Mr. MORRILL, of Maine. No; it is not understood to apply to that. That is engraving.

Mr. SHERMAN. Then I have no objection.

Mr. MORRILL, of Maine. I will say in regard to the exception that we have the language of it from the Department itself.

Mr. FESSENDEN. I desire to ask my colleague whether the matter of paying the patent fund into the Treasury was a matter discussed in either House, or whether it is put on by the committee of conference?

Mr. MORRILL, of Maine. It is put on by the committee of conference. The subject was introduced into the bill and was before us, growing out of an appropriation to rent a building to accommodate a portion of the clerks of the Patent Office; and the committee on the part of the House insisted upon some provision of this kind.

Mr. FESSENDEN. How is it in regard to the printing?

Mr. MORRILL, of Maine. This printing was not the subject of any action in either House that I know of.

Mr. FESSENDEN. It originated with the committee of conference.

Mr. MORRILL, of Maine. Yes, sir; but it was involved in the appropriation bill in this way we appropriated $1,500,000 to execute the loan laws; heretofore the appropriation has been more; and the Senate and House disagreed on that appropriation; the House insisting that it was very much larger than was necessary; they agreeing to appropriate, I think, $450,000 only. The House seemed to think that a good deal of the expenditures of that office might be transferred economically to the Government Printing Office, and they insisted upon cutting down the appropriation $250,000.and believed that by transferring the work to the Government Printing Office it could be done at lower rates, and all that portion of the expenses involved in the printing and binding for the several Departments and bureaus saved.

Mr. FESSENDEN. There is no printing done there except blanks used in the Treasury Department, and no binding at all, I think.

Mr. MORRILL, of Maine. Our information on that subject was derived from the head of the Printing Bureau, Mr. Clark. We understood that there was a pretty extensive business of printing and binding for the several bureaus and Departments, not always of a private and confidential character, but of various descriptions, which might as well be done at the proper place.

Mr. FESSENDEN. I do not know what may have grown up there within the last three or four years. I merely made these inquiries to get information. I disapprove entirely of general legislation or legislation of any kind by committees of conference which has not been presented to the two Houses for consideration and discussion. It is very apt to lead to difficulties, and I think is wrong in principle.

Mr. MORRILL, of Maine. I want to take this occasion to say that no man can be more averse to it than I am myself. I have attempted on all occasions to resist it as far as practicable; I think the principle is pernicious; but the Senate will bear me witness that while I have attempted to resist it on these bills the Senate has invariably held that it was the right of the Senate to attach such measures to the bills.

Mr. FESSENDEN. I am speaking of legislation by a committee of conference outside of the Senate. The Senate can put on any. thing it pleases after discussion, and it goes to the House, and is there discussed; but if it is a matter of legislation which is adopted by a conference committee it is settling a question that has not been considered in either branch as it ought to be, and it results in this; that a committee of conference may legislate on matters which have not been before the two Houses.

Mr. MORRILL, of Maine. It was for that

reason that I felt it my duty to explain distinctly to the Senate what there was in this report which was matter of legislation, and to bring it to the attention of the Senate, that they might see how far it was legislation and how far it was germane to the bill.

The report was concurred in.

IMPROVEMENT OF MISSISSIPPI RIVER.

Mr. RAMSEY submitted the following report:

The committee of conference on the disagreeing votes of the two Houses on the amendment of the Senate to the bill (H. R. No. 554) making a grant of land to the State of Minnesota to aid in the improvement of the navigation of the Mississippi river having met, after full and free conference have agreed to recommend, and do recommend to their respective Houses, as follows:

That the House recede from its disagreement to the amendment of the Senate, and agree to the same. ALEXANDER RAMSEY,

T. A. HENDRICKS,
S. C. POMEROY,
Managers on the part of the Senate.

I. DONNELLY,
W. MUNGEN,
Managers on the part of the House.

The report was concurred in.

THE FUNDING BILL.

The Senate, as in Committee of the Whole, resumed the consideration of the bill (S. No. 207) for funding the national debt and for the conversion of the notes of the United States, the pending question being on the amendment of Mr. WILSON to the amendment proposed by Mr. SHERMAN from the Committee on Finance.

Mr. STEWART. Mr. President, I am glad to see the Democratic party again on the aggressive. I am glad that their leader in the Senate has recovered so that he can assume the aggressive. It is gratifying to all his friends that he is able to come forth and put on his armor, and has got again into the war-path. He says that the American people are going to ask some questions; that they are going to ask why we have been compelled to expend so much money, why we have done this and that; but he intimates that they will confine their inquiries to what has been done since the surrender of Lee, and he says that he does not propose to go back further than that time. Let me tell the Senator from Indiana that there are some other questions the American people will ask. They will ask why the Democratic convention indorsed Andrew Johnson's administration, and why they now denounce it as corrupt. We have never denied it. They will ask why it is that the Democratic party plunged this country in civil war, and involved it in a debt of $2,500,000,000. They will ask why that party sought to overthrow the Government. They will ask why it was that not only the present debt, but a vast amount of taxation, running into the thousands of millions, almost beyond computation, has been expended to put down the Democratic rebellion. Especially will they ask why it is that the Democratic party has put forward as its leading standardbearer Horatio Seymour, the leading copperhead of the North, who aided the rebellion more than any other. What does that signify? Why did they abandon HENDRICKS of Indiana? Why did they abandon the Chief Justice of the United States, the head of the great court which is so much respected? Why did they abandon Hancock? Why did they throw all these men overboard? It was to get a representative man who would be acceptable to the rebel wing of their party. They have a representative man. I cannot let this occasion pass without alluding to the significance of this nomination, and the reason why Mr. Seymour

was selected.

Mr. President, Mr. Seymour was a peace Democrat, was an associate and friend of Pendleton, Vallandigham, and of those who opposed the war. Why is it that the Democrats have nominated for President the man of bad eminence, who was Governor of New York in the most critical hour of the rebellion, when everything was trembling in the balance? Why have they taken the man who, when the South

was red with loyal blood, when the hearts of all men beat with anxiety, went to the Academy of Music in New York, on the 4th of July, 1863, in company with Pendleton and others, there and then to advocate resistance to the draft, there and then to proclaim to the excited people of New York city, that a mob had an equal right to proclaim the law of necessity with a Government? Why did they take the men who, on the 4th of July, 1863, told the American people that the war was a failure, and that the only way to preserve their liberty was to resist law? Why did they take the man who, on that occasion sneered at every effort of this Government to maintain its own existence? Why, above all things, did they pass over every patriotic name and take up the representative of the cold-blooded, treasonable peace Democracy? I will tell you the reason. If anybody doubts his record I have before me a small portion of it, and I can produce more. One or two extracts are enough. He commenced his speech on the 4th of July, 1863, thus:

"When I accepted the invitation to speak, with others at this meeting, we were promised the downfall of Vicksburg, the opening of the Mississippi, the probable capture of the confederate capital, and the exhaustion of the rebellion. By common consent, all parties had fixed upon this day when the results of the campaign should be known, to mark out that line of policy which they felt that our country should pursue. But in the moment of expected_victory, there came the midnight cry for help from Pennsylvania to save its despoiled fields from the invading foe; and, almost within sight of this great commercial metropolis the ships of your merchants were burned to the water's edge."

That was the way he talked. Why is it that they put him at the head of their ticket, a man who used such language on the day when the invincible Grant took Vicksburg? Why is he selected? I call the special attention of the loyal Senator from Indiana, whose virtues that convention could not appreciate, to the following beautiful sentences of his successful rival:

"Are you not exposing yourselves, your own interests, to as great a peril as that with which you threaten us. Remember this?"

He was discussing the draft and advising them in this very speech to defend their hearths, declaring the draft unconstitutional, declaring that the Government of the United States had no right to enforce it. He said:

"Remember this, that the bloody, and treasonable, and revolutionary doctrine of public necessity can be proclaimed by a mob as well as by a Government." That is the language of your presidential nominee.

Mr. HOWARD. Read it again.

Mr. STEWART. "Remember this, that the bloody, and treasonable, and revolutionary doctrine of public necessity can be proclaimed by a mob as well as by a Government."

And within eight days from that time the most disgraceful mob that mars the good name of our nation was raging in the very metropolis of the State of which he was Governor, vindicating his words, taking the ground that they had as good a right to proclaim the law of necessity by which they might take life and destroy property as the Government of the United States. He was the representative of the idea of mob violence. Every line of that speech contains a suggestion to disobey the law. The mob came and you say he helped to put it down. I say he ought not to have advised his friends to enter into it.

But I will proceed a little further. I have another one of Governor Seymour's speeches which he made to the mob. It was after this mob had raged some days, after he had got a little news from Vicksburg, and a little news as he was on the 4th of July. Then he makes from Gettysburg, and he was not quite so brave a speech, and he calls them "my friends." This mob had burned down orphan asylums, had gibbeted men in the streets, and had destroyed $2,000,000 of property, which the city of New York has since refunded. He calls this mob of blood and violence "my friends," and he says to them:

"I have come down here from the quiet of the country to see what was the difficulty; to learn what all this trouble was concerning the draft."

He had been there on the 4th; he had told them about the draft; he had made a speech, and so had Pendleton and Seymour of Connecticut and O'Gorman, and they had agreed, one and all, that the mob had the right to take this matter into their hands. Then he returned to the country, and comes down after they had been killing and murdering for several days, and he says:

My friends: I have come down here from the quiet of the country to see what was the difficulty; to learn what all this trouble was concerning the draft. Let me assure you that I am your friend. Uproarious cheering.] You have been my friends, [cries of Yes, Yes,' That's so;''We are and will be again;'] and now I assure you, my fellow-citizens, that I am here to show you a test of my friendship. [Cheers.] I wish to inform you that I have sent my adjutant general to Washington to confer with the authorities there, and to have this draft suspended and stopped. [Vociferous cheers.] I now ask you, as good citizens, to wait for his return; and I assure you that I will do all that I can to see that there is no inequality, and no wrong done any one. I wish you to take good care of all property as good citizens, and see that every person is safe. The safekeeping of property and persons rests with you; and I charge you to disturb neither. It is your duty to maintain the good order of the city; and I know you will do it. I wish you now to separate as good citizens, and you can assemble again whenever you wish to do so. I ask you to leave all to me now, and I will see to your rights. Wait until my adjutant returns from Washington, and you shall be satisfied. Listen to me, and see that no harm is done to either persons or property, but retire peaceably."

The meeting at the Academy of Music was brought together for the purpose of inflaming the people against the draft, and the Governor of the State, who held the reins of power to enforce the law, was there, telling them that they had as much right to do that as the Government had to enforce the draft, and after they had done their bloody work he tells them, "Wait a little while; if we have not scared the Government enough yet so that they will || yield and surrender to us, you may reassemble."

Why is it that this man was nominated? Is there not some purpose to be carried out? There is a little piece of evidence that explains that. There is a war to be prosecuted. I hold in my hand the letter of his colleague on the ticket, Mr. Frank Blair. Mr. Frank Blair, it is true, was once a Republican; but in order to secure a nomination at New York he sent to that convention a manifesto which the Senator cannot approve, from which he recoils with horror; which, excuse it as he must, he cannot but condemn; and he says that upon that letter he wants the nomination. In that letter he declares that seven States shall be expelled from this Union by force of arms if his friends are successful. He declares for war, and declares that they have a right to expel States.

Mr. MCCREERY. Will the Senator read any portion of Mr. Blair's letter that declares for war.

Mr. MCCREERY. Just read one sentence. Mr. STEWART. The letter says this: that it is idle to talk of legislation to accomplish the purpose; it cannot be passed through the Senate, and therefore the President must upset these governments, treat them as nullities, and call upon the military commanders to undo the work that has been done there, overturn them all. Why was he selected? What do they propose? They propose war. The American people want to know why it is, after four years of bloody war, after such vast expenditures of blood and treasure, after years of effort to restore the country, when we are returning to our habits of industry and economy and peace, Horatio Seymour, an advocate of mob violence, Horatio Seymour, who proclaimed the war a failure, Horatio Seymour, who denied the right of this nation to maintain its own existence, is placed as a candidate by the Democracy at the head of the ticket. They will want to know why Vallangham placed him there. They will want to know why Vallandigham took him by the neck

and said, "No, you shall not resign." They will want to know why Forrest, of Fort Pillow notoriety, eulogized him. They will want to know why he is the special friend of Wade Hampton. They will want to know why these gallant chieftains of the rebellion brushed the loyal Democrats, like so many flies, behind them, and took this chieftain of the peace Democracy, odious in the nostrils of the people, held him up, and shook him over that convention amid the cries of the bewildered and befooled western delegates.

These are some of the questions the people will desire to have answered. They will want to know why the delegates from the West and from the East congregated in that modern city of iniquity allowed themselves to be hoodwinked and allowed him to be placed in that position. I tell you, Mr. President, the object of putting him there, the embodiment of the peace Democracy, the embodiment of opposition to the war, the embodiment of the slaveruling idea, the embodiment of everything that is anti-American, anti-progressive, and antiDemocratic, is to endeavor to reverse by the verdict of the people the verdict of the war. They put him there to do honor to the lost cause. They put him there to condemn the efforts of the loyal people of this nation to maintain this Government. They put him there knowing that his election above that of any other man would be a condemnation of the war, would be a repudiation of everything loyal, just, and noble. They put him there to insult the memory of those of our noble heroes sacrificed by his neglect. They put him there because they believed that with him they could most effectually humiliate Grant. They put him there because they had grown brave and rash. They put him there because they were on the aggressive and had determined to make loyalty odious. They put him there because they intended to make every Union, libertyloving man in the country bow down in the dust. They put him there in a fit of overconfidence, to please their southern friends, to revive the rebellion, to reverse the order of things.

man's Government for the sake of treason? It will not be a white man's Government when you have done; it will be a rebel Government, in which the poor, white and black, will be trampled into the dust, as they ever have been. Why tear down governments based upon equal rights where all are protected? Why tear down governments which are an honor to the American name? The American people will pause long before they enter upon this work.

The verdict is already recorded. My friend from Indiana sees the handwriting upon the wall. Let him go home to his State. Let him go home and fight for his individual self there. Nobody has any personal hostility to him. Let him make his own fight as he can ; but after the convention has repudiated everything that looks like loyalty or love of country, when they put up nothing but the black idols of rebellion for him to worship I beseech him not to load himself too heavily with the record of Blair and Seymour; it may endanger his own little fight in that great State which he seeks to govern. But this attempt to elect such men with such a record means that every loyal man is to be humiliated and trampled in the dust. It means that the debt is be repudiated, the honor of the nation to be destroyed. It means a dissolution of the Union by the expulsion of States, because Blair distinctly stated it and desired to be nominated on that issue. It comes to us in that shape; and if the deserters, the traitors, the cowards, and the rebels were right; if the American people think they were right and we were wrong all the time; if all the Union armies were wrong, then let the verdict be recorded that Grant is the greatest murderer that ever was or ever can be in history; then let Sherman and Sheridan and Thomas be disgraced; let their names be stricken from the rolls of the Army; let none but traitors be placed there; let Lee take the place of Grant and Forrest of the gallant Sheridan; stop paying your pensions to the widows of the soldiers who have fallen; let anarchy reign supreme; ratify the glorious doctrine of your leader, that mob violence is as legitimate as governmental power; adopt the motto, "Let ruin come again."

But now the amazement and the chagrin that are felt show that they mistook the tem- But, sir, the American people are not so inper of the people. They forgot that the evil clined, and however aggressive my friend from he had done was still remembered. They Indiana may be in defending the forlorn hope might have taken Hendricks or Hancock or of his successful competitor in the New York somebody who was not identified with riot and convention, he will make very little impression bloodshed and treason to the Government. on the country except that he intends to be They see that they have made a great mistake. true to his party, that he means to prove to It was the over-confidence of the rebels in the the world that his head is not sore although his beginning that they could overthrow the Gov- heart aches a little, and he is very much disernment which made them light the torch of gusted with the proceedings of the convention. civil war. It was their over-confidence that He has said enough on that subject; let him led to their destruction. It is the over-confi- leave it to a generous people. They will not dence of these schemers for a new rebellion condemn him too severely, they will sympathat has opened the eyes of the people; and I thize with him; but he must not attempt to get tell you when the contest is ended the record them to worship at the altar of Seymour or of those who stood by the country during the Blair, because they will not be persuaded. He war will be vindicated. The people will main- must not try to transfer the love and admiratain those who stood for the Government tion felt for him to two such men representing through the sorrows, losses, dangers, and pri-such ideas as they do, because he will fail in vations of the war. They are not willing to that and they will cease to confide in him. reverse its verdict. They are not willing to humiliate loyalty. They are not willing to renew the war for the sake of reestablishing peonage or slavery in the South. Why should not people desire peace and security and Union? Why should they wish to put Vallandigham, Hampton, Vance, and Forrest in power? What have these worthies done to merit office? They will not stop to talk about little quibbles in regard to the consistency of the Republican party or little irregularities in carrying on the war. They know that our financial troubles since the war grew out of the corruption of Johnson's Democratic administration. They are not willing to reverse the verdict of arms, to rerivet the chains of the slave, and to make this a white man's Govem. ment for the benefit of a few arch-traitors. Those who raise this cry do not propose to make it a white man's Government for the sake of the white man, but for the sake of treason. Why should this be made a white

Mr. CORBETT. Mr. President, the provision now proposed inaugurates a new system which, it seems to me, would be very detri mental to the interests of the United States. The amendment of the Senator from Massachusetts provides for imposing upon our bonds a tax of one half of one per cent., which has certainly never been attempted by the Government before. These bonds have been popular, and will continue to be more popular if we maintain our public faith, provided we do not tax them. We have always contended, and the Supreme Court of the United States has decided, that United States Government bonds cannot be taxed; that it is necessary for the Government to have power to issue bonds free from taxation so as to maintain the national credit, to be able to protect ourselves from incursions from abroad and to subdue rebellions within. If we now inaugurate a system of taxing the bonds one half of one per cent. there is nothing hereafter to hinder Congress from taxing them

one per cent. or two per cent., and when we commence that we do not know where it will stop. Once begin that system, and those abroad who have invested their money in United States Government stocks will send them home very soon. Confidence will be destroyed. Persons who hold stocks from the income of which a tax is deducted will not wish

to hold them longer. Thus, the stocks held abroad will be returned upon us, and the result will be that we shall have to send gold or something else out of the country to pay for them. We are not in a condition now to send

anything abroad. We are not sending anything abroad in place of gold. In three months, since the 11th of March last, we have sent abroad over thirty-eight million dollars in gold in consequence of the decline of United States securities in foreign markets. One reason of that decline is the agitation of the question

whether the bonds of the United States Government shall be taxed, and whether we are going to repudiate this debt or not. All these considerations have had their effect on the price of the bonds, and the result is that gold is going out of the country instead of United States bonds, and we have got to send something out of the country by and by, as we are sending out gold at the rate of $120,000,000 a year, and only producing sixty or sixty-five million dollars. We certainly must stop sending gold very soon or we shall be bankrupt.

It seems to me that the principle proposed by this amendment in place of the present bill is one that will be very injurious. I would rather have a bond specifying upon its face only four and a half per cent. interest than a bond for a higher rate conceding the right of the Government to tax it. Reduce the rate of interest as you may think best in your wisdom, but do not tax the United States bonds. It will destroy the market for them abroad, and destroy the confidence of your own people in them.

I see no objection to the present bill as the Committee on Finance propose to amend it, with the exception of section three, which think should be stricken out. I have had some little conversation, and attempted to inform myself as to the effect of that section, and my opinion is that it will only tend to create embarrassment and to court speculation in the money markets of the United States at the great commercial centers.

Now, in New York city if stock brokers and speculators desire to create a panic in the money market they go to the banks, and, borrowing all the money they have to lend, seal it up and deposit it for security for thirty days or more, saying to them, "We will pay you interest on this money; but we want it sealed up and placed in your vaults." That takes it from the circulation of the country. An association of men in this way who desire to control the stock market may with $250,000 withdraw $50,000,000 of currency from circulation if they choose. In thirty days they can produce such a stringency in the money market as to reduce the price of stocks to the extent of five, ten, or fifteen per cent. Having done this, they let the money loose again, and in a very short time up go the securities ten, fifteen, or twenty per cent., and they thereby make large fortunes.

I think the provisions of the third section will tend to favor those who seek to bring about such results. If this additional $44,000,000 is placed in circulation it certainly adds $44,000,000 to the circulating medium of the country. The result of the section will be that those holding bonds can at any time go to the Treasury and deposit those bonds and withdraw the money in the Treasury from circulation, provided there is not at the time a total of $400,000,000 in circulation. Men can go to the Treasury, deposit $50,000,000 of bonds, and at once withdraw $50,000,000 of legal tenders from the Treasury, and we must wait for that money until it comes in from taxation. If the men put the money away, the result of the operation is to reduce the circulating medium of the coun

try for the time being $50,000,000, and these men give up four and a half or five per cent. upon the $50,000,000, whereas now in order to control the market they have to pay seven per cent. to the banks. Here is a saving of two or three per cent. by this way of controlling the stock market and making a crisis every now and again under the third section.

Mr. President, what the people of this country desire is stability, something that they can depend on, something that they know will not create distrust and will not be a disturbing element in the money market. They desire to know how much circulation there is in the country and to make their calculations accordingly. If we have a stated amount of circulation, and the only increase is the gold that comes into the country, they can make some calculations in regard to their business transactions; but if you have a circulation that is exchangeable from currency into United States bonds and from United States bonds into currency there will be doubt and uncertainty. When money is easy people will be investing their money in United States securities, and when there is a panic in the market they may convert their bonds into greenbacks, so as to lend them at a high rate of interest. Thus there will be a constant change from one to the other, and men can make no safe business calculations. Such a provision in the bill will have a tendency to disturb the money market and cause more distress than even the present state of things. Now, money is plenty in New York; it can be had for short loans on good security at three and a half, four, or five per cent. At another period of the year money will be scarce there, because it will be wanted in the West to move the crops. If you issue this increased amount under the third section how are they going to get this money in the West? They will not get it. Persons who hold bonds will deposit their bonds with the Assistant Treasurer at New York, draw the greenbacks, increase the currency, and probably reduce the rate of interest there; and there will be speculations to advance the prices of stocks, and when money is wanted West to move the crops there will be a tight money market and financial distress. The bonds may be presented to the Government for currency at a time when the Government has not the money to spare, when it may not have over forty or fifty millions in the Treasury, and under this provision every cent of it may be drawn out and the Government left without the means of defraying its current expeuses. There is no guard at all around this provision.

If

If the third section were stricken out I should think the bill unexceptionable. The other sections provide that the new bonds provided for shall be issued and sold or exchanged for the existing loans now outstanding. It is at the option of the holders of the present bonds whether they will exchange them or not. they desire to get a permanent loan, something that they are sure of, something which is clear and undoubted on its face, this provides for it, and they can so exchange. In that respect I think the bill is well drawn; but at the proper time I propose to move to strike out the third section.

The PRESIDENT pro tempore. The ques tion is on the amendment of the Senator from Massachusetts [Mr. WILSON] to the amendment of the Committee on Finance.

The amendment to the amendment was rejected.

Mr. HOWARD. I wish to offer an amendment to that section which relates to gold contracts, to come in at the close of the clause. think it will address itself to the good sense I do not propose to make a speech upon it; I of every Senator. My amendment is to add to the section:

Provided, That this section shall not apply to the renewal or extension of an indebtedness under a contract already entered into.

Mr. CORBETT. I do not see that that would affect particularly the States on the Atlantic side, but it might those upon the Pacific.

They have gold contracts there now under existing laws called specific contract laws. I do not know whether this amendment would interfere with the extension of their contracts. If this should supersede their laws, the law of Congress overriding the law of the State, it might work injury to those interests.

Mr. HOWARD. I can modify it so as to except all those cases.

Mr. SHERMAN, I have a modification of that amendment which, if the Senator from Michigan will allow me to state, I am willing to adopt. To avoid the argument that has been made I am willing to adopt this proviso instead of the one he proposes:

Provided, That where the stipulation to pay coin is a device to secure illegal or usurious interest, it shall not be enforced.

This is what the Senator wants: where the

stipulation to pay coin is a device of the party to impose illegal or usurious interest it shall not be enforced. That is as far, I think, as we can go to limit contracts.

Mr. HOWARD. That is not so far as my amendment contemplates going. My amendment contemplates exactly this: that where contracts have been made not payable in gold, and now exist, any contract for the renewal or extension shall not be made in gold, but shall rest upon the same basis as it rested originally. That is my idea.

Mr. WILLIAMS. I have never been im

pressed as much as some others with the necessity or advantage of this section; and the criticisms made upon it yesterday by the Senator from Minnesota and the Senator from Wisconsin seemed to me to have some plausi bility, at any rate, if not foundation in fact.

I believe that this section ought to be so amended as to except loans of currency, and I would suggest to the Senator from Michigan that he amend his amendment so as to provide that persons who desire to borrow currency shall not be required to give contracts payable specifically in gold, for I can very readily understand that great hardships may be imposed in that way upon persons whose necessities compel them to borrow money; and the object of this provision is to enable those persons who are required to make use of gold for the payment of customs duties or otherwise, to make contracts by which they can buy gold. Here are money-lenders scattered all over the country. There are men whose necessities require them to go to these persons for accommodation. A man, perhaps, expecting that at some time not very far distant specie payments will be resumed, or, induced by some other consideration, may enter into a contract by which he borrows a certain amount of money. in currency and agrees to repay it in gold. Thousands of men may be induced to enter into contracts of this kind, and the consequence will be that they will put themselves entirely in the power of the money-lenders, who are scruples, as a class, in pursuing their debtors. notorious for having no conscience, or no

Mr. HOWARD. I have modified my amendment to read thus:

Provided, That this section shall not apply to the renewal or extension of an indebtedness under a contract already entered into, unless such contract originally required payment in coin.

Mr. CONKLING. That amendment enables me better to put a question to the Senator from Oregon. Suppose the amendment is adopted first for my illustration, who is it going to protect? One man has borrowed money from another; the debt has fallen due; he goes to him to rearrange it. This provision would not extend to that contract. The creditor therefore says, "I will not extend this debt; you must pay me now;" and in order to raise the money with which to make the payment he must go to the next man and make a fresh contract with him answerable in coin; so that it would be the old case which has been caricatured in the play and a thousand times in real life of a man saying, "I cannot lend you this money, but I have a friend or a brother who can do it." So in the case supposed by the Senator from Oregon, I ask him

whether if his amendment be, as I understood him to suggest, that contracts heretofore made payable in currency should not, in any event, be answerable in coin

Mr. WILLIAMS. My amendment, if I was to draw one, would be to change the section so as to make it read "that any contract hereafter made-excepting for loans of currencyspecifically payable in coin, shall be legal and valid." I claim that where a man borrows currency, if his necessities, or the power which the lender has over him, induce him to give a contract payable specifically in gold for the currency, it ought not under existing circumstances to be enforced.

Mr. CONKLING. Take that very case; the debtor comes to the creditor to get an extension. The creditor says, "No; I will not extend this a moment; you must pay me now or I shall sue you on your note." Is he not then at once driven to go to the next man, who is either in concert with the creditor or not, as you please, to borrow from him in a coin answerable to contract in order to get the money to come back and pay his creditor? Mr. WILLIAMS. I think not. Mr. CONKLING. Why not?

Mr. WILLIAMS. In the first place, I suppose the question assumes that the existing contract is payable in currency. If that be so, and the debtor is unable to pay, the creditor will sue and recover a judgment for currency, and the debtor's property will be sold for currency, his debts will be paid in currency. But if he enters into a contract specifically payable in gold, under this bill the judgment will be for so much gold.

Mr. CONKLING. I wish my honorable friend to enlighten me upon this point. Of course if the contract is returnable in currency, and proceedings are taken to enforce it, the case will be as the Senator states; but suppose, to avoid a suit and seizure of his property on execution, the debtor goes to some other person to borrow this money with which to pay, then he is brought immediately within the scope of the law as it would be after the amendment is adopted. So I ask the Senator how it is in reality that it amounts to a protection even in the case he puts?

Mr. WILLIAMS. I do not think the Senator understands the amendment I propose. Suppose that A goes to B to borrow money, and B insists that if he loans him currency A shall make a contract specifically payable in coin. A declines to do it, and he is compelled to go to C to borrow the money. He can no more make a contract specifically payable in gold with C to bind him than he could make a contract with B payable in gold to bind him. He cannot make a contract payable in gold with anybody for the purpose of borrowing currency. That is the extent of my amendment. It is to hold that a man shall not be compelled upon a contract which he makes for the purpose of borrowing currency under any circumstances to refund the amount in gold.

Mr. CONKLING. Suppose I go to the Senator under the law as it would stand with this amendment to borrow $100 in currency, and suppose I make a contract to repay him coin less forty per cent., gold being at 140, would not such a contract as that be within the law as he intends to make it?

Mr. WILLIAMS. I do not understand that any contract made for the purpose of borrowing currency, where the payment is specifically to be made in coin, would be a contract which could be enforced under this law, no matter what the amount specified in the contract might be. Mr. CONKLING. That is, it would not be valid unless coin had been paid out and coin was to be received back?

Mr. WILLIAMS. Certainly, that is what I

mean.

Mr. CONKLING. Surely the Senator must see that the moment such a law as that is passed contracts are restricted to the sale of property, because if I cannot go to the Senator and borrow $100 in gold, and in place of gold repay him $140 in greenbacks, the currency of the

country, equivalent to gold at the market value, gold being now demonetized, it is entirely impossible that any transaction should take place under the law except it may be to sell my chattels or real estate and take an agreement payable in gold, so that this would not be a commercial law at all.

Mr. COLE obtained the floor.

Mr. TRUMBULL. Will the Senator from California give way for a motion to go into executive session? That will afford an opportunity for these other Senators to confer and come to understand each other, so that we shall get along more speedily hereafter.

Mr. COLE. I have but a few remarks to offer at this time. If the Senate, however, desire to go into executive session I shall not insist on addressing them at this moment.

Mr. SHERMAN. I know the Senator from Illinois wants an executive session, but I trust he will not interpose at this time, and will allow us to go on with this bill. I have seen a great majority of the Senators, and they have told me they are disposed to close this bill to-night. If so, I hope we shall sit on until the hour comes for the recess, and then take the recess, and sit it out to-night, and to-morrow the Senator can have his executive session in time to accomplish something, but if we go into executive session now we shall accomplish nothing before the recess.

Mr. TRUMBULL. Oh, yes; we shall be able to do something by going in now.

Mr. MORRILL, of Maine. I desire to give notice to the Senate that on to-morrow the Committee on Appropriations are extremely anxious to present to the consideration of the Senate the Indian appropriation bill.

Mr. TRUMBULL. I hope, then, the Senator from California will give way and let me move an executive session. We certainly ought to do some executive business.

Mr. COLE. As the chairman of the Committee on Finance, who has this bill in charge, is extremely anxious that it should be disposed of to-night, I prefer to go on. This is a part of the bill in which I have from the commencement taken very considerable interest, and though I am in favor of every section of the bill this is the only one upon which I propose to offer any remarks.

Gold and silver have always been the currency in the State which I have the honor in part to represent. The late war, which drove hard money from circulation in the Atlantic States, produced no such result on the Pacific side. Greenbacks have all the while been bought and sold there precisely as gold and silver have been bought and sold in the markets of New York. They have been used to pay Federal taxes and the salaries of Federal officials, but further than that they have not entered into business on that coast. This unusual condition of things is attributable mainly to the fact that banks of issue never had an existence in that State. By her constitution they are prohibited, and before the advent of United States notes her people had no paper money whatever. The facility, therefore, which existed in other States for gliding from the use of one description of paper money into the use of another was wholly wanting in California.

The prime obstacle in the way of bank paper, and afterward greenback circulation, there was the large production of gold, which first led to this constitutional prohibition upon banks of issue.

This condition of things impelled the Legislature of that State to pass a law which is known there as the "specific contract law." It provides that any agreement in writing to pay in coin may be enforced according to its terms. I need not now discuss the validity of such a statute, the local courts having sustained it, and its principles having entered into thousands of business transactions. It is sufficient to say that the necessity for such a law and such a decision was far more pressing in California than in any other State of the Union.

That law effected for California precisely

what is sought to be effected for the whole country by the section under consideration. It is intended simply to modify the legal-tender act so as to allow the making and enforcing of contracts to pay in coin, if people shall choose to make such contracts.

United States notes will remain a legal tender, as at present, for all debts public and private unless the specific agreement calls for something else. If there is a single sound objection to this measure it has not yet ap. peared.

The proposition has been before the country since early in December last, and has elicited much comment from the public press and from private citizens; but I have not heard a single solid reason urged why it should not become a law. It is said that sharpers will take advantage of it to oppress their debtors, by exacting payment in coin where only paper money is due. But this is not likely to occur. No man would exact and no one submit to pay forty per cent. in addition to his debt. This objection to the measure is imaginative, not real. No such advantage could be taken of it. The arguments in its favor, though not numerous, are, in my opinion, forcible. They address themselves directly to the practical sense of the people. There is no compulsion about this measure. The adoption or rejection of its principles is left entirely to the volition of each individual. Unlike every other financial scheme, it is totally devoid of pressure to secure its adoption, and yet there is no doubt it will go into operation. Its own merits will ensure its success. Coin contracts will most certainly be made. Whenever credit is given both parties will prefer it shall be upon the basis of hard money, because that will ensure to both greater safety and certainty. Instead of continuing the undivided use of a standard of value, which is scarcely any two days the same, and which, within the life-time of many a contract, has ranged from par down to forty cents on the dollar of gold, all good business men will substitute the world-wide, time-honored and more steady standard of the precious metals. This standard is not affected by the misfortunes of any nation, but, like the waters of the ocean, keeps on the same grand level throughout the whole world, and is only subject to inconsiderable tides.

Uncertainty in the value of the circulating medium enhances the prices of all commodities, and as well those of prime necessity as those that can easily be dispensed with. The tradesman cannot safely assume the risk of a sudden decline in the value of greenbacks, and he must therefore preserve a larger margin of profits on his sales. The importer and manufacturer must do the same, and the unfortunate consumer at last has to bear the burden.

Mr. President, this bill is calculated to encourage and promote business of every sort. It will restore confidence where now is only distrust. Let us illustrate its workings by presuming a case. Suppose you have for sale a piece of property valued at $10,000 in the ordinary currency, you would just as readily take its equivalent in gold, $7,000. And if the payment were to be postponed one, two, or three years, both the purchaser and yourself would still prefer to specify the $7,000 in coin as the price rather than the $10,000 in a fluctuating and uncertain medium.

All prices are now exorbitant and unnatural. This provision will reduce them to what they were before the war, because they will again be measured by the same standard of value. They will be brought down to the same general level that they have continued to occupy in California. There the only changes in prices have been such as ordinarily flow from supply and demand.

The rise and fall of greenbacks from time to time have produced as little effect upon values there as in England.

There being but little use for coin in this country at present, it goes abroad, too often in exchange for products we do not need. But the passage of this bill, by creating a necessity

for it, will keep the coin at home. The amount of coin in the Atlantic States at this time must be very small. There is, on the average, about ninety millions in the Treasury, and outside of it probably not a very much larger sum. The only demand for it is to pay duties on imports; and the brokers and bankers retain a little for speculation, but most of it has gone out of the country because not needed here. All Californians, on landing in New York, rush to Wall street to sell their gold, and I suppose everybody who happens to have a little or much is equally anxious to convert it into some more useful form. Those who had coin hoarded up before the war have been forced by necessities, or tempted by large premiums to sell it, and there is but little of this sort of dead capital remaining in the country. The speculative character of our people precludes the idea that any considerable quantities of the precious metals are hid away in chests and corners. The fact that there is but little coin in the banks is shown by the propo sition to day discussed, asking for the issue of more three per cent. certificates to be used as their reserve. Ofthose certificates, $50,000,000 are already out. And as gold and silver, being lawful money, may constitute a part of the reserve, it certainly leads to the conclusion that there cannot be much coin in the national banks.

Every contract to pay in specie is in effect an agreement that so much gold shall be retained in the country to meet it; and when such contracts become common, as they will, gold and silver will be found sufficient for the demands of business, and we shall reach a specie basis almost without knowing it, and without the slightest injury to anybody.

Every other method yet proposed for returning to specie must lead to injustice, by enforcing the payment of debts in coin, which were contracted upon the basis of a depreciated paper currency. There is no plan so fair as this for reaching a specie basis, and no other which will not produce convulsions in business and lead to untold distress throughout the country.

But if it be true, as often alleged, that a large amount of gold and silver is hoarded up in this country, why should it not be unlocked? What reason is there why it may not be allowed to go into circulation, so that the people may become accustomed to its use again? If we are ever to go back to specie it must be by some such gradual process, and not by a single stride. If we should blindly adopt one of the many suggestions upon this head, and declare that on a certain day the Government would resume payments in specie, the gold in the Treasury would last so long, and only so long, as would be required to transfer it to the broker shops, and after that single day or so of specie payments we should be further than ever from the end aimed at. The country would find itself absolutely at the mercy of the "gold ring," and its credit would only be saved, if at all, from utter ruin in order that it might further subserve their selfish purposes.

I will mention one other reason for the passage of this law. If the gold and silver coin of the country is put in circulation it will be adding somewhat to the circulating medium now afloat. This at present is too restricted in certain portions of the Union, the South and the West, where the quantity is quite inadequate to the demands of business. The amount of circulating medium in a country ought never to be fixed by law. It should be left to be regulated by the requirements of trade. Money is the element upon which business floats, and without a sufficiency of which it is liable to perish. Good, hard money, or paper money, well secured, is never likely to become too abundant. The former being the accepted medium of exchange among all nations is as certain as the waters of the sea to find its level, and the quantity of the latter will always be governed by the character of the security. If secured by hard money, and equal to it in actual value, it is not more likely to

become too abundant. Let loose this gold from its hiding places, and you will hear less complaint about contraction. This coin will by degrees take the place of paper money, and before long you can spare from circulation the $4,000,000 of paper a month without trouble. But should that amount, or even a much less sum per month, be withdrawn, with no provision for supplying its place, the business of the country would soon be hard aground, and gen- | eral disaster would follow.

Since the Government has taken upon itself the task of furnishing the people a circulating medium it cannot decline the responsibility of providing so much and such sort of circulation as is demanded by the business wants of the people. These wants vary greatly from time to time, and depend upon many circumstances. They increase with population and wealth; they vary with the productiveness of the seasons; they are affected more or less by every summer's shower and chilling wind. It is not possible at any time to determine in advance what amount of circulation will be needed, and the legislator errs when he undertakes to prescribe a rule fixing one definite quantity for different times and different circumstances.

The bill before the Senate will relieve the country from the great embarrassment arising from time to time out of the present law fixing a definite limit upon the amount of circulation. It will unlock just so much gold and silver as may be needed in the current business of the country, and no more. I am sure it will improve the public credit and bring all Government secured paper up to near the common standard of value among all the nations. I believe the passage of the measure will work good, and only good, to the people and the country in every way.

Mr. TRUMBULL. I move that the Senate proceed to the consideration of executive busi

ness.

Mr. SHERMAN. I hope not.

Mr. TRUMBULL. It is half past four o'clock.

Mr. SHERMAN. I doubt whether there is a quorum here, and many Senators have gone away supposing the discussion would be continued till the recess.

Mr. TRUMBULL called for the yeas and nays, and they were ordered; and being taken, resulted-yeas 25, nays 15; as follows:

YEAS-Messrs. Buckalew, Cole, Davis, Doolittle, Drake, Ferry, Fessenden, Fowler, Frelinghuysen, Hendricks, Howard, McDonald, Morgan, Morrill of Vermont, Osborn, Patterson of New Hampshire, Patterson of Teunessec, Ramsey, Rice, Tipton, Trumbull, Van Winkle, Vickers, Welch, and Willey-25.

NAYS-Messrs. Cameron, Chandler, Conkling, Conness, Corbett, Morrill of Maine, Nye, Pomeroy, Ross, Sherman, Stewart, Sumner, Wade, Williams, and Wilson-15.

ABSENT-Messrs. Anthony, Bayard, Cattell, Cragin, Dixon, Edmunds, Grimes, Harlan, Henderson, Howe, McCreery, Morton, Norton,Saulsbury,Sprague, Thayer, Whyte, and Yates-18.

So the motion was agreed to; and after some time spent in executive session the doors were reopened, and the Senate took a recess till half past seven o'clock p. m.

EVENING SESSION.

The Senate resumed its session at half past seven o'clock p. m.

VALLEJO AND HUMBOLDT BAY RAILROAD. On motion of Mr. CONNESS, the Senate, as in Committee of the Whole, resumed the consideration of the bill (S. No. 349) granting aid in the construction of a railroad from the town of Vallejo to Humboldt bay, in the State of California, the pending question being on Public Lands as a substitute for the original bill.

Mr. HARLAN. I think there ought to be a provision added confining the grant to lands within fifteen miles.

Mr. CONNESS. I have no objection. Mr. HARLAN. I move this amendment, to come in at the end of the second section: Provided, That no land shall be granted under the

provisions of this act situated more than fifteen miles from the track of said road.

The amendment to the amendment was agreed to.

The amendment, as amended, was agreed to. The bill was reported to the Senate as amended, and the amendment was concurred in. The bill was ordered to be engrossed for a third reading, was read the third time, and passed. Its title was amended to read: A bill granting lands to the State of California to aid in the construction of a railroad and telegraph line from the town of Vallejo to Humboldt bay, in the State of California.

FREEDMEN'S BUREAU.

Mr. WILSON. I move to take up the bureau bill, which has been returned from the House of Representatives with amendments.

The motion was agreed to; and the Senate proceeded to consider the amendments of the House of Representatives to the bill (S. No. 567) relating to the Freedmen's Bureau and providing for its discontinuance.

The amendments were in line twenty-two, after the word "operations," to insertshall be," and after "discontinued" to strike out the words "as soon as the same may be done without injury to the Government."

Mr. WILSON. I move that the Senate concur in those amendments. The motion was agreed to.

MESSAGE FROM THE HOUSE.

A message from the House of Representatives, by Mr. MCPHERSON, its Clerk, announced that the House had disagreed to the amendments of the Senate to the amendment of the House to the bill (S. No. 352) to authorize the temporary supplying of vacancies in the Exec. utive Departments, asked a conference on the disagreeing votes of the two Houses thereon, and had appointed Mr. G. S. BOUTWELL of Massachusetts, Mr. JAMES F. WILSON of lowa, and Mr. S. S. MARSHALL of Illinois, managers at the same on its part.

BILL INTRODUCED.

Mr. CAMERON asked, and by unanimous consent obtained, leave to introduce a bill (S. No. 616) to remit the duties on a certain statue intended to surmount the soldiers' monument at Harrisburg, Pennsylvania; which was read twice by its title, and referred to the Committee on Finance.

MRS. L. T. POTTER.

Mr. HOWE. I move that the Senate proIceed to the consideration of the bill for the relief of Mrs. Potter.

The motion was agreed to; and the bill (S. No. 596) for the relief of Mrs. L. T. Potter was read the second time, and considered as in Committee of the Whole. It proposes to appropriate the sum of $20,000 to Mrs. L. T. Potter, of Charleston, in the State of South Carolina.

Mr. HARLAN. I would inquire of the Senator who has called.up this bill what is the nature of the claim?

Mr. HOWE. If the Clerk will read the report of the committee the Senator will see. The Chief Clerk proceeded to read the following report, made by Mr. HoWE:

The Committee on Claims, to whom was referred the petition of Mrs. Eliza K. Potter, submit the following as their report of the case:

The petitioner is the wife of L. T. Potter, of Charleston, South Carolina. She represents that at the opening of the war her husband was very wealthy, and that she possessed considerable means of her own. She further represents that throughout the war her husband and herself were devotedly attached to the cause of the Union, and that she herself and her son, a lad of some sixteen years, devoted nearly their whole time to the care and nursing of Federal prisoners in Charleston, and she represents that in the course of the war she expended of her own and her husband's money more than forty thousand dollars in ministering to the support and comfort of Union soldiers in rebel prisons. She represents that during the war her husband met with heavy losses; that some valuable mills situate near Charleston, and some docks and storehouses in Charleston, were burned; that her husband, from time to time during the war, sold portions of his property in Charleston and invested the proceeds in cotton, in the hope that when the war would close the cotton would be available; that some three hundred bales of cotton were