Federal officials, it must be admitted, did not set a high standard for local officers to follow. During Grant's administration five judges of a United States Court were driven from office by threats of impeachment; members of the Committee on Military Affairs in the House of Representatives sold their privilege of selecting young men to be educated at West Point; and candidates for even the highest offices in the gift of the nation were sometimes men whose political past would not bear the light of day. More difficult to overcome was the lack of a decent sense of propriety among many public officers. Members of the Senate practiced before the Supreme Court, the justices of which they had an important share in appointing; senators and representatives traded in the securities of railroads which were seeking favors at the hands of Congress; and even in the most critical circles, corrupt practices were condoned on the ground that all the most reputable people were more or less engaged in similar activities. Most difficult of all to understand was the unfaltering support accorded by men of the utmost integrity to party leaders whose evil character was known on all sides. Men who would not themselves be guilty of dishonest acts and who vehemently condemned such deeds among their political opponents, failed to make any energetic protest within their own ranks for fear that they might bring about a party split and thus give the "enemy" a victory.
The political practices which prevailed after 1865 for at least a quarter of a century were notoriously bad. Yet the student of the period must be sensitive to higher aspirations and better practices among many of the politicians, and among the rank and file of the people. George F. Hoar, John Sherman, Rutherford B. Hayes, Grover Cleveland and many others were incorruptible. The exposure of scandalous actions on the part of certain high officials blasted their careers, indicating that the body of the people would not condone dishonesty, and the parties found it advisable to accept the resignations of some of their more notorious campaign managers. Moreover, the American people of all classes were a political people, with a capacity for political organization and activity, and with a passion for change. The cruder forms of corruption were successfully combated, and the popular, as well as the official sense of good taste and propriety gradually reached higher levels.
Another fundamental political consideration after the Civil War was the gradual reduction of the power of the executive department. During the war the authority exercised by President Lincoln had risen to great heights, partly because of his personal characteristics and partly because the exigencies of the times demanded quick executive action. After the conflict was past, however, the legislative body naturally reasserted itself. Moreover, the quarrel between President Johnson and Congress, as has been shown, took the form of a contest for control over appointments to office and especially over appointments to the cabinet. The resulting impeachment, although it did not result in conviction, brought about a distinct shrinkage in executive prestige. Grant was so inexperienced in politics and so naive in his judgments of his associates that he fell completely into the power of the machine and failed to revive the former importance and independence of his office.
The ascendancy which thus slipped out of the hands of the executive was seized by the Senate, where it remained for a long period, despite efforts on the part of the president and the House of Representatives to prevent it. So remarkable and continuous a domination is not to be explained by a single formula. The long term of the members of the Senate, the traditional high reputation of the body and the undoubted ability of many of its members assisted in upholding its prestige. Its small size as compared with the House of Representatives gave it greater flexibility. Furthermore, certain Senate practices were instrumental in giving that body its primacy. Under the provisions of the Constitution the Senate has power to ratify or reject the nominations of the executive to many important positions within his gift, and by the close of reconstruction it had acquired a firm control over such appointments. "Senatorial courtesy" bade every member, regardless of party, to concur with the decision of the senators from any state with regard to the appointments in which they were interested. When, therefore, the executive wished to change conditions in a given office he must have the acquiescence of the senators from the state in which the change was to occur. If he did not, the entire body would rally to the support of their colleagues and refuse to confirm the objectionable nominations. With such a weapon the Senate was usually able to force the executive into submission, or at least to make reforms extremely difficult. In Senator Hoar's suggestive words, senators went to the White House to give advice, not to receive it.
In connection with revenue legislation the Senate seized the leadership by means of an evasion of the Constitution. According to the terms of that document, all bills for raising revenue must originate in the House of Representatives, but the Senate may propose amendments. Relying upon this power the Senate constantly revised measures to the extent of changing their character completely and even of grafting part or all of one proposal upon the title of another. In one case, early in the period, the Senate "amended" a House bill of four lines which repealed the tariff on tea and coffee; the "amendment" consisted of twenty pages, containing a general revision of customs duties and internal revenue taxes. At a later time the Senate Finance Committee drew up a tariff bill even before Congress had assembled.
The primacy of the Senate quickly led to recognition of the value of seats in it. Influential state politicians sought election in order to control the patronage. Competent judges in the early nineties declared, for example, that the senators from New York, Pennsylvania and Maryland were all of this type. Another considerable fraction was composed of powerful business men, directors in large corporations, who found it to their advantage to be in this most influential law-making body and who were known as oil or silver or lumber senators. So was laid the foundation of the complaint that the Senate was a millionaires' club. And so, too, it came about that much of state politics revolved about the choice of members for the upper house, for senators were elected by the state legislatures until long after 1890. The power of the House of Representatives, in contrast with the Senate, was relatively small except during the single session 1889-1891, when Thomas B. Reed was in control, although individual members sometimes wielded considerable influence.
Somewhat comparable to the shift in the center of power from one federal authority to another, was the change which took place in the relative strength of the state and national governments. This transfer was most clearly seen in the decisions of the Supreme Court in cases involving the Fourteenth Amendment.
Previous to 1868, when the Amendment became part of the Constitution, comparatively little state legislation relating to private property had been reviewed by the Court. Ever since the establishment of the federal government, cases involving the constitutionality of state legislation had been appealed to United States Courts when they had been objected to as running counter to the clauses of the Constitution forbidding states to enact bills of attainder,ex post factolaws, or laws impairing the obligation of contracts. Their number, however, had been relatively small, and normally the acts of state legislatures had not been reviewed by federal courts; or in other words the tendency had been to preserve the individuality and strength of the several states. After the war, the Fourteenth and Fifteenth Amendments placed additional prohibitions on the states, and the decisions of the Supreme Court determined the meaning and extent of the added provisions. The interpretation of the Fourteenth Amendment was especially important. Most significant was the interpretation of Section 1, which reads as follows:
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 and 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.
So vague and inclusive were these phrases that many important questions immediately sprang from them. What were the privileges and immunities of the citizen? Did those of the citizen of the United States differ from those of the citizen of a state? Was a corporation a person? What was liberty? What was due process of law? Hitherto the protection of life, liberty and property had rested, in the main, upon the individual states, and cases involving these subjects had been decided by state courts. Were the state courts to be superseded, in relation to these vital subjects, by the United States Supreme Court?
It has already been shown that the purpose of the Fourteenth Amendment was the protection of the recently freed negro. The Thirteenth Amendment had forbidden slavery, but the southern states had passed apprentice and vagrancy laws which reduced the negro to a condition closely resembling slavery in certain of its aspects. The Fourteenth Amendment was designed to remedy such a condition by forbidding the states to abridge the privileges of citizens, or to deprive persons of life, liberty or property. Were the very vague phrases of the Amendment merely in keeping with the vagueness of many of the other grants of power in the Constitution, or were they designedly expressed in such a way as to accomplish something more than the protection of the freedman?
The first decision of the Supreme Court involving the Amendment was that given in the Slaughter House Cases in 1873, which did not concern the negro in any way. In 1869 the legislature of Louisiana had given a corporation in that state the exclusive right to slaughter cattle within a large area, and had forbidden other persons to construct slaughter-houses within the limits of this region, but the corporation was to allow any other persons to use its buildings and equipment, charging fixed fees for the privilege. Cases were brought before the courts to determine whether the law violated that part of the Fourteenth Amendment which forbids a state to pass laws abridging the privileges of citizens and taking away their property without due process of law. By a vote of five to four the Court upheld the constitutionality of the statute.
The majority held that the purpose of the Amendment was primarily the protection of the negro. This purpose, the Court thought, lay at the foundation of all three of the war amendments and without it no one of them would ever have been suggested. The majority did not believe that the Congress which passed the amendments or the state legislatures which ratified them intended to transfer the protection of the great body of civil rights from the states to the federal government. Neither did they think that due process of law had been interfered with by the Louisiana legislation. In reply to the objection that the slaughter-house law violated the clause, "nor shall any State deny to any person within its jurisdiction the equal protection of the laws," the majority declared:
We doubt very much whether any action of a State not directed by way of discrimination against the negroes as a class, or on account of their race, will ever be held to come within the purview of this provision.
In brief, then, the majority was inclined to preserve the balance between the states and the national government very much as it had been. It believed that the amendments should be applied mainly if not wholly to the fortunes of the freedman and that judicial review of such legislation as that in Louisiana concerning the slaughter of cattle should end in the state courts.
For a time the interpretation of the Court remained that given by the majority in this decision. When western state legislatures passed laws regulating the rates which railroads and certain other corporations might legally charge for their services, the Court at first showed an inclination to allow the states a free hand. Regulation of this sort, it was held, did not deprive the citizen or the corporation of property without due process of law.
There were indications, nevertheless, that the opinion of the Court was undergoing a change as time elapsed. An interesting prelude to the change was an argument by Roscoe Conkling in San Mateo Countyv.Southern Pacific Railroad Company in 1882. Conkling was acting as attorney for the railroad and was attempting to show that the roads were protected, by the Fourteenth Amendment, from state laws which taxed their property unduly. Conkling argued that the Amendment had not been designed merely for the protection of the freedman, and in order to substantiate his contention, he produced a manuscript copy of the journal of the Congressional committee that had drawn up the proposals which later became the Fourteenth Amendment. He had himself been a member of the committee. The journal, it should be noticed, had never hitherto been utilized in public.
Conkling stated that at the time when the Amendment was being drafted, individuals and companies were appealing for congressional protection against state taxation laws, and that it had been the purpose of the committee to frame an amendment which should protect whites as well as blacks and operate in behalf of corporations as well as individuals. In other words, Conkling was making the interesting contention that his committee had had a far wider and deeper purpose in mind in phrasing the Amendment than had been commonly understood and that the demand for the protection of the negro from harsh southern legislation had been utilized to answer the request of business for federal assistance. The safety of the negro was put to the fore; the purpose of the committee to strengthen the legal position of the corporations was kept behind the doors of the committee-room; and the phrases of the Amendment had been designedly made general in order to accomplish both purposes. The sequel appeared four years later, in 1886, when the case Santa Clara Countyv.Southern Pacific Railroad brought the question before the Court. At this time Mr. Chief Justice Waite announced the opinion of himself and his colleagues that a corporation was a "person" within the meaning of the Amendment and thus entitled to its protection.
Later decisions, such as that of 1889 in Chicago, Milwaukee and St. Paul Railway Companyv.Minnesota, left no doubt of the fact that the Court had come to look upon the Fourteenth Amendment as much more than a protective device for the negro. The full meaning of the change, however, did not appear until after 1890, and is a matter for later consideration. In brief, then, before 1890, the Supreme Court was content in the main to avoid the review of state legislation concerning the ownership and control of private property, a practice which lodged great powers in the state courts and legislatures. By that year, however, it was manifest that the Court had undergone a complete change and that it had adopted a theory which would greatly enlarge the functions of the federal courts, at the expense of the states. The medium through which the change came was the Fourteenth Amendment.
The demand on the part of business men for protection from state legislation, which Roscoe Conkling described in the San Mateo case, arose from their belief in the economic doctrine oflaissez faire. Believers in this theory looked upon legislation which regulated business as a species of meddling or interference. The individual, they thought, should be allowed to do very much as he pleased, entering into whatever business he wished, and buying and selling where and how and at what prices suited his interests, stimulated and controlled by competition, but without direction or restriction by the government. It was believed that the amazing success of the American business pioneer was proof of the wisdom of thelaissez fairephilosophy. The economic giant and hero was the self-made man.
Economic abuses, according to thelaissez fairephilosophy, would normally be corrected by economic law, chiefly through competition. If, for illustration, any industry demanded greater returns for its products than proved to be just in the long run, unattached capital would be attracted into that line of production, competition would ensue, prices would be again lowered and justice would result. Every business man would exert himself to discover that employment which would bring greatest return for the capital which he had at his command. He would therefore choose such an industry and so direct it as to make his product of the greatest value possible. Hence although he sought his own interests, he would in fact promote the interest of the public.
Indeed the philosopher oflaissez fairewas sincerely convinced that his system ultimately benefited society as a whole. Andrew Carnegie, an iron and steel manufacturer, presented this thesis in an article in theNorth American Reviewin 1889. The reign of individualism, he held, was the order of the day, was inevitable and desirable. Under it the poorer classes were better off than they had ever been in the world's history. "We start then," he said, "with a condition of affairs under which the best interests of the race are promoted, but which inevitably gives wealth to the few. Thus far, accepting conditions as they exist, the situation can be surveyed and pronounced good." Let the man of ability, he advised, accumulate a large fortune and then discharge his duty to the public through philanthropic enterprises, such as the foundation of libraries. Society would be more highly benefited in this way than by allowing the millions to circulate in small sums through the hands of the masses. Statistical studies of the distribution of wealth seemed to justify Carnegie's judgment that the existing tendency was for wealth to settle into the hands of the few. In 1893 it was estimated that three one-hundredths of one per cent. of the people owned twenty per cent. of the nation's wealth.
Although thelaissez fairetheory was dominant later even than 1890, it was apparent before that time that its sway was being challenged. The adherents oflaissez fairethemselves did not desire to have the doctrine applied fully and evenly. They demanded government protection for their enterprises through the medium of high protective import tariffs, and they sought subsidies and grants of public land for the railroads. Naturally it was not long before the classes whose desires conflicted with the manufacturing and railroad interests began in their turn to seek aid from the government. The people of the Middle West, for example, were not content to allow the railroad companies to control their affairs and establish their rates without let or hindrance from the state legislatures. The factory system in the Northeast, likewise, raised questions which were directed toward the foundations oflaissez faire. Under the factory regime employers found it advantageous to open their doors to women and children and to keep them at machines for long, hard days which unfitted the women for domestic duties and for raising families, and which stunted the children in body and mind. Out of these circumstances arose a demand for restrictions on the freedom of employers to fix the conditions under which their employees worked.
Opposition to an industrial system based uponlaissez fairewould have been even greater during the seventies and eighties if it had not been for two sources of national wealth—the public lands and the supplies of lumber, ore, coal and similar gifts of nature. When the supply of land in the West was substantially unlimited, a sufficient part of the population could relieve its economic distresses by migrating, as multitudes did. Such huge stores of natural wealth were being discovered that there seemed to be no end to them. But in the late eighties when the best public lands were nearly exhausted and the need of more careful husbanding of the national resources became apparent to far-sighted men, advanced thinkers began to question the validity of an economic theory which allowed quite so much freedom to individuals. For the time, however, such questions did not arise in the minds of the masses.
As thelaissez fairedoctrine underlay the problem of the relation between government and industry, so the quantity theory of money was fundamental in the monetary question. According to the quantity theory, money is like any other commodity in that its value rises and falls with variations in the supply and demand for it. Suppose, for example, that a given community is entirely isolated from the rest of the world. It possesses precisely enough pieces of money to satisfy the needs of its people. Suddenly the number of pieces is doubled. The supply is twice as great as business requires. If no new elements enter into the situation, the value of each piece becomes half as great as before, its purchasing power is cut in two and prices double.[2]
A bushel of potatoes that formerly sold for a dollar now sells at two dollars. A farmer who has mortgaged his farm for $1,000 and who relies upon his sales of potatoes to pay off his debt is highly benefited by the change, while the creditor is correspondingly harmed. The debtor is obliged to raise only half as many potatoes; the creditor receives money that buys half the commodities that could have been purchased with his money at the time of the loan.
On the other hand, suppose the number of pieces of money is instantly halved and all other factors continue unchanged. There is now twice as great a demand for each piece, it becomes more desirable and will purchase more goods. Prices, that is to say, go down. Dollar potatoes now sell for fifty cents. The debtor farmer must grow twice as many potatoes as he had contemplated; the creditor finds that he receives money that has doubled in purchasing power.
It has already been said that the quarter century after the war was, in the main, a period of falling prices. The farmer found the size of his mortgage, as measured in bushels of wheat and potatoes, growing steadily and relentlessly greater. The creditor received a return which purchased larger and larger quantities of commodities. The debtor class was mainly in the West; the creditors, mainly in the East. The westerners desired a larger quantity of money which would, as they believed, send prices upward; the East, depending upon similar reasoning, desired a contraction in supply. The former were called inflationists; the latter, contractionists. Much of the monetary history of the country after the Civil War was concerned with the attempt of the inflationists to expand the supply of currency, and the contractionists to prevent inflation.
The intellectual background of the twenty-five years after the war, so far as it can be considered at this point, was to be found mainly in the development of education and the growth of the newspaper and periodical. Before the Civil War, except in the South, the old-time district school had given way, in most states, to graded elementary schools, supported by taxation. After the war the southern states made heroic efforts to revive education, in which they were aided by such northern benefactions as the Peabody Educational Fund of $2,000,000 established in 1867. In the northern states the schools were greatly improved, free text-books became the rule, the free public high-schools replaced the former private academies, and normal schools for the training of teachers were established. The period was also marked by the foundation of scores of colleges and especially of the great state universities. The Morrill Act of July 2, 1862, had provided for a grant to each state of 30,000 acres of public land for every senator and representative in Congress to which the state was entitled. The land was to be used to promote education in the agricultural and mechanic arts, and in the natural sciences. The advantages of the law were quickly seen, and between 1865 and 1890 seventeen state universities were started, most of them in the Middle and Far West. Many of these underwent a phenomenal growth and had a great influence on the states in which they were established.
The newspaper press was also undergoing a transformation in the quarter century after the war. The great expansion of the numbers and influence of American newspapers before and during that struggle had been due to the ability of individuals. James Gordon Bennett had founded the New YorkHerald, for example, in 1835, and from then on theHeraldhad been "Bennett's paper." Similarly theTribunehad represented Horace Greeley and theTimes, Henry J. Raymond. The effect of the war was to develop technical resources in gathering news, to necessitate a larger scale of expenditure and a wider range of information, and to make a given issue the work of many men instead of one. Raymond died in 1869, Greeley and Bennett in 1872; and although theSunwas the embodiment of Charles A. Dana until his death in 1897, theNationand theEvening Postof Edwin L. Godkin until 1899, nevertheless the tendency was away from the newspaper which reflected an individual and toward that which represented a group; away from the editorial which expressed the views of a well-known writer, to the editorial page which combined the labors of many anonymous contributors. The financial basis of the newspaper also underwent a transition. As advertising became more and more general, the revenues of newspapers tended to depend more on the favor of the advertiser than upon the subscriber, giving the former a powerful although indirect influence on editorial policies.
The influence of the press in politics was rapidly growing. A larger number of newspapers became sufficiently independent to attack abuses in both parties. The New YorkTimesand Thomas Nast's cartoons inHarper's Weeklywere most important factors in the overthrow of the Tweed Ring in New York City, and in the elections of 1884 and later, newspapers exerted an unusual power. Press associations in New York and the West led the way to the Associated Press, with its wide-spread cooperative resources for gathering news.
As important as the character of the press, was the amount and distribution of its circulation. Between 1870 and 1890 the number of newspapers published and the aggregate circulation increased almost exactly threefold—about five times as fast as the population was growing. In the latter year the entire circulation for the country was over four and a half billion copies, of which about sixty per cent. were dailies. So great had been the growth of the press during the seventies that the census authorities in 1880 made a careful study of the statistical aspects of the subject. It appeared from this search that newspapers were published in 2,073 of the 2,605 counties in the Union. Without some such means of spreading information, it would have been impossible to conduct the great presidential campaigns, in which the entire country was educated in the tariff and other important issues.
The expansion of the press is well exemplified by the use of the telegraph in the spread of information. When Lincoln was nominated for the presidency in 1860, a single telegraph operator was able to send out all the press matter supplied to him. In 1892 at the Democratic convention, the Western Union Telegraph Company had one hundred operators in the hall. Mechanical invention, meanwhile, was able to keep pace with the demand for news. The first Hoe press of 1847 had been so improved by 1871 that it printed ten to twelve thousand eight-page papers in an hour, and twenty-five years later the capacity had been increased between six and sevenfold.
Nearly all material on party history is so partisan that it should be read with critical scepticism: Francis Curtis,The Republican Party, 1854-1904(2 vols., 1904); J.D. Long,Republican Party(1888); for the Independent attitude, consultHarper's Weeklyduring the campaign of 1884. As the Republicans were in power most of the time from 1865-1913, there is more biographical and autobiographical material about Republicans than about Democratic leaders. Local studies of political conditions and the social structure of the parties are almost entirely lacking. On the personal side, the following are essential: G.F. Parker,Writings and Speeches of Grover Cleveland(1892); T.E. Burton,John Sherman(1906); J.B. Foraker,Notes of a Busy Life(2 vols., 1916), throws light on the ideals and practices of a politician; G.F. Hoar,Autobiography of Seventy Years(2 vols., 1903), gives the New England Republican point of view; Rollo Ogden,Life and Letters of E.L. Godkin(2 vols., 1907); G.F. Parker,Recollections of Grover Cleveland(1909), is useful, but sketchy, there being as yet no thorough biography of Cleveland; T.C. Platt,Autobiography(1910), interestingly portrays the philosophy of a machine politician, but should be read with care; John Sherman,Recollections of Forty Years in House, Senate and Cabinet(2 vols., 1895); Edward Stanwood,James G. Blaine(1905), is highly favorable to Blaine; W.M. Stewart,Reminiscences(1908), is interesting, partisan and unreliable. For a general estimate of the autobiographical material of the period, consultHistory Teachers' Magazine(later theHistorical Outlook), "Recent American History Through the Actors' Eyes," March, 1916.
Jesse Macy,Party Organisation and Machinery(1904); M.G. Ostrogorski,Democracy and Political Parties(2 vols., 1902), gives a keen and pessimistic account of American political practices in vol. II; J.A. Woodburn,Political Parties and Party Problems in the United States(1903, and later editions) gives a succinct account in good temper.
For the Fourteenth Amendment: C.G. Haines,American Doctrine of Judicial Supremacy(1914); C.W. Collins,The Fourteenth Amendment and the States(1912), is a careful study, which is critical of the prevailing later interpretation of the Amendment. The Slaughter House case, giving the earlier interpretation is in J.W. Wallace,Cases argued and adjudged in the Supreme Court(Supreme Court Reports), XVI, 36.
L.H. Haney,History of Economic Thought(1911), onlaissez faire; J.L. Laughlin,Principles of Money(1903); and Irving Fisher,Why is the Dollar Shrinking(1914), present two sides of the quantity theory of money.
Most useful on the development of education are F.P. Graves,A History of Education in Modern Times(1913); and E.G. Dexter,History of Education in the United States(1904).
The growth of newspapers is described inThe Bookman, XIV, 567-584, XV, 26-44; see also Rollo Ogden,Life and Letters of Godkin, already mentioned; G.H. Payne,History of Journalism in the United States(1920); J.M. Lee,History of American Journalism(1917). The effects of education and the press on American social, economic and political life have not been subjected to thorough study.
* * * * *
[1]Addresses on Government and Citizenship, 202.
[2] In practice, new elements do enter into the situation so that the theory requires much qualification. Cf. Taussig,Principles of Economics(1915), I, ch. 18.
Out of the economic and political circumstances which have just been described, there were emerging between 1865 and 1875 a wide variety of national problems. Such questions were those concerning the proper relation between the government and the railroads and industrial enterprises; the welfare of the agricultural and wage-earning classes; the assimilation of the hordes of immigrants; the conservation of the resources of the nation in lumber, minerals and oil; the tariff, the financial obligations of the government, the reform of the civil service, and a host of lesser matters. The animosities aroused by the war, however, and the insistent nature of the reconstruction question almost completely distracted attention from most of these problems. Only upon the tariff, finance and the civil service did the public interest focus long enough to effect results.
The tariff problem has periodically been settled and unsettled since the establishment of the federal government. Just previous to the war a low protective tariff had been adopted, but the outbreak of the conflict had necessitated a larger income; and the passage of an internal revenue act, together with a higher protective tariff, had been the chief means adopted to meet the demand. By 1864 the country had found itself in need of still greater revenues, and again the internal and tariff taxes had been increased. These acts were in force at the close of the war. The internal revenue act levied taxes upon products, trades, and professions, upon liquors and tobacco, upon manufactures, auctions, slaughtered cattle, railroads, advertisements and a large number of smaller sources of income.
The circumstances that had surrounded the framing and passage of the tariff act of 1864 had been somewhat peculiar. The need of the nation for revenue had been supreme and there had been no desire to stint the administration if funds could bring the struggle to a successful conclusion. Congress had been willing to levy almost any rates that anybody desired. The combination of a willingness among the legislators to raise rates to any height necessary for obtaining revenue, and a conviction on their part that high rates were for the good of the country brought about a situation eminently satisfactory to the protectionist element. There had been no time to spend in long discussions of the wisdom of the act and no desire to do so; and moreover the act had been looked upon as merely a temporary expedient. It is not possible to describe accurately the personal influences which surrounded the passage of the law. It is possible, however, to note that many industries had highly prospered under the war revenue legislation. Sugar refining had increased; whiskey distilling had fared well under the operation of the internal revenue laws; the demands of the army had given stimulus to the woolen mills, which had worked to capacity night and day; and the manufacture and use of sewing machines, agricultural implements and the like had been part of the industrial expansion of the times. Large fortunes had been made in the production of rifles, woolen clothing, cotton cloth and other commodities, especially when government contracts could be obtained. Naturally the tax-levying activities of Congress had tended to draw the business interests together to oppose or influence particular rates. The brewers, the cap and hat manufacturers, and others had objected to the taxes on their products; the National Association of Wool Manufacturers and the American Iron and Steel Association had been formed partly with the idea of influencing congressional tariff action.
After the close of the war, the tariff, among other things, seemed to many to require an overhauling. Justin S. Morrill, a member of the House Committee on Ways and Means, and one of the framers of the act of 1864, argued in favor of the protective system although he warned his colleagues:
At the same time it is a mistake of the friends of a sound tariff to insist upon the extreme rates imposed during the war, if less will raise the necessary revenue…. Whatever percentage of duties were imposed upon foreign goods to cover internal taxes upon home manufactures, should not now be claimed as the lawful prize of protection where such taxes have been repealed…. The small increase of the tariff for this reason on iron, salt, woolen, and cottons can not be maintained except on the principle of obtaining a proper amount of revenue.
Sentiment was strong against the tariff in the agricultural parts of the West and especially in those sections not committed to wool-growing. Great personal influence was exerted on the side of "tariff-reform" by David A. Wells, a painstaking and able student of economic conditions who was appointed special commissioner of the revenue in 1866. As a result of his investigations he became converted from a believer in protection to the leader of the opposition, and his reports had a considerable influence in the formation of opinion in favor of revision. The American Free Trade League was formed and included such influential figures as Carl Schurz, Jacob D. Cox, Horace White, Edward Atkinson, E.L. Godkin, editor ofThe Nation, and many others. William B. Allison and James A. Garfield, both prominent Republican members of the House, were in favor of downward revision.
In 1867 a bill providing for many reductions passed the Senate as an amendment to a House bill which proposed to raise rates. Far more than a majority in the House were ready to accept the Senate measure, but according to the rules it was necessary to obtain a two-thirds vote in order to get the amended bill before the House for action. This it was impossible to do. Nevertheless, the wool growers and manufacturers were able "through their large influence, persistent pressure and adroit management" to procure an act in the same session which increased the duties on wool and woolens far above the war rate. In 1869 the duties on copper were raised, as were those on steel rails, marble, flax and some other commodities in 1870.
The growth of the Liberal Republican movement in 1872, with its advocacy of downward revision, frightened somewhat the protectionist leaders of the Republican organization. It was believed that a slight concession might prevent a more radical action, and just before the campaign a ten per cent reduction was brought about. In 1873 the industrial depression so lowered the revenues as to present a plausible opportunity for restoring duties to their former level in 1875, where they remained for nearly a decade.
The lack of effective action on the part of the tariff reformers of both parties was due to a variety of causes. In the years immediately following the war, the Republicans in Congress were more interested in their quarrel with President Johnson than in tariff reform. Furthermore, the unpopular internal revenues were being quickly reduced between 1867 and 1872, and it was argued that a simultaneous reduction of import taxes would decrease the revenue too greatly. Moreover there was no solidarity among the Democrats, the South was discredited, and at first not fully represented. Wells was driven out of office in 1870, the Liberal Republican movement was a failure, the protected manufacturers knew precisely what they wanted, they knew how to achieve results and some of them were willing to employ methods that the reformers were above using. As time went on and the country was, in the main, rather prosperous, many people and especially the business men made up their minds that the war tariffs were a positive benefit to the country. For these reasons a war policy which had generally been considered a temporary expedient became a permanent political issue and a national problem.
The positions of the two political parties on the tariff were not sharply defined during the ten years immediately following the war. The Democrats seemed naturally destined for the role of revisionists because of their party traditions, their support in the South—ordinarily a strong, low-tariff section—and because they were out of power when high tariffs were enacted. Yet the party was far from united on the subject. Some prominent leaders were frankly protectionists, such as Samuel J. Randall of Pennsylvania, who was Speaker of the House for two terms and part of another. The party platform ordinarily was silent or non-committal. In 1868, for example, the Democratic tariff plank was wide and generous enough for a complete platform. The party stood for
a tariff for revenue upon foreign imports, and such equal taxation under the internal revenue laws as will afford incidental protection to domestic manufacturers, and as will, without impairing the revenue, impose the least burden upon, and best promote and encourage, the great industrial interests of the country.
In 1872 the "straight" Democrats, that is those who refused to support Greeley, were for a "judicious" revenue tariff; but in 1876 the party denounced the existing system as "a masterpiece of injustice, inequality and false pretence." Democratic state platforms were even less firm; in fact, the eastern states seemed committed to protection. In Congress, however, most of the opposition to the passage of tariff acts was supplied by the Democrats.
The attitude of the Republicans was more important, because theirs was the party in power. There was, as has been shown, a strong tariff-reform element, and in some of the conventions care seems to have been taken to avoid any definite statement of principles—doubtless on account of the well-known differences in the party—and for many years there was no clearly defined statement of the attitude of the organization. Yet it must be emphasized that Republicans were usually protectionists in the practical business of voting in Congress. Skillful Republican leaders gave way a little in the face of opposition but regained the lost ground and a little more, after the opposition retreated. Since the war-tariffs had been passed under Republican rule, it was easy to clothe them with the sanctity of party accomplishments.
Fully as technical as the tariff problem, and presenting a wider range for the legislative activities of Congress, was the financial situation in which the country found itself in 1865. The total expenditures from June 30, 1861 to June 30, 1865 had been somewhat more than three and one-third billions of dollars, an amount almost double the aggregate disbursements from 1789 to 1861. Officers accustomed to a modest budget and used to working with machinery and precedents which were adapted to the day of small things, had been suddenly called upon to work under revolutionized conditions. Prom the point of view of expense, merely, one year's operations during the war had been equivalent to thirty-six times the average outlay of the years hitherto. As has been shown, the major part of the income necessary for meeting the increased expenses had been obtained by means of the tariff and internal revenue taxes.
The tariff worked to the advantage of many people, and its retention was insistently demanded by them; the internal revenue taxes were disliked, and few things were more popular after the war than their reduction. In 1866 an act was passed which lowered the internal revenue by an amount estimated at forty-five to sixty millions of dollars. In succeeding years further reductions were made, so that by 1870 the scale was low enough to withstand attacks until 1883.
The national debt was the source of more complicated questions. It was composed, on June 30, 1866, of a variety of loans carrying five different rates of interest and maturing in nineteen different periods of time. Parts of it had been borrowed in times of distress at high rates; but after the struggle was successfully ended, the credit of the government was good, and enough money could be obtained at low interest charges to cancel the old debt and establish a new one with the interest account correspondingly reduced. Hugh McCulloch and John Sherman as secretaries of the treasury were most influential in accomplishing this transition, and by 1879 the process was completed and a yearly saving of fourteen million dollars effected.
Differences of opinion concerning the kind of money with which the principal of the debt should be paid brought this matter into the field of politics. When the earliest loans had been contracted, no stipulation had been made in regard to the medium of payment. Later loans had been made redeemable in "coin," without specifying either gold or silver; while still later bonds had been sold under condition that the interest be paid in coin, although nothing had been said about the principal. There was considerable demand for redemption of the bonds in paper money, except where there was agreement to the contrary, although the previous custom of the government had been to pay in coin. The proposal to repay the debt in paper currency, the "Ohio idea," gained considerable ground in the Middle West, as has already been explained. In the campaign of 1868 the Democratic platform advocated the Ohio plan. Some of the Republicans, like Thaddeus Stevens, agreed with this policy; some of the Democrats opposed it—Horatio Seymour, the presidential candidate, among them. Nevertheless the Democratic platform committed the party to payments in greenbacks unless express contract prevented, while the Republicans denounced this policy as "repudiation" and promised the payment of the debt in "good faith" according to the "spirit" and "letter" of the laws. The credit of the government was highly benefited by the payment of the debt in gold, yet the bonds had been purchased during the war with depreciated paper, and gold redemption greatly enriched the purchasers at the expense of the remainder of the population. It is hardly surprising that the debtor classes were not enthusiastic over this outcome. The Republicans on being successful in the election and coming into power, carried out their campaign promises and pledged the faith of the country to the payment of the debt in coin or its equivalent.
The income tax was a method of raising revenue which did not produce any considerable returns until after the war was over. Acts passed during the war had levied a tax on all incomes over six hundred dollars and had introduced progressively increasing rates on higher amounts. Incomes above $5,000, for example, were taxed ten per cent. The greatest number of people were reached and the largest returns obtained in 1866 when nearly half a million persons paid an aggregate of about seventy-three million dollars. The entire system was abolished in 1872.
Aside from the tariff, the "legal-tender" notes gave rise to the greatest number of political and constitutional tangles. By acts of February 25, 1862 and later, Congress had provided for the issue of four hundred and fifty million dollars of United States paper notes, which were commonly known as greenbacks or legal-tenders. The latter name came from the fact that, under the law, the United States notes were legal tender for all debts, public or private, except customs duties and interest on the public debt. In other words, the law compelled creditors to receive the greenbacks in payment of all debts, with the two exceptions mentioned. Three main questions arose in connection with these issues of paper: whether Congress had power under the Constitution to make them legal tender; whether their volume should be allowed to remain at war magnitude, be somewhat contracted or entirely done away with; and whether the government should resume specie payments—that is, exchange gold for paper on the demand of holders of the latter.
The first of these questions was twice decided in the Supreme Court. In 1870, in Hepburnv.Griswold, the point at issue was whether the greenbacks could lawfully be offered to satisfy a debt contracted before the legal-tender act had been passed. As it happened, Salmon P. Chase, who had been Secretary of the Treasury during the war, was now Chief Justice of the Supreme Court and delivered its opinion. By a vote of four to three it decided that the greenbacks were not legal tender for contracts made previous to the passage of the law. At the time when the case was decided, however, there were two vacancies on the bench which were immediately filled, and shortly thereafter two new cases involving the legal-tender act were brought before the Court (Knoxv.Lee, and Parkerv.Davis). The decision, which was announced in 1871, over-ruled the judgment in Hepburnv.Griswold and held by a vote of five to four that the legal-tender act was constitutional as applied to contracts made either before or after its passage.
The second question relating to the greenbacks was that in regard to their volume. At first Congress adopted the policy of contraction and when greenbacks came into the treasury they were destroyed. As continued contraction tended to make the volume of currency smaller and to make money harder to get, and therefore, to raise its value, the debtor classes began to object. As early as 1865 there was strong sentiment against contraction and in favor of paying the public debt in paper. Economic distress in the West furthered the movement and some of the Republican leaders were doubtful of the wisdom of reducing the outstanding stock of paper. Contraction was stopped, therefore, in 1868, and only President Grant's veto in 1874 prevented an increase in the amount. Eventually, in 1878, the amount then in circulation—$346,681,000—was fixed by a law forbidding further contraction.[1]
The western farmers, meanwhile, were feeling the pinch of falling prices. Believing that their ills were due to the scarcity of money, they opposed the policy of contraction and even launched the Greenback party to carry out their principles. In 1876 it polled 80,000 votes, and in 1878 at the time of the congressional elections over 1,000,000, but thereafter its strength rapidly declined. Neither the East nor the West understood the motives of the other in this controversy. Eastern congressmen considered western insistence upon a large volume of currency as a dishonest movement to reduce bond values by legislation. Such an action, they asserted, would do away with the national integrity. The people of the West thought of the eastern bondholders as "fat bullionists" who dined at costly restaurants on terrapin and Burgundy and paid for their luxuries with bonds whose values were raised by a contracted currency.
The third question relating to the greenbacks was that of the resumption of specie payments. At the close of the war practically all the money in circulation was paper, which passed at a depreciated value because it was not redeemable in coin. The obvious thing was to resume the exchange of specie for paper and thus restore the latter to par value, but serious obstacles stood in the way. A money crisis in 1873 aroused a clamor for larger supplies of paper; gold was hard to procure, as France and Germany were both accumulating a redemption fund and specie was actually flowing out of the country. Outside of the treasury there was little gold in the United States, the amount being less than one hundred million dollars as late as 1877. The friends of resumption could not be sure of the feasibility of their project, and the opponents were aggressive and numerous.
In the elections of 1874 the Republicans were severely defeated, and it was seen that the Democrats would have a clear majority in the next House of Representatives. Hence the Republicans hurried through a resumption bill on January 14, 1875—a sort of deathbed act. It authorized the secretary of the treasury to raise gold for redemption purposes, and set January 1, 1879, as the date when resumption should take place. As in the case of the tariff, the political parties found difficulty in determining which side of the resumption question they desired to take. Although the Democratic platform of 1868 contained a greenback plank, yet some of its leaders opposed, and the state platforms of 1875 and 1876 demanded resumption. The national platform of the latter year both denounced the Republicans for not making progress toward resumption and demanded the repeal of the act of 1875, without disclosing whether the party was prepared to offer any improvements. In November, 1877, a bill practically repealing the resumption act passed the House—the western and southern Democrats furnishing most of the affirmative votes, assisted by twenty-seven Republicans. A resolution declaring it to be the opinion of Congress that United States bonds were payable in silver was introduced and advocated by many Republicans. On the other hand, eastern state Democratic and Republican platforms were much alike. Apparently, therefore, differences of opinion in regard to the greenbacks and resumption were caused as much by sectional as by party considerations.
More lasting than finance as a political issue but less enduring than the tariff, was the reform of the civil service. In its widest sense, the term civil service included all non-military government officers from cabinet officials and supreme court judges to the humblest employee in the postal or naval service. The reform, however, was directed mainly toward the appointment and tenure of the lower officers. Before the Civil War the "spoils system" had been in full swing; appointments to positions had been frankly used as rewards for party activity; office-holders had been openly assessed a fraction of their salaries in order to fill the treasure chest at campaign times; rotation in office had been the rule. During the war, President Lincoln had found his ante-room filled with wrangling, importunate office-seekers who consumed time which he needed for the problems of the conflict. As he himself had expressed the situation, he was like a man who was letting offices in one end of his house while the other end was burning down. During the war, also, the patronage at the disposal of the government had vastly increased. Not only had the number of laborers, clerks and officials become greater, but numerous contracts had been let for the production of war materials, and manufacturers and merchants intrigued for a share of federal business. "Influence" and position had been more powerful than merit in procuring the favor of government officers.
After the war many abuses that had earlier been overlooked began to attract the attention of a few thoughtful men. It was estimated that not more than one-half to three-fourths of the legitimate internal revenue was collected during Johnson's presidency, so corrupt and inefficient were the revenue collectors. Endless Indian troubles and countless losses of money resulted from the corruption of the federal Indian agents. Conditions were even worse during the Grant regime. The President's appointments were wretched; he placed his relatives in official positions; revenue frauds amounting to $75,000,000 were discovered during his second administration. In certain departments, it was customary, when vacancies occurred, to allow the salaries to "lapse"—that is, accumulate—so as to provide a fund to satisfy patronage seekers. In one case, thirty-five persons were put on the "lapse fund" for eight days at the end of a fiscal year, in order to "sop up" a little surplus which was in danger of being saved and returned to the treasury. One customs collector at the port of New York removed employees at an average rate of one every three days; another, three every four days; and another, three every five days, in order to provide places for party workers. One secretary in an important department of the government had seventeen clerks for whom he had no employment. The party assessments on officeholders became little short of outrageous. Two or three per cent. of the salary of the lower officers was called for, while the more important officials were expected to contribute much larger sums. In New York—for the system held in the states and cities—candidates for the mayoralty were reputed to pay $25,000 to $30,000; judges, $10,000 to $15,000; and representatives in Congress, $10,000. While these conditions were by no means wholly due to the spoils system, the method of appointment in the civil service made a bad matter worse.
Conditions such as these could hardly fail to produce a reform movement. In fact, as far back as 1853 some elementary and ineffective legislation had attempted a partial remedy. The war gave added impetus to the movement and attention turned to the reform systems of Great Britain and other countries, where problems similar to ours had already been met and solved. The first American who really grasped civil service reform was Thomas A. Jenckes, a member of Congress from Rhode Island. He introduced reform bills in 1865 and later, based on studies of English practice and on correspondence with the leaders of reform there; but no legislation resulted. In brief, his plan provided for the appointment of employees in the public service on the basis of ability, determined by competitive examinations. After a time Jenckes and his associates achieved considerable success and finally interested President Grant in their project. In 1871 they got a rider attached to an appropriation bill which authorized the chief executive to prescribe rules for the admission of persons into the civil service and allowed him to appoint a commission to put the act into effect. George William Curtis, a well-known reformer, was made chairman, and rules were formulated which were applied to the departments at Washington and to federal offices in New York. Grant, although favorable to the reform, was not enthusiastic about it, and soon made an appointment which was so offensive that Curtis resigned. Congress, nothing loath, refused to continue the necessary appropriations and the reform project continued in a state of suspended animation until the inauguration of President Hayes.
The human elements in the struggle for civil service reform, both during the decade after the war and for many years later, are necessary for an understanding of the course of the controversy and its outcome. These elements included the advocates of the patronage system, the reformers and the president.
Sometimes the advocates of the patronage system viewed the reform with contempt. Roscoe Conkling, for example, expressed his sentiments in the remark, "When Dr. Johnson said that patriotism was the last refuge of the scoundrel he ignored the enormous possibilities of the word reform!" Sometimes they attempted to discredit the project by an exaggeration of its effects, as when John A. Logan declared that he saw in it a life-tenure and an aristocratic caste. "It will not be apparent how great is its enormity," he declared in Congress, "how vicious are its practices and how poisonous are its influences until we are too far encircled by its coils to shake them off." The strength of the exponents of the patronage system, however, lay not in their capacity for contempt and ridicule, but in a theory of government that was founded upon certain very definite human characteristics. The theory may be clearly seen in theAutobiographyof Thomas C. Platt, a colleague of Conkling in the Senate and for many years the boss of New York state. It may be expressed somewhat as follows.
In the field of actual politics, parties are a necessity and organization is essential. It is the duty of the citizen, therefore, to support the party that stands for right policies and to adhere closely to its official organization. Loyalty should be rewarded by appointment to positions within the gift of the party; and disloyalty should be looked upon as political treason. One who votes for anybody except the organization candidate feels himself superior to his party, is faithless to the great ideal and is only a little less despicable than he who, having been elected to an office through the energy and devotion of the party workers, is then so ungrateful as to refuse to appoint the workers to positions within his gift. Positions constitute the cohesive force that holds the organization intact.
The second of the human elements, the reform group, was led by such men as George William Curtis, Dorman B. Eaton and Carl Schurz, with the support of periodicals likeHarper's WeeklyandThe Nation. The career and character of Curtis is typical at once of the strength and the weakness of the group. As a young man Curtis had intended to enter a business career, but finding it unsuited to his tastes he had abandoned his ambition, spent some years in European travel and then devoted himself to literary work, first onHarper's Magazineand afterwards, for many years, as editor ofHarper's Weekly. He had early interested himself in politics, had been in the convention which nominated Lincoln, had taken part in numerous state and national political conferences and conventions, was president of the Metropolitan Museum of Art in New York and chancellor of the University of the State of New York. For many years, during the period when civil service reform was making its fight for recognition, Curtis was the president and one of the moving spirits of the National Civil Service Reform League. In politics he was an independent Republican. Although of the intellectual class, like the other prominent leaders of the reform movement, he was a man of practical political ability, not a mere observer of politics, so that he and his associates made up in capacity and influence what they lacked in breadth of appeal. Some of the leaders were patient men who expected that results would come slowly and who were ready to accept half a loaf of reform rather than no loaf at all, but there were also such impatient critics as E.L. Godkin who put so much emphasis on the failures of the reformers as to overshadow their positive achievements. Moreover, there were the well-meaning but impracticable people who constituted what Theodore Roosevelt once called the "lunatic fringe" of reform movements.
The attitude of the exponents of the patronage system toward the reformers was one of undisguised contempt. In a famous speech delivered at a New York state convention in Rochester in September, 1877, Conkling poured his scorn on the reform element in general and on Curtis in particular, as "man-milliners," "carpet-knights of politics," "grasshoppers in the corner of a fence," and disciples of ladies' magazines with their "rancid, canting self-righteousness."
The third personal element in the reform controversy was the chief executive. Beginning with Grant, if not with Lincoln, the presidents were favorable to the progress of reform, but they were surrounded by circumstances that made vigorous action a difficult matter. The task of distributing the patronage was a burden from which they would have been glad to be relieved, yet the demands of the party organization were insistent,—and to turn a constantly deaf ear to them would have been to court political disaster. The executive was always in the position of desiring to further an ideal and being obliged to face the hard facts of politics. The progress which he made, therefore, depended on how resolutely he could press forward his ideal in the face of continued opposition. A great difficulty lay in getting subordinates-in the cabinet, for example-who were in sympathy with progress, and sometimes even the vice-presidential nomination was given to the patronage element in the party in order to placate that faction, while the presidential nominee was disposed to reform.
Public opinion was slow in forming and was lacking in the means of definite expression. For many years after the war there was widespread fear that the installation of a Democratic president would result in the wholesale debauch of the offices, and sober northerners believed, or thought they believed, that "rebels" would again be in power if a Democrat were elected. Under such conditions and because the offices were already filled with Republicans, the Republican North was willing to leave things as they were.
The party pronouncements on civil service reform were as evasive as they were on finance and the tariff. To be surer the Liberal Republicans in 1872 sincerely desired reform and made it the subject of a definite plank in their platform, but the wing of the Democratic party that refused to ally with them was silent on the civil service, and the "straight" Republicans advocated reform in doubtful and unconvincing terms. In 1876 both party platforms were even more vague, although Hayes himself was openly committed to the improvement of the service.
The best work on the tariff is F.W. Taussig,Tariff History of the United States(6th ed., 1914), a scholarly and non-partisan account, although giving slight attention to legislative history; Ida M. Tarbell,Tariff in Our Times(1911), emphasizes the personal and social sides of tariff history and is hostile to protection; Edward Stanwood,American Tariff Controversies(2 vols., 1903), devotes considerable attention to the historical setting and legislative history of tariff acts, and is distinctly friendly to protection.
The most useful single volume on financial history is D.R. Dewey,Financial History of the United States(5th ed., 1915), which is concise, accurate and equipped with full bibliographies; A.B. Hepburn,History of Currency in the United States(1915), is by an expert; A.D. Noyes,Forty Years of American Finance(1909), continues the same author'sThirty Yearsand is reliable; T.B. Burton,John Sherman(1906), is useful here. The legal-tender decisions are in J.W. Wallace,Cases argued and adjudged in the Supreme Court, VIII, 603, and XII, 457.
The standard work on the civil service is C.R. Fish,The Civil Service and the Patronage(1905); the reports of the Civil Service Commission, especially the Fourth Report, are essential; the articles by D.B. Eaton in J.J. Lalor,Cyclopaedia of Political Science(3 vols., 1893), are justly well-known; G.W. Curtis,Orations and Addresses(2 vols., 1894), and Edward Cary,George William Curtis(1894), are excellent. The politician's side may be found in A.R. Conkling,Life and Letters of Roscoe Conkling(1889), and T.C. Platt,Autobiography(1910).
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[1] This is the amount still outstanding.