"I have before me the record of the proceedings of this House on the passage of that measure, a record which no man can read without being convinced that the measure and the method of its passage through this House was a `colossal swindle.' I assert that the measure never had the sanction of this House, and it does not possess the moral force of law." - William S. Holman.
Prior to the demonetization of silver in the United States, England and Portugal were the only nations whose standard of monetary value was based on gold.
After the great Napoleonic wars which convulsed Europe for so many year's, finally ending in the overthrow of the military power of France at Waterloo in 1815, the national debt of England reached a colossal figure, exceeding four billions of dollars.
This vast debt was created by the efforts of Great Britain in her struggle to crush Napoleon.
The greater portion of this immense burden on the industries of the people of that country was purchased at a very heavy discount by the bond holders.
At this time England was the great naval power of the world, and her merchant vessels entered the ports of every civilized and semi-civilized nation; and she made good her boast that she was "Mistress of the Seas."
In 1816, England adopted a single gold standard as the basis of her financial system. Silver was made a
legal tender to an amount not exceeding forty shillings for any one payment.
This act of parliament was procured through the influence of the immensely wealthy bankers and fund holders, with the sole aim of enhancing the value of the vast debt held by them, and with the avowed purpose of perpetuating its existence.
Sir Moreton Frewen, an eminent writer and financier of London, charges that this measure was instigated by the capitalists of England, and that it was class legislation of the worst type.
The financial system thus adopted by parliament during the ministry of Lord Liverpool consisted of gold as the standard of value, silver as subsidiary coin used in the small transactions of business, and notes issued by the Bank of England, the latter being a credit currency redeemable in gold by the bank.
In 1844, the charter of the Bank of England was amended by act of parliament, by which that corporation must pay for all gold bullion or mutilated coins offered at its counter, the sum of three pounds, seventeen shillings, and nine pence for each ounce of gold tendered to it. This price was equivalent to eighteen dollars and ninety-two cents in money of the United States.
This act of parliament was the matured result of the policy of Sir Robert Peel, at that time the Prime Minister of England, and it fixed the price of gold throughout the British empire in every part of the world, and it gave notice to the owners of gold bullion everywhere, that this great bank stood ready, at all times, to pay the price fixed by the law of its creation. Gold would never go below that price, although there was no
limitation in the law by which the bank was forbidden to pay more for that precious metal.
The evident purpose of that policy fixing the minimum value of gold was the prohibition of speculation in it by bullion brokers. Another important object of the passage of this law was to make London the money market of the world, and therefore the center of exchange.
Moreover, at the time of the parliamentary act of 1844, the colossal debt of England was payable in gold, and the fund-holding class of Great Britain was instrumental in procuring the passage of this act, fixing the minimum price of gold by law with the avowed intention of enhancing its purchasing power over all other forms of property.
The policy embodied in the Peel Act is the basis of the financial system of England.
After the close of the civil war in America, Great Britain had become a large holder of United States bonds, railway stocks, and securities, and other obligations of this country, to the amount of many hundreds of millions of dollars, the great majority of which were purchased for a pittance.
The great banking houses of Net York City and Boston are the agents of the money lending classes of Great Britain, and are the mere echoes of Lombard street, London.
Since the discovery of the enormously rich gold mines of Australia, which rivaled those of California, she ranks as one of the leading producers of gold, while the mines of the latter are giving indications of exhaustion.
The production of silver in the British empire was
comparatively small, while that of the United States was rapidly increasing in value.
The amount of English capital invested in the national banking system is unknown, but is undoubtedly very large, and it was the bankers of London who suggested the scheme of the present national banking law, as shown by the circular issued by James hazard, of which mention was made in the second chapter of this work.
It must be borne in mind that, from 1862 to 1873, United States Senator John Sherman was the Chairman of the Finance Committee of the national Senate, to which was referred, and which framed and moulded the various financial measures placed upon the statute books of the nation. He was the great predominating power in the financial legislation of Congress.
In 1867, the great International Exposition at Paris was held, to which the nations of the world were invited by the Emperor of Prance.
Secretary of State Seward, on behalf of the United States, appointed Samuel B. Ruggles as the commissioner to represent this country at that magnificent undertaking.
Napoleon III, the Emperor of France, on the 4th of January, 1867, extended an invitation to all the powers, including the United States, to hold a conference in Paris, for the purpose of extending the principles of the Latin Union throughout the commercial world. This Union was originally formed December 23, 1865 by and between France, Italy, Greece, Belgium, and Switzerland, whereby these five nations agreed to establish for themselves jointly a system of common coinage, weights, and measures, as a means for the promotion of commerce.
The monetary system adopted by the Latin Union provided for the free coinage of both gold and silver at a ratio of fifteen and one-half to one.
It also made provision in its articles by which any other nation could become a member of the convention.
Article 12 of the union was as follows; viz.,-
"Any other nation can join the present convention by accepting its obligations and adopting the monetary system of the union in regard to gold and silver coins."
The invitation of the French Emperor was accepted by the commercial nations of Europe and America, and Mr. Ruggles was appointed as the representative of the United States.
Senator Sherman, who was the Chairman of the Committee on Finance of the Senate, on information of the receipt of the invitation of the Emperor, visited London in the spring of 1867, prior to the convening of this monetary conference. After consulting with the London bankers and capitalists, he hastened to Paris where the conference was to convene in the near future, and in reply to a note of Ruggles, sent a communication to that gentleman in which he advocated the adoption of a single gold standard.
The material part of this remarkable letter to Mr. Ruggles is as follows: -
"Hotel Jardin des Tuileries, May 18, 1867.
"My Dear Sir: Your note of yesterday, inquiring whether Congress would probably, in future coinage, make our gold dollar conform in value to the gold 5-franc piece, has been received.
"There has been so little discussion in Congress upon the subject that I cannot base my opinion upon anything said or done there.
"The subject has, however, excited the attention of several important commercial bodies in the United States, and the time is now so favorable that I feel quite sure that Congress will adopt any practical measure that will secure to the commercial world a uniform standard of value and exchange.
"The only question will be how this can be accomplished.
"The treaty of December 23, 1865, between France, Italy, Belgium, and Switzerland, and the probable acquiescence in that treaty by Prussia, has laid the foundation for such a standard.
"If Great Britain will replace the value of her sovereign 2 pence, and the United States will reduce the value of her dollar something over 3 cents, we then have a coinage in the franc, dollar, and sovereign easily computed, and which will readily pass in all countries; the dollar as 5 francs, and the sovereign as 25 francs.
"This will put an end to the loss and intricacies of exchange and discount.
"Our gold dollar is certainly as good a unit of value as the franc, and so the English think of their pound sterling. These coins are now exchangeable only at a considerable loss, and this exchange is a profit only to brokers and bankers. Surely each commercial nation should be willing to yield a little to secure a gold coin of equal value, weight, and diameter, from whatever mint it may have been issued.
"As the gold 5-franc piece is now in use by over 60,000,000 of people of several different nationalities, and is of convenient form and size, it may well be adopted by other nations as the common standard of value; leaving to each nation to regulate the divisions of this unit in silver coins or tokens.
"If this is done France will surely abandon the impossible effort of making two standards of value. Gold coins will answer all the purposes of European commerce. A common gold standard will regulate
silver coinage, of which the United States will furnish the greater part, especially for the Chinese trade."
It will be seen from the statements volunteered by Mr. Sherman in his letter to Mr. Rugglcs, that he was endeavoring to leave the impression upon this conference, that the United States was in favor of a single standard of gold; and that the effort of Prance in making two standards of value was impossible; and that a common gold standard would regulate silver coinage.
The position assumed by Senator Sherman had immense influence, for at that time he held the most important position on the leading committee of the United State Senate.
He spoke as one having authority, and gave his moral influence to that financial policy which has finally destroyed one-half of the money metals of the world.
While in England Mr. Sherman was evidently ascertaining the views of influential persons and bodies upon this proposed change of the coinage laws. We quote further from his letter to Mr. Ruggles in which he says:
"In England many persons of influence and different chambers are earnestly in favor of the proposed change in the coinage. The change is so slight with them that an enlightened self-interest will soon induce them to make it, especially if we make the greater change in our coinage."
This letter is an important link in the chain of evidence that tends to prove a concerted plan on the part of British and American financiers to effect a momentous change in the coinage laws of the United States, a change that resulted in the demonetization of silver.
Senator Sherman furnished the best of evidence, that, "Many persons of influence and different chambers" of a foreign country mere taking deep interest in the coinage laws of a nation to which they owed no allegiance.
Mr. Sherman was a leading member of the United States Senate, and it is deducible from his writings that, after ascertaining the views of these "influential persons and chambers" as to what system of coinage would be satisfactory to them, he immediately proceeded to carry them into effect by introducing a bill to that end.
The phrase, "Many persons of influence and different chambers," undoubtedly signifies the bankers and other fund holding classes of Great Britain, who mere interested in securing legislation that would enhance the value of stocks and bonds.
This letter of the Senator to Commissioner Ruggles is a voluntary confession from Mr. Sherman, that he was in London in conference with influential interests which were earnestly in favor of the proposed change in the standard of money.
On the 30th of May, 1867, Mr. Ruggles transmitted a communication to Secretary of State Seward, in which he states that the letter of Senator Sherman urging the adoption of a single standard of gold was laid before the International Committee having the question of uniform rain under special examination.
In this communication, Mr. Ruggles informs the Secretary of State of an interview held with Napoleon, with reference to the coinage of gold and silver, in the course of which the French emperor propounded the following significant question: "Can France do anything more in aid of the ivory?"
We here quote the reply of Mr. Ruggles to the question of the
emperor in his own language; viz.,-
"To which it was replied, France can coin a piece of gold of twenty-five francs, to circulate side by side on terms of absolute equality with the half eagle of the United States and the sovereign, or pound sterling, of Great Britain, when reduced, as they readily might be, precisely to the value of twenty-five francs. The emperor then asked, `Will not a French coin of twenty-five francs impair the symmetry of the French decimal system?' To which it was answered, `No more than it is affected, if at all, by the existing gold coin of five francs," that it was only the silver coins of Franco which were of even metric weight, while every one of its gold coins, without exception, represented unequal fractions of the meter.
"It was then stated to the Emperor that an eminent American statesman, Mr. Sherman, Senator from Ohio, Chairman of the Finance Committee of the Senate of the United States, and recently in Paris, had written an important and interesting letter, expressing his opinion that the gold dollar of the United States ought to be and readily might be reduced by Congress, in weight and value, to correspond with the gold 5-franc piece of France; that the letter was now before the International Committee having the question of uniform coin under special examination, to which letter, as being one of the best interpretations of the views of the American people, the attention of the public authorities of France was respectfully invited. The emporer then closed the audience by repeating the assurances of his gratification that the important international measure in question was likely to receive active support from the United States.
"The letter of Mr. Sherman, above referred to, dated the 18th of May, 1867, originally written in English, was presented in a French translation a few days afterward to the International Committee in full session, where it was received with unusual interest and
ordered by the committee to be printed in both languages. A copy is herewith transmitted for the information of the Department of State."
Upon a fina1 vote in the conference, the influence of England and John Sherman succeeded in defeating the adoption of a bi-metallic standard, and a single standard of gold was agreed upon by the conference with but a single dissenting vote. Hence, it will be seen that John Sherman and Samuel B. Ruggles were the two eminent persons whose influence was exerted against the adoption of the sagacious policy of the Emperor of France, which had for its object an international standard of both gold and silver at a ratio of fifteen and one-half to one.
It is evident that Senator Sherman exerted his great influence in defeating international bi-metallism, the adoption of which would have resulted in untold benefits, not only to the United States, but to the world at large.
As the first step for carrying into execution the scheme outlined in his Paris letter, Senator Sherman, during the second session of the Fortieth Congress, introduced Senate bill 217, entitled, "A bill in relation to coinage of gold and silver."
The material parts of this proposed measure are contained in sections one, two, and three, which are as follows: -
"Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That, with a view to promote a uniform currency among the nations, the weight of the gold coin of five dollars shall be 124 8/20 troy grains, so that it shall agree with a French coin of twenty-five francs, and with the rate of thirty-one hundred francs to the kilogram;
and the other sizes or denominations shall be in due proportion of weight, and the fineness shall bc nine-tenths or 9oo parts fine in 1,ooo.
"Section 2. And be it further enacted, That, in order to conform the silver coinage to this rate and to the French valuation, the weight of the half dollar shall be 179 grains, equivalent to ll6 decigrams; and the lesser coins be in due proportion, and the fineness shall be nine-tenths. But the coinage of silver pieces of one dollar, five cents, and three cents shall be discontinued.
"Section 3. And be it further enacted, That the gold coins to be issued under this act shall be a legal tender in all payments to any amount; and the silver coins shall be a legal tender to an amount not exceeding ten dollars in any one payment."
The language of these sections expressly demonetizes the standard silver dollar of 412 1/2grains as the unit of account by omitting to provide for its coinage.
The only silver coins that could be issued from the mints of the United States, should this bill become a 1aw, would be the half dollar, the quarter dollar, and tan cent piece, which would be legal tender for the payment of debts to any amount not exceeding ten dollars in any one payment; while gold coin would be unlimited legal tender to any amount.
The bill was referred to the Finance Committee, of which Mr. Sherman was Chairman, and on the 9th of June, 1868, he reported it back favorably, and he advocated its passage in an elaborately written argument.
He thus spoke of the system of coinage which the bill proposed to establish as follows: -
"The second inquiry of your committee was whether the plan proposed by the Paris conference was the best mode to accomplish the end desired.
It proposes: -
1. A single standard exclusively of gold.
2. Coins of equal weight and diameter.
3.Of equal quality of fineness - nine-tenths fine.
4. The weight of the present s-franc gold piece to be the unit.
5. The coins of each nation to bear the names and emblems prepared by each, but to be legal tenders public and private in all.
"The single standard of gold1 is an American idea, yielded reluctantly by France and other countries, where silver is the chief standard of value. The impossible attempt to maintain two standards of value has given rise to nearly all the debasement of coinage of the last two centuries. The relative market value of silver and gold varied like other commodities, and this led first to the demonetization of the more valuable metal, and second to the debasement or diminution of the
quantity of that metal in a given coin."
This was the first effort ever attempted to fasten a single gold standard upon the American people, and the declaration of Senator Sherman that, "The single standard of gold is an American idea," was misleading, as he well knew at the time when he use a this language in the report quoted.
The sing1e gold standard is of British origin, as the parliamentary acts of 1816 and 1844 conclusively prove beyond any doubt whatever.
Mr. Sherman also used the following language in that rcport: -
"France, whose standard is adopted, makes a new coin similar to our half eagle. She yields to our demand for the sole standard of gold, and during the whole conference evinced the most earnest wish to secure the co-operation of the United States in the great object of unification of coinage."
The rcport above quoted is proof positive, that Senator Sherman and Mr. Ruggles had placed the United States in a false light before the Paris conference.
The distinguished Senator avers that France yielded to "Our demand for the sole standard of gold" - an astonishing piece of intelligence to his colleagues.
For, be it remembered, Mr. Ruggles was a mere appointee of the President, and Congress had not, either by bill or resolution, authorized Mr. Ruggles to represent the United States at any monetary conference whatever.
The attitude of Mr. Ruggles on the proposed change of the coinage laws of the United States was purely voluntary, and, in fact, the views of this gentleman and Senator Sherman were distinctly repudiated by Congress at its earliest opportunity.
The same committee, by Senator Morgan, of New York, submitted a minority report against the passage of the bill. Wc quote at length from this powerful document: -
"In June last, while the Universal Exposition was in progress, an international monetary conference washeld in Paris under the presidency of the French minister of foreign affairs.
"Delegates from the several European nations were present.
"Mr. Samuel B. Rugglcs represented the United States, and his report on the subject has been communicated to Congress through the Department of State. From this it appears that a plan of monetary unification was there agreed upon, the general features of which are:
"1. A single standard, exclusively of gold.
"2. Coins of equal weight and diameter.
"3. Of equal quality, nine-tenths fine.
"4. The weight of the present 5-franc gold piece to the unit, with its multiples. The issue by France of a new coin of value and weight of 25 francs was recommended.
"5. The coins of each nation to continue to bear the names and emblems preferred by each, but to be legal tenders, public and private, in all.
"Senate bill 217 is designed to carry into effect this plan. Its passage would reduce the weight of our gold coin of $5, so as to agree with a French coin of 25 francs.
"It determines that other sizes and denominations shall be in clue proportion of weight and fineness, and that foreign gold coin, conformed to this basis, shall be a legal tender so long as the standard of weight and fineness are maintained. It requires that the value of gold coin shall be stated both in dollars and francs, and also in British terms, whenever Great Britain shall conform the pound sterling to the piece of $5.
"It conforms our silver coinage to the French valuation, and discontinues the silver pieces of $1,5, and 3 cents, and limits silver as a legal tender to payments of $10. The 1st of January, 1869, is fixed as the period for the act to take effect.
"The reduction which this measure would effect in the present legal standard value of the gold coin of the United States would be at the rate of three and a half dollars to the hundred, and the reduction in the legal value of our silver coinage would be still more considerable.
"A change in our national coinage so grave as that proposed by the bill should be made only after the most mature deliberation. The circulating medium is a matter that directly concerns the affairs of everyday life, affecting not only the varied, intricate and multiform interests of the people at home, to the minutest detail, but the relations of the nation with all other countries as well. The United States has a peculiar interest in such a. question. It is a principal producer of the precious metals, and its geographical position, most favorable in view of impending commercial changes, renders it wise that we should be in no haste to fetter ourselves by any new international
regulation based on an order of things belonging essentially to the past."
Further on in his report, the distinguished Senator, with rare power of fact and argument, exposes this new scheme of finance proposed to be fastened upon the American people by the bill introduce by Sherman.
He shows that the American continent produced four-fifths of the silver of commerce; that the mines of Nevada have taken high rank; and that Mexico alone supplied more than half of the world's grand total.
He points out that silver money is the key to the commerce of the western hemisphere, and of the trade of Chins, Japan, India, and other Oriental countries.
The Senator says: -
"The American continent, too, produces four-fifths of the silver of commerce. The mines of Nevada have already taken high rank, and Mexico alone supplies more than half the world's grand total. Our relations with the silver-producing people, geographically most favorable, are otherwise intimate.
"Manifestly our business intercourse with them can be largely increased, a fact especially true of Mexico, which, for well-known political reasons seeks the friendliest understanding. This must not bc overlooked.
"These two streams of the precious metals, poured into the current of commerce in full volume, will produce perturbations marked and important. Other countries will be affected, but the United States will feel the effect first and more directly than any other.
"The Pacific railway will open to us the trade of China, Japan, India, and other Oriental countries, of whose prepossessions wc must not lose sight. For years silver, for reasons not fully understood, has been the object of unusual demand among these Asiatic nations, and now forms the almost universal medium
of circulation, absorbing rapidly the silver of coinage. The erroneous proportion fixed between silver and gold by Prance, and which we are asked to copy, is denuding that country of the former metal. Our own monetary system, though less faulty, is not suitably adjusted in this respect. The silver dollar, for instance, a favorite coin of the native Indian and distant Asiatic, has well-nigh disappeared from domestic circulation, to reappear among the eastern peoples, with whom we more than ever seek close intimacy.
"As they prefer this piece we do well to increase rather than discontinue its coinage, for we must not deprive ourselves of the advantages which its agency wil1 afford, and `it would be useless to send dollars to Asia inferior in weight and value to its well-known Spanish and American prototype.' "
Mr. Ruggles says that nearly all the silver coined in the United States prior to 1858 has disappeared. A remedy is not to be found in the adoption of a system that undervalues this metal, for that commodity, like any other, shuns the market where not taken at its full value to find the more favorable one.
It is a favorite metal, entering into all transactions of daily life, and deserves proper recognition in the monetary system.
"It is said that `To promote the intercourse of nations with each other, uniformity in weights, coins, and measures of capacity is among the most efficacious agencies.' Our weights, coins, and measures now correspond much more nearly to the English than to the French standard. Our commerce with Great Britain is nine times greater than with France, and if the former does not adopt the Paris system of coinage - and we have no assurance that she will - the United States would certainly commit a serious error in passing this bill. No argument is needed to enforce this. And what of the rising communities? A properly adjusted coinage would stimulate commerce with those great parts of the continent lying south end southwest
of us, with the West Indies and the countless millions of trans-Pacific countries. We stand midway on the thoroughfare of traffic between these two widely-separatcd races. Our railways, canals, our natural highways and merchant marine may be made to control their carrying trade.
"But here, as everywhere else, a well-adjusted coinage becomes a wand of power in the hand of enterprise. Tokens are not wanting to mark the favor in which the United States are held by China. The unusual honor recently conferred by that government upon a citizen of this country was not alone because of his fitness as an ambassador at large, but was a mark as well of a friendly disposition toward this country. Future harmony of intercourse is assured, too, by their adoption as a textbook in diplomatic correspondence of a leading American authority on international law. Much might also be said about the growing partiality of Japan towards this country, but it is enough that the recent opening of certain ports indicates an enlightened change in the politics of these two old empires, of which commerce, especially our own, is availing itself."
This patriotic document pilloried the rascality of that scheme, which would destroy the immense mineral wealth of the western hemisphere by the destruction of silver money.
Further on in the same report, Senator Morgan exposes the fallacy of this so-called international system of coinage embodied in the Sherman bill. The genuine Americanism of his nature is finely illustrated by the concluding language of that celebrated report.
He continues: -
"Oar coinage is believed to be the simplest of any in circulation, and every way satisfactory for purposes of domestic commerce; it possesses special merits of every-day value, and should not, for light reasons, be
exchanged where the advantages sought to be gained are mainly theoretical, engaging more properly the attention of the philosopher than the practical man. The instincts of our people lead them to believe that we are on the eve of important business changes, and we may therefore safely hold fast for the present to what experience has proven to be good, following only where clear indications may lead, and a future of great prosperity opens to our country.
"The war gave us self-assertion of character, and removed many impediments to progress; it also proved our ability to originate means to ends. Its expensive lesson will be measurably lost if it fails to impress upon us the fact that we have a distinctive American policy to work out, one sufficiently free from the traditions of Europe to be suited to our peculiar situation and the genius of our enterprising countrymen.
"The people of the United States have been quick to avail themselves of their natural advantages. Not only the public lands and the mines of precious metals, but our political institutions, have likewise powerfully operated in our favor, and will continue to do so with increasing force." - (Senate Report, Com, No. ll7, 40th Congress, 2d Sess., Page 13.)
Judging from the language of the report just quoted, the great Senator from the Empire state was a firm believer in the power of the American people to legislate upon domestic financial questions without the aid or consent of foreign powers and potentates.
Were he alive at the present day, how his indignation would be aroused at the successive journeyings to England by American monetary commissioners, who have humiliated our national self-respect by getting down on their knees before the "Old Lady of Thread Needle Street," London, and begging for her assistance in the solution of our financial problems.
The report of Senator Morgan was the death knell of
the bill, and no attempt was made to bring it up again while Mr. Morgan was a member of the Senate.
After the retirement of Mr. Morgan from the United States Senate, March 4, 1869, a revision of the mint laws was undertaken.
Mr. Boutwell, Secretary of the Treasury, John J. Knox, Deputy Comptroller of the Currency, and Mr. Linderman, Director of the mint, all of whom were devoted adherents of the nationa1 banking system, and a single standard of gold, framed a bill containing seventy-one sections, the object of which was ostensibly a revision of the mint laws of the United States.
On April 25, 1870, this bill, prepared by the Treasury clique, was transmitted by Secretary Boutwell to John Sherman, chairman of the Finance Committee, with a recommendation that it be adopted by Congress.
Nowhere in the report of Secretary Boutwell, which accompanied this bill, was any mention made of any change in the system of coinage, but he called it, "A bill revising the laws relative to the mint, assay office, and coinage of the United States."
This proposed measure, which purported to be a mere codification of the mint laws, in reality provided for the demonetization of the silver dollar.
On the 28th of April, 1870, the bill was introduced into the United States Senate by Mr. Sherman, and was referred to the Committee en Finance.
On December 19, 1870, it was reported back to the Senate with amendments.
On January 9,1871, the bill came up in the Senate and was discussed in Committee of the Whole.
That the reader may understand the process by which legislation can be surreptitiously pushed
through Congress, it must be borne in mind that the various committees of the Senate and House of Representatives have immense power to control the passage of laws.
A measure is introduced into either branch of Congress, it is referred to the appropriate committee which takes charge of the bill, considers it in all its phases, and makes a report for or against its passage. The rcport of the committee, in a majority of cases, is the foundation of the action of that branch where it was originally proposed.
Therefore, it is the various committees of Congress which exert a powerful influence upon the fate of bills, as such reports are generally taken to be absolutely true by the members of that body.
The bill as amended passed the Senate on the 10th of January,
1871 and on the 13th of the same month it reached the House and was ordered to be printed.
On February 25, 1871, Mr. Kelley, chairman of the Committee on Coinage, reported the bill beck with an amendment, in the nature of a substitute, when it was again printed and re-committed.
The bill was never heard of at that session and it never was debated in the House for a single moment.
On March p, 1871, Mr. Kelley introduced a bill in the Forty-second Congress, when it was ordered to be printed, and referred to the Committee on Coinage when appointed.
On January 9, 1872, the bill was reported by Mr. Kelley, chairman of the Coinage Committee, with the recommendation that it pass.
In the report made by Mr. Kelley to the House, the general objects of the bill were pointed out by him.
He informed the House that it had been prepared in the Treasury Department for the purpose of codifying and simplifying the mint laws, He stated to the House that the most important change made by the bill was that creating a Director of the mint, with headquarters in the Treasury Department. Mr. Maynard, a member of the Committee on Coinage, made the following statement of the scope of the bill; viz.: -
"This bill is symmetrical in all its parts; it is a mere revision of the mint laws, suggested by the Secretary of the Treasury, and concurred in by every man who sees the difficulty of managing mints and assay offices, scattered over this country as they are, without having a responsible head. Its sole function is to so codify the laws, and to appoint a responsible head under the Secretary of the Treasury."
On the 10th of January, 1872, the House resumed consideration of the bill, and it was finally re-committed to the Committee on Coinage, Weights, and Measures for a report. The committee reported the bill to the House on April 9, 1872.
Mr. Hooper, of Massachusetts, who was in charge of the bill, made a lengthy explanation of its provisions, and the only allusion made by him with reference to the silver dollar is the following; viz.: -
"Section 16 re-enacts the provisions of existing laws defining the silver coins and their weights, respectively, except in relation to the silver dollar, which is reduced in weight from 412 1/2 to 384 grains; thus mating it a subsidiary coin in harmony with the silver coins of less "denomination, to secure its current circulation with them. The silver dollar of 4121/2 grains, by reason of its bullion and intrinsic value being greater than its nominal value, long since ceased to be a coin of circulation, and is melted by manufacturers of silverware. It docs not circulate now in commercial transactions
with any country, and the convenience of thosc manufacturers in this respect can better be met by supplying small stamped bars of the same standard, avoiding the useless expense of coining the dollar for that purpose. The coinage of the half dime is discontinued, for the reason that its place is supplied by the copper-nickel g-cent piece, of which a large issue has been made, and which, by the provisions of the act authorizing its issue, is redeemable in United States currency." - (See Cong. Globe, Part 3, Page, 2,306 2d Sess., 42d Congress.)
Mr. Hooper correctly stated the weight and fineness of the dollar contained in the bill pending, and as it finally passed the House, but he does not state that it was a legal tender for only five dollars. From the tenor of his remarks and the character of his argument, it could have been justly inferred that the purpose of this bill was to reduce the weight of the silver dollar so that it would circulate on a parity with that of gold, as at this time the value of the silver dollar exceeded that of gold by a fraction over three per cent.
During the debate on the bill, Hon. Clarkson N. Potter, member of Congress from New York, opposed its passage in a speech of great length.
The speech of Mr. Potter excited a very warm controversy, and those who were urging the passage of the bill, seeing the determined and aggressive opposition brought to bear against it, professedly abandoned it, end brought in a substitute which they asserted was entirely free from the objections brought against the original measure.
On the 27th of May, 1872, Mr. Hooper obtained the floor and made a statement as follows; viz.: -
"I desire to callup the bill (H. R., No. 1,427) revising and amending the laws relative to mints, assay
offices, and coinage of the United States. I do so for the purpose of offering an amendment to the bill in the nature of a substitute, one which has been very carefully prepared, and which I have submitted to the different, gentlemen in this House who have taken a special interest in the bill. I find that it meets with universal approbation in the form in which I offer it. I move that the rules bc suspended and that the substitute be put on its passage."
Mr. Brooks: I ask the gentleman from Massachusetts [Mr. Hooper] to postpone his motion until his colleague on the committee, my colleague from New York Mr. Potter] is in his seat.
Mr. Hooper, of Massachusetts: It is so late in the session that I must decline waiting any longer.
Mr. Brooks: I would again suggest to the gentleman that he should wait until my colleague comes in.
Mr. Hooper, of Massachusetts: I cannot do so.
Mr. Holman: I suppose that it is intended to have the bill read before it is, put on its passage.
The Speaker: The Substitute will be read.
Mr. Hooper, of Massachusetts: I hope not. It is a long bill, and those who are interested in it are perfectly familiar with its provisions.
Mr. Kerr: The rules can not be suspended so as to dispense with the rending of the bill?
The Speaker: They can be.
Mr. Kerr: I want the House to understand that it is attempted to put through this bi1l without being read.
The Speaker: Does the gentleman from Massachusetts [Mr. Hooper] move that the reading of the bill be dispensed with?
Mr. Hooper of Massachusetts: I will so frame my motion to suspend the rules that it will dispense with the reading of the bill.
The Speaker: The gentleman from Massachusetts moves that the rules be suspended and that the bill pass, the reading thereof being dispensed with.
Mr. Randall: Can not we have a division of that motion?
The Speaker: A motion to suspend the rules cannot be divided.
Mr. Randall: I should like to have the bill read, although I am willing that the rules shall be suspended as to the passage of the bill.
The question was put on suspending the rules and passing the bill without reading; and (two-thirds not voting in favor thereof) the rules werc not suspended.
The Congressional Record from which he have quoted is proof that it was a cunning move on the part of Mr. Hoopcr to push a measure through the House during the closing hours of its session, and that he sought to do this during the temporary absence of those members who were aware of his plan, and who were opposed to the consummation of the scheme. This unscrupulous tool of the money power did not even want this bill read so that its contents would become known, as that would defeat its passage.
In this dilemma, Mr. Speaker Blaine came to the rescue of Mr. Hooper, and suggested to the latter that he move the suspension of the rules, so that the bill could be passed without reading.
The suggestion of Speaker Blaine was promptly acted on by Mr. Hooper, but the motion to suspend the rules and pass the bill without reading failed for want of a two-thirds vote.
Mr. Hooper thereupon moved that the substitute be read, that the rules be suspended and the bill passed, which action had been prompted by Speaker Blaine.
We give the proceedings of the House verbatim; viz.;
Mr. Hooper, of Massachusetts: I now move that the rules be suspended, and the substitute for the bill
in relation to mints and coinage passed; and I ask that the substitute be read.
The clerk began to read the substitute.
Mr. Brooks: Is that the original bill?
The Speaker: The motion of the gentleman from Massachusetts [Mr. Hooper] applies to the substitute, and that on which the House is called to act is being read.
Mr. Brooks: As there is to be no debate, the only chance we have to know what we are doing is to have both the bill and the substitute read.
The Speaker: The motion of the gentleman from Massachusetts being to suspend the rules and pass the substitute, it gives no choice between the two bills. The House must either pass the substitute or none.
Mr. Brooks: How can we choose between the original bill and the substitute unless we hear them both read?
The Speaker: The gentleman can vote "aye" or "no" on this question. Whether this substitute shall be passed.
Mr. Brooks: I am very much in the habit of voting "no" when I do not know what is going on.
Mr. Holman: Before the question is taken up on suspending the rules and passing the, bill, I hope the gentleman from Massachusetts will explain the leading changes made by this bill in the existing law, especially in reference to the coinage. It would seem that all the small coinage of the country is intended to be recoined.
Mr. Hooper, of Massachusetts: This bill makes no changes in the existing law in that regard. It does not require the recoinage of the small coins." - (Cong. Globe, Part 5, Page 3,883, 2d Sess., 42d Congress.)
The question being taken upon the motion of Mr. Hooper, the rules were suspended by an aye and nay vote and the bill passed.
The scheme was forced through the House by the
downright falsehoods of Samuel Hooper, a banker of Boston, aided by the trickery and the manipulation of parliamentary rules by Mr. Speaker Blaine.
The facts in the case were, that the provisions of the original bill abandoned by Mr. Hooper, and those of the substitute afterward passed, were practically the same.
The bill was now transmitted to the Senate where it went into the hands of the Finance Committee, which, on December 16, 1872, reported the bill back with amendments.
On January 7, 1873, additional amendments were reported which were ordered to be printed with the bill.
Section 16 of the substitute passed by the House was in the following language, viz.: -
"That the silver coins of the United States shall be a dollar, a half dollar or 50-cent piece, a quarter dollar or 25-cent piece, and a dime or 10-cent piece; and the freight of the dollar shall bc 384 grains; the half dollar, quarter dollar, and the dime shall bc, respectively, one-half, one-quarter and one-tenth of the weight of said dollar, which coins shall be a legal tender, at their nominal value, for any amount not exceeding five dollars in any one payment."
This section of the substitute was identical with that of the original bill which was withdrawn by Mr. Hooper; and it will be seen that silver was demonetized by its provisions, by which the free and unlimited coinage thereof was taken array from that metal, and its legal tender debt paying power limited to the insignificant sum of five dollars for any one payment.
Section 15 of the substitute passed by the House was stricken out by the Finance Committee of the Senate
in the way of amendment. When the question on the amendment striking out section r g was before the Senate it was agreed to by that body. The next amendment was to strike out the word seventeen in the 17th section of the substitute, and this amendment made section 17 of the substitute, read 16 of the bill as amended by the Senate.
The number of each succeeding section was changed accordingly.
The several sections of the substitute were taken up in their changed numeral order until section 19 of the substitute as passed by the House was reached, which, by the striking out of section 15 of said substitute, became section 18 of the amended Senate bill.
This latter section provided for the inscription and mottoes to be impressed upon the coins to be issued under this bill.
A debate arose upon this question, and Senator Casserly, of California, called attention to the omission of the eagle upon the gold dollar, three dollar gold piece, the silver dollar, half dollar and quarter dollar.
Senator Sherman gave the following explanation;
Mr. Sherman: "If the Senator will allow me, he will see that the preceding section provides for coin which is exactly interchangeable with the English shilling and the 5-franc piece of France; that is, a 5-franc piece of Franco will be the exact equivalent of a dollar of the United States in our silver coinage; and in order to show this wherever our silver coin shall float-and we are providing that it shall float all over the world- we propose to stamp upon it, instead of our eagle, which foreigners may not understand, and which they may not distinguish from a buzzard or some other bird, the intrinsic fineness and weight of the coin." - (Cong.
Globe, Part I, Page 672, 3d Sess., 42d Congress, 1872-73.)
This public declaration of Senator Sherman, in reply to the question of Senator Casserly, is one of the mysteries of this transaction. He had charge of this bill, and the Congressional Globe shows that what afterward became section 15 of the bill as amended by the Senate was never read nor acted upon by that body.
The French 5-franc piece, about which Mr. Sherman spoke in his reply to Senator Casserly, was the equivalent of a silver dollar containing 384 grains of silver, mentioned in section 16 of the substitute, now section 15 of the amended bill before the Senate.
In 1874, upon the discovery of the demonetization of silver, said section 15 of the amended Senate bill, which was now the lair, was ascertained to read as follows: -
"The silver coins of the United States shall be a trade dollar, a half dollar, or 50-cent piece, a quarter dollar, or 25-cent piece, a dime, or 10-cent piece; and the weight of the trade dollar shall be 420 grains troy; the weight of the half dollar shall be 12 grams and one-half of a gram; the quarter dollar and the dime shall be, respectively, one-half and one-fifth of the freight of said half dollar; and said coins shall be a legal tender at their nominal value for any amount not exceeding five dollars in any one payment."
That this section of the coinage law, providing for the mintage of a trade dollar containing 420 grains of silver, was not in the bill when the debate arose upon the inscriptions and mottoes designed to be placed upon the coins provided for by this act, is evident from the answer made by Sherman to the inquiry of Mr. Casserly; for the reason that the debate arose over section 18 of the amended bill, while the provi-
sion for the coinage of silver was embraced in the preceding section 15 of the amended act. Said section 15 was formerly 16 of Mr. Hooper's substitute.
The parliamentary procedure in the consideration of bills in both Houses of Congress is to read each section separately, take a vote upon its passage, and thus act upon each section consecutively.
The bill so amended went to the House of Representatives for its concurrence in the Senate amendments.
Speaker Blaine appointed Messrs. Hooper and Stoughton as the Committee of Conference on the part of the House; Senators Sherman, Scott, and Bayard, three of the most radical single gold standard men in Congress, were appointed conferees on the part of the Senate.
The Conference Committees met, and, with the exception of a few trifling amendments, agreed to the provisions of the bill as it came from the Senate. They made their reports to their respective Houses, and the bill became a law on the 12th of February, 1873.
We now come to a singular act on the part of Sherman when the bill came up for final passage in the Senate.
During his career as chairman of the Finance Committee of the Senate, wc have seen him in the city of London, in 1867, next he appears at Paris in the same year, and throws his influence in behalf of the single standard of gold, then he introduces a bill in Congress in 1868 for the demonetization of silver. Afterward, during the year 1870, he brings forward the bill framed by Secretary Boutwell, of which mention has been made heretofore. He reports bill after bill for the adoption
of a single standard of gold, and now he votes against the act of February 12, 1873, which was finally the fruition of his efforts.
This incomprehensible action is the strangest episode in the long public career of the Great Demonetizer, and many explanations have been volunteered for this apparently inconsistent conduct.
In a speech in the United States Senate, Mr. Sherman attempted the following explanation of his coarse which led to the demonetization of the silver dollar, he says: -
"The old silver dollar was dropped out, in the revision, and why? Simply because it was not in use. No law repealed the silver dollar; it was simply dropped out - there was no such coin in use. It could not circulate because, in 1872 and 1873, the silver dollar was worth more than the gold dollar. As it had not been coined for twenty years it was dropped out from among the coins of the United States."
With his consistent and usual disregard of facts, Senator Sherman avers that no silver dollars had been coined for the period of twenty years prior to the demonetization act of February 12, 1873. This statement was made in the face of the official report of the director of the United States mint for the year 1873, in which it is shown that 1,ll7,136 standard silver dollars were coined in the calendar year of 1871, that 1,ll8,600 were coined in the year 1872, and in the one month and twelve days from January 1, 1873, to February 12, 1873,296,000 of standard silver dollars were coined.
The excuse tendered by Mr. Sherman for the passage of the act of February 12, 1873, is that the silver dollar was worth more than the gold dollar. The si1-
ver dollar so "dropped out" contained 412 1/2 grains of silver. Now, if the reasons stated by Mr. Sherman for the omission of the coinage of the silver dollar by that act were valid and controlled his action, why did the honorable Senator amend that act in committee by increasing the number of grains in the silver dollar to 420, thus making its bullion value greater than before the passage of this act?
His strange logic is as follows: First, prior to its demonetization, the silver dollar was more valuable than that of gold, hence it would not circulate; therefore, as a remedy to increase its circulation, the value of the bullion in the silver dollar must be made greater.
In other words, the silver dollar was worth three and one-fourth cents more than that of gold and the former was hoarded or sold abroad; therefore, to obviate this difficulty in the way of increasing the circulation of that dollar, the weight was increased from 4l2 1/2 to 420 grains, and its overvaluation from three and one-fourth cents to five cents.
With such sophistry as the above, Mr. Sherman sought to delude the American people.
The manner in which the act of February 12 1873, was slipped through both Houses of Congress has excited endless controversies which rage even to this day.
Senator Sherman, in his speech of August 30, 1893, made a labored defense of his conduct during the passage of the bill demonetizing silver. He asserts that the measure was fully and thoroughly debated, but the Congressional Globe of that period conclusively proves that such was not the fact.
On the other hand, many Senators and Representatives of long service in Congress, including the sessions of 1870-71-72-73, renowned for their ability and integrity, have declared time and again that false statements were made by those having charge of the bill, that these statements were relied on by the various members, and that those who voted for the measure never knew or even suspected that silver would bc demonetized by its passage.
The public men making these statements bear such high reputation for truth and integrity, that their testimony does not require the sanction of an oath to carry conviction.
One exceedingly strong circumstance that adds great weight to the charge of fraud in the passage of the act of February 12, 1873, lies in the fact that Senators Nye and Stewart, who represented the state of Nevada - the greatest silver producing territory in America - voted in favor of the bill.
Will any sane person suppose that these two Senators would knowingly vote for a measure which would ruin the immensely rich silver mines of that state that had honored then by an election to the United States Senators
It is preposterous.
The following statements of leading members of Congress furnish a solution to this memorable controversy.
Mr. Holman, in a speech delivered in the House of Representatives July 13, 1876 said, with reference to the act of February in, 1873: -
"I have before me the record of the proceedings of this House on the passage of that measure, a record
which no man can read without being convinced that the measure and the method of its passage through this House was a `colossal swindle.' I assert that the measure never had the sanction of this House, and it does not possess the moral force of law." - (Cong. Record, Vol. IV, Part 6, Appendix, Page 193, 1st Sess., 44th Congress.)
This is the statement of a man renowned as the "Watch Dog of the Treasury," and whose vigilance during his long career in Congress has saved the nation hundreds of millions of dollars.
Mr. Birchard, a republican member of Congress from Illinois, in a speech in the House on July 13, 1876, said: -
"The coinage act of 1873, unaccompanied by any written report upon the subject from any committee, and unknown to the members of Congress, who without opposition allowed it to pass under the belief, if not assurance, that it made no alteration in the value of the current coins, changed the unit of value from silver to gold." - (Same Cong. Record, Page 4,560.)
Mr. Cannon, a republican member of Congress from the same state, in a speech on July 13, 1876, said: -
"This legislation was had in the Forty-second Congress, February 12, 1873, lay a bill to regulate the mints of the United States, and practically abolish silver as money by failing to provide for the coinage of the silver dollar. It was not discussed, as shown by the Record, and neither members of Congress nor the people understood the scope of the legislation." - (Same Cong. Record, Appendix, Page 197.)
Again on August 5, 1876, Mr. Holman in speaking of that bill said: -
"The original bill was simply a bill to organize a Bureau of mines and coinage. The bill which finally
passed the House and which ultimately became a law was certainly not read in this Housc."
On the same day in the course of the same speech he said: -
"It was never considered before the House as it was passed. Up to the time the bill came before this House for final passage the measure had singly been one to establish a bureau of mines; I believe I use the term correctly now. It came from the Committee on Coinage, Weights, and Measures. The substitute which finally became a law was never read, and is subject to the charge made against it by the gentleman from Missouri [Mr. Bland], that it was passed by the House without a knowledge of its provisions, especially upon that of coinage.
"I myself asked the question of Mr. Hooper, who stood near where I am now standing, whether it changed the law in regard to coinage. And the answer of Mr. Hoopcr certainly left the impression upon the whole House that the subject of coinage was not affected by that bill." - (Cong. Record, Vol. IV, part 6, Page 5,237, 1st Sess., 44th Congress.)
Mr. Bright, of Tennessee, said of this law: -
"It passed by fraud in the House, never having been printed in advance, being a substitute for the printed bill; never having been read at the Clerk's desk, the reading having been dispensed with by an impression that the bill made no material alteration in the coinage laws; it was passed without discussion, debate being cut off by operation of the previous question. It was passed to my certain information, under such circumstances that the fraud escaped the attention of some of the most watchful as well as the ablest statesmen in Congress at that time.... Aye, sir, it was a fraud that smells to heaven. It was a fraud that will stink in the nose of posterity, and for which some persons must give account in the day of retribution," - (Cong. Record, Vol. VII, Part 1, Page 584, 2d Sess. 45th Congress.)
Senator Allison, on February 15, 1878, when House bill 1,093, to authorize the free coinage of the standard silver dollar, and to restore its legal tender character was under consideration, stated:
"But when the secrct history of this bill of 1873 comes to be told, it will disclose the fact that the House of Representatives intended to coin both gold and silver, and intended to place both metals upon the French relation instead of on our own, which was the true scientific position wit)i reference to this subject in
1873, but that the bill afterward was doctored, if I may use that term, and I use it in no offensive sense of course -"
Mr. Sargent interrupted him and asked him what he meant by the word "doctored."
Mr. Allison said: -
"I said I used the word in no offensive sense. It was changed after discussion, and the dollar of 420 grains was substituted for it." - (Cong. Record, Vol. VII, Part 2, Page 1,058, 2d Sess. 45th Congress.)
Genera1 Garfield, in a speech made at Springfield, Ohio, during the fall of 1877,said: -
"Perhaps I ought to be ashamed to say so, but it is the truth to say that, I at that time being Chairman of the Committee on Appropriations, and having my hands overfull during all that time with work, I never read the bill. I took it upon the faith of a preeminent democrat and a prominent republican, and I do not know that I voted at all. There was no call of the yeas and nays, and nobody opposed that bill that I know of. It was put through as dozens of bills are, as my friend and I know, in Congress, an the faith of the report of the chairman of the committee; therefore I tell you, because it is the truth, that I have no knowledge about it." - (Cong. Record, Vol. VII, Part 1,Page 989, 2d Sess., 45th Congress.)
Senator Howe, in a speech delivered in the Senate on February 5, 1878, said: -
"Mr. President, I do not regard the demonetization of silver as an attempt to wrench from the people more than they agree to pay. That is not the crime of which I accuse the act of 1873. I charge it with guilt compared with which the robbery of two hundred millions is venial."- (Cong. Record, Vol. VII, Part 1, Page 754, 2d Sess., 45th Congress)
Senator Thurman, on the 15th of February, 1878, in debate said: -
"I can not say what took place in the House, but know when the bill was pending in the Senate we thought it was simply a bill to reform the mint, regulate coinage, and fix up one thing and another, and there is not a single man in the Senate, I think, unless a member of the committee from which the bill came, who had the slightest idea that it was even a squint toward demonetization." - (Cong. Record, Vol. VII, Part 2, Page 1,064 2d Sess., 45th Congress.)
Mr. Kelley, a republican member of Congress from Pennsylvania, in a speech delivered in the House in 1879, in speaking of the act of February 12,1873, said: -
"All I can say is that the Committee on Coinage, Weights, and Measures, who reported the original bill, were faithful and able, and scanned its provisions closely; that as their organ I reported it; that it contained provision for both the standard silver dollar and the trade dollar. Never having heard until a long time after its enactment into law of the substitution in the Senate of the section which dropped the standard dollar, I profess to know nothing of its history; but I am prepared to say that in all the legislation of this country there is no mystery equal to the demonetization of the standard silver dollar of the United States. I have never found a man who could tell just how it came about or why." - (Cong. Record, Vol. IX, Part 1, Page 1,231, 1st Sess., 46th Congress,)
President Grant was also ignorant of the demonetiza-
tion of silver. Eight months after the passage of the bill, he wrote a letter to Mr. Cowdrey, from which the following extract is taken: -
"The panic has brought greenbacks about to a par with silver. I wonder that silver is not already coming into the market to supply the deficiency in the circulating medium. When it does come, and I predict that it will soon, we will have made a rapid stride toward specie payments. Currency will never go below silver after that. The circulation of silver will have other beneficial effects. Experience has proved that it takes about forty millions of fractional currency to make small change necessary for the transaction of the business of the country. Silver will gradually take the place of this currency, and, further, will become the standard of values which will be hoarded in a small way. I estimate that this will consume from two to three hundred millions, in time, of this species of our circulating medium.
"It will leave the paper currency free to perform the legitimate functions of trade and will tend to bring us back where we must come at last, to a specie basis. I confess to a desire to see a limited hoarding of money. It insures a firm foundation in time of need. But I want to see the hoarding of something that has a standard of value the world over. Silver has this, and if we once get back to that our strides toward a higher appreciation of our currency will be rapid. Our mines are now producing almost unlimited amounts of silver, and it is becoming a question, 'What shall we do with it?' I suggest herc a solution that will answer for some years, and suggest to you bankers whether you may not imitate it: To put it in circulation noir; keep it there until it is axed, and then we will find other markets."- (McPherson's Hand Book of Politics for 1874, Pages 134-135.)
It has been charged time and again, that Ernest Seyd, the emissary of the London money power, was
in this country at the time of the demonetization of silver, and that he used the vast sum of $5oo,ooo with which to corrupt Congress and to secure its demonetization.
On the 3oth of August, 1893, Senator Sherman, in a speech urging the repeal of the purchasing clause of the Sherman Law of July 14, 1890, took occasion to severely denounce the charge as utterly false.
But as evidence that some mysterious influence was brought to bear upon certain members of Congress, wc produce the following language taken from the report upon the bill which demonetized silver. This report was written by Mr. Hooper who was in charge of that bill, and who was so persistent in engineering its passage through the Forty-Second Congress That rcport contains the following statement; via: -
"The bill was prepared two years ago, and has been submitted to careful and deliberate examination. It has the approval of nearly all the mint experts of the country and the sanction of the Secretary of the Treasury. Ernest Seyd, of London, a distinguished writer and bullionist, is now here, and has given great attention to the subject of mints and coinage, and after examining the first draft of the bill made various sensible suggestions, which the committee accepted and embodied in the bill. While the committee take no credit to themselves for the original preparation of this bill, they have no hesitation in unanimously recommending its passage as necessary and expedient."
Here is a direct admission that Ernest Seyd, a citizen of England, was in this country at the time that the first steps were taken in the drafting of that bill which aimed at the striking down of the time-honored silver dollar, and the passage of which meant the destruction of the valuable silver mines of the United
States, together with those of Mexico and South America.
Mr. Seyd was not here merely as a spectator, as the language of Mr. Hooper shows, for he says that this Englishman, "After examining the first draft of the bill made various sensible suggestions, which the committee accepted and embodied in the bill."
It will strike the average American citizen as singular that public men of the prominence of Samuel Hooper and John Sherman, members of the National Congress, should submit a great measure of such importance as this bill to the inspection and for the correction of its provisions by an alien who owed allegiance to Great Britain.
It is a remarkable coincidence that foreign nations, especially England, should exert such influence in the preparation and enactment of financial measures that came solely within the constitutional powers of an American Congress.
These striking coincidences of the constant meetings and consultations of Senator Sherman with the financiers of Great Britain, from the time of his visit to London, in 1867, down to the passage of that infamous act demonetizing silver, werc not the results of mere accident.
It has been affirmed, time and again, by the ablest Senators and Representatives of Congress, statesmen of unblemished honor, that the demonetization of silver in 1873 was the premeditated act of the combined money power of England and America.
This charge of a deeply laid and successful conspiracy has been openly and fearlessly made in the halls of Congress, and has not been met and over-
thrown The Congressional Records, published by authority of Congress, affords ample justification for this statement.
It is a historical fact that the financiers of Great Britain were mainly influential in procuring that great change in the coinage laws of this country, and Senator Sherman, who introduced the first bill providing for the demonetization of silver, and who ever since 1873 has exerted his immense prestige and influence against every measure providing for its restoration, in whole or in part, gives most conclusive evidence that such was the case.
To support this statement, we quote from his speech delivered before the Chamber of Commerce, of New York City, March 6, 1876, in which he made an elaborate argument against the resolution of that body in favor of repealing the Resumption Act of 1875.
In the course of his remarks, adverse to that course of the Chamber of Commerce, he said: -
"Our coinage act came into operation on the 1st of April, 1873, and constituted the gold one dollar piece the sole unit of value, while it restricted the 1egal tender of the new trade dollar and the half dollar and subdivisions to an amount not exceeding five dollars in one payment.
Thus the double standard previously existing divas finally abolished, and the United States as usual was influenced by Great Britain in making gold coin the only standard. This suits England, but does not snit us. I think with our large silver producing capacity we should return to the double standard, at least in part, and this will constitute one of the means by which we will be enabled to resume specie payments." - (Cong. Globe, Vol. IV, Part 2, Page 1,481, 1st Sess., 44th Congress.)
Is this not a plain admission by the chairman of the Finance Committee of the United States Senate, that Great Britain had wielded a great influence in procuring the demonetization of silver in 1873?
In connection with this deliberate public admission of Senator Sherman, let it be borne in mind that Samuel Hooper stated on the floor of the House of Representatives, that a citizen of England assisted in framing the bill which demonetized silver.
This speech of Senator Sherman was clothed with official authority, and he distinctly stated that, "The double standard previously existing was finally abolished, and the United States as usual was influenced by Great Britain in making gold coin the only standard. This suits England, but does not suit us."
In his elaborate address to the leading commercial body of America, Mr. Sherman avers that British influence was successful in securing legislation from an American Congress favorable to that country, and that "This suits England but does not suit us." This is equivalent to a charge of treason against Congress and the President, and implies corruption; for what American law-maker, however base, would voluntarily prostitute his power to the influence of a foreign state?
He makes an implied charge against the patriotism of that party of which he is a leader, for it held the presidency and a great majority of both Houses of the Federal legislature at the time the act which demonetized silver was placed upon the statute books. And nowhere during the debates upon that measure does he denounce those whom he alleges voted a bill through Congress to "suit England;" nowhere had he censured those who were influenced by Great Britain. The
query naturally presents itself - Did Great Britain influence Sherman to present the bill of June 9, 1868, which sought to demonetize silver? Was that to suit England?
Mr. Sherman knew whereof he spoke. It will be remembered that the first bill introduced in Congress to demonetize silver was that of the 9th of June, 1868, and it came fresh from the hands of Mr. Sherman.
Furthermore in his report advocating the passage of this bill, Mr. Sherman stated that "The single standard of gold is an American idea."
In his address to the Chamber of Commerce he asserts that the United States was influenced by Great Britain in adopting the single standard of gold.
No living man can reconcile the utterly inconsistent statements of this alleged statesman.
It was during this period, beginning with the year 1862 down to the year 1873, that so many gigantic scandals smirched the legislative record of Congress.
During the time covered by these years, the Federal. legislature gave away more than 2oo,ooo,ooo acres of the public domain to great railway corporations, in addition to a gratuity of United States bonds to the amount of $65,ooo,ooo; the Credit Mobilier rascality resulted from an exposure of the corruption of many distinguished members of Congress who sold thcir votes outright; the great whisky ring was all-powerful, and, in collusion with the treasury officials and revenue officers, swindled the government out of untold millions; the President, it is true, ordered Secretary Bristol "To let no guilty man escape," and then he nullified all prosecutions of the scoundrels by the
exercise of his pardoning power; Boss Shepherd reigned supreme at Wash-
ington; the "Salary Grab" and "Back Pay" schemes of plunder were brazenly pushed through Congress, while the Freedman's Bureau robbed the negro of his savings.
It would require pages to briefly summarize the history of the congressional and departmental scandals rife at the national capital.
The Washington correspondent of that leading republican journal, the Chicago Tribune, of the date of February 21, 1873, thus described the corruption prevalent at Washington. He says: "Turkish corruption under the pashas and beys, or Russian official rottenness, could scarcely be worse than it is here."
The public conscience was so aroused by these exposures and proofs of the boundless official corruption and debauchery, that, in the congressional elections of 1874 the republican party met with an overwhelming defeat, and the democracy carried the House of Representatives by a great majority.
Immediately after the demonetization of silver by the United States, Norway, Sweden, and Denmark closed their mints to silver and adopted the gold standard.
The Latin Union, however, still continued the unlimited coinage of silver for a brief period.
On September 6, 1873, the French government limited the amount of silver to be accepted at the mints for coinage.
To afford the reader an explanation of the closing of the mints to silver by France, we refer to the great Franco-Prussian war of 1870-71, brought on by the folly of Emperor Napoleon, who, to restore his waning influence over the French nation, declared war against Prussia, July 15, 1870.
In the brief period of two hundred and ten days, the armies of France were destroyed; her territory was over-run by the victorious Germans, and the nation lay prostrate under the heel of her bitterest enemy - Prince Bismarck
In the treaty of peace negotiated by Theirs on behalf of France, and Bismarck, on the part of Germany, the latter succeeded in imposing the most enormous burdens upon the French people.
The treaty of peace as finally agreed upon by France and Germany provided that the former should pay the latter the immense sum of 5,ooo,ooo,ooo francs ($1,ooo,-ooo,ooo), in gold as an indemnity for the expense of the war, payable in three installments, the last of which would fall due March 1, 1875.
In the meantime the French authorities were to support a German army of occupation until the money was paid.
Not satisfied with the exaction of this enormous indemnity, Bismarck compelled the French to cede to the German empire the two splendid provinces of Alsace and Lorraine.
It is said that the venerable and patriotic Theirs shed bitter tears when he signed this treaty, and that Bismarck smiled in derision at the humiliation of the Frenchman.
Up to the time of this treaty the German empire was on a silver basis, but, upon the payment of this enormous war indemnity, Bismarck, in the execution of his policy to cripple
France as much as lay in his power, procured the passage of a law through the German parliament which provided for the demonetization of silver.
This measure became a law July 9, 1873, and it established a national gold standard throughout Germany, and it further provided that the aggregate issue of silver coin should not, until further orders, exceed ten marks ($2.50), for each inhabitant of the empire, and that the silver in excess of this amount should be withdrawn from circulation and sold.
The evident object of this measure was the enhancement of the va1ue of the vast war indemnity received from France, and, by throwing a large amount of non-legal tender silver on the market, to force down its price, which, in effect, would depreciate the silver coinage of France and the other members of the Latin union, whose mints still remained open to the free and unlimited coinage of silver at a ratio of fifteen and one-half to one.
The shrewd statesmen of France at once penetrated the scheme of the wily Bismarck to debase the French coinage, and, therefore, on the 6th of September, 1873, the French government in a treasury order limited the amount of silver to be accepted by the mints.
In February, 1874, the Latin union states jointly closed their mints to the free coinage of silver, agreeing, however, to coin on government account such quantities as were fixed upon from time to time.
Such were the reasons that moved France to suspend the unlimited coinage of silver.
During the years of 1868, 1869, 1870, 1871, 1872, and 1873, the production of silver in the United States rapidly increased, while that of gold largely diminished.
In the last named year the production of silver reached the great sum of $35,75o,ooo, to the use of which as money was destroyed by the act of February 12, 1873.
Shortly after the demonetization of silver in the United States, a distinguished political economist of Europe urged this country to readopt the bi-metallic law, and he forcibly stated that it would, "Not only save the world at large from an abyss, and prevent the accomplishment of a stupid general crime, whose authors humanity would some day learn to curse, but that she would advance her own material interests more than may be supposed possible, and that she may perchance take the lead in the intelligent and prudent organization of firm monetary systems."
The destructive effects of the demonetizing act of 1873 upon the value of property was so great, that Hon. Alexander Stephens, one of the ablest and most conservative of American statesmen, declared that it was more disastrous to the American people than the total cost and destruction of that bloody and protracted war between the North and the South. He said: -
"A careful calculator told me the other day that shrinkage of values in this country after the fatal act was more than the whole expense of our war. That fatality was worse than war. There is no remedy for us now except in re-establishing the value of silver and its free coinage. We want $9oo,ooo,ooo in circulation, at least. We have now only fourteen dollars per capita in circulation, including all the hoarded gold and silver. We want at least twenty-five dollars per capita, or as much as we had before the crash of 1873. People fear the silver flood; I would let it come from all the world until we have a thousand millions in circulation."
The enormity of this crime, as stated by Mr. Stephens, can only be adequately gauged when it is borne in mind that the cost of the war of the Rebellion up to the time that he made that statement aggregated $8,000,000,000.
The process by which the value of bonds and of public debts was increased by legislation, both here and in Europe, and the value of other property was correspondingly depreciated, as measured by the exchange power of money, was shown by a paper read before the Society of Arts of London, by J. Barr Robertson, the value of which was so highly recognized by the United States government, that it was published on page 354 of the coinage laws of the United States.
Mr. Robertson says: -
"While it would take too much space to enter into details regarding the practical effects of this appreciation of gold, it will suffice to give some indication of the enormous injury it has inflicted, if it is stated that the transfer of wealth from the landed and propertied classes and from the mercantile, manufacturing, and producing classes generally in the United Kingdom to the holders of securities, mortgages, annuities, etc., can not be less than L2,000,000,000, due solely to the appreciation of gold.
"It is already a question how much further the holders of securities are to receive the assistance of a continually contracting currency to enable them to go on absorbing further and further the wealth of the producing classes. If no other relief can be obtained, it may be necessary to fix a commodity standard instead of a money standard for long-dated payments, as has been recommended by the principal economists of the last hundred years. Such a colossal unearned increment as has accrued to the holders of securities valued in gold during the last twenty years in Europe and the United States, amounting to not less than from L7,000-000,000 to L9,000,000,000, is entirely unparalleled in the history of the world, and all other public questions sink into utter insignificance compared with it."
Think of it! The demonetization of silver by the United States and Europe so enhanced the exchange
value of gold over other forms of property that it added $10,ooo,ooo,ooo to the wealth of the creditor classes of England; and from $35,ooo,ooo,ooo to $45,ooo,ooo,ooo to the accumulations of the creditor classes of Europe and the United States.
In speaking of the effects of the demonetization of silver, initiated in England by Lord Liverpool in 1815, later followed by the United States and Germany, and in describing the artificial increase of the value of money over all other species of property, and in pointing out the class who are the sole beneficiaries of that infamous system, Sir Moreton Frewen well said: -
"It may, indeed, be affirmed without fear of contradiction, the legislation arranged in the interest of a certain class, first by Lord Liverpool in this country, and again by Sir Robert Peel at the instigation of Mr. Jones Loyd and other wealthy bankers, which was supplemented recently by simultaneous anti-silver legislation in Berlin and Washington at the instance of the great financial houses. This legislation has about doubled the burden of all national debts by an artificial enhancement of the value of money.
"The fall of all prices induced by this cause has been on such a scale that while in twenty years the national debt of the United States quoted in dollars has been reduced by nearly two-thirds, yet the value of the remaining one-third, measured in wheat, in bar iron, or bales of cotton, is considerably greater, is a greater demand on the labor and industry of the nation than was the whole debt at the time it was contracted.
"The aggravation of the burdens of taxation induced by this so-called "appreciation of gold," which is no natural appreciation, but has been brought about by class legislation to increase the value of gold which is in few hands, requires but to be explained to an enfranchised democracy, which will know how to protect itself against further attempts to contract the
currency and force down prices to the confusion of every existing contract.
"Of all classes of middle-men, bankers have been by far the most successful in intercepting and appropriating an undue share of produced wealth. While the modern system of banking and credit may be said to be even yet in its infancy, that portion of the assets of the community which is to-day in the strong boxes of the bankers, would, if declared, be an astounding revelation of the recent profits of this particular business; and not only has the business itself become a most profitable monopoly, but its interests in a very few hands are diametrically opposed to the interests of the majority. By 1egislation intended to contract the currency and force down all prices, including wages, the price paid for labor, the money owner has been able to increase the purchase power of his sovereign or dollar by the direct diminution of the price of every kind of property measured in money."