners appointed by President Arthur were well selected, and they were, under the law, required to report on that subject to the following session of Congress.

It became necessary at this session to extend the corporate existence of national banks. By the terms of the original national banking act, banks organized under it continued for but twenty years, which would expire within two years. A bill for the extension of the time was introduced and a long discussion followed about silver, certificates of deposit, clearing house certificates and other financial matters. There was but little if any opposition to the extension of national banks and the bill pa.s.sed. It was approved July 12, 1882.

The most important financial measure pa.s.sed by this Congress was the bill to reduce internal revenue taxes, reported March 29, 1882, by William D. Kelley, of Pennsylvania, from the committee of ways and means. After a debate extending to June 27, a motion to recommit was rejected and the bill pa.s.sed the House. It was sent to the Senate and reported with amendments by Mr. Morrill, from the committee on finance, July 6. On July 11 it was recommitted to the committee on finance and immediately reported back with amendments, which consisted of a change in the tariff duties on sugar and an increase of the duties on cotton, ties and a few other things. It was not a general revision of the tariff. Mr. Beck antagonized the amendments proposed by the committee and sought to delay the pa.s.sage of the bill. I replied to him as follows:

"If this Congress shall adjourn, whether the weather be hot or cold, without a reduction of the taxes now imposed upon the people, it will have been derelict in its highest duty. There is no sentiment in this country stronger now than that Congress has neglected its duty thus far in not repealing taxes that are obnoxious to the people and unnecessary for the public uses; and if we should still neglect that duty we should be properly held responsible by our const.i.tuents."

In the course of the long debate Mr. Vance, of North Carolina, who was the acknowledged wit of the Senate, moved to except playing cards from the general repeal of stamp taxes. I objected to keeping up the system of stamp taxes and said:

"If Senators want to insist on a piece of what I call demagogism, by keeping a small stamp tax on playing cards, I am perfectly willing that they should do so. If it is desired now to show our virtuous indignation against card-playing, to single out this tax, which probably yields but three or four thousand dollars a year-- to show our virtuous indignation against people who play cards and against card-playing, let it be done in the name of Heaven. Let us keep this as a monument of our virtue and intelligence and the horror of the Senate of the United States against playing whist and euchre. I hope that no such vote will be given."

Mr. Vance replied in his peculiarly humorous way, and concluded by saying: "I have no doubt that not a men in the United States, but who, when he 'stands pat' with three jacks, or draws to two aces, will glorify the name of the Senator from Ohio; and if there is grat.i.tude in human nature, I expect the see the next edition of playing cards bearing a fullsized portrait of the Senator from Ohio as the distinguishing mark of the 'yerker.'"

The Senate was equally divided on this question of retaining the tax on playing cards, the vote being 28 for and 28 against. As there was not a majority in favor of the amendment of Mr. Vance it was rejected and the tax was repealed.

Mr. Beck undertook to amend the bill by a general revision and reduction of the tariff duties in long schedules introduced by him.

I took an active part in the discussion of this bill in the hope that by it we might secure a logical and desirable revenue law.

No final action was taken on it before the adjournment of Congress on the 8th of August, after an eight months' session, and it went over to the next session.

After the long and wearisome session I returned to Mansfield. The congressional canva.s.s in Ohio was then in full operation. The failure of Congress to pa.s.s the bill relieving the people from the burden of internal taxes no longer required, the shadow of the murder of Garfield, the dislike and prejudice against Arthur's administration, the temporary stringency in money matters, the liquor or license question, the Sunday observance, and the discontent of German Republicans, greatly weakened the Republican party in the state and foreboded defeat. R. A. Horr was the Republican candidate for Congress in the district in which I reside, and on the 17th of August he spoke at Mansfield. I also made a brief speech covering the chief subjects under discussion. I explained the causes of the failure to pa.s.s the revenue reduction bill, blaming it, as a matter of course, on the Democratic party, but a.s.sured my hearers that it would pa.s.s at the next session, and that the surplus revenue would not be wasted, but would be applied to the reduction of the public debt, and to increase pensions to Union soldiers, their widows and orphans. The opposition to the immigration of Chinese into this country was then strong. I could only promise that Congress would do all it could to exclude them consistently with treaty stipulations. I favored the proper observance of the Sabbath day, claiming that it was a day of rest and should not be desecrated, but each congregation and each citizen should be at liberty to observe it in any way, consistent with good order and noninterference with others. Touching on the liquor question, I said that many of our young men were brought to disgrace and crime by indulgence in intoxicating liquors, and I therefore believed in regulating the evil. Why should all other business be suspended, and saloons only be open? I was in favor of a law imposing a large tax on all dealers in liquor, which would tend to prevent its use. I believed in a policy that would protect our own laborers from undue compet.i.tion with foreign labor, and would increase and develop our home industries. This position was chiefly a defensive one, and experience has proven that it is not a safe one. The Republican party is stronger when it is aggressive.

On the 31st of August I attended the state fair as usual, and on the morning of that day made a full and formal political address covering both state and national interests. I quote a few pa.s.sages on the liquor question, then the leading subject of state policy.

I said:

"All laws are a restraint upon liberty. We surrender some of our natural rights for the security of the rest. The only question is, where is the boundary between rights reserved and those given up? And the only answer is, wherever the general good will be promoted by the surrender. In a republic the personal liberty of the citizen to do what he wishes should not be restricted, except when it is clear that it is for the interest of the public at large.

There are three forms of legislative restriction: Prohibition, regulation and taxation, of which taxation is the mildest. We prohibit crime, we regulate and restrain houses of bad fame. We tax whisky and beer. I see no hardship in such restraints upon liberty. They are all not only for the public good, but for the good of those affected. If certain social enjoyments are prolific of vice and crime they must give way, or submit to restraints or taxation.

"I know it is extremely difficult to define the line between social habits and enjoyments perfectly innocent and proper and those that are injurious to all concerned. It is in this that the danger lies, for the law ought never to interfere with social happiness and innocent enjoyments. The fault of Americans is that they are not social enough. I have seen on the banks of the Rhine, and in Berlin, old and young men, women, children of all conditions of social life, listening to music, playing their games and drinking their beer, doing no wrong and meaning none. I have seen in the villages of France the young people dancing gayly, with all the animation of youth and innocence, while the old people, looking on, were chatting and joking and drinking their native wines, and I could see no wrong in all this.

"But there were other scenes in these and other countries: Ginshops and haunts of vice where the hand of authority was seen and felt.

What I contend for is that the lawmaking power shall be authorized to make the distinction between innocent and harmful amus.e.m.e.nts and the places and habits of life which eventually lead to intemperance, vice and crime. Surely we can leave to our general a.s.sembly, chosen by the people and constantly responsible to them, the framing of such wise regulations, distinction and taxes as will discriminate between enjoyment and vicious places of resort.

"It is a reproach to our legislative capacity to allow free whisky to be sold, untaxed and without regulation, at tens of thousands of groggeries and saloons, lest some law should be pa.s.sed to restrain the liberty of the citizen. What we want is a wise, discriminating tax law on the traffic in intoxicating liquors, and judicious legislation to restrain, as far as practicable, the acknowledged evils that flow from this unlimited traffic."

This speech expressed my convictions in respect to temperance, and how far this and kindred subjects should be regulated by legislative authority. This was a delicate subject, but I believe the opinions expressed by me were generally entertained by the people of Ohio and would have been fully acted upon by the legislature but for revenue restrictions in the const.i.tution of Ohio.

After I closed Governor Foster and Speaker Keifer spoke briefly.

The general canva.s.s then continued over the state until the election.

As the only state officers to be elected were the secretary of state, a supreme judge and a member of the board of public works, the chief interest centered in the liquor question and in the election of Members of Congress in doubtful districts. I spoke in several districts, especially in Elyria, Warren, Wauseon, Tiffin and Zanesville. I spent several days in Cincinnati, socially, and in speaking in different parts of the city. The result of the election was that James W. Newman, the Democratic candidate for secretary of state, received a majority of 19,000 over Charles Townsend, the Republican candidate. This was heralded as a Democratic victory. In one sense this was true, but it was properly attributed by the Republicans to the opposition to prohibition. It grew out of the demand of a portion of our people for free whisky and no Sunday. THey were opposed to the liquor law, and believed it went too far, and voted the Democratic ticket.

A few days after the election I went with two friends to Lawrence, Kansas, arriving about the 15th of October. I have always retained a kindly feeling for the people of that state since I shared in the events of its early history. With each visit I have marked the rapid growth of the state and the intense politics that divided its people into several parties. This was the natural outgrowth of conditions and events before the Civil War. As usual I was called upon to make a speech in Lawrence, which, in view of our recent defeat in Ohio, was not a pleasant task. However, I accepted, and spoke at the opera house, chiefly on the early history of Kansas and the struggle in that territory and state, which resulted in transforming the United States from a confederacy of hostile states into a powerful republic founded upon the principles of universal liberty and perpetual union.

From Lawrence we went into Texas, and for the first time traversed that magnificent state, going from Denison to Laredo on the Rio Grande, stopping on the way at Austin and San Antonio. On the route I met Senator Richard c.o.ke and his former colleague, Samuel B. Maxey. I have studied the history of Texas and its vast undeveloped resources, and antic.i.p.ated its growth in wealth and population. It is destined to be, if not the first, among the first, of the great states of the Union. We returned via Texarkana to St. Louis and thence home.

CHAPTER XLV.

STEPS TOWARDS MUCH NEEDED TARIFF LEGISLATION.

Necessity of Relief from Unnecessary Taxation--Views of the President as Presented to Congress in December, 1882--Views of the Tariff Commission Appointed by the President--Great Changes Made by the Senate--Regret That I Did Not Defeat the Bill--Wherein Many Sections Were Defective or Unjust--Bill to Regulate and Improve the Civil Service--A Mandatory Provision That Should be Added to the Existing Law--Further Talk of Nominating Me for Governor of Ohio--Reasons Why I Could Not Accept--Selected as Chairman of the State Convention --Refusal to Be Nominated--J. B. Foraker Nominated by Acclamation --His Career--Issues of the Campaign--My Trip to Montana--Resuming the Canva.s.s--Hoadley Elected Governor--Retirement of Gen. Sherman.

The President was able to present, in his annual message to Congress on the 4th of December, 1882, a very favorable statement of the condition of the United States during the preceding year. He recalled the attention of Congress to the recommendation in his previous message on the importance of relieving the industry and enterprise of the country from the pressure of unnecessary taxation, and to the fact that the public revenues had far exceeded the expenditures, and, unless checked by appropriate legislation, such excess would continue to increase from year to year. The surplus revenue for the fiscal year ending June 30, 1881, amounted to $100,000,000, and for the fiscal year ending June 30, 1882, it amounted to more than $145,000,000. This was applied to the payment of the public debt. He renewed the expression of his conviction that such rapid extinguishment of the national indebtedness as was taking place was by no means a cause for congratulation, but rather for serious apprehension. He therefore urged upon Congress the policy of diminishing the revenue by reducing taxation. He then stated at length his opinion of the reductions that ought to be made. He felt justified in recommending the abolition of all internal taxes except those upon tobacco in its various forms, and upon distilled spirits and fermented liquors. The message was a clear and comprehensive statement of the existing tariff system, and the unequal distribution of both its burdens and its benefits.

He called attention to the creation of the tariff commission, and to the report of that commission as to the condition and prospects of the various commercial, manufacturing, agricultural, mining and other interests of the country, and recommended an enlargement of the free list, so as to include within it numerous articles which yielded inconsiderable revenue, a simplification of the complex and inconsistent schedule of duties upon certain manufactures, particularly those of cotton, iron and steel, and a substantial reduction of the duties upon those and various other articles.

The subsequent action of Congress did not, in my opinion, conform to this, in some respects, wise recommendation of the President.

In his closing paragraph he stated:

"The closing year has been replete with blessings for which we owe to the Giver of all good our reverent acknowledgment. For the uninterrupted harmony of our foreign relations, for the decay of sectional animosities, for the exuberance of our harvests and the triumphs of our mining and manufacturing industries, for the prevalence of health, the spread of intelligence and the conservation of the public credit, for the growth of the country in all the elements of national greatness--for these and countless other blessings--we should rejoice and be glad. I trust that under the inspiration of this great prosperity our counsels may be harmonious, and that the dictates of prudence, patriotism, justice and economy may lead to the adoption of measures in which the Congress and the Executive may heartily unite."