S^Litte 
 
 Statesman 
 
 ARMSTRONG 
 
 THE ARIEL LIBRARY SERIES. Issued quarterly. N,i. .;. September. 
 
 $2.<X> per year. Entered at Chicago Post-office as second-class mail matter. 
 
 THE SCHULTE PUBLISHING CO. 
 
 334 Dearborn Street 
 CHICAGO
 
 THE 
 
 LITTLE 
 
 STATESMAN 
 
 presented to the 
 UNIVERSITY LIBRARY 
 UNIVERSITY OF CALIFORNIA 
 SAN DIEGO 
 
 by 
 
 JUDGE J.M. CARTER
 
 1 Don't throw your vote away." 
 
 * 
 
 The 
 
 Little 
 
 Statesman 
 
 A Hiddle-of-the-Road Manual for 
 American Voters.. 
 
 CDITCD BY 
 
 K. L. ARMSTRONG 
 
 ' This word to all when I am dead : 
 Be sure you're right; then go ahead." 
 
 Davy Crockett. 
 
 CHICAGO: 
 
 COPYRIGHT, 1895 
 
 THE SCHULTE PUBLISHING COMPANY
 
 SUMMARY OF CONTENTS. 
 
 A Short History of American Politics 9 
 
 The Steps in the Growth of American Lib- 
 erty Magna Charta The Declaration 
 
 of Independence, etc 34 
 
 The Constitution of the United States. ... 41 
 The New Declaratiop of Independence 
 
 The Omaha Platform 56 
 
 A New Study of Political Economy Based 
 
 on the Omaha Platform 61 
 
 Sectionalism in American Politics. . . 92 
 
 The Laws of Property 99 
 
 Interest and Usury 105 
 
 Debt and Slavery.... in 
 
 The Land Question 116 
 
 An Exposition of the Single Tax 120 
 
 Co-operation 142 
 
 Direct Legislation The Initiative and 
 Referendum Proportional Representa- 
 tion 150 
 
 The Philosophy of Money 1 57 
 
 A Bird's-Eye View of American Financial 
 
 History 177 
 
 The Eight Money Conspiracies 207 
 
 The Documentary Evidence 213 
 
 The Transportation Problem 220
 
 i "And the Lord said unto Moses, Wherefore cries t thou? 
 Speak unto the children of Israel that they go forward" 
 Exodus 14:15. 
 
 INTRODUCTION. 
 
 <%> 
 
 THE IMPENDING REVOLUTION. 
 
 purpose of this book is to present in compact form a 
 series of articles on politics and political economy from 
 the point of view of one who, realizing that a world-wide 
 economic revolution is imminent, hopes that this revolution 
 will be accomplished by reason and in peace, not by treason 
 and violence by book and ballot, not by bullet and bayonet. \ 
 It is not intended as a special plea for the doctrines of any par- 
 ticular school of economics, nor is it put forth as the official 
 utterance of any political party. The object is rather to place 
 in concrete the arguments and principles of the several 
 branches of Reform thought, which, while widely divergent in 
 respect of methods, have a common aim in the emancipation of 
 industry. Since practical economic reform is a propaganda and 
 not merely a school of abstract philosophy, there is need of 
 literature to assist the convert in choosing his new articles of 
 faith. On this line " The Little Statesman " is projected. 
 
 The many elements which make up the great and growing 
 army of Reform may be segregated into two divisions individ- 
 ualists and collectivists. In the early history of this nation 
 the men who had battled for its independence were similarly 
 divided into two great parties one advocating the centraliza- 
 tion of power in the national government, the other demand- 
 ing for each State sovereign independence. The flexibility of 
 our Constitution is ascribed to the wisdom of the fathers, who 
 sought out and adopted what was best in the ideas of both. 
 So out of the apparently conflicting elements of the reform 
 movement will come the ultimate solution of economic prob- 
 lems. 
 
 The editor is an individualist, not a collectivist or commun- 
 ist. The industrial commonwealth he believes to be imprac" 
 ticable, although he is in thorough sympathy with Socialism
 
 vi The Impending Revolution. 
 
 in so far as it advocates the public ownership of monopolies. 
 The people should own and operate the railroads, the telegraph, 
 the telephone, etc., as they already do the post-office. The 
 people should also own and operate street railroads, water- 
 works, gas-works, electric light plants, etc. The notorious 
 corruption of our law-making bodies is due almost wholly to 
 their power to grant special privileges and to sell public fran- 
 chises to private individuals or corporations. Legislative reform 
 that ignores the cause of corruption is never remedial and sel- 
 dom even palliative. Public ownership of natural monopolies 
 will abolish the bribe-taker by making impossible the bribe- 
 giver. 
 
 Complaint will be made of " The Little Statesman " 
 because, while it touches nearly every other question, no men- 
 tion is made of the customs tariff. The tariff is largely a local 
 issue upon which the plutocrats of the Republican party and 
 the plutocrats of the Democratic party have agreed to disagree 
 in order to prevent the discussion of vital questions. 
 
 One of these vital questions, and the one which presents 
 itself just now for immediate solution, is that of Money. The 
 attitude of the two leading parties on this subject furnishes a 
 most glaring instance of political dishonesty. In spite of the 
 efforts of the politicians, however, the money question will 
 not down, and that phase of it which appeals most strongly at 
 this time to the people is the proposition to again open the 
 mints to the free coinage of silver. 
 
 Money is the public credit, stamped or imprinted upon, or 
 represented by, metal, paper, or any other convenient substance 
 recognized by 1; w or usage, and employed as a medium of ex- 
 change and a measure of values. Money is money only so long 
 and in so far as it represents the public credit. Moses, as well as 
 the early fathers of the Christian Church, undoubtedly adopted 
 this view of money when they denounced usury, which is the de- 
 vice whereby the drones in humanity ' s bee-hive, monopolizing 
 the public credit, have in all ages exacted tribute from the 
 workers. 
 
 The right to issue money is a sovereign right and should be 
 jealously guarded by a sovereign people. To delegate this
 
 The Impending 'Revolution. vii 
 
 power to banks and money-lenders is as grave an error as it 
 would be to confer on a class the privilege of making laws for 
 the whole community 
 
 The volume of money should be regulated to suit the re- 
 quirements of all the people and not the greed of those who 
 thrive on usury. 
 
 The use of metals for money is unscientific, and they will 
 eventually be relegated to obscurity with the shells, pelts, 
 tally -sticks and other cumbrous mediums of exchange employed 
 by our ancestors. But great reforms cannot be accomplished 
 at once. Gold and silver are the money of the Constitution. 
 The Act of 1873, which demonetized silver and made gold alone 
 the basis of credit, and which, by reducing the volume of 
 money, doubled the burden of debt, was a violation of the 
 fundamental law of our government. 
 
 The wrong perpetrated by John Sherman in 1873 must be 
 righted now. This is the first great step in monetary reform. 
 
 Following this, the issue of interest-bearing bonds must be 
 stopped forever. The careful student will find that interest 
 usury is at the bottom of all our financial ills. Unselfish 
 patriotism must abolish usury by substituting the credit of all 
 the people for that of the banks. 
 
 Every physical or moral ill is the result of some breach of 
 natural or divine law. For generations we have violated the 
 laws of God as they relate to money and to land. 
 
 "And if thy brother be waxen poor and fallen in decay with 
 thee, then thou shalt relieve him; yea, though he be a stranger 
 or a sojourner; that he may live with thee. Take thou no usury 
 of him or increase; but fear thy God, that thy brother may live 
 with thee." (Lev. 25: 36-37.) 
 
 Moses, the inspired law-giver, the great soldier-poet-states- 
 man who led a semi-barbarous people from the slavery of 
 Egypt and made of them a nation which endured the longest 
 in the world's history, wrote these words. 
 
 We also read: "The land shall not be sold forever: for the 
 land is mine [saith the Lord] ; for ye are strangers and sojourn- 
 ers with me." (Lev. 25: 23.) 
 
 Let the Christian world cease bickering over questions of
 
 \ 
 
 viii The Impending Revolution. 
 
 dogma and study again the inspired law of Moses, the law 
 which Christ came to fulfill, and a solution of all the many 
 questions which now vex us will soon be found. 
 
 Under the Mosaic law, slaves were emancipated, human life 
 was made sacred, debtors were liberated every sever years, 
 inherited property was divided and paternal inheritances were 
 alienated, luxury and extravagance were discouraged, and by 
 forbidding land-monopoly and usury (in the Bible usury and 
 interest are synonymous) disproportionate fortunes and vast 
 accumulations of wealth, which have caused the decline of the 
 world's great empires and are now threatening the foundations 
 of modern civilization, were made impossible. 
 
 Chattel slavery no longer exists in any part of the civilized 
 world, imprisonment for debt has been abolisned, the right of 
 the people to rule is established, but humanity is still bound 
 in chains of servitude as galling and oppressive as in any period 
 of its history. The rule of kings is passing away, but the 
 autocracy of money and monopoly is seated on the throne 
 and swaying a more imperious scepter. 
 
 But the people have it in their power to overthrow their op- 
 pressors. Here in this coun try , at least, we have the ballot. The 
 duty of the hour is to study political economy, so that this 
 weapon may be wielded intelligently and effectively. " Edu- 
 cation ' ' must be our watchword. It is only by education that 
 we may hope to gain the three great essentials for perfect 
 liberty and equality: direct legislation direct money direct 
 taxation. These will establish forever the sovereignty of the 
 people. If this small volume serves, even in a slight degree, 
 to educate the beginner, to edify and encourage those who are 
 already enlightened, or to render more cohesive and homoge- 
 neous the sometime warring elements of economic reform, 
 the editor will feel that his reward is ample. 
 
 F. J. S. 
 
 CHICAGO, JANUARY, 1896.
 
 t "fie rules who reads" 
 
 A SHORT HISTORY OF AMERICAN POLITICS. 
 
 The Rise and Fall of Political Parties. 
 
 IT 18 only by the past that we may wisely judge the future. 
 To correctly foresee the possibilities of the great Reform 
 movement now in process of evolution we must know the 
 origin, growth and decadence, the promises and accomplish- 
 ments of political organizations since the United States became 
 an independent nation. 
 
 Until Thomas Paine's "Common Sense" appeared, the sub- 
 ject of American independence was almost tabooed. As late 
 as March, 1775, Franklin assured Pitt that, though he had 
 traveled in America, he had never heard any expression in 
 favor of independence. But men, women and children read 
 Paine's pamphlet. It liberated them from prejudice and gave 
 them fresh ideas and fresh courage. 
 
 Rhode Island was the first of the colonies to declare her- 
 self "free from all dependence on the crown of Great Britain." 
 This was on May 4, 1776. The Assembly of Virginia in the 
 same month instructed her delegates to the Continental Con- 
 gress to present to that body a proposition "affirming the inde- 
 pendence of the colonies from Great Britain." In compliance 
 with these instructions Richard Henry Lee, of Virginia, on 
 June 7, 1776, introduced his famous resolution: "That these 
 united colonies are, and of right ought to be, free and inde- 
 pendent States; that they are absolved from all allegiance to 
 the British crown; and that all political connection between 
 them and the state of Great Britain is, and ought to be, totally 
 dissolved. That it is expedient forthwith to take the most 
 effectual measures for forming foreign alliances. That a plan 
 of confederation be prepared and transmitted to the respective 
 colonies for their consideration and approbation." John Adams 
 seconded these resolutions, and an animated discussion en- 
 sued. On June 8, a committee, consisting of Thomas Jeffer- 
 son, John Adatns, Benjamin Franklin, Roger Sherman and 
 Robert R. Livingston, was appointed to draw up a declaration 
 
 9
 
 10 A History of American Politics. 
 
 of independence embodying the sense of Lee's resolutions. On 
 July 2, Lee's resolutions were passed by the vote of twelve of 
 the thirteen colonies, the New York delegates refraining from 
 voting for want of instructions from their province. On July 
 3, the formal declaration, almost precisely as written by 
 Thomas Jefferson, was presented by the committee above 
 named, and was debated with great spirit, John Adams being 
 the chief speaker on the part of the committee. The discussion 
 was resumed on the morning of the 4th, and at 2 o'clock in the 
 afternoon, after one or two slight modifications, it was adopted. 
 The announcement was hailed with the liveliest enthusiasm. 
 "Ring! ring!" shouted the lad stationed below to give the signal 
 to the old bellman in the State-house tower; and he did ring 
 until the whole city shouted for joy. The King's arms were 
 wrenched from the Court-house and burned in the streets; 
 bonfires were lighted, the city illuminated, and the exultation 
 was prolonged far into the night. In New York City the 
 populace hurled the leaden statue of George III. from its 
 pedestal and molded it into bullets, and in all the great cities 
 similar demonstrations of enthusiasm were exhibited. 
 
 The Declaration of Independence was signed Aug- 
 ust 2, 1776, when President John Hancock said: "There must 
 be no pulling different ways, we must all hang together," to 
 which Franklin replied, "Yes, we must all hang together, or 
 we shall all hang separately." 
 
 State constitutions were adopted in the same year as fol- 
 lows: By New Jersey (July 2), Virginia (July 5), Pennsylvania 
 (July 15), Maryland (Aug. 14), Delaware (Sept. 20), North Caro- 
 lina (Dec. 18). 
 
 New York, South Carolina and Georgia adopted constitu- 
 tions in 1777, Massachusetts in 1780, and New Hampshire in 
 1781. Connecticut and Rhode Island continued to use their 
 royal charters until 1818 and 1840, respectively. Few of the 
 State constitutions admitted religious liberty. That of Massa- 
 chusetts provided against luxury, plays, extravagance in dress, 
 diet, and the like, nd every minister in the State was obliged
 
 A History of American Politics. 11 
 
 to read the constitution to his congregation once a year. 
 
 1778 Independence of United States acknowledged by 
 Prance by a treaty of alliance and commerce. 
 
 1779 Naval victory of John Paul Jones. 
 
 1781 A French fleet in aid of the United States drives the 
 British from Chesapeake Bay. Surrender of Cornwallis. 
 
 1782 Independence recognized by Holland. 
 
 1783 Independence acknowledged by Sweden, Denmark, 
 Spain and Russia, successively. Definite treaty of peace with 
 Great Britain, Sept. 3. 
 
 1789 Formation and adoption of the Constitution. 
 
 American politics begins properly with the close of the 
 Revolutionary war. When the British departed they left be- 
 hind them thirteen separate and independent States joined 
 together in a feeble confederation and governed as a whole, 
 so far as they would consent to be governed at all, by the in- 
 adequate Continental Congress. The finances were in a de- 
 plorable condition; the States were jealous of each other and 
 of the Congress. As everything was badly defined and unset- 
 tled, there were constant encroachments and abuses, and it 
 seemed that after achieving freedom America was about to 
 cast it away. 
 
 During the war of the American Revolution there were 
 two parties the Tories, who were English in sympathy 
 and held to the old doctrine of the divine right of kings to rule 
 the people, and the Whigs, who were American to the core 
 and whose platform of principles was the Declaration of Inde- 
 pendence. About the end of the first year of the war the 
 Whigs, inspired principally by the patriotic appeals of Frank- 
 lin, Jefferson and Paine, advanced to the bold ground of total 
 separation from Great Britain. The Tories, in turn, became 
 the supporters of the crown. Although all who favored Ameri- 
 can independence were politically known as Whigs, they were 
 subdivided into factions known as "Sons of Liberty," "Liberty 
 Men" and "Patriots," the latter being the men who took the 
 most active part in the prosecution of the war. 
 
 The Tory party drew to its ranks nearly all office-holders, 
 "loyal" pap-suckers, many lawyers, tenants of English land-
 
 12 A History of American Politics. 
 
 holders, and well-meaning but weak-kneed men who thought 
 that the Colonists had no chance very much like many 
 chicken-hearted third party men who vote the old party ticket 
 because they think the third party "has no chance." The 
 Patriots, however, made things decidedly warm and entertain- 
 ing for the Tories. Every art of persuasion, from tar and 
 feathers to a rope's end, was used to convince the Tories of the 
 error of their ways. At the close of the war many of them 
 were banished some of them returned to England and others 
 settled in Upper Canada. The more harmless ones were per- 
 mitted to remain in the country. 
 
 The success of the war ended the Tory party, but the 
 Whigs maintained their organization for some years. Then a 
 new party arose, formed largely out of the old Tory party 
 who, in fact, went into it as a class, and the more conservative 
 Whigs. This party was called the Federal Party and favored 
 a closer and lasting union in which the States should bind 
 themselves into a compact government. The opposing party 
 called themselves Aiiti- Federalists, and, while generally 
 admitting the need of a closer and more binding union, sought 
 to preserve the sovereignty and independence of the States. 
 Our Constitution and our form of government are the result of 
 the two opposing forces of these early days the radical 
 Whigs, who believed in the doctrine of "inalienable rights" for 
 all and in a liberal construction of the Constitution, and the 
 conservative Federalists, who did not believe in the doctrine 
 of equal rights and who regarded the new government rather 
 as an elective monarchy than as a republic. 
 
 It is impossible here to do more than outline the growth 
 of parties, but no man can be an intelligent voter who does 
 not study the foundation of the republic. Every citizen should 
 pursue this subject further in the pages of the Federalist, 
 which argued one side of the issue, and in the writings of 
 Thomas Jefferson, who upheld the other. It will show how 
 high ran feeling at the time, when it is pointed out that, al- 
 though the Constitution was adopted in 1787, it was ratified 
 but by eleven States in 1788. 
 
 GEORGE WASHINGTON (1789-1797) was the unan-
 
 A History of American Polities. 13 
 
 imous choice of the first electoral college, and the hero of the 
 Revolution became the first President of the United States in 
 1789. It is not to be imagined that even at that time the peo- 
 ple were all of one mind about the Constitution. There is no 
 document not even the Bible which is not subject to dif- 
 ferent interpretations, and the great charter of our American 
 liberties was no exception to the rule. Parties were distin- 
 guished as strict constructionists and loose constructionists, 
 the former the Federalists, the latter the Anti-Federalists, the 
 first believing in a strongly centralized government, the second 
 jealously observant of the rights of the States. The contest 
 between the parties was the great question which afterwards 
 shook the country from center to circumference, in the agony 
 of civil war it was the contest between "State Sovereignty" 
 and a "Xation." 
 
 Hamilton, Jay and Madison were conspicuous for their 
 support of the Federal cause, while Jefferson, John Hancock, 
 Patrick Henry, Sam Adams and George Clinton espoused the 
 cause of the Anti-Federalists, or State Rights party. Thus 
 originated the names, Hamiltonian and Jeffersonian, which 
 even to this day distinguish the difference between a strong 
 centralized government and the more democratic idea of a 
 strong local government. That the one carried to an extreme 
 leads to monarchy, there can be no more question than that 
 the other, if carried to a like extreme, would lead to weakness, 
 dissolution, and, perhaps, anarchy. How to avoid either ex- 
 treme, should be the aim and object of every patriot and 
 statesman. 
 
 Of course other issues complicated the old ones. The Anti 
 Federalists warmly urged the alliance with France. In the 
 revolution which had just ended, the French alone had first 
 come to our aid, and on land and sea had waged war upon our 
 common enemy. Hence there was a lively sense of gratitude 
 to that great nation throughout the country, made none the 
 less by the establishment of the republic. The Federalists, 
 on the other hand, inclined toward England as the natural 
 friend through, the ties of kinship and common language. 
 
 Alexander Hamilton, the head of the Federalist party, was
 
 14 A History of American Politics. 
 
 the controlling spirit in Washington's cabinet. Under his in- 
 fluence as Secretary of the Treasury a bill was passed in 1791 
 which introduced the monarchical financial system of Europe 
 by establishing a national bank, called the United States 
 Bank, modeled after the Bank of England and chartered for 
 twenty years.. 
 
 Hamilton's was the English idea hard money and a gov- 
 ernment bank, a union of church and state, and a funding 
 scheme for absorbing the national debt. The Federal party, 
 of course, supported Hamilton's views, while the Anti-Federals 
 bitterly opposed them. Hamilton and Knox championed the 
 United States Bank, while Jefferson and Randolph opposed 
 it and declared it unconstitutional. Jefferson said of it: 
 "This bank corporation will come to control the Government 
 in its own selfish interest and menace, if it does not destroy, 
 the liberties of the people." 
 
 In nearly every tendency toward monarchy can be found 
 the hand of Hamilton. However brilliant may have been his 
 genius, however great may have been, in many things, his serv- 
 ices to the young republic, the thoughtful and reflective mind 
 can only regard his influence in shaping the career of the na- 
 tion as evil and calamitous. He was an aristocrat. His heart 
 was not in sympathy with purely democratic institutions. He 
 would undoubtedly have preferred the establishment of a 
 monarchy instead of a republic. 
 
 Fortunately for the republic there lived at the same time 
 a man in every sense his equal, and in point of patriotism, 
 liberality and genuine republicanism transcendently his supe- 
 rior Thomas Jefferson, the acknowledged leader of the anti- 
 Hamiltonian or Anti-Federal party. 
 
 After the adoption of the Constitution, together with the 
 ten amendments, the name anti-Federal was dropped, and the 
 name "Democratic-Republican" adopted though the word 
 "Democratic" was usually omitted, and only the word "Re- 
 publican" used. No doubt the fact that reproach and ridicule 
 was attached to the word "Democrat" (very much as the aris- 
 tocrats of today ridicule third party men) had a good deal to 
 do with eliminating it from the party name. It was applied
 
 A History of American Politics. 15 
 
 to the Jeffersonians very much as the word "communist" and 
 "anarchist" is frequently applied in these days to Populists 
 because it was an appellation assumed by the Jacobins of 
 Prance. Therefore it may be said that the word "Democrat," 
 used as the name of a party, had its origin in this country as a 
 name of reproach. 
 
 In spite of differences of opinion, which were daily grow- 
 ing more bitter, there was practically no partisanship during 
 Washington's administration. He called Federalists and 
 Anti-Federalists into his cabinet, and his farewell address, 
 which every school-boy has read, is full of grave warning 
 against the evils and dangers of party spirit. 
 
 But with Washington in retirement, the contest began. 
 The Federalists put JOHN ADAMS (1797-1801) in the field, 
 and elected him in spite of the English treaty which John Jay 
 had made and which Adams had supported. Thomas Jefferson 
 became Vice-President, because at that time the Vice-Presi- 
 dency went to the man receiving the next largest vote for 
 President, a system which was in force until 1804. 
 
 There were many reasons why the Federalist triumph 
 could not be a permanent one. England was intensely unpopu- 
 lar, and the administration was accused of favoring that king- 
 dom unduly. The alien and sedition laws caused an access of 
 the public displeasure, and the party split into two sections, 
 one following Adams, the other Hamilton. Nominations for 
 the election were made by members of Congress; Adams and 
 Pinckney were chosen as the Federal standard-bearers, Jeffer- 
 son and Aaron Burr as the Republican. Jefferson and Burr 
 were elected, but as both had received the same number of 
 votes, the election was thrown into the House, which chose 
 THOMAS JEFFERSON (1801-1809) the third President 
 of the United States. This was a death-blow to the Federal 
 party. And so completely was it wiped out of existence by 
 Jefferson's second election that its candidate, Charles C. 
 Pinckney, received only 14 electoral votes to Jefferson's 162. 
 
 Under the guiding hand of Jefferson the republic was 
 gradually drawn away from the pernicious influences of the 
 Hamiltoniau idea, and put upon a genuine republican track.
 
 16 A History of American Politics. 
 
 Fortunate, indeed, it proved to be for the nation that so great 
 and good a patriot had the helm at that critical period of its 
 history. 
 
 The history of Jefferson's administration was a quiet one. 
 He refused to make the civil service the spoil of victory, and 
 gave proof of the flexibility of his ideas of government by the 
 purchase of Louisiana Territory from France in 1803, which 
 was a measure tending strongly toward Federalism giving a 
 hostage, as it were, to the central government on the part of 
 the States. Jefferson also agreed to the building of the great 
 post road to the Ohio, which was by no means a Republican 
 scheme. Among the important events of the administration 
 were the Burr expedition, the first threats of "secession" (this, 
 by the way, was a Federal idea, and first suggested on behalf 
 of the Northern States), the "embargo" difficulties and the 
 naturalization laws. At the end of Jefferson's second term he 
 promptly declined to be considered a candidate for a "third 
 term," thereby recognizing and putting into effect the example 
 of the illustrious Washington. 
 
 JAMES MADISON (1809-1817) was elected fourth 
 President. He, like Jefferson, was a Republican, although, as 
 has been pointed out, that party is more nearly akin to the 
 Democratic party of our own time. C. C. Pinckney, the Feder- 
 alist candidate who opposed him, and who had run twice 
 against Jefferson, received 47 electoral votes, while Madison 
 was given 122. The Federalists lost every part of the country 
 save New England, and one result of this election was to give 
 that sectional tone to our politics which has to a greater or 
 less extent endured to the present time. 
 
 In 1811 the charter of the national bank expired and there 
 was an effort made in Congress to re-charter it. Its principal 
 support was the remnant of the Hamilton "strong-government" 
 party, the Federals an interesting fact taken in connection 
 with the present attitude of parties concerning our present 
 national banking system. The scheme to re-charter, however, 
 failed to go through. 
 
 The country was drifting into a war with England at this 
 time, and the public spirit was aroused by the continual out-
 
 A History of American Politics. 17 
 
 rages perpetrated upon our sailors on the high seas by British 
 ships. The Republicans were recognized as the fighting party, 
 and under the leadership of Calhoun, Clay and Crawford the 
 War of 1812 was begun. The Federalists protested, and in 
 Massachusetts and Connecticut the Governors refused to allow 
 the militia to go out of the State, save to repel invasion. That 
 argument lasted but a short time, however, for the country 
 was invaded and the city of Washington captured and burned. 
 The treaty of peace was signed in the winter of 1814, but be- 
 fore the news reached this country Andrew Jackson had 
 gained the magnificent victory of New Orleans, on January 
 8, 1815. 
 
 In 1816 the Republican party, having been somewhat re- 
 modeled and manipulated by the banking interests, passed a 
 law establishing another United States Bank. 
 
 It was during Madison's administration also that the 
 question of a protective tariff was first discussed to any extent. 
 On both the banking and the tariff questions the two parties, 
 the Federals and Republicans, had changed places very much 
 as the two old parties of to-day have changed places on ifeany 
 questions. For instance, in 1862, the Republican party was in 
 favor of a greenback currency and the Democratic party op- 
 posed it. Afterwards Republicans proposed to destroy the 
 greenback money, and, as a matter of opposition merely, the 
 Democrats, or a portion of them, opposed it. 
 
 With the close of Madison's administration a new era in 
 our politics began. The questions of Federalism and of the 
 French or English friendship were dead, and new issues were 
 coming up. These were the tariff, the management of finances 
 and the development of industry. What became known as 
 the Era of Good Feeling followed, which lasted from the 
 election of JAMES MONROE (1817-1825) up to 1828. 
 Upon Monroe's second election, in 1824, there was no opposi- 
 tion, and he would have had the unanimous vote of the elec- 
 toral college had not one of the electors declared that that 
 honor should be confined sacredly to Washington. 
 
 It was the Slavery Question which put an end to the 
 era of good feeling, and which burned hotly, and more hotly,
 
 18 A History of American Politics. 
 
 until it wrapped the whole land in the flames of civil war. It 
 began with the application of Missouri for admission into the 
 Union in 1820. Prior to that time Mason and Dixon's 
 Xjine, which is the boundary of Maryland and Pennsylvania, 
 and the Ohio River, formed the division between slave States 
 and free. Missouri lies beyond the Mississippi River, and out 
 of the limits fixed, and the question was a threatening one 
 until Henry Clay brought in his famous Missouri Com- 
 promise, which admitted Missouri as a slave State, and for- 
 bade slavery north of 36 30 north latitude. To balance 
 Missouri in the Senate, Maine was admitted at the same time 
 as a free State. 
 
 A protective tariff had been devised by John C. Calhoun 
 in 1816, and President Monroe strengthened and increased the 
 protection accorded. In 1819 he purchased Florida from 
 Spain; and in 1823, in consequence of the war made by Spain 
 against her revolted colonies in the three Americas, be voiced 
 that splendid declaration which will always be associated with 
 his name the Monroe Doctrine. This doctrine briefly is 
 that the United States will not interfere in any European war, 
 nor will it permit European interference or European control 
 in America, North or South. 
 
 No better proof could be given of the condition of parties 
 than the election which ended Monroe's tenure of office. The 
 electoral college chose a Vice-President, John C. Calhoun, but 
 its vote for the Presidency was so scattered between Jackson, 
 Adams, Crawford and Clay that the choice was thrown into the 
 House. Here, by an alliance of the friends of Clay and Adams, 
 Jackson was defeated and JOHN QUINCY ADAMS 
 (1825-1829) became the sixth President. Clay was rewarded 
 with the portfolio of State, and out of the alliance the Whig 1 
 Party was formed. Their principles were in part those of the 
 old Federalists. They were for a high tariff with strong pro- 
 tection, and they early declared for a policy of internal im- 
 provements to be paid for by the nation at large. Jackson's 
 followers took the place of the old Anti-Federalists; they were 
 strict constructionists, opposed to the tariff, and in their prin- 
 ciples and speeches was to be found the nucleus of the States'
 
 A History of American Politics. 19 
 
 rights doctrine. They called themselves "Democrats.'' 
 The four years of Adams' presidency were passed in marshal- 
 ing and organizing the two opposing forces. 
 
 ANDREW JACKSON (1829-1837), the seventh Presi- 
 dent, carried everything before him. The electoral vote was 
 178 to 83; the popular, 647,231 for Jackson, 509,097 for 
 Adams. As soon as he had taken up the reins of power, Jack- 
 eon removed some five hundred officeholders from their places, 
 on Marcy's famous theory that "to the victors belong 
 the spoils.'* Upon this principle the tenure of political office 
 still practically, if not theoretically, depends. 
 
 The Tariff was exceedingly unpopular at the South, 
 which was then, as now, an agricultural rather than a manu- 
 facturing region. Several States had protested, and in 1830 
 Senator Hayne laid down the doctrine of Nullification 
 that any State could declare null and void any act of Congress. 
 Webster answered this declaration in the debate which has 
 since been famous. The original discussion was not on the 
 tariff regulations, but on the sale of public lands. The strug- 
 gle was a hot one. Jackson took occasion to put himself on 
 record at once with his celebrated toast, "Our Federal Union, 
 it must be preserved." The words were first uttered at a din- 
 ner in honor of his birthday. Calhoun took the opposite view, 
 and in 1831 the President's cabinet was broken up by the 
 issue. A new tariff bill was passed, but the South was still 
 dissatisfied, and in 1832 South Carolina passed the Nullifica- 
 tion ordinance. Jackson at once sent a naval force into 
 Charleston harbor, and Congress passed a bill enforcing the 
 tariff; but Henry Clay again came forward with a compromise 
 which was accepted on both sides. 
 
 The United States Bank was the next boneof conten- 
 tion. The second United States Bank had been chartered in 
 1816 for a term of twenty years. Instead of re-chartering the 
 bank in 1829, 1830, 1831 and 1832 General Jackson insisted on 
 the Government issuing its own money, making its own ex- 
 changes and keeping its own deposits. But Congress sur- 
 rendered to the money power, and in 1832 re-chartered the 
 bank. Jackson vetoed: the bill, declaring that under the Con-
 
 20 A History of American Politics, 
 
 stitution Congress had no power to authorize a bank corpora- 
 tion to issue money, but that the currency of the country 
 should consist of gold and silver coins and Treasury notes. 
 The friends of the bank tried to pass the bill over the veto, 
 but failed. The bank, however, having still four years to run, 
 Jackson ordered his Secretary of the Treasury, Duane, to re- 
 move the national deposits from the bank. Duane refusing, 
 Jackson dismissed him and appointed Taney Secretary of the 
 Treasury. The deposits ceased. The Senate at once passed a 
 vote of censure on the President, but the House sustained 
 Jackson at every point and refused a new charter. The fight 
 with the Senate, in which there was an adverse majority, con- 
 tinued until the end of Jackson's term. 
 
 Out of Jackson's opposition to the bank grew the new 
 Whig 1 Party. It was at first composed principally of Na- 
 tional Republicans, the Nullifiers, the Anti-Masons, and those 
 Democrats who were displeased with Jackson's severe meas- 
 ures concerning the removal of Treasury deposits from the 
 United States Bank. It was made up, perhaps, a good deal as 
 the People's party was made up in 1892 that is, of 
 factions and shades of nearly everything opposed to "both the 
 old parties." 
 
 In opposition to Jackson's second term there were arrayed 
 no less than three candidates Henry Clay, National Republi- 
 can; John Floyd, Nullification, and William Wirt, Anti-Ma- 
 sonic. Jackson received 219 electoral votes; Clay, 49; Floyd, 
 11, and Wirt, 7. 
 
 During Jackson's administration was the first weak be- 
 ginning of the Abolition party. The Anti-Slavery Society 
 was formed in 1833. It was the target for abuse and violence, 
 culminating in the assassination of Love joy. Congress 
 solemnly declared that it would listen to no petitions upon 
 the question of slavery, and Jackson asked that the sending of 
 abolition documents through the mails should be prohibited. 
 This the Senate refused. 
 
 The Democratic candidate, MARTIN" VAN BTJREN 
 (1837-1841), the eighth President, was elected over W. H. Harri-
 
 A History of American Politics. 21 
 
 eon and several other opposition nominees, including Daniel 
 Webster. 
 
 The Great Panic of 1837 occurred during Van 
 Buren's administration. Money became scarce everywhere 
 and failures were most frightfully numerous. Daniel Webster 
 ascribed the panic to the interference of the Government with 
 the currency, and to the celebrated "Specie Circular," which 
 demanded that public lands be paid for in specie only. On 
 May 10, 1837, all the New York banks suspended, but Prof. 
 W. G. Sumner, of Yale, states, in his "History of American 
 Currency," that "nearly all the banks made money out of the 
 suspension and paid big dividends during the year." 
 
 In 1840 Van Buren was renominated, but the Whigs, by 
 an attack on the Democratic financial policy, carried the coun- 
 try and elected W. H. HARBISON (1811) the ninth Presi- 
 dent. It was in this campaign that the Abolitionists produced 
 their first national platform, which favored the abolition of 
 slavery in the District of Columbia and the Territories. In 
 the same year the Democracy at Baltimore resolved that Con- 
 gress had no power to interfere with or control the domestic 
 institutions of the several States, which were the sole and 
 proper judges, of everything pertaining to their own affairs not 
 prohibited by the Constitution, and that the efforts "by Aboli- 
 tionists or others" to interfere with questions of slavery were 
 calculated "to lead to the most alarming and dangerous conse- 
 quences," "to diminish the happiness of the people and en- 
 danger the stability and permanence of the Union, and ought 
 not to be countenanced by any friend of our political institu- 
 tions." The convention also adopted a resolution to the effect 
 that every attempt to abridge the rights or privileges of for- 
 eign-born citizens should be resisted. This was aimed at the 
 Know-nothing tendency then just appearing, which had, how- 
 ever, no affiliation with the Abolition movement, already 
 vigorous. 
 
 Harrison did not live out the year, and he was succeeded 
 by the Vice-President, JOHX TYLER (1841-1845), the tenth 
 President. Tyler rapidly got into trouble with his cabinet, 
 which, save Webster, deserted him on issues connected with
 
 22 A History of American Politics. 
 
 his attempt to carry out Harrison's financial policy. The 
 slavery question was pressing forward more and more urgently 
 for solution all the time. An Ohio Congressman, Giddings, 
 brought the issue into the House of Representatives, and was 
 censured by that body for so doing. He resigned and was at 
 once unanimously re-elected. A new tariff bill was brought 
 in, and the proposition then made for a division of the surplus 
 among the States. 
 
 Finance, protection, internal improvements, and indeed 
 every minor issue, had to give way to the great puzzle of 
 slavery. It was coming on for adjustment, and no hand could 
 stay it. In the campaign of 1844 it produced the dispute over 
 the re-annexation of Texas. The Democratic platform de- 
 clared the Great American Measures the taking in of 
 Texas and Oregon. As Texas would be a slave territory, the 
 idea was antagonized in the North, but after a close and per- 
 plexed election JAMES K. POLK (1845-1849), the eleventh 
 President, was elected. Henry Clay, the Whig candidate, was 
 beaten by the vote of 62,300 which was given to Jas. G. Birney 
 by the Liberty party. The Democratic and Whig parties 
 were silent in their platforms concerning the vexed question 
 of slavery, because both were afraid to raise the question for 
 discussion before the people. They treated that question 
 much as the Democratic aud Eepublican parties of to-day 
 treat the finance, land and transportation questions. They 
 ignored the only living question of the day. Although the 
 gallant little band of agitators, known as the Liberty Party, 
 received but an insignificant vote, they wero sowing seed and 
 spreading light for the future. The two old parties ridiculed 
 them, but they struggled on under the motto, "Duty is ours, 
 results are God's." 
 
 The new administration at once took up the Texas matter, 
 and the War with Mexico was the necessary consequence. 
 It is here necessary merely to point out the results. By the 
 treaty of Guadalupe-Hidalgo, the United States acquired all 
 that country which we now call the great West, including the 
 treasures of California and the Sierras. The northwestern 
 frontier was fixed at the 49th degree of north latitude, and the
 
 A History of American Politics. 
 
 administration closed with the largest accession of land that 
 had yet been made to the republic. 
 
 The Wilmot Proviso attempted to block slavery in the 
 new territories, and Oregon was organized as free soil. A low 
 tariff bill was passed, and the Whigs got through a river and 
 harbor bill which the President promptly vetoed. This 
 brought the country up to the campaign of 1848. A faction 
 of the Democratic party, called the "Barnburners" or "Liber- 
 als," bolted the national convention at Baltimore, and subse- 
 quently at Utica, New York, and nominated Martin Van Buren 
 receiving the title of "Free Soil" Party, owing to the aboli- 
 tion tone of its platform. The Liberty party withdrew its 
 candidates, Joh a P. Hale and Leicester King, and supported 
 the Free Soil ticket. The Whigs nominated Zach Taylor, and 
 the Democrats Lewis Cass. As in the previous campaign, 
 both of the old parties ignored the slavery question, notwith- 
 standing the atmosphere was filled with ominous murmurs of 
 discontent and revolution. They lauded the men who had 
 taken part in the Mexican war; they reiterated the declara- 
 tions of Jefferson, and Jackson, and Washington; they hinted 
 at the tariff; they expressed sympathy with the struggling 
 masses in monarchical Europe but not one word concerning 
 the institution of slavery. 
 
 The election resulted in 163 electoral votes for ZACH- 
 ARY TAT LOB (twelfth Paesident 1849-50), 127 for Cass, 
 and none for Van Buren! The popular vote stood 1,360,101 for 
 Taylor; 1,220,544 for Cass, and 291,263 for Van Buren. 
 
 Though not an abolitionist, the fact that President Taylor 
 called into private council Mr. Seward was an evidence that 
 he had no sympathy for the further extension of slavery. If 
 not the avowed enemy of slavery, he certainly was not its 
 friend. Although in the platform and during the compaign 
 the question of slavery had been treated by both Whigs and 
 Democrats with a high-toned and disdainful indifference, it 
 was a ghost that would not down. Like the money question 
 of to-day, it needed constant "tinkering" to keep it in repair. 
 No sooner was a small leak stopped in one place than a big 
 one started in another. In short, the irresistible public senti-
 
 24: A History of American Politics. 
 
 ment of the North, that was being awakened by the songs of 
 the Hutchinsons, the newspaper articles of Garrison, the fiery 
 eloquence of Phillips, the ringing poetical effusions of Whit- 
 tier, was the upper millstone that was constantly grinding 
 upon the nether millstone, the monstrous wrong known as 
 slavery; and between the two, men, parties and political for- 
 tunes were ground to dust. It was "in the air," and sooner or 
 later it was bound to gain a momentum that would become a 
 whirlwind. 
 
 Henry Clay, an able and eloquent man, but, like all ambi- 
 tious politicians, a political coward, undertook to patch up a 
 compromise. He introduced a series of eight resolutions, 
 which provoked a debate of not less than four months. As 
 the debate extended the resolutions increased in number, so 
 that there were no less than thirty-nine of them. It became 
 known as the Omnibus Bill, and in spite of the best efforts of 
 the champions of compromise, it failed to pass. However, 
 what was called the "Compromise of 185O" was patched 
 up and passed. It provided for the organization of N ew Mex- 
 ico and Utah without reference to slavery, admitted California 
 as a free State, for the rendition of fugitive slaves, and the 
 abolition of slavery in the District of Columbia! It proved 
 but a sorry piece of patchwork, for it only made more intense 
 the internal fires that were so soon to burst forth in all their 
 volcanic fury. 
 
 Upon the death of President Taylor, the Vice-President, 
 MILIjARD FILLMORE (1850-53), had became the thir- 
 teenth President. He completely changed the policy of his 
 predecessor, and undertook to build up a new party on a 
 "compromise measure." It acquired considerable support in 
 New York under the name of "Silver Gray," but in fact "died 
 bornin' " simply from the fact that it is as impossible to build 
 a party upon "compromise or negative principles" as it is to 
 build a house upon sand. 
 
 In 1852 the American or "Know-Nothing" party 
 sprang up. It was based upon opposition to foreign-born citi. 
 zens of the United States. Whether or not it was the result 
 of an effort by the friends of slavery to get up a sort of side-
 
 A History of American Politics. 25 
 
 show to divert the attention of the public from the main ques- 
 tion is not known, but it seems so much like the present effort 
 of the money-mongers and monopolists to excite discussion 
 upon the tariff question in order to attract the attention of 
 the people from vital issues that it is altogether probable. 
 
 The campaign of 1852 is similar in many vital points to 
 those of 1880, 1884, 1888 and 1892. The Democrats nominated 
 Franklin Pierce and declared boldly for non-interference with 
 slavery in the various States, and especially avowed a deter- 
 mination to enforce the law of 1850 "reclaiming fugitive slaves." 
 The Whigs nominated Winfield Scott, "affirmed and ac- 
 quiesced" in the "compromise laws of 1850," and especially the 
 "fugitive slave law," and (in almost the identical language of 
 the Democratic platform) discountenanced and deprecated any 
 "further agitation" of the slavery question. The Free Soil 
 party nominated John P. Hale and declared, in words that 
 rang as though coming from the rocky summit of Mt. Sinai, 
 that "slavery is a sin against God, a crime against- man which 
 no human enactment or usage could make right, and that 
 Christianity, humanity and patriotism alike demand its abo- 
 lition." 
 
 The result of the contest was that FRANKLIN 
 PIERCE (1853-1857), the fourteenth President, was elected. 
 He had 254 electoral votes, Scott 42, and Hale NOT ONE! The 
 popular vote was: Pierce, 1,601,474; Scott, 1,386,578, and Hale 
 only 156,149. 
 
 At the close of that campaign we wonder if there were not 
 men who sneered at the vote cast for Hale? We wonder if 
 there were not men who declared that the party had "died 
 out"? 
 
 How similar to recent campaigns was the struggle of 1852! 
 Both of the old parties got down upon their bellies and crawled 
 in the dust at the feet of the arrogant Slave Power, just as 
 of late years both old parties have groveled at the feet of the 
 Money Power and Monopoly. 
 
 The lesson is obvious. The Whig party was killed by the 
 campaign of 1852. And history repeats itself. 
 
 Soon after the election there was actual fighting on the
 
 26 A History of American Politics. 
 
 dividing line between North and South. Growing bold with 
 apparent success, the Slave Power began an aggressive war- 
 fare upon the free soil territory. Douglas reported a bill to 
 abrogate the "Missouri Compromise" of 1850, and permit 
 the people of new States to adopt the institution or not, as 
 they saw fit. This opened the slavery question again. De- 
 bate ran high. The compromise of 1850 was repealed. It 
 seemed to be the brand which kindled the flame of the anti- 
 slavery fires. In the spring of 1854 a new party, composed of 
 all opposed to the extension of slavery, was organized in many 
 States. It was called the Republican Party. During the 
 next year, 1855, it grew rapidly in numbers. It was composed 
 of Free Soilers, Whigs, anti-slavery Democrats, anti- Nebraska 
 Democrats, anti-slavery Americans, and, in short, anti-almost- 
 everything. 
 
 Passions were at fever heat. In Kansas the "Jayhawkers" 
 and the "Border Ruffians" were already at each other's throats. 
 It was plain that the matter in dispute could only be settled 
 by an appeal to the arbitrament of arms. 
 
 In 1856 the Republicans nominated their first candidate, 
 Gen. John C. Fremont, "the Pathfinder." Their platform re- 
 cites that the convention was called without regard to previous 
 political differences, to enable all opposed to the repeal of the 
 Missouri Compromise to come together. The platform op- 
 posed the extension of slavery into the Territories; declared 
 that Congress should prohibit in the Territories "the twin 
 relics of barbarism, polygamy and slavery;" and opposed all 
 prescriptive legislation, thus antagonizing the Democracy on 
 the slavery issue and the Know-nothings on nativism. The 
 Whigs met at Baltimore. Their platform is devoted exclu- 
 sively to a denunciation of "geographical parties," and a 
 recommendation of Millard Fillmore, the American or "Know- 
 nothing" candidate for President. The Democrats added lit- 
 tle to former platforms, save that they declared against the 
 "Know-nothings" on their war on foreigners, and agreed with 
 them in their declaration against intervention with slavery. 
 They nominated and elected JAMES BUCHANAN 
 (1857-1861), fifteenth President. Fremont, however, polled a
 
 A History of American Politics. 27 
 
 popular vote of 1341,264 against Buchanan's 1,838,169, while 
 Fillmore received 874,534. 
 
 The Dred Scott Case now came on to exacerbate still 
 more bitterly public feeling. Chief Justice Taney declared 
 that a negro was a chattel, that the compromise of 1850 was 
 unconstitutional, and that a slave-owner might settle with his 
 property where he pleased, in any territory. Following this 
 came John Brown's raid into Virginia his attempt to incite a 
 slave insurrection, and his death upon the gallows. There 
 was nothing for it but war, and into war the country rapidly 
 drifted. 
 
 The campaign of 1860 was the most confused in the whole 
 history of American politics. There was talk of secession in 
 the air. There was notoriously war preparation in the South. 
 The North was divided. Every man felt that parties would 
 have to be re-arranged and new political frontiers defined. 
 The "Constitutional Union" party met at Baltimore. All it de- 
 manded was the "Constitution of the country, the union of 
 the States, and the enforcement of the laws." The Republi- 
 cans met at Chicago. Their platform denounced the threats 
 of disunion made by Democrats in Congress as an "avowal of 
 contemplated treason," which it was the duty of the people to 
 "rebuke and forever silence." It asserted that the normal 
 condition of all the Territories of the United States is that of 
 freedom; that the reopening of the slave trade was a crime 
 against humanity; that duties should be adjusted so as to en- 
 courage the development of the industrial interests of the 
 whole country; that Congress should pass a complete and 
 satisfactory homestead law; that the rights of citizenship en- 
 joyed by foreigners should not be abridged or impaired; that 
 the rights of all citizens, native or naturalized, should be pro- 
 tected abroad and at home. The Douglas Democratic plat- 
 form, adopted at Charleston, favored the acquisition of Cuba; 
 declared that State legislatures which interfered with the en- 
 forcement of the fugitive slave law were revolutionary and 
 subversive of the Constitution; and reaffirmed the Cincinnati 
 platform of 1856 on tariff. The Breckinridge platform, adopted 
 at Charleston and Baltimore, reaffirmed the Democratic plat-
 
 28 A History of American Politics. 
 
 form adopted at Cincinnati, with certain "explanatory resolu- 
 tions," which in substance were that slave-owners had a right 
 "to settle with their property" in the Territories without being 
 interfered with by Territorial or Congressional legislation. 
 
 On these issues four candidates were put in the field. 
 The Republicans nominated Abraham Lincoln; the Demo- 
 crats, J. C. Breckinridge; the Constitutional Union party, 
 John Bell; the Independent Democrats, Stephen A. Douglas. 
 ABRAHAM LINCOLN (1861-1865) was chosen sixteenth 
 President, by a popular vote of 1,866,352; Douglas received 
 1,375,157; Breckinridge, 845,763; Bell, 589,581. 
 
 On December 20, 1860, South Carolina declared that the 
 Union was dissolved, and a Secession resolution was passed. 
 Following, six other slave States immediately seceded. Every 
 effort was made to stem the tide of disunion, but nothing 
 could be done save with arms in the field. A peace congress met 
 and proved futile. The Crittenden compromis3 was scoffed out 
 of court. The Confederacy was formed at Montgomery, Ala- 
 bama, in February, 1861, with Jefferson Davis as President, 
 and slavery and low tariff as its corner-stone. The first ball 
 was fired April 14, 1861, and the great issue of the century 
 joined. 
 
 For the time politics was relegated to the background. 
 There were only Unionists and Secessionists. The financing 
 of the great struggle led to a high tariff, the issue of Treasury 
 notes, and finally the establishment of the national banking 
 system. The internal revenue system was developed, an in- 
 come tax was imposed, greenbacks were issued, and the re- 
 sources of the country marshaled to meet the expenses of a 
 war that cost a million dollars a day. 
 
 On January 1, 1863, President Lincoln issued the Eman- 
 cipation Proclamation, which freed the Southern slaves, 
 and marks an epoch in the history of the world. Two years 
 later, under the apple tree at Appomattox, Lee surrendered to 
 Grant, and the war ended with the complete triumph of the 
 Northern arms. There had in the meantime been another 
 Presidential election, in which Lincoln defeated George B. 
 McClellan. Shortly after Lee's surrender Lincoln was assas-
 
 A History of American Politics. 29 
 
 sinated by J. Wilkes Booth, an actor, and ANDREW 
 JOHNSON (1865-1869), the seventeenth President, took up 
 the chief magistracy. 
 
 The problem of the day was the Reconstruction of the 
 old slave States, upon which the new President and his party 
 at once quarreled. The point at issue was the proper safe- 
 guarding of the newly-freed negro. Congress passed the Civil 
 Rights bill, the Freedman's Bureau bill, and submitted the 
 XIV th Amendment to the Constitution. The President was 
 finally impeached by Congress, but his trial before the Senate 
 resulted in an acquittal by one vote. 
 
 ULYSSES S. GRANT (1869-1877), the eighteenth 
 President, was elected over Horatio Seymour, on a platform 
 adopted by the Republicans, at Chicago, which denounced re- 
 pudiation; favored suffrage on equal terms to all men; en- 
 couraged immigration and declared itself in sympathy with 
 all oppressed people who are struggling for their rights. The 
 Democratic platform of 1868 acknowledged that the questions 
 of slavery and secession had been forever settled by the war or 
 by constitutional conventions, and favored amnesty for all po- 
 litical offenses. It made a very distinct pronouncement on 
 tariff in the following words: "A tariff for revenue upon 
 foreign imports, and such equal taxation under the internal 
 revenue laws as will afford incidental protection to domestic 
 manufactures, and as will, without impairing the revenue, 
 impose the least burden upon, and best promote and encour- 
 age, the great industrial interests of the country." The XVth 
 Amendment, guaranteeing negro suffrage, was passed by Con- 
 gress in 1869. After the campaign of 1868 agitation of the la- 
 bor and finance questions commenced. An attempt was made 
 to run a ticket in 1872, but failed, 
 
 A Liberal Republican ticket, with Horace Greeley at its 
 head, was supported by the united opposition against Grant 
 in 1872, but was defeated easily, and Greeley, one of the 
 greatest figures in later American politics, died shortly after- 
 wards. The South was pacified, and the Treaty of "Wash- 
 ington made, which involved the payment of the Alabama 
 claims by the English government. It was during the first
 
 30 A History of American Politics. 
 
 year of Gen. Grant's second term as President (1873), that a 
 bill was passed which, while scarcely attracting attention at 
 the time, has proven of momentous consequence to the nation. 
 It bore the innocent title, "An act revising and amending the 
 laws relative to the mints, assay offices and coinage of the 
 United States." This act demonetized the silver dollar 
 by merely omitting that coin from the enumeration of the 
 coins of the United States. The President who signed the 
 bill and many of the Congressmen who voted for it did so be- 
 cause they were ignorant of its real character among them 
 Hon. W. D. Kelley, chairman of the Coinage Committee. Gar- 
 field, Blaine, Voorhees and Conkling afterwards asserted that 
 they did not know that the bill demonetized silver. No party 
 lines were drawn in the vote on the bill. John Sherman in- 
 troduced and engineered it. His name will stand as the 
 synonym for infamy when the American people understand 
 the nature of his act. The greatP aiiic of 1 87 3 was caused by 
 the gradual contraction of the currency which culminated in 
 the Sherman crime and the curtailment of bank credits. 
 
 In 1876 occurred the great Hayes-Tilden Contro- 
 versy, which tested the flexibility of our electoral machinery 
 so severely. Tilden was the Democratic nominee, and he had 
 an undoubted popular majority 4,284,885, against 4,033,950 
 for Hayes. Rival electors claimed to have been elected in 
 Louisiana and Florida. Intimidation, fraud and illegal vot- 
 ing were charged, and Congress finally appointed the Elec- 
 toral Commission to settle the dispute, as there was noth- 
 ing in the Constitution to cover the circumstances. On a 
 party vote the commission awarded the disputed electoral 
 votes to the Eepublican candidate, thus making RUTHER- 
 FORD B. HAYES (1877-1881) nineteenth President of the 
 United States. Curiously enough, Democratic Governors 
 were declared elected in the States whose vote was in question. 
 
 The Greenback Party, which first formally organized 
 in Far well Hall, Chicago, Dec. 1, 1875, nominated Peter Cooper 
 for the Presidency in 1876. He polled 81,740 votes. 
 
 The railroad riots of 1877 were the most notable fea- 
 ture of the history of Hayes' period of administration. The
 
 A History of American Politics. 31 
 
 silver coinage act (Bland bill) was passed over jHayes' veto in 
 
 1878. It made the silver dollar full legal tender and provided 
 for the coinage of not less than two millions nor more than 
 four millions per month. Specie payment was resumed in 
 
 1879, the act for that purpose having been passed by Congress 
 in 1875. 
 
 In the presidential campaign of 1880 the tariff was made 
 the leading issue between the Republican and Democratic 
 parties. The Republican candidate, JAMES A. GAR- 
 FIELD (1881), was elected twentieth President over Win- 
 field Scott Hancock, Democrat, and James B. Weaver, of Iowa, 
 Greenbacker. Garfield was assasinated by a madman, Charles 
 J. Guiteau, and CHESTER A. ARTHUR (1881-1885) be- 
 came the twenty-first President. The Pendleton civil service 
 reform bill passed during his administration. The general 
 strike of telegraph operators in 1883 was the most notable 
 event of this period. 
 
 In 1884 GROVER CLEVELAND (1885-1889), the 
 first Democrat chosen since the war, was elected twenty-second 
 President. The Republican candidate was James G. Elaine, 
 while the Greenback standard was borne by Gen. Benjamin F. 
 Butler, and J. P. St. John was the candidate of the Prohibition 
 party. The year 1886 was notable for labor agitations, and 
 the Anarchist trial at Chicago attracted the attention of the 
 whole civilized world. The Democratic platform of 1888 was 
 the result of Cleveland's famous tariff reform message and 
 made the tariff practically the only issue between the two 
 great parties. Cleveland was renominated to represent the 
 Democratic idea of tariff revision, and Benjamin W. Harrison 
 represented the Republican party and protection. Fisk was 
 the candidate of the Prohibitionists and A. W. Streeter was 
 nominated by the Union Labor Party, which practically 
 took the place of the Greenback party. The result was 
 the election of BENJAMIN W. HARRISON (1889-1893), 
 twenty-third President, he receiving a majority of the electoral 
 vote, although Cleveland's popular vote was slightly larger. 
 The election also changed the complexion of Congress, enab-
 
 32 A History of American Politics. 
 
 ling the Republicans to pass what is known as the McKinley 
 tariff bill. 
 
 In 1892 the Republicans and Democrats, still divided only 
 on the question of tariff, put up the same candidates who had 
 contended for the Presidency in 1888, Harrison and Cleveland, 
 both contesting for a second term. Bidwell was the Prohibi- 
 tionist candidate and Wing represented the Socialist Labor 
 party. The great political event of 1892 was the appearance of 
 the People's Party, composed of all the various reform ele- 
 ments except extreme radicals. Its first convention was held 
 at Omaha and nominated Gen. James B. Weaver, of Iowa, for 
 President. Its platform ignored the tariff question entirely, 
 but came out strong for reform on three vital issues money, 
 land and transportation. The People's party polled over a 
 million votes, 8.67 per cent of the entire vote cast. While 
 Cleveland's election was not unexpected, the fact that many 
 States hitherto considered unalterably Republican returned 
 Democratic electors surprised the politicians. The Democrats 
 came into power in 1893 in full control of both houses of Con- 
 gress and immediately began to tinker with the tariff, finally 
 evolving a new schedule out of what was originally known as 
 the Wilson bill. The delay of both houses and particularly 
 the action of the Senate on the bill gave rise to much scandal, 
 and charges of corruption were openly made in the newspapers 
 of all political parties. The measure as finally passed was un- 
 satisfactory even to President Cleveland, who neither ap- 
 proved nor vetoed the bill, but allowed it to become a law 
 without his signature. 
 
 The money panic of 1893 and the continued and in- 
 creasing business depression which followed did not turn Con- 
 gress from its tariff folly, and no measures for real economic or 
 financial reform were entertained. The novel feature of the 
 history of 1894 was what is known as the Coxey Commonweal 
 movement the organized march of armies of unemployed to- 
 ward the capital to demand legislation for relief. 
 
 The great coal strike of 1894 began in April and was pro- 
 longed till June, ending of course in the failure of the strikers. 
 The famous Pullman boycott, inaugurated immediately after
 
 A History of American Politics. 33 
 
 the termination of the coal troubles, culminated in the great 
 railroad strike led by Eugene V. Debs, president of the Amer- 
 ican Railway Union. The storm-center was Chicago. It 
 added only another proof that the ballot is the only effective 
 weapon for the redress of labor's grievances, and that strikes 
 and boycotts only weaken the cause of labor. President Cleve- 
 land's action in sending Federal troops into Chicago in spite 
 of the protest of Governor Altgeld, and in violation of the Con- 
 stitution, is final proof that, so far as essential principles are 
 concerned, the Democratic party has drifted away from its tra- 
 ditions, and that the Tory principles of early days prevail in 
 both the old parties. The conviction of Debs and his asso- 
 ciates for contempt of court and the denial to them of the right 
 of trial by jury were the culmination of Federal usurpation of 
 power. 
 
 In the fall election of 1894 the Republicans were success- 
 ful, wiping out the Democratic majority in Congress. The 
 People's party showed a remarkable increase in strength. 
 While the total vote of all parties was nearly a million less 
 than that of 1892, the Populists showed a gain of 45 per cent. 
 
 The recent action of Congress or rather inaction on the 
 money question, and Cleveland's unauthorized issue of interest- 
 bearing gold bonds, will be taken up fully in other departments 
 of this book. 
 
 " THIS land o' ourn, I tell ye, 's got to be 
 A better country than man ever see; 
 I feel my sperit swellin' with a cry 
 That seems to say, 'Break forth and prophesy!' 
 O strange New World, that yet wast never young-, 
 Whose youth from thee by gripin' want was wrung 1 , 
 Brown foundlin' o' the woods, whose baby bed 
 Was prowled 'round by the Injun's cracklin' tread, 
 An' who grew'st strong thro' shifts an' wants an' pains, 
 Nursed by stern men with empires in their brains." 
 
 James Russell Lowell, 
 
 "A WIDOW goes out into the fields to gather nettles for her 
 children's dinner. My lord in the Bull's-eye tavern takes 
 every third nettle and calls it rent." Carlyle.
 
 " Give me liberty or give me death. 
 
 PATRICK HENRY. 
 
 THE STEPS IN THE GROWTH OF AMERICAN LIBERTY. 
 
 ^ 
 Magna Charta. 
 
 Tif EARLY seven hundred years ago was organized a movement 
 *^" which resulted in the great charter of English liberty a 
 movement which foreshadowed the battle of our American fore- 
 fathers for political independence. On the 25th of August, 
 1213, the prelates and Barons, tiring of the tyranny and vacil- 
 lation of King John, formed a council and passed measures to 
 secure their rights. After two years of contest, with many 
 vicissitudes, the Barons entered London and the King fled into 
 Hampshire. By agreement both parties met at Runnymede 
 on the 9th of June, 1215, and after several days' debate, on 
 June 15, Magna Charta (the Great Charter), the glory of Eng- 
 land, was signed and sealed by the sovereign. The Magna 
 Charta is a comprehensive bill of rights, and, though crude in 
 form, and with many clauses of merely local value, its spirit 
 still lives and will live. Clear and prominent we find the 
 motto, "No tax without representation." The original docu- 
 ment is in Latin and contains sixty -one articles, of which the 
 39th and 40th, embodying the very marrow of our own State 
 constitutions, are here given as translated in the English 
 statutes: 
 
 "39. No freeman shall be taken or imprisoned or be 
 disseised of his freehold, or liberties or free customs, or be 
 otherwise destroped [damaged], nor will we press upon him 
 nor seize upon him [condemn him] but by lawful judgment of 
 his peers or by the law of the land. 
 
 "40. We will sell to no man, we will not deny or defer to 
 any man, either right or justice." 
 
 The Great Charter recognizes a popular tribunal as a 
 check on the official judges and may be looked upon as the 
 foundation of the writ of Habeas Corpus. It provides that no 
 one is to be condemned on rumor or suspicion, but only on the 
 evidence of witnesses. It affords protection against excessive 
 emercetnents, illegal distresses and various processes for debts 
 
 34
 
 Steps in the Grcnvth of American Liberty 35 
 
 and services due to the crown. Pines are in all cases to be 
 proportionate to the magnitude of the offense, and even 
 the villein or rustic is not to be deprived of his necessary chat- 
 tels. There are provisions regarding the forfeiture of land for 
 felony. The testamentary power of the subject is recognized 
 over part of his personal estate, and the rest to be divided be- 
 tween his widow and children. The independence of the 
 church is also provided for. These are the most important 
 features of the Great Charter, which, exacted by men with 
 arms in their hands from a resisting king, occupies so conspic- 
 uous a place in history, which establishes the supremacy of 
 the law of England over the will of the monarch, and which 
 still forms the basis of English liberties. 
 
 The Mecklenburg Declaration. 
 
 TVl ORE than a year before the signing of the Declaration of 
 {.** Independence a document was drawn up that was almost 
 a model in phraseology and sentiment of the great charter of 
 American freedom. There are various accounts of this matter, 
 but the most trustworthy is this: 
 
 At a public meeting of the residents of Mecklenburg 
 County, North Carolina, held at Charlotte on the 20th of May, 
 1775, it was 
 
 "Resolved, That whenever directly or indirectly abetted, 
 or in any way, form or manner countenanced, the unchartered 
 and dangerous invasion of our rights, as claimed by Great 
 Britain, is an enemy to our country to America and to the 
 inherent and inalienable rights of man. 
 
 "Resolved, That we, the citizens of Mecklenburg County, 
 do hereby dissolve the political bonds which have connected 
 us to the mother country, and hereby absolve ourselves from 
 all allegiance to the British crown, and abjure all political con- 
 nection, contract or association with that nation, which has 
 wantonly trampled on our rights and liberties, and inhumanly 
 shed the blood of American patriots at Lexington. 
 
 "Resolv d, That we do hereby declare ourselves a free and 
 independent people: are and of right ought to be a sovereign 
 and self-governing association, under the control of no power 
 other than that of our God and the general government of the 
 Congress. To the maintenance of which independence we
 
 86 Steps in the Growth of American Liberty. 
 
 solemnly pledge to each other our mutual co-operation, our 
 lives, our fortunes, and our sacred honor." 
 
 There are two other resolutions, concerning the militia 
 and the administration of the law, but these, having no present 
 value, are here omitted. 
 
 ^ 
 
 The Declaration of Independence. 
 In Congress, July 4, 1776. 
 
 luif HEN, in the course of human events, it becomes necessary 
 ** for one people to dissolve the political bonds which have 
 connected them with another, and to assume, among the pow- 
 ers of the earth, the separate and equal station to which the 
 laws of Nature and Nature's God entitle them, a decent re- 
 spect to the opinions of mankind requires that they should 
 declare the causes which impel them to the separation. 
 
 We hold these truths to be self-evident: that all men are 
 created equal; that they are endowed by their Creator with 
 certain inalienable rights ; that among these are life, liberty, 
 and the pursuit of happiness. That to secure these rights, 
 governments are instituted among men, deriving their just 
 powers from the consent of the governed; that whenever any 
 form of government becomes destructive of these ends, it is the 
 right of the people to alter or to abolish it, and to institute a 
 new government, laying its foundation on such principles, and 
 organizing its powers in such form as to them shall seem most 
 likely to effect their safety and happiness. Prudence, 
 indeed, will dictate that governments long established should 
 not be changed for light and transient causes; and accordingly 
 all experience has shown that mankind are more disposed to 
 suffer* while evils are sufferable, than to right themselves by 
 abolishing the forms to which they are accustomed. But 
 when a long train of abuses and usurpations, pursuing invari- 
 ably the same object, evinces a design to reduce them under 
 absolute despotism, it is their right, it is their duty, to throw 
 off*such government, and to provide new guards for their fu- 
 ture security. Such has been the patient sufferance of these 
 colonies, and such is now the necessity which constrains them 
 to alter their former systems of government. The history of 
 the present King of Great Britain is a history of repeated in- 
 juries and usurpations, all having in direct object the estab- 
 lishment of an absolute tyranny over these States. To prove 
 this, let facts be submitted to a candid world. 
 
 He has refused his assent to laws the most wholesome and 
 necessary for the public good.
 
 Steps in the Growth of American Liberty. 37 
 
 He has forbidden his governors to pass laws of immediate 
 and pressing importance, unless suspended in their operation 
 till his assent should be obtained ; and when so suspended, he 
 has utterly neglected to attend to them. 
 
 He has refused to pass other laws for the accommodation 
 of large districts of people,unless those people would relinquish 
 the right of representation in the legislature a right ines- 
 timable to them, formidable to tyrants only. 
 
 He has called together legislative bodies at places unusual, 
 uncomfortable, and distant from the depository of their public 
 records, for the sole purpose of fatiguing them into compliance 
 with his measures. 
 
 He has dissolved representative houses repeatedly, for op- 
 posing with manly firmness his invasions on the rights of the 
 people. 
 
 He has refused, for a long time after such dissolutions, to 
 cause others to be elected; whereby the legislative powers, in- 
 capable of annihilation, have returned to the people at large, 
 for their exercise, the state remaining, in the meantime, ex- 
 posed to all the dangers of invasion from without, and convul- 
 sions within. 
 
 He has endeavored to prevent the population of these 
 States; for that purpose obstructing the laws for naturalization 
 of foreigners, refusing to pass others to encourage their migra- 
 tion hither, and raising conditions of new appropriation of 
 lands. 
 
 He has obstructed the administration of justice, by refus- 
 ing his assent to laws establishing judiciary powers. 
 
 He has made judges dependent on bis will alone for the 
 tenure of their offices and the amount and payment of their 
 salaries. 
 
 He has erected a multitude of new offices, and sent hither 
 swarms of officers, to harass our people, and to eat out their 
 substance. 
 
 He has kept among us, in times of peace, standing armies, 
 without the consent of our legislatures. 
 
 He has affected to render the military independent of, and 
 superior to, the civil power. 
 
 He has combined with others to subject us to a jurisdic- 
 tion foreign to our constitution, and unacknowledged by our 
 laws; giving his assent to their acts of pretended legislation: 
 
 For quartering large bodies of armed troops among us. 
 
 For protecting them, by mock trial, from punishment for 
 any murders which they should commit on the inhabitants of 
 these States. 
 
 For cutting off our trade with all parts of the world. 
 
 For imposing taxes on us without our consent.
 
 38 Steps in the Growth of American Liberty. 
 
 For depriving us, in many cases, of the benefits of trial by 
 jury. 
 
 For transporting us beyond the seas to be tried for pre- 
 tended offenses. 
 
 For abolishing the free system of English laws in a neigh- 
 boring province, establishing therein an arbitrary government, 
 and enlarging its boundaries, so as to render it at once an ex- 
 ample and fit instrument for introducing the same absolute 
 rule into these colonies. 
 
 For taking away our charters, abolishing our most valu- 
 able laws, and altering, fundamentally, the forms of our gov- 
 ernments. 
 
 For suspending our own legislatures and declaring them- 
 selves invested with power to legislate for us in all cases what- 
 soever. 
 
 He has abdicated government here, by declaring us out of 
 his protection, and waging war against us. 
 
 He has plundered our seas, ravaged our coasts, burnt our 
 towns, and destroyed the lives of our people. 
 
 He is, at this time, transporting large armies of foreign 
 mercenaries, to complete the works of death, desolation and 
 tyranny, already begun with circumstances of cruelty and per- 
 fidy scarcely paralleled in the most barbarous ages, and totally 
 unworthy the head of a civilized nation. 
 
 He has constrained our fellow-citizens, taken captive on 
 the high seas, to bear arms against their country, to become 
 the executioners of their friends and brethren, or to fall them- 
 selves by their hands. 
 
 He has excited domestic insurrection among us, and has 
 endeavored to bring on the inhabitants of our frontiers the 
 merciless Indian savages, whose known rule of warfare is an 
 undistinguished destruction of all ages, sexes and conditions. 
 
 In every stage of these oppressions we have petitioned 
 for redress in the most humble terms; our repeated petitions 
 have been answered only by repeated injury. A prince whose 
 character is thus marked by every act which may define a 
 tyrant is unfit to be the ruler of a free people. 
 
 Nor have we been wanting in attention to our British 
 brethren. We have warned them, from time to time, of at- 
 tempts by their legislature to extend an unwarrantable juris- 
 diction over us. We have reminded them of the circum- 
 stances of our emigration and settlement here. We have ap- 
 pealed to their native justice and magnanimity; and we have 
 conjured them, by the ties of our comtuon kindred, to disavow 
 these usurpations, which would inevitably interrupt our con- 
 nection and correspondence. They, too, have been deaf to the 
 voice of justice and of consanguinity. We must, therefore, ac-
 
 Steps in the Growth of American Liberty. 39 
 
 quiesce in the necessity which denounces our separation, and 
 hold them, as we hold the rest of mankind, enemies in war, in 
 peace friends. 
 
 We, therefore, the representatives of the United States of 
 A merica, in general Congress assembled, appealing to the su- 
 preme Judge of the world for the rectitude of our intentions, 
 do, in the name and by the authority of the good people of 
 these colonies, solemnly publish and declare that these United 
 Colonies are, and of right ought to be, free and independent 
 States; that they are absolved from all allegiance to the 
 British crown, and that all political connection between them 
 and the state of Great Britain is, and ought to be, totally dis- 
 solved; and that, as free and independent States, they have 
 full power to levy war, conclude peace, contract alliances, es- 
 tablish commerce and to do all other acts and things which 
 independent States may of right do. And for the support of 
 this declaration, with a firm reliance on the Protection of Di- 
 vine Providence, we mutually pledge to each other our lives, 
 our fortunes and our sacred honor. 
 
 The foregoing declaration was, by order of the Congress, 
 engrossed, and signed by the following members: 
 
 JOHN HANCOCK. 
 
 New Hampshire Josiah Bartlett, William Whipple, Mat- 
 thew Thornton. 
 
 Massachusetts Bay Samuel Adams, John Adams, Robert 
 Treat Paine, Elbridge Gerry. 
 
 Rhode Island Stephen Hopkins, William Ellery. 
 
 Connecticut Roger Sherman, Samuel Huntington, Wil- 
 liam Williams, Oliver Wolcott. 
 
 New York William Floyd, Philip Livingston, Francis 
 Lewis, Lewis Morris. 
 
 New Jersey Richard Stockton, John Witherspoon, Fran- 
 cis Hopkinson, John Hart, Abraham Clark. 
 
 Pennsylvania Robert Morris, Benjamin Rush, Benjamin 
 Franklin, John Morton, George Clymer, James Smith, George 
 Taylor, James Wilson, George Ross. 
 
 Delaware Caesar Rodney, George Read, Thomas McKean. 
 
 Maryland Samuel Chase, William Paco, Thomas Stone, 
 Charles Carroll of Carroll ton. 
 
 Virginia George Wythe, Richard Henry Lee, Thomas 
 Jefferson, Benjamin Harrison, Thomas Nelson, Jr., Francis 
 Lightfoot Lee, Carter Braxton. 
 
 -North Carolina William Hooper, Joseph Hewes, John 
 Penn.
 
 40 Steps in the Growth of American Liberty. 
 
 South Carolina Edward Rutledge, Thomas Heyward, Jr. 
 Thomas Lynch, Jr., Arthur Middleton. 
 
 Georgia Button Gwinnett, Lyman Hall, George Walton. 
 
 The following clause formed part of the original Declara- 
 tion of Independence as signed, but was finally left out of the 
 printed copies "out of respect to South Carolina'': 
 
 "He [King George III.] has waged cruel war against hu- 
 man nature itself, violating its most sacred rights of life and 
 liberty in the persons of a distant people who never offended 
 him, captivating and carrying them into slavery in another 
 hemisphere or to incur miserable death in their transportation 
 thither. This piratical warfare, the opprobrium of infidel 
 powers, is the warfare of the Christian King of Great Britain. 
 Determined to keep a market where men should be bought 
 and sold, he has at length prostituted his negative for sup- 
 pressing any legislative attempt to prohibit and restrain this 
 execrable commerce." 
 
 Jefferson's Political Policy. 
 
 1. Legal equality of all human beings. 2. The people the 
 only source of power. 3. No hereditary offices, nor order 
 of "nobility," nor title. 4. No unnecessary taxation. 5. No 
 national banks or bonds. 6. No costly splendor of adminis- 
 tration. 7. Freedom of thought and discussion. 8. Civil 
 authority superior to the military. 9. No favored classes; 
 no special privileges; no monopolies. 10. Free and fair 
 elections; universal suffrage. 11. No public money spent 
 without warrant of law. 12. No mysteries in government 
 hidden from the public eye. 13. Representatives bound by 
 the instructions of their constituents. 14. The Constitution 
 of the United States a special grant of powers limited and 
 definite. 15. Freedom, sovereignty and independence of 
 the respective States. 16. Absolute severance of Church 
 and State. 17. The Union a compact not a consolidation 
 nor a centralization. 18. Moderate salaries, economy and 
 strict accountability. 19. Gold and silver currency sup- 
 plemented by treasury notes bearing no interest and bot- 
 tomed on taxes. 20. No State banks of issue. 21. No ex- 
 pensive navy or diplomatic establishment. 22. A progress- 
 ive or graduated tax laid upon wealth. 23. No internal 
 revenue system. A complete separation of public moneys 
 from bank funds.
 
 V "70 secure the blessings of liberty to ourselves and our posterity ." 
 
 THE CONSTITUTION OF THE UNITED STATES. 
 
 PREAMBLE. 
 
 \A? E, the people of the United States, in order to form a more 
 ** perfect union, establish justice, insure domestic tran- 
 quillity, provide for the common defense, promote the general 
 welfare, and secure the blessings of liberty to ourselves and 
 our posterity, do ordain and establish this Constitution for the 
 United States of America. 
 
 ARTICLE I. 
 
 SECTION I. 1. All legislative powers herein granted shall 
 be vested in a Congress of the United States, which shall con- 
 sist of a Senate and House of Representatives. 
 
 SECTION II. 1. The House of Representatives shall be 
 composed of members chosen every second year by the people 
 of the several States; and the electors in each State shall have 
 the qualifications requisite for electors of the most numerous 
 branch of the State legislature. 
 
 2. No person shall be a representative who shall not have 
 attained to the age of twenty-five years, and been seven years 
 a citizen of the United States, and who shall not, when elected, 
 be an inhabitant of that State in which he shall be chosen. 
 
 3. Representative and direct taxes shall be apportioned 
 among the several States which may be included within this 
 Union, according to their respective numbers, which shall be 
 determined by adding to the whole number of free persons, 
 including those bound to service for a term of years, and ex- 
 cluding Indians not taxed, three-fifths of all other persons. 
 The actual enumeration shall be made within three years 
 after the first meeting of the Congress of the United States, 
 and within every subsequent term of ten years, in such man- 
 ner as they shall by law direct. The number of representa- 
 tives shall not exceed one for every thirty thousand, but each 
 State shall have at least one representative; and until such 
 enumeration shall be made, the State of New Hampshire shall 
 be entitled to choose three; Massachusetts, eight; Rhode 
 Island and Providence Plantations, one; Connecticut, five; New 
 York, six; New Jersey, four; Pennsylvania, eight; Delaware, one; 
 Maryland, six; Virginia, ten; North Carolina, five; South Caro- 
 lina, five, and Georgia, three. 
 
 4. When vacancies happen in the representation from any 
 State, the executive authority thereof shall issue writs of elec- 
 tion to fill such vacancies. 
 
 41
 
 42 The Constitution of the United States. 
 
 5. The House of Representatives shall choose their 
 speaker and other officers; and shall have the sole power of 
 impeachment. 
 
 SECTION III. 1. The Senate of the United States shall 
 be composed of two senators from each State, chosen by the 
 legislature thereof, for six years; and each senator shall have 
 one vote. 
 
 2. Immediately after they shall be assembled in conse- 
 quence of the first election, they shall be divided as equally as 
 may be into three classes. The seats of the senators of the 
 first class shall be vacated at the expiration of the second year, 
 of the second class at the expiration of the fourth year, and of 
 the third class at the expiration of the sixth year, so that one- 
 third may be chosen every second year; and if vacancies happen 
 by resignation, or otherwise, during the recess of the legisla- 
 ture of any State, the executive thereof may make temporary 
 appointments until the next meeting of the legislature, which 
 shall then fill such vacancies. 
 
 3. No person shall be a senator who shall not have at- 
 tained to the age of thirty years, and been nine years a citizen 
 of the United States, and who shall not, when elected, be an 
 inhabitant of that State for which he shall be chosen. 
 
 4. The Vice -President of the United States shall be pres- 
 ident of the Senate, but shall have no vote unless they be 
 equally divided. 
 
 5. The Senate shall choose their other officers, and also 
 a president pro tempore, in the absence of the Vice-President, 
 or when he shall exercise the office of President of the United 
 States. 
 
 6. The Senate shall have the sole power to try all im- 
 peachments. When sitting for that purpose they shall be on 
 path or affirmation. When the President of the United States 
 is tried, the Chief Justice shall preside; and no person shall be 
 convicted without the concurrence of two-thirds of the mem- 
 bers present. 
 
 7. Judgment, in cases of impeachment, shall not extend 
 further than to removal from office, disqualification to hold 
 and enjoy any office of honor, trust or profit under the United 
 States; but the party convicted shall nevertheless be liable and 
 subject to indictment, trial, judgment and punishment, ac- 
 cording to law. 
 
 SECTION IV. 1. The times, places and manner of holding 
 elections for senators and representatives shall be prescribed 
 in each State by the legislature thereof; but the Congress may 
 at any time by law make or alter such regulations, except as 
 to the places of choosing senators. 
 
 2. The Congress shall assemble at least once in every
 
 The Constitution of the United States. 43 
 
 year; and such meeting shall be on the first Monday in Decem- 
 ber, unless they shall by law appoint a different day. 
 
 SECTION V. 1. Each house shall be the judge of the elec- 
 tion, returns and qualifications of its own members, and a ma- 
 jority of each shall constitute a quorum to do business; but a 
 smaller number may adjourn from day to day and may be au- 
 thorized to compel the attendance of absent members, in such 
 manner and under such penalties as each house may provide. 
 
 2. Each house may determine the rules of its proceed- 
 ings, punish its members for disorderly behavior, and, with 
 the concurrence of two-thirds, expel a member. 
 
 5. Each house shall keep a journal of its proceedings, and 
 from time to time publish the same, excepting such parts* as 
 in their judgment require secrecy; and the yeas and nays of 
 the members of either house on any question shall, at the de- 
 sire of one-fifth of those present, be entered on the journal. 
 
 4. Neither house, during the session of Congress, shall, 
 without the consent of the other, adjourn for more than three 
 days, nor to any other place than that in which the two houses 
 shall be sitting. 
 
 SECTION VI. 1. The senators and representatives shall 
 receive a compensation for their services, to be ascertained by 
 law, and paid out of the treasury of the United States. They 
 shall, in all cases, except treason, felony, and breach of peace, 
 be privileged from arrest during their attendance at the ses- 
 sion of their respective houses, and in going to and returning 
 from the same; and for any speech or debate in either house 
 they shall not be questioned in any other place. 
 
 2. No senator or representative shall, during the time for 
 which he \vas elected, be appointed to any civil office under 
 the authority of the United States, which shall have been 
 created, or the emoluments whereof shall have been increased, 
 during such time; and no person holding any office under the 
 United States shall be a member of either house during his 
 continuance in office. 
 
 SECTION VII. 1. All bills for raising revenue shall origin- 
 ate in the House of Representatives; but the Senate may 
 propose or concur with amendments as on other bills. 
 
 2. Every bill which shall have passed the House of Rep- 
 resentatives and the Senate, shall, before it become a law, be 
 presented to the President of the United States; if he approve 
 he shall sign it, but if not he shall return it with his objections, 
 to that house in which it shall have originated, who shall en- 
 ter the objections at large on their journal, and proceed to re- 
 consider it. If after such reconsideration two-thirds of that 
 house shall agree to pass the bill, it shall be sent, together with 
 the objections, to the other house, by which it shall likewise, be
 
 44: The Constitution of the United States. 
 
 reconsidered and if approved by two-thirds of that house,it shall 
 become a law. But in all such cases the votes of both houses 
 shall be determined by yeas and nays, and the names of the 
 persons voting for and against the bill shall be entered on the 
 journal of each house respectively. If any bill shall not be 
 returned by the President within ten days (Sundays excepted) 
 after it shall have been presented to him, the same shall be a 
 law in like manner as if he had signed it, unless the Congress, 
 by their adjournment, prevent its return, in which case it 
 shall not be a law. 
 
 3. Every order, resolution or vote to which the concur- 
 rence of the Senate and the House of Representatives may be 
 necessary (except on a question of adjournment) shall be pre- 
 sented to the President of the United States; and before the 
 same shall take effect, shall be approved by him, or, being dis- 
 approved by him, shall be repassed by two-thirds of the Senate 
 and House of Representatives, according to the rules and lim- 
 itations prescribed in the case of a bill. 
 
 SECTION VIII. The Congress shall have power 
 
 1. To lay and collect taxes, duties, imposts and excises, 
 to pay the debts and provide for the common defense and gen- 
 eral welfare of the United States; but all duties, imposts and 
 excises shall be uniform throughout the United States; 
 
 2. To borrow money on the credit of the United States; 
 
 3. To regulate commerce with foreign nations, and among 
 the several States, and with the Indian tribes; 
 
 4. To establish a uniform rule of naturalization, and uni- 
 form laws on the subject of bankruptcies throughout the 
 United States; 
 
 5. To coin money, regulate the value thereof, and of for- 
 eign coin, and fix the standard of weights and measures; 
 
 6. To provide for the punishment of counterfeiting the 
 securities and current coin of the United States; 
 
 7. To establish post-offices and post-roads; 
 
 8. To promote the progress of science and useful arts, by 
 securing for limited times to authors and inventors the exclu- 
 sive right to their respective writings and discoveries; 
 
 9. To constitute tribunals inferior to the Supreme Court; 
 
 10. To define and punish piracies and felonies committed 
 on the high seas, and offenses against the law of nations; 
 
 11. To declare war, grant letters of marque and reprisal, 
 and make rules concerning captures on land and water; 
 
 12. To raise and support armies, but no appropriation of 
 money to that use shall be for a longer term than two years; 
 
 13. To provide and maintain a navy; 
 
 14. To make rules for the government and regulation of 
 the land and naval forces;
 
 The Constitution of the United States. 45 
 
 15. To provide for calling forth the militia to execute the 
 laws of the Union, suppress insurrections and repel invasions; 
 
 16. To provide for organizing, arming and disciplining the 
 militia, and for governing such part of them as may be em- 
 ployed in the service of the United States, reserving to the 
 States, respectively, the appointment of the officers, and the 
 authority of training the militia according to the discipline 
 prescribed by Congress; 
 
 17. To exercise exclusive legislation, in all cases whatso- 
 ever, over such district (not exceeding ten miles square) as may, 
 by cession of particular States, and the acceptance of Con- 
 gress, become tho seat of the government of the United States, 
 and to exercise like authority over all places purchased by the 
 consent of the legislature of the State in which the same shall 
 be, for the erection of forts, magazines, arsenals, dock-yards, 
 and other needful buildings; 
 
 And to make all laws which shall be necessary and proper 
 for carrying into execution the foregoing powers, and all other 
 powers vested by this Constitution in the Government of the 
 United States, or in any department or officer thereof. 
 
 SECTION IX. 1. The migration or importation of such per- 
 sons as any of the States now existing shall think proper to 
 admit shall not be prohibited by the Congress prior to the 
 year one thousand eight hundred and eight, but a tax or duty 
 may be imposed on such importation, not exceeding ten dollars 
 for each person. 
 
 2. The privilege of the writ of Habeas Corpus shall not 
 be suspended, unless when, in cases of rebellion or invasion, 
 the public safety may require it. 
 
 3. No bill of attainder or ex post facto law shall be 
 passed. 
 
 4. No capitation or other direct tax shall be laid, unless 
 in proportion to the census or enumeration hereinbefore di- 
 rected to be taken. 
 
 5. No tax or duty shall be laid on articles exported from 
 any State. 
 
 6. No preference shall be given by any regulation of com- 
 merce or revenue to the ports of one State over those of 
 another; nor shall vessels bound to or from one State be 
 obliged to enter, clear, or pay duties in another. 
 
 7. No money shall be drawn from the treasury but in 
 consequence of appropriations made by law; and a regular 
 statement and account of the receipts and expenditures of all 
 public moneys shall be published from time to time. 
 
 8. No title of nobility shall be granted by the United 
 States; and no person holding any office of profit or trust 
 under them shall, without the consent of the Congress, accept
 
 46 The Constitution of the United States. 
 
 of any present, emolument, office or title of any kind what- 
 ever, from any king, prince or foreign state. 
 
 Section X. 1. ISo State shall enter into any treaty, alli- 
 ance, or confederation; grant letters of marque and reprisal; 
 coin money; emit bills of credit; make anything but gold and 
 silver coin a tender in payment of debts; pass any bill of at- 
 tainder, ex post facto law, or law impairing the obligation of 
 contracts, or grant any title of nobility. 
 
 2. No State shall, without the consent of the Congress, 
 lay any impost or duties on imports or exports, except what 
 may be absolutely necessary for executing its inspection laws; 
 and the net produce of all duties and imposts laid by any 
 State on imports or exports shall be for the use of the treas- 
 ury of the United States; and all such laws shall be subject to 
 the revision and control of the Congress. No State shall, 
 without the consent of the Congress, lay any duty of tonnage, 
 keep troops or ships of war in time of peace, enter into any 
 agreement or compact with another State, or with a foreign 
 power, or engage in war, unless actually invaded, or in such 
 imminent danger as will not admit of delay. 
 
 ARTICLE II. 
 
 SECTION I. 1. The executive power shall be vested in a 
 President of the United States of America. He shall hold his 
 office during the term of four years; and, together with the 
 Vice-President chosen for the same term, be elected as follows: 
 
 2. Each State shall appoint, in such manner as the legis- 
 ture thereof may direct, a number of electors equal to the 
 whole number of senators and representatives to which the 
 State may be entitled in the Congress; but no senator or rep- 
 resentative, or person holding an office of trust or profit under 
 the United States, shall be appointed an elector. 
 
 3. The electors shall meet in their respective States, and 
 vote by ballot for two persons, of whom one at least shall not 
 be an inhabitant of the same State with themselves. And 
 they s!;all make a list of all the persons voted for and of the 
 number of votes for each; which list they shall sign and cer- 
 tify and transmit sealed to the seat of government of the 
 United States, directed to the President of the Senate. The 
 President of the Senate shall, in the presence of the Senate and 
 House of Representatives, open all the certificates, and the 
 votes shall then be counted. The person having the greatest, 
 number of votes shall be the President, if such number be a 
 majority of the whole number of electors appointed; and if 
 there be more than one who have such a majority, and have 
 an equal number of votes, then the House of Representatives 
 shall immediately choose, by ballot, one of them for President
 
 The Constitution of the United States. 47 
 
 and if no person have a majority, then, from the five highest 
 on the list, the said House shall, in like manner, choose the 
 President. But in choosing the President the votes shall be 
 taken by States, the representation from each State having 
 one vote ; a quorum for this purpose shall consist of amember 
 or members from two-thirds of all the States, and a majority 
 of all the States shall be necessary to a choice. In every case, 
 after the choice of the President, the person having the 
 greatest number of votes of the electors shall be the Vice- 
 President. But if there should remain two or more who have 
 equal votes, the Senate shall choose from them, by ballot, the 
 Vice-President. 
 
 4. The Congress may determine the time of choosing the 
 electors, and the day on which they shall give their votes, 
 which day shall be the same throughout the United States. 
 
 5. No person, except a natural-born citizen, or a citizen 
 of the United States at the time of the adoption of this Con- 
 stitution, shall be eligible to the office of President; neither 
 shall any person be eligible to that office who shall not have 
 attained the age of thirty-five years, and been fourteen years 
 a resident within the United States. 
 
 6. In case of the removal of the President from office, or 
 of his death, resignation, or inability to discharge the powers 
 and duties of the said office, the same shall devolve on the 
 Vice-President; and the Congress may, by law, provide for the 
 case of removal, death, resignation or inability, both of the 
 President and Vice-President, declaring what officer shall then 
 act as President; and such officer shall act accordingly, until 
 the disability be removed, or a President shall be elected. 
 
 7. The President shall, at stated times, receive for his 
 services a compensation, which shall neither be increased nor 
 diminished during the period for which he shall have been 
 elected; and he shall not receive within that period any other 
 emolument from the United States, or any of them. 
 
 8. Before he enter on the execution of his office, he shall 
 take the following oath or affirmation: 
 
 "I do solemnly swear (or affirm) that I will faithfully exe- 
 cute the office of President of the United States; and will, to 
 the best of my ability, preserve, protect and defend the Con- 
 stitution of the United States." 
 
 SECTION II. 1. The President shall be commander-in- 
 chief of the army and navy of the United States, and of the 
 militia of the several States, when called into the actual serv- 
 ice of the United States. He may require the opinion, in 
 writing, of the principal officer in each of the executive de- 
 partments, upon any subject relating to the duties of their 
 respective offices, and he shall have power to grant reprieves
 
 48 The Constitution of the United States. 
 
 and pardons for offenses against the United States, except in 
 cases of impeachment. 
 
 2. He shall have power, by and with the advice and con- 
 sent of the Senate, to make treaties, provided two-thirds of 
 the Senators present concur; and he shall nominate, and, by 
 and with the advice and consent of the Senate, shall appoint 
 embassadors, other public ministers and consuls, judges of the 
 Supreme Court, and all other officers of the United States 
 whose appointments are not herein otherwise provided for, 
 and which shall be established by law. But the Congress 
 may, by law, vest the appointment of such inferior officers as 
 they think proper in the President alone, in the courts of law, 
 or in the heads of departments. 
 
 3. The President shall have power to fill all vacancies 
 that may happen during the recess of the Senate, by granting 
 commissions which shall expire at the end of their next 
 session. 
 
 SECTION III. 1. He shall, from time to time, give to the 
 Congress information of the state of the Union, and recom- 
 mend to their consideration such measures as he shall judge 
 necessary and expedient. He may, on extraordinary occa- 
 sions, convene both houses, or either of them; and in case of 
 disagreement between them, with respect to the time of ad- 
 journment, he may adjourn them to such time as he shall 
 think proper. He shall receive embassadors and other public 
 ministers. He shall take care that the laws be faithfully exe- 
 cuted; and shall commission all officers of the United States. 
 
 SECTION IV. 1. The President, Vice-President and all 
 civil officers of the United States shall be removed from office 
 on impeachment for, and conviction of, treason, bribery, or 
 other high crimes and misdemeanors. 
 ARTICLE III. 
 
 SECTION I. 1. The judicial power of the United States 
 shall be vested in one Supreme Court and in such inferior 
 courts as Congress may from time to time ordain and estab- 
 lish. The judges both of the Supreme and inferior courts 
 shall hold their offices during good behavior; and shall, at 
 stated times, receive for their services a compensation which 
 shall not be diminished during their continuance of office. 
 
 SECTION II. 1. The judicial power shall extend to all 
 cases in law and equity arising under this Constitution, the 
 laws of the United States, and treaties made, or which shall 
 be made, under their authority; to all cases affecting embas- 
 sadors, other public ministers and consuls; to all cases of ad- 
 miralty and maritime jurisdiction; to controversies to which 
 the United States shall be a party; to controversies between 
 two or more States, between a State and citizens of another
 
 The Constitution of the United States. 49 
 
 State, between citizens of different States, between citizens of 
 the same State claiming lands under grants of different States, 
 and between a State, or the citizens thereof, and foreign 
 states, citizens, or subjects. 
 
 2. In all cases affecting embassadors, other public minis- 
 ters and consuls, and those in which a State shall be a party, 
 the Supreme Court shall have original jurisdiction. In all the 
 other cases mentioned, the Supreme Court shall have appellate 
 jurisdiction, both as to law and fact, with such exceptions and 
 under such regulations as the Congress shall make. 
 
 3. The trial of all crimes, except in cases of impeach- 
 ment, shall be by jury, and such trial shall be held in the 
 State where the said crime shall have been committed; but 
 when not committed within any State, the trial shall be at 
 such place or places as the Congress may by law have directed. 
 
 SECTION III. 1. Treason against the United States shall 
 consist only in levying war against them or in adhering to 
 their enemies, giving them aid and comfort. No person shall 
 be convicted of treason unless on the testimony of two wit- 
 nesses to the same overt act, or on confession in open court. 
 
 2. The Congress shall have power to declare the punish- 
 ment of treason ; but no attainder of treason shall work cor- 
 ruption of blood, or forfeiture, except during the life of the 
 person attainted. 
 
 'ARTICLE IV. 
 
 SECTION I. 1. Full faith and credit shall be given ineach 
 State to the public acts, records and judicial proceedings of 
 every other State; and the Congress may, by general laws, 
 prescribe the manner in which such acts, records and pro- 
 ceedings shall be proved, and the effect thereof. 
 
 SECTION II. 1. The citizens of each State shall be en- 
 titled to all privileges and immunities of citizens in the several 
 States. 
 
 2. A person charged in any State with treason, felony, or 
 other crime, who shall flee from justice, and be found in an- 
 other State, shall, on demand of the executive authority of the 
 State from which he fled, be delivered up to be removed to the 
 State having jurisdiction of the crime. 
 
 3. No person held to service or labor in one State under 
 the laws thereof, escaping into another, shall, in consequence 
 of any laws or regulations therein, be discharged from such 
 service or labor; but shall be delivered up on claim of the 
 party to whom such service or labor may be due. 
 
 SECTION III. 1. New States may be admitted by the 
 Congress into this Union; but no new State shall be formed or 
 erected within the jurisdiction of any other State, nor any
 
 50 The Constitution of the United States. 
 
 State be formed by the junction of two or more States or parts 
 of States, without the consent of the legislatures of the 
 States'concerned, as well as of the Congress. 
 
 2. The Congress shall have power to dispose of, and make 
 all needful rules and regulations respecting the territory or 
 other property belonging to the United States; and nothing in 
 this Constitution shall be so construed as to prejudice any 
 claim of the United States, or of any particular State. 
 
 SECTION IV. 1. The United States shall guarantee to 
 every State in this Union a republican form of government, 
 and shall protect each of them against invasion; and, on ap- 
 plication of the legislature, or of the executive (when the 
 legislature cannot be convened), against domestic violence. 
 
 ARTICLE V. 
 
 1. The Congress, whenever two-thirds of both houses 
 shall deem it necessary, shall propose amendments to this Con- 
 stitution; or, on the application of the legislatures of two- 
 thirds of the several States, shall call a convention for pro- 
 posing amendments, which, in either case, shall be valid to all 
 intents and purposes as part of this Constitution, when rati- 
 fied by the legislatures of three-fourths of the several States, 
 or by conventions in three-fourths thereof, as the one or the 
 other mode of ratification may be proposed by the Congress; 
 provided, that no amendment which may be made prior to the 
 year one thousand eight hundred and eight shall in any man- 
 ner affect the first and fourth clauses in the ninth section of 
 the fifth article; and that no State, without its consent, shall 
 be deprived of its equal suffrage in the Senate. 
 
 ARTICLE VI. 
 
 1. All debts contracted and engagements entered into 
 before the adoption of this Constitution shall be as valid 
 against the United States' under this Constitution as under 
 the Confederation. 
 
 2. This Constitution, and the laws of the United States 
 which shall be made in pursuance thereof, and all treaties 
 made, or which shall be made, under the authority of the 
 United States, shall be the supreme law of the land; and the 
 judges in every State shall be bound thereby, anything in the 
 Constitution or laws of any State to the contrary notwith- 
 standing. 
 
 3. The senators and representatives before mentioned 
 and the members of the several State legislatures, and all ex- 
 ecutive and judicial officers, both of the United States and the 
 several States, shall be bound by oath or affirmation to sup-
 
 The Constitution of the United States. 51 
 
 port this Constitution; but no religious test shall ever be re- 
 quired as a qualification to any office or public trust under the 
 United States. 
 
 ARTICLE VII. 
 
 1. The ratification of the convention of nine States shall 
 be sufficient for the establishment of this Constitution between 
 the States so ratifying the same. 
 
 Done in convention by the unanimous consent of 
 the States present, the seventeenth day of Decem- 
 ber, in the year of our Lord one thousand seven hun- 
 dred and eighty, and of the Independence of the 
 United States of America the twelfth. In witness 
 whereof we have hereunto subscribed our names. 
 
 GEORGE WASHINGTON, 
 President, and Deputy from Virginia. 
 
 AMENDMENTS. 
 
 ARTICLE I. 
 
 Congress shall make no law respecting an establishment 
 of religion, or prohibiting the free exercise thereof; or abridg- 
 ing the freedom of speech or of the press; or the right of the 
 people peaceably to assemble, and to petition the government 
 for a redress of grievances. 
 
 ARTICLE II. 
 
 A well regulated militia being necessary to the security of 
 a free State, the right of the people to keep and bear arms 
 shall not be infringed. 
 
 ARTICLE III. 
 
 No soldier shall, in time of peace, be quartered in any 
 house without the consent of the owner, nor in time of war, 
 but in a manner to be prescribed by law. 
 
 ARTICLE IV. 
 
 The right of the people to be secure in their persons, 
 houses, papers and effects, against unreasonable searches and 
 seizures, shall not be violated; and no warrants shall issue but 
 upon probable cause, supported by oath or affirmation, and 
 particularly describing the place to be searched, and the per- 
 sons or things to be seized. 
 
 ARTICLE V. 
 
 Xo person shall be held to answer for a capital or other-
 
 52 The Constitution of the United States. 
 
 wise infamous crime, unless on a presentment or indictment of 
 a grand jury, except in cases arising in the land or naval forces, 
 or in the militia, when in actual service in time of war or pub- 
 lic danger; nor shall any person be subject for the same offense 
 to be twice put in jeopardy of life or limb, nor shall be com- 
 pelled, in any criminal case, to be a witness against himself, 
 nor be deprived of life, liberty, or property, without due pro- 
 cess of law; nor shall private property be taken for public use, 
 without just compensation. 
 
 ARTICLE VI. 
 
 In all criminal prosecutions, the accused shall enjoy the 
 right to a speedy and public trial, by an impartial jury of the 
 State and district wherein the crime shall have been com- 
 mitted, which district shall have been previously ascertained 
 by law; and to be informed of the nature and cause of the ac- 
 cusation; to be confronted with the witnesses against him; to 
 have compulsory process for obtaining witnesses in his favor, 
 and to have the assistance of counsel for his defense. 
 
 ARTICLE VII. 
 
 In suits at common law, where the value in controversy 
 shall exceed twenty dollars, the right of trial by jury shall be 
 preserved; and no fact tried by a jury shall be otherwise re- 
 examined, in any court of the United States, than according to 
 the rules of the common law. 
 
 ARTICLE VIII. 
 
 Excessive bail shall not be required, nor excessive fines 
 imposed, nor cruel and unusual punishment inflicted. 
 
 ARTICLE IX. 
 
 The enumeration in the Constitution of certain rights 
 shall not be construed to deny or disparage others retained by 
 the people. 
 
 ACTICLE X. 
 
 The powers not delegated to the United States by the 
 Constitution, nor prohibited by it to the States, are reserved 
 to the States respectively, or to the people. 
 
 [The preceding ten amendatory articles were proposed to the 
 legislatures of the States by the first Congress. September 25, 1789. 
 and notification of ratification received from all the States except 
 Connecticut, Georgia and Massachusetts.] 
 
 ARTICLE XI. 
 
 The judicial power of the United States shall not be con-
 
 The Constitution of the United States. 53 
 
 strued to extend to any suit in law or equity commenced or 
 prosecuted against one of the United States by citizens or sub- 
 jects of any foreign state. 
 
 [Proposed by the Third Congress, and Congress notified of its 
 adoption January 8, 1798.] 
 
 ARTICLE XII. 
 
 1. The electors shall meet in their respective States, and 
 vote by ballot for President and Vice-President, one of whom, 
 at least, shall not be an inhabitant of the same State with 
 themselves. They shall name in their ballots the person voted 
 for as President, and in distinct ballots the person voted for 
 as Vice-President; and they shall make distinct lists of all 
 persons voted for as President, and of all persons voted for as 
 Vice-President; and of the number of votes for each; which 
 lists they shall sign and certify, and transmit sealed to the 
 seat of government of the United States, directed to the Presi- 
 dent of the Senate. The President of the Senate shall, in the 
 presence of the Senate and House of Representatives, open the 
 certificates, and the votes shall then be counted. The person 
 having the greatest number of votes for President shall be the 
 President, if such number be a majority of the whole number 
 of electors appointed; and if no person have such majority, 
 then from the persons having the highest numbers, not ex- 
 ceeding three on the list of those voted for as President, the 
 House of Representatives shall choose immediately, by ballot, 
 the President. But, in choosing the President, the votes shall 
 be taken by States, the representation from each State having 
 one vote; a quorum for this purpose shall consist of a member 
 or members from two-thirds of the States, and a majority of 
 all the States shall be necessary to a choice. And if the 
 House of Representatives shall not choose a President when- 
 ever the right of choice shall devolve upon them, before the 
 fourth day of March next following, then the Vice-President 
 shall act as President, as in the case of the death or other con- 
 stitutional disability of the President. 
 
 2. The person having the greatest number of votes as 
 Vice-President shall be the Vice-President, if such number be 
 a majority of the whole number of electors appointed, and if 
 no person have a majority, then from the two highest numbers 
 on the list the Senate shall choose the Vice-President. A 
 quorum for the purpose shall consist of two-thirds of the whole, 
 number of senators, and a majority of the whole number shal 
 be necessary to a choice. 
 
 3. But no person constitutionally ineligible to the office 
 of President shall be eligible to that of Vice-President of the 
 United States.
 
 54 The Constitution of the United States. 
 
 [Proposed by the Eighth Congress, and declared adopted Sep- 
 tember 25, 1804, by proclamation of the Secretary of State.] 
 
 ARTICLE XIII. 
 
 1. Neither slavery nor involuntary servitude, except as a 
 punishment for crime, whereof the party shall have been duly 
 convicted, shall exist within the United States, or any place 
 subject to their jurisdiction. 
 
 2. Congress shall have power to enforce this article by 
 appropriate legislation. 
 
 [Proposed by the Thirty-eighth Congress, and declared adopted 
 December 18, 1865, by proclamation of the Secretary of Btate.] 
 
 ARTICLE XIV. 
 
 SECTION I. All persons born or naturalized in the United 
 States, and subject to the jurisdiction thereof, are citizens of 
 the United States and of the State wherein they reside. No 
 State shall make or enforce any law which shall abridge the 
 privileges or immunities of citizens of the United States, nor 
 shall any State deprive any person of life, liberty, or property, 
 without due process of law, nor deny to any person within its 
 jurisdiction the equal protection of the laws. 
 
 SECTION II. Representatives shall be apportioned among 
 the several States according to their respective numbers, 
 counting the whole number of persons in each State, exclud- 
 ing Indians not taxed. But when the right to vote at any 
 election for the choice of electors for President and Vice-Presi- 
 dent of the United States, representatives in Congress, the 
 executive and judicial officers of a State, or the members of 
 the legislature thereof, is denied to any of the male inhabit- 
 ants of such State, being twenty-one years of age, and citizens 
 of the United States, or in any way abridged, except for par- 
 ticipation in rebellion or other crime, the basis of representa- 
 tion therein shall be reduced in the proportion which the num- 
 ber of such male citizens shall bear to the whole number of 
 male citizens twenty-one years of age in such State. 
 
 SECTION III. No person shall be a senator or representa- 
 tive in Congress, or elector of President and Vice-President, or 
 hold any office, civil or military, under the United States, or 
 under any State, who, having previously taken an oath as a 
 member of Congress, or as an officer of the United States, or 
 as a member of any State legislature, or as an executive or 
 judicial officer of any State, to support the Constitution of the 
 United States, shall have engaged in insurrection or rebellion 
 against the same, or given aid or comfort to the enemies there 
 of; but Congress may, by a vote of two-thirds of each house, 
 remove such disability.
 
 The Constitution of the United States. 55 
 
 SECTION IV. The validity of the public debt of the United 
 States, authorized by law, including debts incurred for pay- 
 ment of pensions and bounties for services in suppressing in- 
 surrection or rebellion, shall not be questioned. But neither 
 the United States nor any State shall assume or pay any debt 
 or obligation incurred in aid of insurrection or rebellion against 
 the United States, or any claim for the loss or emancipation of 
 any slave; but all such debts, obligations and claims shall be 
 held illegal and void. 
 
 SECTION V. The Congress shall have power to enforce, by 
 appropriate legislation, the provisions of this article. 
 
 [Proposed by the Thirty-ninth Congress and declared adopted 
 by concurrent resolution of Congress, July 21, 1868.] 
 
 ARTICLE XV. 
 
 SECTION I. The right of citizens of the United States to 
 vote shall not be denied or abridged by the United States,or 
 any State, on account of race, color or previous condition of 
 servitude. 
 
 SECTION II. The Congress shall have power to enforce 
 this article by appropriate legislation. 
 
 [Proposed by the Fortieth Congress, and declared adopted by 
 proclamation of the Secretary of State, March 30, 1870.] 
 
 Workingmen Easily Gulled. 
 
 Who fought for King George in 1776 ? Working people. 
 
 What interest did they have inbeing ruled by him? None. 
 
 Why, then, did they risk their lives for him? Because he 
 hired them. 
 
 Where did the king get the money to pay them? By tax- 
 ing them. 
 
 Then they really paid themselves for righting? Certainly. 
 
 In every war ever fought the working people paid the ex- 
 penses. Why did they do it? For the same reason that 
 working people rote the same ticket as the Pullmans, Cleve- 
 lands, Carlifles, Shermans and their fellows they don't 
 know any better. They can't see the cat. 
 
 Will they ever learn better? Oh, maybe. 
 
 ' ' WHAT constitutes a state ? . . . 
 . . . Men who their duties know, 
 But know their rights, and, knowing, 
 Dare maintain." Jonet.
 
 & "Oppression, injustice and poverty shall cease in the land" 
 
 THE NEW DECLARATION OF INDEPENDENCE. 
 
 % 
 
 Preamble and Platform of the Peoples Party. 
 
 Unanimously Adopted at the First National Convention at 
 Omaha, on the fourth day of July, 1892. 
 
 ASSEMBLED upon the one hundred and sixteenth anni- 
 * * versary of the Declaration of Independence, the People's 
 Party of America, in their first national convention, invoking 
 upon their action the blessing of Almighty God, put forth, in 
 the name and on behalf of the people of this country, the fol- 
 lowing preamble and declaration of principles: 
 
 PREAMBLE. 
 
 The conditions which surround us best justify our co-op- 
 eration. We meet in the midst of a nation brought to the 
 verge of moral, political and material ruin. Corruption dom- 
 inates the ballot-box, the legislatures, the Congress, and 
 touches even the ermine of the bench. The people are de- 
 moralized; most of the States have been compelled to isolate 
 the voters at the polling-places, to prevent universal intimida- 
 tion or bribery. The newspapers are largely subsidized or 
 muzzled; public opinion silenced; business prostrated; our 
 homes covered with mortgages; labor impoverished, and the 
 lands concentrating in the hands of the capitalists. The 
 urban workmen are denied the right of organization for self- 
 protection; imported pauperized labor beats down their wages; 
 a hireling standing army, unrecognized by our laws, is estab- 
 lished to shoot them down, and they are rapidly degenerating 
 into European conditions. The fruits of the toil of millions 
 are boldly stolen to build up colossal fortunes for a few, un- 
 precedented in the history of mankind, and the possessors of 
 these, in turn, despise the Republic and endanger liberty. 
 From the same prolific womb of governmental injustice we 
 breed the two great classes tramps and millionaires. 
 
 The national power to create money is appropriated to 
 enrich bondholders. A vast public debt, payable in legal 
 tender currency, has been funded into gold-bearing bonds, 
 thereby adding millions to the burdens of the people. 
 
 Silver, which has been accepted as coin since the dawn of 
 history, has been demonetized to add to the purchasing power 
 of gold, by decreasing the value of all forms of property as 
 well as human labor, and the supply of currency is purposely 
 
 56
 
 The New Declaration of Independence. 57 
 
 abridged to fatten usurers, bankrupt enterprise, and enslave 
 industry. A vast conspiracy against mankind has been organ- 
 ized on two continents, and is rapidly taking possession of the 
 world. If not met and overthrown at once, it forebodes terri- 
 ble social convulsions, the destruction of civilization, or the 
 establishment of an absolute despotism. We have witnessed 
 for more than a quarter of a century the struggles of the two 
 great political parties for power and plunder, while grievous 
 wrongs have been inflicted upon the suffering people. We 
 charge that the controlling influences dominating both these 
 parties have permitted the existing dreadful conditions to de- 
 velop without serious effort to prevent or restrain them. 
 Neither do they now promise us any substantial reform. They 
 have agreed together to ignore in the coming campaign every 
 issue but one. They propose to drown the outcries of a plun- 
 dered people with the uproar of a sham battle over the tariff, 
 so that capitalists, corporations, national banks, rings, trusts, 
 watered stock, the demonetization of silver and the oppress- 
 ions of the usurers may all be lost sight of. They propose to 
 sacrifice our homes, lives and children on the altar of Mam- 
 mon; to destroy the multitude in order to secure corruption 
 funds from the millionaires. 
 
 Assembled on the anniversary of the birthday of the na- 
 tion, and filled with the spirit of the grand generation who es- 
 tablished our independence, we seek to restore the government 
 of the Republic to the hands of "the plain people," with whose 
 class it originated. We assert our purposes to be identical 
 with the purposes of the National Constitution "to form a 
 more perfect union, establish justice, insure domestic tran- 
 quillity, provide for the common defense, promote the general 
 welfare and secure the blessings of liberty for ourselves and 
 our posterity." 
 
 We declare that this Republic can only endure as a free 
 government while built upon the love of the whole people for 
 each other and for the nation; that it cannot be pinned to- 
 gether by bayonets; that the civil war is over, and that every 
 passion and resentment which grew out of it must die with it, 
 and that we must be in fact, as we are in name, one united 
 brotherhood of freemen. 
 
 Our country finds itself confronted by conditions for 
 which there is no precedent in the history of the world. Our 
 annual agricultural productions amount to billions of dollars 
 in value, which must within a few weeks or months be ex- 
 changed for billions of dollars of commodities consumed in 
 their production; the existing currency supply is wholly in- 
 adequate to make this exchange; the results are falling prices, 
 the formation of combines and rings, the impoverishment of
 
 58 The New Declaration of Independence. 
 
 the producing class. We pledge ourselves that, if given 
 power, we will labor to correct these evils by wise and reason- 
 able legislation in accordance with the terms of our platform. 
 
 We believe that the powers of government in other 
 words, of the people should be expanded (as in the case of 
 the postal service) as rapidly and as far as the good sense of 
 an intelligent people and the teachings of experience shall jus- 
 tify, to the end that oppression, injustice and poverty shall 
 eventually cease in the land. 
 
 While our sympathies as a party of reform are naturally 
 upon the side of every proposition which will tend to make 
 men intelligent, virtuous and temperate, we nevertheless re- 
 gard these questions, important as they are, as secondary to 
 the great issues now pressing for solution, and upon which 
 not only our individual prosperity but the very existence of 
 free institutions depends; and we ask all men to first help us 
 to determine whether we are to have a republic to administer 
 before we differ as to the condition upon which it is to be ad- 
 ministered; believing that the forces of reform this day organ- 
 ized will never cease to move forward until every wrong is 
 remedied, and equal rights and equal privileges securely estab- 
 lished for all the men and women of this country. We de- 
 clare, therefore: 
 
 DECLARATION OP PRINCIPLES. 
 
 First That the union of the labor forces of the United 
 States this day consummated shall be permanent and perpet- 
 ual. May its spirit enter into all hearts for the salvation of 
 the Republic and the uplifting of mankind. 
 
 Second Wealth belongs to him who creates it, and every 
 dollar taken from industry without an equivalent is robbery. 
 "If any will not work, neither shall he eat." The interests of 
 rural and civic labor are the same; their enemies are identical. 
 
 Third We believe that the time has come when the rail- 
 road corporations will either own the people or the people 
 must own the railroads, and should the government enter 
 upon the work of owning and managing any or all railroads, 
 we should favor an amendment to the Constitution by which 
 all persons engaged in the government service shall be placed 
 under a civil service regulation of the most rigid character, so 
 as to prevent the increase of the power of the national admin- 
 istration by the use of such additional government employes. 
 
 FINANCE AND CURRENCY. 
 
 We demand a national currency, safe, sound and flexible, 
 issued by the general government only, a full legal-tender for 
 all debts, public and private; and that, without the use of
 
 The New Declaration of Independence. 59 
 
 banking corporations, a just, equitable and efficient means of 
 distribution direct to the people, at a tax not to exceed two 
 per cent, per annum, be provided, as set forth in the sub-treas- 
 ury plan of the Farmers' Alliance, -or a better system; also by 
 payments in discharge of its obligations for public improve- 
 ments. 
 
 1. We demand free and unlimited coinage of silver and 
 gold at the present legal ratio of 16 to 1. 
 
 2. We demand that the amount of circulating medium be 
 speedily increased to not less than 850 per capita. 
 
 3. We demand a graduated income tax. 
 
 4. We believe that the money of the country snould be 
 kept as much as possible in the hands of the people, and hence 
 we demand that all State and national revenues shall be lim- 
 ited to the necessary expenses of the government, economic- 
 ally and honestly administered. 
 
 5. We demand that postal savings banks be established 
 by the Government for the safe deposit of the earnings of the 
 people, and to facilitate exchange. 
 
 TRANSPORTATION. 
 
 Transportation being a means of exchange and a public 
 necessity, the government should own and operate the rail- 
 roads in the interest of the people. 
 
 The telegraph and telephone, like the post-office system, 
 being a necessity for the transmission of news, should be 
 owned and operated by the government in the interest of the 
 people. 
 
 LAND OWNERSHIP. 
 
 The land, including all the natural resources of wealth, io 
 the heritage of the people, and should not be monopolized for 
 speculative purposes, and alien ownership of land should be 
 prohibited. All land now held by railroads and other corpor- 
 ations in excess of their actual needs, and all lands now owned 
 by aliens, should be reclaimed by the government and held 
 for actual settlers only. 
 
 SUPPLEMENTAL, RESOLUTIONS. 
 
 WHEREAS, Other questions have been presented for our 
 consideration, we hereby submit the following, not as a part of 
 the platform of the People's Party, but as resolutions express 
 ive of the sentiment of this convention: 
 
 Resolved, First, That we demand a free ballot and a fair 
 count in ail elections, and pledge ourselves to secure it to every 
 legal voter without Federal intervention through the adoption
 
 60 The New Declaration of Independence. 
 
 by the States of the unperverted Australian or secret ballot 
 system. 
 
 Resolved, Second, That the revenue derived from a grad- 
 uated income tax should be applied to the reduction of the 
 burden of taxation now levied upon the domestic industries of 
 this country. 
 
 Resolved, Third, That we pledge our support to fair and 
 liberal pensions of ex-Union soldiers and sailors. 
 
 Resolved, Fourth, That we condemn the fallacy of pro- 
 tecting American labor under the present system, which opens 
 our ports to the pauper and criminal classes of the world, and 
 crowds out our wage-earners; and we denounce the present in- 
 effective laws against contract labor, and demand the further 
 restriction of undesirable immigration. 
 
 Resolved, Fifth, That we cordially sympathize with the 
 efforts of organized workingmen to shorten the hours of labor, 
 and demand a rigid enforcement of the existing eight-hour 
 law on government work, and ask that a penalty clause be 
 added to the said law. 
 
 Resolved, Sixth, That we regard the maintenance of a 
 large standing army of mercenaries, known as the Pinkerton 
 system, as a menace to our liberties, and we demand its aboli- 
 tion; and we condemn the recent invasion of the Territory of 
 Wyoming by the hired assassins of plutocracy, assisted by 
 Federal officers. 
 
 Resolved, Seventh, That we commend to the thoughtful 
 consideration of the people and the reform press the legisla- 
 tive system known as the ab initio ad referendum. 
 
 Resolved, Eighth, that we favor a constitutional provision 
 limiting the offices of President and Vice-President to one 
 term, and providing for the election of senators of the United 
 States by a direct vote of the people. 
 
 Resolvec\ Ninth, That we oppose any subsidy or national 
 aid to any private corporation for any purpose. 
 
 "THE magnificent conservative forces of our Republic live 
 upon its farms. There is our safety in the hour of trial. 
 Rome fell because her loafers and cityites were the only 
 voters. They had no homes to protect they had only votes 
 to sell." John Me Govern. 
 
 
 
 " BUT words are things, and a small drop of ink, 
 Falling, like dew, upon a thought, produces 
 That which makes thousands, perhaps millions, think." 
 
 Byron.
 
 y " This Republic can endure only while built upon the love 
 of the whole people for each other and for the nation . ' ' 
 
 A NEW STUDY OF POLITICAL ECONOMY. 
 
 Based on the Omaha Platform. 
 
 ECONOMY is the Anglicized form of a Greek word meaning 
 household management. Political economy may there- 
 fore be defined as the management of the political household. 
 It is the object of this book to look into the management of the 
 political household known as the United States of America. 
 Every citizen shares in the responsibility of managing this 
 household, and should therefore make it his business to be in- 
 formed on every question concerning it. Rich or humble, 
 learned or otherwise, it is his duty to see for himself and not 
 to allow professional politicians or interested parties to do his 
 thinking for him. Citizen politicians, as distinguished from 
 professional politicians, should manage the affairs of this na- 
 tion. 
 
 The first thing an American citizen should do is to rid 
 himself of the erroneous idea that to engage in politics is dis- 
 honorable. Politicians may be dishonest, quite frequently are, 
 in fact; but that is because the people permit them to be. The 
 prevailing idea of politics to-day is that it is "the art of get- 
 ting there if you can." Chambers, however, defines it as fol- 
 lows: 
 
 "That branch of ethics which has for its subject the 
 proper mode of governing a state, so as to secure its prosper- 
 ity, peace and safety, and to attain, as perfectly as possible, the 
 ends of civil society. Among the subjects which political 
 science embraces are the principles on which government is 
 founded, the hands in which the supreme power may be most 
 advantageously placed, the duties and obligations of the 
 governing and the governed portions of society, the develop- 
 ment and increase of the resources of the state, the protection 
 of the rights and liberties of the citizens, the preservation of 
 the morals and the defense of the independence of the State 
 against foreign control or conquest. While the philosophy of 
 governing constitutes the science of politics, the art of politics
 
 62 A New Study of Political Economy. 
 
 consists in the application of that science to the individual 
 circumstances of particular states." 
 
 The principles on which the government of our country 
 is founded are set forth in the Declaration of Independence 
 and the Constitution. The other subjects embraced in the 
 general term political science are now to be considered, and 
 they will be considered here with special reference to the plat- 
 form of principles promulgated by the People's Party. 
 
 The land in which we live is favored in natural resources 
 above all others on the planet, but in spite of all the blessings 
 of Providence, in spite of the acknowledged industry of an in- 
 telligent people, want, destitution and suffering prevail. Our 
 granaries are filled to overflowing and yet we read of starva- 
 tion. We read of over-production, and yet we see every day 
 men, women and children suffering from cold and hunger. 
 We have more millionaires than any other nation of history 
 and more paupers and the number of both is increasing. 
 There must be something wrong with our political economy. 
 
 Let us see where the trouble lies. 
 
 First, let us examine carefully the conditions which sur 
 round us then propose remedies. 
 
 The present chapter is intended as a general summary of 
 the Omaha platform the People's Party's solution of the great 
 economic problems of the day. A speech recently delivered 
 by Mr. W. Scott Morgan, of Arkansas, does this so logically 
 and so systematically that it was deemed wise to print it here. 
 Further on the more important subjects, and especially the 
 Initiative and Referendum, will be discussed at greater 
 length. 
 
 LADIES AND GENTLEMEN: I am glad to meet so many of 
 you here to-day. I a'm glad to know that the time has come 
 when party lines are resting so loosely that people are investi- 
 gating and want to know the truth. I am glad that we have 
 arrived at that point where mere promises and platforms will 
 not answer the demands of the people; that the people are 
 judging men and parties by the work they accomplish; that 
 the tree is judged by the fruit. By that measure we are will- 
 ing to be measured, and by that measure we propose to meas- 
 ure others. 
 
 My friends, I hope we have here as fellow-citizens. I hope
 
 A New Study of Political Economy. 63 
 
 no man's fealty to his party will prevent him from hearing 
 and knowing the truth. I believe that the masses of the peo- 
 ple are honest, and want to know the truth and do right. I 
 am not here to deceive you, or to defend a party record that 
 has not been in accord with the interests of the people, I be- 
 lieve in the principles of Democracy. I believe in the princi- 
 ples of Republicanism. Those principles are so nearly alike 
 that Thomas Jefferson belonged to both parties. The Demo- 
 cratic party was once called the Republican party to distin- 
 guish it from the Federal party, led by Hamilton. I say that 
 I am willing to stand upon the principles of Democracy, but I 
 want to belong to a party that is trying to carry out those 
 principles. 
 
 If you have voted the Democratic ticket, you have no 
 doubt done what you thought best. If you have voted the 
 Republican ticket, you have done the same. A Populist has 
 done no more. We are all citizens of a common country. Our 
 interests are the same. We all love our families, our homes, 
 our country and its flag. If we are good citizens we place 
 each of those things above party, and God above all. 
 
 And now, my friends, I want to tell you a little anecdote, 
 and hope you will all make the right application of it. A 
 friend of mine, Joe Taggart, told Bill Skinner he believed 
 there were a hundred rats under his barn. Bill suggested 
 that he had better come down a rat or two, but Joe wouldn't 
 do it, and finally they made a bet, Bill betting 55 there weren't 
 a hundred rats there. Joe got a long pole, and said he would 
 get under the barn and stir the rats up, and Bill could count 
 them. Bill said that was all right. Joe crawled under the 
 barn and began to punch around, and presently the whole 
 ground was covered with rats. Directly Joe called out: "How 
 many rats do you see, Bill?" "Not a rat," said Bill. Then 
 Joe did some more vigorous punching, and again asked Bill 
 how many he saw. "Didn't see a rat," replied Bill. Then Joe 
 raised a bigger racket than ever, and the rats fairly swarmed 
 and tumbled over each other. They were running out from 
 under the barn, across the lot, under the cribs, and two or 
 three actually ran over Bill, who was lying down, apparently 
 looking under the barn. "Do you see any now?" said Joe. 
 "Nary a rat," said Bill. Joe threw down his pole in disgust, 
 brushed the dirt off his clothes, and said: "Bill, why 
 couldn't you see the rats? They were running all over you." 
 "I had my eyes shut; I didn't want to see 'em," said Bill. 
 Now, my friends, I want to say that there is no bet up between 
 you and me. I hope you have not come out here with your 
 eyes shut. If there are any rats under the political barn it is 
 to your interest to eee them. I'm- going to punch around the
 
 64 A New Study of Political Economy. 
 
 old party barn today, and I want you all to keep your eyes 
 open and count the rats. It may be that some of you will 
 come to the conclusion that there are so many rats and other 
 pests that you will not want to stay any longer in that barn 
 for fear of being destroyed by vermin. 
 
 There is no sensible reason why the American working- 
 men, and especially the American farmers, should not be the 
 most prosperous and happy people on earth. In intelligence, 
 industry and natural productive resources we excel any other 
 nation in the world. Our commercial ships touch the ports of 
 every civilized nation. Our 165,000 miles of railway, spread- 
 ing a steel net over every part of our vast domain, furnish 
 means of transportation not equaled by any other country in 
 the world. Our natural resources are unparalleled. Yet. 
 with all the blessings of a kind providence on one hand, we 
 find want, destitution and suffering on the other, and we are 
 here to-day seeking information as to the causes of this anom- 
 alous condition. Over-production cannot solve the problem, 
 for want and suffering cannot exist when there is plenty, and 
 that properly and equitably distributed. Under-production, 
 or "nothing to Bell," will not solve it, for there is little demand 
 for what we have to sell ; besides, we have produced abun- 
 dantly for years. 
 
 There are a few men in this country who contend that 
 everything is lovely, and that we are getting on swimmingly. 
 They are mostly speculators. They are reaping a rich harvest 
 from low prices and the necessities of the people. Even 
 farmers who have a little money to speculate on, and are out 
 of debt, may profit in the prevailing hard times by speculating 
 on the necessities of their less fortunate neighbors who are 
 compelled to have money at any sacrifice of property. But 
 ninety-nine out of every one hundred persons know that labor 
 is not receiving its just reward; that the producer is not re- 
 ceiving an equitable share of the things produced. Where is 
 the man or woman who does not feel the pressure of hard 
 times? 
 
 The Burden of Debt. 
 
 In 1850 the farmers of this country owned 75 per cent of 
 its wealth. In 1890 they owned but 29 per cent of it. In 1865 
 the people were practically out of debt, except public debts. 
 In 1890 the most conservative estimates by reliable statisti- 
 cians place the entire indebtedness of the people at $32,000,- 
 000,000 thirty-two thousand million dollars. The census bul- 
 letin gives startling figures with regard to mortgage indebted- 
 ness on farms and homes. During the ten years from 1880 to 
 1890, there were 9,517,747 real estate mortgages placed on rec-
 
 A New Study of Political Economy. 65 
 
 ord in the United States, The debt incurred on account of 
 these mortgages was $12,094,877,793. In 1880 there were given 
 643,143 mortgages representing an indebtedness of $710,888,- 
 504. In 1889 there were given 1,226,323 mortgages represent- 
 ing an indebtedness of $1,752,568,274, or an increase of 90 per 
 cent in the number of mortgages and 146 per cent in the 
 amount of indebtedness. The real estate mortgage indebted- 
 ness existing January 1, 1890, was over six thousand million 
 dollars represented by nearly five million mortgages. Add to 
 this the State, county, municipal, corporate and other private 
 indebtedness, and it requires no stretch of the imagination to 
 believe that it all amounts to $32,000,000,000.* 
 
 The interest on this vast indebtedness will average not less 
 than 6 per cent. This makes an interest charge on the indus- 
 tries of the people of $1,920,000,000 per annum. This does not 
 include rents, taxes, dividends to corporations, tributes to 
 trusts and compulsory donations to rich manufacturers 
 through the insidious workings of a so-called protective tariff. 
 If we consider only the revenues that go into the public treas- 
 uries, national, State, county and municipal, it would reach in 
 the aggregate no less than $2,700,000,000. This is the fixed 
 annual tribute which the people of this country must pay, and 
 pay every dollar of it in money. This is the sum that we can 
 see that we do pay as distinguished from a larger sum, per- 
 haps, that we can only approximate by counting the number 
 of millionaires we create. 
 
 But what does $2,700,000,000 annual tribute mean? Di- 
 vided up among our sixty-five millions of people, it means $40 
 for every man, woman and child in the United States, and 
 enough left undivided to build a railroad across the continent 
 from New York to San Francisco. It means $200 to every 
 family of five persons. To every cotton raiser it means eight 
 bales of cotton at present prices. To every wheat raiser it 
 means 500 bushels of wheat. To the stock raiser it means 
 twenty-five to thirty hogs, or fifteen to twenty head of cattle. 
 To obtain the money to pay it you part with five times as much 
 cotton and wheat, and three times as much stock or other 
 products as you would twenty-eight years ago. But you say 
 you do not pay that much you do not raise that much cot- 
 ton, wheat or stock. That may be true, yet you pay more of 
 this vast sum than you think. You pay it in everything you 
 buy. You may not owe a dollar in the world, but your mer- 
 chant or manufacturer does, and when they sell the goods the 
 interest is charged up and the consumer pays it. You may 
 not pay your average proportion of that tribute, but you pay 
 
 *In a subsequent chapter it will be shown that the interest- 
 bearing debt of thia nation amounts to much more than this sum.
 
 66 A New Study of Political Economy. 
 
 in accordance with what you sell and buy, for you are taxed on 
 bo'.h. But this sum does not represent all of the burdens that 
 are borne by the people. A system of trusts controls the price 
 of every commodity that enters into general consumption, and 
 each one lays tribute on the people with the same remorseless 
 rapacity as the booted and spurred brigands of feudal ages, 
 but with much more safety for we live in an enlightened and 
 civilized age. Debt is slavery. It makes no difference 
 whether you owe a man your labor or the products of your 
 labor. In either case you are his slave. In the case of chattel 
 slavery the master drives you to work and appropriates the 
 proceeds of your labor. In the case of debt slavery necessity 
 compels you to work, and your creditor takes the proceeds of 
 your labor. The chattel slave is entitled to and receives a 
 good living, and his master takes the balance. In the other 
 case the creditor receives a good living and the debtor slave 
 takes the balance if the tax collector don't get it. 
 
 It is the same old question that has agitated the world 
 since the world began the rights of man and the rights of 
 property. The notes, bonds and mortgages representing the 
 $32,000,000,000 of indebtedness are as legal a title to the pro- 
 ceeds of American industry as were the deeds of conveyance of 
 African slaves to the proceeds of their labor under the institu- 
 tion of slavery. The same questions arise now that were up 
 then. Shall these slaves these American laborers be grad- 
 ually emancipated from debt slavery or shall debt slavery be 
 extended until other Sumners, Garrisons and Phillipses, by 
 their eloquence, stir up the public heart to the point of tramp- 
 ling on all legal safeguards, enactments and decisions, and 
 shoot it to death as they destroyed chattel slavery? We con- 
 cede that every man has a right to go into debt, but when he 
 contracts a debt we insist that he has a right to pay that debt 
 with money obtained with the same number of day's labor that 
 it represented when the debt was made. No man has a right 
 to demand a better dollar from his debtor than the dollar he 
 loaned him. Because of the immense indebtedness, and because 
 the equity of that indebtedness has been fraudulently changed 
 by increasing the purchasing value of the dollar, we consider 
 the money question paramount to all others. 
 
 One of the greatest obstacles we have to overcome is mis- 
 representation. People call us cranks who never read our 
 platform. When people take the pains to investigate and un- 
 derstand our principles, they avoid placing themselves in lu- 
 dicrous positions and saying many silly things. 
 
 Finance, Transportation and Land. 
 
 Finance, transportation and land are the cardinal princi-
 
 A New Study of Political Economy. 67 
 
 pies of our platform. On these we are willing to be measured 
 by the standard of the Democracy of Thomas Jefferson or the 
 Republicanism of Abraham Lincoln. If we are not in accord 
 with the teachings of Jefferson and Lincoln, then we give you 
 permission to say that all our professions are as "sounding 
 brass or a tinkling cymbal." 
 
 Finance. 
 
 On the question of finance our platform declares: 
 
 "We demand a national currency, safe, sound and flexible, 
 issued by the general government only; a full legal tender for 
 all debts, public and private; and that without the use of bank- 
 ing corporations, a just, equitable and efficient means of dis- 
 tribution direct to the people, at a tax not exceeding 2 per cent 
 per annum, be provided, as set forth in the sub-treasury plan 
 of the Farmers' Alliance, or some better system; also by pay- 
 ments in discharge of its obligations for public improvements. 
 
 "We demand the free and unlimited coinage of silver and 
 gold at the present legal ratio of sixteen to one. 
 
 "We demand that the amount of the circulating medium 
 be speedily increased to not less than $50 per capita." 
 
 This plank analyzed means: 
 
 1. A safe, sound and flexible currency. 
 
 2. It shall be a full legal tender for all debts. 
 
 3. It shall be issued by the government, and not by the 
 banks. 
 
 4. It may be loaned to the people at a tax of not more 
 than 2 per cent. 
 
 5. It may be paid out for public improvements. 
 
 6. Free coinage of silver at the ratio of sixteen to one. 
 
 7. Circulating medium to amount to $50 per capita. 
 
 No one will take issue with us on the first of these propo- 
 sitions, and we see no reason why they should on the second. 
 Certainly no one in the West or South would. Let every dollar 
 issued be issued to pay our debts to the rich as well as to buy 
 the products of the poor. 
 
 OPPOSED TO BANKS OF ISSUE. 
 
 3. "It shall be issued by the government and not by the 
 banks." 
 
 This is in accordance with old-time Democratic doc- 
 trine, but not with modern Democratic practice. Here is the 
 expression of the Democratic party in 1840 on banks of issue: 
 
 Plank 6. "Resolved, That Congress has no power to char- 
 ter a United States bank; that we believe such an institution 
 one of deadly hostility to the best interests of the country,
 
 68 A New Study of Political Economy. 
 
 dangerous to our republican institutions and the liberties of 
 the people, and calculated to place the business of the coun- 
 try within the control of a concentrated money power and 
 above the laws and will of the people." 
 
 This plank was reaffirmed in every platform up to 1860. 
 Since that time the Democratic party has made no declara- 
 tion of hostility to national banks in any of its national plat- 
 forms. 
 
 In a letter to Mr. Gallatin, in 1803, Thomas Jefferson 
 said: "This institution is one of the most deadly hostility 
 existing against the principles and form of government." At 
 another time he said: "Bank paper must be suppressed and 
 the circulation restored to the nation, to whom it belongs." 
 In volume 7, page 147, of Jefferson's Works, he treats this ques- 
 tion in the following words: 
 
 "Certainly no nation ever before abandoned to the avarice 
 and juggling of private individuals to regulate, according to 
 their own interests, the quantum of circulating medium for 
 the nation. To inflate by deluges of paper the nominal prices 
 of property, and then to buy that property at one shilling on 
 the pound, first having withdrawn their floating medium, 
 which might endanger a competition in the purchase. Yet 
 this is what has been done, and will continue to be done un- 
 less stayed by the protecting hand of our legislatures. The 
 evil has been produced by the error of their sanction of this 
 ruinous machinery of banks, and justice, wisdom, duty, all re- 
 quire that they interpose and arrest it before the schemes of 
 plunder and spoliation desolate our country. If we suffer the 
 moral of the present lesson to pass away without improvement 
 by the eternal suppression of bank paper, then, indeed, is the 
 condition of our country desperate. Interdict forever to both 
 State and national government the power of establishing any 
 paper bank, for without this interdiction we shall have the 
 same ebbs and flows of medium, and the same revolutions of 
 property, to go through every twenty or thirty years." 
 
 In these words Mr. Jefferson very distinctly points out the 
 cause of the periodical panics and business depressions we 
 have had in this country every twenty or thirty years. If he 
 lived in this age he would be called a crank and calamity 
 howler. This is exactly the position Populists take. We claim 
 with Mr. Jefferson that as long as the banks issue the money, 
 and thus control its volume, we will have panics and periods 
 of business depression. 
 
 In a letter to Mr. Epps, dated November 6, 1813, Mr. Jef- 
 ferson said: 
 
 "At the time we were funding our national debt we heard 
 much about a 'public debt being a public blessing;' that the
 
 A New Study of Political Economy. 69 
 
 stock representing it was a creation of active capital for the 
 ailment of commerce, manufactures and agriculture. 
 
 "But the art and mystery of banks is a wonderful im- 
 provement on that. It is established on the principle that 
 private debts are a public blessing. 
 
 "And to fill up the measure of blessing, instead of paying 
 they receive interest on what they owe from those to whom 
 they owe; for all the notes, or evidence of what they owe, 
 which we see in circulation, have been lent to somebody on an 
 interest which is levied again on us through the medium of 
 commerce. And they are so ready still to deal out their lia- 
 bilities to us, that they are now willing to let themselves run 
 in our debt ninety millions more, on our paying them the same 
 premium of 6 or 8 per cent, interest, and on the same legal ex- 
 emption from the payment of more than thirty millions of the 
 debt when it shall be called for. 
 
 "If the debt which the banking companies owe be a bless- 
 ing to anybody, it is to themselves alone, who are realizing a 
 solid interest of 8 or 10 per cent on it. As to the public, the 
 companies have banished all our gold and silver medium, 
 which before their institution we had without interest, instead 
 of which they have given us two hundred millions of froth and 
 bubble on which we are to pay them heavy interest. 
 
 "It is said that pur paper is as good as silver, because we 
 may have silver for it at the bank where it issues. This is not 
 true. One, two or three persons might have it, but a general 
 application would soon exhaust their vaults and leave a ruin- 
 ous proportion of their paper in its intrinsic worthless form. 
 
 "When I speak comparatively of the paper emission of the 
 old Congress and the present banks, let it not be imagined 
 that I cover them under the same mantle." 
 
 Other American statesmen whose memory we cherish 
 have left us a record of their expressions of hostility to banks 
 of issue. 
 
 Thomas H. Benton said: 
 
 "The government ought not to delegate this power if it 
 could. It is too great a power to be trusted to any banking 
 company whatever, or to any but the highest and most re- 
 sponsible government." 
 
 Ciay said: 
 
 "I conceive the establishment of this United States bank 
 as dangerous to the safety and welfare of the republic." 
 
 John Randolph said: 
 
 "Charter a bank with $35,000,000, let it establish and learn 
 its power, and then find, if you can, means to bell the cat." 
 
 John C. Calhoun said:
 
 70 A New Study of Political Economy. 
 
 "The bank is a union of the government and money 
 power a union far more dangerous than church and state." 
 
 James A. Garfield said: 
 
 "Whoever controls the volume of money in any country is 
 absolute master of all industry and commerce." 
 
 Our opponents lose no opportunity to ridicule our posi- 
 tion in opposition to banks of issue, and in favor of govern- 
 ment issue of money. But we may console ourselves that 
 Thomas Jefferson was also ridiculed for the same thing. In a 
 letter to President Adams, January 24, 1814, he wrote: 
 
 "I have ever opposed money of banks; not of those dis- 
 counting for cash, but of those fostering their own paper in 
 circulation, and thus banishing our cash. My zeal against 
 those institutions was so warm and open at the establishment 
 of the Bank of the United States that I was derided as a ma- 
 niac by the tribe of bank mongers who were seeking to filch 
 from the public." 
 
 If anything further were needed to show that our position 
 on this question is in accordance with time-honored Demo- 
 cratic principles, the following extract taken from President 
 Jackson's veto message to Congress, December 2, 1834, will be 
 sufficient: 
 
 "Circumstances make it my duty to call the attention of 
 Congress to the Bank of the United States. Created for the 
 convenience of the government, that institution has become 
 the scourge of the people. Its interference to postpone the 
 payment of a portion of the national debt that it might retain 
 the public money appropriated for that purpose to strengthen 
 it in a political contest, the extraordinary extension and con- 
 traction of its accommodations to the community, its corrupt 
 and partisan loans, its exclusion of the public directors from 
 a knowledge of its most important proceedings, the unlimited 
 authority conferred on the President to expend its fund in 
 hiring writers and procuring the execution of printing and 
 the use made of that authority, the retention of the pension 
 money and books after the selection of new agents, have 
 through various channels been laid before Congress. They 
 were substantially a confession that all the real distresses 
 which individuals and the country had endured for the pre- 
 ceding six or eight months have been needlessly produced by 
 it with the view of affecting, through the sufferings of the peo- 
 ple, the legislative action of Congress." 
 
 GOVERNMENT LOANS. 
 
 One of the great bugaboos in our platform is the declaia- 
 tion in favor of government loans. We are told that it is not 
 only impractical, but unconstitutional. It has become quite
 
 A New Study of Political Economy. 71 
 
 popular now to pronounce everything unconstitutional that 
 has for its object relief for the masses. The government may 
 loan to five individuals who will incorporate themselves into 
 a company under the name of a national bank, but it is a vio- 
 lation of the Constitution to loan to a farmer, who owns the 
 basis of all securities - land. The government has loaned mill- 
 ions of dollars to exposition and railroad companies with prac- 
 tically no security, and no one has been swift to denounce it as 
 unconstitutional. Government has loaned money to banks, 
 with and without interest. The government has loaned money 
 to the States, and States have loaned money to individuals, on 
 real estate security. The States of Missouri and Oregon loan 
 their school money to farmers on real estate security. For 
 years Eastern loan companies have proved the practicability 
 and safety of real estate loans by plastering the country over 
 with mortgages. Certainly the farmer can better pay 2 per 
 cent than 8 to 10 per cent. The amount saved in the dif- 
 ference of interest would pay the principal in fifteen years. 
 No man has ever been able to point out where or why it is un- 
 constitutional. It is not a new idea. The Massachusetts col- 
 ony issued money, and leaned to her people for a specified 
 term of years money to the amount of 115,000. After a trial 
 of this plan for four years every industry seemed to flourish 
 and thrive as never before. The colony then, in 1720, just four 
 years later, issued another loan, making in all money issued 
 and loaned to the people on real estate securities 222.000 or 
 $1,110,000. The same authority shows that other colonies fol- 
 lowed this same mode. 
 
 Russia makes land loans to her peasant farmers. The 
 Dominion of Canada recently made an experiment in that di- 
 rection with marked success. They made a long-time loan to 
 members of the Mennonite colony at a low rate of interest, and 
 every dollar of it was paid. Why should it be thought a thing 
 incredible and impractical to loan money on land when land is 
 considered the basis of all security? Let the nine millions of 
 mortgages that were placed on land from 1880 to 1890 at an 
 average rate of 6 3-5 per cent, answer the question. 
 
 Although Coxey's plan to issue money to build good roads, 
 and thereby not only increase the volume of currency, but 
 give employment to the idle, was ridiculed and scorned by 
 Congress, and Coxey himself put in jail ostensibly for carry- 
 ing a banner a size larger than a Columbian postage stamp, 
 and fined for walking on the grass, it is not generally known 
 that the road he traveled from Massillon, Ohio, to Washington, 
 was built by the national government and paid for out of na- 
 tional funds. The great national pike is an enduring monu- 
 ment of the idea which inspired Coxey and is in accord with
 
 72 A New Study of Political Economy. 
 
 that part of our platform. The improvement of the water- 
 ways is also exactly in line with this principle. There is noth- 
 ing impractical, nothing unconstitutional, or nothing new and 
 strange in this declaration. 
 
 FREE COINAGE. 
 
 The People's Party are in favor of free coinage of silver at 
 the ratio of 16 to 1 without waiting for the consent of any 
 other nation on earth. We favor this proposition because it 
 will increase the volume of currency in circulation and con- 
 tribute not only to make better prices for the products of la- 
 bor, but to break the power which the bankers now have to 
 control the currency. The People's Party is the only national 
 party that favors free and unlimited coinage of silver. It is 
 the only party that put an absolute free silver plank in its na- 
 tional platform. It is the only party that ran a free silver 
 candidate for President. It is the only party whose members 
 of Congress cast a solid and united vote for free silver when 
 the question came up in Congress. It is the only party that 
 will ever give this country free silver. 
 
 FIFTY DOLLARS PER CAPITA. 
 
 The People's Party has been charged with wanting to flood 
 the country with money. Our platform demands an increase 
 of the volume of currency to $50 per capita. It is now, accord- 
 ing to the report of the Secretary of the Treasury, about $24 
 per capita most of which is not in active circulation. France 
 has over $40 per capita in circulation, and this country di- 
 rectly after the late war, the most prosperous period in its his- 
 tory, had $50 per capita. The wildest "dreamer" or "infla- 
 tionist," as we are sometimes called, has not asked for more 
 than that. With our undeveloped resources and our immense 
 territory we think it not too much. 
 
 THE INCOME TAX. 
 
 We demand a graduated income tax. We believe that 
 those whose incomes reach up into the thousands should be 
 taxed on that income to help bear the burdens of government. 
 We believe that that tax should be made heavier as that in- 
 come increases, so that if a man's income was $1,000,000 the 
 government would get such a large slice of it in the way of an 
 income tax that he would wish he was something else besides 
 a millionaire. We are charged here with wanting to limit the 
 amount a man shall make. We don't want to do any such 
 thing, but we do want to limit the amount he steals. In 1863
 
 A New Study of Political Economy. 73 
 
 there was a law passed creating a tax on incomes. It expired 
 by limitation in 1871. During that time there were collected 
 under that law the following amounts: 
 
 From personal incomes $264.190,863 
 
 From corporations 68,250,504 
 
 From salaries of United States officers and em- 
 ployes 13,889,604 
 
 Total amount collected $347,220,897 
 
 The Senate sugar tariff bill contains an income tax in a 
 modified form very much modified. 
 
 ECONOMY. 
 
 The People's Party believes in economy. Our platform 
 declares: 
 
 "We believe that the money of the country should be kept 
 as much as possible in the hands of the people, and hence we 
 demand that all State and national revenues shall be limited 
 to the necessary expenses of the government, economically and 
 honestly administered." 
 
 The only objection we have ever known to that plank is 
 in the practices of the leaders of the two old parties. 
 
 POSTAL SAVINGS BANKS. 
 
 "We demand that postal savings banks be established by 
 the government for the safe deposit of the earnings of the peo- 
 ple and to facilitate exchange." 
 
 This has been recommended by various postmasters-gen- 
 eral. The Dominion of Canada, in 1867, passed an act creating 
 post-office banks, but it was limited to the provinces of Ontario 
 and Quebec, and on" September 1, 1885, was extended to the 
 provinces of Nova Scotia and New Brunswick. There were 
 494 offices in 1890. On June 30, 1890, these banks reported 
 112.321 depositors, with total deposits amounting to $21,900,- 
 653, an increase of nearly 819,000,000 in ten years. There were 
 also government banks established in the Maritime Provinces 
 and in Manitoba and British Columbia, with forty-one 
 branches, but are being merged into post-office savings banks. 
 Rate of interest paid is 3% per cent. 
 
 The bank failures of 1893 have made many advocates of 
 postal savings banks. Such banks would make panics impos- 
 sible. 
 
 The Transportation Problem. 
 
 The People's Party is in favor of government ownership of
 
 7i A New Study of Political Economy. 
 
 railways. On this question our platform declares as follows: 
 
 "We believe that the time has come when the rahroad 
 corporations will either own the people or the people must own 
 the railroads; and should the government enter upon tne work 
 of owning and managing any or all railroads, we should favor 
 an amendment to the Constitution by which all persons en- 
 gaged in the government service shall be placed under a civil 
 service regulation of the most rigid character, so as to prevent 
 the increase of the power of the national administration by the 
 use of such additional government employes. 
 
 "Transportation being a means of exchange, and a public 
 necessity, the government should own and operate ine rail- 
 roads in the interest of the people." 
 
 We are aware that in the treatment of this subject we are 
 treading on grounds that are hotly contested. We have no 
 hesitation in approaching it. Many people are foolish enough 
 to believe that government ownership is a new fantastical idea 
 that originated within the chimerical brain of some crazy 
 Populist. The idea of government ownership is as old as the 
 invention of railroads. Among the governments now owning 
 and operating their own lines, together with the number of 
 miles they are operating, are the following: Germany, 23,843; 
 Austria-Hungary, 7,800; Belgium, 3,000; Italy, 8,110; Portugal, 
 600; Denmark, 963; Norway, 700; Roumania, 1,900; Russia, 
 6,824; British India, 8,423; Japan, 710; Egypt, 1,200; the Cape 
 Colony, 1,974; Port Natal, 399; New South Wales, 2,182; Vic- 
 toria, 2,688; Tasmania, 1,900; New Zealand, 1,824; South Aus- 
 tralia, 1,752; Queensland, 2,058; West Australia, 496; Chile, 682; 
 Argentine, 1,817; Brazil, 1,568. 
 
 These figures are taken from statistical reports ranging 
 from the year 1888 to 1892. In addition to these the Dominion 
 of Canada owns and operates four railways, the cost of which 
 up to June 30, 1890, was 52,800,000. Besides this, the govern- 
 ment exercises the strictest central over the roads owned by 
 corporations. 
 
 In South America most of the governments own and oper- 
 ate a portion or all of their railroads. The Republic of Ecua- 
 dor, in 1889, owned and operated most of her railroads. The 
 total number of miles opera ted in Chile, in 1887, was 1,674, of 
 which 682 were owned by the state. The Argentine Republic, 
 in 1887, owned and operated 1,148 miles of railroad; Buenos 
 Ayres, 572, and the Province of Santa Fe, 102 miles. Brazil 
 owns and operates 1,200 miles of railroad, which yields a net 
 income of 3 per cent on the capital invested. Germany, per- 
 haps, owns and operates more miles of railroad than any other 
 nation. The total number of miles in operation in that coun- 
 try, in 1891, was 43,000 kilometres, or nearly 27,000 miles. Of
 
 A New Study of Political Economy. 75 
 
 these roads the government owned and operated 38,250 kilo- 
 metres, or more than 23,000 miles. The Annual of 1889 con- 
 tains the statement that the roads had turned into the public 
 treasury 1,006,262,000 marks, or about $250,000,000, with which 
 about 4,000 miles of new road had been constructed, with quite 
 a good sum left unexpended. 
 
 Ex-Governor William Larrabee in his excellent work, 
 "The Railroad Question," which is recognized as a standard 
 book on the subject, and from which we have quoted largely, 
 says: 
 
 "No one can contradict the following facts, viz.: That the 
 average cost of European roads is much greater than that of 
 American roads; that the number of railroad employes per 
 mile is much greater than here; that much larger sums are 
 expended for repairing and improving the roads, and- that, 
 therefore, the lives of passengers are much safer in Europe 
 than in America, and that the average speed and eorrespoud- 
 ing accommodations of European trains, and especially those 
 of England, France and Austria-Hungary, compare quite fav- 
 orably with the average speed and corresponding accommo- 
 dations of our roads. It is, under these circumstances, absurd 
 to claim that the higher prices charged by American roads 
 are due to the greater cost of service." 
 
 Governor Larrabee quotes from Arthur T. Hadley, "Rail- 
 road Transportation, Its History and Its LawV this state- 
 ment: 
 
 "The importance of the zone system in Austria and in 
 Hungary lies in the fact that its adoption was accompanied by 
 a great reduction in rates. The unit rate for slow third-class 
 trains, which had previously been nearly 1^ cents per mile, 
 was reduced to less than 1 cent." 
 
 Speaking of the effect of this reduction of rates, Mr. Lar- 
 rabee says: 
 
 "The zone system recently adopted in Hungary reduced 
 both the passenger and freight rates of the government roads 
 at least one-third, and this reduction has, contrary to expecta- 
 tions, greatly increased their net revenues." 
 
 In summarizing the results of government ownership in 
 European countries, Mr. Larrabee says: 
 
 "For the past fifteen years there has been a decided 
 drift on the European continent toward state ownership of 
 railroads." 
 
 The principle upon which the demand for government 
 ownership rests, is that railroads are public highways, neces- 
 sary to the public welfare and convenience, the same as our 
 public roads and waterways, and as forming too important a
 
 76 A New Study of Political Economy. 
 
 factor in the commerce and exchange of the country to be left 
 to the whims and caprices of individuals. 
 
 TELEGRAPH AND TELEPHONE LINKS. 
 
 On the subject of telegraphs and telephones our platform 
 contains the following declaration: 
 
 "The telegraph and the telephone, like the post-office sys- 
 tem, being a necessity for the transmission of news, should be 
 owned and operated by the government in the interest of the 
 people." 
 
 One of the greatest monopolies in the land is the Western 
 Union Telegraph Company. Its exactions on the people are 
 without a parallel. It controls not only the quantity of news 
 furnished our great metropolitan papers, but the quality. 
 Starting in 1858 with a capital of $358,700, it declared "stock 
 dividends" in eight years of $17,810,146. It then added nearly 
 t womillion dollars for new lines, making its capital $20,000,- 
 000. The next year it added $20,000,000 of watered stock, 
 which increased its capital to $40,000,000. At present it is 
 $100,000,000. Its annual average profits for the period of 
 thirty-four years have been 300 per cent., its largest dividend 
 reaching 414 per cent. Every $1,000 invested in 1858 has paid 
 $58,000 in stock dividends and $100,000 cash. If the govern- 
 ment would buy it the net profits would create a sinking fund 
 that would pay for the entire system in ten years, after which 
 prices could be reduced to less than one-third of the present 
 rates. England and France own their telegraph lines, and 
 while the rates are less than hah* what they are in this coun- 
 try, the lines pay a net revenue, above all expenses, into the 
 public treasury. A recent number of the Arena contains an 
 excellent article by Justice Clark, of the Supreme Court of 
 North Carolina, showing from a judicial standpoint that Con- 
 gress would not only be justified, but that it is under legal and 
 moral obligation under the Constitution to give the people the 
 best and speediest postal facilities such as the telegraph af- 
 fords. 
 
 Land. 
 
 Land is the source of all human subsistence. The earth 
 provides for every human want. On this question our plat- 
 form makes the following declaration: 
 
 "The land, including all the natural sources of wealth, is 
 the heritage of all the people, and should not be monopolized 
 for speculative purposes, atn^hsrien ownership of land should 
 be prohibited. All lands now held by railroads and other cor- 
 porations, in excess of their actual needs, and all lands now
 
 A New Study of Political Economy. 77 
 
 owned by aliens, should be reclaimed by the government and 
 held for actual settlers only." 
 
 As the land is the source from which all human necessi- 
 ties are supplied, we believe that no man has a right to more 
 than he needs for his own use while others are homeless and 
 suffering for that which it can be made to produce. Property 
 rights must always give way to human rights. Private rights 
 must be subordinate to the public welfare. Predicated on the 
 grand principle of greatest good to the greatest number, we 
 have made this declaration on land. 
 
 Our Condition. 
 
 Having thus briefly discussed the principles embodied in 
 our platform, it now devolves upon us to point out a remedy 
 for existing evils. Before doing this, however, it becomes nec- 
 essary for us to understand our condition and the causes 
 which have led to it. To this end I could do no better than to 
 first call your attention to the preamble of our platform 
 adopted at Omaha, July 4, 1892. Let every man read that 
 document. It foretells with unerring truth the disasters 
 which have recently overwhelmed us. In the light of these 
 events it reads like a prophecy. Millions of men and women 
 are out of employment, and soon the cold blasts of winter will 
 witness such suffering and privation as was never before known 
 in this country. Silver has been demonetized and the banks 
 clothed with a power over our currency and over the business 
 of the country that endangers our liberties and our prosperity. 
 In twenty-one years, from 1871 to 1892, the people paid to the 
 railroad companies the enormous sum of $16,004,537,112. The 
 assessed value of all the property in the United States in the 
 year 1880 was $16,902,993,543. In other words, we have paid 
 to the railroad companies, in twenty-one years, a sum almost 
 equal to the assessed value of all taxable property for the year 
 1880. Add to this the immense sum of interest we have paid 
 to creditors, the extortions of trusts and combines, and is it 
 any wonder that we are struggling in the throes of a debt of 
 $32,000,000,000? Never before in the history of the world were 
 such fabulous fortunes made in such incredibly short tune. 
 No country possesses so many millionaires, and at the rate we 
 are traveling, in a few years no country will possess so many 
 paupers. 
 
 The following, from the New York Recorder, shows an ap- 
 proximate distribution of our wealth: 
 
 "According to figures from reliable sources, there were in 
 the United States, in 1891, 13,000,000 families, with an assessed 
 wealth of $62,082,000,000, of which there were:
 
 78 A New Study of Political Economy. 
 
 70 families worth 82.625,000,000 
 
 90 families worth 1,025,000,000 
 
 100 families worth 1,440,000,000 
 
 135 families worth 968,000,000 
 
 360 families worth 1,650,000,000 
 
 1,753 families worth 4,036,000,000 
 
 6,000 families worth 7,500,000,000 
 
 7,000 families worth 4,550,000,000 
 
 11,000 families worth 4,125,000,000 
 
 14,000 families worth 3,220,000,000 
 
 16,500 families worth 2,722,000,000 
 
 30,000 families worth 5,000,000,000 
 
 75,000 families worth 4,500,000,000 
 
 200,000 families worth 4,000,000,000 
 
 1,000,000 families worth 3,500,000,000 
 
 2,000,000 families worth 4,000,000,000 
 
 9,620,000 families worth 7,215,000,000 
 
 "These figures show that 40,000 persons own over one-half 
 of the wealth of the United States, while one-sixtieth part of 
 our people own over two-thirds of the entire wealth of the 
 country; and that 250,000 persons own 75 per cent, of the 
 United States. These tables also show that three-fourths of 
 our families are not worth over $600 to the family, while one- 
 fourth are worth over 814,000 to the family, It will also ap- 
 pear by a small calculation that one-half of these families are 
 worth less than $200 to the family. 
 
 "Again, while 25,000 families have an aggregate yearly in- 
 come of not less than $2,500,000,000 per year, or $100,000 as an 
 average, there are, according to Edward Atkinson's estimate, 
 not less than 11,000,000 families (estimated at five to the fam- 
 ily) who have an income which does not exceed 1450 per year, 
 and hardly averages $350. Atkinson further estimates that 
 only 700,000 families have an income between $450 and $1,000 a 
 year, and only 300,000 have more than $1,000 yearly income. 
 Take his highest figures and you will have: 
 
 Families. Av. Income. Total. 
 
 11,000,000 $ 350 $3,850,000,000 
 
 700,000 700 490,000,000 
 
 300,000 5,000 1,500,000,000 
 
 25,000 100,000 2,500,000,000 
 
 Which proves. that about 325,000 families have as much income 
 as 11,700,000 families, and that it is almost impossible for the 
 poorer classes to accumulate any wealth whatever." 
 
 A recent number of the Quarterly Journal of Economics 
 gives the following statistics of the number of laborers out of
 
 A New Study of Political Economy. 79 
 
 employment in some of our prominent cities: Boston, 10,000; 
 Worcester, 7,000; New Haven, 5,000; Providence, 9,000; New 
 York, 100,000; Utica, 16,000; Newark, 19,000; Philadelphia, 75,- 
 000; Baltimore, 10,000; Wheeling, 3,000; Cincinnati, 6,000; 
 Cleveland, 8,000; Columbus, 4,000; Indianapolis, 5,000; Chicago, 
 200,000; Detroit, 25,000; Milwaukee, 20,000; Grand Rapids, 
 6,000; Minneapolis, 6,000; St. Louis, 80,000; St. Joseph, 2,000: 
 Omaha, 2,000; Butte City, Mon., 5,000; San Francisco, 15,000; 
 Total, 638,000. 
 
 This is only a partial list. It is compiled from reports of 
 mayors, chiefs of police and charity organizations, and is, no 
 doubt, approximately correct. It is safe to assume that 2,000,- 
 000 men and women are out of employment, which means hun- 
 ger and privation for at least three times that many more who 
 are dependent on them. Well may every true American ex- 
 claim: "Whither are we drifting?" Wealth concentrating in 
 the hands of a few, and the people losing their lands and 
 homes! 
 
 The Remedy. 
 
 Daniel Webster, the great constitutional lawyer, said: 
 
 "The freest government cannot long endure where the 
 tendency of the law is to create a rapid accumulation of prop- 
 erty in the hands of the few, and to render the masses of the 
 people poorer and dependent." 
 
 We are the victims of class legislation. We are a nation 
 of debt slaves. There is no time to stop and quibble and quar- 
 rel over the question as to who is responsible for the class 
 legislation that has made such unequal distribution of wealth 
 possible. The remedy offered by the People's Party is to re- 
 verse the legislation of the past, and throw out safeguards to 
 protect the people of the future. The people must be aided to 
 pay their debts or forever remain in industrial or debt slavery. 
 And, if we follow the teachings of Jefferson, it must be done 
 quickly, as we have no right to entail this debt on the future 
 generation. Speaking directly upon this question, vol. 3, page 
 103, Jefferson's Works, he says: 
 
 "The question whether one generation of men has a right 
 to bind another seems never to have been started, yet it is a 
 question of such consequence as not only to merit decision, but 
 place, among the fundamental principles of every government. 
 That no such obligation can be transmitted I think capable of 
 proof." 
 
 What, then, is the remedy proposed by the People's Party? 
 
 To return at once to the fundamental principles of gov- 
 ernment.
 
 80 A New Study of Political Economy. 
 
 Abolish banks of issue and let the government issue ita 
 own money. 
 
 Wipe out all monopolies, one after another, so that they 
 can make no further exactions from the people. 
 
 When this is done and the people have an opportunity 
 they will soon discharge their indebtedness. 
 
 We have already pointed out the evils resulting from 
 banks of issue. We have it from the best authority that the 
 recent panic was precipitated by the banks. The silver con- 
 vention held at Chicago, composed of men of all political 
 parties, declared: 
 
 "The distrust is not of the government or its money, but 
 of the banks, which have, as we believe, precipitated the pres- 
 ent panic on the country in an ill-advised effort to control the 
 action of Congress on the silver question and the issue of 
 bonds." 
 
 Col. Robert G. Ingersoll said: 
 
 "This is a bankers' panic. The bankers have been pre- 
 dicting a panic for years and have done all they could to ful- 
 fill their prediction. They tell us that the Sherman law^has 
 done all the damage, and they point to the present price of 
 silver as one of the results of the Sherman law. Certainly 
 silver did not fall in price because the Sherman bill ma de a 
 market for 4,500,000 ounces a month. You cannot put down 
 prices by buying. Silver has fallen because it has been de- 
 monetized. The value of a thing depends somewhat upon its 
 uses, and the main use of silver has been destroyed. Suppose 
 gold had been demonetized instead of silver, what would gold 
 be worth?" 
 
 Senator Hill, of New York, arraigned the bankers of the 
 East in language as follows: 
 
 "With ghoulish glee they welcomed every bank failure, 
 especially in the silver States, little dreaming that such fail- 
 ures would soon occur at their own doors. They encouraged 
 the hoarding of money; they inaugurated the policy of refus- 
 ing loans to the people, even upon the best security; they cir- 
 culated false petitions, passed absurd and alarming resolutions ; 
 predicted the direst disaster, attacked the credit of the gov- 
 ernment, sought to exact a premium upon currency, and at- 
 tempted in every way to spread distrust broadcast throughout 
 the land. The best financial system in the world could not 
 stand such an organized and vicious attack upon it. These 
 disturbers these promoters of the public peril represent 
 largely the creditor class, the men who desire to appreciate the 
 gold dollar in order to subserve their own selfish interests, 
 men who revel in hard times, men who drive harsh bargains 
 with their fellow-men in periods of financial distress, and men
 
 A New Study of Political Economy. 81 
 
 wholly unfamiliar with the true principles of monetary 
 science." 
 
 Again we say, abolish the banks of issue. 
 
 Debts are payable only in money. Money can only be ob- 
 tained by parting with labor or the products of labor, unless 
 we steal it, or have it given to us. 
 
 When money is scarce it takes more labor or more prop- 
 erty to obtain it. Hence the great crime of the demonetiza- 
 tion of silver. It has practically doubled the burden of debt. 
 Prices have been going down and will continue to go down un- 
 less this conspiracy to enslave labor is broken. 
 
 Let the government remonetize silver at once. Let that 
 be supplemented by an issue of paper money sufficient to in- 
 crease the volume to 850 per capita. We are told that paper 
 money itsued by the government would be worthless unless 
 based on gold, or at least on gold and silver. Again we resort 
 to Thomas Jefferson for our authority. In his letter to John 
 W. Epps, dated June 24, 1813, which can be found in Jeffer- 
 son's Works, vol. 6, pages 139, 140, Mr. Jefferson says: 
 
 "And so the nation may continue to issue its bills as far as 
 its wants require and the limits of its circulation will admit. 
 Those limits understood to extend with us at present to $200,- 
 000,000, a greater sum than would be necessary for any war. 
 But this, the only resource which the government could com- 
 mand with certainty, the States have, unfortunately, fooled 
 away, nay, corruptly alienated to swindlers and shavers, under 
 the cover of private banks. Say, too, as an additional evil, 
 that the disposable funds of individuals to this great amount 
 have thus been withdrawn from improvement and useful en- 
 terprise, and employed in the useless, usurious and demoraliz- 
 ing practices of bank directors and their accomplices. In the 
 war of 1755 our State availed itself of this fund by issuing a 
 paper money bottomed on a specific tax for its redemption, 
 and to insure its credit, bearing an interest of five per cent. 
 Within a very short time not a bill of this emission was to be 
 found in circulation. It was locked up in the chests of execu- 
 tors, guardians, widows, farmers, etc. We then issued bills 
 bottomed on a redeeming tax, but bearing no interest. These 
 were readily received, never depreciated a single farthing." 
 
 Again, in a letter dated September 11, 1813, he says: 
 
 "Bank paper must be suppressed, and the circulating 
 medium must be restored to the nation to whom it belongs. 
 It is the only fund on which they can rely for loans: it is the 
 only recourse that can never fail them, and it is an abundant 
 one for every necessary purpose. Treasury bills bottomed on 
 taxes, as may be found necessary, thrown into circulation, will 
 take the place of so much gold and silver."
 
 82 A New Study of Political Economy. 
 
 John C. Calhoun, one of the most brilliant statesmen of 
 the South, in a speech in the United States Senate, said: 
 
 "Bank paper is cheap to those who make it, but very 
 dear to those who use it . On the other hand, national cur- 
 rency, while it would greatly facilitate its financial operations, 
 would cost next to nothing, but would give to every branch of 
 industry great advantages. And now I undertake to affirm, 
 without the fear that I can be answered, that a paper 
 issued by the government with a single promise to receive it 
 for dues, would form a perfect paper circulation, which could 
 not be abused by the government; that it would be as uniform 
 in value as metals, and I shall be able to prove that it is 
 within the Constitution and power of Congress to provide such 
 a paper, according to the most rigid rule of construing the 
 Coonstitution. 
 
 If anything was wanting to prove that the government 
 had the power to issue paper money when money was needed, 
 the following decision of the United States Supreme Court is 
 sufficient. The court says: 
 
 "There are times when the exigencies of the state rightly 
 absorb all subordinate considerations of private interest, con- 
 venience, or feeling; and at such times the temporary though 
 compulsory acceptance by a private individual of the govern- 
 ment credit, in lieu of the debtor's obligation to pay, is one of 
 the slightest forms in which the necessary burdens of society 
 can be sustained. 
 
 "When the ordinary currency disappears, as it often does 
 in time of war, when business begins to stagnate and general 
 bankruptcy is imminent, then the government must have 
 power at the same time to renovate its own resources and to 
 revive the drooping energies of the nation BY SUPPLYING 
 IT WITH A CIRCULATING MEDIUM. What that me- 
 dium shall be, what its character and qualities, will depend 
 upon the greatness of the exigency and the degree of prompt- 
 itude which it demands. THESE ARE LEGISLATIVE 
 QUESTIONS. The heart of the nation must not be crushed 
 out. The people must be aided to pay their debts and meet 
 their obligations. The debtor interest of the country repre- 
 sents its bone and sinew, and must be encouraged to pursue 
 its avocations. If relief were not afforded, universal bank- 
 ruptcy would ensue, and industry would be stopped, and gov- 
 ernment would be paralyzed in the paralysis of the people." 
 12 Wallace, 464, 465. 
 
 Now with regard to the $50 per capita. In Jefferson's 
 letter to Mr. Epps, June 24, 1813, he stated that the limit of 
 circulation for treasury notes bottomed on taxes was conceded 
 to be $200,000,000. At that time the population of the United
 
 A New Study of Political Economy. 83 
 
 States was eight millions. We have now eight times the 
 population and might with the same degree of safety issue 
 eight times as many treasury notes bottomed on taxes, 
 which would amount to $1,600,000,000 in addition to our 
 present currency. This would make in all about $3,300,000,- 
 000 of currency, or a fraction over 50 per capita. 
 
 We are not left to conjecture what the effects would be. 
 As soon as government assumes absolute control of the 
 currency confidence will be restored, money will come from its 
 hiding-place and seek investment in industrial enterprises; 
 the idle will be given employment; prices will advance and 
 people be given an opportmnity to pay their debts and become 
 free. We have already indicated h'ow this money may be 
 placed in circulation. Loan it direct to the people; buy or 
 build railroads^ and pay it out in the ordinary expenses of the 
 government. Loans to the people on real estate can be made 
 either through the system of postal savings banks which our 
 platform calls for, or by the general government loaning it to 
 the States and the States loaning it to individuals under strict 
 and absolutely safe regulations. We are asked, how would 
 this help the man who has no real estate? We answer by 
 asking how does the free coinage of silver help the man who 
 has no silver? It helps every man by increasing the price of 
 the products of his labor and making it easier for him to 
 pay his debts. He is benefited in the general prosperity 
 which would follow a full and sufficient circulating medium. 
 
 "If the whole money in circulation was doubled, prices 
 would double. If it was only increased one-fourth, prices 
 would rise one-fourth." 
 
 Amasa Walker, in his "Science of Wealth," page 221, says : 
 
 "Other things equal, the general average of prices is 
 determined by the quantity of currency in circulation, and 
 prices advance or recede as that is increased or diminished. 
 The general price of all objects of value will ever depend 
 upon the quantity of currency existing in the country in 
 which they are produced and sold. This is an economic law 
 as certain as any of the laws of nature." 
 
 Ricardo says : 
 
 "There can exist no depreciation in money but from 
 excess ; however debased a coinage may become, it will pre- 
 serve its mint value ; that is to say, it will pass in circulation 
 for the (so-called) intrinsic value of the bullion which it ought 
 to contain, provided it be not in too great abundance." 
 
 David Hume, the historian, says : 
 
 "It is not difficult to perceive that it is the total quantity 
 of the money in circulation in any country which determines 
 what portion of that quantity shall exchange for a certain
 
 84 A New Study of Political Economy. 
 
 portion of the goods or commodities of that country. It is 
 the proportion between the circulating money and the com- 
 modities in the market which determines the price." 
 
 We might quote hundreds of authorities in support of our 
 position, but we deem it unnecessary. It will be readily seen 
 that the power that controls the money of the country controls 
 prices. It is for this reason that the banks have sought con- 
 trol of the currency. The contest is between the people and the 
 banks. With $32,000,000,000 of indebtedness which has been 
 forced upon the people by a decreasing volume of money in 
 circulation, with silver demonetized, and gold made the only 
 medium of payment, with the banks owning the bonds, notes 
 and mortgages, and the gold, the condition of our people is 
 hopeless, except through the way indicated by the People's 
 Party. On every hand there is work to be done. New re- 
 sources are to be developed. Millions of dollars of wealth 
 await the vitalizing hand of industry. But there is no money 
 to infuse life into the arteries of industry. Those who have 
 money refuse to invest it when all kinds of property is falling 
 in value. The bankers have got a corner on money. They 
 seek to increase its value by making it scarce. Let the gov- 
 ernment begin the issue of money, and it will break this 
 corner. _ Instead of that the government has assisted the 
 bankers in their conspiracy by striking down silver and making 
 money scarcer. The majority of the representatives in Con- 
 gress, of both political parties, have helped to do this thing. 
 It is a question for the people to settle, whether they will 
 longer support political parties who foster a system of debt 
 slavery which the money power seeks to make perpetual. 
 We are told that if you raise the prices on what you have to 
 sell it will not benefit you, because you will have to pay pro- 
 portionately higher prices for what you buy. This is only 
 true of those who expect to spend as much as they make 
 who have no surplus. But to the industrious man who seeks 
 to lay by something for a rainy day, or who is in debt, it is 
 quite different. Some time since a Mr. W. R. Miller had pub- 
 lished the contents of a leaf taken from the ledger of Burns & 
 Marshall, a firm that did business in the town of Smithville, 
 Ark., in 1866. It was published in the Commonwealth, and 
 the high price commented on. Here is the clipping from the 
 Commonwealth: 
 
 "W. R. Miller left us a leaf taken from an old ledger of 
 Burns & Marshall, who did business in Smithville in 1866. 
 From it we take the following items as charged on Christmas 
 day of that yaer: 1 Ib. tobacco, SI; 1 lb. sugar, 25 cents; 1 
 quart coal oil, 40 cents; 3 yards calico at 35 cents a yard, 1.05; 
 1 quart whisky, $1.25; bottle to put it in, 15 cents; 1 lb. gun-
 
 A New Study of Political Economy. 85 
 
 powder, $1; 1 Ib. shot, 30 cents; 1 yard bed ticking, 80 cents; 1 
 paper pins, 20 cents; 2 yards gingham, $1.50; 1 pair suspenders, 
 il.25; 1 box collars, 40 cents. Compare the prices of what peo- 
 ple had to pay for goods in the palmy days of '66 with the 
 price for what you have to pay our merchants of the present 
 day, and there is quite a difference. Mr. Miller keeps the page 
 as a relic." 
 
 Now let us take these figures as a basis for our calcula- 
 tion, and make a comparison between then and now. 
 
 PRICES 1866. 
 
 2 Ib. tobacco, $1 Ib 8 2 00 
 
 10 Ib. sugar, 25c. Ib 2 50 
 
 1 gal. coal oil 1 60 
 
 lO.yards calico, 35c. yard 3 50 
 
 1 gal. whisky 5 00 
 
 1 jug 50 
 
 1 Ib. gunpowder 1 00 
 
 3 Ib. shot, 30c. Ib 90 
 
 8 yards bed ticking, 80c. yard 6 40 
 
 1 paper pins 20 
 
 10 yards gingham, 75c. yard 7 50 
 
 I pair suspenders 1 25 
 
 1 box paper collars 40 
 
 Total.. $3295 
 
 Cash.. $17705 
 
 Total $210 00 
 
 CREDIT. 
 
 1 bale cotton, 500 Ib., 42c. Ib $210 00 
 
 We want W. R. Miller to examine these figures well. In 
 1866 the highest for cotton was 52 cents, and the lowest 32 
 cents; average, 42 cents. The goods named are far above the 
 customary prices for that year. Yet the farmer had $177.25 to 
 carry home with him. Now, let us look at present prices of 
 the same articles in this year of 1895. 
 
 PRICES 1895. 
 
 2 Ibs. tobacco, 50c. Ib $ 1 00 
 
 10 Ibs. sugar 50 
 
 1 gal. coal oil 10 
 
 10 yds. calico 80 
 
 1 gal. whisky and jug 3 00 
 
 1 Ib. gunpowder 40
 
 86 A New Study of Political Economy. 
 
 3 Ibs. shot 25 
 
 8 yds. ticking 25c. yard 2 00 
 
 1 paper pins 05 
 
 10 yds. gingham, lOc. yard 1 00 
 
 1 pair suspenders. .' 25 
 
 1 box paper collars 10 
 
 Total $ 945 
 
 Cash 15 55 
 
 Total S 25 00 
 
 CREDIT. 
 
 1 bale cotton, 500 Ibs. 5c. Ib $ 25 00 
 
 Leaving the farmer $15 55 to take home with him in 1894, 
 against 177.05 in 1866, a difference in favor of 1866 of $161.50, 
 and this $161.50 in greenbacks paid $161.50 of debt just the 
 same as it does to-day. 
 
 The study of such prices as quoted by W. R. Miller is 
 what makes Populists. If non-office-holding Democrats and 
 Republicans will study plain facts and compare the times now 
 with those of 1866 they will all be Populists, and the Demo- 
 cratic and Republican parties will be reduced at once to only 
 the office-holders. 
 
 Having assumed control of the currency, and adopted a 
 system of finance in the interests of the great masses, let the 
 government then proceed to throw out the safeguards indi- 
 cated in our platform for the future protection of the rights of 
 the people. 
 
 Let it abolish every trust in the land. 
 
 Let it institute postal savings banks. 
 
 Let it pass a law providing a graduated income tax that 
 will forever in the future prevent the accumulation of such 
 immense fortunes. Let it provide also a graduated tax on 
 lands, over and above what is legitimately used by the owner, 
 so that there will be no fortunes made in land speculation 
 while thousands go without a home. 
 
 Let it gradually buy up the railroads, telegraphs and tele- 
 phones, at prices commensurate with the present cost of con- 
 struction, and if the companies do not want to sell at those 
 figures, then let the government begin the construction of 
 lines where most needed. The government ownership of one- 
 fourth the railroads in the United States would result in a 
 great reduction of rates. Having given you our remedy, we
 
 A New Study of Political Economy. 87 
 
 will now proceed to discuss some of the objections urged 
 against our party and its measures. 
 
 "THERE CAN BE BUT Two PARTIES." 
 
 We are told that there can be but two parties. We are not 
 going to deny the truth of this assertion, but we do insist on 
 being one of the two, and from the way in which the leaders of 
 the two old parties are voting together in Congress, it is now 
 plain to everybody that they are going to marry and will con- 
 stitute the other party. 
 
 Nothing is plainer than that there can be only two sides 
 to a question, but it does not follow that two parties may not 
 take the same side. The People's Party is on one side of the 
 great questions of the day. The two old parties are on the 
 other. It is our honest opinion that the wedding of these two 
 parties should take place soon if they would save themselves 
 from disgrace. It is strongly suspected that they have been 
 sleeping together in the same political bed. We see no reason 
 for a postponement of the marriage. They are both of the 
 same political faith. Grover Cleveland stands ready to give 
 the bride away, and John Sherman is willing to perform the 
 ceremony. Let the marriage take place and the offspring be 
 legitimatized. 
 
 FIAT MONEY. 
 
 We are charged with wanting to flood the country with 
 fiat money. If the same amount of money per capita we had 
 after the war, and which Thomas Jefferson concedes as proper, 
 in his letter to Mr. Epps, is "flooding the country," we plead 
 guilty to the charge. 
 
 We plead guilty to the charge of "fiat." We will agree to 
 eat any kind of a dollar which may be brought to us that is 
 not fiat. The "fiat fools" are those who don't know that 
 money that is not fiat is not money at all. A silver dollar is 
 worth 100 cents, and will buy as much as a gold dollar because 
 it is fiat. Take the fiat of the law from it and it is worth only 
 48 cents. 
 
 Occasionally we are told that the government can't issue 
 paper money unless it has the gold and silver back of it. This 
 is the parrot-like repetition of what the bankers say. That is 
 what they said during the last war. -But the government did 
 issue over seventeen hundred millions of it. If the govern- 
 ment has power to issue it to pay men to shoot other men 
 down, why has it not power to issue it to pay men who are 
 idle and suffering for the necessities of life, to construct pub- 
 lic works? If it can be issued for the purpose of destroying
 
 88 A New Study of Political Economy. 
 
 life, why can it not be issued to preserve life? If it can issue it 
 for the purpose of putting down chattel slavery, why can it 
 not issue it for the purpose of wiping put debt slavery? The 
 hypocritical cry that it can't do so has its origin in hell. 
 
 BUYING THE RAILROADS. 
 
 It is amusing to see our opponents construct straw houses, 
 and then proceed to demolish them. It is like the action of 
 school-boys madly charging a mullen stock, except that the 
 mullen stock is a more tangible object than our opponents 
 usually conjure up in their imagination. 
 
 These elegant gentlemen, the politicians, who are so de- 
 voted to the dear people's interests as to be willing to make 
 the great sacrifice of accepting office at salaries ranging 
 from $500 to $5,000 a year, take particular delight in supposing. 
 In their fertile imaginations they suppose a plan, charge it up 
 to the Populists, and then jump onto it and demolish it. Of 
 course they take great care to suppose a plan that is weak 
 enough in its structure for them to demolish. Some of these 
 conjurations are as silly as the supposition that we are in favor 
 of shoeing horses' tails. 
 
 The People's Party declares in favor of government owner- 
 ship of railroads and telegraph lines. But nowhere in its 
 platform does it indicate a plan to secure this end. If our op- 
 ponents are disposed to act fair why not concede that we 
 favor some practical plan for carrying out our declaration? 
 Why charge that we are in favor of purchasing all the rail- 
 roads at once at their capitalized value, including the watered 
 stock, and issuing bonds for the amount and taxing the peo- 
 ple to pay the bonds? No Populist has ever proposed any 
 such thing. There is no necessity for doing any such thing. 
 The railroads could be bought and paid for within twenty 
 years out of their net earnings and savings without taxing the 
 people one cent, or increasing the present rates of freight and 
 passenger tariff. But the people are already taxed on every 
 dollar of capital represented by railroad bonds and stocks to 
 the extent of ten thousand million dollars. They are taxed in 
 the freight and passenger rates which they have to pay the 
 railroad companies. What the People's Party desires is that 
 the money which now goes to pay dividends on stock and in- 
 terest on bonds, shall go towards purchasing the railroads and 
 eventually owning and operating them at greatly reduced 
 rates. In an able and well written article in the Arena, Mr. 
 C. Wood Davis, a practical railroad man and reliable statisti- 
 cian, figures the actual savings by government ownership of 
 railroads as follows:
 
 A New Study of Political Economy. 89 
 
 Savings from consolidation of depots and staffs 8 20,000,000 
 
 Savings from exclusive use of shortest route 25,000,000 
 
 Savings in attorneys' salaries and legal expenses. . . 12,000,000 
 
 Savings from abrogation of the pass evil 30,000,000 
 
 Savings from abrogation of commission system 20,000,000 
 
 Savings from dispensing with high-priced officers 
 
 and staffs 4,000,000 
 
 Savings by disbanding traffic associations 4,000,000 
 
 Savings by dispensing with presidents, etc 25,000,000 
 
 Savings by abolishing (all but local) officers, solic- 
 itors, etc 15,000,000 
 
 Savings of five-sevenths of advertising accounts. . . 5,000,000 
 
 Total $160,000,000 
 
 In addition to this there would be saved: 
 
 The annual political corruption fund $ 30,000,000 
 
 Secret rebates to directors, etc., who compose vari- 
 ous trusts and combinations 50,000,000 
 
 All dividends and surplus 134,000,000 
 
 Total f214,000,000 
 
 Add Mr. Davis' figures 160,000,000 
 
 Total $374,000,000 
 
 Suppose that the government should purchase the rail- 
 roads at their actual cost and issue bonds bearing two per cent 
 interest per annum. The best authorities concede that at 
 least one-half of the present capitalization of the roads is 
 water. But we will allow them to be valued at 6,000,000,000. 
 The annual interest charge on this sum for the first year would 
 be $120,000,000. We have already figured the net savings and 
 dividends from the roads at 8374,000,000. Deduct the interest 
 on bonds from this amount, and it leaves $254,000,000 to go into 
 a sinking fund to pay the bonded indebtedness. The interest 
 would grow less each year as the principal was being paid, and 
 within twenty years the entire debt will have been discharged 
 and not a dollar of paper money issued for the purpose, and 
 not a cent in taxes collected from the people, other than that 
 which they now pay and which goes into the pockets of rich 
 railroad magnates. The question is not whether the people 
 w ill assume the burden of debt it is already on them but 
 whether they will make provisions to get from under it, and in 
 the future lower the rates of transportation to less than half 
 what they are now. 
 
 It is claimed that if the government was to assume the 
 ownership and operation of the railroads it would create
 
 90 A New Study of Political Economy. 
 
 such an army of men dependent on political patronage and the 
 caprices of the party in power, that it would constitute a men- 
 acing danger to our liberties and a fruitful source of political 
 corruption. Under our present defective system of civil serv- 
 ice, where the principle laid down is "to the victor belong the 
 spoils," and it is a wild rush for the hog-trough to see who will 
 get the most swill, I admit the weight of this objection. But 
 the People's Party has provided for this. It recommends in 
 its platform an amendment to the Constitution by which all 
 persons engaged in the public service shall be placed under 
 civil service regulations af the most rigid character. It might 
 be well to adopt the regulations employed in the regular army, 
 permitting no one to vote or to be a delegate in a political con- 
 vention while thus in the employ of the government. So far 
 as corruption is concerned no sane man believes there would 
 be one-fourth as much as there is now. It is an open secret 
 that railroad corporations control courts, conventions and na- 
 tional and State legislatures. Well might Senator Peffer 
 make use of the following language: 
 
 "The railroad interest is a powerful one. It extends 
 throughout the entire country. There is hardly a county in 
 the Union that has not one or more railway lines running 
 through it, and there is not a mile of that vast system that is 
 not represented locally by at least one of the best lawyers to 
 be found in the region. 
 
 "If all the lawyers who are in the employ or retained in 
 the interest of the great railway systems in the country 
 were marshaled together they would form an army as large as 
 Gen. Jackson had at New Orleans, larger than Gen. Scott had 
 at Lundy B Lane. If you put together the different armies 
 made up of lawyers representing the different great railway 
 systems of the country you will find that the influence of the 
 railway system reaches out into every county in the United 
 States." 
 
 In a recent investigation of the affairs of the Santa Fe 
 railroad, it was found that seven million dollars was charged 
 as having been paid back in rebates to shippers, but two mil- 
 lions of it was BO unsatisfactorily accounted for that it was no 
 doubt stolen by the officers of the road. It seems to have be- 
 come a well-settled fact that the railroad companies violate the 
 laws with impunity, and their influence has become so power- 
 ful that they are beyond control through the ordinary course 
 of law. That they have been the most fruitful source of 
 political corruption, let the history of the land grants, subsi- 
 dies of bonds, control of courts and legislatures testify. In- 
 deed, this is one of the very best reasons why the government
 
 A New Study of Political Economy. 91 
 
 should own and operate the roads as it does the postal system. 
 THE SUB-TREASURY. 
 
 It is charged that we favor the sub-treasury system as 
 proposed by the Alliance, and our opponents tax their inge- 
 nuity to build straw men to tear down. The declaration of 
 our platform is plain on this question. It says that we favor 
 the distribution of money through the sub-treasury, or a bet- 
 ter system. Our opponents think there is a better system, 
 and I think so, too. In fact, I believe that nearly all our 
 party think so. I believe that the Omaha convention thought 
 so when it put a declaration in the platform favoring govern- 
 ment postal banks. We had made rapid strides, educating 
 the people along the sub- treasury lines. It was thought best 
 by some of our people not to drop it entirely at that time. 
 The principle involved was all right. The details of the plan 
 were never settled upon except by Democratic orators and Dr. 
 Macune, who tried to sell the People's Party in 1892, but failed 
 to deliver the goods. It is generally conceded now that the 
 only utility about the sub-treasury plan is to furnish Demo- 
 cratic orators a theme to talk about -something they know 
 nothing of in order to give the people a rest on the tariff 
 racket. 
 
 "ABOVE all things good policy is to be used, that the 
 treasures and moneys of the state be not gathered into a few 
 hands; for, otherwise, a state may have great stock and yet 
 starve. And money is like muck, not good except spread. 
 This is done by suppressing, or at least keeping a strait 
 hand upon the devouring trade of usury, engrossing, great 
 pasturages and the like." Bacon, 
 
 The wise of all ages have ever put the same estimate upon 
 the injustice and the danger of centralizing the wealth and 
 resources of a nation in the hands of a few of its citizens. 
 Bacon saw it three hundred years ago, the thoughtful see it 
 now. It is more unjust and dangerous now than in Bacon's 
 time, for the degree and rapidity of centralization is greater 
 now than then. 
 
 " TRUTH crushed to earth shall rise again. 
 
 The eternal years of God are hers; 
 But error, wounded, writhes with pain 
 And dies among his worshipers." Byron.
 
 4i " In this great contest the brains and muscles of the South 
 and West must unite, for self-defense, against the cunning and 
 aggression of the Northeastern part of the Union" 
 
 IGNATIUS DONNELLY, 1874. 
 
 SECTIONALISM IN AMERICAN POLITICS. 
 
 % 
 
 C^ECTIONALISM first made its appearance in American 
 **J politics in 1808, when Pinckney was defeated by Madison, 
 the Federalist Party losing every part of the country except 
 New England. The civil war arrayed the North against the 
 South, and every reader of recent history knows how the 
 "bloody shirt" was waved to foster sectional feeling and to di- 
 vert the minds of the voters from really important issues. The 
 People's Party has broken up the "solid South," and veterans 
 who wore the gray are now fraternizing everywhere with those 
 who wore the blue. The sectionalism in American politics 
 to-day runs along other lines than those of war sentiment. It 
 is now the Northeast against the rest of the Union, just as it 
 was New England against the rest of the Union in the days of 
 Madison. 
 
 Hon. W. J. Bryan, in a newspaper article dated February 
 16, 1895, calls attention to a speech made by ex-Speaker Reed 
 in Boston, in 1893, quoting the following extract: 
 
 "And let me tell you right here that there is no State so 
 deeply interested [in protection] as the State of Massachusetts. 
 If it were not for its condition I should say, 'Let these men 
 try it. Let us have the lesson of free trade burned into the 
 quick, and then let us have peace.' [Applause.] But when 
 Massachusetts sits around to mourn her destroyed factories, 
 her ruined industries, her closed machine shops, she sits 
 around to mourn for eternity; for if they are once destroyed 
 the omnivorous West will do the manufacturing for the coun- 
 try. [Applause.] You have the start; you have the power; 
 you have the prestige. You can keep it or you can throw it 
 away, and the only way in which you can keep it is by making 
 the voice of the majority of your people to be heard, and to be 
 heard across the country. [Applause.]" 
 
 "I do not mention this," says Mr. Bryan, "as vindicating 
 the cause of the new sectionalism, for I believe the tariff ques- 
 
 93
 
 Sectionalism in American Politics. 93 
 
 tion to be in the process of settlement, but because so eminent 
 an authority as Mr. Reed here made an appeal to the people of 
 Massachusetts to support a certain revenue policy, first, be- 
 cause Massachusetts was more interested in it than any other 
 State, and, second, because a reversal of the policy would 
 transfer the manufactures of New England to the omnivor- 
 ous West. 
 
 "The old sectionalism was founded upon slavery, and as 
 the years went on the conflict became more bitter until it re- 
 sulted in the attempt at separation. It only requires a glance 
 at recent legislation to show the difference which is becoming 
 more and more noticeable between the opinions of those living 
 in the Northeast and the opinions of those who live in the 
 South and West, but the remedy will be a peaceable one. 
 The geographical division is not as clearly defined as the Ma- 
 son and Dixon line, but it is being made more distinct by each 
 vote taken. The slavery issue, as feeling grew more intense, 
 entered into nearly every public question, because every im- 
 portant question would to a greater or less extent affect slav- 
 ery. The money question is the great question which divides 
 the Northeast from the rest of the country, and there is 
 scarcely a public question of any importance which the money 
 question does not creep into or fasten upon in some way. The 
 Northeastern States believe in a single gold standard; the 
 South and West believe in bimetallism. This division is as 
 natural as the former division between the North and the 
 South. The slave-holder of a generation ago was as kind and 
 generous and hospitable' as the New Englander, but he had 
 inherited slaves as property or purchased them, and he felt 
 that any attempt to take them away from him was a violation 
 of his rights. That was perfectly natural. He also believed 
 that the slave was better off as a chattel than he would be as 
 a free man. The people who lived in the North did not own 
 slaves, and therefore to them the abolition of slavery brought 
 no direct pecuniary loss, and it was much easier for them to 
 advocate emancipation. 
 
 "The gold standard appreciates the value of money, and 
 since the Northeastern States own a great deal of capital and
 
 94 Sectionalism in American Politics. 
 
 loan money to other parts of the country they secure what 
 might be called an unearned increment. To say that they en- 
 joy this unearned increment is to say that they are human, 
 and it is not strange that they are able to convince themselves 
 that what is good for them must be good for the rest of the 
 people. The people in the South and West are, relatively 
 speaking, debtors, and as the purchasing power of the dollar 
 increases they feel their pecuniary burdens becoming heavier. 
 To say that they do not enjoy contributing to the unearned 
 increment of their Eastern brethren is to say that they are 
 also human. Before the war there were many in the South 
 who owned slaves and yet favored emancipation, while there 
 were many in the North who defended the institution of slav- 
 ery, although not slave-owners themselves. So it is to-day. 
 Scattered throughout the East will be found many who oppose 
 the gold standard, some on the ground that it is morally 
 wrong to change the contract between debtor and creditor, and 
 others on the ground that the East will find that its share of 
 the general prosperity to be secured by the restoration of bi- 
 metallism will be greater than its present share of the limited 
 prosperity possible under a gold standard. There are also to 
 be found throughout the South and West those who are in 
 favor of the gold standard, some because they are theoretically 
 opposed to bimetallism, and others because they are connected 
 with Eastern financial concerns, but it is as true to-day as it 
 was forty years ago that opinion and interest are generally 
 found on the same side of the question. 
 
 "A great deal is being said now about the selection of a 
 Western man for President, and the reason for this talk is 
 found in the fact that a President with the veto power can 
 prevent new legislation or the repeal of existing laws if sup- 
 ported by more than one-third of either house. For instance, 
 Mr. Cleveland was able to prevent the coining of the seignior- 
 age, although a considerable majority in both houses voted 
 for the bill. Mr. Cleveland lives in New York, and naturally 
 imbibes the sentiment prevalent in the metropolis, but see 
 what an advantage the Northeast secures when it controls the 
 veto power. That the sectional spirit is growing cannot be
 
 Sectionalism in American Politics. 95 
 
 denied, although men will differ as to the remedy for it. Our 
 "Northeastern brethren will say that there is a simple cure 
 namely, that the South and West should quit finding fault 
 with Eastern ideas, while the remedy proposed on the other 
 side is that the East should be satisfied with equal opportuni- 
 ties and equal rights and quit trying to devour everything in 
 sight. The West and the South are strong enough in numbers 
 to elect a President and control both houses of Congress; when 
 they do so they will restore the gold and silver coinage of the 
 Constitution and remedy what they regard as the abuses of 
 government. This union is one of the certainties of the fu- 
 ture; its exact date only is uncertain." 
 
 In that excellent work, "Seedtime and Harvest," Mr. S. S. 
 King has collated some startling facts as to the accumulation 
 of wealth in the Northeastern States. The computation is 
 from the official census reports of 1890 and is therefore beyond 
 question. 
 
 The State of Massachusetts gained more wealth in the 
 decade 1880-90 than the States of Indiana, Illinois, Iowa, Ne- 
 braska, Louisiana, Mississippi, Alabama, Georgia and North 
 Carolina combined. 
 
 Pennsylvania gained more wealth in the same period than 
 Indiana, Illinois, Iowa, Nebraska, Louisiana, Mississippi, 
 Alabama, Georgia, North Carolina, Kansas, Kentucky and 
 Florida combined. 
 
 New York gained more wealth than Indiana, Illinois, 
 Iowa, Nebraska, Louisiana, Mississippi, Alabama, Georgia, 
 North Carolina, Kansas, Kentucky, Florida, Tennessee, Vir- 
 ginia and West Virginia combined. 
 
 Indiana, Illinois, Iowa, Nebraska, Louisiana, Mississippi, 
 Alabama, Georgia, North Carolina, Kansas, Kentucky, Flor- 
 ida, Tennessee, Virginia, West Virginia, Missouri, Arkansas, 
 South Carolina, Delaware, Maryland and Ohio, twenty-one 
 producing States forming the great body of the Union, a won- 
 derland of diversified resources, with six times as much land 
 and twice as many people to cultivate it, were able to accumu- 
 late one-half as much wealth in the period named as the nine 
 manufacturing, bondholding, banking, money-lending and
 
 96 Sectionalism in American Polities. 
 
 railroad-owning States of Maine, New Hampshire, Vermont, 
 Massachusetts, Connecticut, Rhode Island, New York, Penn- 
 sylvania and New Jersey. 
 
 The great producing body of the Union is comprised of 
 these twenty-one States. Texas was not included because its 
 wealth-gain was derived from ranch stock rather than agricul- 
 ture. This is not saying that Texas is not a great agricultural 
 State. But in addition to its agriculture it had had the other 
 great industry of stock-raising on wild lands. Vast fortunes 
 have been made from that industry, and these vast fortunes 
 give Texas a great wealth-gain. The gain is not from agricul- 
 ture, as Texas people will freely admit. The three Northern 
 pine-tree States, Minnesota, Wisconsin and Michigan were not 
 included in these comparisons, because their large wealth- 
 gains were derived from protected lumber monopolies rather 
 than agriculture, as the farmers of those States well know. 
 The new States and territories to the westward were not con- 
 sidered, because too young to furnish valuable lessons. The 
 purpose was to contrast those States engaged in agriculture 
 with those engaged in manufactures, transportation and 
 banking. 
 
 It was largely of the States named above as the producing 
 States that Senator Ingalls wrote (Lippincott's Magazine, 
 June, 1892): "Sparsely inhabited, with rude and unscientific 
 methods, their resources hardly touched, the States of the Mis- 
 issippi Valley last year produced more than three-quarters of 
 the sugar, coal, corn, iron, oats, wheat, cotton, tobacco, lead, 
 hay, lumber, wool, pork, beef, horses and mules of the entire 
 country, together with a large fraction of its gold and silver. 
 Their internal commerce is already greater than all the foreign 
 commerce of the combined nations of the earth." 
 
 These constant drains of wealth from the producing 
 States into the nine States which may be called the wealth 
 district are the cause of the new sectionalism in American 
 politics. The annexed diagram is taken from Mr. King's book. 
 It shows how the wealth of the nation converges largely into 
 the nine Northeastern States and into the three Northern 
 States which form the lumber district. Texas and the States
 
 Sectionalism in American Politic*. 
 
 97 
 
 and territories to the westward, and Minnesota, Nebraska 
 and Kansas, are not shown in the illustration. Some are too 
 young to be of any service in these comparisons, the popula- 
 tion of others is increased so largely, so much land has changed 
 from government to individual ownership, some are so remote 
 
 from the body of the nation, and in others the causes operat- 
 ing are so different from the causes operating in the Missis- 
 sippi Valley, that to include them in the illustration would be 
 manifestly unfair and tend to obscure rather than enlighten; 
 but of those portions of the country shown in the chart Mr. 
 King clearly establishes the following facts: 
 
 The lumber district (the three pine-tree States of Minne- 
 sota, Wisconsin and Michigan), with seven per cent, of the en- 
 tire population of the nation, held twelve per cent, of the 
 wealth-gain of the nation from 1880 to 1890. 
 
 The wealth district (the nine North Atlantic States 
 named) with twenty-nine per cent, of th entire population of
 
 98 Sectionalism in American Polities. 
 
 the nation, held forty-one per cent of the total wealth-gain. 
 
 Hie produce district (the twenty-one States mentioned 
 forming the body of the nation), with fifty -six per cent, of the 
 entire population, kept only twenty -three per cent, of the total 
 wealth-gain. 
 
 Thus JB seen the exceedingly unequal distribution of the 
 wealth gain considered with reference to the geographical di- 
 YKKHis indicated. This produce district, the twenty -one 
 States, can feed and clothe the world. Its fifty-six per cent of 
 the entire population of the nation, living on fruitful soil. 
 should accumulate at least its proportionate percentage of the 
 wealth-gain, instead of only twenty-three per cent. The 
 twenty-nine per cent, of the entire population, living among 
 the worn-out hfHq of New England, should not accumulate 
 more than their proportionate percentage of wealth, and when 
 that percentage goes up to forty -one, something is wrong 
 =o:r.e~ie:r. It behooves the patriot to seek to discover where 
 the wrong is. It is not in the figures. They are official. 
 Those relating to population are from Official Census Bulletin 
 No. 16, and those relating to wealth from No. 104. 
 
 " TRUTH forever on the scaffold, 
 
 Wrong fore ver on the throne. 
 But the scaffold sways the future, 
 
 And behind the dim unknown 
 Standeth God within the shadow, 
 
 Keeping watch above his own." Holme*. 
 
 " ASD how, like forts, to which beleaguers win 
 Unhoped-for entrance through some friend within, 
 One clear idea, wakened in the breast 
 By memory's magic, lets in all the rest." Moore. 
 
 " GOD is a worker. He has thickly strewn 
 Infinity with grandeur. God is love; 
 He shall yet wipe Creation's tears, 
 And all the world shall summer in His smile.'
 
 * "Property, or the dominion of man aver external objects, 
 has its origin from the Creator, as his gift to mankindP 
 BLACKSTONE (Dunlap's Manual of the General Principles oj 
 Law}. 
 
 THE LAWS OF PROPERTY, 
 
 *% 
 
 Tl MEMORABLE occasion in the history of American 
 * * politics was on the evening of October 6, 1894, when the 
 venerable Lyman Tmmbull addressed a vast audience at Cen- 
 tral Music Hall, Chicago. What he said about the laws of 
 property is now of special interest to reformers and students 
 of political economy: 
 
 It is chiefly the laws of property which have enabled the 
 few to accumulate vast wealth while the masses live in pov- 
 erty. For many generations our laws hare been framed with 
 a view to the claims of property rather than the rights of man. 
 For ages the money power has controlled legislation the world 
 over, and, I am sorry to say, has exercised a controlling influ- 
 ence in our own land for many years. In the language of the 
 Declaration of Independence: "All men are created equal and 
 endowed by their Creator with certain inalienable rights; that 
 among these are life, liberty, and the pursuit of happiness." 
 If man has an inalienable right to life, then he has a right to 
 the means which sustain life, and of which he cannot be justly 
 deprived by laws which permit one man, or set of men, to so 
 absorb the means of life as not to leave sufficient to sustain 
 the lives of all. If man has an inalienable right to liberty, 
 then he cannot be justly deprived of liberty by another who 
 assumes the right at his mere discretion to abridge it. If man 
 has an inalienable right to the pursuit of happiness, then he 
 cannot be justly deprived of that right by laws interposed in 
 the way of its pursuit. 
 
 Do such laws exist, and if so, how came they into exist- 
 ence? 
 
 In Great Britain, whence we have derived most of our 
 laws of property, the policy is to build up great estates. 
 Hence, by the laws of that country, land descends to the 
 eldest son, to the exclusion of the other children. The effect 
 of this is to limit the ownership of land to a few persons. 
 Thirty-four persons in that country own six million two hun- 
 dred and eleven thousand acres of land. The Duke of Suther- 
 land is said to own one million three hundred and fifty-eight 
 
 99
 
 100 The Law* of Property. 
 
 thousand acres, and a few other dukes and earls own a great 
 proportion of the land of the United Kingdom. What has 
 brought about this wide difference in the ownership of land? 
 Certainly the few who own the millions of acres, from which 
 they derive revenue, in some instances of more than five hun- 
 dred thousand dollars annually, in rentals, have not earned 
 these vast estates by their own industry, but on the contrary 
 it is by force of statutory enactments that these vast estates 
 have been accumulated and perpetuated in few hands. 
 
 In this country we have abolished the laws of primogeni- 
 ture, by which the eldest son inherited the landed estate of 
 his ancestor, but here vast estates are being rapidly accumu- 
 lated in few hands, and this is especially true during and since 
 the war of the rebellion. In 1860 there were few millionaires 
 and few large fortunes m this country, but since then a rich 
 class has sprung up, so that in 1890, according to reliable sta- 
 tistics, ten per cent, of the people own as much wealth as the 
 other ninety percent. In 1890 there were 12,690,182 families 
 in the United States, and according to Geo. K. Holmes, in the 
 Political Science Quarterly, 4,047 of these possessed about 
 seven-tenths as much as do 11,593,887 families. Just think of 
 it. One family possessing the wealth of 2,000 families the 
 country over! In the city of New York alone, there are said 
 to be five men whose aggregated wealth exceeds $500,000,000. 
 How many hundred millions are held by various wealthy cor- 
 porations, coal and oil syndicates and other trusts, I am unable 
 to state. In each of the cities of New York and Chicago more 
 than 100,000 men and women, willing to work, were out of em- 
 ployment last winter, many of whom must have perished from 
 want, but for charity's aid. These conditions another winter 
 promise to be no better. 
 
 The richest corporations and persons on earth are probably 
 in the United States. How have they accumulated their vast 
 fortunes? Surely not by their own industry and thrift, but 
 by the aid of statutes regulating the rights of property, 
 generally statutes providing for the transmission of property 
 by descent or by will, or the creation of monopolies. 
 
 It is only by virtue of statutory law that man is permitted 
 to make disposition of his property by will, and it is only by 
 virtue of statutory law that one person is permitted to inherit 
 property from another, and it is by virtue of statute law that 
 great corporate monopolies have been built up. 
 
 No man has a natural right to dispose of property after 
 death, nor has one person a natural right to inherit property 
 from another. As Blackstone says: "There is no foundation 
 in nature or in natural law why the son should have the right 
 to exclude hii feUow-creaturet from a determinate spot of
 
 The Lawt of Property. 101 
 
 land because his father did so before him, or why the occu- 
 pier of a particular field or of a jewel, when lying on his death- 
 bed, and no longer able to maintain possession, should be able 
 to tell the rest of the world which of them should enjoy it 
 after him." 
 
 Under Illinois laws, the owner of real estate is permitted to 
 lease it for an indefinite period, and compel future generations 
 who occupy the premises to pay rent to unborn generations. 
 Leases for ninety -nine years are quite common in Chicago. It 
 is by no divine law that the occupant of land to-day is allowed 
 to compel its occupant one hundred years hence to pay 
 tribute for its use. The statutes of Illinois have given to the 
 owner of property the right to dispose of it by will, not 
 wholly, but to a certain extent. If married, neither the 
 husband nor wife can give away the homestead or dower 
 rights of the other, nor can creditors, heirs or devisees take 
 Irom the widow her allowance. 
 
 The money power has governed legislation in all civilized 
 countries for generations. It matters not what party ia in 
 power in the national or Stategovernments of our own country, 
 the money power has exercised a controlling influence in 
 many instances in the shaping and administration of our laws. 
 
 If the accumulation of vast fortunes goes on another 
 generation with the same accelerated rapidity as during the 
 present, the wealth of this country will soon be consolidated 
 in the hands of a few corporations and individuals to as great 
 an extent as the landed interests of Great Britain now are. 
 
 What is the remedy for this state of things, which, if 
 permitted to continue, will make the masses of the people de- 
 pendent upon the generosity of the few for the means to live? 
 So far as concerns corporations of a public or quasi-public 
 character and none others should exist the remedy is simple. 
 They are completely under the control of the legislatures, 
 whence they derive all their powers. 
 
 It is entirely competent for a legislature to provide the 
 manner in which the business of a corporation shall be con- 
 ducted. It may provide that the directors phall consist of few 
 or many persons, that a portion of them shall be taken from 
 the employes of the corporation, selected by them, another 
 part from the stockholders who furnish the capital for carry- 
 ing on its business. It may provide that the employes shall 
 first be paid from the revenues of the company a certain fixed 
 sum, graduated according to the character of the work per- 
 formed by each; that a fair rate of interest shall then be paid 
 upon the capital invested, and the balance be distributed 
 upon some equitable principle between the employes and the 
 stockholders. In case of loss the stockholders would have to
 
 102 The Laws of Property. 
 
 suffer, since the employe, having a right to live, must in all 
 cases receive his daily wages when dependent upon them for 
 subsistence. This principle receives judicial sanction from 
 United States Circuit Judge Caldwell, in a recent order en- 
 tered in case of the Santa Fe Railroad, as follows : 
 
 "Ordered that the men employed by the receivers in the 
 operation of the road and the conduct of its business shall be 
 paid their monthly wages not later than the 15th of the 
 month following their accrual. If the earnings of the road 
 are not sufficient to pay the wages of the men as herein di- 
 rected, the receivers are hereby authorized and required to 
 borrow from time to time, as occasion may require, a sufficient 
 sum of money for that purpose. The obligations of the re- 
 ceivers for money borrowed for this purpose specified in this 
 order shall constitute a lien on the properly of the trust prior 
 and superior to all liens thereon." 
 
 Under the powers inherent in every sovereignty, government 
 may regulate the conduct of its citizens towardjeach other, and, 
 when necessary for the public good, the manner in which each 
 shall use his own property. 
 
 Formerly, corporations having special privileges were 
 created by special acts, which the courts construed to be con- 
 tracts between the granting power and the corporators, which 
 once granted could not be repealed or varied by the granting 
 power. This granting of charters to favored individuals, con- 
 ferring upon them privileges not possessed by the general pub- 
 lic, became obnoxious to public sentiment, and, as a conse- 
 quence, general laws have been passed in this and many other 
 States, under which any three persons may become incorpor- 
 ated for any private purpose. This has become a worse evil 
 than the old system af granting special charters. Under the 
 general law enacted in this State twenty years ago, I am in- 
 formed, 27,200 corporations have been created. 
 
 Irresponsible persons are often induced, for a small consid- 
 eration, to form corporations with a proposed capital of millions; 
 to subscribe for the whole stock except a share or two, and for 
 a fancied, imaginary or worthless consideration, to issue to 
 themselves fully paid up stock, which is subsequently trans- 
 ferred to the real parties in interest, who expect thereby to 
 escape personal liability if the concern is a failure, and to pocket 
 theprofits if a success. Business of all sorts is now to a great 
 extent carried on in the name of corporations, in order that the 
 proprietors may escape personal responsibility. How can the 
 individual, who is personally responsible for his contracts, suc- 
 cessfully compete with acorporation run by persons who incur 
 no such responsibility? Doing business in a corporate name 
 not only paralyzes individual effort, but leads to a concentra- 
 tion of capital the great evil of our time. The remedy for this
 
 The Laws of Property. 103 
 
 growing state of things would be to restrict the formation o^ 
 corporations to such as are formed for public purposes, or such 
 as the public have an interest in. Seventy -eight per cent, of 
 the great fortunes of the United States are said to be derived 
 from permanent monopoly privileges which ought never to have 
 been granted. 
 
 As before stated, the power to dispose of property after 
 death by will is conferred by statute, under certain limita- 
 tions. Why should this privilege be given to dispose of more 
 than a fixed amount of property to any one individual, say 
 property to the value of not over five hundred thousand dol- 
 lars to the wife, of not more than one hundred thousand dollars 
 to each child, and of not more than fifty thousand dollars to 
 any other relative, extending to the third or fourth degree, and 
 that the balance of the estate should escheat to the State, to 
 be used by it for the support of schools, charitable institutions, 
 the employment of laborers in making roads, and other good 
 purposes? 
 
 The law now provides for the escheat of estates of persons 
 dying without heirs. The same limitation might be put upon 
 inheritances where there is no will, and in this way the accum- 
 ulation of vast estates by inheritance or devise would be 
 checked, and property, especially landed estates, which by na- 
 ture belong to all, would be more equally distributed. It should 
 not be forgotten that the method of transmitting property 
 from the dead to the living is entirely derived from the state. 
 If public policy requires that the state should give to the dying 
 possessor, no longer able to control or take with him his pos- 
 sessions, the privilege of disposing of so much as may be con- 
 ducive to the comfort and happiness of his surviving kindred, 
 does it require that this privilege should be extended to his 
 disposition of millions to the injury of the rest of mankind? 
 
 If it be said that to limit the privilege of disposing of ex- 
 ceeding a million dollars of property by devise or descent would 
 check enterprise and industry, as no man would struggle to 
 acquire property which he could not leave to his surviving 
 kindred, my reply is, that man by his own thrift and industry 
 is seldom able to acquire more than a million dollars' worth of 
 property. Fortunes exceeding that amount are usually ac- 
 quired by speculation, trickery, or some device by which one 
 man takes advantage of his fellow-man, and which, if not ille- 
 gal, is immoral; or by members of privileged monopolies, trusts 
 and syndicates, 
 
 I don't mean to say that all great fortunes exceeding a mil- 
 lion have been acquired by immoral means, but such as have not 
 are the exception, and to limit the privilege of disposing of more 
 than a million by devise or descent would not affect one in ten
 
 104 The Laws of Property. 
 
 thousand of the people. In short, such limitations would tend 
 to discourage, not honest enterprise and industry, but stock 
 jobbing, trickery and other questionable methods of acquiring 
 vast fortunes. 
 
 We have already abolished primogeniture, by which the 
 eldest son, to the exclusion of all other children, inherits the 
 entire landed estate of his ancestor, and no one in this country 
 at this day would think of restoring that right, although it 
 still obtains in England. If limitations should be put upon the 
 disposition of vast estates by will or descent, f utui e generations 
 would doubtless look upon our present laws, which allow such 
 estates to be perpetuated in certain families, with the same 
 disfavor with which we now look upon the laws of primogeni- 
 ture. 
 
 Evasions of laws limiting the amount of property to be de- 
 vised or inherited, by conveyances during life, could be pro- 
 hibited in like manner as conveyances in fraud of creditors are 
 now prohibited. 
 
 * 
 God Save the People! 
 
 When wilt thou save thy people? 
 
 O God of mercy! when? 
 Not kings and lords, but nations; 
 
 Not thrones and crowns, but menl 
 Flowers of thy heart, O God, are they} 
 Let them not pass like weeds away 
 Their heritage a sunless day. 
 God save the people! 
 
 Shall crime bring crime forever, 
 
 Strength aiding still the strong? 
 Is it thy will, O Father, 
 
 That man shall toil for wrong? 
 "No!" say thy mountains. "No!" thy skies; 
 Man's clouded sun shall brightly rise 
 And songs ascend instead of sighs! 
 God save the people 1 
 
 When wilt thou save the people? 
 
 O God of mercy! when? 
 The people, Lord, the people! 
 
 Not thrones and crowns, but men! 
 God, save the people, thine they are, 
 Thy children, as thy angels fair; 
 Save them from bondage and despair! 
 
 God save the people! Ebenezer ElMott.
 
 | The great Napoleon said, after studying a set of compound 
 interest tables : " There is one thing to my mind more won- 
 derful than all the rest, and that is, that the deadly fact 
 buried in those tables has not before this devoured the whole 
 world" 
 
 INTEREST AND USURY. 
 
 -^ 
 
 HpHE ethical sense of mankind saw at an early day the wrong 
 * of usury. The Mosaic law was very explicit on the sub- 
 ject. Cicero mentions that Cato.be ing asked what he thought 
 of usury, made no other answer to the question than by asking 
 the person who spoke to him what he thought of murder. 
 The Christian Church, in its early days and until the 
 end of the Middle Ages, utterly forbade the exaction of inter- 
 est. In the reign of Edward VI. a prohibitory act was passed, 
 for the stated reason that the charging of interest was li a vice 
 most odious and detestable and contrary to the word of God." 
 It was not until the time of the Reformation that this inter- 
 pretation of the divine law was ever questioned. Calvin was 
 one of the first to contend that the sentiment against exact- 
 ing interest arose from a mistaken view of the Mosaic law. A 
 series of enactments, known as the Usury Laws, restricted the 
 maximum rate to be charged in England. By Act 21 James 
 I., this rate was fixed at 8 per cent. During the Common- 
 wealth this rate was reduced to 6 per cent., and by Act 12 
 Anne to 5 per cent., at which rate it stood until 1839. In the 
 United States the legal rate of interest varies, nearly all the 
 States having passed statutes fixing a maximum rate. 
 "It is against nature for money to breed money." 
 "Usury bringeth the treasures of a realm or state into a 
 few hands; for the usurer being at certainties, and others at 
 uncertainties, at the end of the game most of the money will 
 be in the box; and ever a state fiourisheth when wealth is more 
 equally spread." 
 
 These quotations are from the essay Of Usury, by that 
 wisest of philosophers, Francis Bacon. The reader must bear 
 in mind that while nowadays the term "usury" is applied gen- 
 
 106
 
 106 Interest and Usury. 
 
 erally only to excessive interest, in Bacon's time the word was 
 used for any rate of premium or interest for the use of money. 
 The word usance, now obsolete in that sense, conveyed the 
 same meaning, and is used in Shakespeare's "Merchant of 
 Venice." The provocation which Antonio first gave Shylock 
 was that 
 
 "He lends out money gratis and brings down 
 The rate of usance here with us in Venice." 
 
 All are familiar with the conditions which Shylock ex- 
 acted of Antonio: 
 
 Shylock. This kindness will I show. 
 
 Go with me to a notary, seal me there 
 
 Your single bond; and, in a merry sport, 
 
 If you repay me not on such a day, 
 
 In such a place, such sum or sums as are 
 
 Expressed in the condition, let the forfeit 
 
 Be nominated for an equal pound 
 
 Of your fair flesh, to be cut off and taken 
 
 In what part of your body pleaseth me. 
 
 Antonio. Content, i' faith: I'll seal to such a bond 
 And say there is much kindness in the Jew. 
 
 Bassanlo. You shall not seal to such a bond for me: 
 I'll rather dwell in my necessity. 
 
 Antonio. Why, fear not, man; I will not forfeit it; 
 
 Within these two months, that's a month before 
 
 This bond expires, I do expect return 
 
 Of thrice three times the value of this bond. . . . 
 
 Come on; in this there can be no dismay; 
 
 My ships come home a month before the day. 
 
 But Antonio's ships did not come in just as the farmer's 
 crop often fails and the artisan's employment gives out just 
 When the mortgage is due and Shylock claimed his pound of 
 flesh. "The Merchant of Venice" is a comedy, and Shylock, 
 Bassanio and Antonio are mere creatures of imagination; but 
 there are thousands of tragedies enacted every day in real life 
 in which real Shylocks play a part. The Shylocks of to-day 
 are quite unlike the Shylock of fiction, however. Banker 
 Morgan, who negotiated with Grover Cleveland the star-cham- 
 ber bond deal by which the American government sold to the
 
 Interest and Usui*y. 107 
 
 Rothschilds at a premium of only % per cent. $100,000,000 of 
 interest-bearing gold bonds which were immediately after 
 quoted at a premium of 21 per cent., is a philanthropist. As 
 soon as possible after the deal was made his portrait appeared 
 in many of the great dailies with a fulsome account of his 
 many charities! It will take many a pound of human flesh, 
 many a drop of life's blood, to pay the interest on the bonds 
 which he negotiated, and out of the sale of which he made a 
 cool million in one day. 
 
 The Bible has much to say on the subject of usury. The 
 writer has never heard a sermon preached on any of the fol- 
 lowing texts, perhaps because bankers and money-lenders rent 
 the best pews. Remember that usury here means simply in- 
 terest not excessive interest: 
 
 Exodus 22:25: "If thou lend money to any of my people 
 that is poor by thee, thou shalt not be to him as an usurer, 
 neither shalt thou lay upon him usury." 
 
 Deuteronomy 23: 19-20: "Thou shalt not lend upon usury 
 to thy brother; usury of money, usury of victuals, usury of 
 anything that is lent upon usury. Unto a stranger thou 
 mayest lend upon usury, but unto thy brother thou shalt not 
 lend upon usury, that the Lord thy God may bless thee." 
 
 Nehemiah 5:7: "Then I consulted with myself, and I re- 
 buked the nobles, and the rulers, and said unto them: Ye ex- 
 act usury every one of his brother. And I set a great assem- 
 bly against them." 
 
 Psalms 15:5: David describes a citizen of Zion: "He 
 that putteth not out his money to usury, nor taketh reward 
 against the innocent." 
 
 A Chapter from "Caesar's Column." 
 
 I cannot do better here than quote a significant chapter 
 from Ignatius Donnelly's powerful novel "Caesars Column," 
 which certainly did as much as any book ever printed to set 
 people thinking: 
 
 "But what would you do, my good Gabriel," said Maxi- 
 milian, smiling, "if the reformation of the world were placed in 
 your hands? Every man has a Utopia in bis head. Give me 
 some idea of yours."
 
 108 Interest and Usury. 
 
 "First," I said, "I should do away with all interest on 
 money. Interest on money is the root and ground of the 
 world's troubles. It puts one man in, a position of safety, 
 while another is in a condition of insecurity, and thereby it at 
 once creates a radical distinction in human society." 
 
 "How do you make that out?" he asked. 
 
 "The lender takes a mortgage on the borrower's land, or 
 house, or goods, for, we will say, one-half or one-third their 
 value; the borrower then assumes all the chances of life to re- 
 pay the loan. If he is a farmer, he has to run the risk of the 
 fickle elements. Rains may drown, droughts may burn up his 
 crops. If a merchant, he encounters all the hazards of trade; 
 the bankruptcy of other tradesmen; the hostility of the ele- 
 ments sweeping away agriculture, and so affecting commerce; 
 the tempests that smite his ships, etc. If a mechanic, he is 
 still more dependent upon the success of all above him and 
 the mutations of commercial prosperity. He may lose employ- 
 ment; he may sicken; he may die. But behind all these risks 
 stands the money-lender, in perfect security. The failure of 
 his customers only enriches him; for he takes for his loan prop- 
 erty worth twice or thrice the sum he has advanced upon it. 
 Given a million of men and a hundred years of time, and the 
 slightest advantage possessed by any one class among the mil- 
 lion must result, in the long run, in the most startling dis- 
 crepancies of condition. A little evil grows like a ferment it 
 never ceases to operate; it is always at work. Suppose I bring 
 before you a handsome, rosy-cheeked young man, full of life 
 and hope and health. I touch his lip with a single bacillus of 
 pt hisis pulmonalfs consumption. It is invisible to the eye; 
 it is too small to be weighed. Judged by all the tests of the 
 senses, it is too insignificant to be thought of; but it has the 
 capacity to multiply itself indefinitely. The youth goes off 
 singing. Months, perhaps years, pass before the deadly disor- 
 der begins to manifest itself, but in time the step loses its elas- 
 ticity; the eyes become dull; the roses fade from the cheeks; 
 the strength departs, and eventually the joyous youth is but 
 a shell a cadaverous, shrunken form, inclosing a shocking 
 mass of putridity; and death ends the dreadful scene. Give 
 one set of men in a community a financial advantage over the 
 rest, however slight it may be almost invisible and at the 
 end of centuries that class so favored will own everything and 
 wreck the country. A penny, they say, put out at interest the 
 day Columbus sailed from Spain, and compounded ever 
 since, would amoui.t now [A. D. 1990] to more than all the as- 
 sessed value of all the property, real, personal and mixed, on 
 the two continents of North and South America." 
 
 "But," said Maximilian, "how would the men get along 
 who wanted to borrow?"
 
 Interest and Usury. 109 
 
 -The necessity to borrow is one of the results of borrow- 
 ing. The disease produces the symptoms. The men who are 
 enriched by borrowing are infinitely less in number than those 
 who are ruined by it; and every disaster to the middle class 
 swells the number and decreases the opportunities of the help- 
 less poor. Money in itself is valueless. It becomes valuable 
 only by use by exchange for things needful for life or com- 
 fort. If money could not be loaned it would have to be put 
 out by the owner of it in business enterprises, which would 
 employ labor; and as the enterprise would not then have to 
 support a double burden to-wit, the man engaged in it and 
 the usurer who sits securely upon his back but would have 
 to support only the former usurer, that is, the present em- 
 ployer its success would be more certain; the general pros- 
 perity of the community would be increased thereby, and there 
 would be, therefore, more enterprises, more demand for labor, 
 and consequently higher wages. Usury kills off the enterpris- 
 ing members of a community by bankrupting them, and leaves 
 only the very rich and the very poor; but every dollar the 
 employers of labor pay to the lenders of money has to come 
 eventually out of the pockets of the laborers. Usury is there- 
 fore the cause of the first aristocracy, and out of this grow all 
 the other aristocracies. Inquire where the money came from 
 that now oppresses mankind, in the shape of great corpora- 
 tions, combinations, etc., and in nine cases out of ten you will 
 trace it back to the fountain of interest on money loaned. The 
 coral island is built up of the bodies of dead coral insects; 
 large fortunes are usually the accumulations of wreckage, and 
 every dollar represents disaster." 
 
 How Wealth Accumulates. 
 
 As proof of the fact that it is a mighty fortunate thing for 
 humanity that the Rothschilds did not conduct a bank in the 
 year 1 A. D., I reprint from the Twentieth Century the follow- 
 ing article by H. C. Whitaker, which shows the beauties of in- 
 terest-drawing: 
 
 "Had one cent been loaned on the 14th day of March, 
 A. D. 1, interest being allowed at the rate of 6 per cent., com- 
 pounded yearly, then 1894 years later that is, on March 14, 
 1895 the amount due would be 3,497,840,000,000,000,000,000,- 
 000,000,000,000,000,000,000,000 (8,497,840,000 decillions). If it 
 were desired to pay this in gold, 23.2 grains to the dollar, then, 
 taking spheres of pure gold, each the size of the earth, it 
 would take 610,070,000,000,000,000 of them to pay for that cent. 
 Placing these spheres in a straight row, their combined length
 
 110 Interest and Usury. 
 
 would be 4,820,870,000,000,000,000,000 miles, a distance which 
 it would take light (going at the rate of 186,330 miles per sec- 
 ond) 820,890,000 years to travel. 
 
 "The planets and stars of the entire solar and stellar uni- 
 verse, as seen by the great Lick telescope, if they were all of 
 solid gold, would not nearly pay the amount. A single sphere 
 to pay the whole amount, if placed with its center at the sun, 
 would have its surface extending 563,580,000 miles beyond the 
 orbit of the planet Neptuue, the farthest in our system. 
 
 "It may be added that if the earth had contained a popu- 
 lation of ten billions, each one making a million dollars a sec- 
 ond, then to pay for that cent it would have required their 
 combined earnings for 26,938,500,000,000,000,000,000 years." 
 
 " THE young lambs are bleating in the meadows, 
 
 The young birds are chirping in their nest, 
 The young fawns are playing with the shadows, 
 
 The young flowers are blowing toward the west 
 But the young, young children, oh, my brothers, 
 
 They are weeping bitterly ! 
 They are weeping in the playtime of the others, 
 
 In the country of the free ! " Mrs. Browning. 
 
 BANKS were unknown in Virginia until 1804, yet no people 
 enjoyed more happiness or prosperity. See the official 
 report of James Guthrie, Secretary of the Treasury, June 
 30, 1855. 
 
 " A WEAPON that comes down as still 
 
 As snowflakes fall upon the sod, 
 But executes a freeman's will 
 
 As lightning does the will of God; 
 And from its force nor doors nor locks 
 Can shield you; 'tis the ballot-box." Pierpont. 
 
 WHAT stronger breast-plate than a heart untainted ? 
 Thrice is he armed that hath his quarrel just; 
 And he but naked, though locked up in steel, 
 Whose conscience with injustice is corrupted." 
 
 Shakespeare.
 
 ! "And yc shall hallow the fiftieth year, and proclaim liberty 
 throughout the land unto all the inhabitants thereof" Levit- 
 icus 25:10. 
 
 DEBT AND SLAVERY. 
 
 *% 
 
 "Debt is the fatal disease of republics, the first thing and 
 the mightiest to undermine government and corrupt the peo- 
 ple." WENDELL, PHILLIPS. 
 
 CROM the earliest dawn of history debt has ever borne a 
 * close relationship to slavery and servitude. "It is worthy 
 of remark," Bays Grote (History of Greece, vol. iii., p. 144), 
 "that the first borrowers must have been for the most part 
 driven to this necessity by the pressure of want, and contract- 
 ing debt as a desperate resource without any fair prospect of 
 ability to pay; debt and famine run together in the mind of 
 the poet Hesiod. The borrower is in this unhappy state rather 
 a distressed man soliciting aid than a solvent man capable of 
 making and fulfilling a contract; and if he cannot find a friend 
 to make a free gift to him in the former character he would 
 not under the latter character obtain a loan from a stranger 
 except by the promise of exorbitant interest and by the fullest 
 eventual power over his person which he is in a position to 
 grant." 
 
 'This remark," says Prof. Nicholson in the Encyclopedia 
 Britannica, "suggested by the state of society in ancient 
 Greece, is largely applicable throughout the world until the 
 close of the early Middle Ages." The conditions of ancient 
 usury find a graphic illustration in the account of the building 
 of the second temple at Jerusalem (Nehemiah 5: 1-12). Some 
 said: "We have mortgaged our lands, vineyards and houses 
 that we might buy corn, because of the dearth." Others said: 
 "We have borrowed money for the king's tribute, and that 
 upon our lands and vineyards, . . . and lo, we bring into bond- 
 age our sons and our daughters to be servants, . . . neither is 
 it in our power to redeem them, for other men have our lands 
 and vineyards." 
 
 Ill
 
 112 Debt and Slavery. 
 
 In ancient Greece we find a law of bankruptcy resting on 
 slavery. In Athens, about the time of Solon's legislation 
 (594 B. C.), the bulk of the population who had originally been 
 small proprietors became gradually indebted to the rich to 
 such an extent that they were practically slaves; those who 
 nominally owned their property owed more than they could 
 pay, and stone pillars erected on their land showed the amount 
 of the debts and the names of the lenders. Solon's remedy for 
 this state of affairs was to cancel all debts made on the security 
 of the land or the person of the debtor, and at the same time 
 he enacted that henceforth no loans could be made on the 
 bodily security of the debtor, and the creditor was confined 
 to a share of the property. 
 
 In Rome's early history practically the same conditions 
 prevailed as in Greece. About 500 B. C. an attempt was made 
 to remedy the evil by providing a maximum rate of interest, 
 no alteration being made, however, in the law of debt. In the 
 course of a few centuries the free farmers were utterly de- 
 stroyed. The pressure of war and taxes and usury drove all 
 into debt and into practical, if not technical, slavery. The old 
 law of debt was not really abolished until the dictatorship of 
 Julius Caesar, who than practically adopted Solon's legislation 
 of more than five centuries before, butoo late to save lie 
 middle class. 
 
 In the course of centuries and the evolution of civiliza- 
 tion chattel slavery has been abolished; but the slavery of debt 
 still remains, and usury is now, as it was in all the history of 
 mankind, the tool with which debt forges the chains of na- 
 tions. It is not the province of this work to examine into the 
 conditions of other countries than our own, but the facts now 
 to be presented will convince the thoughtful reader that the 
 American people are bound by chains of debt which it will 
 require the wisest statesmanship to break. 
 
 Representative Warner of Massachusetts (Republican), in a 
 speech delivered in Congress in 1894, stated that the in- 
 terest-bearing debts of the United States, public and private, 
 aggregated a grand total of 832,000,000,000 (thirty-two billions 
 of dollars). This would be bad enough, but careful estimates
 
 Debt and Slavery. 
 
 118 
 
 by conservative students of political economy show that the 
 amount is very much larger. 
 
 Col. W. H. Harvey, author of "Coin's Financial School," a 
 book which has probably had more readers than any work on 
 political economy ever printed in the world, makes the follow- 
 ing itemized estimate of the interest-bearing debts of this 
 country, public and private. Most of the figures are derived 
 from recognized official sources: 
 
 The national debt, according to the official 
 
 census o? 1890, was $ 891,960,104 
 
 State and municipal debts (census 1890) 1,135,210,442 
 
 Railroad bonds, 1892 (Poor's Manual, 1893) .... 5,463,611,204 
 
 Debt on farms and homes occupied by owner 
 (R. R. Porter, Sup't. Eleventh Census, in 
 North American Review, vol. 153, p. 618) 2,500,000,000 
 
 Mortgaged indebtedness of business realty, 
 street railways manufactories and busi- 
 ness enterprises, (estimated from partial 
 reports of llth census) 5,000,000,000 
 
 Loans from 8,773 national banks (Statistical 
 
 Abstracts of the United States) 2,153,769,806 
 
 Loans from 5,579 State savings, stock and pri- 
 vate banks and trust companies (Statisti- 
 cal Abstracts of the United States) 2,201,764,292 
 
 These are figures on which something definite 
 has been obtained; also the ratio of in- 
 crease from 1880 to 1890, which was from 
 86.750,000,000 in 1880 to 819,000,000,000 in 
 1890. By computing the same ratio of 
 increase we should now add 8,000,000,000 
 
 Mortgage debts on homes not occupied by 
 
 owner (estimated) 1,000,000,000 
 
 Overdue accounts due merchants, wholesale 
 and retail, drawing from 6 to 10 per cent, 
 interest (estimated) 5,000,000,000 
 
 Debts due pawn-brokers, drawingfrom 60 to 
 120 per cent, per annum or 5 to 10 per 
 cent a month (estimated) 1,000,000,000 
 
 Private debts due from individuals to indi- 
 viduals and of which there is no public 
 record or other data for census officers to 
 obtain information (estimated) 1,000.000,000 
 
 Maritime debts (estimated) 1,000,000,000 
 
 Overdrafts, judgments, overdue taxes and
 
 114 Debt and Slavery. 
 
 miscellaneous items not included in the 
 
 foregoing (estimated) 4,000,000,000 
 
 Horrible total $ 40,346,315,848 
 
 In commenting on his figures Col. Harvey says : "Debts, 
 a non-producing industry, growing to such a magnitude that 
 the profits derived from all the producing industries of 
 the country will not more than pay the interest on these debts, 
 make the producers thereafter work for the benefit of the 
 money-lender or non-producing class. When such a condition 
 as to debts arises as we now have, all money nearly gravitates 
 into the hands of the money-lenders and piles up in the mouey 
 centers. The effect of debts upon civilization has never been 
 understood generally. A prosperous country can carry about 
 a certain proportion of debt among its people without ap- 
 parent injury, but when it reaches the present proportion a 
 proportion only reached three times before in the known 
 history of the world it produces commercial paralysis and 
 the financial enslavement of the people. All the people make 
 goes to pay the money-lenders their interest. 
 
 "When you pay money to a merchant or a manufacturer 
 that you may owe, the money you pay him is paid by him to 
 others for material and other products of his business, with no 
 charge or embargo upon it, but when you pay back to a money- 
 lender a debt you owe him, the money stops there until it is 
 loaned out again to come back with interest. When this 
 grows to such an extent as to require all or most of the money 
 in the country to pay the interest on debts, then commerce 
 slackens and there is little or no money among the people ex- 
 cept as loaned out by the banks and others whose business 
 it is to loan money. They are dealing in the blood of com- 
 merce, and when they take it from the arteries of commerce 
 there is commercial sickness and distress." 
 
 The abstract of the Eleventh Census (p. 189) gives the true 
 valuation of all real and personal property in the United 
 States as only $65,037,091,198. Against this we have an in- 
 terest-bearing debt of forty billions.
 
 Debt and Slavery. 115 
 
 But Col. Harvey's figures are by no means complete. He 
 says nothing about the capital stock of the great railroad, 
 telegraph, telephone, insurance and other corporations, most 
 of which is "water." The reader may say that this is not 
 debt. But it is debt, as it represents what the companies owe 
 to their stockholders; it draws interest; it must pay salaries 
 and dividends. To say that we pay interest every year on 
 forty-five billions is a very conservative statement. And the 
 debt is constantly increasing, for the reason that there is not 
 in circulation, of all kinds of money, enough to pay this in- 
 terest. Let us figure it out. The average rate of interest is 
 6% per cent. Let us say 6 per cent. At this rate we pay 
 each year 82,700,000,000 over $40 per capita. Think of it ! 
 Forty dollars interest for every man, woman and child ! Two 
 hundred dollars for every family ! and this exclusive of taxa- 
 tion, which adds still more to the burden of life. The most 
 blatant gold-bug does not claim that there is $40 of money 
 per capita in circulation. There can be only one result and 
 that result is slavery, abject, hopeless slavery slavery under 
 the guise of freedom, but still slavery unless this burden of 
 debt is thrown off before the patient people succumb entirely. 
 
 The all-absorbing scheme of the American oligarchy to- 
 day is the increase of the war power of the nation. (It 
 now costs $52,712,014 a year to maintain it, without count- 
 ing cost of construction , $6,831,803 a year. See page 204, ab- 
 stract of Eleventh Census.) 
 
 If we look at the enormous interest-bearing debt that 
 has been imposed upon the people of this country (almost en- 
 tirely under Republican rule), we need not wonder why it is 
 necessary to strengthen the war footing. George Washington 
 said: "Beware of a government bolstered up with bayonets I" 
 Without bayonets the American government of to-day would 
 fail. 
 
 " FIRST Freedom and then Glory. When that fails, 
 Wealth, vice, corruption; despotism at last. 
 And History, with all her volumes vast, 
 Hath but one page." Byron.
 
 ) " When the 'sacredness of property ' is talked of, it should 
 be remembered that any such sacredness does not belong to 
 landed property. No titan made the land. It is the original 
 inheritance of the whole 'species. ***** When private 
 property in land is not expedient it is unjust" 
 
 JOHN STUART MILL. 
 
 THE LAND QUESTION. 
 
 * 
 
 "The land, including all the natural resources of wealth, is 
 the heritage of the people, and should not be monopolized for 
 speculative purposes." 
 
 GAERETT SMITH, the famous abolitionist, said, in 1856: 
 "Land reform is the greatest of all anti-slavery measures. 
 Abolish slavery tomorrow, and the land monopoly would pave 
 the way for its re-establishment. But abolish land monopoly, 
 make every American citizen owner of a farm adequate to his 
 necessity, and there will be no room for the return of slavery." 
 
 History proves, if it proves anything, that no government 
 can survive when the land has passed from the ownership of 
 the people. France went into the revolution when twelve per 
 cent, of her population owned all the kingdom. In our coun- 
 try to-day the land is passing from the farmers at the rate of 
 one per cent, a year; mortgages and foreclosures of mortgages 
 are steadily increasing in numbers the home-owners and 
 farm-owners are rapidly disappearing and renters and tenants 
 are taking their places. It would be useless to pile up author- 
 ities or statistics in proof of this assertion the facts are self- 
 evident. 
 
 When France went into the revolution it was her own aris- 
 tocracy that monopolized the land. In our country, the ten- 
 dency is even worse, for our land, the storehouse from which 
 nearly all our wealth is drawn, is gradually passing into the 
 hands of alien landlords and of soulless corporations much of 
 whose capital stock is owned abroad. The grants to railroads 
 in the United States amount to 325,000 square miles, an area 
 almost equal to the area of the thirteen original States. 
 
 116
 
 The Land Question. 117 
 
 That British aristocrats should rule large domains in the 
 United States is at first a difficult thing to grasp. Not until 
 it is borne in mind that peers and peeresses of Great Britain 
 are large landed proprietors in our country Viscount Scully 
 alone owns 3,000,000 acres in Illinois, Iowa and Nebraska does 
 the significance of absentee landlordism become apparent. 
 
 The greatest of the Eoglish holdings and the persons in- 
 terested are thus given by the Chicago Record: 
 
 The Texas Land Union (syndicate No. 3), 3,000,000 acres. 
 Interested peers: Baroness Burdett-Coutte, Earl Cadogan, 
 H. C. Fitzroy Somerset (this is the Duke of Beaufort), William 
 Alexander Lochiel Stephen Douglas-Hamilton, Duke of Beau- 
 don; the Duke of Rutland; Ughtaed J. Kay-Shuttleworth and 
 Ethel Cadogan, maid-in-waiting to the Queen. This syndi- 
 cate owns whole counties in Texas, and tens of thousands of 
 persons pay it rentals. 
 
 Sir Edward Reid 2,000.000 acres in Florida. This is a 
 syndicate which includes the present Duchess of Marlborough, 
 Lady Randolph Churchill and Lady Lister-Kaye. 
 
 Viscount Scully 3,000,000 acres. His lordship maintains 
 an elaborate system of bailiffs. 
 
 Syndicate No. 4 1,800,000 acres in Mississippi. This syn- 
 dicate includes the Marquis of Dalhousie, George Henry 
 Howard Cholmondeley (Viscount Cholmondeley), Georgiana, 
 Viscountess Cross, the Hon. Lady Hamilton Gordon and the 
 Hon. Lady Biddulph. 
 
 Marquis of Tweeddale 1,750,000 acres. The Marquis is 
 William Montagu Hay, famed all over Scotland as the rack- 
 rent landlord. 
 
 Phillips, Marshall & Co., London 1,300,000 acres. This 
 firm has the whole peerage for its clients. 
 
 The Anglo-American Syndicate, London 750,000 acres. 
 The funds of widowed peeresses are largely invested here. The 
 lands are in the South and West. 
 
 Bryan H. Evans, London 700.000 acres in Mississippi. 
 
 The Duke of Sutherland 125,000 acres. This is the 
 actress-loving, champagne-bibbing and rack-rent nobleman of 
 police-court fame.
 
 118 The Land Question. 
 
 The British Land Company 320,COO acres, in Kansas. 
 
 William Whalley 310,000 acres. 
 
 The Missouri Land Company 300,000 acres. This oper- 
 ates a Missouri domain and has headquarters at Edinburgh. 
 Robert Tennant, London 230,000 acres. This is all farming 
 land. 
 
 Dundee Land Company 247,000 acres. 
 
 Lord Dunmore 120,000 acres. 
 
 Benjamin Newgas, Liverpool 100,000 acres. 
 
 Lord Houghton (in Florida) 60,000 acres. 
 
 Lord Dunraven (in Colorado) 60,000 acres. 
 
 English Land Company (in Arkansas) 50,000 acres. 
 
 English Land Company (in California) 50,000 acres. 
 
 Alexander Grant, London 35,000 acres in Kansas. 
 
 Syndicate No. 6110,000 acres in Wisconsin. This syndi- 
 cate includes the Earl of Verulam and the Earl of Lankeville. 
 
 M. Elfenhauser, of Halifax 600,000 acres in West Vir- 
 ginia. 
 
 Syndicate No. 1 50,000 acres in Florida. This is a Scotch 
 concern. 
 
 Nearly 20,000 000 acres of American land are owned by 
 landlords in England and Scotland, and the Record omits en- 
 tirely the Arkansas Valley Company, in Colorado, whose in- 
 closures embrace over a million acres alone; the Prairie Cattle 
 Company (Scotch), another million, and dozens of other syn- 
 dicates which will easily bring the total up to 30,000,000 acres. 
 There is also a Dutch syndicate which owns 5,000,000 acres of 
 grazing land in Western States, and a German syndicate, own- 
 ing 2,000,000 acres in various States. It is safe to say that not 
 less than forty million acres of the land of this nation is owned 
 in Europe. 
 
 It is well known to those who have even casually looked 
 into the matter that foreign land-owning has much impeded 
 the development of the Western commonwealths. These great 
 land-owners positively refuse to sell. They prefer to establish 
 a system of agencies and bailiffs, with the result that very 
 serious complications have resulted. The State legislatures 
 have done their best to deal with the question, but with only
 
 The Land Question. 1 19 
 
 indifferent success. Viscount Scully has for years been a 
 thorn in the path of one State administration after another, 
 and his shrewdness in evading every provision of law directed 
 against him has extorted the unwilling admiration of thou- 
 sands. This Scully practically owns in Illinois the best part 
 of the counties of Logan, Livingston and Tazewell. The State 
 in 1887 passed an alien land law, directed solely against Scully. 
 To evade it he insisted beforehand upon a clause in all his 
 leases stipulating that the lessee should pay all taxes accruing 
 against the property leased. The result was the creation of a 
 large and solid body of voters in the Scully counties, as they 
 are called, opposed to propositions of public improvement by 
 taxation. 
 
 The war against Scully in Illinois threw the other British 
 land -owners into a panic, and as fast as leases have fallen in 
 they have been renewed under heavier and heavier conditions. 
 Alien land laws have occupied the attention of legislatures, 
 and in Kansas and Nebraska the struggle for a timo had a 
 serious effect upon land securities of all kinds. 
 
 Finally matters came to such a deplorable stage that a 
 committee of the American tenantry was appointed to present 
 a memorial to the London owners of land, setting forth the 
 ruin that stared the Western farmers in the face as a result of 
 the rack-renting system that had been evolved out of chaos. 
 This memorial had a marked effect upon the Baroness Burdett- 
 Coutte, who insisted upon no more eviction of American 
 farmers. It only aggravated the Duke of Sutherland, how- 
 ever, who was then in sore need of funds, and he cabled his 
 agent to collect the rents and send them over at all hazards. 
 
 Finding that mild measures availed nothing, the tenantry 
 resorted to a more radical expedient. An association was 
 formed in 1894, in Illinois, Nebraska, Iowa and Kansas, to re- 
 sist to the utmost the demands of the English landlords. The 
 orgamV/ation is a secret one and is the first really agrarian 
 agitation in American history. 
 
 "HE who has no clear, inherent right to live somewhere 
 has no right to live at_all." Horace Grecley.
 
 ft " Men lived without gas. Men lived, drawing their water 
 from wells and springs, before water-works. Men lived with- 
 out railways. Aye, men have lived, and could live again, with- 
 out money. But no man ever lived, no man can live, without 
 land." HENRY GEORGE, 
 
 AN EXPOSITION OF THE SINGLE TAX. 
 
 ^ 
 
 BY W. F. COOLING. 
 
 TpHE Single Tax is the name given to a form of taxation 
 * proposed by Henry George. It is a definite, practical pro- 
 position by which the ancient formula of philosophical democ- 
 racy, "Equal rights to all, and special privileges to none," ceased 
 to be a mere abstract generalization. Like the iceberg, seven- 
 eights of whose mass is invisible, the single tax is the unsatis- 
 factory name by which, the far-reaching social philosophy of 
 the school of Henry George is given a local habitation in the 
 form of its most characteristic and satisfactory proposal. 
 
 I. THE SINGLE TAX AND PUBLIC UTILITIES. 
 
 In a democratic eociety, whatever one man is permitted to 
 do, all should have the right to do. Whenever a business is of 
 such a nature, or, so far as any business is of such nature, that 
 it is not open to all, such business should not be permitted to 
 any private citizen, but should be managed by the whole peo- 
 ple through their government. "Where combination is possi- 
 ble competition is impossible." It is possible for any number 
 of men to open little retail stores; to engage in the various 
 trades, arts and professions; but it is not possible that the 
 business of running street cars on Chicago's streets should be 
 open to all, because the streets are limited in number. So also 
 with the water, gas, telephone, electric light and power supply. 
 The provision of these things requires a special use and mon- 
 opoly of the public streets and should be managed as public 
 businesses, because to permit such business to private enterprise 
 would be to confer a special privilege, and also because the 
 public can do the work at much less cost to the people than 
 
 120
 
 An Exposition of the Single Tax. 121 
 
 private individuals can. The great national lines of railway, 
 for the same reasons, to be more fully detailed hereafter, fall 
 into the same class as public utilities. 
 
 II. THE SINGLE TAX AND PRIVATE PROPERTY. 
 
 Single taxers assert that the state must secure, as far as it is 
 possible for positive law to do it, the absolute right of every 
 adult person to his or her faculties and labor products. Every 
 man must be recognized as the owner of himself. It may be 
 true that in a certain sense we all belong to each other and to 
 God, and that no man has an absolute property in himself or 
 anything which his labor produces. But it is also true that 
 the moral right or interest which others may have in our labors 
 is one which generally is incapable of enforcement by the state. 
 It is only in the case of war, pestilence or some other unusual 
 but definite danger threatening the community, that the abso- 
 lute individual right to life and property determines, because 
 the danger which threatens the community is a concrete one 
 against which a certain definite defense can be made, and be- 
 cause this condition of danger is temporary and unusual. In a 
 similar manner it may be said to be the duty of every person to 
 associate with some religious body, but that duty is not enfor- 
 cible by the state because it can never determine what religion 
 ia the right one. 
 
 For these reasons the state must leave to the individual 
 conscience, to the sentiment of the age, as well as to the sense 
 of individual self-interest, the working out of the subtle prob- 
 lems of association. The state must build upon the secure 
 foundation of private property in the products of labor and the 
 greatest possible personal liberty of association. In order, 
 therefore, that any one may be secure in the possession and en- 
 joyment of the products of his own labor, he must have 
 permanent and exclusive possession of the land upon which he 
 has placed valuable and lasting improvements. Otherwise no 
 forest would be cut down, no swamps drained, none of the 
 great improvements would be erected which are characteristic 
 of civilized man. The first step in the direction of civilization 
 and the development of the higher arta was taken whan th*
 
 122 An Exposition of the Single Tax. 
 
 individual right of permanent and exclusive possession of land 
 was recognized. 
 
 III. THE SINGLE TAX AND INALIENABLE EIGHTS. 
 
 The Declaration of Independence says: "All men are en- 
 dowed by their Creator with certain inalienable rights; among 
 these are life, liberty and the pursuit of happiness." Therefore 
 if a man has a right to life which cannot without act of his 
 ever be alienated, he has also an equal right to the natural 
 means by which life is sustained. That is to say, his right to 
 himself conceded, he has an equal right with all other men to 
 the world which God has created, or to nature, with all her 
 forces and substances. This great truth has been recognized 
 in all ages, as well by the savage as the civilized man. 
 IV. THE SINGLE TAX AND GROUND RENT. 
 How, then, shall the common and inalienable right of each 
 succeeding generation of men to the earth- to nature's store- 
 house be harmonized with the necessity of permanent exclu- 
 sive possession? 
 
 Ground rent, or the rental value which attaches to land as 
 a cleared site, is the measure of the advantage which the ex- 
 clusive possessor of land has over the one who has no other 
 land than such as may be had by all on equal terms. It, there- 
 fore, exactly expresses the value of the special privilege pos- 
 sessed by the possessor of land. It measures the extent of the 
 invasion of the inalienable common rights. Rent, or the price 
 paid for the use of land, is of three kinds: 
 
 1. Speculative Monopoly Rent. 
 
 2. Monopoly Rent. 
 
 3. (Economic) Rent. 
 
 3. Economic rent is the value that would attach to land 
 when all valuable, but not necessarily all useful land is put to 
 its proper use. This is the single tax. 
 
 2. Monopoly rent is the price that may be extorted from a 
 tenant and user of it for the use of land when all useful land is 
 subject to private ownership. 
 
 This is the kind of rent paid when all or nearly all the land 
 is held by great entailed estates.
 
 An Exposition of the Single Tax. 123 
 
 1. Speculative monopoly rent is the price that may be ex- 
 torted from a speculation in land which includes the present 
 monopoly rent together with some amount estimated to be the 
 future increase in value. This is the worst kind of rent and is 
 the kind usually paid in the United States. 
 
 When, therefore, valuable land is permitted to be withheld 
 from use by speculators, the land which may be had free is less 
 in quantity and in usefulness. Land-users are driven to land 
 of less and less utility or are compelled to pay as rent for the 
 more desirable the difference between the productiveness of 
 their labor on that land and upon the relatively useless land 
 which may be had for nothing. But if we were to increase the 
 quantity of useful land which could be had free rent would nec- 
 essarily fall, and if all useful land not in use could be had for 
 nothing the rent of land would fall to its lowest possible price 
 economic rent. 
 
 There are many children in our large cities who do not know 
 that milk comes from cows, or the simplest details of husban- 
 dry. This state of childish thoughtlessness is not uncommon 
 to many would-be reformers. The fundamental question in 
 economics js the relation of man to land. All wealth is the re- 
 sult of labor applied to land. Those who are paid for the per- 
 mission to use the earth get something for nothing. In all 
 cases the value of land is a social growth, not, like improve- 
 ments, the result of individual labor. All labor can be divided 
 into two kinds, viz.: primary labor, or the so-called extractive 
 processes, the work of those who in the first instance apply 
 their labor to land, as miners, lumbermen, fishermen, graziers 
 and farmers; adn secondary labor, which is the work of those 
 who prepare the raw products of primary labor for the use of 
 the consumer. The wealth which passes through the chan- 
 nels of trade takes its origin, like the waters of the Mississippi, 
 in countless multitudes of small producers engaged in the pri- 
 mary or extractive processes, from whom the lines of trade 
 converge into the great visible establishments which areas de- 
 pendent upon the primary producers for their life and being as 
 the tree trunk is upon its roots. Thus we would stimulate
 
 134 An Expotition of the Single Tax. 
 
 production at its origin, by throwing open to primary labor the 
 vast areas of unused land. 
 
 Under any form of society some revenue would be needed 
 by the government. Taxes now levied upon houses, goods, ma- 
 chinery, and license taxes, are necessarily part of the cost of 
 production, and increase the price of the article. Such taxes 
 are always shifted to the consumer. But the tax on the value 
 of land cannot be shifted by the owners of vacant and unused 
 land, because there are no tenants; nor by the owner of highly 
 improved land, because he now gets all the tenants can pay. 
 But as the tax forces the vacant land into use or into the mar- 
 ket the value of all land will fall. So a tax on the value of land 
 reduces rent. The existing tenant or future would-be user of 
 land would have his taxes abolished and his rent reduced. The 
 owner of improved land would have no taxes to pay on his im- 
 provements, and the fall in the price of other lands would re- 
 duce his tax, so that generally the owner of improved lands 
 would have less to pay than under the present system if taxes 
 were properly assessed. But the land speculator, although hit 
 hard, could console himself with the fact that he could with- 
 out charge replace his vacant land, the value of which was 
 confiscated by the single tax, by any piece of land remaining 
 unused. 
 
 The value of land is something quite apart from its nat- 
 ural utility. There is much fertile land in different parts of 
 the world to which no value attaches. An acre of corn land in 
 Kansas diffe/s much in value from an acre of equal fertility 
 and devoted to the same use near Chicago. The value of any 
 piece of valuable land is the difference between the product- 
 iveness of labor upon it and the best land which can be had 
 for nothing. 
 
 In the most primitive kind of society the individual family 
 will approach very nearly to the condition of Robinson Crusoe. 
 They will be able by constant labor to maintain themselves in 
 a rude sufficiency. But as population increases a subdivision 
 and more complex association of labor begins. There is a gain 
 which results to the community by reason of the various mem- 
 bers Batting themselves apart with systematic association to do
 
 An Expotition of the Single Tax. 126 
 
 the things which each can best accomplish. Twenty men 
 working together intelligently can do much more than twenty 
 times the work of one, and this return to labor increases with 
 every new improvement in productive processes and every new 
 addition to the community. It has been estimated by statisti- 
 cians in the employ of the United States Census Department 
 that the labor of one farmer to-d'ay working under modern con- 
 ditions is more productive than the combined labor of not less 
 than twenty men forty years ago. It is evident that, while 
 some farmers are much better off, and a few worse off, 
 none have benefited to the extent to which their productive 
 power has been increased. 
 
 This net gain which is the result of association and 
 improved processes is not evenly distributed. The benefits of 
 association and subdivision of labor are realized to the fullest 
 extent by those who employ themselves within the area where 
 association in production is most general and where subdivis- 
 ion of labor is most intense. Those who realize this net gain 
 to the least extent are those who employ themselves at places 
 remote from the centers of the highest social activity and 
 where association in productive processes and the subdivision 
 of labor is practiced to the least extent. The result is that the 
 net gain resulting from improved methods is appropriated by 
 those who control the areas so utilized for high organization 
 and subdivision of labor ; that is, the valuable land and privi- 
 leges running with such land, except so far as this gain is 
 shared by those who have access to free land. But, as it is 
 upon free land that labor to the least extent participates in the 
 net gain resulting from improved methods, there is a constantly 
 increasing advantage to those who have the power to appropri- 
 ate the larger part of the gain which results, not from their 
 individual labor, but from the profits of association. This 
 advantage is capitalized in the value of land, the rights of way of 
 railroad and other companies which possess exclusive privileges 
 running with the land. 
 
 The increase in the productiveness of labor by reason of 
 the advance of our civilization belongs of right to all. In thia 
 gain all have the same right to share on equal terms. Hence
 
 126 An Exposition of the Single Tax. 
 
 the single tax, by appropriating the amount which is unjustly 
 taken from the common gain by the monopolizers of these spe- 
 cial privileges, and by devoting it for the common use of all, 
 would lay the secure foundations of a true co-operative com- 
 monwealth by socializing the value of unequal opportunities. 
 
 The taxation of ground values is the direct tax of the free 
 traders which cannot be shifted. 
 
 The taxation of ground values is the tariff (upon specula- 
 tion) that protects industry from exploitation. 
 
 The annual rental value of the coal mines and timber lands 
 of the United States in use in 1889 was $451,000,000, according 
 to Bulletin No. 70 of the Census Department. This alone 
 would support the Federal government. 
 
 When we have abolished the fellows who get something 
 for nothing, then all will co-operate by exchange of equivalents 
 of service. All that needs be done to establish the co-oper- 
 ative commonwealth is to abolish special privilege. 
 
 V. THE SINGLE TAX AND TRANSPORTATION. 
 
 Prom the most ancient times the care of roads and bridges 
 has been an undisputed function of government. The old 
 wagon roads have long ceased to be the nation's highways. 
 
 The monopoly of trade which results from the private 
 ownership of railroads is one of the characteristics of the age. 
 It has created the Standard Oil Company, which received a "re- 
 bate" of 50 cents on every barrel of oil shipped by it and a "com- 
 mission" of 25 cents on every barrel of oil shipped by its rivals- 
 Railroad monopoly has built up the great packing monopolies 
 of Chicago and is now forcing the centralization of all business 
 in a few hands by the process of giving heavy rebates, increas- 
 ing in proportion to the volume of business done. 
 
 Single-taxers are not entirely agreed as to how they will 
 dispose of this question. One proposition is to pass a maximum 
 freight and passenger rate law and to appropriate by taxation 
 the value of special privilege of the business. Another proposi- 
 tion is that the government should build and maintain without 
 charge the roadways and let out the operation of these roads 
 to private competing companies.
 
 An Exposition of the Single Tax. 127 
 
 VI. THE SINGLE TAX AND FREE TRANSPORTATION. 
 
 Transportation charges are like taxes upon capital. They 
 are a part of the cost of production and must be added to the 
 price of the goods transported, and are therefore in all cases 
 shifted to the consumer. All, therefore, who use and consume 
 goods which are transported over railways are users of rail- 
 ways, whether they travel upon them or not, or whether they 
 are engaged in directly shipping goods or not. Transportation 
 is a means by which the advantages of special locations are 
 equalized, and therefore any reduction in the cost of transpor- 
 tation improves the value of less favored locations by giving 
 them access to the best markets. It is a notorious fact that 
 the building and operation of any needed line of transporta- 
 tion is always followed by a rise in the value of land many 
 times greater than the cost of operating and building the road. 
 The building of a short line of railroad in Kansas some years 
 ago (the Solomon Valley Railroad) was followed by a general 
 rise of value in the land many times as great as the cost of con- 
 structing the road. The building of the south side cable sys- 
 tem in Chicago a few years ago, displacing horse cars, was 
 immediately followed by a rise in value of adjacent land 
 amounting to $21,000,000, according to the Chicago Real Estate 
 Board, an amount over four times as great as the cost of con- 
 structing the road. It is the familiar argument by which farm- 
 ers are induced to vote bonds for railroads, that the road will 
 increase the value of the lands more than the amount of the 
 bonds. In all our large cities are great office buildings in which 
 elevators daily carry without charge hundreds of passengers to 
 the various floors of the building. The increase of rent pays 
 more than the cost of construction. For these reasons many 
 single-taxers, and particularly Henry George, declare that 
 railroads should be built and operated at public cost. The 
 increase in the value of land thereby resulting would more 
 than pay the expense of their construction, operation and 
 maintenance. Under the single tax, therefore, all transporta- 
 tion, both of freight and passengers and of intelligence, would 
 be free. Those who did not directly use the road themselves
 
 128 An Exposition of the Single Too:. 
 
 would nevertheless share in the reduced prices of things from 
 which the present exorbitant charges had been eliminated. 
 
 VII. THE SINGLE TAX AND FAEMERS. 
 
 Farmers are the users of the least valuable land, and they 
 also are the greatest sufferers from excessive railroad charges. 
 There is a piece of land in Chicago that recently sold at the 
 rate of $10,000,000 per acre. The ground rent of the lot on 
 which the Rookery building stands realizes the city of Chicago 
 the owner 37,500 per year. There are many townships 
 which would rent for less. Some years ago a bureau of the 
 Kansas State government stated that there was five times aa 
 much land in the State of such as was worth $20 per acre as 
 there was in use. If that was so, the single tax on such land 
 would not be over twenty cents per acre. The user of 100 acres 
 of land would pay $20 a year. Today he pays about $40 in State 
 and county and township (direct) taxes, and about $150 indi- 
 rectly in tariff taxes, and about $1,500 in the reduced price of 
 his products caused by the general system of transportation. 
 If he has a crop of corn, 50 bushels to the acre a fair crop 
 Bay of 5,000 bushels, he will be obliged to sell it for 15 cents per 
 bushel. The corn and other crops all start to move about the 
 same time. The railroads, in order to force the control of the 
 business into the hands of their agents, the elevator men, are 
 never willing to supply cars to the independent shipper. The 
 price of corn in the best markets in this country is rarely less 
 than 50 cents per bushel. Under the single tax the farmer, by 
 paying an insignificant tax on the unimproved value of the 
 land he occupied, would have free access to the home market. 
 If, therefore, the price of corn or the purchasing power of money 
 would not depreciate, he would not realize le JB than $2,000 per 
 year. 
 
 The farmer would have his annual product, which he could 
 exchange in the best market in the country. The same would 
 apply to all other products. As the prices of things in a gen- 
 eral way are an expression of the proportion in which they are 
 produced, and as the production of corn would not essentially 
 vary from the ratio which it now baars to the production of
 
 An Exposition of the Single Tax. 129 
 
 other things, the farmer's corn would still be exchangeable for 
 the same quantity of lumber, clothing and other things for 
 which it is now exchangeable in the best markets. 
 
 VIII THE SINGLE TAX AND WAGES. 
 
 In the early days of California an ordinary unskilled work- 
 man could get an ounce of gold a day working for himself with 
 average luck. As a consequence you could not hire a man to 
 wash dishes for less than about $15 per day. The wages of un- 
 skilled labor are determined by what a man can do working 
 for himself at that employment which is open to all. While 
 yet the public lands remained unappropriated and any one 
 could take up 360 acres of fairly good land at nominal charge, 
 his earnings determined the scale of wages and the standard of 
 living of all. If we suppose that the land of the Kansas farmer 
 is worth now 82,000 and his improvements and working capital 
 another $1,000, and charge him with current interest and taxes 
 upon a capital of 83,000, and subtract this from the value of his 
 annual product, he will hardly realize, one year with another 
 for his toil, over one dollar a day. His only hope is that he may 
 be able to keep out of debt, and, after a life of the most rigid 
 economy and the hardest labor, be able to live a few years in 
 his old age upon the rental value of his land. Under the single 
 tax he would from the beginning realize a handsome return, 
 not less, under the most conservative estimates, than $2,000 
 per annum. 
 
 When, therefore, any man who was willing to work and 
 who had the necessary capital could earn a good living on the 
 land which the single tax would wrest from the hands of idle 
 and useless speculators, no one who had the capital needed to 
 improve and make use of the land would work for less. When 
 any man can show the opportunity to produce a fixed return, 
 he can now and always obtain the credit (money) needed to de- 
 velop the opportunity, on the assurance of ordinary honesty 
 and industry. Under the single tax capital would not be in- 
 vested in the speculative withholding of natural opportunities, 
 sunk in idle land or railroad stocks, or government bonds, but 
 would be invested in machinery, building and the constant em-
 
 130 An Exposition of the Single Tax. 
 
 ployment of industry. Consequently the whole force of that 
 competition which now exhausts itself in the struggle for oppor- 
 tunity, which the single tax would make free to all, would then 
 be exerted in extending credits and in inviting the stranger 
 and the unemployed to develop on equal terms the resources 
 of a common country. For when special privileges are abol- 
 ished, those enterprises in which men do not formally co-operate 
 are socialized by competition. Competition is a good thing. 
 It cannot be said to exist to-day on any general scale, because 
 of the unequal terms on which producers are compelled to as- 
 sociate. The plan of single-taxers has nothing in common with 
 the so-called "socialists" who denounce competition. The 
 motto of Turgot was not "Let things alone," that is, give free 
 play to the existing economic system, as "socialistic" writers 
 and our ignorant college professors persistently misrepresent, 
 but "Clear the ways, and let things alone." 
 
 IX. THE SINGLE TAX AND THE MONEY QUESTION. 
 
 Ground rent, being the exponent of the difference between 
 the productiveness of labor on valuable land and free land, is 
 the natural measure of that competition which is the origin of 
 prices. When the government is in receipt of ground rent, and 
 is performing the proper functions pertaining to it, which in- 
 clude free transportation, it will then be enabled to issue a 
 paper currency, equal in volume to its last year's revenue, which 
 shall be a legal tender for all public debts. Under the single 
 tax there can be no inflation of land values, and as land is the 
 physical basis of life, the one object of primary and necessary 
 utility, the economic value that attaches to land will always "re- 
 deem" the currency. In a growing civilization land values as a 
 whole are constantly increasing. All that is needed to forever 
 settle the money question permanently on a scientific basis is 
 
 1. The single tax on land values. 
 
 2. The conversion of present units of value into terms of 
 economic rent. 
 
 It will be noted that nothing is here said about making 
 this money legal tender for private debts. While it may be 
 just to declare that this currency could be legal tender for all
 
 An Exposition of the Single Tax. 131 
 
 existing debts, it is greatly to be questioned whether the estab- 
 lishment of a legal tender for private debts is a function of the 
 government. The unit which is receivable as legal tender for 
 public debts will serve as a general standard of reference, but 
 private individuals contracting with each other should be free 
 to make such terms and to issue such bills of credit and private 
 paper as they choose. 
 
 X. DEBTS AND MORTGAGES. 
 
 So long as private ownership in ground rent and trans- 
 portation exists labor i s reduced to a bare subsistence. Mon- 
 opoly of land enables the owner to charge the tenant all he 
 can make above a fair living, and monopoly of transportation 
 enables the lords of transportation to exploit the landlords 
 and tends to reduce them to the condition of mere agents of 
 the transportation monopoly. Under these conditions, when 
 the average return is no more than a bare living, the ordinary 
 vicissitudes of business bad crops or an unexpected fallj in 
 prices tend to gradually involve the masses of men hopelessly 
 in debt. They are caught like n'shes in an invisible net, from 
 which only the exceptionally vigorous or fortunate escape. 
 Such is the condition of a majority of the farmers of the 
 frontier, the small business men of the cities, the mechanics 
 and wage-earners, whose employment is constantly becoming 
 more uncertain and less remunerative and whose means of 
 subsistence or whose homes are mortgaged or charged with 
 debt. The single tax will relieve these by making it possible 
 for them to pay their debts honestly. 
 
 XI. THE SINGLE TAX AND TRUSTS AND MONOPOLIES. 
 
 Monopoly is a word which is derived from the Greek lan- 
 guage and which means that the sale of the article of trade in 
 question is under one control. It is often used to mean exclus- 
 ive possession or control in the sense of exclusive property. 
 Thus we speak of land monopoly, meaning that the control of 
 land is concentrated in the hands of a few; of railroad monop- 
 oly, meaning that the control of the common highways is not 
 in the hands of the people. When the sources of production, 
 i. e. t the land and the highways, are in the hands of a few, the
 
 132 An Exposition of the Single Tax. 
 
 control of trade, or rather the commodities of trade, falls under 
 the same control. There are also other sources of monopoly, 
 such as patent laws, the partial exemption possessed by stock- 
 holders in corporations from the laws which enforce the obli- 
 gation of contracts, and laws creating restrictions upon the 
 natural right of self-employment, such as license taxes and 
 trade restrictions. Nearly all the trusts and monopolies are 
 rooted in privileges of this kind. The Standard Oil Company 
 could not maintain control of the business it now holds at 
 present prices when the sources of supply, the oil wells, are 
 forced into use by the single tax, and when transportation 
 charges are eliminated. 
 
 The throwing open to all of the markets of trade by free 
 transportation and the natural sources of production by the 
 single tax would insure such large returns to primary labor 
 that no workman woujd be satisfied with wages less in amount 
 than he could earn working for himself. And when in all our 
 shops and factories the lowest return given to the mere man- 
 ual labor of the able-bodied man is not less than $1,500 to 
 $2,000 per year, it will not be long before the ownership and con- 
 trol of the plants and machinery of important enterprises will 
 be distributed among all those who desire to assume the care 
 and responsibility of such management. Any business which 
 is protected by no special privilege and which is open to all on 
 equal terms will fall under one control whenever such business 
 is conducted with superior management, presenting cheaper 
 and more ready service than any of its competitors. In such 
 case the economies of management do not result in paying 
 unusual dividends, but in cheaper goods. In this kind of 
 monopoly all share. The management which controls the busi- 
 ness acts as the servant of the public. Competition will reduce 
 the profits, when excessive, to the normal condition. Under 
 conditions of equal freedom, ability, whether individual or 
 associated, cannot exert itself in withholding opportunities. 
 That is the only way by which now and in the past the inferior 
 have been exploited or robbed by the euperior, the shrewd, 
 cunning and unscrupulous. Ability can then only exert itself 
 in some productive act, some service to the community.
 
 An Exposition of the Single Tax. 133 
 
 Among some superficial writers who follow the leadership 
 of Edward Bellamy marked inability exists to distinguish 
 between land as a natural element, the value which attaches 
 to land and special privileges which are capitalized and sold as 
 marketable commodities, and real capital. Capital in an eco- 
 nomic sense is wealth, i. e., a product of labor, which is devoted 
 to the production of more wealth, or, as Henry George defines 
 it, "Capital is wealth in the course of exchange." Although a 
 man who owns much land, notes and valuable privileges is 
 accounted wealthy, this kind of property is not wealth. Land 
 is not wealth, although exchangeable for wealth, but an oppor- 
 tunity of producing wealth. The valuable slave was not 
 wealth in an economic sense, although wealth in a commercial 
 sense. Much of what now passes for wealth in our markets j 
 is merely unjust rights and privileges which the single tax 
 will abolish and render valueless. 
 
 True wealth, in an economic sense, is the result of the 
 application of labor to the natural bounties of the earth. As 
 such it is perishable ; nature wages incessant war against it. ' 
 Let human labor cease throughout the entire world for but a few 
 days, and millions would perish. Let it cease for a few years, 
 and little would remain to mark the ruin of the race. The 
 owners of capital as such possess no monopoly. The posses- 
 sions of the wealthy are perishable and require constant care. 
 The ownership of tangible wealth is not the security of the 
 rich, but the land and special privileges which they possess, for 
 which they can always command a return from the productive / 
 labor of others. 
 
 " What," says Henry George, " does God Almighty give to 
 man, but the power to labor and land ! " Land is the physical 
 basis of life ; the essential condition of the exercise of all pro- 
 ductive labor. 
 
 The selfish instinct which in its proper field is just and 
 natural is thus made to harmonize with the highest expression 
 of " altruism," for in a well ordered society, associating under 
 conditions of equal freedom, the struggle for self assumes the 
 concrete form of a struggle for others. It is only as the others 
 will gain by the individual effort, and to the extent of that gain,
 
 134 An Exposition of the Single Tax. 
 
 that the individual effort will become profitable. The single 
 tax philosophy is the logical development of the saying of Tur- 
 got over one hundred years ago. A caricature of this is what 
 is represented under the name of "Laissez faire" or "Let 
 alone." The single- taxers do not say to the state, "Hands 
 off ," but " CLEAR THE WAYS!" that is, remove special privi- 
 leges, throw open the natural bounties by the single tax upon 
 land values, take possession of the highways, and then "LET 
 THINGS ALONE!" 
 
 XII. THE SINGLE TAX AND ANCIENT LAW. 
 
 The single tax is but the application to the conditions of 
 modern life of the fundamental principles of justice which 
 everywhere have been recognized by ancient law and by the 
 great law-givers of the past. This is particularly noticeable 
 in the Mosaic code. Moses knew well what would become 
 of the poor, the less favored in shrewdness and cunning, when 
 divorced from land. Learned in all the wisdom of the Egyp- 
 tians, a civilization not unlike what ours is rapidly tending to 
 be, and which had fallen into a condition of monopoly-ridden 
 servitude, by failing to harmonize the necessity of exclusive 
 possession with the common right of all to land, Moses provid- 
 ed that the land of his people should be apportioned to tribes 
 and to families for their inheritances. These inheritances 
 were inalienable. 
 
 "The land shall not be sold forever : for the land is mine ; 
 for ye are strangers and sojourners with Me" Leviticus 
 25 : 23. 
 
 But these inheritances could be leased from jubilee to 
 'ubilee, 49 years, and for shorter periods, every lease termin- 
 ating at the same time, and the landless were restored to 
 their family inheritance. Every seven years all debts not, 
 paid were released at the same time. So that there could 
 neither be a landless nor a debtor class permanently among 
 them. Among no class of people has labor been more highly 
 esteemed than in this ancient and only national democracy f 
 in the economic sense, which the world has yet seen. The 
 primitive institutions of all races established in eome form 
 common right in land. Among the ancient German people
 
 An Exposition of the Single Tax- 135 
 
 the land was re-divided every two years. Some traces of this 
 custom still exist in English law. Under the feudal system 
 land ownership was contingent upon return to the state of 
 what is now equivalent to taxes. The recent decision of the 
 United States Supreme Court in the Lake Front cases, that 
 the right of the people to the navigable waters of Lake 
 Michigan could not be inalienated even by the Legislature of 
 Illinois, is the enfeebled and decrepid form in which has come 
 down to us the ancient doctrine that the right of all the peo- 
 ple to the more valuable land which is not under, water is 
 inalienable. 
 
 XIII. THE SINGLE TAX AND OVER-POPULATION. 
 
 The college professors and their allies, the defenders of all 
 existing monopolies and unjust laws, whose business it is to 
 obscure the most simple matters, say that population tends to 
 outstrip the means of subsistence. This pernicious teaching, 
 which attempts to unload the results of unjust laws upon an 
 imagined " niggardliness of Nature," as one writer puts it, is 
 very satisfactory to the privileged classes, who affect to see in 
 the persistence of poverty, and the increase of those who can 
 find no satisfactory or profitable employment, the manifesta- 
 tion of an inevitable consequence of the natural increase of the 
 population. So-called men of science, possessing a slight 
 acquaintance with the theory of evolution, point out the extraor- 
 dinary productiveness of organisms, animal and vegetal, and 
 conclude that the consequences of the tendency to increase of 
 low-grade organisms applies in the same manner to man. The 
 fecundity of the lower forms of life, however, is a source of 
 gain. None of these inferior creatures have the power to mod- 
 ify their surroundings to their own needs. By reason of his 
 intelligence the human animal is master over nature, and prof- 
 its both by the increase of his own species and by the fecund- 
 ity of others. 
 
 Some time ago a clergyman of local reputation addressed 
 the Chicago Single Tax Club on the necessity of restricting 
 emigration. After the address one of the members related 
 that some time ago he ate some caramels and shortly had a 
 severe toothache. Assuming that the trouble was due to the
 
 136 An Exposition of the Single Tax. 
 
 diseased condition of his teeth, and not to the presence of the 
 candy, per se, he went to a dentist and had his teeth filled. 
 " What ought I to have done, quit eating candy, or visited the 
 dentist ? " The clergyman said he should have stopped eating 
 the caramels if he could not have found a dentist. " But," 
 said he, " the services of the dentist were to be had, eating 
 the caramels accentuated their condition and indicated unmis- 
 takably that the teeth were in an unnatural and unhealthy 
 condition, and thereby gave warning that, unless a remedy was 
 applied, the teeth would be ruined. Now, if I had not eaten 
 the candy I would not have known the condition of my teeth. 
 By prompt attention to the real cause of the trouble I have 
 saved myself serious inconvenience and the utter destruction 
 of my teeth. Now, should we try to stop the natural increase 
 of the population, by immigration or otherwise, or intelligently 
 examine into the fundamental cause of which our so-called over- 
 population is only a superficial symptom. We have the single 
 tax as ready at hand as I had the dentist." 
 
 The professors assert the existence of two laws, viz.: 
 
 1. The Law of Increasing Returns. 
 
 2. The Law of Diminishing Returns. 
 
 The first of these, they affirm, applies only to the raw 
 materials that have already been extracted from the earth, 
 while the law of diminishing returns determines how great the 
 supply of these shall be; hence, they say, one can not neutral- 
 ize the other. 
 
 There is no department of human activity, unless it be the 
 teaching of political economy in our colleges, which has not 
 been invaded by the intelligence of the age. The introduction 
 of improved processes, scientific methods and labor-saving 
 machinery has been especially marked in the so-called "extract- 
 ive processes." It has been shown by competent statisticians 
 that in agriculture the labor of one man to-day will produce 
 greater results than that of twenty men fifty years ago.* 
 
 "Thus," says one who had carefully investigated this phase 
 of the subject, " one man with a harvester does the work of 
 
 *Wm. G. Moody: Land and Labor in the Unitod States. Edward 
 Atkinson: Distribution of Products. First Report, Commissioner 
 of Labor U. 8., called "Industrial Depressions."
 
 An Exposition of the Single Tax. 137 
 
 three hundred and twenty men sixty years ago. As compared 
 with fifty years ago, in ploughing, one man now does the work 
 of twenty-four; in seeding grain, one does the work of ten; in 
 corn-shelling, one does the work of one hundred and fifty. 
 There are machines that cut, thresh and winnow the grain at 
 one operation. Four men with one of these machines do the 
 work formerly requiring three hundred men." * 
 
 These economies in extractive processes were effected in 
 this country while yet there remained vast areas of govern- 
 ment land subject to settlement at nominal cost. Present 
 methods of cultivation will undoubtedly be superseded by a 
 more intensive culture which will yield larger returns. The 
 experiments of Prince Krapotkine, near Paris, France, have 
 developed the possibilities of intensive culture. Upon an acre 
 and one-half of ground he employs sixty-five men profitably. 
 
 The land of the United States available for agriculturei 
 mining, fisheries and other extractive processes is only used to 
 a small extent. One authority says that only one-eighth of 
 such land is in use. For all practical purposes the possibility 
 of over-population is as remote from reasonable consideration 
 as the day when the earth, by dissipation of its internal heat, 
 shall become uninhabitable. When opportunities are equal 
 the benefits of association are shared by all in exact proportion 
 to their industry and ability. The more numerous the popula- 
 tion the greater the return to the individual laborer. If a gen- 
 eral and permanent rise in wages were to attract to the United 
 States the population of the old world, the result must inevita- 
 bly be to effect greater economies in production, which, under 
 the single tax, would increase the return to labor and industry. 
 
 Some Apt Quotations. 
 
 "Th earth is the common property of all men." Pope 
 Gregory the Great. 
 
 "No man made the land; it is the original inheritance of 
 the species." John Stuart Mill. 
 
 "The original deeds were written with the sword rather 
 than with the pen." Herbert Spencer. 
 
 *Econ6mic Conferences, Chicago, Fourth Session, March 10. 
 1889. Address by Jesse Cox.
 
 138 An Exposition of the Single Tax. 
 
 "The greatest discovery of my life is that the men who do 
 the work never get rich." Andrew Carnegie. 
 
 "The earth belongs in usufruct to the living; the dead 
 have no right or power over it." Thomas Jefferson. 
 
 "The great spirit has told me that the land is not to be 
 made property. The earth is our mother." Black Hawk. 
 
 "Whilst another man has no land my title to mine, your 
 title to yours, is at once vitiated." Ralph Waldo Emerson. 
 
 "From this one great fundamental wrong [landlordism] 
 flow want and misery and vice and shame." Henry George. 
 
 "The reserved rights of the people to the rental value of 
 land must be construed as a condition to every deed." United 
 States Supreme Court. 
 
 "There is no foundation in nature, or in natural law, why 
 a set of words upon parchment should convey the dominion of 
 land." Sir William Blackstone. 
 
 "The ideal taxation lies in the single land tax, laid upon 
 the rental value of land, independent of improvements." New 
 York Times, January 10, 1890. 
 
 "The land of every country is the common property of the 
 people of that country, because the creator made it as a volun- 
 tary gift to them." Right Rev. Nulty, Bishop of Meath. 
 
 "To deprive others of their right to the use of the earth is 
 to commit a crime only inferior in wickedness to the crime of 
 taking away their lives or personal liberties." Herbert 
 Spencer. 
 
 "The right of property, originating in the right of the in- 
 dividual to himself, is the only full and complete right of 
 property. It attaches to things produced by labor, but can- 
 not attach to things created by God." Henry George. 
 
 "He who is capable of devising a system by which the ex- 
 penses of the government shall be limited to its reasonable ne- 
 cessities and its burdens distributed so that they shall be 
 fairly or justly apportioned among all our people, will prove a 
 benefactor to his race and deserve the gratitude of all." Gov. 
 Boies, in inaugural address of 1892. 
 
 "The simple yet sovereign remedy, which will raise wages, 
 increase the earnings of capital, extirpate pauperism, abolish
 
 An Exposition of the Single Tax. 139 
 
 poverty, give remunerative employment to whosoever wishes 
 it, afford free scope to human powers, lessen crime, elevate 
 morals and taste and intelligence, purify government and carry 
 civilization to yet nobler heights is to appropriate [ground] 
 rent by taxation." Henry George. 
 
 The Single Tax Platform. 
 
 The following platform was adopted by the National Con- 
 ference of the Single Tax League of the United States at 
 Chicago, August 30th, 1893: 
 
 We assert as our fundamental principle the self-evident 
 truth enunciated in the Declaration of Independence that all 
 men are created equal and are endowed by their Creator with 
 certain inalienable rights. 
 
 We hold that all men are equally entitled to the use and 
 enjoyment of what God has created and of what is gained by 
 the general growth and improvement of the community of 
 which they are a part. Therefore, no one should be permitted 
 to hold natural opportunities without a fair return to all for 
 any special privilege thus accorded to him, and that value 
 which the growth and improvement of the community attach 
 to land should be taken for the use of the community. 
 
 We hold that each man is entitled to all that his labor 
 produces. Therefore no tax should be levied on the products 
 of labor. 
 
 To carry out these principles we are in favor of raising all 
 public revenues for national, State, county and municipal pur- 
 poses by a single tax upon land values, irrespective of improve- 
 ments, and of the abolition of all forms of direct and indirect 
 taxation. 
 
 Since in all our States we now levy some tax on the value 
 of land, the single tax can be instituted by the simple and easy 
 way of abolishing, one after another, all other taxes now levied, 
 and commensurately increasing the tax on land values, until 
 we draw upon that one source for all expenses of government, 
 the revenue being divided between local governments, State 
 governments and the general government, as the revenue from 
 direct taxes is now divided between the local and State gov- 
 ernments; or, a direct assessment being made by the general 
 government upon the States and paid by them from the rev- 
 enue collected in this manner. 
 
 The single tax we propose is not a tax on" land, and there- 
 fore would not fall on the use of |land and become a tax on 
 labor. 
 
 It is a tax, not on land, but on the value of land. Thus 
 it would not fall on all land, but only on valuable land, and on
 
 140 An Exposition of the Single Tax. 
 
 that not in proportion to the use made of it, but in proportion 
 to its value the premium which the user of land must pay to 
 the owner, either in purchase money or rent, for permission to 
 use valuable land. It would thus be a tax, not on the use and 
 improvement of land, but on the ownership of land, taking what 
 would otherwise go to the owner as owner, and not as user. 
 
 In assessments under the single tax all values created by 
 individual use or improvement would-be excluded, and the only 
 value taken into consideration would be the value attaching to 
 the bare land by reason of neighborhood, etc., to be determined 
 by impartial periodical assessments. Thus the farmer would 
 have no more taxes to pay than the speculator who held a sim- 
 ilar piece of land idle, and the man who, on a city lot, erected 
 a valuable building would be taxed no more than the man who 
 held a similar lot vacant. 
 
 The single tax, in short, would call upon men to contribute 
 to the public revenues, not in proportion to what they produce 
 or accumulate, but in proportion to the value of the natural 
 opportunities they hold. It would compel them to pay just as 
 much for holding land idle as for putting it to its fullest use. 
 
 The single tax, therefore, would 
 
 1. Take the weight of taxation off the agricultural dis- 
 tricts, where land has little or no value irrespective of improve- 
 ments, and put it on towns and cities, where bare land rises to 
 a value of millions of dollars per acre. 
 
 2. Dispense with a multiplicity of taxes and a horde of 
 taxgatherers, simplify government, and greatly reduce its cost. 
 
 3. Dp away with the fraud, corruption and gross ine- 
 quality inseparable from our present methods of taxation, 
 which allow the rich to escape while they grind the poor. 
 Land cannot be hid or carried off, and its value can be ascer- 
 tained with greater ease and certainty than any other. 
 
 4. Give us, with all the world, as perfect freedom of trade 
 as now exists between the States of the Union, thus enabling 
 our people to share, through free exchanges, in all the advan- 
 tages which nature has given to other countries, or which the 
 peculiar skill of other peoples has enabled them to attain. It 
 would destroy the trusts, monopolies and corruptions which 
 are the outgrowth of the tariff. It would do away with the 
 fines and penalties now levied on any one who improves a farm, 
 erects a house, builds a machine, or in any way adds to the 
 general stock of wealth. It would leave every one free to apply 
 labor 01 expend capital in production or exchange without fine 
 or restriction, and would leave to each the full product of his 
 exertion 
 
 5. It would, on the other hand, by taking for public use 
 that value that attaches to land by reason of the growth and 
 improvement of the community, make the holding of land un-
 
 An Exposition of the Single Tax. 141 
 
 profitable to the mere owner and profitable only to the user. 
 It would thus make it unprofitable for speculators and monop- 
 olists to hold natural opportunities unused or only half used, 
 and would throw open to labor the illimitable field of employ- 
 ment which the earth offers to man. It would thus solve the 
 labor problem, do away with involuntary poverty, raise wages 
 in all occupations to the full earnings of labor, make overpro- 
 duction impossible until all human wants are satisfied, render 
 labor-saving inventions a blessing to all, and cause such an 
 enormous production and such an equitable distribution of 
 wealth as would give to all comfort, leisure, and participation 
 in the advantages of an advancing civilization. 
 
 In securing to each individual his equal right to the use 
 of the earth it is also a proper function of society to maintain 
 and control all public ways for the transportation of persons 
 and property and the transmission of intelligence, and also to 
 maintain and control all public ways in cities for furnishing 
 water, gas and all other things that necessarily require the use 
 of such common ways. 
 
 A previous platform contained the following in place of 
 the last paragraph above and many prominent single-taxera 
 prefer this form: 
 
 With respect to monopolies other than the monopoly of 
 land, we hold that where free competition becomes impossible, 
 as in telegraphs, railroads, water and gas supplies, etc., such 
 business becomes a proper social function which should be 
 controlled and managed by and for the whole people con- 
 cerned, through their proper government, local, State or na- 
 tional, as may be. 
 
 What the Referendum Will Do. 
 
 It will simplify laws. It will simplify government. It 
 will kill monopoly. It will purify the ballot. It will sup- 
 plant violence. It will broaden manhood. It will prevent 
 revolution. It will make people think. It will accelerate 
 progress. It will banish sectionalism. It will sever party 
 bondage. It will abolish special privileges. It will wipe 
 out plutocratic dictation. It will reduce taxation to neces- 
 sity. It will prevent the bribery of law-makers. It will 
 establish home rule in all municipalities. It will restore to 
 the people their natural rights. It will aid honest repre- 
 sentatives in serving the people- It will give us a government 
 of the people, by the people, for the people, on a foundation 
 of equal and exact justice to all. John A. Wayland,
 
 In "No alms I ask; give me my task! 
 
 Here are the arm, the leg, 
 The strength, the sinews of a man, 
 To work, and not to beg." 
 
 TOM HOOD (Lay of the Laborer}. 
 
 CO-OPERATION. 
 
 JN the course of a series of lectures on Socialism and kindred 
 * subjects recently delivered in St. Louis, the Rev. W. W. 
 Boyd, of the Second Baptist Church of that city, presented 
 the results of a careful investigation of the subject of Co- 
 operation. The statistics of distributive co-operation in Great 
 Britain make a most interesting exhibit. The English "whole- 
 sale" annual business is now $50,000,000 a year. The total of 
 the reporting co-operative stores is 8250,000,000; the profits, 
 in excess of interest, $25,000,000; the membership, 1,400,000. 
 The total trade of co-operative stores in Great Britain from 
 1861 to 1890, inclusive, was $2,743,436,440, and the profits in 
 excess of "interest, $233,059,495. 
 
 In the United States the Puritan settlements early gave a 
 practical training in the spirit of co-operation, and in the first 
 industry, that of the fisheries, the form of co-operation followed 
 which has continued, especially in Maine, to the present. 
 Brook Farm, Hopedale and other associations in the decade of 
 1840-50 were communistic as well as co-operative, and therein 
 lay their weakness. The Workmen's Protective Union, 1850, 
 the Patrons of Industry (or the Grange) and similar organiza- 
 tions, though co-operative, failed because they did not grasp 
 the true principle of co-operation. Yet out of the experience) 
 agitation and education of those forty years the principles of 
 true co-operation are beginning to be understood and put in 
 practice. 
 
 The popular notion of a co-operative store has been for a 
 few persons to subscribe a small capital, buy at the lowest 
 wholesale prices a stock of goods and sell to the members 
 at cost and perhaps on credit, thus cutting the prices of retail 
 traders. The failure of so many so-called co-operative stores 
 
 142
 
 Co-operation. j.*3 
 
 in this country is due to this total misconception of what co- 
 operation is. The same thing occurred in England for half a 
 century, until in 1844 the Rochdale weavers discovered the 
 true principle that must lie at the basis of all successful co- 
 operative enterprise namely, the feeding of co-operation on 
 its profits. The principal features of the Rochdale system, 
 which has proved successful wherever adopted, are these: 
 Each member of the co-operative society is limited to one vote 
 in choosing directors to conduct the business. Only goods of 
 standard quality and in constant demand are bought. All 
 goods are sold for cash, no credit being given, at the regular 
 retail prices. A record is kept of purchases, and the profits f 
 after deducting interest and a certain portion for the reserve 
 funds, are divided quarterly, not on the shares, as in a joint 
 stock company, but on the amount of purchases each has 
 made. The dividend, or rebate, received by each purchaser is 
 placed to his credit against further shares of the capital stock, 
 or paid to him in cash, as he desires. Thus the savings are 
 constantly invested in the business, and it is this feeding on 
 profits that gives co-operation capital and stability. 
 
 In co-operative production we find that cheese factories 
 and creameries for the manufacture of butter are an estab- 
 lished success. Of 150 creameries in New England, 80 per 
 cent, are co-operative. In the Central and Western States one- 
 fourth of the whole number are so. In the Northwestern and 
 Middle States one-half of the cheese factories are co-operative. 
 Sixty per cent, of the cheese made in factories in the United 
 States is the product of co-operative effort. The significance 
 of these statements is seen if we add that the dairy production 
 of the United States is annually 610,000 tons, or about one- 
 third of the world's product, and that our exports for 1889-92, 
 inclusive, were 75,487,380 pounds of butter and 344,609,978 
 pounds of cheese, a total value of more than 839,000,000. At 
 least one-half of this value was the result of co-operation. 
 
 Co-operative manufacturing is the most difficult form of 
 co-operation, yet Mr. Boyd has gathered the statistics of forty 
 such establishments in this country, the managers of which 
 speak of the system in praise.
 
 144 Co-operation. 
 
 Building and Loan Associations. 
 
 Originating in Philadelphia in 1831, building and loan 
 associations are now to be found in most of the States. In 
 Pennsylvania, it is said, the people have saved through them 
 $60,000,000, and nearly 100,000 homes in that city have thus 
 been paid for. Commissioner Wright says that, though the 
 average age of all these associations is but 6.2 years, there are 
 in the United States 5,838 of them, with 1,745,725 shareholders, 
 having net assets of $450,667,594. The total profits have been 
 180,664,116. He estimates that by this agency there bave been 
 built in this country nearly 400,000 homes. Bradstreet's re- 
 ports that the aggregate resources of these co-operative savings 
 associations of the country are nearly 60 per cent, of the entire 
 assets of all State, savings, loan and trust companies and 
 private banks and bankers from whom reports were received 
 in 1890. Their deposits were less than 10 per cent, below those 
 of the national banks and were more than twice as large as the 
 total stock of the national banks. 
 
 On this showing Mr. Boyd comes to the conclusion that in 
 building and loan associations co-operation has won its most 
 signal euccess. And yet they are not an unmixed blessing. 
 The writer believes that there are two sides to this question 
 in fact, that these associations do not at all represent the true 
 principles of co-operation. And the reason is that not all the 
 members borrow, and those who do not have a decided ad- 
 vantage over those who do, in that they get the lion's share of 
 the profits accruing from the usurious rates of interest which 
 prevail. The nominal rate of interest is generally 7 per cent., 
 but as a usual thing money loaned by building and loan asso- 
 ciations is put up at auction, the member bidding the largest 
 premium getting the loan. The premium is never less than 20 
 per cent., often as high as 35 per cent. and this is always de- 
 ducted from the loan. Thus a borrower paying interest, on, 
 say, $2,000, may not have received in reality more than $1,300, 
 at most $1,600. If $1,300, even if the nominal rate of interest is 
 only 6 per cent., he really pays at the rate of over 9 per cent. 
 If the nominal rate is 7 per cent., he really pays nearly 11 per 
 cent. Under the most favorable circumstances the interest
 
 Co-operation. 145 
 
 will be at least one-third higher than prevailing rates. Many 
 business men, realizing this, invest largely in the stock of 
 building and loan associations, but would not think of borrow- 
 ing from them. When they do borrow they make a straight 
 loan elsewhere, timing the loan so that it comes due after 
 their stock matures. <%, 
 
 HOW TO CO- OPERA TE. 
 
 ONE of the greatest, because one of the most active and suc- 
 cessful and, above all, one of the most unselfish workers in 
 the cause of Reform is John A . Wayland, formerly of Green- 
 field, Ind., and now of Tennessee City, Tenn., where he is the 
 guiding spirit of the flourishing co-operative colony of Ruskin. 
 His paper, The Coming Nation, all of the profits of which he 
 devotes to his philanthropic enterprise, is one of the brightest 
 examples of originality in journalism. No man living is better 
 qualified to speak on the subject of co-operation. He says: 
 
 I may not Jay claim to either the age or wisdom to advise 
 my brother workers what to do, but if you will consider some 
 of my suggestions relative to your actions and surroundings, 
 and talk them over among yourselves, I am sure you will be 
 able to find the world brighter to you. You seldom, if ever, 
 give any serious thought to bettering your condition except by 
 hoping for better wages. Your ideals begin and end with 
 "wages," and so long as that be true there is no possibility of 
 your condition being bettered. You mistrust your fellow 
 workmen, never give or receive their confidence, and are afraid 
 of trying to help yourselves by mutual exertion. You may 
 say you also mistrust the employing classes, but you act on 
 their advice and suggestion every time. You say that one of 
 you is dishonest, another lazy, and so on, and they have a like 
 opinion of you; when, if you were to go to them as a brother, 
 take them into your confidence and unfold to them some plan 
 you have thought out honestly of making more wealth, or retain- 
 ing that you do create, I am sure under many ragged coats you 
 will find true hearts willing to help you, and minds capable of 
 great and noble deeds. It only lacks this expression of confi- 
 dence to bring out their nobility and yours also. Whoever 
 speaks to a workman about bettering his condition except on 
 terms that take the larger share while the laborer takes all 
 the chances of loss? No one will help you on really just terms. 
 You must learn to help yourselves. I never felt this more 
 than while reading how thirteen poor weavers and shoemakers 
 in Rochdale, England, met and talked over how to better their
 
 146 Co-operation. 
 
 condition. They did not have a shilling, but they laid away 
 two-pence (four cents) a week from their scanty wages and be- 
 gan to create a fund. In time they got a few more with them. 
 At the end of a year they had 28. They bought coffee, 
 sugar, tea and oatmeal with it, placed it in a room of one 
 of them and sold it to themselves at the retail price, saying the 
 dealer's profit. They did this at night, that they might not 
 lose time. This grew, and new members were admitted, but it 
 was seven years before the store was finally opened during the 
 day. This was the beginning of a system that has to-day 
 2,000 retail stores, great warehouses, factories and workshops, 
 ships, all owned by the very workers who are employed in 
 these institutions, each having only a small share of stock, but 
 dividing the profits among them. They do a business of hun- 
 dreds of millions of dollars annually. It has not only placed 
 them above the power of British capitalists to make profits out 
 of their toil, but it has done more. It has developed some of 
 the noblest, purest characters in England. It has elevated 
 thousands of working people from degraded conditions to self- 
 reliant men and women. It is an example worthy to be fol- 
 lowed by all working people. Are you Americans less noble? 
 Are you less independent? Have you the mettle to meet and 
 overcome your ills? Are you capable of recognizing some of 
 the good in you as you do some of the bad in you? Are you 
 worthy of better treatment than you are receiving? If you 
 are, go to work. Take each other into frankest confidence, 
 talk over plans, and when you have carefully considered and 
 decided on some course, pursue it with a determination and 
 vigor that means success. If some drop by the wayside, stop 
 not. Keep your eyes on the goal, your heart true to truth, 
 and all the powers of capitalism and its combines will give 
 way before you. You have never tried to help yourselves, and 
 are therefore helpless. Every obstacle met and overcome will 
 make you stronger. There is no victory where there,.is noth- 
 ing to conquer. 
 
 You say you can do nothing for the lack of ready cash? 
 More helpless than a Hottentot, who don't use money. Well, 
 I have been studying how to help you out of your troubles, by 
 using the means you have learned something about. If you 
 were not so ignorantly selfish and suspicious of each other, 
 you would not need to adopt such methods, but as you are, I 
 will lay down a plan that will give you all the capital you want 
 without debt or interest, and which will be strictly in conform- 
 ity with the letter and spirit of the laws. 
 
 Let a dozen or twenty men and women incorporate a com- 
 pany under State laws to buy and sell real estate, build 
 houses, and engage in merchandising and manufacturing, as 
 theincorporators may desire. Capitalize say at $50,000, diyided
 
 Co-operation. 147 
 
 into 5,000 shares of 810 each. Have the stock certificates neat- 
 ly engraved, with blank spaces for name of purchaser and for 
 signing up by the officers, and have them about the size of a 
 bank note. Issue with each certificate, which should represent 
 but one share, a blank proxy, or print it on the back and have 
 the purchaser sign it and also sign his name on the back in 
 the blank for transfer. Then each share will be the property 
 of the holder. Then you have 5,000 810 certificates of stock, 
 which will act as so much money if handled in the following 
 manner: Pay no officer any salary, so purchasers will know 
 that the assets will not be eaten up that will pay you in the 
 future. Then find some man who has a non-productive vacant 
 lot and who will take stock for it. Then find some man who 
 has stone that he will give for stock, using time that he would 
 otherwise be idle. Pay the quarrymen, the masons, the brick- 
 makers, the carpenters, the plasterers, the lime-makers, etc.. 
 allowing each to use material and labor that would not be em- 
 ployed, and soon you will have a house ready, all done by time 
 that would have otherwise been idle and forever lost. When 
 the house is ready rent it to one of the stockholders, who will 
 make the best tenant, for he will have an interest in the house 
 as a partial owner. Then repeat it, and soon the rent of the 
 houses will pay an interest on the stock, for there will be no 
 more stock issued than is actually represented by the houses. 
 Whenever you can pay a dividend of 3 per cent, on these 
 shares they will pass at par and you will find them circulating 
 from hand to hand like so many $10 bills, and you will have an 
 abundance of money to transact your business. You can 
 build a store building and gradually accumulate a stock of 
 goods, and each stockholder will patronize that store because 
 he is an owner in it. You can also erect factories and employ 
 the stockholders. The more people you can get to take this 
 stock for labor or material the stronger your corporation will 
 be, and the more stable will be the stock. By employing none 
 but stockholders, who can thus find a place to create wealth on 
 their idle days, you will compel in a measure all the citizens to be 
 stockholders. Thus you can transform all your idle labor, idle 
 land and idle materials into use and profit, and go on to an un- 
 limited extent, and by paying 3 per cent, dividends (to your- 
 selves) you will not grow poorer, as would be the case if the 
 interest went to New York. Besides, the money shark could 
 not get possession of that stock without giving value received. 
 As it now is, he prints stock that costs him nothing and you 
 pay him a large interest on that. When you have shown that 
 you are entitled to confidence by your management, you can, 
 by joining with other such companies, build great factories, or 
 even railroads.
 
 148 Co-operation. 
 
 Now don't sit around like children Baying you can do noth- 
 ing,but go to work and use these methods which capitalists use 
 to rob you. They can be operated anywhere, but especially in 
 email communities where land is cheap and where there is 
 building material handy. 
 
 The modus operandi of beginning and operating a store, 
 on the principles which have every time been successful, I will 
 outline for you as follows: Get many working people to sub- 
 scribe $50 for one share of stock, to be paid, if cash down is 
 impossible, say $5 at time of subscribing and $1 per week 
 thereafter until the stock is fully paid up. Great care should 
 be taken to get no quarrelsome or vicious members. Much 
 will depend on that. New members should be proposed and 
 voted on by the society before admission. As soon as capital 
 enough is in hand, rent a building and lay in a stock of goods. 
 Get the best and most sincere co-operator as salesman. Neither 
 buy nor sell one cent's worth on credit. Keep an accurate set 
 of books showing purchases of stock and sales. Have meet- 
 ings of all stockholders quarterly, at which officers shall make 
 their report, in which shall be specified the amount of funds 
 and value of stock possessed by the company. After the rent, 
 help, etc., are paid, the profits should be divided as follows: 
 5 per cent, on all shares paid up previous to the quarterly 
 meeting; the remainder to be divided amongst the members 
 in proportion to the amount of their purchases at the store 
 during the quarter. This is done by giving each member a 
 book in which the amount of each purchase is entered, or by 
 having metal or printed chips of 5c, lOc, 25c and $1, and giving 
 one of them with each purchase equal to the amount. The 
 bookkeeper should aslo tally these. Thus the total sales, if 
 nobody but members purchased, would equal the number of 
 these checks or books brought in on the last day of the quarter. 
 The cash and these chips or books must tally. Sales to out- 
 eiders would swell the profits to shareholders. By this means 
 the co-operators buy goods at wholesale prices, plus actual ex- 
 pense of conducting business. Fifty dollars to a family will 
 furnish all the capital needed in business. If shareholders do 
 not wish to draw their profits at the end of the quarter, or any 
 part of it, and more capital can be used to advantage, pay 
 them 4 per cent, on such sums, and the company thus becomes 
 a savings bank, as all stores in England are. In this country, 
 the company could be organized as a stock company or under 
 the building association laws, as thought best, but the stock 
 should be so limited as to allow but one or two shares to one 
 person, and the company should always stand ready to pay the 
 face value for any share of stock, and thus keep control of it 
 in desirable hands. All instances where capitalists, except 
 such as were sincere co-operators, were permitted to have a
 
 Co-operation. 1*9 
 
 nand in the management, failed of good results. It is desir- 
 able to own your own store-building, and this can easily be 
 done in America, where land is cheap and titles easy of trans- 
 fer. Mechanics among co-operators can easily build in days 
 of idleness, and material can be purchased by loans at 4 per 
 cent, as above specified. The business should be under the 
 control of a large board of directors. By-laws to bring about 
 these results can be easily drafted. I have outlined above 
 enough to show you how to proceed. Tracts showing work- 
 ing people the advantages to be derived by co-operat\on 
 should be circulated, and that will stimulate interest. When 
 several stores have been started, by acting together in pur- 
 chases, great benefits can be obtained that even large retail 
 stores cannot have. If twenty stores were in operation they 
 could import coffee, sugar and many articles and get them 
 cheaper than jobber and wholesaler, whose profits are now 
 added. The Rochdale stores do this. 
 
 "THOU, too, sail on, O Ship of State! 
 Sail on, O Union, strong and great! 
 Humanity, with all its fears, 
 With all the hopes of future years, 
 Is hanging breathless on thy fate! 
 We know what Master laid thy keel, 
 What Workman wrought thy ribs of steel, 
 Who made each mast, and sail, and rope, 
 What anvils rang, what hammers beat, 
 In what a forge and what a heat 
 Were shaped the anchors of thy hope! 
 Fear not each sudden sound and shock, 
 'Tis of the wave and not the rock; 
 'Tis but the flapping of the sail, 
 And not a rent made by the gale! 
 In spite of rock and tempest's roar, 
 In spite of false lights on the shore, 
 Sail on, nor fear to breast the sea! 
 Our hearts, our hopes, are all with thee, 
 Our hearts, our hopes, our prayers, our tears, 
 Our faith triumphant o'er our fears, 
 Are all with thee, are all with thee!" 
 
 Longfellow. 
 
 "!F I were a young man, I should ally myself with some 
 high and at present unpopular cause, and devote my every 
 effort to accomplishing its success." John <?. Whittier.
 
 |n "No people can be self-governing who are denied the right 
 to vote ' yes" 1 or 'no 1 on every law by which they are to be 
 governed" 
 
 DIRECT LEGISLATION. 
 
 ^ 
 
 The Initiative and Referendum. 
 
 'pHE Initiative gives the people the power to compel the 
 * legislature to put in form all such laws as they may initi- 
 ate or demand by a preliminary vote. 
 
 The Referendum permits all legislative enactments to be 
 referred to the people for their ratification by vote before they 
 become laws. 
 
 The Imperative Mandate gives the people the right to vote 
 out of office at any time men who fail to serve the public or 
 who are untrue to their pledges. 
 
 Proportional Representation secures the representation 
 of all parties in proportion to their numerical strength. 
 
 Representative Government means government by repre- 
 sentatives elected by the people, but independent of the people 
 after election and empowered to ignore or overrule the people's 
 will. 
 
 Popular Government, or democracy, means government 
 of, for and by the people. It will be possible only when all 
 officeholders are honest or when the people's representatives 
 are made subject to the people's will by the adoption of the 
 referendum. 
 
 There is a radical difference between a democracy and a 
 representative government. Whenever a people are qualified 
 for self-government no power on earth can prevent them from 
 exercising that right. The American people have been too 
 busy "making money" to study their real economic needs, and 
 the result is that irresponsible demagogues have made laws 
 which have plunged the nation into almost hopeless debt, par- 
 alyzed its business and impoverished most of the people. The 
 voters have several times of late risen in their wrath and 
 
 150
 
 Direct Legislation. 151 
 
 " turned the rascals out," but it was only to elect another set 
 of rascals, of different political complexion, perhaps, but equally 
 dishonest and equally irresponsible. The so-called "landslides" 
 in recent elections, however, indicate that the people have 
 begun to think. Soon they will realize that they can control 
 their own government only by keeping the legislation in their 
 own hands that they must not delegate their sovereignty to 
 representatives or servants, by whatever name they may be 
 known. It is only by means of the initiative and the referen- 
 dum that the people can maintain their supremacy. The gen- 
 eral adoption of this system is the next step in the world's 
 progress. The initiative and referendum will take the element 
 of partisanship out of the settlement of economic questions, 
 and this alone is sufficient reason why it should be adopted. 
 Suppose the question of tariff were submitted to the people to 
 vote on. Members of all parties would vote for it and against 
 it, and the majority would decide. It would become a ques- 
 tion of economics, not a partisan issue, and would be settled 
 on its merits. The same with the free coinage of silver, paper 
 money, public ownership of railroads, prohibition, and every 
 other great question which the gold political parties have 
 straddled or evaded. 
 
 But the principal advantage of the referendum is that it 
 would do away entirely with the lobby "the third house." 
 There would be no inducement for any one to bribe the law- 
 makers. They might sell their individual votes, but these 
 would be worthless, as only the people could "deliver the 
 goods." The people would be quick to see the value of the 
 franchises and privileges which are now being practically 
 given away, to be used by corporations to still further 
 enslave the masses. 
 
 Switzerland is the home of the referendum. It is com- 
 monly believed that that republic has existed for six hundred 
 years. The fact, however, is that it is the youngest of repub- 
 lics. The characteristic features of the government, those 
 which make it a republic in fact as well as in name, were insti- 
 tuted by the present generation. It is the only country in the 
 world to-day which has overthrown its plutocracy and which
 
 152 Direct Legislation. 
 
 has made it impossible for corrupt politicians to rule the peo- 
 ple through the representative system. To the principle of 
 direct legislation, as carried out by the initiative and referen- 
 dum, must be ascribed the happy conditions which surround 
 its politics/ Mr. W. D. McCrackan, author of "The Rise of the 
 Swiss Republic," who has made a special study of the subject, 
 has published in the Arena his observations of Swiss politics. 
 He finds that, as a result of the referendum, jobbery and 
 extravagance are unknown and that politics, as there is no 
 money in it, has ceased to be a trade. Office-holders are taken 
 from the ranks of citizenship and are invariably chosen 
 because of their fitness for the work. The people take an 
 intelligent interest in the legislation, local and federal, and are 
 fully imbued with a sense of their political responsibilities. 
 The Westminster Review, February, 1888, speaking of the 
 referendum, expresses this opinion : 
 
 " The bulk of the people move more slowly than their rep- 
 resentatives, are more cautious in adopting new and trying 
 legislative experiments and have a tendency to reject proposi- 
 tions submitted to them for the first time. . . . The issue which 
 is presented to the sovereign people is invariably and necessa- 
 rily reduced to its simplest expression and so placed before 
 them as to be capable of an affirmative or negative answer. In 
 practice, therefore, the discussion of details is left to the rep- 
 resentative assemblies, while the public express approval or 
 disapproval of the general principle or policy embraced in the 
 proposed measure. Public attention being confined to the 
 issue, leaders are nothing. Collective wisdom judges of mer- 
 its." 
 
 In some of the cantons of Switzerland the referendum has 
 been in practice since the sixteenth century. As it is now 
 employed it was adopted by the canton of St. Gallon in 1830 
 and in 1848 it was incorporated in the Swiss federal constitu- 
 tion. It has been so extended since then that it is now in 
 operation in all the Swiss cantons except Freiburg. 
 
 According to the Swiss constitution all amendments thereto 
 must be ratified by the Swiss electors before they become 
 effective. Other measures, like ordinary enactments, must be 
 submitted to a popular vote if a demand is made for such 
 submission, written ninety days after their publication. This
 
 Direct Legislation. 153 
 
 demand must be made by 30,000 voters or by the government 
 of eight of the nineteen entire and six half cantons. In Swit- 
 zerland the referendum has proved to be entirely satisfactory 
 as a check upon hasty or class legislation. 
 
 As to the practical working of the referendum in Switzer- 
 land Albert Bushnell Hart says : 
 
 "A judgment of the referendum must be based on the 
 working of the electoral machinery, on the interest shown by 
 the voters, and on the popular discrimination between good 
 and bad measures. The process of invoking and voting on a 
 referendum is simple and easily worked, if not used too often 
 Although the assembly has, in urgent cases, the constitutional 
 right to set a resolution in force at once, it always allows from 
 three to eight months' delay so as to permit the opponents of 
 a measure to lodge their protests against it. Voluntary com 
 mittees take charge of the movement, and, if a law is unpopu 
 lar, little difficulty is found in getting together the necessary 
 30,000 or 50,000 signatures. Only thrice has the effort failed 
 when made. When, as in 1882, the signatures run up to 180,000 
 the labor is severe, for every signature is examined by the 
 national executive to see whether it is attested as the sign 
 manual of a voter ; sometimes, in an interested canton, as 
 many as 70 per cent, of the voters have signed the demand 
 The system undoubtedly leads to public discussion ; newspa 
 pers criticise; addresses and counter addresses are issued; can- 
 tonal councils publicly advise voters, and of late the federal 
 assembly sends out manifestoes against pending initiatives. 
 The federal executive council distributes to the cantons enough 
 copies of the proposed measure so that one may be given to 
 each voter. The count of the votes is made by the executive 
 council as a returning board. Inasmuch as the Swiss are 
 unfamiliar with election frauds, and there has been but one 
 very close vote in the national referenda, the count is not diffi- 
 cult, but there are always irregularities, especially where more 
 than one question is presented to the voters at the same time. 
 
 " What is the effect of the popular votes thus carried out? 
 The following table, based on official documents, shows the 
 results for the twenty years 1875-1891: 
 
 Passed, Rejected. Total 
 
 1. Constitutional amendments proposed 
 by the assembly ^referendum obliga- 
 tory) 16 7 
 
 2. Constitutional amendments proposed 
 by popular initiative (50,000 signa- 
 tures) 2 1 *4 
 
 3. Laws passed by the assembly (refer-
 
 154 Direct Legislation. 
 
 endum demanded by 30,000) 14 6 20 
 
 17 13 31 
 
 "Making allowances for cases where more than one ques- 
 tion has been submitted at the same time, there have been 
 twenty-four popular votes in twenty years. In addition, most 
 of the cantons have their own local referenda; in Zurich, for 
 example, in these twenty years, more than one hundred other 
 questions have been placed before the sovereign people. These 
 numbers are large in themselves, but surprising in proportion 
 to the total legislation. Out of 158 general acts passed by the 
 federal assembly from 1874 to 1892, twenty-seven were sub- 
 jected to the referendum; that is, about one-sixth are reviewed 
 and about one-tenth are reversed. Constitutional amendments 
 usually get through sooner or later, but more than two-thirds 
 of the statutes attacked are annulled." 
 
 In his valuable book, "Direct Legislation," J. W. Sullivan 
 thus recounts what the Swiss have done by direct legislation- 
 
 "They have made it easy at any time to alter their canton- 
 al and federal constitutions, that is, to change, even radically, 
 the organization of society, the social contract, and thus to 
 permit a peaceful revolution at the will of the majority. They 
 have as well cleared from the way of majority rule every ob- 
 stacle, privilege of ruler, fetter of ancient law, power of legis- 
 lator. They have simplified the structure of government- 
 held their officials as servants, rendered bureaucracy impossi- 
 ble, converted their representatives to simple committeemen- 
 and shown the parliamentary system not essential to law-mak, 
 ing. They have written their laws in language so plain that a 
 layman may be judge in the highest court. They have fore- 
 stalled monopolies, improved and reduced taxation, avoided in- 
 curring heavy public debts, and made a better distribution of 
 their land than any other European country. They have 
 practically given home rule in local affairs to every commun- 
 ity. They have calmed disturbing political elements; the 
 press is purified, the politician disarmed, the civil service well 
 regulated. Hurtful partisanship is passing away. Since the 
 people as a whole will never willingly surrender their sover- 
 eignty, reactionary movement is possible only in case the na- 
 tion should go backward. But the way is open forward. So- 
 cial ideals may be realized in act and institution. Even now 
 the liberty-loving Swiss citizen can discern in the future a free- 
 dom in which every individual, independent, possessed of 
 rights in nature's resources and in command of the fruits of 
 his toil, may, at his will, on the sole condition that he respect 
 the like aim of other men, pursue his happiness."
 
 Direct Legislation. 155 
 
 Proportional Representation. 
 
 'TpHE term proportional representation has come to be gener- 
 * ally applied to a method of electing representatives whereby 
 the representation shall be in proportion to the votes polled by 
 the several parties, or groups of voters, as against the present 
 method of electing them from single districts by a plurality 
 vote. To effect this end numerous plans have been put forth. 
 
 The cumulative vote allows the voter as many votes as 
 there are representatives to be elected and permits him to dis- 
 tribute them as he pleases among the candidates. This method 
 is applied in a h'mited degree to the choice of members of the 
 lower house of the Illinois legislature. Each district elects 
 three members, and the voter can cast three votes for one can- 
 didate, one and a half votes for two, or one vote each for three. 
 
 With the limited or restricted vote the voter has a less 
 number of votes than the number of representatives to be 
 elected. Thus in the city of Boston the new law allows the 
 voter to vote for only seven aldermen on one ticket, and 
 declares the twelve candidates receiving the highest vote 
 elected. 
 
 The preferential, or, as it is commonly known, the Hare 
 vote, allows the voter to cast one ballot upon which he has 
 named as many candidates as he sees fit, the candidates named 
 being understood to represent the first, second, third, etc., 
 choice. The whole number of ballots cast is divided by the 
 number of representatives to be chosen, and the quotient is 
 the quota, or number of votes required to elect one candidate. 
 In counting the ballots the first choices are read first; the can- 
 didate who receives a quota is declared elected, .and the 
 remaining votes cast for him are counted for the next name on 
 the ballot who is the second choice of the voter. 
 
 The free list, or Swiss vote, allows the voter to vote for a list 
 or ticket as we do in this country, and to designate preferences 
 on the list. The total vote is divided as in the Hare system to 
 get the quota, and the several parties are apportioned repre- 
 sentatives according to the number of quotas they have. 
 The successful candidates are those standing highest on their
 
 156 Direct Legislation, 
 
 respective lists. This method is now in use in Switzerland for 
 the election of representatives. 
 
 The Gove system is a modified form of the Hare method. 
 Instead of the voter naming the candidates whom he prefers, 
 the candidates themselves before election announce to whom 
 they will give their surplus votes. 
 
 The proxy vote is simply an introduction of the corpora- 
 tion vote into legislative bodies. The candidates who are 
 elected in the legislative assembly cast, not their individual 
 votes, as at present, but the number of proxies they hold. 
 
 It will be seen that there are three principles involved in 
 these several methods, the election by cumulation of votes, the 
 election by quotas, and the vote by proxies. The cumulative 
 vote was the first to be put into actual service, being used in 
 England for the election of members of school boards, etc., and 
 in this country in the so-called three-cornered districts for the 
 election of members of the legislature. It still has the support 
 of quite a number of persons, but its limitations are now com- 
 ing to be recognized. John Stuart Mill, who was an advocate 
 of the cumulative vote, declared it to be merely a makeshift in 
 comparison with the quota system of Hare. The objection to 
 the cumulative vote lies in the fact that if the districts are 
 small only two parties can obtain representation, and these in 
 an arbitrary way, while if the districts be larger, that is, if the 
 number of representatives in the district be made greater, the 
 waste and uncertainty is apparent. A party may decide to 
 vote for four candidates when it has votes enough to elect six; 
 or it may try for six when it has votes for only four. In either 
 case it is deprived of a part of its just share in the representa- 
 tion. The proxy system contains some theoretical merits, but 
 it is feared that in practice it would not work well at present. 
 The tendency to hero-worship would prompt so many voters to 
 give their proxies to a few favorites that the real voting 
 strength of the assembly would be in the hands of two or three 
 men, thus destroying its value as a deliberative body. 
 
 The real strength of proportional representation lies in 
 some form of the quota principle, and the tendency in this, 
 country as in Switzerland and Belgium is tow ard the free list
 
 " The American people must learn the lesson of money , or 
 they are lost.' 1 
 
 THE PHILOSOPHY OF MONEY. 
 
 BY HOWABD S. TAYLOB. 
 
 % 
 
 HpHE word "money" is derived from the Latin moneta (from 
 * moneo, to warn), meaning "warned" or "admonished." 
 Moneta was a surname of Juno, because she was believed to 
 have warned the Romans by means of an earthquake to offer 
 sacrifice. In the temple of Juno Moneta coins were made 
 hence moneta, meaning either a mint, or coin, or coined money. 
 The English word "money" is comprehensively defined by 
 Webster as "any currency usually and lawfully employed in 
 buying and selling;" and the word "currency" is defined as 
 "that which is in circulation or is given and taken as having 
 or representing value." 
 
 Varieties of Money. 
 
 Until recent times many substances entirely foreign to our 
 modern ideas of money were used as measures of value, among 
 which were: 
 
 Leather. In Rome and Sparta 700 B. C., and in Persia, 
 Tartary, France and Spain as late as the sixteenth century. 
 
 Bark. China used the inner bark of the mulberry tree in 
 the fourteenth century. 
 
 Base Metals. Iron was used by the ancient Spartans, Ro- 
 mans and Hebrews; tin was used in ancient Syracuse and 
 Britain, while lead is still used in Burmah and brass in China. 
 
 All of these forms of money were stamped with some sort 
 of design indicating their exchangeable value and by whose 
 authority they were issued. 
 
 Wood. Several ancient governments used money made of 
 wood. From the time of Henry I. (A. D. 1273), up to the f oun- 
 
 157
 
 158 The Philosophy of Money. 
 
 dation of the Bank of England in 1694, a period of over four 
 hundred years, England circulated a legal- tender money made 
 of wood, called "exchange tallies." The "tally" issued by the 
 British Exchequer was a stick or bit of peeled rod upon 
 which notches were cut, indicative of an account, pledge or 
 other commercial transaction. It was split in such a way as 
 to divide the notches. One-half the "tally" was given to the 
 payer and one-half was retained by the Exchequer; and the 
 transaction might be verified at any time by fitting the two 
 halves together, when the notches would be found to "tally" 
 with each other if the check had not been tampered with. 
 Jonathan Duncan said that these wooden representatives of 
 value circulated freely among the people and sustained the 
 trade of England. 
 
 Wampum. One of the prevailing forms of money in use 
 among the New England colonies was wampum. This was 
 simply strings of white and black beads made from sea-shells 
 found along the New England coasts. In 1641 Massachusetts 
 made these beads a legal tender at the rate of six for a penny 
 up to the sum of 10; and they were receivable, at that rate, 
 for all judgments and taxes. In 1643 the limit of this legal 
 tender was reduced to 40 shillings. In 1649 the colony passed 
 a statute forbidding the receipt of wampum for taxes, and its 
 use as money rapidly declined, though it still circulated in a 
 limited way in several of the colonies as late as 1704. 
 
 Tobacco. The people of Maryland and Virginia, before 
 the Revolutionary War and for some time after, in default of 
 gold and silver, used tobacco as money, made it money by law, 
 reckoned the fees and salaries of government officers in tobac- 
 co and collected the public taxes in that article. 
 
 Peltries. In an early day several of the Western States 
 made peltries a legal tender. In 1785 the people of the terri- 
 tory now called Tennessee organized a State called "Franklin" 
 and passed the following act, which is illustrative of similar 
 acts in other States: 
 
 "Be it enacted by the General Assembly of the State of 
 Franklin, and it is hereby enacted by the authority of the 
 same,
 
 The Philosophy of Money. 159 
 
 "That from the first day of January, 1789, the salaries of 
 the officers of the Commonwealth be as follows: 
 
 'His Excellency the Governor, per annum, 1,000 deer skins. 
 
 "His Honor the Chief Justice, per annum, 500 deer skins. 
 
 "The Secretary to His Excellency, the Governor, per an- 
 num, 500 raccoon skins. 
 
 "The Treasurer of the State, 450 raccoon skins. 
 
 "Each County Clerk, 300 beaver skins. 
 
 "Clerk of the House of Commons, 200 raccoon skins. 
 
 "Members of the Assembly, per diem, 3 raccoon skins. 
 
 "Justice's fees for signing a warrant, 1 muskrat skin. 
 
 "To the Constable for serving a warrant, 1 mink skin. 
 
 "Enacted into law the 18th day of October, 1789, under the 
 great seal of State." 
 
 Paper. The first printed bank notes of which we have any 
 record were issued by Palmstruck, a banker of Sweden, in 1660. 
 
 Gold and Silver have been used as money metals from 
 the earliest times of recorded history. The Bible has many 
 references to the use of both gold and silver as early as the 
 age of Abraham. 
 
 Intrinsic "Value. 
 
 No kind of money, as such, has any intrinsic value, for the 
 instant the material of which the money is made is used for 
 another purpose it ceases to be money. As money, the sole 
 value of the material arises from its function as a circulating 
 medium; and even the value of gold and silver as used in the 
 arts and sciences will be largely determined by the demand 
 for them for money purposes. Of recent years the general de- 
 monetization of silver by the principal nations has depreciated 
 the value of that metal about one-half, and there is but little 
 doubt that if gold were similarly demonetized it would corre- 
 spondingly decline in value. This was the opinion of Cernuschi. 
 He says: "If all nations should demonetize gold it would be 
 worth more than copper, but it would not be worth much 
 more." 
 
 Appleton's American Encyclopedia (vol. XI, p. 735) says: . 
 "After the discovery of gold in California, Austria, the Nether- 
 lands, Belgium and Germany all demonetized gold and adopted 
 silver as the legal tender at a fixed rate. In those countries 
 gold only circulated as a commodity, subject to daily fluctu-
 
 160 The Philosophy of Money. 
 
 ations in value; and as a consequence, deprived as it was of 
 legal support as money, it was but little used." 
 
 Upon the subject of intrinsic value the following author- 
 ities are cited: 
 
 "Congress shall have power to coin money and regulate 
 the value thereof." Constitution of the United States. 
 
 "To coin money and regulate the value thereof as an act of 
 sovereignty involves the right to determine what shall be 
 taken and received as money; at what measure or price it shall 
 be taken; and what shall be its effect when passed or tendered 
 in payment or satisfaction of legal obligations. Government 
 can give to its stamp upon leather the same money value as if 
 put upon gold or silver or any other material. The authority 
 which coins or stamps itself upon the article can select what 
 substance it may deem suitable to receive the stamp and pass 
 as money; and it can affix what value it deems proper, inde- 
 pendent of the intrinsic value of the substance upon which it 
 is affixed. The currency value is in the stamp, when used as 
 money, and not in the material independent of the stamp. In 
 other words, the MONEY QUALITY is the authority which makesit 
 current and gives it power to accomplish the purpose for which 
 it was created." Tiffany, Constitutional Law. 
 
 "Whatever power is over the currency is vested in Con- 
 gress. If the power to declare what is money is not in Con- 
 gress, it is annihilated. We repeat, money is not a substance, 
 but an impression of legal authority, a printed legal decree." 
 U. S. Supreme Court (12 Wallace, p. 519). 
 
 "The gold dollar is not a commodity having an intrinsic 
 value, but money having only a statutory value; and every dol- 
 lar has the same value without regard to the material. The 
 gold dollar has not intrinsic value." Supreme Court of Iowa 
 (16 Iowa Rep., p. 246). 
 
 "Money is the medium of exchange. Whatever performs 
 this function, does the work, is money, no matter what it is 
 made of." Walker, Political Economy. 
 
 "An article is determined to be money by reason of the 
 performance by it of certain functions, without regard to its 
 form or substance." Appleton's Encyclopedia. 
 
 "Money is a value created by law. Its basis is legal, and 
 not material. It is, perhaps, not easy to convince one that the 
 value of metallic money is created by law. It is, however a 
 fact." Cernuschi. 
 
 Specie Basis. 
 
 Where paper currency is made redeemable in gold or silver 
 the paper money is said to rest on a "specie basis." This
 
 The Philosophy of Money. 161 
 
 monetary scheme now prevails throughout the civilized world. 
 In almost every commercial nation a large portion of the cur- 
 rency in use is paper money in theory, at least, convertible into 
 metallic money at the option of the holder. This financial 
 system is framed upon the violent hypothesis that real money 
 can only be made of the precious metals and that paper bills 
 are not money, but only representatives of money. Those who 
 are addicted to this theory are in the habit of designating 
 coins made of the precious metals as "primary money," "re- 
 demption money" or "standard money;" while paper bills are 
 called "secondary money," or "credit money," and are worth- 
 less except as they may be redeemed in "primary money." The 
 specie basis may be gold or silver or both. Since -the world- 
 wide demonetization of silver gold only is the basis in the lead- 
 ing nations of the earth. 
 
 The specie basis theory is open to the following weighty 
 objections: 
 
 1. It is contrary to the fundamental law of the United States 
 the Constitution. 
 
 Judge Tiffany, in his work on Constitutional Law, ex- 
 pounding the right of Congress "to coin money and regulate 
 the value thereof," says: 
 
 "The authority which coins or stamps itself upon the arti- 
 cle can select what substance it may deem suitable to receive 
 the stamp and pass as money; and it can affix what value it 
 deems proper, independent of the intrinsic value of the sub- 
 stance upon which it is affixed." 
 
 This learned opinion, which annihilates all necessary dis- 
 tinction between "primary" and "secondary" money, was fol- 
 lowed by the United States Supreme Court in the celebrated 
 Greenback cases, and hence has all the authority of law. (See 
 12 Wallace's Reports, p. 519.) 
 
 2. The specie basis theory is contrary to the facts of his- 
 tory, some of which will be recited in succeeding pages. Many 
 instances are recorded in which paper and other material have 
 been successfully used as money where no redemption in coin 
 was promised or possible. 
 
 3. The specie basis theory postulates that a certain amount 
 of "redemption money" will support or float a proportional
 
 162 The Philosophy of Money. 
 
 amount of "credit money." As the specie increases the paper 
 money may be safely increased; and as the specie decreases 
 paper money must also be decreased a philosophy that would 
 lead to the absurd conclusion that when all specie disappears 
 the people can have no money of any kind. Mr. R. H. Patter- 
 son, a distinguished English economist, truly puts the paradox 
 as follows: 
 
 "The gospel of monetary science now is, that when a coun- 
 try does not want paper money, it ought to have a great supply 
 of it; and when it does require paper money it shall have none. 
 When a country has enough of specie it ought to double its 
 currency by issuing an equal amount of bank notes; and when 
 there is no specie there should likewise be no notes. Is it nec- 
 essary to discuss such a theory? In order to be rejected it 
 needs only to be stated; in order to be rejected it only needs to 
 be understood. It is a theoretical monstrosity against which 
 common sense revolts a burlesque of reason which even the 
 present generation will live to laugh at." 
 
 4. The specie basis is insufficient in volume to redeem the 
 credit money which is necessarily used in business. The entire 
 circulating medium of the United States is, approximately, six- 
 teen hundred millions of dollars, of which about one-third is 
 gold, one-third silver and one-third paper. Since silver was 
 demonetized it is now only credit money; hence we have but 
 one dollar of redemption money (gold) with which to redeem 
 two of credit money, or, taking into consideration, as we should, 
 the vast volume of checks, drafts and other credits which must 
 finally be redeemed in gold, it is perfectly apparent that the 
 United States has not one dollar of redemption money with 
 which to redeem one hundred dollars of credit and thus the 
 whole theory of redemption becomes a mere figment incapable 
 of practical realization. And what is true of the United States 
 is true of all other countries. 
 
 5. The specie basis is a breeder of panics. In times of pros- 
 perity and confidence credits are safely increased to accommo- 
 date the increasing volume of business; and the specie basis is 
 sufficient merely because it is not put to the test, the people 
 preferring paper money because of its superior convenience ; 
 but at such a time a pebble may start an avalanche. A start- 
 ling failure occurs somewhere, creditors presa for liquidation,
 
 The Philosophy of Money. 1<& 
 
 the banks are besieged, and, being unable to redeem their 
 promises to pay gold, they suspend and the panic is complete- 
 Such is the recurrent history of finance in all civilized lands. 
 
 Charles Sears, an eminent authority, says of the gold 
 basis: 
 
 "Within the last fifty years, say, a money crisis has coine 
 quite regularly every ten years. Something any one of a 
 dozen causes, few know what sets gold to flowing out. Fifty 
 millions withdrawn in a short time from its usual place pt de- 
 posit is quite sufficient to make the whole volume of coin dis- 
 appear from ordinary circulation as completely as if it ha-J 
 never existed. The metallic basis is gone slipped out; the 
 pivot of the system is dislocated; somebody wanted it and took 
 it, and the pyramid tumbles down, burying in its ruins three- 
 fourths of a business generation." 
 
 To the same effect is the opinion of the famous American 
 jurist, Judge Walker. He says: 
 
 "The whole paper scheme is founded on the presumption 
 that the holders of these bills will not generally ask for specie 
 at the same time; and, therefore, the amount of specie kept in 
 reserve bears but a small proportion to the notes in circulation. 
 And this is the great evil of the system. A general and simul- 
 taneous demand for specie cannot possibly be met, and disas- 
 ter must follow. To enforce a universal performance of these 
 promises is to insure their being broken. Every sudden panic, 
 therefore, must produce wide-spread calamity." Walker's 
 American Law, p. 152. 
 
 6. The specie basis affords a means by which greedy specula- 
 tors work "a corner" in gold and thus extort large sums in 
 profits which the people eventually have to pay. The laws and 
 official rulings, for instance, which require the maintenance of 
 a gold reserve in the Federal treasury and the payment of 
 duties and interest on the public debt in gold, create a special 
 and imperative demand for the yellow metal; and as the supply 
 of that kind of money is almost entirely in the hands of a few 
 great banking firms, the latter can, at their pleasure, extort 
 such terms as they please when applied to for gold. An in- 
 stance of the kind occurred on Feb. 8th, 1895. On that day, in 
 order to maintain its gold reserve, the United States govern- 
 ment purchased of M. Rothschild & Sons and J. P. Morgan & 
 Co., backers of London, 3,500,000 ounces of standard gold coin 
 of the United Statei at the rate of $17.80441 per ounce, and
 
 164 The Philosophy of Money. 
 
 paid for it in United States four per cent, thirty-year coupon 
 or registered bonds, interest payable quarterly. These bonds 
 were taken by the British bankers at $1.04, and were sold by 
 them within ten days at $1.18, by which the foreign gold ex- 
 ploiters made a net profit of about eight million dollars to be 
 eventually paid by the people. 
 
 7. The specie basis must inevitably become more and more 
 insufficient with the lapse of time, and the disasters due to it in 
 the past become more frequent and distressing. The popula- 
 tion of the world is increasing, barbarous nations are becoming 
 commercial, and commercial nations are extending their 
 commerce with unexampled rapidity from year to year. 
 With this increasing business must come a necessity 
 for a corresponding increase in the medium of exchange 
 money. But no material increase of the precious metals is 
 possible. On the contrary, as the mines successively become 
 exhausted, or deeper and more difficult to work, it is clear that 
 the annual supply of gold and silver must become increasingly 
 insufficient to replace that which has been lost or consumed in 
 the arts and sciences; and hence the difficulties of the specie 
 basis will of necessity become more and more aggravated as 
 time goes on. 
 
 Considerations such as the foregoing have led to the rapid 
 development of a new school of finance which, rejecting the 
 specie basis as antiquated and no longer tenable, professes to 
 find a sufficient guarantee for the stability of money in 
 The IJegal Tender Basis. 
 
 President Grant said: 
 
 "My own judgment is that a specie basis cannot be 
 reached and maintained until our exports exclusive of gold pay 
 for our imports, interest due abroad, and other specie obliga- 
 tions, or so nearly as to leave an appreciable accumulation of 
 the precious metals in the country from the product of our 
 mines." Message, Dec. 1, 1873. 
 
 Plentiful experience has demonstrated that a paper money 
 based upon the authority, faith and credit of the government 
 and made by law a full legal tender for all debts will serve all 
 the purposes of a staple circulating medium as effectually as 
 gold itself.
 
 The Philosophy of Money. 165 
 
 The effectiveness of legal-tender paper depends upon two 
 circumstances : 
 
 1. Government can by law compel the people to take it in 
 satisfaction of private debts, by refusing to enforce contracts 
 payable in any other kind of money. 
 
 2. The government may receive such legal-tender paper 
 in satisfaction of all kinds of taxes and duties, thus giving such 
 money a positive value equal to gold. 
 
 The U. S. Supreme Court, in the celebrated Greenback 
 cases, says: 
 
 "Making these notes legal tender gave them new uses (or 
 functions), and it requires no argument to prove the value of 
 things as in proportion to the uses to which they may be ap- 
 plied." 12 Wallace Reports, p. 519. 
 
 Benjamin Franklin, defending the Pennsylvania colonial 
 paper money before a committee of the English Parliament, in 
 1764, said: 
 
 "On the whole no method has hitherto been found to 
 establish a medium of trade, in lieu of coin, equal in all its 
 advantages to bills of credit founded on sufficient taxes for dis- 
 charging it at the end of the time, and in the meantime made 
 a general legal tender." 
 
 Thomas Jefferson, in his letter to Mr. Epps, said of govern- 
 ment paper money: 
 
 "It is the only resource which can never fail them, and it is 
 an abundant one for every necessary purpose. Treasury bills, 
 bottomed on taxes, bearing or not bearing interest as may be 
 found necessary, thrown into circulation, will take the place of 
 BO much gold or silver." 
 
 President Jackson, in his message, 1829, said: 
 
 " I submit to the wisdom of the legislature whether a 
 national one [currency] founded on the credit of the government 
 and its resources might not be devised." 
 
 John C. Calhoun, in a speech in the U. S. Senate Dec. 18th, 
 1837, said: 
 
 " It appears to me, after bestowing the best reflection I can 
 give the subject, that no convertible paper that no paper that 
 rests upon a promise to pay is suitable for a currency. It is 
 the form of credit paper in transactions between men, but not 
 for a standard of value to perform exchanges generally, which 
 constitutes the appropriate functions of money or currency. 
 No one can doubt but that the credit of the government is bet-
 
 160 The Philosophy of Money. 
 
 ter than that of any bank more staple and safe. I now under- 
 take to affirm, and without the least fear that I can be 
 answered, that paper money issued by the government, to re- 
 ceive it for all dues, would form a perfect circulation which 
 would not be abused by the government; that it would be 
 uniform with the metals themselves." 
 
 Legal-tender paper money is usually issued in times of 
 war when gold and silver are hoarded or exported from the 
 country; and, as a consequence, such legal tender is put to the 
 severest possible tests, those of an imperilled government, dis- 
 turbed industry and impeded foreign trade; nevertheless, his- 
 tory abounds with instances to prove the entire sufficiency of 
 this kind of money. 
 
 In 1156 the Republic of Venice established a system of 
 paper credits which served as the principal circulating medium 
 of that country until 1797. This money was always at par and 
 frequently at a premium. In 1770 the Russian government 
 issued its own notes, which sustained the government through 
 two wars and commanded a premium over coin. In 1797 to 
 1823 England issued $225,000,000 full legal-tender paper with 
 which to carry on war against Napoleon. In his "Political 
 Economy," John S. Mill says of these notes: "After they were 
 made a legal tender they never depreciated a particle." 
 
 During the colonial period of American history several of 
 the colonies issued and successfully maintained legal-tender 
 paper money. One instance is illustrative of them all. In 1739 
 Pennsylvania issued $400,000 in legal-tender paper not redeem- 
 able in coin, but receivable for taxes, which was loaned directly 
 to the people on security of land and plate. This money con- 
 tinued in circulation until it was prohibited by the British 
 government in 1775. Commenting on the success of this sys- 
 tem. Dr. Franklin said: "Between the years 1740 and 1775, 
 while abundance reigned in Pennsylvania and there was peace 
 in all her borders, a more happy and prosperous population 
 could not, perhaps, be found on this globe." 
 
 During the Franco-German war France issued an enor- 
 mous volume of legal-tender paper money, of which Victor 
 Bonnet, the eminent French economist, says: "In the midst of 
 the greatest calamities that ever befell a nation, with an enor-
 
 The Philosophy of Money. 167 
 
 mous ransom to pay a foreign nation, and with great domestic 
 losses to repair, a credit circulation was maintained four times 
 as large at its base without depreciation. This circulation 
 reached $600,000,000." 
 
 During the war of the rebellion in the United States 
 1861-5) the government issued a volume of legal tender "green- 
 backs" which on July 1st, 1865, was outstanding to the amount 
 of $432,687,966. 
 
 The first $60,000,000 of this paper money, issued under 
 authority of the acts of July 17 and August 5th, 1861, and 
 February 12th, 1862, called "demand notes," was made a full 
 legal tender for all debts public and private. This issue never 
 fell below and often was above par as compared with gold. In 
 a speech delivered in the U. S. Senate Julj 4th, 1862, Hon. John 
 Sherman said of these "demand notes ": 
 
 " The notes are now held and hoarded. The first issue of 
 $60,000,000 were issued with the right of being converted into 
 6 per cent, twenty-year bonds and with the privilege of being 
 paid for duties in customs. They are now far above par and 
 hoarded." 
 
 In Schucker's Life of Salmon P. Chase, p. 225, the author 
 ayg: 
 
 "The demand notes, being receivable for customs the sam 
 as coin, kept pace with the advance in the price of coin." 
 
 All of the greenbacks except the first $60,000,000 were pur- 
 posely depreciated by the "exception clause;" that is, they were 
 made a legal tender for all debts, public and private, except 
 duties on imports and interest on the public debt, which 
 latter were required to be paid in coin. This exception clause 
 created a special demand for coin, and as a consequence metal- 
 lic money rose to a great premium, at one time (July, 1864) be- 
 ing at a premium of $2.85 in greenbacks to SI in coin. That 
 these greenbacks were purposely depreciated stands upon the 
 evidence of Hon. John Sherman, who in a report as chairman of 
 the Senate Finance Committee, made on the 12th of November, 
 1867, said: "But it was found that with such a restriction 
 upon the notes the bonds could not be negotiated, and it ba-
 
 168 The Philosophy of Money. 
 
 came necessary to depreciate the notes in order to make a mar- 
 ket for the bonds." 
 
 Speaking of the amendment by which the "exception 
 clause" was passed, Hon. Thaddeus Stevens said in a speech 
 delivered in the House, February 20th, 1862: 
 
 "It has all the bad qualities that its enemies charged in 
 the original bill and none of its benefits. It now creates 
 money and by its very terms declares it a depre- 
 ciated currency. It makes two classes of money one for 
 the banks and brokers, and another for the people. It dis- 
 criminates between the rights of different classes of creditors, 
 allowing the rich capitalists to demand gold, and compelling 
 the ordinary lender of money on individual security to receive 
 
 notes which the government had purposely discredited 
 
 But now comes the main clause. All classes of people shall 
 take these notes at par for every article of trade or contract 
 unless they have money enough to buy United States bonds, 
 and then they shall be paid in gold. Who is that favored class? 
 The banks and brokers, and nobody else." 
 
 This conspiracy of the lawmakers, by which the soldier in 
 the field was paid in depreciated greenbacks while the Wall 
 Street usurer received gold, did not deprive the paper money 
 of its splendid functions. While coin rose to a great premium, 
 owing to the special use made of it in payment of customs and 
 interest on the public debt, the legal-tender money carried on 
 the great war and conducted the business of the most prolific 
 and prosperous epoch in the history of the United States. 
 
 As a matter of fact the greenbacks, discredited by legis- 
 lation as they were, did not depreciate in comparison with com- 
 modities, but gold appreciated owing to the special demand 
 created for it by law. The people never lost confidence in the 
 government paper money, even in the darkest hours of the 
 panic of 1873, as is shown by the language of President Grant. 
 He said : 
 
 "The experience of the present panic has proven that the 
 currency of the country, based, as it is, upon the credit of the 
 country, is the best that ever has been devised. Usually in 
 times of such trials, currency has become worthless or so much 
 depreciated in value as to inflate the values of all necessaries 
 of life as compared with currency. Everyone holding it has 
 ben anxious to dispose of it on any terms. Now we witness
 
 The Philosophy of Money. 169 
 
 the reverse. Holders of currency hoard it as they did gold in 
 former experiences of like nature." Message, Dec. 1, 1873. 
 
 The Functions of Money. 
 
 The functions or uses of money are three-fold: 
 
 It is a measure of value. 
 
 It is a medium of exchange. 
 
 It is a means of storing wealth. 
 
 As a measure of value money determines in what propor- 
 tion commodities and services shall be interchanged. The 
 yardstick measures the quantity of fabrics; but some fabrics 
 are more valuable than others. A bolt of silk, for instance, is 
 more valuable than a bolt of muslin a difference which the 
 yaidstick, alone, cannot indicate; it merely measures quantities, 
 not values. Here the money measure becomes necessary. The 
 abstract unit which we call a dollar measures the values of 
 both silk and muslin and determines how many yards of mus- 
 lin should be exchanged for a yard of silk. 
 
 Money is a medium of exchange. Smith has a horse and 
 buggy which he wishes to exchange for a piano belonging to 
 Brown. Brown is willing to part with the piano, but does not 
 want a horse and buggy; he does want, however, a gold watch. 
 Jones has such a watch, but wants to dispose of it for clothing. 
 Wilson has clothing, but he wants coal. For these four parties 
 to find out each other's wants and effect an exchange of actual 
 commodities and adjust the difference in value between the 
 articles would involve time and labor and make so many diffi- 
 culties that the transactions would bo greatly delayed, if not 
 defeated. Here money performs its beneficent offices as a me- 
 dium of exchange. Smith sells his horse and buggy for money 
 and with it purchases Brown's piano. Brown buys the watch 
 he wants, and thus money goes from hand to hand, affecting in- 
 numerable exchanges, not only in the small neighborhood, but 
 in great commercial circles, thereby bringing the antipodes 
 together and enabling them to supply each other's wants with 
 the least possible loss of time and labor. 
 
 Money is, also, a means of storing wealth. Jackson has 
 a valuable farm, but is getting too old or infirm in health to
 
 170 The Philosophy of Money. 
 
 work it. He might exchange it for a great quantity of food, 
 clothing, and other necessaries sufficient to last him the re- 
 mainder of his life; but these articles could not safely be stored 
 so as to preserve them for future years, and some representa- 
 tive, that can be stored, must be found. Money is that repre- 
 sentative. Jackson sells his farm for money, and with the 
 money purchases from time to time the necessaries required. 
 
 Prom a brief study of these three great functions per- 
 formed by money may be readily determined what should be 
 the characteristics of a perfect currency, one that would most 
 effectually and justly serve mankind. 
 
 As a measure of values and as a means of storing wealth 
 it is clear that money ought to be stable, that is, it should as 
 nearly as possible have the same purchasing power from year 
 to year and in all sections of the country; for when money 
 fluctuates in purchasing power it is obvious that some men 
 will gain and some will lose without any merit or fault upon 
 their part, but simply in consequence of the fluctuations in the 
 value of money. This is particularly true in case of debt, for 
 if a debt be contracted when money is cheap, and paid when 
 money is dear, the debtor will evidently lose by the change, 
 and if the circumstances be reversed the creditor will lose. 
 
 To secure such stability or uniformity of purchasing power 
 no measure or method is so effectual as for the government to 
 make all its money a full legal tender for all debts public and 
 private. 
 
 Ae a medium of exchange the volume or quantity of money 
 in circulation should be sufficiently large to accomplish the 
 transaction of business without waste or delay. In estimating 
 the necessary volume it is proper to take into consideration the 
 numbers of population, the magnitude of business transacted, 
 and since a nimble dollar will perform the work of several slow 
 ones, the "effectiveness" or rapidity with which money circu- 
 lates; and si nee population and business are, upon the whole, 
 constantly increasing, and the rapidity of circulation (until 
 some swifter method of locomotion be discovered) remains un- 
 altered, the volume of money, clearly, ought to be increased 
 from year to year. Few who have not patiently studied the
 
 The Philosophy of Money. 171 
 
 problems of finance understand the mighty effects of an expan- 
 sion or contraction of the money volume upon, not only the 
 material, but the moral well-being of mankind. The very 
 heart of the complex money question, the center of all ita 
 divergent issues, is the question of 
 
 The Volume of Money. 
 
 The volume or quantity of money in circulation is always 
 hard to determine, principally because banks, brokers and their 
 allies in official and journalistic positions are generally inter- 
 ested in concealing or misstating the facts on purpose to mis- 
 lead the public; so that, not infrequently, a period of financial 
 disaster steals upon the people unaware and they are compelled 
 to endure all the miseries of such an event without being able 
 to detect the cause or apply the remedy. In such circum- 
 stances the masses may dimly perceive that they are being 
 robbed, yet, unable to detect the means of their spoliation, they 
 attribute it to every cause but the real one, and thus the 
 spoliators are enabled to repeat their robbery again and again, 
 undetected by any save a few whose complaints are regarded 
 as the extravagances of uninformed or fanatic minds. 
 
 To fully comprehend how the exploiters of money may en- 
 rich themselves and impoverish others by merely manipulating 
 the currency it is necessary to understand the primary fact 
 that an increasing volume of money brings rising prices and 
 business activity, while a diminishing volume of money 
 causes falling prices and business stagnation. Upon this propo- 
 sition the following authorities are cited: 
 
 David Hume, the English historian, in his essay on 
 "Money," says: 
 
 'We find that in every kingdom into which money begins 
 to flow in greater abundance than formerly everything takes a 
 new face; labor and industry gain life, the merchants become 
 more enterprising, the manu acturers more diligent and skill- 
 ful, and the farmer follows his plow with greater attention and 
 alacrity. The good policy of the government consists of keep- 
 ing it, if possible, still increasing as long as there ia an unde- 
 veloped resource or room for a new immigrant, because by that 
 means there is kept alive a spirit of industry in the nation 
 which increases the stock of labor, in which consists all real
 
 172 The Philosophy of Money. 
 
 power and riches. A nation whose money decreases is actually 
 weaker and more miserable than other nations which possess 
 less money but are on the increasing hand." Essays and 
 Treatises, vol. /, p. 283. 
 
 Henri Cernuschi, an ex-banker of Paris, and recognized as, 
 perhaps, the most eminent of the French writers on finance, 
 says: 
 
 "The value of money depends upon its quantity. It is the 
 same with gold as with greenbacks. If the stock in circulation 
 is augmented the purchasing power of every greenback is dimin- 
 ished; and so with gold and silver. The purchasing power is 
 always in relation to the quantity of the money." Nomisma, 
 p. 15. 
 
 "That commodities would rise and fall in price in propor- 
 tion to the increase or diminution of money I assume as a fact 
 that is incontrovertible. That such would be the case the 
 most celebrated writers on political economy are agreed. ' 
 Ricardo, Political Economy. 
 
 "If the whole money in circulation was doubled prices 
 would double. If it was only increased one-fourth, prices 
 would rise one-fourth. The very same effect would be pro- 
 duced on prices if we suppose the goods (the uses for money) 
 diminished instead of the money increased; and the contrary 
 effect if the goods were increased or the money diminished. So 
 that the value of money, all other things remaining the same, 
 varies inversely as its quantity; every increase in quantity 
 lowering its value and every diminution raising it in a ratio 
 exactly equivalent." J. S. Mill, Principles of Political 
 Economy. 
 
 Wm. H. Crawford, Secretary of the Treasury, in his report, 
 Feb., 1820, says: 
 
 " All intelligent writers on currency agree that when it 
 (money) is decreasing in amount poverty and misery must 
 prevail." 
 
 By joint resolution of the United States Congress Aug. 
 15th, 1876, a " United States Monetary Commission " was ap- 
 pointed to inquire into the prevailing " hard times." It con- 
 sisted of Senators John P. Jones, Lewis V. Bogy and Geo. S. 
 Boutwell, and Congressmen Randall L. Gibson, George Willard 
 and Richard P. Bland; to whom were added Hon. Wm. S. 
 Groesbeck of Ohio, Prof. Francis Bowen of Massachusetts, and 
 Geo. M. Western of Maine; the three latter acting as secre- 
 taries of the commission. On March 2d, 1877, the commission
 
 The Philosophy of Money. 173 
 
 reported. The following extracts are taken from the report : 
 "While the volume of money is decreasing, though very 
 slowly, the value of each unit of money is increasing in a cor- 
 responding ratio, and property and wages are decreasing. Those 
 who have contracted to pay money find that it is constantly 
 becoming more difficult to meet their engagements. The mar- 
 gins of securities melt rapidly, and their confiscation by the 
 creditor becomes only a question of time. All productive 
 enterprises are discouraged and stagnate because the cost of 
 producing commodities today will not be covered by the price 
 obtainable for them tomorrow. Exchanges become sluggish 
 because those who have money will not part with it for either 
 property or service, for the obvious reason that money alone is 
 increasing in value while everything else is decreasing in price. 
 This results in the withdrawal of money from the channels of 
 circulation and its deposit in great hoards where it can exert 
 uo influence on prices. Money in shrinking volume becomes 
 the paramount object of commerce instead of the beneficent 
 instrument. Instead of mobilizing industry, it poisons and 
 dries up its life currents. It is the fruitful source of political 
 and social disturbance. It foments strife between labor and 
 other forms of capital while itself, hidden away, gorges on 
 both. It rewards close-fisted lenders and filches from and 
 bankrupts enterprising producers. An increasing value of 
 money and falling prices have been and are more fruitful of 
 human misery than war, pestilence or famine; they have 
 wrought more injustice than all the bad laws ever enacted." 
 Report of U. S. Monetary Commission, vol. I, p. 10 et seq. 
 
 Pointing out how a contraction of the money volume in- 
 creases the debt obligations of the past, R. H. Patterson, 
 especially commended by Gladstone as one of the ablest of 
 English writers on finance, says: 
 
 "And what is such a dearth of money and rise in the 
 measure of value but an injustice to the many to the gain of 
 the few an unfair exaltation of the power of the past over 
 the present, an unfair and undesirable aggravation of the pov- 
 erty of the poor and the wealth of the rich a stereotyping of 
 classes according to wealth, until they tend to become perma- 
 nent ? We have seen how powerful and beneficial was the in- 
 flux of the precious metals from the New World four centuries 
 ago in breaking the social bondage which had settled over 
 Europe during the long night of the Dark Ages, enabling that 
 generation to escape from the heritage of the past and bound 
 forward upon the new career then opening to mankind. Such 
 times come from the hand of Providence, and with an exceed- 
 ing rarity even in the long carder of civilized mankind. But
 
 174 The Philosophy of Money. 
 
 at least let us avoid the opposite and never allow successive 
 generations to be unfairly nay, most unjustly, though it may 
 not be so meant handicapped, each in its own race, owing to 
 a growing dearth and dearness of money." The New Qolden 
 Age, vol. II, p. 500. 
 
 President Grant said: 
 
 "To increase our exports sufficient money is required to 
 keep all the industries of the country employed. Without this 
 national as well as individual bankruptcy must ensue." 
 Message, Dec. 1st, 1873. 
 
 Hon. John Sherman, in a speech in the Senate, Jan. 27, 
 1869, said in opposition to a bill to contract the currency by re- 
 tiring the greenbacks: 
 
 "It is not possible to take this voyage without the sorest 
 distress. To every person except a capitalist out of debt, or a 
 salaried officer, or annuitant, it is a period of loss, danger, lass- 
 itude of trade, fall of wages, suspension of enterprise, bank- 
 ruptcy and disaster. ... It means the ruin of all dealers 
 whose debts are twice their business capital though one-third 
 less than their actual property. It means the fall of all agri- 
 cultural productions without any great reduction of taxes. 
 When that day comes every man, as the sailor says, will be 
 close-reefed; all enterprise will be suspended, every bank will 
 have contracted its currency to the lowest limit; and the debtor, 
 compelled to meet in coin a debt contracted in currency, will 
 lied the coin hoarded in the treasury, no representative of coin 
 in circulation, his property shrunk not only to the extent of 
 the depreciation of the currency, but still more by the artificial 
 scarcity made by the holders of gold. To attempt this task by 
 a surprise upon our people, by arresting them in the midst of 
 their lawful business and applying a new standard of value to 
 their property without any reduction of their debts, or giving 
 them an opportunity to compound with their 'creditors, or to 
 distribute their losses, would be an act of folly without an ex- 
 ample in evil in modern times." Congressional Globe, 1869, 
 p. 629. 
 
 In a speech in the United States Senate, March 17, 1874, 
 General John A. Logan pointed out the cause of the panic of 
 1873 as follows: 
 
 "But, sir, that the panic was not due to the character of 
 the currency is proved by the history of the panic itself. . . , 
 No, sir, the panic was not attributable to the character of the 
 currency, but to a money famine, and to nothing else. In the 
 very midst of the panic, we saw the leading bankers and busi- 
 ness men of New York pressing and urging the President and
 
 The Philosophy of Money- 175 
 
 the Secretary of the Treasury to let loose twenty or twenty-five 
 millions more of the same paper for their relief the very 
 same men who today denounce it as a disgrace to our govern- 
 ment. It was good enough for them when they were in trouble. 
 "Why is it that representatives forget the interests of their 
 own section and stand up here as the advocates of the gold 
 brokers and money-lenders and sharks, the same class of men 
 whose tables Christ turned over, and whom he lashed out of 
 the temple at Jerusalem? . . . Carry out the theory of 
 the contractionists and what must be the inevitable result? 
 Every enterprise and industry must be dwarfed in like propor- 
 tion. The busy hum of the spindle will cease its sound in many 
 a mill which now gives employment to hundreds of active 
 hands and supplies the comforts of life to many a happy home. 
 The bright blaze of many an iron foundry which gives life and 
 cheerfulness to the grand scenery along the streams of Penn- 
 sylvania will cease to gild the night with its rays. And the 
 same industry in my own State, and that of the Senator from 
 Missouri, which has been so rapidly increasing of late, will be 
 crippled, and hundreds who now find employment there will be 
 compelled to seek a home elsewhere for want of work. The 
 undeveloped resources of the South and West, which we have 
 just begun to appreciate, will rest in abeyance until a wiser 
 policy shall bring them into use. . . . Why, sir, the 
 people were never freer from debt in proportion to the business 
 done than in 1865, at the close of the war, when Mr. McCulloch 
 began his system of contraction, and at the very time when 
 eleven millions more people were to be supplied. Was it to be 
 supposed that the activity and energy which the adequate 
 supply of money had put in operation, and which was giving 
 prosperity and happiness to the country, would suddenly dwarf 
 itself to suit financial notions without a struggle? The inevit- 
 itable result was an expedient to meet the consequent want, 
 and credit was expanded. At the very moment above all others 
 when adequate supply was needed, the opposite course was 
 adopted; and right here lies the true cause of the late panic, 
 wh ch resulted from a money famine and not from an excessive 
 supply. . . . Sir, turn this matter as we will, and look at 
 it from any side whatever, and it does present tbe appearance 
 of being a stupendous scheme of the money-holders to seize the 
 opportunity of placing under their control the vast industries 
 or the nation. Therefore I warn Senators against pushing too 
 far the great conflict now going on between capital and labor. 
 . . Capital rests upon labor; but when it attempts to 
 press too heavily on that which supports it in a free republic, 
 the slumbering volcano, whose mutterings are beginning al- 
 ready to be heard, will burst forth with a fury that no legisla- 
 tion will quell."
 
 176 The Philo$ophy of Money. 
 
 From the foregoing, which is but a small fragment of the 
 immense literature in harmony with the opinions cited, the 
 following conclusions may be digested: 
 
 1. A diminished volume of money always causes a propor- 
 tional diminution in the price of labor and commodities or, to 
 express it otherwise, money becomes dear and everything else 
 cheap. 
 
 2. This redounds to the advantage of the capitalistic 
 class, who are thereby enabled to exact more for their money 
 in services and commodities, to purchase all kinds of stocks 
 and properties at diminished rates, and to foreclose mortgages 
 and collect other forms of debts under such conditions as to 
 make "hard times" a harvest for the creditor class. 
 
 3. The debtor class is compelled not only to yield more 
 services and commodities for the money which it receives or 
 has previously received, but suffers the further hardship of 
 languishing business and enforced idleness or diminished wages; 
 and it should bo remembered that every producer is a debtor, 
 even though he has no specific obligations outstanding; for he 
 will have to aid those who have such obligations by receiving 
 lees prices and wages and by paying relatively increased taxes, 
 salaries, rents and profits to those members of the debtor class 
 who are immediately above him in the social scale, and who 
 will seek to save themselves by shifting the burden of their 
 obligations onto those who are below. 
 
 " ILL fares the land, to hastening ills a prey, 
 Where wealth accumulates and men decay. 
 Princes and lords may flourish and may fade; 
 A breath can make them, as a breath has made; 
 But an honest peasantry, a country's pride, 
 When once destroyed, can never be supplied." 
 
 Q-oldsmith. 
 
 
 "WEALTH is necessary; let us not disclaim against it; every 
 nation needs it to attain the highest achievements in civil- 
 ization. But it is a blessing only as a servant and is destruc- 
 tive as a master." John P. Altgeld.
 
 ) "/ am astonished at nothing in our business life so much 
 as the absence of an earnest, determined endeavor on the part 
 of our men of brains to find the cause of these chronic crises 
 and hard times and then set upon the traek of some remedy 
 tAerefor."REV. HEBER NEWTON. 
 
 A BIRD'S-EYE VIEW OF AMERICAN FINANCIAL HISTORY. 
 
 % 
 
 BY SAMUEL LEAVTTT. 
 
 WHAT may well be called the American system of money naa 
 been gradually evolved, during three hundred years, from 
 the bitter experiences of the most practical people that ever 
 trod this globe. Franklin, Jefferson, Jackson, Calhoun, Clay. 
 Gallatin and Benton were its prophets. But it first began to 
 take definite shape during our civil war under such men as 
 Edward Kellogg, Thaddeus Stevens, Henry C. Carey, Stephen 
 Colwell, Pliny Freeman, Ben Wade, Oliver P. Morton, Henry 
 Wilson and John Thompson; and later, Warwick Martin, Peter 
 Cooper, Thomas Ewing, Wendell Phillips, John E. Williams, 
 George Opdyke, John G. Drew, John P. Jones, William D. 
 Kelley, B. F. Butler and others. 
 
 What first strikes the observer in a bird's-eye view is that 
 the whole modern movement toward a rational money system 
 was started by that much maligned genius, John Law, in 
 France, in 1715. His system was one of the first recent revolts 
 against the tyranny of metal money. He was the real founder 
 of the Bank of France and the present French system. The 
 Encyclopedia Britannica calls him an "unequaled financier." 
 His great thought was plenty of government paper money, and 
 France has kept that thought. Law was finally beaten by 
 politicians and the King's mistresses, when he tried to improve 
 his system. 
 
 Turning homeward, we find the first American coin money, 
 succeeding the wonderfully useful wampum, came very curi- 
 ously coin usually does. In 1652 a mint was set up in Boston to 
 coin silver into "pine tree" money. The silver came mostly 
 
 177
 
 178 American Financial History. 
 
 from the West Indian trade. Our rulers in England then, as 
 now, only busied themselves in stealing from us any good 
 money we could get hold of. Singularly enough we depended 
 largely then upon another class of pirates the buccaneers of 
 the Spanish Main, who spent most of their plunder on our 
 shores, where were the nearest civilized ports. This was a 
 great blessing "a blessed providence" to our Puritan ances- 
 tors, and the coin money economists of those days. 
 
 In 1745 we had another blessed influx of silver. Governor 
 Shirley, of Massachusetts, and his pious Puritans, went over and 
 captured Louisburg, Cape Breton, from the French, with fire 
 and sword, and made a big loot. This so tickled Mother 
 Britain that, for once, she sent us a lot of silver to "ransom" 
 Louisburg. This enabled Massachusetts to steal away the 
 trade of Rhode Island. 
 
 In 1690 the first issue of paper money was made in Massa- 
 chusetts. This was before the establishment of the Bank of 
 England. It was for 7,000. In 1703 15,000 was issued, 
 which was made a legal tender for private debts. In 1716 
 another issue to the amount of 150,000 was authorized. Mark 
 the style of it, as compared with the wild-cat projects of the 
 present Congress, and see which is the most reasonable and 
 conservative, and then inquire if the Farmers' Alliance plan is 
 so foolish: "The bills were to be distributed among the differ- 
 ent counties of the province, and to be put into the hands of five 
 trustees in each county, to be appointed by the legislature, to 
 be let out on real estate security in the county, in specific 
 sums, for the space of ten years, at five per cent, per annum." 
 Another act for 50,000 in bills was passed in 1720, "which 
 resulted in clearing Massachusetts "of debt in 1773 !" 
 
 In 1723 Pennsylvania led a number of States in issuing 
 paper money. In this year a great crisis occurred in England, 
 and the Bank was suspended. The coin of the American 
 colonies was required, and drawn over, in England's selfish and 
 peremptory way, to prepare the bank for resumption. All coin 
 left Pennsylvania, though the State passed lawa raising its 
 value. Then the State issued treasury notes, and kept them 
 in use until 1773, when English jealousy caused Parliament to
 
 American Financial Hittory, 179 
 
 make all such issues void. Some of the money was issued, 
 says Adam Smith, on land security of double the value, and 
 redeemed in fifteen years. It was made legal tender and 
 remained at par with coin for forty years. The necessary 
 notes were redeemed, by their payment for taxes, without loss 
 to any one. This is the familiar history of Pennsylvania and 
 the statement of Franklin. The cutting off of this money was 
 the chief cause of the Revolution. The tea-party in Boston 
 Harbor was only a side-show. 
 
 Continental money was issued by Congress when we had 
 no government no power to tax. Yet if made full legal 
 tender, with no mad promise of coin, fifty million dollars 
 might have been enough. Gallatin says: "It saved the 
 country;" Jefferson, "It expired without a groan;" Calhoun, 
 "It is the ghost conjured up by all who wish to give private 
 banks control of government credit." It was used in place of 
 a war tax, and the people BO regarded it. 
 
 French assign ats broke the spell of royal tyranny in 
 Europe. Such is the power of a live nation to use and absorb 
 money that nine billion dollars' worth of it was issued before it 
 broke down. Even then the cause of the tumble was that it 
 had no suitable foundation. It was founded on land taken 
 from the priests, and naturally fell when that land was 
 returned to the churches. 
 
 Our Coin for a Century. 
 
 We come now to the coin money of the last half of the eight- 
 eenth and the first half of the nineteenth century. Through 
 ignorance of it, our silver folks are dismayed by the fact that 
 BO little silver was coined here before 1878. The great point to 
 be shown is that we had no need to coin, because so much 
 came from abroad. The way metal money flowed here during 
 the wars between England and Spain reads like a fairy story. 
 The treasures of Mexico and South America passed through 
 here and gave much temporary and flitting coin deposits. 
 Then from the opening of the Napoleonic wars until 1820 the 
 most of Europe, including England, was using paper money, 
 go coin came and stayed here. In fact, coin stayed back in our
 
 180 American Financial History. 
 
 Western wilds often when it was scarce in Eastern sections and 
 large cities. Through all smashes and wild-cat times, Western 
 banks paid coin until 1820. Those were good times for plant- 
 ers on new soil. The old Virginia planter, in his blue swallow- 
 tail coat with brass buttons, and his ruffled shirt, always had 
 a pile of doubloons in his desk. He did not know that Euro- 
 pean war and paper money put it there. 
 
 The banks, warned by wild-cat experiences, grasped at all 
 coin as they do now at gold. One bank sucked all there was 
 in North Carolina and owned the State. It was so plenty in 
 the twenties, in New England, that they shipped it to Europe. 
 
 A point never to be forgotten by silver men, in answer to 
 the gold man's statement about small coinage of silver, is that 
 from the foundation of the United States money laws were 
 passed giving legal value to foreign coins. Our mistaken ratio 
 of 16 to 1, instead of 15^ to 1, made it generally useless for us 
 to coin silver, when we could have plenty from abroad that was 
 legal tender. One fact alone shows how immensely we were 
 using our own silver and foreign silver and gold viz., the 
 panic of 1857 was largely due to the demonetization of our 
 small silver and those foreign coins. In 1853 Congress demon- 
 etized all silver halves, quarters and dimes in sums of over 
 $5.00. Much of the reserves of the banks was in these frac- 
 tional silver coins, which had been full legal tender, and in 
 larger gold and silver coins of the United States and other 
 countries. The silver dollars of Spain, Mexico, South America 
 and the United States were worth a premium over gold, and 
 were bought by the Rothschilds and sent out of the country, 
 though they did big service while they stayed here. But the 
 banks did not hold them as reserves. So the demonetization 
 of our small silver deprived the banks of a large portion of 
 their reserves and of paying their circulation therein. 
 
 Up to February, 1857, all foreign gold coins and the silver 
 coins of most nations were, in the United States, full legal ten- 
 der with our coins at the values fixed by our laws; and gold 
 being, since 1834, overvalued in the United States, immense 
 quantities of these gold coins came here and remained. An- 
 other reason why we did not coin silver dollars u found in thia
 
 American Financial History. 181 
 
 fact: gold was superabundant. These gold coins were also 
 held by the banks as reserves in large quantities. 
 
 But on February 21, 1857, Congress demonetized all foreign 
 coins. This took them out of the banks. They went abroad 
 never to return. And this was one chief cause of the panic of 
 1857. The facts above given, properly circulated, should for- 
 ever silence the quibbles of the gold men about the non-use 
 and non-coinage of silver up to 1878. From 1861 to 1878 we 
 used but little coin. 
 
 The gold men sneeringly ask if we want to go on a 50-cent 
 dollar like Mexico. It is true they have worked their diaboli- 
 cal will on some of those weak nations, where the currency is 
 thrown into horrible confusion thereby, and foreign business 
 is made almost impossible by the rise in the gold dollar to a 
 $2.00 dollar. They have come near Mexicanizing us in this 
 respect, but have failed as yet. Their plea for the deposits of 
 workmen in savings banks is like the howl the mortgage 
 people are always raising about the poor widows and orphans 
 of the East, to whom the Western farmer should willingly pay 
 high interest. Wise nations legislate for producers, rather 
 than for interest-suckers male or female. 
 
 United States Banks Wild-Cat and State Banks. 
 
 Ever since the Revolution there has been war between 
 Jefferson's treasury notes and the sharp fellows who wish to 
 collect interest on their debts. In the lush wild-cat times 
 bankers did not care whether they made their scoop by shov- 
 ing out bank notes so far that they would hardly ever come 
 back, or lending interest-bearing credit to their neighbors. 
 Now the telegraph, railroad and redemption banks would 
 make hard sledding for State wild-cats. 
 
 The United States banks (private) were so mixed with the 
 wild-cats for fifty years 1791 to 1841 that they need describ- 
 ing. The first, in 1791, was got up by Federals who hated 
 treasury notes. But fortunately there was much honesty 
 then, and it was so managed that its notes were like full legal- 
 tender greenbacks. Those were halycon days. Wild cats were 
 around, but got little game. They made their first big in-
 
 182 American Financial History. 
 
 flation in New England. Tho Yankees thought they could 
 wing out to any degree when the Anglo-Spanish and the Napo- 
 leon wars made coin so plenty here. 
 
 There was a great rush of banks between 1811 and 1816, 
 when the second United States Bank came in. It was a 
 fraud from the start, violated its charter and was founded 
 mostly on personal notes. But it swung its twenty years. The 
 great plan of the wild-catters was to get its treasury notes, 
 good as gold, and drawing interest, for their red dogs. Right 
 here let us affirm that, for short, all State bank money may be 
 called wild cats, red dogs and shinplasters. For such it al- 
 ways proves in panic times. The Chicago Tribune says that 
 the Democrats are "committed upon both principle and tra- 
 dition against a federal currency committed aleo to State 
 banking." Not so. Jefferson was strong for federal money, i. 
 e., treasury notes. The Whigs were always as much given to 
 wild cats as the Democrats. Again the Tribune tells of 34,- 
 000 who took the benefit of the bankrupt act in 1811-2-3, but 
 says nothing of the hundreds of thousands who failed between 
 1873 and 1890, under the crush of Republican gold resumption, 
 without any such release. Intelligent Democrats could show 
 billions of loss from Republican financiering against hundreds 
 of millions under Democracy. Give the poor devil Democrat 
 his due. He makes a clumsy attempt now to cover his rascal- 
 ity in voting against silver bills by all his talk of returning to 
 wild cats. The cheeky Republicans offer no shadow of a real 
 remedy for our financial ills. 
 
 To return to the time of the twenties. The new, hopeful 
 country kept having booms in spite of bad money. After the 
 close of the war of 1812 15, "Blessed Peace," said Matthew 
 Carey, "came and brought two thousand merchant buyers to 
 Philadelphia." Fortunes were made. It was funny as a oir- 
 ous. The brokers stuffed the United States treasury full of 
 ehinplasters, not good thirty miles from home. Congress said 
 "resume" in 1817. Banks said, "Go to the devil." With twen- 
 ty-two millions "on hand," Congress had to borrow half a mill- 
 ion to keep house on. The big bank was given over to favor- 
 ites, bribery and corruption, but ruled th land. There was a .
 
 American Financial History. 183 
 
 whirligig between the branches of the big bank and the little 
 banks. The latter bought, with their red dogs, from the 
 branches, drafts on Eastern cities. The drafts bought Euro- 
 pean goods. Meanwhile the branches socked it to the wild- 
 catters up to five and ten per cent, a month, till they redeemed 
 their red dogs with the proceeds of another crop. 
 
 In 1818 the president of the big bank resigned when it 
 was near ruin. A new president, Cheves, saved the bank, in 
 the Bank of England fashion, by ruining a lot of small banks 
 and merchants. In 1820 came "stay laws" and a "relief sys- 
 tem." Men could redeem their lands and negroes in two years 
 by paying ten per cent. down. North Carolina had an awful 
 time. Bobber bankers of Newbern became the practical own- 
 ers of the State, and sucked its blood. Were ruling still in 
 1833. 
 
 In 1825 the great Nick Biddle took the presidency of the 
 bank, and ran the whole country, till knocked out by Jack- 
 son. Biddle was the biggest boss yet, moved crops, lent ten 
 millions at a time to the government. Some thought he gave 
 the rising sun a boost. When there was a run, he only allowed 
 his branches to cash their own drafts. In 1832 was high water 
 time for this fine old Philadelphia gent. President Jackson 
 who hated all undemocratic high-kicking, made him pay the 
 government debt from his government deposits. Jackson 
 stopped the abnormal boom in wild lands by his "specie circu- 
 lar," ordering only specie to be taken for United States lands. 
 Then, to check the torrents of extravagance, he ordered the 
 useless thirty-seven millions that he had foolishly put in State 
 banks distributed back to the people of the States. The wild- 
 catters paid eighteen millions, and then all broke, beginning 
 in New York in May, 1837. That was a grand smash. Jack- 
 son had a glimpse of the greenback remedy in his muddled 
 head. Jefferson and Calhoun always had it. 
 
 Parallel with all this was the Mississippi tomfoolery of 
 1830 to 1840. That State borrowed thirty millions on the old 
 personal note plan from Holland, and fooled it away in ten 
 years. Slaves were then the only good assets. These were run
 
 184 American Financial History, 
 
 off to Texas, and "Gone to Texas" (G. T. T.) was a familiar in- 
 scription. 
 
 The College Professor and the Facts. 
 
 While this essay is intended in a general way to voice the 
 sentiments of the Populists, it is incidentally an answer to the 
 speeches of Prof. Laughlin of Chicago University before the 
 Sunset Club and the Bankers' Association. The Professor's 
 most glaring errors were concerning the greenbacks. He says: 
 
 "It seems to me that one of the greatest misfortunes that 
 this country ever suffered was that temporary, and to the 
 present time lasting, intoxication connected with the issue of 
 United States notes or greenbacks. From the foundation of 
 our government in 1789 to February, 1862, the United States 
 government never issued any paper money." 
 
 The Chicago Herald of December 10 voiced the same 
 falsity thus: 
 
 "In fact the government never did anything of the kind 
 until 1862, when Congress authorized an issue of legal-tender 
 notes." 
 
 Are these men simply reckless liars, or are they ignorant 
 of the facts? Here are the facts: From 1812 to 1860, U. S. 
 treasury notes were issued at least twenty times; that is, in 
 every time of emergency, when the bankers' wild-cat money 
 could not possibly keep business going. These notes were re- 
 ceivable for all debts due the government, including interest 
 on the public debt and custom-house dues; and that fact made 
 them universally acceptable by the people better than gold. 
 In these respects they were better than the greenbacks; for 
 never until the infernal exception was put upon them in 1862 
 did the government refuse to receive its own treasury notes. 
 
 Here are most of the dates and amounts of those issues 
 all by acts of Congress readily traced: June 3, 18 2, $5,000,- 
 000; February 25, 1813, $10,000,000; March 4, 1814, $10,000,000; 
 December 26, 1814, 825,000,000; February 14, 1815, $25,000,000; 
 October 12, 1837, $10,000,000; March 21, 1838, $10,000.000; May 
 31, 1840, $5,000,000; June 30, 1842, $5,000.000; August 31, 1842, 
 $6,000,000; July 22, 1816, $10,000,000; June 28, 1847, $23,0^0,000; 
 December 23, 1857, $20,000,000; December 17, i860, $10,000,000,
 
 American Financial History. 185 
 
 Is that lie nailed ? The above treasury notes were ham- 
 pered in various ways. The money-lenders persuaded Con- 
 gress that it would be "contrary to the laws of the Modes and 
 Persians" if the notes drew no interest. So they were gener- 
 ally heavily handicapped in that way. Sometimes they only 
 drew one mill per annum, sometimes nothing. When they 
 drew none the Shylocks at once cried that the country was 
 ruined. They liked them well enough plus interest, because 
 they were sharp enough to get hold of them and pull in the 
 interest, while they managed to cram the U. S. treasury full of 
 their wild-cat stuff. 
 
 To thoroughly verify these serious statements, let us look 
 at the statutes under which these issues were made and the 
 particulars of their issue: 
 
 Act of June 3, 1812 (Statutes 2, p. 766). This law author- 
 ized the issue of $5,000.000 treasury notes, to run one year, 
 bearing five and two-fifths per cent, interest. They were made 
 receivable for all debts due the government, and were to be 
 paid to such public creditors and other ^persons as were will- 
 ing to receive them. They might also be used to procure 
 loans, or might be placed to the credit of the treasury in banks 
 at par and accrued interest. 
 
 Act of February 2.5, 1813 (Statutes 2, p. 801). This law 
 authorized the issue of $10,000,000 treasury notes to mature 
 in one year, bearing five and two-fifths per cent, interest per 
 annum. Terms same as act of June 3, 1812. 
 
 Act of March 4, 1814 (Statutes 3, p. 100). Authorized an 
 issue of $10,000,000 on same terms as above. No charge to the 
 government was to be made by the banks which credited the 
 notes. 
 
 Act of Dec. 26, 1814 (Statutes 3, p. I&/).-Authorized the issue 
 of $25,000.000 treasury notes in place of a loan of $25,000,000 
 previously authorized. Ten million of these notes were to be 
 applied to the payment of glO.000,000 previously borrowed. 
 Otherwise they were like the above. 
 
 Act of February 14, 1S15 (Statutes 3, p. 213). This law 
 authorized the issue of $25,000,000 treasury notes in addition 
 to other issues. Up to this time the Secretaries of the Treaa-
 
 )96 American Financial History. 
 
 ury, Mr. Gallatin and Mr. Crawford, had complained that the 
 treasury notes so far issued were made too large for common 
 circulation, though their standing among the people was good, 
 and the people were desirous of having them. They say treas- 
 ury notes have taken the place of coin and equalized the ex- 
 change throughout the country. To meet the wishes of these 
 Secretaries and of Jefferson and Madison, as well as the people, 
 these $25,000,000 treasury notes for circulation were author- 
 ized and issued. The most of them were required to be less 
 than $100 in denomination, and to be payable to bearer, 
 while those of $100 and over were to be made payable to 
 order and to pay by endorsement, and were to bear five and 
 two-fifths per cent, interest. The smaller ones were to bear 
 no interest. They were also, for the first time, made receivable 
 for six per cent, bonds. They were made to circulate as mon- 
 ey, and to have the characteristics of coin, but they were not 
 redeemable therein. They were legal tender to the United 
 States. These notes, after being paid into the treasury, were 
 to be reissued. 
 
 When these $25,000,000 treasury notes of small denomi- 
 nations were made to circulate as money, and to bear no in- 
 terest, the indignation of all the banks in the country was 
 aroused. They saw that if those notes went out "among the 
 people, and became the money of the country, there would be 
 an end to the circulation of bank notes. Such was the truth. 
 There was, therefore, a general combination in New England, 
 New York, Delaware and Pennsylvania to kill them off. The 
 old Bank of the United States, chartered in 1791, the charter 
 of which expired and which was not renewed in 1811, was then, 
 as the law allowed, closing up its affairs. The debts of the 
 people to this bank were very large. The bank was pressing 
 for payment. The people presented these treasury notes, 
 which did not bear interest, in payment. The bank, to destroy 
 the credit of the notes, and to force the recharter of a national 
 bank, refused to receive the notes of the government in pay- 
 ment to the bank. As the bank would not receive the notes 
 from the merchants, the merchants were reluctantly corn- 
 palled to refuse to receive them for debts due and for good* sold.
 
 American Financial Hiitory. 1ST 
 
 The New England banks, and those of Delaware, were also 
 deeply involved in this conspiracy to destroy the credit of these 
 treasury notes, as all such are now. The embargo and non- 
 intercourse laws of Jefferson and Madison had destroyed the 
 carrying trade of New England, and had caused a suspension 
 of the New England banks in 1809 and 1810. The people of 
 New England were, therefore, greatly opposed to the war with 
 England. They did all they could to cripple the government 
 in carrying it on. They refused all loans, even of bank notes, 
 and were very hostile to all treasury notes, especially to those 
 intended to take the place of bank notes, as were those of 1815. 
 
 By a general combination between State banks, the old 
 national bank bondholders and bullion brokers, these notea 
 of the United States were forced to a discount for a short time. 
 One of the strongest arguments in favor of having all treasury 
 notes made full legal tender is here presented. Had they been 
 legal tender to the people, as well as to the government, all the 
 efforts of the banks and brokers to reject them and reduce 
 their value would have been fruitless. If the legal character 
 were removed from the greenbacks the national banks would 
 at once discredit them today. 
 
 Immediately after these efforts of the banks to discredit 
 treasury notes, an application was made to Congress for a 
 charter for another U. S. Bank, which proposed to take from 
 the government, as part of its capital, $15,000,000 of these same 
 treasury notes, to withdraw them from competition with bank 
 notes. (Just as the rascally conspirators at Washington are 
 now trying to do with 346 million greenbacks.) 
 
 Mr. Madison vetoed the bill, principally on account of this 
 provision. But $28,000,000 of bonds were substituted for treas- 
 ury notes, as capital of the bank; and by a combination of the 
 Federal party and a few Democrats it was chartered. The 
 charter provided that no other such bank should be chartered 
 by Congress for twenty years. This implied, also, that all 
 treasury notes intended to circulate as money should be with- 
 drawn, and that this bank should furnish all the national paper 
 circulation for twenty years. 
 
 For this privilege the bank paid $1,500,000, This contract
 
 188 American Financial History. 
 
 on the part of the government was disgraceful, but, having 
 been made, it had to be carried out; and it was carried out, 
 as the following acts of Congress show: 
 
 The Act of March 3, 1817 (Statutes 3, p. 377). The second 
 Bank of the United States had just gone into operation. Con- 
 gress was compelled to comply with its part of the contract It, 
 therefore, passed this law, which repealed all laws authorizing 
 the reissue of the "treasury notes of 1815." But the people 
 had these government notes, and they preferred them to bank 
 notes or coin. They knew that the repeal of the law authoriz- 
 ing their reissue could not affect the value of those then in 
 their bands, for a valuable consideration paid the government. 
 They, therefore, held on to the notes (as our people should 
 now, in spite of Sherman, Cleveland & Co.) Instead of paying 
 them into the treasury, where the law required them to be 
 destroyed, the people held onto them, and used them in busi- 
 ness, greatly to the annoyance of the bank and ot the Secre- 
 tary of the Treasury, then a bank man (Mr. Dallas). This 
 officer ordered the collectors of revenue to refuse to receive 
 these notes for duties on imports, supposing that by this means 
 he could injure their credit and force their presentation at the 
 treasury for payment in coin or national bank notes, that they 
 might be canceled. This gave rise to a suit in Boston. A 
 firm presented treasury notes in payment of duties on imports, 
 for which the law creating them provided that they should be 
 received. The government refused to receive them, and 
 brought suit for the duties. The defendants pleaded a tender 
 of treasury notes. The government answered that they were 
 not legal tender. Judge Story, in 1819, heard the case, and 
 decided for the defendants. The decision is that "Treasury 
 notes are legal tender for everything for which the govern- 
 ment makes them receivable." This decision ia in 2 Mason, 
 pages 1 to 18. This decision, though against the government, 
 was never appealed to the Supreme Court. It, therefore 
 stood as the law of the land. 
 
 The Act of May 3, 1822 (Statutes 3, p. 675). Treasury notes 
 etill remained out among the people, to the annoyance of the 
 bank and the Secretary. The decision of Judge Story raised
 
 American Financial History. 189 
 
 instead of depressing them in the estimation of the people, and 
 increased the anxiety of the bank and the Secretary respecting 
 them. The notes did not come to the treasury for destruction. 
 (Just so the people acted when John Sherman tried to make 
 them take 5-20 bonds and give up the greenbacks.) They re- 
 mained among the people until May 3, 1822, when Congress again 
 came to the rescue of the bank and passed the law of that date 
 which provided that these treasury notes should not be 
 received by any collector of revenue in the United States, and 
 that they should be received and paid at the treasury only. 
 All that came into the treasury were to be destroyed. The 
 people wished to retain these notes; but the bank forced Con- 
 gress to act against them; and Congress, by destroying their 
 receivability, compelled their surrender by the people. We 
 hear no more of treasury notes thereafter until 1837, when, as 
 usual, the necessities of the government again called them into 
 being. 
 
 The Aot of October 12, 1837 (Statutes 5, p. 201). The banks 
 had all suspended, with nearly $40,000,000 government funds. 
 Not one year before the law had made these banks public 
 depositories, with their promise that they would always pay 
 coin for all liabilities. The government had, in 1835, paid off 
 the last dollar of the national debt. The surplus then in the 
 treasury was near $40,000,000. This was in the banks. The 
 government had no money to pay ordinary expenses, unless the 
 treasury used suspended bank notes. This Mr. Van Buren, 
 the President, refused to do. He called Congress together to 
 meet the emergency. Its remedy for the emergency was treas- 
 ury notes (as it should now be), which Jefferson says are the 
 only reliance of a nation. This act of October 12, 1837, provided 
 for the issue of $10,000,000 treasury notes, in denominations 
 not less tnan 850, running one year. The law left the inter- 
 est which they were to bear discretional with the President 
 and the Secretary of the Treasury; but in no case was it to 
 exceed six per cent. Congress appeared too timid to make 
 these notes money bearing no interest. The Secretary, know- 
 ing that the people needed them as money, complied with the 
 law by making many of them bear, one mill interest per annum.
 
 190 American Financial History. 
 
 As such they circulated freely as money, and the people were 
 delighted to get and use them. They answered all the pur- 
 poses of coin, and equalized the exchanges throughout the 
 country. The banks did not, at that time, possess sufficient 
 power to injure them. Men now living remember them and 
 their usefulness, although, imitating the foolishness of the Bank 
 of England, they were never paid out of the treasury but once. 
 
 The Act of May 21,1838 (Statutes 5, p, 228). This act 
 authorized the reissue of the $10,000,000 treasury notes issued 
 under the act of 1837, which had been canceled. They should 
 have been used till worn out, and then replaced ad infinitum. 
 It has taken time and a great war to open the eyes of the peo- 
 ple and Congress to see what Jefferson saw in 1813. And now, 
 again, many are forgetting the facts. 
 
 The Act of May 31, 1840 (Statutes 5, p. 370). This law 
 renews the act of 1837, relating to the issue of treasury notes, 
 and makes the following modifications: 1. That they were to 
 be issued in place of those redeemed; not to exceed in this issue 
 $5,000,000. 2. They were to be redeemed in less than a year, 
 if the treasury was in a condition to redeem them. 3. When 
 ready to redeem them, the Secretary of the Treasury was to 
 give notice. 4. After due notice, these notes should cease to 
 bear interest, if they remained out. This act was to continue 
 only one year. It is evident that Congress supposed the 
 necessity for issuing treasury notes would soon cease. But it 
 was mistaken, Treasury notes continued to be issued up to 
 1818. 
 
 The Act of July 4, 1840 (Statutes 5,p. 385). This was the 
 first Independent Treasury act of the days of Van Buren. It 
 had good features, but was badly bungled. The money of the 
 government was to be kept by the government (instead of the 
 banks), in the mints, custom-houses, post-offices and treasury 
 building. The fool part of it was that after January 3, 1843, no 
 payment should be made to the government in anything but 
 gold and silver coin. The banks were suspended. The gov- 
 ernment was being sustained by treasury notes. But still 
 this law provided that after Jan. 3, 1843, treasury notes should 
 be excluded from th treasury as well as bank notes. An ap-
 
 American Financial History. 191 
 
 peal was made to the people in that year's election, upon this 
 law, and Van Buren and his coin payments were knocked out 
 by Harrison with wiser plans. 
 
 The Act of July 21, 1811 (Statutes 5, p. 438) This was 
 among the first Whig acts, and they in turn made fools of 
 themselves. They favored a national bank, but opposed treas- 
 ury notes. The law provided for the issue of $12,000,000 six 
 per cent, bonds. The principal purpose was to redeem the 
 good treasury notes of the Democrats. A Pittsburg 
 man was sent to England to sell the bonds. Though the 
 United States had paid its national debt in 1835, the bonds 
 were no go. The Whigs, having failed to found a bank and 
 sell these bonds, were compelled to rely upon the much-de- 
 spised treasury notes of the Democrats. 
 
 The Act of April 15, 1842 (Statutes 5, p. 473), was a final 
 effort to shove the bonds. They were increased to $17,000,000, 
 the time extended indefinitely up to twenty years. They could 
 be sold at less than par. The rich, strong young nation could 
 not doit, though taxes and duties were pledged for payment. 
 The war was going on between the Whig Congress and sen- 
 sible President Tyler. The latter advocated the issuing of all 
 the paper as well as metallic money by the government; but 
 Congress wished the money issued by a national bank. The 
 President vetoed the bank bill. Congress, by way of heading 
 him off, passed the act to make treasury notes bear six per 
 cent, interest, to hinder their being used as money. 
 
 The Act of June 30, 1842 (Statutes 5, p. 766) This pro- 
 vided for $5,000.000 treasury notes to run one year. Interest 
 five per cent. Otherwise like most of the others, as to legal 
 tender, payment to public creditors and placing them in banks. 
 
 The Act of Aug. 31, 1842 (Statutes 5, p. 581), shows a linger, 
 ing hope of selling the bonds. If not successful, the govern- 
 ment was to issue $6,000,000 more of treasury notes (trotting 
 out the despised pack-mule again), which might even be re- 
 issued. What a let-up! Br'er Fox Sbylock, he lie low! 
 
 The Act of March 3, 1843 (Statutes 5, p. 614), authorizes 
 the issue of new treasury notes to supply the place of thow 
 redeemed.
 
 192 American Financial History. 
 
 The Act of July 22, 1846 (Statutes 5, p. 39), The Democrats 
 resumed power in 1845. This act authorizes $10,000,000 treas- 
 ury notes in place of those destroyed. 
 
 The Act of August 6, 1846 (Statutes 9, p. 59), finally estab- 
 lished the independent treasury on a sensible basis. It made 
 all treasury notes and gold and silver coins equal in payment 
 of all debts to the government. This held till 1861, and many 
 of the provisions are still law, but badly enforced, as when our 
 recent Presidents deposited many millions in banks. 
 
 The Act of Jan. 28, 1847 (Statutes 9, p. 118), authorized 
 $23,000,000 (more than $500,000,000 now) to fight the Mexican 
 war. No interest was fixed. They mostly drew one mill, and 
 the people gladly used them as money. 
 
 The Act of Dec. 23, 1857 (Statutes 11, p. 257), provides for 
 $20,000,000 treasury notes to take the place of coin, the banks 
 having suspended with the coin in their vaults. (Heaven, or 
 something, generally saves the banks.) These were, like most 
 of the previous issues, with nominal interest. The plain people 
 took them gladly. 
 
 The Act of Dec. 17, 1860 (Statutes 11, p. 121), provides for 
 $10,000,000 treasury notes, running one year, at six per cent. 
 The interest was to run and the notes remain out until sixty 
 days after notice of readiness to redeem. Otherwise they had 
 the old provisions. 
 
 The Act of Feb. 8, 1861, authorized the issue of treasury 
 notes, or a loan of $25,000,000 to take up treasury notes. 
 
 The Act of March 2, 1861 (Statutes 12, p. 178), provides for 
 a loan of $10,000,000 to takfi up treasury notes, and for govern- 
 ment expenses. Same old story. If bonds not sold, then 
 more notes. 
 
 This brings us to the act of July 17, 1861, when the gigantic 
 $250,000,000 of loans and notes came up. The further history is 
 well known. That just given will surprise those who thought 
 treasury notes began with the rebellion. 
 
 Safety Fund Suffolk and Redemption Banks. 
 
 As many of the foolish propositions now put forth for "re- 
 forming the currency" are only feeble imitations of the Safety
 
 American Financial History. 193 
 
 Fund, Suffolk System and Redemption Bank System that 
 arose before the Rebellion, a brief account of them will be giv- 
 en here. In the thirties and forties there were as many so-called 
 systems as there were States. The Suffolk System of Massa- 
 chusetts, among those first started, alone deserved the name 
 of system. In 1829 that State decreed that no bank should 
 operate unless 50 per cent, of its capital was paid in coin. Notes 
 must not exceed 25 per cent, of the capital. Liabilities, ex- 
 cept deposits, must not exceed twice the capital. Such pro- 
 visions, however, amounted to little, because, much of the 
 loans being simple credits, there was small inducement in the 
 strong banks to overissue notes. As no provision was made 
 for reserves, the coin to set a bank in motion could be bought 
 ana sold again right after the organization. The Redemption 
 system, afterward adopted, was much better, but, as will be 
 hown, only a harm in panic times. 
 
 The New York banks were placed mostly in New York City 
 and the Hudson River towns. In 1829 the Safety Fund Sys- 
 tem arose there. It allowed the banks under it to issue notes 
 to twice the amount of their paid-up capital, and loans to twice 
 and a half the amount. Every bank under it had to pay the 
 State Treasurer, annually, one-half of one per cent, upon its 
 hare capital these payments to continue till each bank had 
 a sum equal to three per cent, of its share capital. The 
 amounts so paid were to be held as a common fund for the 
 discharge of notes or other liabilities of any bank of the system. 
 
 In 1841 and 1842 eleven of the Safety Fund banks failed, 
 making a loss to the creditors of $2,588,933. The fund was 
 then $86,274. The whole amount of the fund to September 30, 
 1848, was only $1,876,063. The balance of the loss was pro- 
 vided by the State which was to be reimbursed by further 
 additions to the fund. That was very nice for the banks. In 
 1842 the act was so amended that the fund became chargeable 
 only with the losses to the public on the note circulation, just 
 as it is the case with the national banks now. 
 
 In 1838 New York founded the "Free Banking System," by 
 which banks could be formed without application to the legis- 
 lature. These associations were required to deposit with the
 
 194 American Financial History. 
 
 State Comptroller United States or State stocks equal to a five 
 per cent, stock; or bonds and mortgages on improved real 
 estate worth twice the sum secured, and equal in amount to 
 their note circulation. The Comptroller issued the notes to 
 them. Up to 1843 twenty-nine of these banks failed circula- 
 tion $1,233,374; nominal value of securities, $1,555,338. These 
 produced $953,371, or 74 per cent, of the circulation secured. 
 The law was then amended to exclude all but United States 
 stocks, and those of the State, which must be equal to six per 
 cent. 
 
 A wiser provision had been adopted in 1840, requiring all 
 the State, banks to redeem their notes, either in New York 
 City, Albany or Troy, at a discount of one-half of one per 
 cent. In 1851 this discount was reduced to one-quarter of one 
 per cent. After 1851 two New York banks started the 
 Redemption System. The notes of such of the country banks 
 as kept deposits with them were returned, the redeeming 
 banks dividing the discounts between themselves and the 
 issuers. This system was useful, as it forced a constant 
 redemption; but see how it worked io 1857. 
 
 After 1838 no more Safety Fund banks were chartered, and 
 the system gradually lapsed. But a curious story could be 
 told of how it ran through the West. That region was deluged 
 with "safety" money all but the safety. In 1846 the new Con- 
 stitution of New York took from the legislature all power to 
 pass any act granting any special charter for banking purposes; 
 such organizations to be under general laws. After 1850 
 bank stockholders were to be liable to the amount of their 
 shares for all the debts, and holders of notes to be preferred 
 creditors. 
 
 Now for the Redemption Banks in 1857. These banks, 
 useful, in their way, in ordinary times, did harm in that panic. 
 A few years before a new source of profit was suggested to 
 some New York banks. If the redemption that was distributed 
 among the money-brokers could be monopolized by one or two 
 institutions, it would yield a rich revenue; and it could easily 
 be attracted by reducing the rates of redemption so low as to 
 exclude individual competition. The system was based some-
 
 American Financial History. 195 
 
 what upon the Suffolk System. Coupled with the payment of 
 interest on country deposits, it had grown into astonishing 
 activity before 1857. It worked admirably as a piece of 
 machinery, with the popular commendation that it restricted 
 the bank currency by enforcing prompt redemption, and saved 
 the merchants a heavy brokerage. It was a great convenience 
 in the first days of the panic, when private capital was with- 
 drawn from the purchase of currency, and when the mer- 
 chants, but for the redeeming banks, would have been over- 
 burdened with unavailable notes. 
 
 But the redemption system, like everything else that was 
 susceptible of abuse, was turned aside from its legitimate pur- 
 pose and made to answer a mischievous end. The low rate at 
 which the bills were taken in New York accelerated their 
 return in bulk, as a basis of exchange, or for credit in account. 
 Thus their distinctive character as circulation was in a great 
 measure destroyed. The cheap redemption, so desirable in a 
 common state of the market, became virtually a premium on 
 the currency of New York. The tendency, then, was to take 
 it out of a healthful circulation, and throw it back to its 
 source, whereby it profited nobody so much as the stock- 
 holders of the express companies. The country banks might 
 keep their own bills in a perpetual circulation, by exchanging 
 them with each other, and thus creating a trade in them. 
 The same packages were not unfrequently kept unopened in 
 the circuit, and reissued in bulk, as often as they were needed 
 to supply balances. 
 
 In a panicky time such redeeming banks must either put 
 more capital into the service or reject the bills. In 1857, in 
 spite of the best management, the currency circuit was kept 
 up; the bills of one bank were paid for the bills of all the 
 others. 
 
 Another evil arose from these banks. The credit given to 
 an unsecured currency by their indorsement gave it a wide 
 circulation, to the displacement of bills that were based upon 
 State and United States stocks. It was now seen that this 
 credit had no other basis than a current deposit by the issu- 
 ing bank, which deposit was in very small proportion to its
 
 19f American Financial History. 
 
 outstanding bills; and that the redeeming bank was prompt to 
 the hour in repudiating those bills if the deposit was not 
 maintained. This was a fallacious credit, entirely independent 
 of the separate ability of the issuing banks. The general 
 result was that biHs were likely to fail in transit, and they 
 would not then be admitted as a deposit, which would involve 
 the rejection of others. And so the row of bricks began to 
 tumble in both directions. 
 
 There was no incident of that panic that spread its terrors 
 abroad with such sure and rapid steps as the rejection, by the 
 redemption banks, of bills which they had been accustomed 
 to receive on deposit. If it had been possible to remove all 
 other causes of excitement, that alone would probably, have 
 involved the suspension of specie payments. It filled all the 
 shops of the country with alarm. It created mobs in the sav- 
 ings banks, and pushed forward the panic, by exciting the 
 fears of the multitude. 
 
 The Example of France. 
 
 Professor Laughlin has the gall, as few of his confreres 
 have, to appeal to "the example of France" after the Prussian 
 war of 1871, in not "interfering with her media of exchange." 
 It is hard to tell whether his statement is based upon impu- 
 dence or ignorance. She interfered with all the ideas of pro- 
 priety entertained by his clique in a way that has been secretly 
 their despair ever since. Yet hear his glorification of a 
 scheme that cuts all the ground from under him. He says: 
 
 "Prance borrowed largely, collected large amounts of cap- 
 ital by the creation of her national debt, and, on the other 
 hand, retained her circulating medium in so perfect a condi- 
 tion that the moment the war was over she slipped along 
 smoothly upon the wheels of industrial success and prosperity, 
 without any derangement of her business. And, during that 
 time, she carried through one of the most magnificent schemes 
 of exchange, in the form of the payment of indemnity, that 
 has ever taken place in history. She actually paid that foreign 
 indemnity of the war to Germany practically without derang- 
 ing the rate of exchange in France." 
 
 He don't tell how. Don't tell that she flooded all the 
 avenues of trade with her paper money, and thus made her
 
 American Financial Histoi'y. 197 
 
 goods so plenty and cheap that Germany bought them instead 
 of her own, and was then in turn nearly bankrupted; so that 
 France paid three-quarters of the "milliard" in French goods ! 
 
 But hear the true story from Wendell Phillips, an all- 
 round, up-to-date reformer, whose motto was, "Act in the liv- 
 ing present." When the monopolizers of black men were 
 beaten he turned to face the monopolizers of all men and 
 women. Here is his eloquent picture: 
 
 "France has just paid Germany one billion dollars. Her 
 chief cities have been sacked and plundered. Humiliated by 
 defeat, torn by civil dissensions, she laughs, while all the rest 
 of Christendom wade through the mire of bankruptcy. Her 
 ships are full busy, and what little other nations do is in car- 
 rying to and fro her manufactures. Her homes are happy, 
 her streets crowded with passing trains laden with goods; all 
 her mills hurrying night and day to get even with her demand 
 upon them. Labor walks rejoicing and capital sleeps easy, 
 fat with its gains. What magician has done this? Paper 
 money. Like the rest of the nations, she ran to its protection 
 during the stress and strain of her German war. Unlike and 
 wiser than the rest of us, she has not hurried back to coin. 
 Wiser than we, she received the paper she offered to others. 
 This honesty has its reward. Her paper is, to-day, more 
 valuable than gold." 
 
 Among the great results of this policy were an abundance 
 of gold and silver coming from abroad, until $1,200,000,000 was 
 found to be in the country. 
 
 Lest some may doubt the statement about the Germans 
 only getting a little gold for that indemnity, an extract is here 
 given from "Our Money Wars," p. 152: 
 
 "Ivan C. Michels says: 'The indemnity from France to 
 Germany, after the war of 1870-71, including interest at n've 
 per cent, per annum, amounted to 81,060,209,015. After credit- 
 ing France with the value of certain railroads in Alsace and 
 Lorraine, the amount of indemnity due Germany was 8998,- 
 172,069 or 4,990,860,319 francs, which was paid by the French 
 government through the Bank of France. At my request the 
 Bank of France furnished to me several years ago the following 
 statement as to the mode of having paid said indemnity: 
 
 Francs. 
 
 In bank notes of the Bank of France 125,000,000 
 
 In French gold coins 273,003.050 
 
 In French silver coins 239.291,875 
 
 In German bank notes 105,039,045
 
 198 American Financial History. 
 
 Bills of exchange drawn in thalers 2,485,513,729 
 
 Bills drawn on Frankfurt in florins 235,128 152 
 
 Bills drawn on Ham burg in marksbancs 265,216,990 
 
 Bills drawn on Berlin in reichsmarks 79.072,309 
 
 Bills drawn on Amsterdam in florins 2~>0,540,821 
 
 Bills drawn on Antwerp and Brussels in francs 295.701.516 
 
 Bills drawn on London in pounds sterling 637,349,832 
 
 Total francs 4,990.860.349 
 
 " 'The patriotic people of France raised the vast sum by a 
 loan in less than six months from the time the government 
 appealed to them. Germany expected to receive for years to 
 come five per cent, per annum on the indemnity bonds; but 
 the Bank of France, through the French bankers, drew on 
 Germany, England, Scotland and Belgium, and in four months' 
 time the whole indemnity was paid. Never in the history of the 
 world has this financial transaction been equaled, and I doubt 
 that any other banking institution could have succeeded so 
 well as the Bank of France. Germany expected the payment 
 in gold coin or bullion, having previously and purposely de- 
 monetized silver. But the fact remains that actually in gold 
 only 273,003,050 francs, equal to $54,600,610, was paid by the 
 Bank of France, and that sum only left France, was remelted 
 in Germany, and coined into reichsmarks. England, with her 
 gold standard, had to part with her gold to the amount of 637,- 
 348,832 francs, equal to $127,469,964. Bills of exchange on the 
 German bankers throughout the German empire, especially on 
 Hamburg, Berlin and Frankfurt, came to 3,064,901180 francs, 
 equal to $612,986,236, nigh on two-thirds of the whole amount 
 of the indemnity. This magnificent stroke of finance on the 
 part of the Bank of France and the French bankers came near 
 ruining the leading German bankers; and forty-one banking 
 houses throughout the German empire had to suspend tempo- 
 rarily, not being able to honor the drafts made upon them. The 
 extravagance of the German people during the war of 1870-71 
 brought them into debt to France for luxuries, wines, etc., to 
 an enormous extent; and when the Bank of France purchased 
 bills of exchange from the French bankers, who drew on their 
 German correspondents, a panic ensued, and the Germans 
 suffered more than is generally supposed.' " 
 
 The above from Michels shows that he saw but dimly what 
 Phillips saw so plainly, that government paper money, nour- 
 ishing all industries, gave France that victory. Michels catches 
 a glimpse of the truth when he speaks of luxuries, wines, etc. 
 To get a clear view of the French financial genius we have 
 to go back to 1818, when Louis Philippe abdicated and the re-
 
 American Financial History. 199 
 
 public was founded amid great confusion. The French have 
 an instinct for finance far superior to anything yet shown by 
 our rulers at least-^in England and America. "Paris," says 
 Victor Hugo, "is the city of the initiative." It is not afraid to 
 start things. It is not, like Washington and New York, al- 
 ways asking what London would do or think. Taking Louis 
 Blanc's advice in 1848, it started national work-shops to insure 
 the employment of surplus labor. Those did good for a time, 
 but they were soon perverted and destroyed by a treacherous 
 Jew who got hold of them. 
 
 Another new departure was more successful. "Besides its 
 regular financial operations," says the London Times of Febru- 
 ary 16, 1849, "the Bank of France made vast advances to the 
 city of Paris, to Marseilles, to the Department of the Seine, and 
 to the hospitals, amounting in all to 260,000,000 francs. But 
 even this was not all. To enable the manufacturing interests 
 to weather the storm, at a moment when all sales were inter- 
 rupted, a decree of the National Assembly had directed ware- 
 houses to be opened for the reception of all kinds of goods, 
 and provided that the registered invoices of these goods so 
 deposited should be made negotiable by indorsement. The 
 Bank of France discounted these receipts. In Havre alone 
 18.000,000 francs was thus advanced upon colonial products, 
 and in Paris 14,000,000 on merchandise. In all 60,000,000 francs 
 was thus made available for all the purposes of trade. Thus 
 the great institution had placed itself, as it were, in direct con- 
 tact with every interest of the community, from the Minister 
 of the Treasury down to the trader in a distant part. Like a 
 huge hydraulic machine, it employed its colossal powers to 
 pump a fresh stream into the exhausted arteries of trade, to 
 sustain credit and preserve the circulation from complete 
 collapse." 
 
 How like "a grimacing dance of apes" our American way 
 of handling financial crises looks, in comparison with the above. 
 The Bank of England. 
 
 Prof. Laughlin showed the usual gold-bug besotted wor- 
 ship of British finance in this: 
 
 "In the Bank of England the first moment of stringency
 
 200 American Financial History. 
 
 the rate of discount is raised. That has the effect or prevent- 
 ing all unnecessary loans. The borrower who has good collat- 
 eral will get the money if he is willing to pay an increased rate. 
 Our system is such that we can loan until we come to the legal 
 limit; and is deficient in that respect, as we cannot loan at a 
 greater discount because of the iniquitous action of the usury 
 laws. You can help a customer by increasing the rate. Just at 
 the moment of the greatest stringency our American system is 
 deficient." 
 
 Ordinary decorous language would fail to characterize that 
 infamous statement. The fact is that the British system is 
 utterly brutal. Our "iniquitous usury laws" prevent a man 
 from giving everything he has to the banks in hard times. The 
 British system is that of Jay Gould in his gold corner of 1869. 
 He settled with his debtors by "taking all they had." He was 
 merciful, and forgave them the balance; which is the usual 
 stock exchange style. 
 
 In coin-paying eras corrupt governments and Shylocks 
 have debased coins to make them go further. In these credit- 
 mongerkig times they try to bring their coin basis down to one 
 metal, gold, and clamor for extreme fineness of that, in order to 
 make their inverted pyramid of credit go further and sell 
 dearer. The policy of Great Britain, for instance, has been to 
 make gold, its standard, so dear and inaccessible to the for- 
 eigners and the debtor class that they would find the other 
 commodities in the market cheaper than the gold in the market, 
 so that settlements in other commodities would be prefer- 
 able. The retention of gold in the Bank of England, by rais- 
 ing discounts in panicky times, though murderous ("kindness," 
 says Mr. Laughlin) to individual active business men, is a 
 necessary factor in this piratical scheme, and the fulcrum 
 upon which England derricks into her treasure vaults the 
 plunder of the whole world. Business is made a lottery, turn- 
 ing out dazzling prizes that keep merchants from rebellion. 
 Long-headed American Shylocks hope to see the United States 
 as much more successful in plundering the globe, in this way, 
 as our country is larger than England. 
 
 Finally, as to Laughlin, with what bitter scorn this state, 
 ment f rom the "closet scholar" will be greeted by the thou-
 
 American Financial History. 201 
 
 sands of manufacturers who, during panics, have had to shut 
 their factories for lack of cash "to pay the hands" though 
 they had all but gilt-edged collateral: 
 
 "The monetary function has to do solely with exchanges of 
 goods; it hasn't anything to do with their production." 
 
 The Washington "Currency Reformers." 
 
 In finishing this bird's-eye view of the financial history of 
 this country, a brief review of the current financial plans can 
 not well be avoided. It may be said of them, in a general 
 way, that no other set of robbers ever before attempted to 
 secure a law guaranteeing them unrestricted right to plunder 
 with unlimited government protection. The out and out 
 black-flag pirates, as represented by Walker, of Massachusetts, 
 have a plan as simple and explicit as a patent medicine. It 
 runs thus: "Retire the greenbacks, kill .silver once for 
 all, and let the bankers manage the currency." This obsolete 
 idea, that banks should issue money, is showing all the vim of 
 a death struggle. But a thousand columns of speeches in the 
 Congressional Globe on the safety of the national bank system 
 are answered by this solitary fact: In the year 1893, 360 
 banks west of the Alleghanies, owing $125,000,000, went to 
 smash, and about a dozen bankers are now in prison or exile, 
 while many more escaped as by tire. 
 
 THE BALTIMORE PLAN, which a while ago had the sanction 
 of the Comptroller, Secretary of the Treasury and the Presi- 
 dent, is, in a word, a scheme for issuing circulating notes by 
 both national and State banks, otherwise than upon the 
 pledge of government bonds as now. The banks are to issue 
 notes upon their own assets, supplemented by a deposit of a 
 certain amount of greenbacks, as a safety and redemption 
 fund. The theory of this plan is that when any special 
 demand for currency arises the banks will make a special 
 issue of notes to supply it; and that as soon as this demand 
 ceases the banks will retire the notes it has called out. Thus 
 the quantity of currency available will, it is assumed, never 
 be either deficient or excessive; and there will never be at any 
 point either a monetary stringency or a monetary plethora.
 
 202 American Financial History. 
 
 Were the function of currency exclusively that of facilitating 
 exchanges, such a system (like that for 3-65 interconvertible 
 bonds) might be useful. But currency serves the additional 
 purpose of measuring the price of commodities; and since its 
 relalion to those commodities is deter mined by its volume, any 
 change of its volume changes its value also, and consequently 
 impairs its stability as a measure of prices. 
 
 Again, as to the State bank feature of the Baltimore plan, 
 the idea prevails extensively in the agricultural districts of 
 the West and South that the chief business of a bank is to 
 lend money to borrowers. That is why they clamor for the 
 removal of the ten per cent, tax on State banks. An abund- 
 ance of greenbacks and silver would do away with most of the 
 need of borrowing from banks. That's what's the matter with 
 the banks. 
 
 No further mention is needed here of the schemes of 
 Carlisle, Springer, Vest and others. They seem all dead at 
 this writing, and they certainly should be damned. Even the 
 New York Tribune, a monopolists' own, says of one of the 
 safety-fund schemes: 
 
 "The bankers are to have free issue; and when one fails 
 the government is to collect from the other banks and redeem 
 its currency. But in time of panic the government would not 
 and could not do that." 
 
 On the other hand, the New York Sun, edited by a 
 man who was a radical socialist in his youth, and now a bitter, 
 hardened, cruel cynic, although lately a greenback paper, is 
 as rabid as the New York Evening Post in advocacy of gold 
 and gold only. It says of the latest safety-fund humbug: 
 
 "The new bill, like the old one, authorizes an inflation of 
 our paper currency, by at least 550,000,000, without providing 
 for its redemption in gold, and without any effectual provision 
 for diminishing the volume of outstanding legal tender. Our 
 New York financial magnates, who have put up, this year, 
 8116,000,000 in gold, to save the treasury from suspending 
 gold payments, ought to bestir themselves in opposition to 
 this latest administration folly, if they would not see all their 
 efforts go for naught and the catastrophe which they have 
 labored to avert rendered inevitable." [! !] 
 
 In Chicago we have Lyman Gage's plan. Mr. Gage is a
 
 American Financial History. 203 
 
 man of intellect who resembles some of those orthodox clergy- 
 men who, by a long course of theological dissipation, i. e., 
 reasoning from false premises, have impaired their naturally 
 fine faculties. Mr. Gage, if we must credit him with sincer- 
 ity, has come to the same condition by financial dissipation. 
 But his plan is not as vicious as some. To furnish the needed 
 foundation for national bank circulation, he would have the 
 treasury issue $250,000,000 of 2^ per cent, bonds, for which 
 greenbacks or Sherman notes should be paid. The money 
 paid would not become an asset of the government. It would 
 be canceled, destroyed, burned up. Uf his scheme the Chi- 
 cago Times well says: 
 
 "Like other bankers, he thinks the chief end to be sought 
 is to relieve the government of the duty of issuing the circulat- 
 ing medium of the country. Upon this point we must note 
 an emphatic disagreement with Mr. Gage, and with the whole 
 school of financiers of which he is a type." 
 
 A specimen of the demoralization and danger of the titne a 
 is seen in a recent statement of Senator Gorman, that he and 
 Quay had settled in their minds that a certain government 
 bond scheme, like that of Gage, in eight items, including some 
 about silver, was about the only proposition that could pass 
 the present Congress. No. 3 among the eight items coolly dis- 
 misses the Greenback thus: "The legal tenders to be retired 
 and canceled as the bonds are put out." 
 
 On the other hand, the Chicago Inter Ocean, which is re- 
 penting of some of its financial sins, and remembering what a 
 good greenback paper it was in 1878, says: - 
 
 "One of the perils of the present financial situation ia 
 the disposition shown to reopen the greenback question. It 
 took fifteen years to fight the great battle. Secretary McCul- 
 loch attempted to take snap judgment against legal-tender 
 notes, paying them off at a rapid rate. Illinois, through one of 
 its Congressmen, E. C. Ingersoll, stepped in the very first day 
 Congress convened after that paying-off process had begun 
 with a resolution which stopped it. Then began the intriguing 
 of the Eastern bankers to destroy the greenbacks, and when 
 the last decisive conflict occurred Illinois was again in the 
 leadership, G. L. Fort being the especial champion of the 
 greenback cause as asainst both the contraction ists and the 
 expansionists. There was a great victory. For half a gener-
 
 204 American Financial History. 
 
 ation the anti-greenbackers have been quiescent . They have 
 come to the front again with this session of Congress. The 
 knock-out received in caucus Monday ought to satisfy them 
 that the greenback is here to stay. There never could be a 
 better money. It is good for its face the world over. In that 
 uttermost end of the earth, China or Japan, the United States 
 legal tender note is good for its face value, and whatever 
 changes are made, that part of our currency should remain in- 
 tact. Should the current of Congressional events occasion a 
 show of hands in the Republican party on this question no 
 doubt an overwhelming majority would say, as did the Demo- 
 cratic caucus, let the greenbacks alone." 
 
 An extraordinary scene in the House between Representa- 
 tives Hepburn and Hendrix so fairly illustrates the muddled 
 stupidity and impudence of the gold-bugs that it deserves 
 notice here as a sign of the situation. Mr. Hepburn described 
 Mr. Hendrix as a self heralded national banker who came here 
 with oracular utterances to tell the house what to do. Mr. 
 Hepburn said his self-laudation was impaired by the recollect 
 tion of his speech sixteen months ago, when the same con- 
 ditions existed. Mr. Hendrix then found the panacea for all 
 financial ills in the repeal of the Sherman silver law. 
 
 Before describing this discussion, attention should be 
 called to the fact that the panic of 1893 was immediately 
 brought on by the bankers because Secretary Carlisle under- 
 t'ook to perform about the only good deed he has ventured 
 upon as Secretary, i. e., to pay the Sherman treasury notes 
 according to the letter of the act of July 14, 1890, in silver, 
 just as France would have done. Now mark how Hendrix 
 "opened his mouth and put his foot in it" and how finely Hep- 
 burn tripped him. 
 
 Mr. Hendrix described at some length the process by 
 which the gold was withdrawn by speculators for shipment 
 abroad, and then proceeded to contrast this with the situation 
 in France, where the Bank of Prance refused to pay, except 
 where actually necessary, more than five per cent, of gold on 
 its demand obligations. These aggressions on our gold reserve 
 must be stopped, and if the pending bill would stop them, 
 afford relief, take the government out of the banking business,
 
 American Financial History. 205 
 
 as it has been taken out of the silver business, he would vote 
 for it. 
 
 "Does the action of the Bank of France, in refusing to pay 
 more than five per cent, in gold," asked Mr. Hepburn, "impair 
 the credit of that bank ?" 
 
 "No." 
 
 "Then would the credit of the United States be impaired 
 if the United States should exercise its discretion, and redeem 
 the Sherman notes in silver ?" 
 
 "Yes, I believe it would, at this time," replied Mr. Hendrix. 
 
 "Why ?" 
 
 "Because of the general distrust of the government's 
 ability to pay in gold. One hundred and fifty-nine million dol- 
 lars of Sherman gold promises [?] to pay cannot be met with- 
 out gold." 
 
 "But the notes are redeemable in coin, not in gold," was 
 Mr. Hepburn's parting shot. 
 
 Mr. Hepburn declared that Mr. Hendrix had pointed out 
 unwittingly the remedy for the present evil when he told the 
 House that the great banking houses of Europe exercised their 
 discretion about depleting their gold vaults. "Why will not 
 the Secretary of the Treasury exercise the same discretion ?" 
 he asked, amid a round of applause. " The exercise of this 
 discretion did not impair the credit of European banks. Who 
 dared to say that the credit of this country, with 65,000,000 
 people behind it, and an unlimited taxing power, would be im- 
 paired because it refused to kneel at the demands of the 
 Shylocks?" 
 
 "Why have not the Republican Secretaries of the Treasury 
 exercised that discretion?'' asked Mr. Pence, of Colorado. 
 
 "I have not been Secretary of the Treasury," replied Mr. 
 Hepburn hotly. "When I am I will answer. I am as fully 
 convinced, however, as I am that I am alive, that if the Secre- 
 tary of the Treasury were now to exercise his discretion and 
 pay gold when legitimate redemptions were asked, and refuse 
 it to sharks and speculators, the evils from which we suffer 
 would cease to be." 
 
 A broader view is that the prime motive of the Secretary
 
 206 American Financial History. 
 
 in exercising his discretion should be the welfare of the gov- 
 ernment; and gold should be refused where its payment is 
 likely to hurt the treasury. 
 
 In the foregoing pages we have attempted to give such a 
 bird's-eye view of American money and finance as would serve 
 as an example and warning for the future. We behold in this 
 short story how our finances were continually run upon the 
 rocks and shoals of a false "political economy," so-called, and 
 how they were occasionally pulled off though remaining most 
 of the time stuck fast in the most dismal way. 
 
 We Populists claim to have a new and true American sys- 
 tem of finance, vastly better than anything possessed in Europe, 
 not omitting prosperous and wise France. We sternly demand 
 that the financial quacks and quacksalvers, now making day 
 and night hideous at Washington, step down and out, and let 
 the People's Party pull the country out of the Serbonian bog 
 into which they have plunged it. 
 
 No BA.DIANT pearl which crested fortune wears, 
 No gems that twinkling hang from beauty's ears, 
 Nor the bright stars which night's blue arch adorn, 
 Nor rising sun that gilds the eternal morn, 
 Shine with such lustre as the tear that breaks, 
 For others' woe, down Virtue's manly cheek." 
 
 ' THE man of law 
 
 Cunningly could he quibble out a flaw, 
 And scratch men's scabs to ulcera." 
 
 "GEE AT parties represent in their beginnings great prin- 
 ciples; in their old age, great prejudices." Ignatius Donnelly. 
 
 " THEBE is in human affairs one order which is the best. 
 That order is not always the one which exists; but it is the 
 order which should exist for the greatest good of humanity. 
 God knows it, and wills it; man's duty is to discover and 
 establish it." Emilt da Lavekye.
 
 ft "Hugh McCulloch hamstrung the whole nation. His man- 
 agement of the finances, while it enriched him and made him 
 a great London banker, has cost the American people more 
 than the war did:' WILLIAM D. KELLEY. 
 
 THE EIGHT MONEY CONSPIRACIES. 
 
 1. The Exception Clause. Feb. 25, 1862. In 1861 and 1862 
 demand treasury notes to the amount of $60,000,000 were issued 
 by the government and made legal-tender money for all debts, 
 public and private equal to coin. Wall Street could not 
 gamble in legal-tender paper money; so, as soon as the legal 
 tender act passed the House and was sent to the Senate, the 
 Shylocks placed on the greenback what is known as the "excep- 
 tion clause" "Except duties on imports and interest on the 
 public debt." This practically demonetized the U. S. treasury 
 note, and cost the producing classes millions of dollars. The 
 greenback "went down," or, more correctly speaking, gold 
 "went up," until II in paper money was valued at only 37 cents 
 when compared with gold. John Sherman said: ''We pur- 
 posely depreciated the greenback, to get sale for our bonds." 
 He was willing to destroy the people's money to appease the 
 greed of gold gamblers at home and abroad. 
 
 2. The National Bank Act. Feb. 25, 1863. This scheme 
 was introduced in the Senate and advocated by John Sher- 
 man in the interest of bondholders and capitalists, just one 
 year after legal-tender notes were authorized by law, and before 
 sufficient time had been given to test their utility. The express 
 object was to have the bank notes supersede the legal tender 
 notes, after the investment of legal tenders in bonds. 
 
 "I look upon the national bank, as now recognized by law," 
 says Myers in his "Money, its History and Functions," "as one 
 of the most gigantic schemes for robbing the people ever de 
 vised by man. I cannot conceive of a single reason for perpet- 
 uating the system one day beyond the time required to settle 
 its affairs. The national banks of this country have cost the 
 people, in thirty years of their existence, over $6,000,000,000. 
 
 207
 
 208 The Eight Money Conspiracies. 
 
 The credit which the banker sells at from 7 to 15 per cent, 
 costs him only 1 per cent, on actual circulation; hence it is vir- 
 tually a present to him. He draws interest on this credit; on 
 what he himself owes. His note is not money, nor is it in any 
 sense a legal tender between man and man. It is simply a 
 'promise to pay.' The banker lends his credit, with which he 
 has supplied himseif by gift from the government, and the bor- 
 rower pledges his wealth; the banker being far more secure 
 than the holder of the banker's paper. The banker takes pay 
 for something he does not furnish; for the capital (wealth) is 
 furnished by the borrower. So the banker gets something for 
 nothing, and the borrower pays for that which he never 
 -Deceives." 
 
 Banks are run on the deposits, rather than on any capital 
 the banker himself may have. The patrons of the bank furnish 
 the capital, and also the security. The banker lends other peo- 
 ple's money to other people; on this he draws interest; he 
 conducts his business on your money and his credit, which you 
 furnish him. 
 
 Now, if the government can afford to let the banker have 
 credit at 1 per cent, on actual circulation, why can't the treas- 
 ury supply all the people with legal-tender money at the same 
 rate? Why not issue the money direct to the people and then 
 pay interest into the U. S. treasury, instead of into the coffers 
 of corporate institutions? National banks are expensive lux- 
 uries which we don't need. So let the people unite in demand- 
 ing their abolition at once, and then institute in their stead 
 United States banks, sub-treasuries if you please, backed by 
 all the people, and hence absolutely safe. This would make a 
 government for the people instead of for the corporations. Let 
 us do business on the credit of the people on the credit of the 
 government; not, as we are now doing, on the credit of banks 
 and bankers. 
 
 3. The Funding Act. April 12, 1866. Commonly called 
 contraction. This law authorizes the Secretary of the Treasury 
 to retire the legal-tender notes by investing them in 6 per 
 cent, bonds. Contraction continued until some $1,500,000,000 
 were destroyed, and a corresponding amount of 6 per cent.
 
 The Eight Money Conspiracies. 209 
 
 bonds issued. The treasury notes, or legal tenders, were 
 nearly all non-interest-bearing. This reduction of the cur- 
 rency was an outrage upon the people. The volume should 
 have been increased, not diminished, to have kept pace with 
 an increasing population. 
 
 4. The Credit Strengthening Act. March 18,1869. 
 This law provides that the legal-tender treasury notes should 
 be paid in coin, as also all interest-bearing obligations of the 
 government. Prior to the passage of this law, public obliga- 
 tions had been payable in the lawful money of the country; 
 the greenback was lawful money, redeemable the same as gold 
 and silver coin, except duties on imports and interest on the 
 public debt. The credit of the nation was good, and needed no 
 strengthening. The war was over and the country was prosperous 
 and the people contented. Why, then, add another burden? 
 
 5. An Act Refunding the Public Debt. July H, 
 1870. This act authorized the issue and sale of 81,500,000,000 
 U. 8. bonds, to refund 5-20 bonds, and make them conform to 
 the law of 1860. To fund means to put public obligations into 
 stocks and securities, making them interest-bearing. 
 
 The public debt should have been paid, as at first provided, 
 in the lawful currency of the country, gold, silver, and treas- 
 ury notes. The law of 1869 added $500,000,000 to the 5-20 
 bonds, by making them payable in coin; then to re-fund the 
 bonds, just to please an English aristocracy, is villainy unnamed 
 and unnainable. 
 
 6. The Demonetization of Silver. Feb. 12, 1873. 
 The act of 1869 had made all public obligations payable in coin, 
 gold or silver; while the act of 1873, clandestinely passed, de- 
 monetized silver, making the public debt, interest and all, 
 payable in gold coin a further contraction of the volume of 
 currency. 
 
 The silver dollar was created by the Congress of the 
 United States on April 2, 1792, and made the unit of value. It 
 contains 412)^ grains of standard silver, nine parts pure silver, 
 one part alloy. At that time the mints of all the principal 
 nations of the world were open to the free coinage of both gold
 
 210 The Eight Money Conspiracies. 
 
 and silver. That is, all of such metal presented to the mints 
 could be converted into money without any charge except the 
 actual cost of coining. The ratio then was about 15J^ to 1, 
 that is, one ounce of gold was equal to 15^ ounces of silver. 
 January 18, 1837, the ratio between gold and silver coins of the 
 United States was changed to 15.988 to 1, commonly referred 
 to as 16 to 1. 
 
 Free coinage of silver prevailed in the United States from 
 1792 until 1873, when, by an act of Congress, silver was demon- 
 etized, making all paper currsncy and government obligations 
 redeemable in gold. The act demonetizing silver was under- 
 stood by few, and, in fact, many of those who voted for it, and 
 President Grant, who signed the bill, were unaware of its actual 
 meaning and effect. As will be proven by documents and facts 
 submitted elsewhere in this volume, the money speculators of 
 England, backed by cupidity and ignorance on this side, were 
 the real instigators of the act of 1873. There was every reason 
 in the world why England should desire the demonetization of 
 silver here. England is a creditor nation, and her capitalists 
 hold vast amounts in government and other securities abroad 
 Prom this country alone the capitalists of Great Britain derive 
 each year more than five hundred millions of dollars for inter- 
 est on their investments, all of which is paid in gold or its 
 equivalent. The United States produces an enormous quan- 
 tity of silver, but we very humbly submit to the gold standard 
 as set up by Great Britain. We deny ourselves the right to 
 use a metal of which we have an abundance and adopt one 
 more scarce and, consequently, more expensive. By this policy 
 we are forced to purchas gold abroad, thus adding constantly 
 to the burden of a perpetual, interest-bearing national debt. 
 
 By accomplishing the demonetization of silver in this coun- 
 try, England gained a double victory, for the governments of the 
 Latin Union, France, Belgium, Italy, Switzerland and Greece, 
 were soon afterwards forced to suspend silver coinage. The 
 gain to England and the loss to the other countries involved, 
 especially to the United States, by this general demonetization 
 of silver, can hardly be estimated. The loss, of course, was the 
 heaviest in this country, where the production of silver is very
 
 The Eight Money Conspiracies, 211 
 
 large, where BO many are engaged in agricultural pursuits, and 
 where a large and freely circulating volume of money is BO es- 
 sential to. commercial activity. 
 
 When silver was demonetized, we were under the burden 
 of an enormous national debt, but every dollar of this was pay- 
 able in silver. The stimulated demand for gold, and, conse- 
 quently, its increase in value, was not the only gain to England. 
 She now buys our cheap silver bullion, exchanges it at its coin- 
 age value for products in the silver-using countries of Asia, Af- 
 rica and South America, and nets a profit of over one hundred 
 per cent, by the transaction. We then buy from her at 
 gold prices and pay with gold or products at prices which, by 
 forcing us into competitien with the world, England fixes her- 
 self. 
 
 Thus it can be seen that our neighbors in Canada are not 
 any more subject to British rule than our proud republic 
 and all because we have discarded our own metal, silver, and 
 submitted humbly to the golden calf of England. 
 
 7. The Resumption of Specie Payment. Janu- 
 ary 14, 1875. This law provided for the retirement of the frac- 
 tional currency (45 millions) and the legal-tender treasury 
 notes; their place to be supplied by national bank notes, which 
 are not a legal-tender between man and man. The name 
 "specie payment" is simply a blind; it does not mean anything; 
 to get rid of the much despised greenback was the real object 
 of the act. The moneyed aristocracy had long ago confessed 
 their inability to "control" the "greenback as it is called. " Had 
 the provisions of this law been carried out, it would have add- 
 ed to our annual interest charge about twenty millions of 
 dollars. 
 
 8. The Sherman Purchasing Clause. July 14^ 
 1890. This act was a miserable makeshift or substitute for a 
 free coinage bill. It provided for the purchase of not less than 
 2,000,000 nor more than 4,500,000 ounces of silver bullion per 
 month, 2,000,000 ounces of which was to be coined each month 
 into silver dollars until July 1, 1891. Instead of redeeming 
 the treasury notes issued in the purchase of silver with their 
 equivalent in silver, upon the demand of the holder, the Secre-
 
 212 The Eight Money Conspiracies. 
 
 tary of the Treasury was required to redeem these notes in gold 
 or silver coin at his discretion. The legal-tender power of the 
 silver dollar was modified so as to read: "except otherwise ex- 
 pressly stipulated in the contract." In 1893 President Cleveland 
 called Congress together in extraordinary session to consider 
 the financial condition of the country. November 1, 1893, the 
 Sherman law was repealed, leaving us on a single gold basis. 
 
 Modern Reformers. 
 
 The world has had reformers, men who were sternly just, 
 Who smote the thrones of wickedness and laid them in the 
 
 dust; 
 Meek, tender men, made mighty by mankind's blood and 
 
 tears, 
 Strong 1 men whose words were thunderbolts to smite the 
 
 wrong of years. 
 
 Were all these stern reformers of a breed too weak to last? 
 Did all the great wrong-smiters wane and perish in the past? 
 Did they fight a losing battle? Were they conquered in the 
 
 fray? 
 
 Why are there no reformers fighting in the world today? 
 Well, 'tis but a thing of labels; the reformers have not gone, 
 But they're mixing with the people with misleading placards 
 
 on; 
 For we placard them "fanatics,"' "visionaries," "cranks," 
 
 and " fools," 
 Men denounced by clubs and churches, by the journals and 
 
 the schools. 
 There are men who wear these placards daily in the market 
 
 place, 
 
 Heroes of the ancient lineage, kings and saviors of the race; 
 And we do not see their greatness through life's trivial 
 
 events, 
 But our children's sons will read it on their granite monu- 
 
 ments. Sam Walter Fots. 
 
 ' ' AND our flag was newly woven, every stripe and every star, 
 With the cannon balls for shuttles, in the roaring loom of 
 
 war; 
 And our gallant weavers dyed it with their manhood in each 
 
 hue 
 Red for courage, white for honor, and for faithfulness the 
 
 bine." Howard 8. Taylor,
 
 * " When I stand in the United States Treasury I stand on 
 English >//." NATHANIEL P. BANKS. 
 
 THE DOCUMENTARY EVIDENCE. 
 
 THAT the pernicious financial legislation of the United 
 States was not due merely to ignorance, but was the result 
 of a most damnable conspiracy, aided by venality and corrup- 
 tion, is proven by the documents which follow. The reader is 
 asked to read them carefully. Trace the winding trail of the 
 serpent and behold its glittering golden head. 
 
 First comes the famous Hazzard circular. This was issued 
 by an agent of the London capitalists to New York capitalists 
 in 1862. It was first given to the general public on Sept.] 18, 
 1886, by the Council Grove (Kas.) Guard, being reprinted from 
 a copy taken from the letter files of the First National Bank 
 of Council Grove: 
 
 The Hazzard Circular. 
 
 Slavery is likely to be abolished by the war power, and 
 chattel slavery destroyed. This I and my European friends 
 are in favor of, for slavery is but the owning of labor and car- 
 ries with it the care of the laborer, while the European plan, 
 led on by England, is capital control of labor by controlling 
 wages. THIS CAN BE DONE BY CONTROLLING THE 
 MONEY. The great debt that capitalists will see to it is made 
 out of the war must be used as a measure to control the vol- 
 ume of money; to accomplish this the bonds must be used as a 
 banking basis. We are now waiting to get the Secretary of the 
 Treasury to make this recommendation to Congress. It will not 
 do to allow the "greenback," as it is called, to circulate as 
 money any length of time, for we cannot control them, but w 
 can control the bonds, and through them the bank issue. 
 
 CHAS. HAZZARD. 
 
 HAZZARD WAS HEBE. 
 STATE OP INDIANA, ) 
 County of Posey, $ se 
 
 James G. Nisbett, being duly sworn deposes and says: I 
 am seventy-three years of age and live in Posey County, Indi- 
 ana, where I have resided for sixty-five years. In 1861 I and 
 Sheridan Anderson, who is now dead, of the same county, en- 
 listed in the service of the United States Army, Sixtieth Regi- 
 
 213
 
 214 The Documentary Evidence. 
 
 ment and Company C of the Indiana Infantry. In July, 1862, 
 our command joined the forces of General Dumont at Lebanon, 
 Ky. About the twenty -fifth of the same month Mr. Anderson 
 and myself were detailed as guards and placed on police duty 
 on Main Street. In passing near the General's headquarters we 
 were hailed and ordered to "shadow" a party of three persons- 
 one woman andtwo men-who were then passing on the opposite 
 side of the street, find out their business and report. We 
 learned that one man and the woman were Kentuckiann and 
 the other man was an Englishman. We had considerable con- 
 versation with the Englishman who gave his name as Chas. 
 Hazzard. He said he had recently come from England to con- 
 fer with the business men of this country in a financial scheme. 
 We told him that he was lucky in striking a very large body of 
 very busy men, and as representatives of headquarters we desired 
 tangible information of his business that we might report it to 
 the authorities. In response to this he took one of a small 
 package of envelopes and gave it to Mr. Anderson, saying its 
 contents would explain the business and allay any suspicions 
 that might have arisen regarding him. This occurred in the 
 post office, and we then reported the matter to General Du- 
 mont at headquarters, giving him the circular in the presence 
 uf several officers who happened to be present at the time. An 
 exact copy of that document was kept by us, and the following 
 is a correct reading of the same. 
 
 [Here follows the circular printed above.] 
 
 JAMES G. NISBETT. 
 
 Subscribed and sworn to before me this 29th day of May, 
 1894. JOHN B. SMITH, 
 
 (SEAL) Notary Public. 
 
 Bribing the Law-Makers. 
 
 The following shows how the crime of 1873 was paid for 
 by British gold: 
 STATE OP COLORADO, ) 
 County of Arapaboe. > 
 
 Frederick A. Luckenbach, being first sworn, on oath de- 
 poses and says: "I am sixty-two years of age. I was born in 
 Bucks County, Pennsylvania. I removed to the city of Phila- 
 delphia in the year of 1846, and continued to reside there until 
 1866, when I removed to the city of New York. In Philadel- 
 phia I was in the furniture business. In New York I branched 
 into machinery and inventions, and am the patentee of Luck- 
 enbach's pneumatic pulverizer, which machines are now in use 
 generally in the eastern part of the United States and Europe. 
 I now reside in Denver, having removed from New York two
 
 The Documentary Evidence. 215 
 
 rears ago. I am well known in New York. I have been a mem- 
 ber of the Produce Exchange and am well acquainted with 
 many members of that body. I am well known by Mr. Erastus 
 Wiman. In the year of 18G5 I visited London, England, for 
 the purpose of placing there Pennsylvania oil properties in 
 which I was interested. I took with me letters of introduction 
 to many gentlemen in London, among them one to Mr. Ernest 
 Seyd, from Robert M. Foust, ex-Treasurer of Philadelphia. I 
 became well acquainted with Mr. Seyd and also with bis 
 brother, Richard Seyd, who, I understand, is yet living. I vis- 
 ited London thereafter every year, and at each visit renewed 
 my acquaintance with Mr. Seyd and upon each occasion be- 
 came his guest one or more times, joining his family at dinner 
 or other meals. In February, 1874, while on one of these visits 
 and while his guest at dinner, I, among other things, alluded 
 to rumors afloat of Parliamentary corruption and expressed as- 
 tonishment that such corruption should exist. In reply to this, 
 he told me he could relate facts about corruption of the Ameri- 
 can Congress that would place it far ahead of the English Par- 
 liament in that line. 
 
 So far the conversation was at the dinner table between 
 us. His brother Richard and others were there also, but this 
 was table talk between Mr. Ernest Seyd and myself. After the 
 dinner had ended he invited me to another room, where he re- 
 sumed the conversation about legislative corruption. He 
 said: "If you will pledge me your honor as a gentleman not to 
 divulge what I am about to toll you while I live. 1 will convince 
 you that what I said about the American Congress is true." I 
 gave him my promise, and he then continued: "I went to 
 America in the winter of 1872-3, authorized to secure, if I could, 
 the passage of a bill demonetizing silver. It was to the inter- 
 ests of those whom I represent the Governors of the Bank of 
 England to have it done. I took with me 100.000 with in- 
 structions, if that was not sufficient to accomplish the object, 
 to draw for another 100,000 or as much more as was neces- 
 sary." He told me German bankers were also interested in 
 having it accomplished. He said he was the financial adviser 
 of the bank. He said: "I saw the committees of the House 
 and Senate and paid the money and staid in America until I 
 knew the measure was safe." 
 
 I asked if he would give the names of the members to 
 whom he paid the money, but this he declined to do. He said: 
 "Your people will not now comprehend the far-reaching extent 
 of that measure, but they will in after years. Whatever you 
 may think of corruption in the English Parliament, I assure 
 you I would not have dared to make such an attempt here as I 
 did in your country." 
 
 I expressed my shame to him for my countrymen in our
 
 216 The Documentary Evidence. 
 
 legislative bodies. The conversation drifted into other sub- 
 jects, and after that, though I met him many times, the matter 
 was never again referred to. 
 
 FREDERICK LUCKEWBACH. 
 
 Subscribed and sworn to before me at Denver, Colo., this 
 6th day of May, A. D. 1892. 
 
 (Signed) JAMES A. MILLER, 
 
 Clerk Supreme Court, State of Colorado. 
 
 Bribing the Press. 
 
 The following is taken from the Chicago Inter Ocean of 
 October 29, 1877, and reproduced exactly as found in the bound 
 flies of that newspaper: 
 
 The Inter Ocean acknowledges the receipt of the following 
 singular document, which came to this office from New York. 
 Saturday morning: 
 
 "AMERICAN BANKERS' ASSOCIATION, ) 
 247 Broadway, Room 4, [ 
 NEW YORK, Oct. 0, 1877. ) 
 "Strictly Private. 
 
 " DEAR SIR: Please insert the enclosed printed slip as 
 leaded matter on the editorial page of your first issue imme- 
 diately following the receipt of this, and send marked copy 
 with the bill to Yours truly, JAS. BUEL, Sec'y, 
 
 "Comments on the slip, not to exceed half a column, will 
 be paid for if billed at the same time. J. B." 
 
 The following is the document, which we are asked to in- 
 sert as leaded matter on the editorial page, in other words, as 
 a statement made by the Inter Ocean: 
 
 "The Greenback party has offered through its managers to 
 sell out to the Democrats and hereafter to work in Democratic 
 harness if a few of their leaders can be provided for. This 
 shows how much dependence there is to be placed on the 
 leaders of the lunatics who clamor for money based on nothing." 
 
 We insert this, but we shall send no bill for it. We shall 
 send no bill because, in the first place, we do not follow direc- 
 tions about leading it; secondly, we can't believe a word of the 
 statement to be true. We do not know who is managing the 
 affairs of the American Bankers' Association, but, whoever he 
 is, we advise that body to get rid of him without delay. The 
 attempt to thus maliciously destroy the Green back party with- 
 out submitting a word of proof is a piece of aff rontery which 
 ought to be beneath any body of commercial gentlemen, and 
 especially the American Bankers' Association. We refuse to 
 believe that such an extraordinary document was authorized 
 by that body.
 
 The Documentary Evidence. 217 
 
 Since the above was put in type we have received a copy 
 of the New York Sim containing the above circular, which it 
 appears was sent that paper also. The Sun publishes the 
 document with editorial comment, from which we quote as fol- 
 lows: 
 
 " This, we say, is an extraordinary circular, with an extra- 
 ordinary slip. It will be seen that the slip is or assumes to be, 
 an item of news. It is an item that none of the ubiquitous re- 
 porters of the Sun had been able to get held of. If any one of 
 them had brought it to us properly authenticated by docu- 
 mentary or other evidence, we would not have asked him to 
 pay us for printing it, but, on the contrary, we would have paid 
 him well for procuring it. It will be observed, however, that 
 the scandalous item which we are asked in the name of the 
 American Bankers' Association to publish, has two peculiar- 
 ities: First, no proof of its accuracy is furnished; and secondly, 
 we are offered money for its publication as leaded matter on 
 the editorial page of this day's Sun. This is remarkable busi- 
 ness to be performed in the name of the American Bankers' 
 Association. 
 
 "Our astonishment is increased by the postcript which ap- 
 pears at the bottom of this circular. It informs us that com- 
 ments upon the slip, not to exceed half a column, will be paid 
 for. This means, of course, that the editorial comments that 
 are to be paid for must sustain the slip on the editorial page 
 that is to be paid for. . . . But is this attempt to bribe and 
 corrupt the press, by the direct offer of money for editorial 
 articles made under the authority of the American Bankers' 
 Association, the name of the secretary of which is signed to 
 the circular above printed? We call for information upon thiB 
 point, and shall wait for it. If authority has been given to 
 bribe the press, then very certainly attempts will be made to 
 bribe Congress and corrupt the sources of influence at Wash- 
 ington in the same interest. It is a shameful business, if there 
 be not some mistake about it. Let the truth be brought out. 
 Let a responsibility for this circular be fixed. If this circular 
 s a forgery we shall be glad to make it known." 
 
 Following is the printed slip offered for the Sun to print; 
 
 " The prospect is that in six months there will not be a 
 Greenback leader in all the land. Overtures have been made 
 by the leaders of the Greenback movement to President Hayes 
 to abandon the greenback as a lost cause, provided he will 
 give good official positions to about twenty of the most blatant 
 of those clamorous for money that is based on nothing."
 
 218 The Documentary Evidence, 
 
 The Banks' Circular. 
 
 The following circular was sent out in 1878 by the bankers 
 of New York to the national banks: 
 
 NEW YORK, Oct. 9, 1878. 
 
 DEAR SIR: It is advisable to do all in your power to sus- 
 tain such prominent daily and weekly newspapers, especially 
 the agricultural and religious press, as will oppose the issuing 
 of greenback paper money, and that you also withhold patron- 
 age or favors from all applicants who are not willing to oppose 
 the government issue of money. Let the government issue the 
 coin and the banks issue the paper money of the country, for 
 then we can better protect each other. To repeal the law 
 creating national bank notes, or to restore to circulation the 
 government issue of money, will be to provide the people with 
 money, and will therefore seriously affect your individual profit 
 as bankers and lenders. See your Congressman at once, and 
 engage him to support our interests that we may control legis- 
 lation. JAMES BUEL, 
 
 Secretary, 247 Broadway. 
 
 The Extra Session Letter. 
 
 The following is reprinted from an original copy of the 
 letter in possession of Mr. George C. Ward: 
 
 THE AMERICAN BANKERS' ASSOCIATION. ) 
 
 No. 2 WALL ST. AND 90-94 BROADWAY, ROOM No. 44. t 
 NEW YORK, August 19, 1893. ) 
 To the Bankers of the United States. 
 
 Gentlemen: The extraordinary monetary crisis through 
 which the United States are passing, which involves the banks 
 of the country to an extent that compels their officers to re- 
 main constantly at the post of duty while the danger is immi- 
 nent, has constrained the American Bankers' Association to 
 indefinitely postpone its annual convention called for the 6th 
 and 7th prox., at Chicago. This will prevent such expres ion 
 upon the part of the association as the financial situation de- 
 mands, which otherwise would be made. It thus becomes the 
 duty of the officers of the Association to speak for it at this 
 time, and suggest what seems to them to be the proper action 
 for the bankers of the country to immediately take with a view 
 to obtaining speedy relief from the continued and disastrous 
 stringency. 
 
 It is manifest that the immediate cause of r the prolonged 
 stringency is the fear and appreciation of disaster engendered 
 in the minds of the people by the continued purchases of silver
 
 The Documentary Evidence. 219 
 
 by the government, and by the unceasing issues of its obliga- 
 tions therefor, redeemable in gold, which fear and apprehension 
 can only be removed and confidence restored by the removal of 
 the cause.. It is believed that the bankers of the country will 
 understand and realize this to as great, if not to a greater, extent 
 than any other class of citizens, and it therefore becomes the 
 duty of such of them as fully realize this to urge upon their 
 fellow- citizens and upon Congress the great necessity for the 
 immediate and unconditional repeal of the purchasing clause 
 of the Sherman silver act. 
 
 The repeal of this clause is demanded in the interpst of 
 those favoring a gold standard, and of those favoring the use of 
 silver with gold, as the continued purchase of enormous quan- 
 tities of silver with gold obligations can only result in the final 
 inability of the government, to redeem such obligations in gold, 
 and in the continued over-production and consequent further 
 depreciation of silver, thus rendering the prospect of any inter- 
 national agreement for its more general use throughout the 
 world more hopeless than at present. 
 
 The President of the United States having convened Con- 
 gress in extra session and recommended to it such repeal, the 
 power of public opinion should be brought to bear upon Con- 
 gress, to induce favorable action thereon. This may best be 
 done by invoking the aid of the press, and by citizens writing 
 to their Senators and Representatives, and by sending to them 
 petitions urging such repeal; all of which should be done to the 
 fullest extent possible, and without delay. 
 
 A blank form of petition is enclosed, to be circulated 
 among merchants, business men and others for their signatures, 
 to which additional sheets may be appended. Act at once in 
 the matter and secure the intelligent co-operation of others, 
 providing them with printed or typewritten copies of the peti- 
 tion for the purpose. Respectfully, 
 
 WILLIAM H. RHAWN. President. 
 
 E. H. PULLEN. Chairman Executive Council. 
 
 H. W. FORD, Secretary. 
 
 "TAXES ought, of course, to be paid; but there are many 
 ways of collecting taxes without robbing a man of his home, 
 for a few dollars. The home should be sacred. Strictly it 
 should pay no taxes. It is the spot of land on which God 
 places a family. It should be walled in against the selfish- 
 ness and cruelty of mankind; and the very lightnings of 
 heaven should play around it to defend it; even as the fiery 
 sword, turning every way, guarded the gate of Paradise." 
 Ignatius Donnelly.
 
 & " The time has come ivhen the railroad corporations will 
 either own the people, or the people must own the railroads. 
 * * * The Government should own and operate the railroads 
 in the interest of the people." Omaha Platform. 
 
 THE TRANSPORTATION PROBLEM. 
 
 ^ 
 
 ATKINSON estimates that into the cost of every article 
 enters an average of eight per cent, for transportation- 
 This alone would make the railroad problem a most important 
 one. But many other considerations combine to add to the 
 momentum with which the subject is forcing itself upon the 
 attention of the American people. The abuses which have 
 crept into railroad management in this country, long tolerated 
 by the people and unchecked and even encouraged by public 
 officers, have now assumed such proportions as to threaten the 
 very foundation of free government. 
 
 In his famous work, "The Railroad Question," which every 
 American voter who wishes to be well informed should read 
 Hon. William Larrabee, the great railroad Governor of Iowa, 
 says: 
 
 "Great discoveries that add rapidly to the wealth of a 
 country tend to overthrow a settled condition of things, and 
 organized capital and labor, if not restrained by wholesome 
 laws and public watchfulness, will ever take advantage of the 
 unorganized masses. The people of those regions which the 
 railroad stimulus had caused to be settled thrived for years so 
 well upon a virgin soil that they gladly divided their surplus 
 with the railroad companies. They looked upon the railroads 
 as the source of their prosperity and upon railroad managers 
 as high-minded philanthropists and public benefactors, with 
 whom to quarrel would be an act of sordid ingratitude, and 
 they paid but little attention to the means employed by them 
 to exact an undue share of their earnings. Railroad men did 
 whatever they could to foster through their emissaries this 
 misplaced adoration. They posed before the public as the 
 rightful heirs of the laurels of Watt and Stephenson, insisting 
 that their genius, capital and enterprise had built up vast cities 
 and opened for settlement and civilization the boundless prai- 
 ries of the West. These claims have been persistently re- 
 peated by railroad men, though they are so preposterous that 
 
 220
 
 The Transportation Problem. 381 
 
 they scarcely deserve refutation. The railroad, gradually de- 
 veloped by active minds of the past, and greatly improved by 
 the inventions of hundreds of men in the humbler walks of 
 life, is the common inheritance of all mankind, though no 
 class of people have derived greater benefits from it than rail- 
 road constructors, managers and manipulators. Railroad man- 
 agers are no more entitled to the special gratitude of the pub- 
 lic for dispensing railroad transportation at much more than 
 remunerative rates than is the Western Union monopoly for 
 maintaining among us an expensive and inefficient telegraph ser- 
 vice. No one believes that the disbanding of the Western Union 
 would leave us long without telegraphic communication. In 
 like manner railroads will be built whenever and wherever they 
 promise to be profitable. If one company does not take advan- 
 tage of the opportunities offered, another will. That large 
 cities have been built up by the railroads is true, but it is 
 equally true that these cities by their commerce and manufac- 
 tures administer to the prosperity of the railroads as much as 
 the railroads administer to theirs. Commercial centers in days 
 gone by existed without railroads, but railroads could not long 
 exist without the stimulating influence of these busy marts of 
 trade. The same argument applies with still greater force to 
 the agricultural sections of our country, especially the great 
 Northwest. Th dry -goods merchant might as well boast of 
 having clad the public as the railroad manager of having built 
 up farming communities by selling to them transportation. 
 
 " And yet the American people have never ceased to be 
 mindful of the conveniences afforded to them by this modern 
 mode of transportation. On the contrary, they have been but 
 too prone to credit railroad men with being benefactors, when 
 they were but beneficiaries, and this liberality of spirit made 
 them overlook, or at least tolerate, the abuses which grew pro- 
 portionately with the wealth and power of the companies. 
 
 "The first railroad acts of England had contemplated to 
 make the roads highways, like turnpikes and canals. These 
 roads were established by the power of eminent domain. Com- 
 panies were empowered to build and maintain them and to re- 
 imburse themselves by the collection of fixed tolls. Had the 
 owners of the roads from the beginning been deprived of the 
 privilege of becoming carriers over their own lines, the system 
 might have so adjusted itself as to become entirely practicable; 
 but as they were allowed to compete with other carriers in the 
 transportation of passengers and merchandise, they were soon 
 able to demonstrate, at least to the satisfaction of Parliament, 
 that the use of the track by different carriers was impracticable 
 and unsafe. A number of circumstances combined to aid the 
 railroads in their efforts to monopolize the trade on their lines.
 
 222 The Transportation Problem. 
 
 In the first place, when the early railroad charters were granted, 
 but few persons had any conception of the enormous growth 
 of commerce which was destined to follow everywhere the in- 
 troduction of railways. The tolls as fixed in the charter soon 
 yielded an income out of proportion to the cost of the cdnstruc- 
 tion and maintenance of the roads. Their large margin of profit 
 enabled the owners of the roads to transport goods at lower 
 rates than other carriers and to thus compel the latter to aban- 
 don their business. Another defect of the original charters 
 worked greatly to the disadvantage of independent carriers. 
 They contained no provision as to the use of terminal facilities. 
 The railroad companies claimed that these facilities were not 
 affected by the public franchise and were therefore their per- 
 sonal property. This placed independent carriers at a great 
 disadvantage and made in itself competition on a large scale 
 impossible. These carriers were thus at the mercy of the rail- 
 road companies for the transportation of their cars, and the 
 companies never permitted their business to become lucrative 
 enough to induce many to engage in it. It soon became ap- 
 parent that under the charters granted to the railroad com- 
 panies such competition as existed on turnpikes and canals 
 was out of the question on their roads. In England the great 
 abundance of water-ways exercised for many years a whole- 
 some control over the rates of railway companies, until these 
 companies, greatly annoyed by such restraint, absorbed many 
 of the larger canals by purchase and made them tributary to 
 their systems. These companies have also acquired complete 
 control over many harbors. 
 
 "In the United States the people depended from the be- 
 ginning of the railroad era on free competition for the regula- 
 tion of railroad charges. This desire to maintain free compe- 
 tition led to the adoption of general incorporation acts, it being 
 generally believed that such competition as obtains between 
 merchants, manufacturers and mechanics was possible among 
 railroads and would, when allowed to be operative, regulate 
 prices and prevent abuses. The remedy was applied freely 
 throughout the country, but for once it did not prove successful. 
 Stephenson's saying, that where combination was possible, com- 
 petition was impossible, was here fully verified. The great in- 
 genuity of the class of men usually engaged in railroad enter- 
 prises succeeded in thwarting this policy of commercial free- 
 dom. The opportunities for those in control of railroads to 
 operate them in their own interest regardless of the interests 
 of their patrons and stockholders were so great that men of a 
 speculative turn of mind were attracted to this business, which 
 soon proved a most productive field for them. One road after 
 another fell into the control of men who had learned rapidly 
 the methods employed to make large fortunes in a short time."
 
 The Transportation Problem. 223 
 
 On the subject of watered railroad stocks, Gov. Larrabee 
 eays: 
 
 "It is a notorious fact that the stock of a large number of 
 railroad companies represents little or no value, having either 
 been sold at a mere nominal price or been donated as a pre- 
 mium or bonus to those who purchased a large amount of the 
 company's bonds. In recommending, in his December, 1891, 
 annual mssage, government aid for the Nacaragua Canal, 
 President Harrison said: 'But if its bonds are to be marketed 
 at heavy discounts and every bond sold is to be accompanied 
 by a gift of stock, as has come to be expected by investors in 
 such enterprises, the traffic will be seriously burdened to pay 
 interest and dividends.' It is not difficult to surmise to what 
 enterprises the President referred. It has for many years been 
 a well-settled principle among railroad incorporates that no 
 larger assessments should be made upon the stockholders than 
 is necessary to float the company's bonds. A company, for in- 
 stance, is organized with a capital stock of, say, $1,000,000. 
 Five per cent, of this sum, or 850,000, is paid in to defray pre- 
 liminary expenses. The road is then bonded for perhaps $2,- 
 000,000, but as the bonds are sold for only 80 per cent, of their 
 face value and as the incorporators allow themselves five per 
 cent, for the negotiation of bonds, only $1,500,000 is realized 
 for the construction of the road. The incorporators now vote 
 to themselves a contract to construct the road for 1,500,000 
 and at once sublet it to a contractor who is ready atd anxious 
 to build the road for $1,200,000. The incorporators thus realize 
 $1,000,000 worth of stock, a portion of which is unloaded upon 
 unsophisticated investors, and $300,000 in cash, at an outlay of 
 850,000; and the road, which cost 81,200,000, is made to pay in- 
 terest and dividends on a total capital of 3.000,000, and this is 
 subsequently watered indefinitely if the road proves profitable 
 or a consolidation with some other road justifies the belief that 
 its earning capacity might be increased. Nor is this an over- 
 drawn picture. On the contrary, instances might be cited 
 where only one-half of one per cent, of the company's stock 
 was paid in by the shareholders." 
 
 Space does not permit here to go fully into the subject of 
 railroad abuses. The reader is referred to the chapter headed 
 "A New Study of Political Economy" for further information, 
 and those who wish to inform themselves fully on all phases of 
 therast subject should read carefully Gov. Larrabee's book. 
 That the system of railroad corporations as now existing has 
 been the source of the gravest evils is everywhere apparent. 
 The case of the Camden and Am boy Railroad as related by Gov.
 
 224 The Transportation Problem. 
 
 Larrabee is a startling instance of corporate corruption. There 
 never was a more flagrant case of public robbery than that of 
 the Union Pacific roads. The great Standard Oil monopoly 
 would have been impossible but for the power and tendency of 
 the railroads to kill competition. Perhaps no other factor has 
 been BO powerful in bringing about that concentration of 
 wealth which is undermining the foundations of our republic.
 
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