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THE UNITED STATES

SINCE THE CIVIL WAR


By

CHARLES RAMSDELL LINGLEY
Professor of History, Dartmouth College.


TO MY WIFE


1920.




PREFACE

To write an account of the history of the United States since the
Civil War without bias, without misstatements of fact and without the
omission of matters that ought to be included, would be to perform a
miracle. I have felt no wonder-working near me. I can claim only to
have attempted to overcome the natural limitations of having been
brought up in a particular region and with a traditional political,
economic and social philosophy. I have tried to present as many sides
of every question as the limitations of space permitted and to look
sympathetically upon every section, every party and every individual,
because the sympathetic critic seems to me most likely to discover the
truth.

It used to be believed that history could not be written until at
least half a century had elapsed after the events which were to be
chronicled. It is of course true that only after the lapse of time
can students gain access to ample documentary material, rid themselves
of partisan prejudice and attain the necessary perspective. Unhappily,
however, the citizen who takes part in public affairs or who votes in
a political campaign cannot wait for the labors of half a century. He
must judge on the basis of whatever facts he can find near at hand.
Next to a balanced intelligence, the greatest need of the citizen in
the performance of his political duties is a substantial knowledge
of the recent past of public problems. It is impossible to give a
sensible opinion upon the transportation problem, the relation between
government and industry, international relations, current politics, the
leaders in public affairs, and other peculiarly American interests
without some understanding of the United States since the Civil War. I
have tried in a small way to make some of this information conveniently
available without attempting to beguile myself or others into the
belief that I have written with the accuracy that will characterize
later work.

Some day somebody will delineate the _spiritual_ history of America
since the Civil War--the compound of tradition, discontent,
aspiration, idealism, materialism, selfishness, and hope that mark the
floundering progress of these United States through the last half
century. He will read widely, ponder deeply, and tune his spirit with
care to the task which he undertakes. I have not attempted this phase
of our history, yet I believe that no account is complete without it.

I have drawn heavily on others who have written in this field--Andrews,
Beard, Paxson and Peck, and especially on the volumes written for the
American Nation series by Professors Dunning, Sparks, Dewey, Latané
and Ogg. Haworth's _United States in Our Own Time, 1865-1920_, was
unfortunately printed too late to give me the benefit of the author's
well-known scholarship. Many friends have generously assisted me. My
colleagues, Professors F.A. Updyke, C.A. Phillips, G.R. Wicker, H.D.
Dozier, and Malcolm Keir have read the manuscript of individual
chapters. Professor E.E. Day of Harvard University gave me his counsel
on several economic topics. Professor George H. Haynes of the Worcester
Polytechnic Institute, Professor B.B. Kendrick of Columbia University,
Professor W.T. Root of the University of Wisconsin, and Professors L.B.
Richardson and F.M. Anderson of Dartmouth College have read the entire
manuscript. Officials at the Dartmouth College Library, the Columbia
University Library, and the Library of Congress gave me especial
facilities for work. Two college generations of students at Dartmouth
have suffered me to try out on them the arrangement of the chapters as
well as the contents of the text. Harper and Bros. allowed me to use a
map appearing in Ogg, _National Progress_, and D. Appleton and Co. have
permitted the use of maps appearing in Johnson and Van Metre,
_Principles of Railroad Transportation_; A.J. Nystrom and Co. and the
McKinley Publishing Co. have allowed me to draw new maps on outlines
copyrighted by them. At all points I have had the counsel of my wife
and of Professor Max Farrand of Yale University.

CHARLES R. LINGLEY.
Dartmouth College, June 14, 1920.




CONTENTS

CHAPTER

    I RECONSTRUCTION AND ITS AFTERMATH
   II IN PRESIDENT GRANT'S TIME
  III ECONOMIC FOUNDATIONS OF THE NEW ERA
   IV POLITICAL AND INTELLECTUAL BACKGROUND OF THE NEW ISSUES
    V THE NEW ISSUES
   VI THE ADMINISTRATION OF RUTHERFORD B. HAYES
  VII THE POLITICS OF THE EARLY EIGHTIES
 VIII THE OVERTURN OF 1884
   IX TRANSPORTATION AND ITS CONTROL
    X EXTREME REPUBLICANISM
   XI INDUSTRY AND _LAISSEZ FAIRE_
  XII DEMOCRATIC DEMORALIZATION
 XIII THE TREND OF DIPLOMACY
  XIV THE RISE OF THE WAGE EARNER
   XV MONETARY AND FINANCIAL PROBLEMS
  XVI 1896
 XVII REPUBLICAN DOMINATION AND WAR WITH SPAIN
XVIII IMPERIALISM
  XIX THE BEGINNING OF A NEW CENTURY
   XX THEODORE ROOSEVELT
  XXI POLITICS, 1908-1912
 XXII ECONOMIC AND POLITICAL TENDENCIES SINCE 1896
XXIII LATER INTERNATIONAL RELATIONS
 XXIV WOODROW WILSON
  XXV THE UNITED STATES AND THE WORLD WAR

INDEX




MAPS AND DIAGRAMS

The growth of the United States from 1776 to 1867

Popular vote in presidential elections, 1868 to 1896

Economic interests, 1890

Relative prices, 1865 to 1890

The New West

Railroad mileage, 1860 to 1910, in thousands of miles

Map of the United States showing railroads in 1870

Map of the United States showing railroads in 1890 (The maps showing
the railroads are from Johnson and Van Metre, Principles of Railroad
Transportation, by courtesy of the publishers, D. Appleton & Co.)

Financial operations, 1875 to 1897, in millions of dollars

Total silver coinage, 1878 to 1894, in millions of dollars

Net gold in the treasury, by months, January, 1893, to February,
1896, in millions of dollars

The presidential election of 1896

The Philippines

The Spanish-American War in the West Indies

Campaign about Santiago

The chief foreign elements in the population of the United States

The cost of food, 1900 to 1912

Morgan-Hill railroads as listed shortly after 1900

Daily newspaper circulation, 1918

Election of 1904 by counties

Caribbean interests of the United States

Election of 1916 by counties

The Western Front

Strength of the American Expeditionary Force, July 1, 1917, to
November 1, 1918

The United States--1920

The cost of food, January, 1913, to January, 1920




CHAPTER I


RECONSTRUCTION AND ITS AFTERMATH

Abraham Lincoln in the presidential chair was regarded by many of the
politicians of his party as an "unutterable calamity"; and while the
news of Lincoln's assassination was received with expressions of genuine
grief, the accession of Vice-President Andrew Johnson was looked upon as
a "Godsend to the country." As the Civil War came to a close, Lincoln
opposed severe punishments for the leaders of the Confederacy; he urged
respect for the rights of the southern people; he desired to recognize
the existence of a Union element in the South, to restore the states to
their usual relations with as little ill-feeling as possible, and in the
restoration process to interfere but little with the normal powers of
the states. Johnson, on the contrary, "breathed fire and hemp."
"Treason," he asserted over and again, "should be made odious, and
traitors must be punished and impoverished. Their great plantations must
be seized, and divided into small farms and sold to honest, industrious
men." For a time it seemed that the curtain would go down on the tragedy
of Civil War only to rise immediately on the execution of the
Confederate leaders and the confiscation of their property. A large and
active group of Washington politicians believed in the necessity of a
stern accounting with the "rebels." Lincoln's gentleness seemed to these
bitter northerners like a calamity; Johnson's vindictiveness like a
Godsend to the country. In the conflict between the policy of clemency
and the policy of severity is to be found the beginning of the period of
reconstruction.

Andrew Johnson was a compact, sturdy figure, his eyes black, his
complexion swarthy. In politics he had always been a Democrat. So
diverse were his characteristics that one is tempted to ascribe two
personalities to him. He was a tenacious man, possessed of a rude
intellectual force, a rough-and-ready stump speaker, intensely loyal,
industrious, sincere, self-reliant. His courage was put to the test
again and again, and nobody ever said that it failed. His loyalty held
him in the Union in 1861, although he was a senator from Tennessee and
his state as well as his southern colleagues were withdrawing. His
public and private integrity withstood a hostile investigation that
included the testimony of all strata of society, from cabinet officers
to felons in prison. Later, at the most critical moment of his whole
career, when he had hardly a friend on whom to lean, he was unflurried,
dignified, undismayed.

Although Johnson was born in North Carolina, the greater part of his
life was spent in eastern Tennessee. His education was of the slightest.
His wife taught him to write, and while he plied his tailor's trade she
read books to him that appealed to his eager intellect. When scarcely of
voting age he became mayor of the town in which he lived and by sheer
force of character made his way up into the state legislature, the
federal House of Representatives and the Senate. President Lincoln made
him military governor of Tennessee in 1862. In 1864 many Democrats and
most Republicans joined to form a Union party, and in order to emphasize
its non-sectional and non-partisan character they nominated Andrew
Johnson as Lincoln's running mate. And now this unschooled, poor-white,
slave-holding, Jeffersonian, states-rights Democrat had become President
of the United States.

It was scarcely to be expected that a man who had fought his way to the
fore in eastern Tennessee during those controversial years would possess
the characteristics of a diplomat. Even his friends found him
uncommunicative, too often defiant and violent in controversy,
irritating in manners, indiscreet, and lacking flexibility in the
management of men. The messages which he wrote as President were
dignified and judicious, and his addresses were not lacking in power,
but he was prone to indulge in unseemly repartee with his hearers when
speaking on the stump. He exchanged epithets with bystanders who were
all too ready to spur him on with their "Give it to 'em, Andy!" and
"Bully for you, Andy!" giving the presidency the "ill-savor of a corner
grocery" and filling his supporters with amazement and chagrin. The
North soon looked upon him as a vulgar boor and remembered that he had
been intoxicated when inaugurated as Vice-President. Unhappily, too, he
was distrustful by nature, giving his confidence reluctantly and with
reserve, so that he was almost without friends or spokesmen in either
house of Congress. His policies have commended themselves, on the whole,
even after the scrutiny of half a century. The extent to which he was
able to put them into effect is part of the history of reconstruction.

The close of the Civil War found the nation as well as the several
sections of the country facing a variety of complicated and pressing
social, economic and political problems. Vast armies had to be
demobilized and re-absorbed into the economic life of the nation.
Production of the material of war had to give way to the production of
machinery, the building of railroads and the tilling of the soil. The
South faced economic demoralization. The federal government had to
determine the basis on which the lately rebellious states should again
become normal units in the nation, and the civil, social and economic
status of the negro had to be readjusted in the light of the outcome of
the war. Most of these problems, moreover, had to be solved through
political agencies, such as party conventions and legislatures, with all
the limitations of partisanship that these terms convey. And they had
obviously to be solved through human beings possessed of all the
prejudices and passions that the war had aroused: through Andrew Johnson
with his force and tactlessness; through able, domineering and
vindictive Thaddeus Stevens; through narrow and idealistic Charles
Sumner and demagogic Benjamin F. Butler; as well as through finer
spirits like William Pitt Fessenden and Lyman Trumbull.

In their attitude toward the South, the people of the North, as well as
the politicians, fell into two groups. The smaller or radical party
desired a stern reckoning with all "rebels" and the imprisonment and
execution of the leaders.[1] They hoped, also, to effect an immediate
extension to the negroes of the right to vote. It was this faction that
welcomed the accession of Johnson to the Presidency. The other group was
much the larger and was inclined toward gentler measures and toward
leaving the question of suffrage largely for the future. Lincoln and his
Secretary of State, Seward, were representative of this party. The
attitude of the South toward the North was more difficult to determine.
To be sure the rebellious states were beaten, and recognized the fact.
There was general admission that slavery was at an end. But careful
observers differed as to whether the South accepted its defeat in good
faith and would treat the blacks justly, or whether it was sullen,
unrepentant and ready to adopt any measures short of actual slavery to
repress the negro.

In theory, the union of the states was still intact. The South had
attempted to secede and had failed. Practically, however, the southern
states were out of connection with the remainder of the nation and some
method must be found of reconstructing the broken federation. President
Lincoln had already outlined a plan in his proclamation of December 8,
1863. Excluding the leaders of the Confederacy, he offered pardon to all
others who had participated in the rebellion, if they would take an oath
of loyalty to the Union and agree to accept the laws and proclamations
concerning slavery. As soon as the number of citizens thus pardoned in
each state reached ten per cent. of the number of votes cast in that
state at the election of 1860, they might establish a government which
he would recognize. It was his expectation that a loyal body of
reconstructed voters would collect around this nucleus, so that in no
great while the entire South would be restored to normal relations. At
the same time he called attention to the fact that under the
Constitution the admission into Congress of senators and representatives
sent by these governments must rest exclusively with the houses of
Congress themselves. In pursuance of his policy he had already appointed
military governors in states where the federal army had secured a
foothold, and they directed the re-establishment of civil government.
The radicals opposed the plan because it left much power, including the
question of negro suffrage, in the hands of the states. A contest
between Congress and the executive was clearly imminent when the
assassin's bullet removed the patient and conciliatory Lincoln.

Lincoln's determination to leave control over their restoration as far
as possible in the hands of the states was in line with Johnson's
Democratic, states-rights theories. Moreover, the new executive retained
his predecessor's cabinet, including Seward, whose influence was
promptly thrown on the side of moderation. To the consternation of the
radicals the President issued a proclamation announcing a reconstruction
policy which substantially followed that of Lincoln. Like his
predecessor he intended to confine the voting power to the whites,
leaving to the states themselves the question whether the ballot should
be extended to any of the blacks. Wherever Lincoln had not already
acted, he appointed military governors who directed the establishment of
state governments, the revival of the functions of county and municipal
officials, the repeal of the acts of secession, the repudiation of the
war debts, and the election of new state legislatures, governors,
senators and representatives. The Thirteenth Amendment to the
Constitution, abolishing slavery, was ratified by the new legislatures
and declared in effect December 18, 1865.

During the last half of the year, the President's policy met with wide
approval among the people of the North, where both Republicans and
Democrats expressed satisfaction with his conciliatory attitude. The
South was not unpleased, as was indicated by the speed with which men
presented themselves for pardon and assisted in setting up new state
governments. Nevertheless there were disquieting possibilities of
dissension. Northern radicals could be counted upon to oppose so
moderate a policy. There was a reaction, too, against the great power
which the executive arm of the government had exercised in war time.
Congress felt that it had been thrust aside, its functions reduced and
its prestige diminished. It could be looked to for an assertion of its
desire to dominate reconstruction. Finally when ex-confederates began to
be elected to office, many a northerner shook his head and wondered
whether the South was attempting to get into the saddle once more.

When Congress convened in December, 1865, its members held a wide
variety of opinions in regard to the best method of restoring the
confederate states to the Union. On one point, however, there was some
agreement--that Congress ought to withhold approval of executive
reconstruction until it could decide upon a program of its own. Led by
Thaddeus Stevens, the radical leader of the House, a joint congressional
committee of fifteen was appointed to report whether any of the southern
state governments were entitled to representation in Congress. For the
present, all of them, even the President's own state, were to be denied
representation. With Stevens as chairman of the House Committee on
Reconstruction and Johnson in the President's chair, a battle was
inevitable, in which quarter would be neither asked nor given.

Unhappily for themselves, the southern states played unwittingly into
the hands of Stevens and his radical colleagues. The outcome of the war
had placed upon the freedmen responsibilities which they could not be
expected to carry. To many of them emancipation meant merely cessation
from work. Vagabondage was common. Rumor was widespread that the
government was going to give each negro forty acres of land and a mule,
and the blacks loafed about, awaiting the division. The strict
regulations which had surrounded the former slave were discarded and it
was necessary to accustom him to a new regime. "The race was free, but
without status, without leaders, without property, and without
education." Fully alive to the dangers of giving unrestricted freedom
to so large a body of ignorant negroes, the southern whites passed the
"black codes," which placed numerous limitations on the civil liberty
of "persons of color." In some cases they were forbidden to carry arms,
to act as witnesses in court except in cases involving their own race,
and to serve on juries or in the militia. Vagrancy laws enabled the
magistrates to set unemployed blacks at work under arrangements that
amounted almost to peonage. It is now evident that the South was
actuated by what it considered the necessities of its situation and
not merely by a spirit of defiance. Yet the fear on the part of the
North that slavery was being restored under a disguise was not
unnatural. Radical northern newspapers and leading extremists in Congress
exaggerated the importance of the codes until they seemed like a
systematic attempt to evade the results of the war. As Republican
leaders in Congress saw the satisfaction created in the South by the
President's policy, and discovered that northern Democrats were rallying
to his support, the jealousies of partisanship caused them still further
to increase their grip on the processes of reconstruction. A disquieting
by-product of the Thirteenth Amendment, abolishing slavery, also began
to appear. Hitherto only three-fifths of the negroes had been counted in
apportioning representation in the House of Representatives. As soon as
the slaves became free, however, they were counted as if they were
whites, and thereby the strength of the South in Congress would be
increased. It was hardly to be expected that the North would view such a
development with satisfaction.

The first action of the leaders in Congress was the introduction of a
bill to continue and extend the powers of the Freedmen's Bureau, a
federal organization which supervised charitable relief given the
negroes, protected them in making contracts for labor and assumed a sort
of guardianship over the race in making its transition out of slavery.
The new measure was intended to continue this federal tutelage of the
blacks. The President's veto of the bill, February 19, 1866, served to
widen the breach between him and Congress and thereby postponed still
further the admission of the representatives of the southern state
governments. Three days later Johnson addressed a crowd which collected
before the White House. In the course of his speech he lost control of
himself to such an extent as to indulge in undignified remarks and
personalities, and even to charge leaders in Congress with seeking to
destroy the fundamental principles of American government. Thoughtful
men everywhere were dismayed. In the meantime a Civil Rights bill was
pending in Congress, the purpose of which was to declare negroes to be
citizens of the United States and to give them rights equal to those
accorded other citizens, notwithstanding local or state laws and codes.
The President objected to the bill as an unconstitutional invasion of
the rights of the states, but it was promptly passed over the veto.
Scarcely any members of Congress now supported him except the Democrats.
The conservative or conciliatory Republicans were lost to him for good.
Throughout the North it was felt that protection must be accorded the
freedmen against the black codes, and when the President opposed it he
lost ground outside of Congress as well as in it. "From that time
Johnson was beaten."

Stevens in the House and Sumner and others in the Senate were now in a
position to press successfully a stern, congressional reconstruction
policy to replace that of the executive. The first item in the radical
program was the Fourteenth Amendment, which passed Congress in June,
1866, although it did not become of force until 1868. It contained four
sections: (1) making citizens of all persons born or naturalized in the
United States and forbidding states to abridge their rights; (2)
providing for the reduction of the representation in Congress of any
state that denied the vote to any citizens except those guilty of
crimes; (3) disabling confederate leaders from holding political office
except with the permission of Congress; and (4) prohibiting the payment
of confederate debts. The first section was, of course, designed to put
the civil rights of the negro into the Constitution where they would be
safe from hostile legislation. The second sought to get negro suffrage
into the South by indirection at a time when a positive suffrage
amendment could not be passed. The third was to take the pardoning
power out of executive hands.

At this point there came a halt in the controversy until the country
could be heard from in the congressional elections of 1866. Both sides
made unusual efforts to organize political sentiment. Both attempted to
demonstrate their thoroughly national character by holding conventions
attended by southern as well as northern delegates. Each angled for the
soldier vote by encouraging conferences of veterans. Late in July
occurred an incident which the radicals were able to use to advantage.
A crowd of negroes attending a convention in New Orleans in behalf of
suffrage for their race became engaged in a fight with white
anti-suffragists and many of the blacks were killed. The riot was
commonly referred to in the North as a "massacre," the moral of which
was that the negroes must be protected against the unrepentant rebels.
But it was Johnson himself who furnished greatest aid to his
adversaries. Having been invited to speak in Chicago, he determined
upon an electioneering trip, "swinging around the circle," he called
it. Again he was guilty of gross indiscretions. He made personal
allusions, held angry colloquies with the crowd and at one place met
such opposition that he had to retire unheard. It mattered little that
the greater part of his speeches were sound and substantial. His lapses
were held up to public scorn and he returned to Washington amid the
hoots of his enemies. It was commonly believed that he had been
intoxicated. Probably no orator, _The Nation_ sarcastically remarked,
ever accomplished so much by a fortnight's speaking. There could be
little doubt as to the outcome of the elections. The Republicans
carried almost every northern state and obtained a two-thirds majority
in each house of Congress, with which to override vetoes.

As if impelled by some perverse fate the southern whites during the fall
and winter of 1866-67 did the thing for which the bitterest enemy of the
South might have wished. Except in Tennessee, the legislature of every
confederate state refused with almost complete unanimity to ratify the
Fourteenth Amendment. Natural as the act was, it gave the North
apparently overwhelming proof that the former "rebels" were still
defiant. Encouraged by the results of the election and aroused by the
attitude of the South toward the Amendment, Congress proceeded to
encroach upon prerogatives that had hitherto been considered purely
executive, and also to pass a most extreme plan of reconstruction.

The first of these measures, the Tenure of Office Act, was passed over a
veto on March 2, 1867. By it the President was forbidden to remove civil
officers except with the consent of the Senate. Even the members of the
Cabinet could not be dismissed without the permission of the upper
house, a provision inserted for the protection of Edwin M. Stanton, the
Secretary of War. Stanton was in sympathy with the radical leaders in
Congress and it was essential to them that he be kept in this post of
advantage. General Grant, who had charge of the military establishment,
was made almost independent of the President by a law drafted secretly
by Stanton. On the same day, and over a veto also, was passed the
Reconstruction Act, the most important piece of legislation during the
decade after the war. It represented the desires of Thaddeus Stevens and
was passed mainly because of his masterful leadership. At the outset the
new Act declared the existing southern state governments to be illegal
and inadequate, and divided the South into five military districts. Over
each was to be a commanding general who should preserve order, and
continue civil officers and civil courts, or replace them with military
tribunals as he wished. Under his direction each state was to frame and
adopt a new constitution which must provide for negro suffrage. When
Congress should approve the constitution and when a legislature elected
under its provisions should adopt the Fourteenth Amendment, the state
might be readmitted to the Union.

The Reconstruction Act was remarkable in several features. The provision
imposing negro suffrage was carried through the Senate with difficulty
and only as the result of the tireless activity of Charles Sumner.
Sumner and other radicals were determined that the blacks should be
enfranchised in order that they might protect themselves from hostile
local legislation and also in order that they might form part of a
southern Republican party. Even more noteworthy was the military
character of the Act. The President had already exercised his
prerogative of declaring the country at peace on August 20, 1866, more
than six months before the Act was passed. In the decision in the
Milligan case, which preceded the Act by nearly three months, the
Supreme Court had decided that military tribunals were illegal except
where war made the operation of civil courts impossible. Military
reconstruction was illogical, not to say unlawful, therefore, but
Congress was more interested in a method that promised the speedy
accomplishment of its purposes than it was in the opinions of the
executive and judicial departments.

Despite his dissent from its provisions, the President at once set
military reconstruction in operation. When he mitigated its harshness,
however, where latitude was allowed him, Congress passed additional
acts, over the veto, of course, extending and defining the powers of
the commanding generals. Armed with complete authority, the generals
proceeded to remove many of the ordinary civil officers and to replace
them with their own appointees, to compel order by means of the
soldiery, to set aside court decrees and even to close the courts and
to enact legislation. In the meanwhile a total of 703,000 black and
627,000 white voters were registered, delegates to constitutional
conventions were elected, constitutions were drawn up and adopted which
permitted negro suffrage, and state officers and legislators elected.
In conformity with the provisions of the Act, the newly chosen
legislatures ratified the Fourteenth Amendment to the Constitution,
sent representatives and senators to Washington, where they were
admitted to Congress, and by 1871 the last confederate state was
reconstructed.

The commanding generals were honest and efficient, in the main, even if
their stern rule was distasteful to the South, but the regime of the
newly elected state officers and legislators was a period of dishonesty
and incapacity. Most of the experienced and influential whites had been
excluded from participation in politics through the operation of the
presidential proclamations and the reconstruction acts. In all the
legislatures there were large numbers of blacks--sometimes, indeed, they
were in the majority. Two parties appeared. The radical or Republican
group included the negroes, a few southern whites, commonly called
"scalawags," and various northerners known as "carpet-baggers." These
last were in some cases mere adventurers and in others men of ability
who were attracted to the South for one reason or another, and took
a prominent part in political affairs. The old-time whites held both
kinds in equal detestation. The other party was called conservative or
Democratic, and was composed of the great mass of the whites. Many of
them had been Whigs before the war, but in the face of negro-Republican
domination, nearly all threw in their lot with the conservatives.

Not all the activities of the legislatures were bad. Provisions were
made for education, for example, that were in line with the needs of
the states. Nevertheless, their conduct in the main was such as to
drive the South almost into revolt. In the South Carolina legislature
only twenty-two members out of 155 could read and write. The negroes
were in the majority and although they paid only $143 in taxes
altogether, they helped add $20,000,000 to the state debt in four
years. In Arkansas the running expenses of the state increased 1500
per cent.; in Louisiana the public debt mounted from $14,000,000 to
$48,000,000 between 1868 and 1871. Only ignorance and dishonesty could
explain such extravagance and waste. Submission, however, was not
merely advisable; it presented the only prospect of peace. Open
resentment was largely suppressed, but it was inevitable that the
whites should become hostile to the blacks, and that they should
dislike the Republican party for its ruthless imposition of a system
which governed them without their consent and which placed them at the
mercy of the incompetent and unscrupulous. A system which made a negro
the successor of Jefferson Davis in the United States Senate could
scarcely fail to throw the majority of southern whites into the ranks
of the enemies of the Republican organization.[2]

One step remained to ensure the continuance of negro suffrage--the
adoption of a constitutional provision. In 1869 Congress referred to the
states the Fifteenth Amendment, which was declared in force a year
later. By its terms the United States and the states are forbidden to
abridge the right of citizens to vote on account of race, color or
previous condition of servitude.

While radical reconstruction was being forced to its bitter conclusion,
the opponents of the President were maturing plans for his impeachment
and exclusion from office. By the terms of the Constitution, the chief
executive may be impeached for "Treason, Bribery, or other high Crimes
and Misdemeanors." Early in the struggle between President Johnson and
Congress a few members of the House of Representatives urged an attempt
to impeach him. Such extremists as James M. Ashley of Ohio, and Benjamin
F. Butler of Massachusetts, believed that he had even been implicated in
the plot to assassinate Lincoln. A thorough-going search through his
private as well as his public career failed to produce any evidence that
could be interpreted as sufficient to meet constitutional demands, and a
motion to impeach was voted down in the House by a large majority. So
indiscreet a man as the President, however, was likely at some time to
furnish a reason for further effort. The occasion came in the removal of
the Secretary of War, Edwin M. Stanton.

Stanton, although of a domineering and brusque personality, had ably
administered the War Department under Lincoln and Johnson. During the
controversy between the President and Congress, Stanton had remained in
the Cabinet but was closely in touch with his chief's opponents and
had even drafted one of the reconstruction acts. Johnson had tolerated
the questionable conduct of his Secretary, despite the advice of many
of his supporters, until August 5, 1867, when he requested Stanton's
resignation. The latter took refuge behind the Tenure of Office Act,
denying the right of the President to remove him, but yielding his
office at Johnson's insistence. This episode had occurred during a
recess of Congress and, in accord with the law, the removal of Stanton
was reported when it convened in December. The Senate at once refused
to concur and Stanton returned to his office. The President now found
himself forced, by what he regarded as an unconstitutional law, into
the unbearable position of including one of his enemies within his
official family, and once more he ordered the Secretary to retire. But
meanwhile the House of Representatives had been active and had on
February 24, 1868, impeached the President for "high crimes and
misdemeanors."

The trial was conducted before the Senate, as the Constitution
provides, the Chief Justice of the Supreme Court acting as the
presiding officer. The House chose a board of seven managers to conduct
the prosecution, of whom Thaddeus Stevens and Benjamin F. Butler were
best known. The President was defended by able counsel, including
former Attorney-General Stanbery, Benjamin R. Curtis, who had earlier
sat upon the Supreme Court, and William M. Evarts, an eminent lawyer
and leader of the bar in New York. The charges, although eleven in
number, centered about four accusations: (1) that the dismissal of
Secretary Stanton was contrary to the Tenure of Office Act; (2) that
the President had declared that part of a certain act of Congress was
unconstitutional; (3) that he had attempted to bring Congress into
disgrace in his speeches; and (4) that in general he had opposed the
execution of several acts of Congress. The President's counsel asked
for forty days in which to prepare their case. They were given ten,
although members of the House had been preparing for more than a year
to resort to impeachment. The trial lasted from early March to late
May.

As the trial wore on, it became increasingly evident that the House had
but little substance on which to base an impeachment, and that the force
back of it was intense hatred of the President. It was made clear to
senators who were inclined to waver towards the side of acquittal that
their political careers were at an end if they failed to vote guilty.
The general conference of the Methodist Episcopal Church even appointed
an hour of prayer that the Senate might be moved to convict. The lawyers
for the defense so far outgeneraled the prosecutors that one who reads
the records at the present day finds difficulty in thinking of them as
more than the account of a pitiful farce. At length on May 16 the Senate
was prepared to make its decision. The last charge was voted upon first.
It was a very general accusation, drawn up by Stevens, and seemed most
likely to secure the necessary two-thirds for conviction. Fifty-four
members would vote. Twelve of them were Democrats and were known to be
for acquittal. The majority of the Republicans were for conviction. A
small group had given no indication of their position, and their votes
would be the decisive ones. As the roll was called each senator replied
"Guilty" or "Not guilty," while floor and galleries counted off the vote
as the knitting women clicked off the day's toll of heads during the
days when the guillotine made a reign of terror in France. The result
was thirty-five votes for conviction and nineteen for acquittal. As
thirty-six were necessary, Johnson had escaped. A recess of ten days was
taken during which the prosecution sought some shred of evidence which
might prove that some one of the nineteen had accepted a bribe for his
vote, but to no avail. When the Senate convened again there was no
change in the vote on the second and third articles, and the attempt to
convict was abandoned.

For the first time in many months Johnson enjoyed a respite from the
attacks of his foes. Stanton relinquished his office, and the integrity
of the executive power was preserved. The race of the dictator of the
House had been run, for Stevens lived less than three months after the
trial.

The continuous controversies of the Johnson administration almost
completely pressed into the background two diplomatic accomplishments of
no little importance. The more dramatic of these related to the French
invasion of Mexico. During 1861, naval vessels of England, France and
Spain had entered Mexican ports in order to compel the payment of debts
said to be due those countries, but England and Spain had soon withdrawn
and had left France to proceed alone. French troops thereupon had
invaded the country, captured Mexico City and established an empire with
Archduke Maximilian of Austria as its head, despite the protests and
opposition of the Mexicans under their leader Juarez. The United States
had expressed dissent and alarm, meanwhile, but because of the war was
in no position to take action.

As soon as civil strife was finished, however, Johnson and Seward took
vigorous steps. An army under General Sheridan was sent to the border,
and diplomatic pressure was exerted to convince France of the
desirability of withdrawal. The occupation of Mexico was, apparently,
not popular in France, and in the face of American opposition the French
government sought a means of dropping the project. Accordingly the
invading forces were withdrawn early in 1867, leaving the hapless
Maximilian to the Mexicans, by whom he was subsequently seized and
executed.

While the Mexican difficulty was being brought to a successful outcome,
the government of Russia offered to sell to the United States her
immense Alaskan possessions west and northwest of Canada. Secretary
Seward was enthusiastically disposed to accept the offer and a treaty
was accordingly drawn up on March 30, 1867, providing for the
acquisition of the territory for $7,200,000. The Senate, however, was
far less inclined to seize the opportunity. Little was known about
Alaska, and the cost seemed almost prohibitive in view of the financial
strains caused by the war. Nevertheless the inclination to acquire
territory was strong and there was a widespread desire to accede to the
wishes of Russia who was understood to have been well-disposed toward
the United States during the war. Under the operation of these forces
the Senate changed its attitude and ratified the treaty on April 9,
1867. By this act the United States came into possession of an area
measuring nearly 600,000 square miles, and stores of fish, furs, timber,
coal and precious metals whose size is even yet little understood.

It was not long before it became apparent that radical reconstruction
had been founded too little upon the hard facts of social and political
conditions in the South, and too much upon benevolent but mistaken
theories, and upon prejudices, partisanship and emotion. It was
inevitable that there should be an aftermath.

At the close of reconstruction in 1871, the southern negro was a citizen
of civil and political importance. As a voter, he was on an equality
with the whites; he belonged to the Republican party and his party was a
powerful factor in the politics of the South; his position was secured,
or at least seemed to be secured, by amendments to the federal
Constitution. Legally and constitutionally his position appeared to be
impregnable. In the minds of the southern white, however, the amendments
vied with military reconstruction in their injustice and unwisdom. To
his mind they constituted an attempt to abolish the belief of the white
man in the essential inferiority of the black, to make the pyramid of
government stand on its apex, and to place the very issues of existence
within the power of the congenitally unfit. To the discontent aroused by
war were added political and racial antagonism, which blazed at times
into fury. The southern whites began to invent methods for overcoming
the power of the freedmen in politics and for insuring themselves
against possible danger of violence at the hands of the blacks.

The most famous device was the Ku Klux Klan or the Invisible Empire, a
somewhat loosely organized secret society which originated in Tennessee
during the turmoil immediately after the close of the war. In theory and
practice its operations were simple and effective. Its chief officials
were the Grand Wizard, the Grand Dragon, the Grand Titan. Local branches
were Dens, each headed by a Grand Cyclops. The Den worked usually at
night, when the members assembled clad in long white robes and white
masks or hoods, discussed cases which needed attention, and then rode
forth on horses whose bodies were covered and whose feet were muffled.
The exploits of the Klan expanded, in the exaggerated stories common
among the negroes, into the most amazing achievements. The members were
thought to be able to take themselves to pieces, drink entire pailfuls
of water, and devour "fried nigger meat." Usually the person about to be
"visited" received a notice that the dreaded Klan was upon him. He was
warned to cease his political activities or perhaps to leave the
neighborhood. If the threat proved ineffective, whipping or some worse
punishment was likely to follow.

In 1872 Congress unintentionally aided in the process of overcoming
negro domination by the passage of the Amnesty Act, which restored to
all but a few hundreds of the former Confederates the political
privileges which had been taken from them by the Fourteenth Amendment.
Under the latter the great majority of former southern leaders had been
deprived of the right to hold office. On the restoration of this right
such men as Alexander H. Stephens, former Vice-President of the
Confederate States, and Wade Hampton, one of the most influential South
Carolinians, could again take an active part in politics. With their
return, the cause of white supremacy received a powerful impetus.

In taking this step, however, Congress did not intend to allow the legal
and constitutional rights of the blacks to be waived without a contest.
Reports reached the North concerning the activities of the southern
whites--reports which in no way minimized the amount of intimidation and
violence involved--and in response to this information Congress passed
the enforcement laws of 1870-1871, generally known as the "Force
Acts."[3] These laws laid heavy penalties upon individuals who should
prevent citizens from exercising their constitutional political
powers--primarily the right to vote. As offences under these acts were
within the jurisdiction of the federal courts and as the federal
officials manifested an inclination to carry out the law, the number of
indictments was considerable. Convictions, however, were infrequent. The
famous Ku Klux Act of 1871 amplified the law of 1870 and was aimed at
combinations or conspiracies of persons who resorted to intimidation. It
authorized the President to suspend the privilege of the writ of _habeas
corpus_ and made it his duty to employ armed force to suppress
opposition.

Additional sting was given the enforcement laws by provision for the
superintendence of federal elections, under specified conditions, by
federal officials called "supervisors of election." The supervisors were
given large powers over the registration of voters and the casting and
counting of ballots, so as to ensure a fair vote and an honest count.
Since here, again, federal troops stood behind the law, it was manifest
that the central government would show some degree of determination in
its handling of the southern situation. Nevertheless, the result was
merely to delay the gradual elimination of the blacks from political
activity, not to prevent it. In practice the Republican state
governments in the South were continued in the seats of authority only
through the presence of the federal soldiery. In one way or another the
whites gained the upper hand, so that by 1877 only South Carolina and
Louisiana had failed to achieve self-government unhampered by federal
force.

In the meantime the enforcement acts were being slowly weakened by the
Supreme Court in several decisions bearing upon the Fourteenth
Amendment. The significant portion of Section I of the Amendment is as
follows:

    No State shall make or enforce any law which shall abridge
    the privileges or immunities of citizens of the United States;
    nor shall any State deprive any person of life, liberty, or
    property, without due process of law; nor deny to any person
    within its jurisdiction the equal protection of the laws.

In several cases involving the enforcement acts, the Court found
portions of the laws in conflict with the Constitution and finally, in
1883, the decision in United States _v._ Harris completed their
destruction. Here the court met a complaint that a group of white men
had taken some negroes away from the officers of the law and ill-treated
them. Such conduct seemed to be contrary to that part of the Ku Klux Act
which forbade combinations designed to deprive citizens of their legal
rights. The Court, however, called attention to the important words, "No
_State_ shall make or enforce," and was of opinion that the
constitutional power of Congress extends only to cases where _States_
have acted in such a manner as to deprive citizens of their rights. If
_individuals_, on the contrary, conspire to take away these rights,
relief must be sought at the hands of the state government. As the great
purpose of the Ku Klux Act had been to combat precisely such individual
combinations, it appeared that the Court had, at a blow, demolished the
law. Not long afterwards the Court declared unconstitutional the Civil
Rights Act of 1875, which had been designed to insure equal rights to
negroes in hotels, conveyances and theatres. Here again the Court was of
opinion that the Fourteenth Amendment grants no power to the United
States but forbids certain activities by the states.[4]

Stuffing the ballot box was common in South Carolina and other states.
In one election in this state the number of votes cast was almost double
the number the names on the polling list. In some places the imposition
of a poll tax peacefully eliminated the impecunious freedman. In
Mississippi the state legislature laid out the "shoestring" election
district, 300 miles long and about 20 miles wide, which included many of
the sections where the negroes were most numerous, in order that their
votes might have as little effect as possible. By hook or by crook,
then, in simple and devious ways, the dangers of negro domination were
averted. Nevertheless the provisions of the law for federal supervision
of elections remained, becoming a bone of contention during a later
administration.

About 1890 there began a new era in the elimination of the negro from
politics in the South. The people of that section disliked the methods
which they felt the necessity of using, and searched about for a less
crude device. Furthermore the rise of a new political movement in some
parts of the South in the late eighties and early nineties was making
divisions among the Democrats and was encouraging attempts by the two
factions to control the negro vote. Suddenly, a relatively small number
of negro voters became a powerful and purchasable make-weight. Both
sides, perhaps, were a bit disturbed at this development. At any rate,
additional impetus was given to the movement for the suppression of the
negro. Eventually plans were originated, some of which were clearly
constitutional and all of which carried a certain appearance of
legality.

The first steps were taken by Mississippi in 1890. The new state
constitution of that year required as prerequisite to the voting
privilege, the payment of all taxes which were legally demanded of the
citizen during the two preceding years--a provision to which no
constitutional exception could be taken, and which effectively debarred
large numbers of colored voters. Further, it provided that after January
1, 1892, every voter must be able to read any section of the state
constitution or be able to give an interpretation of it _when read to
him_. As the election officials who would judge the ability of the
applicant properly to interpret the constitution would certainly be
whites, it was clear that the ignorant black would have scant chance of
passing the educational test. Several other states followed in the wake
of Mississippi, until in 1898 Louisiana discovered a new barrier through
which only whites might make their way to the voting lists. This was the
famous "grandfather clause." In brief, it allowed citizens to vote who
had that right before January 1, 1867, together with the descendants of
such citizens, regardless of their educational and property
qualifications. As no negroes had voted in the state before that date,
they were effectively debarred. Under the influence of such pressure,
the negro vote promptly dwindled away to negligible proportions. In
Louisiana, to cite one case, there were 127,263 registered colored
voters in 1896, and 5,354 in 1900. Between these two years the new state
constitution had been passed. In 1915 the Supreme Court finally declared
a grandfather clause unconstitutional on the ground that its only
possible intention was to evade that provision of the Fifteenth
Amendment which forbids the states to abridge, on account of color, the
rights of citizens of the United States to vote.

The history of the effects of the war and of reconstruction on the
political status of the negro has been concisely summarized as falling
into three periods. At the close of the war: (1) the negroes were
more powerful in politics than their numbers, intelligence and
property seemed to justify; (2) the Republican party was a power in
the South; and (3) the negroes enjoyed political rights on a legal and
constitutional equality with the whites. By 1877 the first of these
generalizations was no longer a fact; by 1890 the Republican party had
ceased to be of importance in the South; and by the opening of the
twentieth century, the negro as a possible voter was not on a legal
and constitutional equality with the white.

In the sphere of government the war and reconstruction were of lasting
importance. Preeminently it was definitely established that the federal
government is supreme over the states. Although the Constitution had
seemed to many to establish that supremacy in no uncertain terms, it can
not be doubted that only as a result of the war and reconstruction did
the theory receive a degree of popular assent that approached unanimity.
Temporarily, at least, reconstruction added greatly to the prestige and
self-confidence of Congress. During the war the powers of the President
had necessarily expanded. The reaction, although hastened by the
character and disposition of President Johnson, was inevitable. The
depression of the executive elevated the legislature and not until the
beginning of the twentieth century did the scales swing back again
toward their former position.


BIBLIOGRAPHICAL NOTE

General. The best general account of the period 1865-1917 is to be found
in the following volumes of _The American Nation: A History_: W.A.
Dunning, _Reconstruction Political and Economic, 1865-1877_ (1907); E.E.
Sparks, _National Development, 1877-1885_ (1907); D.R. Dewey, _National
Problems, 1885-1897_ (1907); J.H. Latané, _America as a World Power,
1897-1907_ (1907); F.A. Ogg, _National Progress, 1907-1917_ (1918). The
volumes vary in excellence and interest, but set a high standard,
especially in their recognition of the importance of economic facts, and
contain excellent bibliographical material. The following single volumes
are useful: E.B. Andrews, _United States in Our Own Time, 1870-1903_
(1903); C.A. Beard, _Contemporary American History_ (1914); P.L.
Haworth, _Reconstruction and Union, 1865-1912_ (1912); P.L. Haworth,
_United States in Our Own Time, 1865-1920_; E.P. Oberholtzer, _History
of the United States since the Civil War_ (to be in several volumes, of
which one appeared in 1917, covering 1865-1868); F.L. Paxson, _The New
Nation_ (1915); H.T. Peck, _Twenty Years of the Republic, 1885-1905_
(1907), readable and especially valuable in its interpretation of the
period which it covers; J.F. Rhodes, _History of the United States from
Hayes to McKinley, 1877-1896_ (1919), lacks understanding of the period
covered. J.S. Bassett, _Short History of the United States_ (1913),
has excellent chapters on the years 1865-1912; F.J. Turner in the
_Encyclopaedia Britannica_ (11th ed.), article "United States, History
1865-1910," is brief but inclusive; the later chapters of Max Farrand,
_Development of the United States_ (1918), present a new point of view.
_The Chronicles of America Series_ (1919 and later), edited by Allen
Johnson, contains valuable volumes on especial topics. For party
platforms and election statistics consult Edward Stanwood, _A History
of the Presidency_ (2 vols., 2nd ed., 1916).

Reconstruction. The most valuable single volume on the reconstruction
period is the volume by Dunning already referred to; W.L. Fleming,
_Sequel of Appomattox_ (1919), is also excellent; J.F. Rhodes, _History
of the United States since the Compromise of 1850_, vols. VI, VII
(1906), is the best detailed account; James Schouler, _History of the
United States_, vol. VII (1913), presents a new view of President
Johnson. Valuable biographies are J.A. Woodburn, _The Life of Thaddeus
Stevens_ (1913); G.H. Haynes, _Charles Sumner_ (1909); Horace White,
_The Life of Lyman Trumbull_ (1913). On impeachment, D.W. Dewitt, _The
Impeachment and Trial of Andrew Johnson_ (1903), is best. W.A. Dunning,
_Essays on Civil War and Reconstruction_ (ed. 1910), is strong on the
constitutional changes. Studies on reconstruction in the several states
have been published by W.W. Davis (Florida), (1913); W.L. Fleming
(Alabama), (1905); J.W. Garner (Mississippi), (1901); J.G. deR.
Hamilton (North Carolina), (1914); C.W. Ramsdell (Texas), (1910); and
others. For documentary material, W.L. Fleming, _Documentary History of
Reconstruction_ (2 vols., 1906-7), is essential. Edward Channing, A.B.
Hart and F.J. Turner, _Guide to the Study and Reading of American
History_ (1912), provides full references to a wide variety of works
covering 1865-1911. Consult also Appleton's _Annual Cyclopaedia_,
_1861-1902_. On foreign relations J.B. Moore, _Digest of International
Law_, 8 vols., (1906).

Periodical literature. The most useful periodicals are:

_American Economic Review_ (1911-); _American Historical Review_
(1895-); _American Political Science Review_ (1907-); _Atlantic
Monthly_ (1857-); _Century Magazine_ (1870-); _Harper's Weekly_
(1857-1916); _Harvard Law Review_; _History Teachers' Magazine_,
continued as _Historical Outlook_ (1909-); _Journal of Political
Economy_ (1892-); _Nation_ (1865-); _North American Review_ (1815-);
_Political Science Quarterly_ (1886-); _Quarterly Journal of Economics_
(1886-); _Scribner's Magazine_ (1887-); _Yale Review_ (1892-1911, _new
series_, 1912-).

       *       *       *       *       *

[1] Jefferson Davis, the President of the Confederate States, was held
in prison until 1867 and then released. He died in 1889. Suggestions
that General Lee, the most prominent military leader, be arrested and
tried met with such opposition from General Grant, the Union leader,
that the project was dropped. Lee died in 1870.

[2] A number of these states later repudiated their debts.

[3] The threats used to keep the negroes away from the polls are
typified in the following, which was published in Mississippi:

    "The Terry Terribles will be here Monday to see there is a fair
    election."

    "The Byram Bulldozers will be here Monday to see there is a fair
    election.

    "The Edwards Dragoons will be here Monday to see there is a fair
    election.

    "Who cares if the McGill men don't like it?

    "The whole State of Mississippi is interested in the election.

    "It _shall_ be a Democratic victory."

[4] In regard to segregation of the races in railroad coaches, the
Court decided, 1910, that constitutional rights are not interfered with
when separate accommodations are provided, if the accommodations be
equally good. Chiles _v._ Chesapeake and Ohio Railroad Co., 218 U.S.,
71.




CHAPTER II


IN PRESIDENT GRANT'S TIME

Aside from President Lincoln, the most prominent personality on the
northern side during the latter part of the Civil War was General
Ulysses S. Grant. His successes in the Mississippi Valley in the
early days of the war, when success was none too common, his capture
of Vicksburg at the turning point of the conflict, and his dogged
drive toward Richmond had established his military reputation. When
the drive toward Richmond resulted at last in the capture of Lee's
army and its surrender at Appomattox, the victorious North turned
with gratitude to Grant and made him a popular idol, while the
politicians began to question whether his popularity might not be put
to account in the field of politics.

Grant himself had never paid any attention to matters of government.
In only one presidential election had he so much as voted for a
candidate, and then it was for a Democrat, James Buchanan. In 1860 he
was prevented from voting for Senator Stephen A. Douglas and against
Abraham Lincoln only by the fact that he had not fulfilled the
residence requirement for suffrage in the town where he was living.
Nevertheless in his capacity as general of the army his headquarters
after the war were in Washington and his duties brought him into
contact with the politicians and eventually entangled him in the
controversy between the President and Congress. Circumstances at
first threw him into close association with Johnson, but at the time
of the Stanton episode late in 1867 a misunderstanding arose between
them which developed into a question of veracity, and then into open
hostility. The opponents of the President took up the General's case
with alacrity and from then on the popular hero was looked upon as
the inevitable choice for the next Republican nomination.

The convention of the National Union Republican Party, as it was
called at that time, was held in Chicago, May 20, 1868, during the
interval between the votes on the eleventh and second charges of the
impeachment of President Johnson. General Grant was unanimously
nominated for the presidency and Schuyler Colfax, Speaker of the
House of Representatives, for the second place on the ticket. The
platform portrayed the benefits of radical reconstruction and
defended negro suffrage in the South. In the North at that time the
black was commonly denied the vote--the Fifteenth Amendment having
not yet been ratified--and the convention accordingly declared that
the question of suffrage in all the "loyal" states properly belonged
in the states themselves. Other planks asserted that the public debt
ought to be paid in full, that pensions for the veterans were an
obligation and that immigration ought to be encouraged. The
administration of President Johnson was denounced and the thirty-five
senators who voted for his conviction in the impeachment trial were
commended.

The Democrats met at Tammany Hall in New York on July 4. Their
platform approved the pension laws, advocated the sale of public land
to actual occupants, praised the administration of President Johnson,
arraigned the radicals and declared the reconstruction acts
"unconstitutional, revolutionary, and void." If the radical party
should win in the election, the Democrats asserted, the result would
be "a subjected and conquered people, amid the ruins of liberty and
the scattered fragments of the Constitution." The regulation of the
suffrage, one plank declared, had always been in the hands of the
individual states. The most prominent place in the platform, however,
was given to the question of the public debt. Part of the bonds
issued during the war had, by acts of Congress, been made payable
in "dollars," a word which might mean either paper dollars or gold
dollars. Paper, however, was much less valuable than gold, times were
hard, and many people held the opinion that the debt could properly
be paid in paper. Such was the "Ohio idea," which was made part of
the Democratic platform.

The choice of a candidate required twenty-two ballots. Early trials
indicated the strength of George H. Pendleton, popularly known as
"Gentleman George" and the chief exponent of the "Ohio idea." Johnson
also had support. Chief Justice Salmon P. Chase, having failed to
obtain the Republican nomination, allowed it to be known that he was
willing to become the Democratic candidate. At length, on the
twenty-second ballot, a few votes were cast for Governor Horatio
Seymour of New York, the chairman of the convention. The move met
with enthusiastic approval, despite Seymour's insistence that he
would not be a candidate, and he was unanimously chosen.

[Illustration:
Popular vote in presidential elections, 1868-1896]

The developments of the campaign depended largely upon occurrences in
the South. Military reconstruction had not been wholly completed in
Virginia, Mississippi, Texas and Georgia. The last of these states
had once been readmitted to the Union, but had immediately expelled
the negro members of its legislature, and was thereupon placed again
under military rule. The Ku Klux Klan was meanwhile in general
operation throughout the South and its activities, both real and
imaginary, received wide advertisement in the North. Public interest,
therefore, in the underlying issues of the campaign centered upon the
attitude of the candidates toward the southern question. General
Grant was understood to be with the radicals and Seymour with the
conservatives. The result of the election was the choice of the
Republican leader by an apparently large majority. He carried
twenty-six out of thirty-four states, with 214 out of 294 electoral
votes, but he received a popular majority of only 300,000. Examination
of the returns indicated a strong conservative minority in many of the
solid Republican states. The strength of the radicals in the South,
moreover, was due, in the main, to negro-carpetbag domination, and when
these states should become conservative, as they were sure to do, the
political parties would be almost evenly divided.[1]

The man who was now entering upon his first experience as the holder
of an elective office had risen from obscurity to public favor in the
space of a few years. Although a graduate of West Point, with eleven
years of military experience afterward, his career before 1861 had
been hardly more than a failure. He had left the army in 1854 rather
than stand trial on a charge of drunkenness; had grubbed a scanty
living out of "Hard Scrabble," a farm in Missouri; had tried his hand
at real estate, acted as clerk in a custom-house and worked in a
leather store at $800 a year. Then came the war, and in less than
three years Grant had received the title of Lieutenant-General, which
only Washington had borne before him, and had become General-in-Chief
of all the armies of the United States. Always an uncommunicative
man, he kept his own counsel during the interval between his election
and his inauguration. He saw few politicians, asked no advice about
his cabinet, sought no assistance in preparing his inaugural address
and made no suggestions to the leaders of his party concerning
legislation that he would like to see passed. His first act, the
appointment of his cabinet, caused a gasp of surprise and dismay.
Most of the men named were but little known and some of them were not
aware that they were being chosen until the list was made public. The
Secretary of State, Elihu Washburne, was a close personal friend, and
was appointed merely that he might hold the position long enough to
enjoy the title and then retire. He was succeeded by Hamilton Fish,
of New York, who proved to be a wise choice. The Secretary of the
Treasury was A.T. Stewart, a rich merchant of New York, but he had to
withdraw on account of a law forbidding any person "interested in
carrying on the business of trade or commerce" to hold the office.
The Secretary of the Navy, A.E. Borie, was a rich invalid of
Philadelphia, who had almost no qualifications for his office and
resigned at once. Better appointments were former Governor J.D. Cox,
of Ohio, as Secretary of the Interior, and Judge E.R. Hoar, of
Massachusetts, as Attorney-General.

When the Congress elected with Grant assembled in 1869 its first act
was a measure providing for the payment of the public debt in coin.
Part of the Tenure of Office Act was repealed, the President having
indicated his opposition to it. On the southern question General
Grant had earlier inclined toward moderation, but radical counsels
and the logic of events led him to join Congress in the passage of
the enforcement act and the Ku Klux Act, both of which have already
been mentioned.

It was during this, the first year of Grant's administration, that
there occurred the famous gold conspiracy of 1869. Jay Gould and
James Fisk, Jr., two of the most unscrupulous stock gamblers of the
time, determined to corner the supply of gold and then run its market
price up to a high level, in order to further certain interests which
they had recently purchased. The likelihood that the conspirators
could carry out the plan depended largely on the Secretary of the
Treasury, George S. Boutwell, who was accustomed to sell several
millions of dollars' worth of gold each month. If the sales could be
stopped Gould and Fisk might be successful. Accordingly, they got on
friendly terms with the President through cultivating the acquaintance
of his brother-in-law, were seen publicly with him at the theatre and
other places, and subsequently he wrote to the Secretary expressing
his opinion that the sales had better stop. Gould apparently was
informed of this decision by the brother-in-law, even before the
message reached the Secretary, and immediately bought up so much gold
as to run the price to an unparalleled figure. This was on "Black
Friday," September 24. The Secretary became alarmed, rumors were abroad
that the administration was implicated in the conspiracy, and at noon,
after consultation with the President, he decided to place four
millions in gold on the market. At once the price dropped, brokers went
bankrupt, and Gould and Fisk had to take refuge behind armed guards to
save their lives. The President had not been a party to the plans of
the speculators, but his blindness to their real purposes and his
association with them during the period when their scheme was being
perfected made him a target for all manner of accusations.

Further astonishment was caused by the attitude of the President toward
two of the three really able men in his cabinet. In June, 1870, he
suddenly called for the resignation of Judge Hoar. It appeared that he
was seeking votes in the Senate for a treaty in which he was interested
and that certain southern members demanded the post of attorney-general
for a southern man in return for their support. Secretary Cox's
resignation came soon afterward. He had taken his department out of
politics, had furthered the cause of civil service reform and had
protected his employees from political party assessments. These acts
brought him into collision with the politicians, who had the ear of the
President, and Cox had to retire. Both Hoar and Cox were succeeded by
mediocre men.

The treaty which caused the removal of Secretary Hoar was one that the
President had arranged providing for the annexation of San Domingo. The
Senate was opposed to ratification, but General Grant was accustomed
to overcoming difficulties and he urged his case with all the power at
his command. One result was an unseemly wrangle between the President
and Senator Charles Sumner over the latter's refusal to support
ratification. General Grant, in resentment, procured the withdrawal
of the Senator's friend, John Lothrop Motley from England, whither he
had been sent as minister, and later the exclusion of Sumner from the
chairmanship of the Committee on Foreign Relations, a post in which he
had displayed great ability for ten years. Eventually the President had
to give way on San Domingo, as the Senate did not agree with him in his
estimate of its probable value.

In its conduct of our relations with England, on the other hand, the
administration met with success and received popular approval. Ever
since the war the people of the North had desired an opportunity to
make Great Britain suffer for her attitude during that struggle.
Senator Sumner struck a popular chord when he suggested that England
should pay heavy damages on the ground that her encouragement of the
South had prolonged the war. Specifically, however, the United States
demanded reparation for destruction committed by the _Alabama_ and
other vessels that had been built in English ports. In 1870 Europe
was in a state of apprehension on account of the Franco-Prussian War,
and Secretary Fish seized the opportunity to press our claims upon
England. The latter, meanwhile, had abated somewhat her earlier
attitude of unwillingness to arbitrate, and Fish placed little
emphasis on Senator Sumner's suggestions of a claim for indirect
damages. The Treaty of Washington, signed and ratified in May, 1871,
provided for the arbitration of the _Alabama_ claims under such rules
that a decision favorable to the American side of the case was made
exceedingly probable. Each of five governments appointed a
representative--the United States, Great Britain, Italy, Switzerland
and Brazil. The meeting took place in Geneva and resulted favorably
to the American demands. England was declared to have failed to
preserve the proper attitude for a neutral during the war and was
ordered in 1872 to make compensation in the amount of $15,500,000.

The United States had need of any feeling of national pride that
might come as the result of the Geneva award, to offset the shame of
domestic revelations, for one of the characteristics of the decade
after the war was the wide-spread corruption in political and
commercial life. One of the most flagrant examples was the Tweed Ring
in New York. The government of that city was in the hands of a band
of highwaymen, of whom William M. Tweed, the leader of Tammany Hall,
was chief. Through the purchase of votes and the skilful distribution
of the proceeds of their control, they managed to keep in power
despite a growing suspicion that something was wrong. A favorite
method of defrauding the city was to raise an account. One who had a
bill against the city for $5,000 would be asked to present one for
$55,000. When he did so, he would receive his $5,000 and the
remainder would be divided among the members of the Ring. The
plasterer, for example, who worked on the County Court House
presented bills for nearly $3,000,000 in nine months. The New York
_Times_ and the cartoons of Thomas Nast in _Harper's Weekly_ were the
chief agents in arousing the people of the city to their situation.
The former obtained and published proofs of the rascality of the
Ring, mass meetings were held and an election in November, 1871,
overturned Tweed and his associates. Some of them fled from the
country, while Tweed himself died in jail.

More important both because of its effect on national politics and
because of its influence on railway legislation for many years
afterward was the Credit Mobilier scandal. The Credit Mobilier was a
construction company composed of a selected group of stockholders of
the Union Pacific Railroad, the transcontinental line which was being
built between 1865 and 1869. In their capacity of railroad
stockholders they awarded themselves as stockholders of the
construction company the contract to build and equip a large part of
the railway. The terms which they gave themselves were so generous as
to insure a handsome profit. Chief among the members of the Credit
Mobilier was Oakes Ames, a member of Congress from Massachusetts.
Late in 1867 Ames became fearful of railroad legislation that was
being introduced in Washington and he therefore decided to take steps
to protect the enterprise. He was given 343 shares of Credit Mobilier
stock, which he placed among members of Congress where, as he said,
they would "do most good." Rumors concerning the nature of the
transaction resulted finally in accusations in the New York _Sun_
during 1872, which involved the names of many prominent politicians.
Congressional committees were at once appointed to investigate the
charges, and their reports caused genuine sensations. Ames was found
guilty of selling stock at lower than face value in order to
influence votes in Congress and was censured by the House of
Representatives. The Vice-President, Schuyler Colfax, and several
others were so entangled in the affair as to lose their reputations
and retire from public life for good. Still others such as James A.
Garfield were suspected of complicity and were placed for many years
on the defensive.

Fear was wide-spread that political life in Washington was riddled
with corruption. Corporations which were large and wealthy for that
day were already getting a controlling grip on the legislatures of
the states, and if the Credit Mobilier scandal were typical, had
begun to reach out to Congress. Had the charges been made a little
earlier they might have influenced the election of 1872, which turned
largely on certain omissions and failings of the administration, and
especially of General Grant himself.

There is something intensely pathetic in General Grant as President
of the United States--this short, slouchy, taciturn, unostentatious
man who was more at ease with men who talked horses than with men who
talked government or literature; this President who was unacquainted
with either the theory or the practice of politics, who consulted
nobody in choosing his cabinet or writing his inaugural address, who
had scarcely visited a state capital except to capture it and had
been elected to the executive chair in times that were to try men's
souls. An indolent man, he called himself, but the world knew that he
was tireless and irresistible on the field when necessity demanded,
persistent, imperturbable, simple and direct in his language, and
upright in his character. The tragedy of President Grant's career was
his choice of friends and advisors. In Congress he followed the
counsels of second-rate men who gave him second-rate advice; outside
he associated too frequently with questionable characters who
cleverly used him as a mask for schemes that were an insult to his
integrity, but which his lack of experience and his utter inability
to judge character kept hidden from his view. Honorable himself and
loyal to a fault to his friends, he believed in the honesty of men
who betrayed him, long after the rest of the world had discovered
what they were. He could accept costly gifts from admirers and
appoint these same men to offices, without dreaming that their
generosity had sprung from any motive except gratitude for his
services during the war.[2]

It was inevitable, in view of these facts, that the presidential
campaign of 1872 should be essentially an anti-Grant movement, but
its particular characteristics had their origin before the General's
first election. In 1865 a constitutional convention in Missouri had
deprived southern sympathizers of the right to vote and hold office.
A wing of the Republican party, led by Colonel B. Gratz Brown, had
begun a counter-movement, intended to remove the restrictions on the
southerners, and also to reform other abuses in the state. Colonel
Brown had early received the assistance of General Carl Schurz, a man
of ability with the temperament of a reformer. The Brown-Schurz
faction had quickly increased in numbers, had become known as the
Liberal Republican party and had attracted such interest throughout
the country that a national conference was called for May, 1872, at
Cincinnati. In adopting a conciliatory southern policy, the Liberal
Republicans became opposed to the President, who had by this time
become thoroughly committed to the radical program. Other critics of
the administration, mainly Republicans, became interested in the
Liberal revolt--those who deprecated the President's choice of
associates and advisors, the civil service reformers who were aroused
by the dismissal of Secretaries Hoar and Cox, and the tariff
reformers who had vainly attempted to arouse enthusiasm for their
plans.

On account of the varied character of the elements which composed it
and the independent spirit of its members, the Cincinnati assembly
resembled a mass meeting rather than a well-organized political
conference. It numbered among its members, nevertheless, many men of
influence and repute. Some of the most powerful newspaper editors of
the country, also, were friendly to its purpose, so that it seemed
likely to be a decisive factor in the coming campaign. In most
respects the platform reflected the anti-Grant character of the
convention. It condemned the administration for keeping unworthy men
in power, favored the removal of all disabilities imposed on
southerners because of the rebellion, objected to interference by the
federal government in local affairs--a reference to the use of troops
to enforce the radical reconstruction policy--and advocated civil
service reform. The convention found difficulty in stating its
attitude toward the tariff question. It was deemed necessary to get
the support of Horace Greeley, the editor of the New York _Tribune_,
the most powerful northern newspaper of Civil War times, but Greeley
was an avowed protectionist. The platform, therefore, evaded the
issue by referring it to the people in their congressional districts,
and to Congress. But the rock on which the movement met shipwreck was
the nomination of a candidate. Many able men were available--Charles
Francis Adams, who had been minister to England, Senator Lyman
Trumbull, B. Gratz Brown and Judge David Davis of the Supreme Court.
Any one of them would have made a strong candidate. The convention,
however, passed over all of them and nominated Greeley, long known as
being against tariff reform, against civil service reform and hostile
to the Democrats, whose support must be obtained in order to achieve
success. Although a journalist of great influence and capacity,
Greeley was an erratic individual, whose appearance and manner were
the joy of the cartoonist.

The Republican convention met on June 5, and unanimously re-nominated
Grant. The platform recited the achievements of the party since 1861,
urged the reform of the civil service, advocated import duties and
approved of the enforcement acts and amnesty.

To the Democrats the greatest likelihood of success seemed to lie in
the adoption of the Liberal Republican nominee and platform. Such a
course, to be sure, would commit them to a candidate who had
excoriated their party for years in his newspaper, and to the three
war amendments to the Constitution, which the Liberal Republicans had
accepted. Yet it promised the South relief from military enforcement
of obnoxious laws, and that was worth much. Both Greeley and his
platform were accordingly accepted.

The enthusiasm for the Liberal movement which was observable at the
opening of the campaign rapidly dwindled as the significance of the
nomination became more clear. Greeley was open to attack from too
many quarters. The cartoons of Nast in _Harper's Weekly_, especially,
held him up to merciless ridicule. In the end he was defeated by
750,000 votes in a total of six and a half million, a disaster which,
together with the death of his wife and the overwork of the campaign
resulted in his death shortly after the election. As for the
Republicans they elected not only their candidate but also a
sufficient majority in Congress to carry out any program that the
party might desire.

On March 3, 1873, as Grant's first term was drawing to a close,
Congress passed a measure increasing the salary of public officials
from the President to the members of the House of Representatives.
The increase for Congressmen was made retroactive, so that each of
them would receive $5,000 for the two years just past. To a country
whose fears and suspicions had been aroused by the Credit Mobilier
scandal, the "salary grab" and the "back pay steal" were fresh
indications that corruption was entrenched in Washington. Senators
and Representatives began at once to hear from their constituencies.
Many of them returned the increase to the treasury and when the next
session opened, the law was repealed except so far as it applied to
the president and the justices of the Supreme Court.

The congressional elections of 1874 indicated the extent of the
popular distrust of the administration. In New York, where Samuel J.
Tilden was chosen governor, and in such Republican strongholds as
Massachusetts and Pennsylvania the Democrats were successful. In the
House of Representatives the Republican two-thirds majority was wiped
out and the Democrats given complete control. Even the redoubtable
Benjamin F. Butler lost his seat.

Further apprehensions were aroused by rumors concerning the
operations of a "Whiskey Ring." For some years it had been suspected
that a ring of revenue officials with accomplices in Washington were
in collusion with the distillers to defraud the government of the
lawful tax on whiskey. Part of the illegal gains were said to have
gone into the campaign fund for Grant's re-election, although he was
ignorant of the source of the revenue. Benjamin H. Bristow, who
became Secretary of the Treasury in 1874, began the attempt to stop
the frauds and capture the guilty parties. This was no simple task,
because information of impending action was surreptitiously sent out
by officials in Washington. Finally Secretary Bristow got the
information which he sought, and then moved to capture the criminals.
One of the most prominent members of the Ring was an internal revenue
official in St. Louis who, it was recollected, had entertained
President Grant, had presented him with a pair of horses and a wagon,
and had given the General's private secretary a diamond shirt-stud
valued at $2,400. Public opinion was yet further shocked, however,
when the trail of indictments led to the President's private
secretary, General Babcock. On first receiving the news of Bristow's
discoveries, Grant had written "Let no guilty man escape"; but later
he became secretly and then openly hostile to the investigation.
During the trial of Babcock, the President asked to be a witness in
his behalf. A verdict of acquittal was given, but afterwards the two
men had a private conference, and when "Grant came out, his face was
set in silence." Babcock never returned to the White House as
Secretary, but was given the post of Superintendent of Public
Buildings and Grounds. Several of the members of the Ring were
imprisoned but were later pardoned by the President. In the meanwhile
Grant seems to have been brought to believe that Bristow was
persecuting Babcock with a view to getting the favor of the reform
element in the party and eventually the presidential nomination.
Relations between the two became strained and Bristow resigned.

The last year of Grant's second administration was blackened by the
case of W.W. Belknap, who was then Secretary of War. Investigation by
a House committee uncovered the fact that since 1870 an employee in
the Indian service had paid $12,000 and later $6,000 a year for the
privilege of retaining his office. The money had been paid at first
to Mrs. Belknap, who had made the arrangement, and after her death to
the Secretary himself. The House unanimously voted to impeach him,
but on the day when the vote was taken he resigned and the President
accepted the resignation. Only the fact that he was out of office
prevented the Senate from declaring him guilty, and critics of the
administration noted that the President had saved another friend from
deserved punishment.

It would be easy to over-estimate the responsibility of General Grant
for the political corruption of his administrations. For the most
part the wrong-doing of the time began before his first election.
Democrats as well as Republicans participated in many of the
scandals. Politicians in the cities, the states and the nation seemed
to be determined to have a share in the enormous wealth that was
being created in America, and they got it by means that varied from
the merely unethical and indiscreet, to the openly corrupt. As for
the President, his own defence, given in his last message to
Congress, may be taken as the best one: "Failures have been errors of
judgment, not of intent."

Under the circumstances, however, it was natural that the
presidential campaign of 1876 should turn upon the failings of the
administration. Popular interest in the southern issue was on the
wane. Early in the election year, nevertheless, James G. Blaine,
Republican leader in the House, made a forceful attack on Jefferson
Davis, as the wilful author of the "gigantic murders and crimes at
Andersonville," the southern prison in which federal captives had
been held. Instantly the sectional hatred flared up and Blaine,
already a well-known leader, became a prominent candidate for the
nomination. Republican reformers generally favored Bristow. A
third-term boom for Grant was effectively crushed by an adverse
resolution in the House.

The Republican nominating convention met on June 14. The virtues of
Blaine were set forth in a famous speech by Robert G. Ingersoll in
which he referred to the attack on Davis: "Like an armed warrior,
like a plumed knight James G. Blaine marched down the halls of the
American Congress and threw his shining lance full and fair against
the brazen forehead of every traitor to his country." The "plumed
knight," however, was open to attack concerning a scandal during the
Grant regime, and the convention turned to Governor Rutherford B.
Hayes, of Ohio, a man of quiet ability who had been unconnected with
Washington politics, was relatively unknown and, therefore, not
handicapped by the antagonisms of previous opponents. The platform
emphasized the services of the party during the war, touched lightly
on the events of the preceding eight years, advocated payment of the
public debt, and favored import duties and the reform of the civil
service.

The Democrats met on June 27. There was little opposition to the
nomination of Governor Samuel J. Tilden, of New York, a wealthy
lawyer who had made a record as a reformer in opposition to "Boss"
Tweed and a corrupt canal ring. The platform was distinctly a reform
document. It demanded reform in the governments of states and nation,
in the currency system, the tariff, the scale of public expense, and
the civil service. An eloquent paragraph exhibited those corruptions
of the administration which had caused such general dismay.

There was little in the campaign that was distinctive, and on
November 8, the morning after the election, it seemed clear that
Tilden had been successful. He had carried the doubtful states of
Connecticut, New York, New Jersey and Indiana. When the figures were
all gathered, it was found that his popular vote exceeded that of his
rival by more than 250,000. But there were disputes in three states,
Florida, Louisiana and South Carolina. Hayes would be elected only if
the electoral votes of all these states could be obtained for him.
If, however, Tilden received even one electoral vote from any of the
states, the victory would be his. Hayes was conceded 166 electoral
votes; Tilden 184. Nineteen were in dispute. The Republican leaders
at once claimed the nineteen disputed votes, and asserted that their
candidate was elected. The Democrats had no doubt of the victory of
Tilden.[3] The capitals of the three doubtful states now became the
centers of observation. Troops had long been stationed in South
Carolina and Louisiana, and others were promptly sent to Florida.
Prominent politicians from both parties also flocked thither, in
order to uphold the party interests.

In South Carolina it became evident that a majority of the popular
vote was for Hayes, although both the Democratic and the Republican
electors sent in returns to Washington. In Florida there was a board
of canvassers which had power to exclude false or fraudulent votes.
It was composed of two Republicans and one Democrat. When all ballots
had been sent in, the Democrats claimed a majority of ninety; the
Republicans a majority of forty-five. The board went over the returns
and by a partisan vote threw out enough to make the Republican
majority 924. Republican electoral votes were thereupon sent to
Washington, but so also were Democratic votes. The situation in
Louisiana was still more complicated. Political corruption and
intimidation had been commonplaces in that state. On the face of the
returns, Tilden's electors had received majorities varying from 6,000
to 9,000. As in Florida there was a board of canvassers which was
here composed of four Republicans, three of whom were men of low
character. The vote of the state was offered to the Democrats, once
for $1,000,000 and once for $200,000, but the offer was not taken.
The board then threw out enough ballots to choose all the Hayes
electors. As in the other cases, Democratic electors also sent
ballots to Washington.

There was no federal agency with power to determine which sets of
electors were to be counted, and the fact that the federal Senate was
Republican and the House Democratic seemed to preclude the
possibility of legislation on the subject. No such critical situation
had ever resulted from an election, and a means of settlement must
quickly be discovered, for only three months would elapse after the
electoral votes were sent to Washington, before the term of General
Grant would expire. The means devised was the Electoral Commission.
This body was to be composed of five senators, five representatives,
and five justices of the Supreme Court. The Senate and the House were
each to choose their five members, and four members of the Court were
designated by the Act which established the Commission, with power to
choose a fifth. It was understood that seven would be Republicans,
seven Democrats and that the fifteenth member would be Justice David
Davis, an Independent, who would be selected by his four colleagues.
On him in all probability, the burden of the decision would fall. On
the day when the Senate agreed to the plan, however, the Democrats
and Independents in the Illinois legislature chose Justice Davis as
United States Senator and under these circumstances he refused to
serve on the Commission. It was too late to withdraw, and since all
the remaining justices from whom a commissioner must be chosen were
Republicans, the Democrats were compelled to accept a body on which
they were outnumbered eight to seven.

The Electoral Commission sat all through the month of February, 1877.
Its decisions were uniformly in favor of Hayes electors by a vote of
eight to seven, always along party lines, and on March 2, it was
formally announced that Hayes had been elected. The disappointment of
the Democrats was bitter and lasting, for their candidate had
received over a quarter of a million popular votes more than his
opponent, and yet had been declared defeated. For a time there was
some fear of civil war. Tilden, however, accepted the decision of the
Commission in good faith, and forbade his friends and his party to
resist. Moreover, close friends of the Republican candidate assured
southern Democratic politicians that Hayes if elected would adopt a
conciliatory policy toward the South, and would allow the southern
states to govern themselves unhampered by federal interference.
Peaceful counsels prevailed, therefore, and the closing days of
President Grant's administration were undisturbed by threats of
strife.

The question whether Hayes was fairly elected is a fascinating one.
There is no doubt that there was fraud and intimidation on both
sides, in the disputed states. In Louisiana, for example, the
Democrats prevented many negroes from voting by outrageous
intimidation, while the Republicans had many negroes fraudulently
registered. Little is known, also, of the activities of the "visiting
statesmen," as those politicians were called who went to the South to
care for their party interests. It is known that they were well
provided with money and that the boards of canvassers contained many
unscrupulous men. Nor is it likely that politicians who lived in the
days of the Credit Mobilier and the Whiskey King would falter at a
bargain which would affect the election of a president. Republicans
looked upon the Democrats as being so wicked that they were justified
in "fighting the devil with fire." Democrats looked upon the election
as so clearly theirs that no objection ought to be made to their
taking what belonged to them. It seems certain, however, that Hayes
had no hand in any bargains made by his supporters. As for Tilden,
his wealth was such that he could have purchased votes if he had
desired to do so, and the fact that all the votes went to his rival
indicates that he did not yield to the temptation. Moreover, one of
his closest associates, Henry Watterson, the journalist, tells of one
occasion when the presidency was offered to Tilden and refused by
him. Perhaps a definitive statement of the rights and wrongs of this
famous election will never be made; for one after another the men
most intimately associated with it have died leaving some account of
their activities, but none of them has told much more than was
already known.


BIBLIOGRAPHICAL NOTE

Dunning, Rhodes and Schouler, together with most of the works
referred to at the close of Chapter 1, continue to be useful. L.A.
Coolidge, _Ulysses S. Grant_ (1917), is not as partisan as most of
the biographies of the time and is valuable despite a lack of a
thorough understanding of the period. The following are valuable for
especial topics: H. Adams, _Historical Essays_ (1891); C.F. Adams,
Jr., and H. Adams, _Chapters of Erie_ (1886), (gold conspiracy); C.F.
Adams, Jr., _Charles Francis Adams_ (Treaty of Washington); C.F.
Adams, Jr., "The Treaty of Washington" in _Lee at Appomattox, and
Other Papers_ (1902); James Bryce, _American Commonwealth_ (vol. II,
various editions since 1888, contains famous chapter on the Tammany
Tweed ring); A.B. Paine, _Thomas Nast, His Period and His Pictures_
(1904), (Tweed ring). P.L. Haworth, _Hayes-Tilden Disputed
Presidential Election of 1876_ (1906), is a thorough study; on this
election, see also John Bigelow, _The Life of S.J. Tilden_ (2 vols.,
1895), and C.R. Williams, _Life of Rutherford B. Hayes_ (2 vols.,
1914).

       *       *       *       *       *

[1] The closing months of Johnson's administration found him almost in
a state of isolation. The incoming President refused to have any
social relations with him, or even to ride with him from the White
House to the Capitol on inauguration day. After the installation of
his successor, Johnson returned to Tennessee but was later chosen to
the Senate, where he served but a short time before his death.

[2] In 1884, a year before his death, the dishonesty of a trusted
friend left him bankrupt, while a painful and malignant disease began
slowly to eat away his life. Nevertheless, with characteristic courage
he set himself to the task of dictating his _Memoirs_, or more often
penciling sentences when he was unable to speak, in order that he
might repay his debts with the proceeds.

[3] There was also a technical question concerning one elector in
Oregon, which was easily settled.




CHAPTER III


ECONOMIC FOUNDATIONS OF THE NEW ERA

With the close of Grant's administration, the main immediate problems
connected with political reconstruction came to an end. During the war,
however, important economic and social developments had been taking
place throughout the United States which were destined to take on
greater and greater significance. The reconstruction problem looked
backward to the war; the new developments looked forward to a new
America. Reconstruction affected fewer and fewer people as time went
on; the later changes ultimately transformed the daily life of every
individual in the nation. Not only did they determine the means by
which he earned his livelihood, but the comforts which he enjoyed, the
conditions of rural or urban life which surrounded him, the ease with
which he visited other portions of the country or obtained information
concerning them, the number and variety of the foreign products that
could be brought to him, the political problems upon which he thought
and voted, and the attitude of the government toward his class in
society. Most of these changes were distinguishable during the
twenty-five years following the war and could be stated in brief and
definite terms.

From the standpoint of population, the growth of the country before
1890, although not so rapid as it had been before the war, was both
constant and important. Between 1870 and 1890 the numbers of people
increased from nearly thirty-nine millions to nearly sixty-three
millions, the rate each decade being not far from twenty-five per cent.
Six states added more than a million each to their population--New York
and Pennsylvania in the Northeast; Ohio, Illinois and Kansas in the
Middle West; and Texas in the South. No fewer than seventeen others
expanded by half a million or more--ten of the seventeen being in the
valley drained by the Mississippi River system.

Detailed study of particular sections of the country discloses a
continuous shifting of population which indicates changes in the
economic life of the people. In northern New England, the numbers
increased slowly. Both Maine and New Hampshire lost from 1860 to 1870;
nearly half of Maine's counties and nearly two-thirds of Vermont's lost
population between 1880 and 1890; the people were abandoning the rural
districts to flock to the cities or migrate to the West. Shipbuilding
fell off in Maine; the dairy interests languished in Vermont, less
wheat was being planted and the farmers, no longer growing wool, were
selling their flocks. Most of the growth was to be found in the
industrial counties. The traditional New England thrift, however, was
not lost with the migration of the people, for savings bank deposits
were increasing, and the state of Vermont was free from debt in 1880,
and all its counties in 1890. The South, between 1870 and 1890,
increased in numbers a little less rapidly than the country as a whole.
On the Atlantic Coast the greatest relative expansion was in Florida;
in the western South, in Texas. The increase was almost wholly native,
as immigration did not flow into that section.

The great expansion of the Middle West, from Ohio to Kansas, was based
upon the public land policy of the federal government. Substantially
all this region had once been in the possession of the United States,
which had early adopted the system of laying out townships six miles
on a side, with subdivisions one mile square, (containing 640 acres),
called sections. An important feature of the policy had been the
encouragement of education and of transportation through the gift
of large grants of the public land. Moreover, settlement had been
stimulated by the disposal of land to purchasers at extremely liberal
figures. In 1862 the famous Homestead Act had inaugurated a still
more generous policy. Under this law the citizen might settle upon a
quarter-section and receive a title after five years of actual
occupation, with no charge other than a slight fee. Millions of acres
were taken up in this way both by natives and by immigrants. 1,300,000
people poured into Illinois between 1870 and 1890; over 1,000,000 into
Kansas, and nearly that number into Nebraska; in the Dakotas a young
man of college age in 1890 might have remembered almost the entire
significant portion of the history of his state and have been one of
the oldest inhabitants. The frontier of settlement advanced from the
western edge of Missouri into mid-Kansas, and almost met the growing
population of the Far West, whose economic possibilities had already
attracted attention.

The discovery of gold-dust in a mill-race in California had drawn the
"Forty-niners" to

    ... lands of gold
    That lay toward the sun.

For a few years fabulous sums of the precious metal had been extracted
from the ground by the hordes of treasure-seekers who had come from
all over the world by boat, pack-animal or "prairie schooner," around
Cape Horn, across the Isthmus of Panama or over the western mountains.
When the yield of the mines had slackened, some of the population had
filtered off to newer fields, but more had settled down to exploit the
agricultural and lumber resources of California. In Nevada a rich vein
of silver called the "Comstock Lode" had been discovered; in 1873 a
group operating the "Virginia Consolidated" mine struck the great
"bonanza," and the output reached unheard of proportions. The success
of the mines, however, was essential to Nevada, which had few other
resources to develop, and when the yield slowed down the population
growth of the state noticeably slackened. In Colorado during the late
fifties some prospectors had struck gold, and another rush had made
"Pike's Peak or Bust" its slogan. Some had returned, "Busted by
Thunder," but others had better fortune, discovered gold, silver or
lead, and helped lay the foundations of Denver and Leadville. In Idaho
and Montana, in Wyoming and South Dakota and other states, prospectors
found gold, silver, copper and lead, and thus attracted much of the
population that later settled down to occupations which were less
feverish and more reliable than mining. In general, the advance of
population into the Middle West was more or less regular, as wave on
wave made its way into the Mississippi Basin; in the Far West,
however, population extended in long arms up the fertile valleys of
Washington, Oregon and California, or was found in scattered islands
where mineral wealth had been discovered in the Rocky Mountain region.

From the standpoint of absolute growth, the expansion of most of the
far western states was not imposing, but the relative increase was
suggestive of the future. Colorado nearly quadrupled in a decade,
(1870-1880), and Washington equalled the record in the following ten
years. California grew faster from 1870 to 1890 than it had done in
the gold days, indicating that its development was based on something
more lasting than a fickle vein of ore. Meanwhile politicians were
fanning the desire of the growing territories to become states, and in
1889 Montana and Washington were admitted, and in the following year
Idaho and Wyoming. Of these, Washington alone had a population
equivalent to the federal ratio for representation in the House.[1]

Utah was kept outside for a few years longer, until the Mormon Church
gave satisfactory indication that anti-polygamy laws were being
enforced.

The migration westward, which has been a constant factor in American
development since early times, continued unabated after the Civil War;
indeed the restless spirit aroused by the four years of conflict
undoubtedly tended to increase this steady shift toward the West. By
1890 approximately a fifth of the native Americans were to be found in
states other than those in which they had been born. 95,000 natives of
Maine, for example, were to be found in Massachusetts; 17,000 were in
California; and considerable numbers in every state between the two.
The North Carolinians were equally well distributed. 43,000 were in
South Carolina, 18,000 in Texas, and 5,500 in Washington. Every state
had contributed to populate every other, although in general the
migration tended to take place on east and west lines, and
predominantly westward.

Within the westward-moving tide of population were swirling
eddies--cities--which tended to attract to themselves larger and larger
proportions of the surrounding people. In 1870 two men in every ten
lived in cities whose population was 8,000 or more; by 1890 another man
in every ten had forsaken rural life. Large cities like Boston and New
York sucked in surrounding districts, and so constituted metropolitan
centers with problems new to American life. Such cities as Birmingham,
Kansas City, and Seattle were just appearing in 1880, but their growth
was very rapid; Los Angeles increased ten fold and Minneapolis
thirteen, between 1870 and 1890; Denver, having received ten newcomers
between 1860 and 1870, added 102,000 in the following twenty years.
In the country as a whole the concentration in cities was most marked
in the area north of the Potomac and Ohio rivers and east of the
Mississippi; the South remained rural, as before the war. With the
growth of urban population came questions of lighting and water supply,
street railway transportation and municipal government, industry,
education, health and morals.[2]

Immigration, another constant factor in American development,
underwent important changes during the twenty-five years from 1865
to 1890. Greater in prosperous years and smaller during years of
depression, the inward tide reached its climax in 1882, when 789,000
aliens reached the new world. That year, in several respects, was a
turning point in the history of immigration into the United States.
It was in this year that the Chinese were excluded; that immigration
from Italy, Austria-Hungary, and Russia became of sufficient size to be
impressive; and that the first inclusive federal immigration act was
passed. The immigration law of 1882 defined, in general, the policy
which the nation has pursued ever since. It placed a tax of fifty
cents on all incomers to be paid by the ship companies; it forbade the
landing of objectionable persons, such as convicts and lunatics; and
it placed on the owners of vessels the expense of returning immigrants
not permitted to land. All these provisions were amended or developed
in later laws, like that of 1885 forbidding persons or corporations to
prepay the transportation of laborers or to encourage immigration
under contract to perform work. The greater part of the foreign
population settled in the manufacturing and urban North. Put into
simplest terms, the census of 1890 showed that of every hundred aliens
who had come to the United States between 1870 and 1890, thirty-seven
were to be found in the states from Maine to Pennsylvania, four from
Delaware to Texas, forty-seven from Ohio to Kansas and twelve in the
Far West (for the most part Chinese).

Of the great economic interests of the United States, the most
widespread was agriculture. In the Northeast, to be sure, the amount
of improved farm land had been growing steadily less since 1850 and
the people had been turning their energies into other activities. In
the South, on the other hand, agriculture formed the main economic
resource and the twenty-five years following the war were, for the
most part, consumed in recovering from that struggle. Although
conditions varied from place to place, the situation in many portions
of the South was little short of pitiable. Not only were factories,
public buildings and railroads, houses and barns, tools and seeds
destroyed, capital and credit gone, mining at a standstill and banks
ruined, but bands of thieves infested many districts, federal officers
were frequently dishonest and defrauded the people, and the entire
labor system was wiped out at a stroke. The negroes had not been ideal
workmen as slaves; now, as freedmen, they found difficulty in
adjusting themselves to the economic obligations of their new status,
and evinced a tendency to rove about restlessly, instead of settling
down to the stern task of helping to rebuild the shattered South.

It was manifest that the first problem was to revive the agricultural
activities of the old days, and that the main resource must be cotton,
the demand for which in the markets of the North and of Europe was
such as to make it the best "money crop." A labor system was
introduced known as share-farming or cropping. Under this system the
plantation owner who had more property than he could cultivate under
the new conditions let parts of his land to tenants, supplying them
with buildings, tools, seed and perhaps credit at the village store
for the supplies necessary for the year. The tenant, who had neither
money nor credit with which to buy land, furnished the labor, and at
the harvest each received a specified share of the product, commonly a
half. The system had its disadvantages; it kept the farmer always in
debt, and since the only valuable security which the plantation owner
had was the crop--the land being almost unsalable--he insisted on
the cultivation of cotton, which was a safe crop, and avoided
experimentation and diversification. On the other hand, the system
enabled the land owner to take advantage of the labor supply and to
supervise the untutored negro,--and it kept the South alive. In
addition to the large plantations, cultivated by several tenant
farmers, the number of small farms tilled by independent owners or
renters increased. Due to this tendency and to the opening of many
small holdings in the Southwest, the size of the average farm
diminished, so that the small farmer began to replace the plantation
owner as the typical southerner.

Owing to the insistence of land owners upon cotton culture, the South
first caught up with its _ante-bellum_ production in the cultivation
of this staple, for shortly before 1880 the crop exceeded that of
1860. The production of tobacco, the second great southern crop,
sharply shifted after the war from the Atlantic Coast states, except
North Carolina, to the Mississippi region, especially to Kentucky.
Maryland, indeed, never again produced much more than half as great a
crop as she did in 1860, while Virginia did not equal her former
record until the opening of the twentieth century, although the South
as a whole recovered in the late eighties. Rice culture, likewise, did
not recover readily for South Carolina alone produced almost as much
in 1860 as the entire South in 1890, and not until the development of
production in Louisiana after 1890 did the crop assume its former
importance. The production of sugar in Louisiana in 1890 was but
little greater than it had been in 1860, and in the production of
cereals the South did not keep pace with the upper Mississippi Valley
before 1890. On the other hand the rapid growth of Texas was one of
the outstanding features of southern development during the period,
for that state improved an amount of farm land between 1870 and 1890,
roughly equivalent to the combined areas of New Hampshire, Vermont,
and Massachusetts. There was observable, moreover, a certain
hopefulness, a certain resiliency of purpose, a pride in the
achievements of the past and in the possibilities of the future. In
these respects the South was a new South by 1890.

Greater than the South as a food-producing area, was the belt of
states from Ohio and Michigan to Kansas and the Dakotas:

    Where there's more of reaping and less of sowing,
    That's where the West begins.

The increased occupation of the public lands, the growth of population,
improvements in transportation and the greater use of agricultural
machinery, which could be employed to advantage on the large and
relatively level farms, led to developments that were destined to have
an important effect on the history of the nation. Agricultural
machinery, such as the reaper, had been known long before the war, but
the reduction of the labor supply from 1861 to 1865 had compelled
farmers to replace men with machines. A reaper that merely cut the
grain and tossed it aside, gave way at last to one which not only cut
the grain, but gathered it into sheaves and bound the sheaves with
twine. So great was the effect of the harvester upon western
agriculture that William H. Seward declared that it "pushed the
frontier westward at the rate of thirty miles a year."

Due to the facts already mentioned, the number of mid-western farms
increased nearly a million from 1870 to 1890, and the acreage in
improved farm land grew by an amount equivalent to the combined areas
of the British Isles, Belgium, the Netherlands, and Denmark, with a
generous margin to spare. The production of corn, wheat, oats and other
cereals became so great as to demand an outlet to the East and to the
markets of the world. Elevators for the storage of grain were
constructed with a capacity of 300,000 to 1,000,000 bushels, and
improvements were made in the methods of loading and unloading the
product. Despite the growth of the agricultural interests of the Middle
West, however, the farmer did not reach prosperity. For twenty years
after 1873 prices fell steadily both in the United States and in other
countries of the world, and the agricultural classes found themselves
receiving a smaller and smaller return for their products. Unrest grew
to distress, and distress to acute depression, while the demands of the
farmers for relief frequently determined the trend of mid-western
politics.[3]

[Illustration:
Relative Prices--1865-1890]

Less general than agriculture, but more characteristic of the period
after the war, was the development of manufacturing. The census of 1870
was faulty and inadequate, but it was sufficiently accurate to indicate
that the manufacturing region was preeminently that north of the
Potomac-Ohio river line and east of the Mississippi. By 1890 it was
apparent that the industrial interests were shifting slightly toward
the West; nevertheless the leading states were those of southern New
England, and New York, New Jersey and Pennsylvania. In these states no
fewer than four hundred and forty-seven industries employed more than a
million dollars of capital each. The manufacturing of cotton, woolen
and silk for the rest of the country was done here; foundry products,
iron and steel manufactures, silver and brass goods, refined petroleum,
boots and shoes, paper and books, with a host of other articles, were
sent from this section to every part of the world. All along the line,
from Massachusetts to Pennsylvania, capital engaged in manufacturing
doubled between 1880 and 1890, and the number of employees greatly
increased.

Although the industrial life of the South belongs, for the most part,
to the years since 1890, the coal and iron deposits of Alabama were
known and utilized before that year, the number of cotton mill spindles
in North Carolina tripled between 1880 and 1890, and cotton expositions
were held in Atlanta in 1881 and New Orleans in 1884. It was in the
eighties, also, that the Chesapeake and Ohio Railroad and the Norfolk
and Western led to the exploitation of the coal deposits of Virginia
and West Virginia, especially the famous Pocahontas field.

Some aspects of the growth of manufacturing in the North are well
illustrated in the development of the mineral resources around Lake
Superior. The presence of copper and iron in this region had long been
known, but they had not been utilized until a decade before the Civil
War, and even then the output had been greatly restricted by
insufficient transportation facilities. By the close of the war,
however, a canal had been constructed which allowed the passage of
barges from Lake Superior to Lake Huron, and railroads had been laid to
a few important mining centers. The Marquette iron range in northern
Michigan, the Gogebic in Wisconsin and Michigan, the Menominee near
Marquette, the Vermilion Lake and Mesabec ore-beds near Duluth,--all
these combined to yield millions of tons of ore, caused the development
of numerous mining towns and laid the foundations of a gigantic
expansion in the production of steel. As the iron and steel industry
with its furnaces, machinery and skilled labor was already established
at points in Illinois, Ohio and western Pennsylvania, it was cheaper to
transport the ore to these places than to transfer the industry to the
mines. Ore vessels were constructed capable of carrying mammoth
cargoes; docks, railroads and canals were built; and the products of
the mines taken to lake and inland cities. Improvements, meanwhile,
were being continually made in the steel industry, such as the Bessemer
process, by which the impurities were burned out of the iron ore, and
exactly enough carbon introduced into the molten metal to transform it
into steel.

Although the steel industry was established in many places, its most
dramatic growth occurred in those parts of eastern Ohio and western
Pennsylvania that center about the city of Pittsburg. Placed
strategically at the point where the Allegheny and Monongahela rivers
join to form the Ohio, in the midst of an area rich in coal, petroleum
and natural gas, Pittsburg rapidly became the center of a region in
which the development of manufacturing and the construction of
railroads dwarfed other interests. A large portion of the ore mined in
the Lake Superior fields was carried to the Pittsburg district to be
transformed into steel products of all kinds. Moreover, the fortunes
made by private individuals in the region, and the inflow of alien
laborers to work in the factories and on the railroads raised weighty
social and industrial problems.

Manifestly the extension of agriculture and industry in so large a
country as the United States was dependent upon the corresponding
growth of the means of transportation, both by water and by rail. A
detailed account of the expansion of the railway net, with the
accompanying' implications in the fields of finance and politics, is a
matter for later consideration. Certain of its general features may be
mentioned, however, because they are intimately interwoven with the
economic developments which have just been explained. The concentration
of the population in the cities, of which New York and Chicago were
outstanding examples, was one of these features. From the time of the
first census, the city of New York continued to maintain its position
as the most populous city of the nation. Between 1850 and 1890 it added
a round million to its numbers, containing 1,515,000 persons at the
later date. Moreover it was the center of a thriving and thickly
settled region extending from New Haven on the one side to Philadelphia
on the other--the most densely populated area in America. The
uninterrupted expansion of the city indicated that the reasons for its
growth were constant in their operation. And, in fact, the reasons were
not difficult to find. It was blessed with one of the world's finest
harbors and had access to the interior of the state by way of the
Hudson and Mohawk rivers. These natural advantages had long since been
recognized and had been increased by the construction of the Erie Canal
in 1825 which, with the Great Lakes and the several canals connecting
the Lakes with the Ohio Valley, had given New York an early hold and
almost a monopoly on the trade between the upper Mississippi, the Lakes
and the coast. The city, therefore, became an importing and exporting
center; its shipping interests grew, immigration flowed in, and its
manufacturing establishments soon outstripped those of any other
industrial center; the great printing and publishing, banking and
commercial firms were drawn irresistibly to the most populous city, and
Wall Street became the synonym for the financial center of the nation.

In 1840 Chicago had been an unimportant settlement of 4500 persons, but
by the opening of the war it had grown to twenty-five times that size,
and added 800,000 between 1870 and 1890. It had early become evident
that the city was the natural outlet toward the East for the grain
trade and the slaughtering and meatpacking industry of the upper
Mississippi Valley. Before the late sixties, however, railway
connection was defective, being composed of many short lines rather
than of one continuous road, so that freight had to be loaded and
unloaded many times during its passage to the seaboard. This situation,
which had been merely inconvenient before the war, had become little
short of intolerable during the struggle, because the closing of the
Mississippi had cut off from the Middle West its water outlet toward
the South and had diverted more freight to the railroads. After the
war, Cornelius Vanderbilt, president of the Hudson River Railroad,
combined a number of the shorter roads so as to give uninterrupted
communication between Chicago and New York, to tap the trade of the
Mississippi Valley, and to compete with water traffic by way of the
Great Lakes and the Erie Canal. Other railroads saw the possibilities
in the western trade, and the Baltimore and Ohio, the Grand Trunk, and
the Erie followed the lead of Vanderbilt. A similar development,
although on a smaller scale, accompanied the growth of other northern
cities. The retroactive effects of the roads on the distribution of the
population are too detailed for discussion, but a single example may
typify many. In 1870 the Maine farmer supplied much of the meat
consumed in Boston; by 1895, he was getting his own meat from the West.
He must, therefore, adapt himself to the new conditions if he could,
move to the manufacturing cities as so many of his neighbors did, or
migrate to the West.

Like the growth of New York and Chicago, the development of California
had an important effect on the history of American railway
transportation. Although it had been agitated for many years, the
project for a railroad from the Mississippi to the Pacific Coast had
not reached the construction stage until the congressional acts of 1862
and 1864 provided for a line to be built from Omaha to San Francisco.
The Union Pacific Railroad had been incorporated to build the eastern
end, while the western end was to be constructed by the Central Pacific
Railroad Company, a California corporation. The latter act, that of
1864, had given the roads substantial financial assistance and half the
public land on a strip forty miles wide along the line of the track.
Many difficulties had stood in the way--lack of funds, problems of
construction and inadequate labor supply. Eventually they had all been
overcome by the energy and skill of such men as Stanford, Crocker and
Huntington. Imported Chinese coolies had met the labor demand and
construction was speeded up. Actual building had begun in 1863 and six
years later the two roads met at Promontory Point near Ogden in Utah,
where the last spike was driven, the engines

    Facing on the single track,
      Half a world behind each back.

During the four years following the completion of the transcontinental
line, 24,000 miles of new railroad were constructed, much of which was
built into the wilderness ahead of settlement. So great an expansion,
coming at a time when immense stretches of new land were being opened
and industry being developed on a large scale, could hardly fail to
result in over-speculation. The results appeared in 1873. Jay Cooke and
Company, the most important financial concern in the country had been
back of the Northern Pacific Railroad, marketing large quantities of
its bonds and so providing capital for construction, the purchase of
equipment, the payment of wages and so on. Obviously a large amount of
money was thus being put into an enterprise from which returns would
come only after a considerable period; and yet construction had to be
continued, or what was already invested would be lost. What Cooke was
doing for the Northern Pacific was being done for the Chesapeake and
Ohio by Fisk and Hatch, and by other firms for speculative enterprises
in every corner of the land.

The process of putting capital into fixed form could hardly go on
forever, and several events led to a final crash. In 1871 and 1872
great fires in Chicago and Boston destroyed millions of dollars' worth
of property. Early in 1873 the government investigation of the Credit
Mobilier Company led to widespread distrust of the roads and made
investors conservative about buying bonds. On September 18, 1873, Jay
Cooke and Company found itself unable to continue business and closed
its doors. The failure was a thunderbolt to the financial world.
Indeed, so unbelievable was the news that an energetic policeman
arrested a small newsboy who shouted his "Extra--All about the failure
of Jay Cooke."

If Jay Cooke and Company fell, the sky might fall. People rushed to
withdraw their funds from the banks. Fisk and Hatch opened their doors
for fifteen minutes and received calls for $1,500,000. They closed at
once. The smaller financial institutions followed the bigger ones.
Stocks fell, the Exchange was closed, there was a money famine.
Industrial concerns, dependent on the banks, failed by scores.
Industrial paralysis, with railroad receiverships, laborers out of
employment, riots and their accompaniments, showed how deep-seated had
been the trouble. Not until late in the decade did business recover its
former prosperity.

With the return of more stable conditions the construction of railroads
continued unabated. The Northern Pacific ran near the Canadian line and
connected the upper Mississippi Valley with the coast, carrying in its
trail the manners and customs of the East. Two lines in the South were
extended to the Pacific, so that by the middle eighties four great main
avenues gave passage through a region over which, so recently, the
miner and the trapper had forced a dangerous path.

The fact that it was often necessary, in building the railroads across
the plains, to detail half the working force to protect the remainder
against the Indians, calls attention to one unmistakable result of the
conquest of the Far West. The construction of the railroads spelled the
doom of the wild Indian. Far back in 1834 the government had adopted
the policy of setting aside large tracts of land west of the
Mississippi for the use of the Indian tribes. Most of the savages had
been stationed in an immense area between southern Minnesota and Texas,
while other smaller reservations had been scattered over most of the
states west of the river. On the whole, the government had dealt with
the Indians in tribes, not as individuals. The rapid inflow of
population to the fertile lands, together with the rush of prospectors
to newly discovered supplies of gold and silver, caused increasing
demands from the Indians for protection, and from the whites for the
extinguishment of Indian land titles.

The classical illustration of this tendency is found in the case of the
Sioux Indians in South Dakota. The discovery of gold in the region of
the Black Hills, on the Sioux reservation, aroused agitation for the
removal of the tribe to make way for settlers and miners. But the
execution of the scheme was not so simple as its conception. The
removal of the Sioux necessitated the transfer of the Poncas, a
peaceful tribe which lay immediately east. The latter, not unnaturally,
objected, quarrels arose and eventually the Poncas were practically
broken to pieces. The Sioux, not satisfied, attempted to regain the
Black Hills, fought the famous Sioux War of 1876, led by Sitting Bull,
but were crushed and forced to give up the unequal contest.

It would not be worth while to enter into the details of the numerous
Indian conflicts after the Civil War. It is enough to notice that
stirring accounts of them may be read in the memoirs of such soldiers
as Custer, Sheridan and Miles, and that they cost millions of dollars
and hundreds of lives. Finally it became evident that the attempt to
deal with the Indians in tribes was a failure and it was determined to
break up the tribal holdings of land so as to give each individual a
small piece for his private property, and to open the remainder to
settlement by the whites. In pursuance of such a policy, the Dawes Act
of 1887 provided for the allotment of a quarter-section to each head of
a family, with the proviso that the owner should not sell the land
within twenty-five years. This was intended to protect the Indian from
shrewd "land-sharks." Citizenship was given with the ownership of the
land, in the hope that a sort of assimilation might gradually take
place, and earnest attempts were made to provide education for the
red-man. Not all these hopes were realized, however, and the later
Burke Act, 1906, attempted further protection.

While the Indian was being restricted to a small part of the great
region west of the Mississippi, there was being enacted on the plains
one of the most picturesque of all American dramas. Beyond the settled
parts of the states just west of the "Father of Waters," bounded north
and south by Canada and the Rio Grande, and extending west to the Rocky
Mountain foot-hills, lay a huge empire of rolling territory. It was
grass-covered, but lacked sufficient rainfall to make it fertile, so
that it was considered, as part of it had early been called, "the great
American desert."

Cattle turned loose long before by Spanish ranchers down in the
Southwest had multiplied, spread out over the plains, and run
wild--wild as Texas steers. A combination of circumstances disclosed
the fact that these cattle could be improved by breeding, corraled and
driven north over the "Long Trail," to be slaughtered in Omaha, Kansas
City, St. Louis and Chicago for the people of eastern cities. The
round-up, when the cattle were collected; the drive, under command of
the boss and his cow-boys,

    loose in the unfenced blue riding the sunset rounds;

the great ranches in the North, where the herds were fattened for the
market;--all this formed the background of an attractive romance.
Obviously, however, the drive was dependent on great stretches of open
country, with free grazing and free access to water, and it is also
manifest that these conditions could not long endure in the face of
constant westward migration. Homesteaders followed the railroads out
across the plains, and the cheapening of wire fence led to the
enclosure of great farms including the best grazing lands and the water
supply. By 1890, therefore, the great drives were a tale that is told.
The less romantic packing business remained, however; ranches supplied
the cattle, the railroads transported them, and improvements in
refrigerating and canning made possible another development in domestic
and foreign trade.

In addition to the expansion of the several economic interests of the
various sections of the country, inventions and improvements were
taking place which affected the general problems of production and
distribution. Improvements in machinery saved forty to eighty per cent.
of the time and labor demanded in the production of important
manufactured goods. Cheapened steel affected all kinds of industry. The
development of steam-power and the beginnings of the practical use of
electricity for power and light multiplied the effectiveness of human
hands or added to human comfort. Cheaper and quicker transportation
almost revolutionized the distribution of economic goods. The increased
use of the telegraph and cable shortened distances and brought together
producers and consumers that had in earlier times been weeks of travel
apart.

The necessarily statistical character of an account of economic
development should not obscure the meaning of its details. Increased
population, with its horde of incoming aliens, created a demand for
standing room, necessitated westward expansion, and made the West more
than ever a new country with new problems. The growth of agriculture
enlarged a class that had not hitherto been as influential as it was
destined to be, and brought into politics the economic needs of the
farmer. Manufacturing brought great wealth into the hands of a few,
created an increasing demand for protective tariffs and gave rise to
strikes and other industrial problems. The concentration of especial
interests in especial sections made likely the emergence of sectional
antagonisms. Back of tariff and finance, therefore, back of
transportation and labor, of new political parties and revolts in the
old ones, of the great strikes and the increasing importance of some of
the sections, lay the economic foundations of the new era.


BIBLIOGRAPHICAL NOTE

No thorough study of the economic history of the United States after
the Civil War has yet been made. E.L. Bogart, _Economic History of the
United States_ (1907), and various later editions, is the best single
volume; E.E. Sparks, _National Development_ (1907), is useful. On the
South, consult articles by St. G.L. Sioussat, in _History Teachers'
Magazine_ (Sept., Oct., 1916); P.A. Bruce, _Rise of the New South_
(1905); J.C. Ballagh (ed.), _South in the Building of the Nation_
(1909), vol. VI; M.B. Hammond, _Cotton Industry_ (1897). R.P. Porter,
_West from the Census of 1880_ (1882), is a useful compendium. The
Plains in the day of the cowboy are well described in Emerson Hough,
_Passing of the Frontier_ (1918); Emerson Hough, _Story of the Cowboy_
(1898); F.L. Paxson, _Last American Frontier_ (1910); and F.L. Paxson,
"The Cow Country," in _American Historical Review_, Oct., 1916. N.A.
Miles, _Serving the Republic_ (1911), contains reminiscences of Indian
conflicts. On the Far West, in addition to Porter, Hough and Paxson,
Katharine Coman, _Economic Beginnings of the Far West_ (2 vols., 1912);
H.K. White, _Union Pacific Railway_ (1898); L.H. Haney, _Congressional
History of Railways_ (2 vols., 1908-1910); S.E. White, _The
Forty-Niners_ (1918).

There is also an abundance of useful illustrative fiction, such as:
Bret Harte, _Luck of Roaring Camp_, and other stories (Far West);
Edward Eggleston, _Hoosier Schoolmaster_ (Indiana); W.D. Howells,
_Rise of Silas Lapham_ (New England); G.W. Cable, _Old Creole Days_
(New Orleans); C.E. Craddock, _In the Tennessee Mountains_; F.H.
Smith, _Colonel Carter_ (Virginia); Hamlin Garland, _Main Travelled
Roads_ and _Son of the Middle Border_ (Middle West); P.L. Ford, _Hon.
Peter Sterling_ (New York); S.E. White, _Gold_ (California); and
_Riverman_ (Lake Superior lumber); John Hay, _Breadwinners_ (industrial).

For other references to economic aspects of the period, see chapters
IX, XI, XIV.

       *       *       *       *       *

[1] The ratio was 151,912 but, by a provision of the Constitution,
states are given a representative even if they do not contain the
requisite number.

[2] The most important advances in municipal street railway
transportation were made between 1875 and 1890. In 1876 New York began
the construction of an overhead or elevated railway on which trains
were drawn by small locomotives. The first electric street railways
were operated in Richmond, Va., and in Baltimore. Electric street
lighting was introduced in San Francisco in 1879.

[3] Hamlin Garland, _Main Travelled Roads_, portrays the hardships of
western farm life.




CHAPTER IV


POLITICAL AND INTELLECTUAL BACKGROUND OF THE NEW ISSUES

Powerful as economic forces were from 1865 to 1890, they did not alone
determine the direction of American progress during those years.
Different individuals and different sections of the country reacted
differently to the same economic facts; a formula that explained a
phenomenon satisfactorily to one group, carried no conviction to
another; political parties built up their platforms on economic
self-interest, and yet they sometimes had their ideals; theories that
seemed to explain economic development were found to be inadequate and
were replaced by others; and practices that had earlier been regarded
with indifference began to offend the public sense of good taste or
morals or justice, and gave way to more enlightened standards. Some
understanding is necessary, therefore, of the more common theories,
ideals, creeds and practices, because they supplemented the economic
foundations that underlay American progress for a quarter century after
the war.

Since the Republican party was almost continuously in power during this
period, its composition, spirit and ideals were fundamental in
political history. Throughout the North, and especially in the
Northeast, the intellectual and prosperous classes, the capitalists and
manufacturers, were more likely to be found in the Republican party
than among the Democrats. In fact such party leaders as Senator George
F. Hoar went so far as to assert that the organization comprised the
manufacturers and skilled laborers of the East, the soldiers, the
church members, the clergymen, the school-teachers, the reformers and
the men who were doing the great work of temperance, education and
philanthropy. The history of the party, also, was no small factor in
its successes. Many northerners had cast their first ballot in the
fifties, with all the zeal of crusaders; they looked back upon the
beginnings of Republicanism as they might have remembered the origin of
a sacred faith; they thought of their party as the body which had
abolished slavery and restored the Union; and they treasured the names
of its Lincoln, its Seward, its Sumner and Grant and Sherman. The
Republican party, wrote Edward MacPherson in 1888, in a history of the
organization, is

    both in the purity of its doctrines, the beneficent sweep of its
    measures, in its courage, its steadfastness, its fidelity, in its
    achievements and in its example, the most resplendent political
    organization the world has ever seen.

Senator Hoar declared that no party in history, not even that which
inaugurated the Constitution, had ever accomplished so much in so short
a time. It had been formed, he said, to prevent the extension of
slavery into the territories, but the "providence of God imposed upon
it far larger duties." The Republican party gave "honest, wise, safe,
liberal, progressive American counsel" and the Democrats "unwise,
unsafe, illiberal, obstructive, un-American counsel." He remembered the
Republican nominating convention of 1880 as a scene of "indescribable
sublimity," comparable in "grandeur and impressiveness to the mighty
torrent of Niagara."

During the generation after the war the recollection of the struggle
was fresh in men's minds and its influence was a force in party
councils. The Democrats were looked upon as having sympathized with the
"rebellion" and having been the party of disunion. In campaign after
campaign the people were warned not to admit to power the party which
had been "traitor" to the Union. Roscoe Conkling, the most influential
politician in New York, declared in 1877 that the Democrats wished to
regain power in order to use the funds in the United States Treasury to
repay Confederate war debts and to provide pensions for southern
soldiers. As late even as 1888 the nation was urged to recollect that
the Democratic party had been the "mainstay and support of the
Rebellion," while the Republicans were the "party that served the
Nation."

At a later time it was pointed out that the party had not been founded
solely on idealism; that the adherence of Pennsylvania to the party,
for example, was due at least in a measure to Republican advocacy of a
protective tariff; that Salmon P. Chase and Edwin M. Stanton, two of
the leading members of Lincoln's cabinet had been Democrats; and that
Lincoln's second election and the successful outcome of the war had
been due partly to the support of his political opponents. As time went
on, also, some of the leaders of the Republican party declared that its
original ideals had become obscured in more practical considerations.
They felt that abuses had grown up which had been little noticed
because of the necessity of keeping in power that party which they
regarded as the only patriotic one. They asserted that many of the
managers had become arrogant and corrupt. All this helped to explain
the strength of such revolts as that of the Liberal Republican movement
of 1872. Nevertheless, during the greater part of the twenty-five years
after the war, hosts of Republicans cherished such a picture as that
drawn by Senator Hoar and Edward MacPherson, and it was that picture
which held them within the party and made patriotism and Republicanism
synonymous terms.

These Republicans, however, who took the more critical attitude toward
their party formed the core of the "Mugwump" or Independent movement.
Their philosophy was simple. They believed that there ought to be a
political element which was not rigidly controlled by the discipline of
party organization, which would act upon its own judgment for the
public interest, and which should be a reminder to both parties that
neither could venture upon mischievous policies without endangering its
control over the machinery of government. Theoretically, at least, the
Independent believed that it was more important that government be well
administered than that it be administered by one set of men or another.
The weakness of this group, aside from its small size, was its
impatience and impracticability. By nature the Independent was an
individualist, forming his own opinion and holding it with tenacity. In
such a body there could not be long-continued cooperation or singleness
of purpose; each new problem caused new decisions resulting in the
break-up of the group and the formation of new alignments. The
Independent group, therefore, varied in strength from campaign to
campaign. To the typical party worker, who looked upon politics as a
warfare for the spoils of office, the Independent was variously
denounced as a deserter, a traitor, an apostate and a guerilla
deploying between the lines and foraging now on one side and now on the
other. To the party wheel-horse, independent voting seemed
impracticable, and the atmosphere of reform too "highly scented."

The Democrats, laboring under the disadvantage of a reputation for
disloyalty during the war, and kept out of power for most of the time
during the period, were forced into a defensive position where they
could complain or criticize, but not present a program of constructive
achievement. They denounced the election of 1876 as a great "fraud";
they looked upon the Republicans as the organ of those who demanded
class advantages; they condemned the party as wasteful, corrupt and
extravagant in administration, careless of the distress of the masses,
and desirous of increasing the authority of the federal government at
the expense of the powers of the states. Their own mission they felt to
be the constant assertion of the opposite principles of government and
administration. They felt that they in particular represented
government by the people for the equal good of all classes. In
conformity to what they believed to be the principles of Jefferson and
Jackson they professed faith in the capacity of the plain people. They
advocated frugality and economy in government expenditure and looked
with alarm on any extension of federal power that invaded the
traditional domain of local activity.

The intensification of party spirit and party loyalty, which was so
typical of the times, "delivered the citizen more effectually, bound
hand and foot, into the power of the party embodied in its
Organization." The organization, meanwhile, was being improved and
strengthened. Its permanent National Committee which had existed from
_ante-bellum_ days, was supplemented in both parties immediately after
the war by the congressional committee, whose mission it was to carry
the elections for the House of Representatives. Increased attention was
paid to state and local organizations. Party conventions in states and
counties chose delegates to national conventions and nominated
candidates for office. State, county and town committees raised money,
employed speakers, distributed literature, formed torch-light companies
to march in party processions and, most important of all, got out the
voters on election day. By such means the National Committee was
enabled to keep in close touch with the rank and file of the party, and
so complete did the organization become that it deserved and won the
name, "the machine."

The master-spirit of the machine was usually the "Boss," a professional
politician who generally did not himself hold elective office or show
concern in constructive programs of legislation or in the public
welfare. Instead, his interests lay in winning elections; dividing the
offices among the party workers; distributing profitable contracts for
public work; procuring the passage of legislation desired by industrial
or railroad companies, or blocking measures objected to by them. A
vivid picture of the activities of the boss in New York, drawn by Elihu
Root, will serve to portray conditions in many states and cities from
1865 to 1890:

    From the days of Fenton, and Conkling, and Arthur, and Cornell,
    and Platt, from the days of David B. Hill, down to the present
    time, the government of the state has presented two different lines
    of activity, one of the constitutional and statutory officers of
    the state, and the other of the party leaders,--they call them
    party bosses. They call the system--I do not coin the phrase, I
    adopt it because it carries its own meaning--the system they call
    "invisible government." For I do not remember how many years, Mr.
    Conkling was the supreme ruler in this state; the governor did not
    count, the legislatures did not count; comptrollers and secretaries
    of state and what not, did not count. It was what Mr. Conkling
    said; and in a great outburst of public rage he was pulled down.

    Then Mr. Platt ruled the state; for nigh upon twenty years he ruled
    it. It was not the governor; it was not the legislature; it was not
    any elected officers; it was Mr. Platt. And the capitol was not
    here (in Albany); it was at 49 Broadway; with Mr. Platt and his
    lieutenants. It makes no difference what name you give, whether you
    call it Fenton or Conkling or Cornell or Arthur or Platt, or by the
    names of men now living. The ruler of the state during the greater
    part of the forty years of my acquaintance with the state
    government has not been any man authorized by the constitution or
    by the law.[1]

Under such conditions, corruption was naturally a commonplace in
politics. In the campaigns, the party managers were too often men to
whom "nothing was dreadful but defeat." At every Presidential election,
immense sums of money were poured into the most important doubtful
states--Connecticut, New York, New Jersey and Indiana. Twenty to
seventy-five dollars was said to have been the price of a vote in
Indiana in 1880; and ten to fifteen per cent. of the vote in
Connecticut was thought to be purchasable. In New York ballot-box
stuffing and repeating were the rule in sections of the city. Employers
exerted a less crude but equally efficacious pressure upon their
employees to vote "right." Municipal government also was often
characterized by that extreme of corruption which called out the scorn
of writers on public affairs. The New York _Times_ complained in 1877
that the government of the city was no more a popular government than
Turkish rule in Bulgaria, and that if the Tammany leaders did not
collect revenue with the horse-whip and sabre, it was because the forms
of law afforded a means that was pleasanter, easier and quite as
effective.

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 facto_ laws, 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 County _v._
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
County _v._ 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 Company _v._ 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 of _laissez 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 the _laissez faire_ philosophy. The economic
giant and hero was the self-made man.

Economic abuses, according to the _laissez faire_ philosophy, 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 of _laissez faire_ was 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 the
_North American Review_ in 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 the _laissez faire_ theory was dominant later even than 1890,
it was apparent before that time that its sway was being challenged.
The adherents of _laissez faire_ themselves 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 of _laissez 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 upon _laissez faire_ would
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 the _laissez faire_ doctrine 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
York _Herald_, for example, in 1835, and from then on the _Herald_ had
been "Bennett's paper." Similarly the _Tribune_ had represented Horace
Greeley and the _Times_, 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 the _Sun_ was the embodiment
of Charles A. Dana until his death in 1897, the _Nation_ and the
_Evening Post_ of 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 York _Times_ and Thomas Nast's cartoons in
_Harper's Weekly_ were 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.


BIBLIOGRAPHICAL NOTE

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, consult _Harper's Weekly_ during 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,
consult _History Teachers' Magazine_ (later the _Historical 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), on _laissez 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 in _The 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.




CHAPTER V


THE NEW ISSUES

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 of _The 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 Hepburn _v._ 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 (Knox _v._
Lee, and Parker _v._ Davis). The decision, which was announced in 1871,
over-ruled the judgment in Hepburn _v._ 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 the _Autobiography_ of 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 like _Harper's Weekly_ and _The 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 on _Harper's Magazine_ and
afterwards, for many years, as editor of _Harper'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.


BIBLIOGRAPHICAL NOTE

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's _Thirty Years_ and 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).

       *       *       *       *       *

[1] This is the amount still outstanding.




CHAPTER VI


THE ADMINISTRATION OF RUTHERFORD B. HAYES

The conditions which confronted President Hayes when the final decision
of the Electoral Commission placed him in the executive chair did not
make it probable that he could carry out a program of positive
achievement. The withdrawal of troops from the South had been almost
completed, but the process of reconstruction had been so dominated by
suspicion, ignorance and vindictiveness that sectional hostility was
still acute. As has been seen, the economic problems which faced the
country were for the most part unsolved; on the subjects of tariff,
finance and the civil service, neither party was prepared to present a
united front; and the lack of foresight and statesmanlike leadership in
the parties had given selfish interests an opportunity to seize control.
Nor did the circumstances surrounding the election of Hayes tend to
simplify his task, for the disappointment of the Democrats was extreme,
and they found a natural difficulty in adjusting themselves to the
decision against Tilden. Democratic newspapers dubbed Hayes "His
Fraudulency" and "The Boss Thief," printed his picture with "Fraud"
printed across his brow and referred to his election as the "steal" and
a "political crime."

The man who was to essay leadership under such conditions had back of
him a useful even if not brilliant career. He had been born in Ohio in
1822, had graduated from Kenyon College as valedictorian of his class,
attended Harvard Law School and served on the Union side during the war,
retiring with the rank of a brevet Major General. He had been twice
elected to Congress, but had resigned after his second election to
become governor of his native state, a position which he had filled for
three terms.

Hayes was a man of the substantial, conscientious and hard-working type.
He was not brilliant or magnetic, he originated no innovations, burst
into no flights of imaginative oratory. His state papers were planned
with painstaking care--first, frequently, jotted down in his diary and
then elaborated, revised, recopied and revised again. The vivid
imagination and high-strung emotions that made Clay and Blaine great
campaigners were lacking in Hayes. He was gentle, dignified, simple,
systematic, thoughtful, serene, correct. In making his judgments on
public questions he was sensitive to moral forces. The emancipation of
the slaves was not merely wise and just to him--it was "Providential."
He favored a single six-year term for the President because it would
safeguard him from selfish scheming for another period of power. Partly
because of the lack of dash and compelling force in Hayes, but more
because of the low standards of political action which were common at
the time, his scruples seemed puritanical and were held up to ridicule
as the milk-and-water and "old-Woman" policies of "Granny Hayes." His
public, as well as-his private life, was unimpeached in a time when
lofty principles were not common and when scandal attached itself to
public officers of every grade. To his probity and the "safe" character
of his views, as well as to his record as governor of an important
state, was due his elevation to the presidency.[1] In his habit of
self-analysis, Hayes was reminiscent of John Quincy Adams. Like Adams he
kept a diary from his early youth, the serious and mature entries in
which cause the reader to wonder whether Hayes ever had a childhood.
When he had just passed his twentieth birthday he confided to his diary
that he found himself unsatisfied with his progress in Blackstone, that
he must curb his "propensity" to read newspapers to the exclusion of
more substantial matter, and in general that he was "greatly deficient
in many particulars." Then and in later years he noted hostile
criticisms of himself and combated them, recorded remarks that he had
heard, propounded questions for future thought, expressed a modest
ambition or admitted a curbed elation over success.

In the field of politics Hayes was looked upon as a reliable party man,
a reputation which was justified by his rigid adherence to his party and
by his attitude toward the opposition. In both these respects he was the
ordinary partisan. Nevertheless he thought out his views with unusual
care, made them a matter of conscience and measured policies by ethical
standards that were more exacting than the usual politician of the time
was accustomed to exercise. The only remark of his that gained wide
circulation reflects his type of partisanship: "he serves his party best
who serves his country best." In these latter respects--his
thoughtfulness, conscientiousness, exacting standards of conduct and
less narrowly partisan spirit--he formed a contrast to the most
influential leaders of his party organization. Altogether it seemed
likely at the start that Hayes might have friction with the Republican
chiefs.

The opening of the administration found public interest centered on the
inaugural address and the Cabinet.[2] The inaugural set forth with
clearness and dignity the problems which the administration desired to
solve: the removal of the barriers between the sections on the basis of
the acceptance of the war amendments, southern self-government and the
material development of the South; reform in the civil service,
thorough, radical and complete; and the resumption of specie payments.
To the choice of a cabinet, Hayes devoted much painstaking care. For
Secretary of State, he nominated William M. Evarts of New York, an
eminent lawyer who had aided Charles Francis Adams in his diplomatic
battle with England during the Civil War and later in the Geneva
Arbitration, had shown wit and finesse in the defence of Andrew Johnson
in the impeachment trial, and had valiantly assisted the Republican
cause before the Electoral Commission. In addition, Evarts was a man of
the world who knew how to make the most of social occasions and was an
orator of reputation. The Secretary of the Treasury was John Sherman of
Ohio, who had been for years chairman of the finance committee of the
Senate, and was an example of the more statesmanlike type of senator of
war and reconstruction times.

The nomination of Carl Schurz, as Secretary of the Interior, and David
M. Key, as Postmaster-General, caused an uproar among the party leaders.
Schurz was a cosmopolitan, a German-American, a scholar, orator, veteran
of the Civil War, friend of Lincoln, and independent thinker. His
devotion to the cause of civil service reform recommended him to the
friendship of the President and to the enmity of the political leaders.
The politicians scored Schurz as not a trustworthy Republican--he was
independent by nature and had been a leader in the Liberal Republican
movement; and they denounced him as an impractical man, whose head was
full of transcendental theories--which was a method of saying that he
was a civil service reformer. No little excitement was occasioned by the
appointment of Key. The President had desired to appoint to the cabinet
a southerner of influence, and had thought of Joseph E. Johnston as
Secretary of War. The choice of General Johnston would have been an act
of great magnanimity, but since General Sherman, to whom Johnston had
surrendered only twelve years before, was commander of the army, it
would have placed Sherman in the singular position of taking military
orders from a former leading "rebel." When Hayes consulted his party
associates, however, he found their feelings expressed in the
exclamation of one of them: "Great God! Governor, I hope you are not
thinking of doing anything of that kind!" He thereupon reluctantly gave
way and turned to Key. The latter was less prominent than Johnston, but
had been a Confederate leader, was a Democrat and a man of moderate
counsels. The remaining members of the cabinet were men of much less
moment, but altogether it is clear that few presidents have been
surrounded by so able a group of advisers.[3]

Seldom, also, has a president's announcement of his cabinet caused so
much dissent among his own supporters. Senator Cameron, of Pennsylvania,
had urged a cabinet appointment for his son, and on being refused became
hostile to Hayes. Senator Blaine, of Maine, was piqued because Hayes
refused to offer a place to a Maine man; the friends of General John A.
Logan, of Illinois, were dissatisfied at the failure of Hayes to
understand the qualifications of their favorite; Conkling disliked
Evarts and besides desired a place for his associate Thomas C. Platt;
and the latter considered the nomination of Evarts a "straight-arm" blow
at the Republican organization. Departing, therefore, from the custom in
such cases, the Senate withheld confirmation of the nominations for
several days, during which it became apparent that the rest of the
country had received the announcement of the cabinet with favor, and
then the opposition disappeared. During the remainder of his presidency,
however, Hayes fared badly in making his nominations to office, for
fifty-one of them were rejected outright, a larger number than had ever
before been disagreed to when the President and the Senate were of the
same party. The frequency with which the nominations were rejected and
the combative manner in which the contests were carried on by the Senate
indicated that it was determined to regain and hold fast the influence
in federal counsels that it had relinquished to the executive during the
war.

Aside from the nomination of members of the cabinet, the first important
executive action that tested the attitude of the Senate toward the
President was in relation to the southern problem. By March, 1877, all
the former Confederate states except Louisiana and South Carolina had
freed themselves from Republican rule by the methods already mentioned,
and in these states the Republicans were kept in power only by the
presence of troops. In Louisiana, both Packard, a Republican
carpet-bagger, and Nicholls, a Louisiana Democrat, claimed to be the
rightful governor. In South Carolina, the Republican contestant was
Chamberlain, a native of Massachusetts; the Democrat was Wade Hampton, a
typical old-time southerner. Hayes could withdraw the troops, in
pursuance of his conciliatory policy, but if he did the Republican
governments would certainly collapse because they were unsupported by
public opinion. Furthermore, the returning board which had declared
Hayes the choice of Louisiana in the presidential election had asserted
that the Republican Packard was elected. Blaine, in the Senate,
championed the doctrine that Hayes could not forsake the southern
Republicans without invalidating his own title. Speaking in a confident
and aggressive manner, he held that the honor, faith and credit of the
party bound it to uphold the Republican claimants. Nevertheless, the
President investigated conditions in both states, satisfied himself that
public opinion was back of the Democratic governments and then recalled
the troops, hardly more than a month after his inauguration. The
Republican governments in the two states promptly gave way to the
Democrats, and the storm was on in the Senate.[4]

The Republican politicians believed that no good thing could come from
the "rebels," that the President was abandoning the negro, and that he
was surrendering the principles for which the party had contended.
"Stalwarts," was the name applied by Blaine to these uncompromising
party men who would not relinquish the grip of the organization on the
southern states. Hayes was freely charged with having promised the
removal of the military forces in return for the electoral votes of the
two states concerned, and some color seemed to be lent to this
accusation when he proceeded to reward the Louisiana and Florida
returning boards with appointments to office. Even the New York _Times_,
which usually supported Hayes with vigor, characterized the Louisiana
settlement as "a surrender." William E. Chandler who had assisted Hayes
as counsel in the disputed election attacked him in a pamphlet, "Can
such Things be and overcome us like a Summer Cloud without our Special
Wonder?" Most of the influential leaders in both houses of Congress
scarcely disguised their hostility. Indeed the discontent went back into
the states where, as in New Hampshire, a contest over the endorsement of
Hayes was so bitter that the newspaper reporters had to be excluded from
the state convention to prevent public reports of schism in the party.
The Democrats could not come to his support since they were unable to
forget the election of 1876 even in their satisfaction over the
treatment accorded the South. In six weeks the President was without the
backing of most of his party leaders. On the other hand, a few men of
the type represented by Hoar and Sherman commended the President's
policy. Independent publications such as _Harper's Weekly_ did likewise,
and when the Republican convention of 1880 drew up the party platform
the leaders made a virtue of necessity and adopted a plank
enthusiastically supporting the Hayes administration.

After he had finished with the southern problem, Hayes confided to his
diary, "Now for civil service reform!" And for appointments in general
he recorded several principles: no sweeping changes; recommendations by
congressmen to be investigated--not merely accepted; and no relatives of
himself or his wife to be appointed, however good their qualifications
might be. In the meanwhile Secretary Schurz set to work to put the
Department of the Interior on a merit basis. The principles that Hayes
set up for himself and the steps that Schurz took were in conformity
with the party platform of 1876 and with the President's inaugural
address; nevertheless the party leaders were displeased, if not
surprised, for platform promises were lightly regarded and inaugural
addresses were sometimes not to be taken very seriously.

The earliest acts of Hayes were not such as to facilitate the further
progress of reform. The appointment of the members of the Louisiana
Returning Board to federal offices gave color to charges that they were
receiving their reward for assisting the President into his position.
Furthermore, on June 22, 1877, he issued an executive order forbidding
any United States officials to take part in the management of political
organizations and declaring that political assessments on federal
officers would not be allowed. So drastic an order brought amazement to
the party leaders, who had not dreamed of anything so radical. Perhaps
the order was too sudden and sweeping, considering the practices of the
time. At any rate it was not enforced and the President seemed to have
set a standard to which he had not the courage to adhere. Nevertheless,
reform principles were successfully tested in the New York Post Office
by Thomas L. James, a vigorous exponent of the merit system who had been
appointed by President Grant and was now re-appointed and upheld by
President Hayes.

But the great battle for the new idea came in connection with the New
York Custom House. Through the port of New York came two-thirds to
three-fourths of the goods which were imported into this country, and
the necessity for a businesslike conduct of the custom house seemed
obvious. Yet there had for some time been complaints concerning the
service, and Sherman appointed commissions, with the approval of the
President, to investigate conditions in New York and elsewhere. The
commission which studied the situation in New York reported that
one-fifth of the persons employed there were superfluous, that
inefficiency and neglect of duty were common, and that the positions at
the disposal of the collector had for years been used for the reward of
party activity. The commission recommended sweeping changes which
Secretary Sherman and President Hayes approved. It then appeared that
the New York officials were not favorable to the President's reform
plans. Furthermore, Chester A. Arthur, the collector of the port, was a
close friend of Roscoe Conkling, the head of the state machine; and A.B.
Cornell, the naval officer, was chairman of the state and national
Republican committees; It was evident that an attempt to change
conditions in New York would precipitate a test of strength between the
administration and the New York organization.

As Arthur and Cornell would not further the desired reforms and would
not resign, the President removed them. When he nominated their
successors, however, the Senate, led by Conkling, refused to add its
confirmation and there the matter rested for some months. Eventually the
President's nominations were confirmed, an outcome which seems to have
been brought about in part at least by letters from. Secretary Sherman
to personal friends in the Senate in which he urgently pressed the case
of the administration. The President's victory emphasized the
disagreement of the powerful state organization with the reform idea,
and while the reformers rejoiced that the warfare had been carried into
the enemy's country, newspaper opinion varied between the view that the
President was playing politics and that he was actuated by the highest
motives only. Agitation for reform, meanwhile, continued to increase.
The literary men among the reformers, aided by scores of lesser lights,
conducted a campaign of education; the New York Civil Service Reform
Association, founded in 1877, and the National Civil Service Reform
League, in 1881, gave evidence of an effort towards the organization of
reform sentiment.

While the attention of the President and the politicians was directed
toward the reform of the civil service, there occurred an event for
which none of them was prepared. Early in the summer of 1877 train hands
on the Baltimore and Ohio Railroad struck because of a reduction in
wages, the fourth cut that they had suffered in seven years. The strike
spread with the speed of a prairie fire over most of the northern roads
between New England and the Mississippi. At the height of the
controversy at least 100,000 strikers and six or seven thousand miles of
railway were involved, while at several points especially Martinsburg,
West Virginia, and Pittsburg, rioting and destruction took place. A
considerable number of people were killed or wounded, and the loss of
property in Pittsburg alone was estimated at five to ten millions of
dollars. Eventually, when the state militia failed to check the
disorder, the President was called upon for federal troops and these
proved effectual. That even so thoughtful and conscientious a man as
Hayes was far from understanding the meaning of the strike was indicated
in his message to Congress in which he merely expressed his
gratification that the troops had been able to repress the disorder.
Repression, that is to say, was the one resource that occurred to the
mind of the chief executive and to the majority of the men of his day.
That repression alone could not remedy evils permanently, that salutary
force ought to be immediately supplemented by a study of the rights and
wrongs of the two sides and by a dispassionate correction of
abuses,--all this did not even remotely occur to the thoughts of the
political leaders of the time.

The breach in the ranks of the Republicans which was made by the events
of the early days of the Hayes administration was closed in the face of
an attack by the common enemy--the Democrats. The latter, being in
control of the House, appointed the "Potter Committee" to investigate
the title of Hayes to the Presidency, hoping to discredit him and
thereby turn the tables in the election of 1880. The committee examined
witnesses and reported, the Democrats asserting that Tilden had been
elected and the Republicans that Hayes had been. The Republican Senate,
meanwhile, had prepared a counterblast. By legal proceedings a committee
had obtained from the Western Union Telegraph Company over thirty
thousand of the telegrams sent by both parties during the campaign. The
Republicans declared that the "cipher despatches" among these messages
showed that the Democrats had offered a substantial bribe for the vote
of an Oregon Republican elector. Before the dispatches were returned to
the telegraph company, somebody took the precaution to destroy those
that concerned Republican campaign methods and to retain those relating
to the Democrats. The latter were published by the New York _Tribune_
and revealed attempts to bribe the Florida and South Carolina Returning
Boards. Most of them had been sent by Tilden's nephew or received by
him, so that the corrupt trail seemed to lead straight to the candidate
himself, but the evidence was inconclusive. The Potter Committee then
investigated the telegrams, together with a great number of witnesses,
and another partisan report resulted. It thus appeared that both pot and
kettle were black and there the matter rested. The Democrats had done
themselves no good and had done the Republicans no harm.[5]

The Democrats also attacked the election laws, under which federal
officials supervised elections, and federal judges and marshals had
jurisdiction over cases concerning the suffrage. Under these laws, also,
troops could be used to enforce the judgments of the Courts. There is no
doubt that intimidation, unfair practices and bribery were all too
common in the North as well as in the South. The lack of official
ballots and secret voting made abuses inevitable. In New York,
Cincinnati and other northern cities, and on a smaller scale in the
rural districts, abuses of one sort or another were normal
accompaniments of elections. Intimidation in the South was notorious and
not denied. The existing election laws gave the dominant party an
opportunity to appoint large numbers of deputy-marshals--largely party
workers, of course-paying them from the national treasury and so
solidifying the party organization. In the election of 1876 about
$275,000 had been spent in this way. Some of the federal supervisors had
been extremely energetic--so much so that in one case in Louisiana their
registration lists showed 8,000 more colored voters in 1876 than were
discovered by the census enumerators four years later.

If the Republicans saw involved in the laws both a principle and a party
weapon, the Democrats saw both a principle and an opportunity. They
attached a "rider" to an army appropriation bill, which made it unlawful
to use any part of the army for any other than the purposes expressly
authorized by the Constitution or by act of Congress. Since the
Constitution allowed the use of troops only to "execute the laws of the
Union, to suppress Insurrections and repel Invasions," the new law would
prevent the employment of armed forces for civil purposes at the polling
places. The President was compelled to yield to save the appropriation
bill.

In the next Congress the Democrats controlled both House and Senate and
they advanced to the attack on the remainder of the election laws.
Attempts were made to prevent the appointment of special deputy-marshals
by forbidding the payment of any compensation to them or to the regular
marshals when used in elections. Each time that Congress passed such a
law the President vetoed it, even though special sessions had to be
called to make up for lost time. He saw in the use of the rider a
dangerous assertion of coercive power on the part of Congress. By means
of it, Congress was withholding funds essential for military and civil
purposes until the President should assent to legislation totally
unconnected with the appropriations. He felt himself being threatened
and driven by a hostile legislature. For the President to give way
before such constraint would be to lose the veto power and to destroy
the independence of the executive as a branch of the government. The
Democrats were unable to muster force enough to overrule the veto, and
here the matter rested while other forces, which have already been
described, were sapping the strength of the election laws. On the whole,
the result was probably to bring the Republican factions together and so
to strengthen the party for the election of 1880. The Democrats, on the
other hand, probably lost ground.

In the meanwhile a difficult and technical problem--the monetary
question--was forcing itself upon the attention of Congress and of the
country. The rapid development of the economic life of the United States
was demanding an increased volume of currency with which to perform the
multitude of exchanges which constantly take place in the life of an
industrial people. Unless the volume of the currency expanded
proportionately with the increase of business, or there was a
corresponding increase in the use of bank checks, the demand for money
would cause its value to go up--that is, prices to go down. If the
volume expanded more rapidly than was necessitated by business, the
value of money would fall and prices would go up. A change in the price
level in either direction, as has been seen, would harm important groups
of people. The exact amount, however, by which the volume should be
increased was not easy to determine. Furthermore, assuming that both
gold and silver should be coined, what amount of each would constitute
the most desirable combination? What ought to be the weight of the
coins? If paper currency was to supplement the precious metals, what
amount of it should be in circulation? These are difficult questions
under any circumstances. They did not become less so when answered by a
bulky and uninformed Congress acting under the influence of definite
personal, sectional and property interests.

Several facts tended to restrict the kind of money whose volume could be
greatly increased. It was not advisable to expand the greenbacks because
legislation had already limited their amount and because such action
would unfavorably affect the approaching resumption of specie payments.
The quantity of national bank notes, another common form of paper money,
was somewhat rigidly determined by the amount of federal bonds
outstanding, for the national bank notes were issued upon the federal
bonds as security. Moreover, the bonds were being rapidly paid off
during the seventies and it was, therefore, impossible to expect any
increase of the currency from this source. Normally the supply of gold
available for coinage did not vary greatly from year to year and
certainly did not respond with exactness to the demand of industry for a
greater or smaller volume of circulating medium. It seemed to remain for
silver to supply any needed increase.

But silver was not in common use except as a subsidiary coin. For many
years the value of the bullion necessary for coining a silver dollar had
been greater than the value of the coin. Nobody therefore brought his
silver to the mint but sold it instead in the commercial markets. Indeed
so insignificant was the amount of silver usually coined into dollars
that an act of 1873 systematizing the coinage laws had omitted the
silver dollar completely from the list of coins. The omission was later
referred to by the friends of silver currency as the "Crime of 1873." At
the same time a remarkable coincidence was providing the motive power
for the demand that silver be more largely used as currency. Early in
the seventies Germany and the Latin Monetary Union, (France,
Switzerland, Belgium, Italy and Greece), had reduced the amount of their
silver coinage, thus throwing a large supply of bullion on the market.
Simultaneously, enlarged supplies of silver were being found in western
United States. A Nevada mine, for example, which had produced six
hundred and forty-five thousand dollars' worth of ore in 1873 had turned
out nearly twenty-five times that amount two years later. Naturally the
market price of silver fell and the mine owners began to seek an outlet
for their product. Thus the people who were convinced that the volume of
the currency was insufficient for the industrial demands of the nation
received a new and powerful reenforcement from the producers of silver
ore. There arose what the New York _Tribune_ referred to as "The Cloud
in the West."

Inevitably the cloud in the West threw its shadow into Congress where
the demand was insistent that the government "do something for silver."
A commission had been appointed in 1876 to study the currency problem
and make recommendations. When the report was made it appeared that the
opinions of the members were so divergent that little was gained from
the investigation. While the commission was deliberating, Richard P.
Bland of Missouri introduced a bill providing for the free and unlimited
coinage of silver. Under its provisions the owner of silver bullion
could present any quantity of his commodity to the government to be
coined under the conditions which controlled the coinage of gold. The
House responded readily to Bland's proposal. In the Senate, under the
leadership of William B. Allison, the free and unlimited feature of the
bill was dropped and a provision adopted limiting the purchase of
bullion to an amount not greater than four million dollars' worth per
month and not less than two million dollars' worth. The bullion so
obtained was to be coined into silver dollars, which were to be legal
tender for all debts public and private. Bland was ready to accept the
compromise because he hoped to be able to increase the use of silver by
subsequent legislation. "If we cannot do that," he said, "I am in favor
of issuing paper money enough to stuff down the bond-holders until they
are sick." The remark was typical of the sectional and class hatreds and
misunderstandings which this debate aroused, and of the maze of
ignorance in which both sides were groping. To the silver faction, their
opponents were "mendacious hirelings" and "Gilded Shylocks." God, in His
infinite wisdom had imbedded silver in the western mountains for a
beneficent purpose. "The country," said one speaker, "is in an agony of
business distress and looks for some relief by a gradual increase of the
currency." On the other hand, the opponents of silver scorned the
"delusion" of a "clipped" coin and the dishonest proposition to make
ninety cents' worth of silver pass as a dollar. The "storm-driven,
buffeted, and scarred" ship of industrial peace, an easterner declared,
"deeply laden with all precious and golden treasure is sighted in the
offing!... shall we put out the lights?... Dare we remove the ship's
helm, leaving her crippled and helpless!"

Sherman believed that this limited amount of silver could be taken into
the currency system without difficulty, but President Hayes thought that
harm would result from making the silver dollar a legal tender when the
market value of the bullion in the coin was not equal in value to that
of the gold dollar. He therefore vetoed the bill on February 28, 1878.
He could not carry Congress with him, however, and the measure was
passed over the veto on the same day.

Party lines had disappeared during the debates over the passage of the
act. Eastern members of both houses and of both parties had been
opposed, with few exceptions, to the increased use of silver; the
westerners had been equally united in its favor. The East, the creditor
section and the holder of most of the Civil War bonds, had no desire to
try an experiment with the currency which would, in their opinion,
reduce the purchasing power of their income. The debtor West looked with
disfavor upon an increase in the real amount of their debts which was
brought about by an inadequate supply of currency. Since prices
continued to decline they believed that the remedy was a greater
quantity of money. Evidently the greenback controversy was reviving in a
new garb.

The approach of the resumption of specie payments which had been set, it
will be remembered, for January 1, 1879, increased the burden under
which the westerners and the debtor classes in general were working.
Favorable commercial conditions and Sherman's foresight, tact and
intelligence made it possible to overcome the various difficulties in
the way of accumulating a sufficient reserve of gold, and on December
31, 1878, the Treasury had on hand about $140,000,000 of the precious
metal, an amount nearly equal to forty per cent. of the paper in
circulation. Despite the desirability of resumption, the first effects
of preparations for it were harmful to considerable bodies of people. As
January 1 approached, the greenbacks, which had been circulating at a
depreciated value, rose nearer and nearer to par. Debts which had been
incurred when paper dollars were worth sixty cents in gold, had to be
paid in dollars worth eighty, ninety or a hundred cents, according to
the date when the debt fell due. Business men who were heavily in debt
and farmers whose property was mortgaged found their burden daily
growing in size.

Notwithstanding the steady advance of paper toward par value, Sherman
nervously awaited business hours on January 2, 1879, (since the first
fell on Sunday) to see whether there would be such a rush of holders of
paper who would wish gold that his slender stock would be wiped out. New
York, the financial center, was watched with especial anxiety. To
Sherman's surprise, only $135,000 of paper was presented for redemption
in gold; to his amazement and relief, $400,000 in gold was presented in
exchange for paper. Evidently, now that paper and metal were
interchangeable, people preferred the lighter and more convenient
medium. Favorable business conditions enabled the government to continue
specie payments; a huge grain crop in 1879, coupled with crop failures
in England, caused unprecedented exports of wheat, corn and other
products, and a corresponding importation of gold. The damage resulting
from the appreciation of paper was temporary in character; the public
credit was vastly benefited; and the greater amount of stability in the
value of paper proved invaluable to industry.

Happily Hayes's stormy political relations were balanced by comparative
quiet in foreign affairs. Only Mexico caused trouble, and that was of
negligible importance. A few raiders made sporadic excursions into
Texas, which necessitated an expedition for the punishment of the
marauders. General Ord was directed to cross the border if necessary,
but General Diaz, at the head of the Mexican government, concluded an
agreement for cooperation with the United States in the protection of
the boundary. The agreement was only partly successful, however, and on
several occasions troops crossed the Rio Grande and fought with bandits.

On the Pacific Coast, meanwhile, the Chinese question was becoming a
political issue. In earlier times the immigration of the Chinese had
been encouraged because of the need of a cheap labor supply when the
transcontinental railroads were being built. As the coast filled up,
however, with native population, and the demand for laborers fell off,
there arose numerous objections to the oriental. It was seen that since
he was willing to work for extremely low wages he could drive American
laborers out of their places. Labor leaders such as Dennis Kearney held
meetings on the "sand lots" in San Francisco and aroused anti-Chinese
feeling. Riots and violence, even, were not unknown.

Just before the inauguration of President Hayes a commission of inquiry
had visited the coast and examined many witnesses. The commission
reported that the resources of the Pacific states had been more rapidly
developed with coolie labor than they would otherwise have been, but
that the Chinese lived under filthy conditions, formed an inferior
foreign element and were, on the whole, undesirable. It recommended that
the executive take steps in the direction of a modification of the
existing treaty with China, for fear that the problem might spread
eastward with increasing immigration. The electioneering possibilities
of the subject had appealed to both parties and they had earnestly
demanded action in their platforms of 1876. Opinion was forming
throughout the country, aided by Bret Harte's famous lines:

    Which I wish to remark
    And my language is plain,
    That for ways that are dark
    And tricks that are vain,
    The heathen Chinee is peculiar
    Which the same I would rise to explain.

Action by Congress was hindered by the Burlingame treaty of 1868 with
China, which covered the subject of immigration in unmistakable
language. By its provisions citizens of China were to have the same
rights of travel and residence in America as the subjects of the most
favored nation. Reciprocally, China was to grant equal privileges to
citizens of the United States. The process of modifying a treaty through
the ordinary diplomatic channels was so slow that Congress sought to
avoid delay by passing a law forbidding shipmasters to bring in more
than fifteen Chinese at one time, and calling upon the President to
notify China that the terms of the Burlingame treaty, in so far as they
related to immigration, would not hold after July 1, 1879, when the
proposed legislation would take effect. President Hayes sympathized with
the purpose of the bill but felt obliged to veto it because of the
Burlingame treaty. The veto message recalled that the treaty had been of
American seeking and that its ratification had been applauded all over
the country. The abrogation of part of the agreement would be equivalent
to abrogation of the whole, leaving American citizens in China without
adequate treaty protection. Furthermore Hayes felt that treaties could
not rightfully be violated by legislation, but advocated other measures
for the relief of the people of the Pacific Coast. He thereupon sent to
China a commission, headed by James B. Angell of Michigan, which
succeeded in liberally modifying the existing treaty. Under the new
arrangement the United States might "regulate, limit, or suspend" the
immigration of Chinese laborers; and as the treaty was promptly
ratified, it redounded somewhat to the credit of the Republicans in the
election of 1880.

The administration of Hayes was, on the whole, an admirable one. The
problems which he faced were varied and difficult, but most of them were
met sensibly and with success. To be sure, he did not grasp the social
and economic forces behind the monetary agitation; nor did he have the
insight and originality necessary for attacking the problem of industrial
unrest as it appeared in the strike of 1877. But neither did his
associates, nor his successors in the presidency for many years to
come. On the other hand, the ethical standards of the administration
were high and the atmosphere of the White House sane and wholesome. The
home life of the President was exceptionally attractive, for Mrs. Hayes
was a woman of unusual charm and social capacity. The attitude of Hayes
on the southern question and on civil service reform was courageous and
progressive. And most of all, his ideas on public questions were stated
with unmistakable clearness in a day when old issues were sinking into
the background and both parties were reluctant to define their position
on the new ones.


BIBLIOGRAPHICAL NOTE

A great contribution to the understanding of Hayes's administration was
made by the publication of C.R. Williams, _Life of Rutherford B. Hayes_
(2 vols., 1914). It is complete and contains copious extracts from
Hayes's diary, but is written with less of the critical spirit than is
desirable; J.F. Rhodes has a valuable chapter in his _Historical Essays_
(1909); J.W. Burgess, _Administration of R.B. Hayes_ (1916), is a
eulogy; V.L. Shores, _Hayes-Conkling Controversy_ (1919), describes the
civil service quarrel; J.R. Commons and others, _History of Labor in the
United States_ (2 vols., 1918), describes the strike of 1877; so also
does J.F. Rhodes, _History of the United States from Hayes to McKinley_
(1919), with full references. On the Chinese affair, consult Mrs. M.E.
B.S. Coolidge, _Chinese Immigration_ (1909). Most of the general
histories already mentioned dwell at length on the Hayes administration.

For the official messages of this and succeeding administrations, the
most convenient source is J.D. Richardson, _Messages and Papers of the
Presidents_ (10 vols., 1903).

       *       *       *       *       *

[1] For a time public interest was absorbed by the determination of
President and Mrs. Hayes to serve no wines of any kind in the White
House. Finally a delicious frozen punch was served at about the middle
of the state dinners, known to the thirsty as "the Life-saving Station."
It was popularly understood to be liberally strengthened with old Santa
Croix rum, but the President later asserted that he had caused the punch
to be sharpened with the flavor of Jamaica rum and that no drop of
spirits was inserted. What the _chef_ really did, perhaps nobody knows.
At any rate, both sides were satisfied. Williams, _R.B. Hayes_, II; 312
note.

[2] Because March 4 fell on Sunday, the oath of office was privately
administered to Hayes on Saturday evening, March 3. Williams, _Hayes_,
II, 5.

[3] George W. McCrary was Secretary of War; Richard W. Thompson,
Secretary of the Navy; Charles Devens, Attorney-General.

[4] Chamberlain, the Republican claimant in South Carolina, wrote in
1901 that he was "quite ready now to say that he feels sure that there
was no possibility of securing permanent good government in South
Carolina through Republican influences." _Atlantic Monthly_, LXXXVII,
482.

[5] Many of the dispatches were in a complicated cipher which resisted
all attempts at solution. The _Tribune_ published samples from time
to time, keeping interest alive in the hope that somebody might solve
the riddle. Finally two members of the _Tribune_ staff were successful
in discovering the key to the cipher in a way that recalls the
paper-covered detective story. The newspaper aroused and excited public
interest by publishing specimens and eventually achieved a sensation by
putting the most damaging material into print on October 16, 1878. One
of the telegrams, with its translation, ran as follows:

    "Absolutely Petersburg can procured by Copenhagen may Thomas
    prompt Edinburgh must if river take be you less London Thames
    will."

    Translation: If Returning Board can be procured absolutely, will
    you deposit 30,000 dollars? May take less. Must be prompt. Thomas.




CHAPTER VII


THE POLITICS OF THE EARLY EIGHTIES

The Hayes administration was scarcely half over when the politicians
began to look forward to the election of 1880. At the outset of his
term, Hayes had advocated a single term for the executive and there was
no widespread movement among the politicians to influence him to change
his attitude. His enemies, indeed, had already turned to General Grant.
There had been a third-term boom for the General during his second
administration and he had indicated that he was not formidably opposed
to further continuance in office. Suddenly, however, the anti-third-term
feeling had risen to impressive proportions, whereupon the House of
Representatives had adopted a resolution which characterized any
departure from the two-term precedent as "unwise, unpatriotic, and
fraught with peril to our free institutions." As the resolution passed
by an overwhelming vote--233-18--nothing further was heard of a
third-term boom.

The Hayes administration put a different complexion on the matter. The
wheel-horses of the party were not enthusiastic over the President or
his policies, and in their extremity they looked to Grant. The New York
State Republican Convention, under control of Roscoe Conkling and his
forces, instructed delegates to support the General as a candidate for
the nomination and endeavored to forestall opposition to a third term.
It declared that the objection to a third presidential term applied only
to a third consecutive term and hence was inapplicable to the
re-election of Grant. Grant, meanwhile, presented a spectacle that was
at once humorous and pathetic. He had not expected, on leaving the
presidency, to return to power again, had dropped consideration of the
political future and had given himself up to the enjoyment of foreign
travel. The royal reception accorded him wherever he went suggested to
his political supporters that they utilize his popularity. It was
foreseen that when he returned to America he would receive a tremendous
ovation, on the wave of which he might be carried into office. He was
flooded with advice and entreaties that he act in accordance with this
plan. His family was eager to return to the position of social eminence
which they had occupied, and pressure from them was incessant. At first
he did nothing either to aid or to hinder the boom, then gave way to the
pressure and at last became extremely anxious to obtain the coveted
prize.

If the politicians did, in truth, desire a relaxation from the patronage
standards of the Hayes regime, they did not make that the ostensible
purpose of their campaign. They argued that the times demanded a strong
man; that foreign travel had greatly broadened the General and given him
a knowledge of other forms of government; that he had been great as a
commander of armies, greater as a President, and that as a citizen of
the Republic he "shone with a luster that challenged the admiration of
the world." Behind him were Conkling and Platt, with the New York state
organization under their control, Don Cameron who held Pennsylvania in
his hand, General Logan, strong in Illinois, and lesser leaders who
wielded much power in smaller states. Many business men were ready to
lend their aid; the powerful Methodist Church, to which he belonged, was
favorable to him; and, of course, his popularity as a military leader
was unbounded. His return to the United States while the enthusiasm was
at its height was the signal for an unprecedented ovation. The opponents
of a third term painted in high colors the danger of a revival of the
scandals of Grant's days in the presidential chair, formed "No Third
Term" leagues, called an "Anti-Third-Term" convention and decried the
danger of continuing a military man in civil office. _The Nation_
scoffed at the educational effect of foreign travel on a man who was
fifty-seven years of age and could understand the language in only one
of the countries in which he travelled. A large fraction of the
Republican press, in fact, was in opposition. "Anything to beat Grant"
and "No third term" were their war-cries. Nor was there any lack of
Republican candidates to oppose the Grant movement and to give promise
of a lively nominating convention. Blaine's popularity was as widespread
as ever. Those who feared the nomination of either Grant or Blaine
favored Senator George F. Edmunds of Vermont or Secretary Sherman. Both
of these men were of statesmanlike proportions, but Edmunds was never
widely popular and Sherman was lacking in the arts of the
politician--"the human icicle," T.C. Platt called him.

The Republican nominating convention of 1880 met in Chicago in a
building described as "one of the most splendid barns" ever built. This
convention is unusually worthy of study because it involved most of the
elements which entered into American politics in the early eighties. It
was long memorable as making a record for that form of enthusiasm which
bursts into demonstrations. "Great applause," "loud laughter," "cheers"
and "hisses long and furious" dot the newspaper accounts of its
deliberations. The members "acted like so many Bedlamites," one of the
delegates said. On one day the opening prayer was so unexpectedly short
that there was applause and laughter. The keen contest for the
nomination resulted in galleries packed with supporters of the several
candidates, who cheered furiously as their favorite delegates appeared.
As the galleries came down nearly to the level of the floor, the
spectators were almost as much members of the convention as the
delegates themselves. It was under such conditions, then, that the
convention proceeded to the serious business of adopting principles and
choosing a leader.

Three hundred and six of the 757 delegates were sworn supporters of
Grant--pledged to die, if they died at all, "with their boots on," one
of their leaders said. In each of the big delegations--those from New
York, Pennsylvania and Illinois--a minority was unfavorable to Grant.
This minority could be counted in the General's column if the convention
could be forced to adopt the so-called "unit-rule," under which the
delegation from a state casts all its votes for the candidate favored by
the majority. In this particular case, the minorities in New York,
Pennsylvania and Illinois numbered more than sixty delegates, so that
the adoption of the rule was a stake worth playing for. The plan
formulated by the Grant leaders was worthy of the time.

Donald Cameron of Pennsylvania was chairman of the National Republican
Committee. Following the usual custom, Cameron was to call the
convention to order and present the temporary chairman who had been
chosen by the Committee. As the Grant supporters were in a minority even
on the Committee, provision was made to meet the emergency in case the
majority insisted on the appointment of an anti-Grant chairman. Cameron
was to announce the name, a Grant delegate was to move to substitute a
Grant man instead, and Cameron would enforce the unit-rule in the
resulting ballot. This would ensure control of the organization of the
convention and, doubtless, of the nomination of the candidate.

Unhappily for this well-laid plan, rumor of it leaked out, and the
majority of the National Committee--opposed to Grant--conveyed
information to Cameron that he must agree to give up such a scheme or be
ousted from his position. Cameron, convinced that his enemies were
determined, gave up his project, and Senator George F. Hoar, who favored
neither Grant nor Blaine, was made temporary and later permanent
chairman.

Although defeated in the first skirmish, the Grant forces pressed
forward for renewed conflict. Conkling presented a resolution that every
member of the convention be bound in honor to support the eventual
candidate, whoever he might be. The resolution passed 716 to three; and
he then moved that the three who had voted in the negative had thereby
forfeited their votes in the convention. James A. Garfield of Ohio led
the opposition to such rough-shod action and Conkling angrily withdrew
his resolution amid hisses. When Garfield reported from the Committee on
Rules in regard to the regulations under which the convention should
deliberate, he moved that the unit rule be not adopted and the
convention upheld him. It was manifest that the delegates were not in a
mood to surrender to a junto of powerful machine politicians.

The way having been now cleared for action, the convention adopted a
platform. This was composed largely of a summary of the achievements of
the party and denunciation of the opposition. Most of the planks were
abstract or perfunctory, or expressed in such a way as not to commit the
party seriously. _Harper's Weekly_, a Republican periodical, regretted
the character of the platform and remarked that such documents are
expected to say

    An undisputed thing
    In such a solemn way.

Judged by this criterion, the platform was ideal. The obligations of the
country to the veterans were emphasized and the restriction of Chinese
immigration called for. On the tariff, the only utterance was an avowal
that duties levied for the purposes of revenue should discriminate in
favor of labor. After this declaration of faith had been unanimously
adopted, a Massachusetts delegate presented an additional plank
advocating civil service reform.

The convention was now badly put to it. To reject a plank which had been
accepted both in 1872 and in 1876 would discredit the party,
particularly as the platform just adopted had accused the opposition of
sacrificing patriotism "to a supreme and insatiable lust for office."
Nevertheless the opposition to its adoption was formidable, and it had
already been twice rejected in the Committee on Resolutions, which drew
up the platform. There seemed no way of avoiding the issue, however, and
the plank was thereupon adopted, though not before Webster Flanagan of
Texas had blurted out, "After we have won the race ... we will give
those who are entitled to positions office. What are we up here for?"

With the speeches presenting candidates to the convention, the real
business of the week began. Senator Conkling aroused a tempest of
enthusiasm for General Grant in a famous speech which began with the
lines,

    When asked what state he hails from,
      Our sole reply shall be,
    He comes from Appomattox
      And its famous apple tree.

Garfield presented Sherman's name. At the outset General Grant led,
Blame was a close second and Sherman third. This order continued for
thirty-five ballots. By that time Blaine and Grant had fought each other
to a standstill. The General's three hundred and six held together
without a break, and Blaine's forces were equally determined.[1]

There was little chance of compromise, as Grant and Blaine were not on
speaking terms, and Conkling and Blaine looked upon each other with
unconcealed hatred. Since Sherman was handicapped by lack of united
support in his own state, the natural solution of the problem seemed to
be the choice of some other leader who might harmonize the contending
factions. On the thirty-fourth ballot, seventeen votes were given to
Garfield; on the next, fifty; then a stampede began, in spite of a
protest by Garfield, and on the thirty-sixth ballot a union of the
Blaine and Sherman forces made him the choice of the convention. The
nominee for the vice-presidency was Chester A. Arthur, who was one of
the leading supporters of Grant and a member of the Conkling group.

The choice of Garfield was well received by the country, perhaps the
more so as a relief from the danger of a third term. The nominee was a
man of great industry, possessed of a store of information, tactful,
modest, popular, an effective orator, and a veteran of the war. His
rise from canal boy to candidate for the presidency exemplified the
possibilities before industrious youth and gave rise to many a homily
on democratic America. Yet his friends had to defend his relation to a
paving scandal in the District of Columbia and an unwise connection with
the Credit Mobilier of 1873. In neither of these cases does Garfield
seem to have been corrupt, but in neither does he appear in a highly
favorable light.[2]

As the Republicans were dispersing, the Greenback convention was
assembling. Their strength in the campaign was almost negligible but
their platform presaged the future. Money to be issued only by the
government, the volume of money increased, ameliorative labor
legislation, restriction of Chinese immigration, regulation of
interstate commerce, an income tax, government for the people rather
than for classes, wider suffrage,--all these were advocated in concise
and unmistakable terms. James B. Weaver was the presidential candidate.

Among the Democrats, the all important question was whether Tilden would
be a candidate again. He naturally wished for a renomination and an
opportunity to prove by an election that he had been "fraudulently"
deprived of the presidency in 1876. The party, likewise, seemed to need
his services, as no other leader of equal prominence had appeared. On
the other hand, his health had rapidly failed since 1876 and it was
apparent that he was unequal to the exacting labors of the presidency.
Not until just before the meeting of the convention, however, did he
make known his wishes and then he declared that he desired nothing so
much as an honorable discharge from public service and that he
"renounced" the renomination. The party took him at his word and turned
to the adoption of a platform and the choice of another leader.

The platform reflected the bitterness of the party over the "great
fraud" of 1876-1877 and advocated tariff for revenue only, civil service
reform and the restriction of Chinese immigration. In other words,
except for the usual self-congratulation and the denunciation of the
opposition, the Democratic platform closely resembled that of the
Republicans. The convention then nominated for the presidency General
Winfield S. Hancock, a modest, brave Union soldier, of whom Grant once
said, "his name was never mentioned as having committed in battle a
blunder for which he was responsible." He was not an experienced
politician, but was popular even in the South.

On the whole the Democratic convention was much less interesting than
its Republican predecessor. There were no fierce factional quarrels to
arouse the emotions to concert pitch. The applause spurted out here and
there like the "jets from a splitting hose" in the "Ki yi yi yi" which
characterized the cheers of the lower wards of New York, in contrast to
the rolling billows of applause which formed so memorable an element in
the opposition gathering. The New York Tribune, although hostile to
everything Democratic, perhaps stated the fact when it commented on the
lack of enthusiasm. The convention, the Tribune noted, was well-behaved,
but a mob without leaders; there were no Conklings or Garfields or
Logans, only John Kelleys and Wade Hamptons.

The campaign of 1880 reflected the lack of definite utterances in the
party platforms. Since each side was loath to press forward to the
solution of any real problem facing the nation, the campaign was
confined, for the most part, to petty or even corrupt partisanship. The
career of General Garfield was carefully overhauled for evidences of
scandal. Arthur's failings as a public officer were duly paraded.
General Hancock was ridiculed as "a good man weighing two hundred and
forty pounds." Some attempt was made by the Republicans to make an issue
of the tariff, and a remark of Hancock to the effect that the tariff was
a "local issue" was jeered at as proving an ignorance of public
questions. There was little response to the "bloody shirt" and little
interest in "the great fraud." A modicum of enthusiasm was injected into
the canvass by the participation of Conkling and General Grant. The
former was not happily disposed toward the Republican candidate and
Grant had always refused to make campaign speeches, but as the autumn
came on and defeat seemed imminent, these two leaders were prevailed
upon to lend their assistance. Near the end of the campaign a letter was
circulated in the Pacific states, purporting to have been written by
Garfield to a Mr. Morey, and expressing opposition to the restriction of
Chinese immigration. The signature was a forgery, but complete exposure
in the short time before election day was impossible and the letter
perhaps injured Garfield on the coast. Nevertheless Garfield and Arthur
won, although their popular plurality was only 9,500 in a total of about
nine millions. The electoral vote was 214 to 155 and showed that the
division among the states was sectional, for in the North Hancock
carried only New Jersey, together with Nevada and five electoral votes
in California, the result probably of the Morey letter.

Two aspects of the campaign had especial significance. The attempt by
Conkling and his associates to choose the Republican nominee through the
shrewd manipulation of political machinery, and against the wishes of
the rank and file of the party, was a move on the part of the greater
state bosses to get control of the national organization, so that they
might manage it as they managed their local committees and conventions.
The second notable circumstance concerned the collection and expenditure
of the campaign funds.

Even before the convention met, the Republican Congressional Committee,
pursuing the common practice of the time, addressed a letter to all
federal employees, except heads of departments, in which the suggestion
was made that the office holders would doubtless consider it a
"privilege and a pleasure" to contribute to the campaign funds an amount
equal to two per cent. of their salaries. The Republican National
Committee also made its demands on office holders--usually five per
cent. of a year's salary. The Democrats, having no hold on the federal
offices, had to content themselves with the cultivation of the
possibilities in states which they controlled. In New York, Senator
Platt was chairman of the executive committee and he sent a similar
communication to federal employees in the state. Even the office boy in
a rural post office was not overlooked, and when contributions were not
forthcoming, the names of delinquents were sent to their superiors.
Other developments appeared after the election was over. In February,
1881, a dinner was given in honor of Senator S.W. Dorsey, secretary of
the Republican National Committee, to whom credit was given for carrying
the state of Indiana. General Grant presided and grace was asked by
Reverend Henry Ward Beecher. Dorsey was an Arkansas carpet-bagger, who
had been connected with a railroad swindle and was soon, as it turned
out, to be indicted for complication in other frauds. The substance of
the speeches was that the prospect of success in the campaign seemed
waning, that Indiana was essential to success and that Dorsey was the
agent who accomplished the task. Arthur, who was one of the speakers,
explained the _modus operandi_: "Indiana was really, I suppose, a
Democratic State. It had been put down on the books always as a State
that might be carried by close and perfect organization and a great deal
of--(laughter). I see the reporters are present, therefore I will simply
say that everybody showed a great deal of interest in the occasion and
distributed tracts and political documents all through the State."

With the victory accomplished, the politicians turned from the contest
with the common enemy to the question of the division of the spoils;
from the ostensible issue of platforms, to the real issue that Flanagan
had personified. Although the Republicans had presented a united front
to their opponents, there were factional troubles within the party that
all but dwarfed the larger contest. The "Stalwarts" were composed of the
thorough "organization men" like Conkling, Platt and Arthur; the
"Half-breeds" were anti-organization men and more sympathetic with the
administration. The commander of the Stalwarts and one of the most
influential leaders in the country was Roscoe Conkling, Senator from New
York. In person Conkling was a tall, handsome, imperious man, with
something of the theatrical in his appearance and manner. As a
politician he was aggressive, fearless, scornful, shrewd and adroit when
he chose to be, and masterful, always. As an orator he knew how to play
on the feelings of the crowd; his vocabulary, when he turned upon one
whom he disliked, was memorable for its wealth of invective and
ridicule, and especially he uncorked the vials of his wrath on any who
were not strictly organization men. Although an able man and a
successful lawyer, Conkling seems to have had less interest in the
public welfare than in conventions, elections and patronage.

The announcement of Garfield's choice of a Cabinet was the signal for a
fierce patronage fight. James G. Blaine, the choice for Secretary of
State, was distasteful in the extreme to Conkling. Many years before,
during a debate in the House, Blaine had compared Conkling to Henry
Winter Davis as

    Hyperion to a satyr, Thersites to Hercules, mud to marble,
    dunghill to diamond, a singed cat to a Bengal tiger, a whining
    puppy to a roaring lion.

He had contemptuously referred to Conkling's "haughty disdain, his
grandiloquent swell, his majestic, supereminent, overpowering,
turkey-gobbler strut." Accordingly when Garfield disregarded Conkling's
wishes in regard to the representation which New York should have in the
cabinet, Conkling laid the blame upon his old enemy.[3]

As soon as the administration was in office, the Senate met in executive
session to act on appointments, and it appeared that the parties were
evenly divided, the balance of power lying in the hands of two
Independents. President Garfield sent in his list of nominees for office
without consulting Conkling in regard to New York appointments. Among
them was William H. Robertson for the coveted position of collector for
the port of New York. As Robertson had been opposed to Grant and to the
unit rule in the Republican convention, Conkling's rage reached a fever
pitch. In an attempt to discredit the President before the country, he
made public a letter from Garfield giving countenance to the practice of
levying campaign assessments on federal employees. Conkling's point of
view is not difficult to understand. Consultation with the senators from
a state with regard to nominations to offices within its boundaries was
the common custom; Conkling had sunk his dislike of Garfield during the
campaign in order to assist in a party victory; moreover, he and Platt,
the other New York senator, understood that Garfield had agreed to
dispense New York patronage in conformity to the wishes of the
Stalwarts, in case Conkling took the stump. He had carried out his part
of the bargain and now desired his _quid pro quo_.

Meanwhile the Senate was trying to organize and having failed because of
the even division of the parties, stopped the attempt long enough to act
on the nominations. The President then withdrew all except that of
Robertson, thus indicating that offices in which other senators were
concerned would not be filled until the New York case was settled.
Foreseeing that the members would wish to clear the way for their own
interests and that Robertson's nomination was likely to be agreed to,
Conkling and Platt resigned their posts and appealed to the New York
legislature for a re-election as a vindication of the stand they had
taken. As the legislature was Republican and as Vice-President Arthur
went to Albany to urge their case, they seemed likely to succeed; but to
their mortification they were both defeated after an extended contest,
and Conkling retired permanently to private life. Platt, who was
promptly dubbed "Me Too," also relinquished public office, but only for
a time. In the meanwhile, as soon as Conkling and Platt had left the
Senate, the nomination of Robertson had been approved, and Garfield was
triumphant.

Further light was thrown upon political conditions by the investigations
of the "star routes." These were routes in the South and West where
mails had to be carried by stage lines, and were under the control of
the Second Assistant Postmaster-General, Thomas J. Brady. Rumors had
been common for some years that they were a source of corruption.
Garfield's Postmaster-General, Thomas L. James, had already made a
reputation as the reform postmaster of New York, and he set himself
to investigate the reports. Among other things it was discovered that a
combination of public men and contractors had succeeded in raising the
compensation on 134 star routes from $143,169 to $622,808, dividing the
extra profits among themselves. Brady and Senator Dorsey, the active
agent in the campaign in Indiana, were accused of being in the "ring"
and were indicted on the ground of conspiracy to defraud the government.
Brady attempted to block the investigation by threatening Garfield with
an exposure of the campaign methods, and when the threat failed he made
public a letter from the President to "My dear Hubbell," chairman of the
Congressional Committee, similar to that which Conkling had earlier
published. The trials of the conspirators dragged on until 1883 and
resulted in the acquittal of all the accused except one of the least
important. Yet some good was accomplished, for the ring was broken up.
Dorsey retired from public life, and renewed attention was drawn to the
need of better federal officials.

During the course of the trials, the country was shocked by the
assassination of the President on July 2, 1881, at the hands of a
disappointed office seeker named Guiteau. Despite a strong constitution
Garfield grew slowly weaker and died on September 19. The catastrophe
affected the country the more profoundly because of its connection with
the factional quarrel in the Republican party and because, following the
recent murder of the Russian Czar, it seemed to show that democratic
government was no guarantee against violence.[4]

The consternation with which the elevation of Chester A. Arthur to the
presidency was received was not confined to the Democrats. An
oft-repeated remark made at the time was expressive of the opinion of
those best acquainted with the new executive: "'Chet' Arthur President
of the United States! Good God!" In truth Arthur's previous career
hardly justified anything except consternation. He had been identified
always with machine politics and particularly with the Conkling group;
he had been a prominent figure in the opposition to Hayes when the
latter attempted to improve conditions in the New York Customs House;
and had taken an active and undignified share in the quarrel between
Garfield and Conkling. Chester A. Arthur, however, was a combination of
characteristics such as enlist the interest of the student of human
nature. Of Vermont birth, educated at Union College where he had taken
high rank, he had taught school for a time, had entered the practice of
law in New York, had made a good war record, and had been a member of
the Republican party from its beginning. In many ways Arthur was made
for politics. He was the "man of the world" in appearance, polished,
refined, well-groomed, scrupulously careful about his attire, a
_bon-vivant_. Yet he was equally at home in the atmosphere of politics
in the early eighties; a leader of the "Johnnies" and "Jakes," the
"Barneys" and "Mikes" of New York City. Dignity characterized him,
whether in the "knock-down" and "drag-out" caucus or at an exclusive
White House reception. He possessed a refinement, especially in his home
life, that is not usually associated with ward politics but which forms
an element of the "gentleman" in the best sense of that abused word.

Yet they who feared that President Arthur would be like Chester A.
Arthur, the collector of the port, were treated to a revelation. The
suddenness with which the elevation to the responsibility of the
executive's position broadened the view of the President proved that he
possessed qualities which had been merely hidden in the pursuit of
ordinary partisan politics. Platt, expectant of the dismissal of
Robertson, now that a Stalwart was in power, fell back in disgust and
disowned his former associate, for it appeared that Arthur intended to
further the principles of reform. His first annual message to Congress
contained a sane discussion of the civil service and the needed
remedies, which committed him whole-heartedly to the competitive system.
Although he did not go as far as some reformers would have had him, he
went so much farther than was expected that commendation was
enthusiastic, even on the part of the most prominent leaders in the
reform element. In the same message he urged the repeal of the
Bland-Allison silver-coinage act, the reduction of the internal revenue,
revision of the tariff, a better navy, post-office savings banks, and
enlightened Indian legislation. Altogether it was clear that he had laid
aside much of the partisan in succeeding to his high office.[5]

The Chinese problem soon provided him with an opportunity to show an
independence of judgment, together with an indifference to mere
popularity, which were in keeping with the new Arthur, but which were a
surprise to his former associates. As a result of the changes in the
Burlingame treaty, which gave the United States authority to suspend the
immigration of Chinese laborers, Congress passed a bill in 1882 to
prohibit the incoming of laborers for twenty years, western Republicans
joining with the Democrats in its passage.[6] Arthur vetoed the measure
on the ground that a stoppage for so great a period as twenty years
violated those provisions of the treaty which allowed us merely to
suspend immigration, not to prohibit it. An attempt to overcome the veto
failed for lack of the necessary two-thirds majority. Congress did,
however, pass legislation suspending the immigration of laborers for ten
years, and this bill the President signed. Later acts have merely
extended this law or made it more effective.

Arthur also exercised the veto upon a rivers and harbors bill. It had,
of course, long been the custom for the federal government to aid in the
improvement of the harbors and internal water-ways of the country. But
the modest sums of _ante-bellum_ days grew rapidly after the war,
stimulated by immense federal revenues, until the suggested legislation
of 1882 appropriated nearly nineteen million dollars. It provided not
merely for the dredging of great rivers like the Mississippi and Ohio,
but also for the Lamprey River in New Hampshire, the Waccemaw in North
Carolina, together with Goose Rapids and Cheesequake Creek. Some of
these, the opposition declared, might better be paved than dredged.[7]
It might seem that a bill against which such obvious objections could be
raised would be doomed to failure. But the argument of Ransom of North
Carolina, who had charge of the bill in its later stages in the Senate,
seems to have been a decisive one. Somebody had objected that the
members of the committee had cared for the interests of their own
states, merely. Ransom repelled the charge. He showed that the New
England states had been looked out for; "Look next to New York, that
great, grand, magnificent State ... that empire in itself ... Go to
Delaware, little, glorious Delaware." The committee had retained $20,000
for Delaware. "Go next ... to great, grand old Virginia." Virginia had
received something. "Go to Missouri, the young, beautiful, growing,
powerful State of my friend over the way." And so on--all had been
treated with thoughtful care. Ransom was wise in his day and generation.
Although Arthur objected to the bill on the grounds of extravagance and
of the official demoralization which accompanied it, nevertheless
Republicans and Democrats alike joined in passing over the veto an act
which would get money into their home states.

The congressional elections in the fall of 1882 indicated that the
factional disputes among the Republicans, and their failure to reform
conditions in the civil service had presented the opposition with an
opportunity. In the House of Representatives, Republican control was
replaced by a Democratic majority of sixty-nine; the state legislatures
chosen were Democratic in such numbers as to make sure the even division
of the Senate when new members were elected; in Pennsylvania, a
Democratic reformer, Robert E. Pattison, was elected governor, and in
New York another, Grover Cleveland, was successful by the unprecedented
majority of 190,000.

The results of the campaign added interest to a civil service reform
bill which had been drafted by some reformers led by Dorman B. Eaton,
and which had been presented to the Senate by George F. Pendleton, of
Ohio. The debate elicited several points of view. Pendleton set forth
the evils of the existing system of appointments, and emphasized the
superior advantages of appointment after competitive examination. The
Democrats were in distress. Although Pendleton was himself a Democrat
and the party platforms had been advocating reform, nevertheless the
election of 1884 was not far ahead, Democratic success seemed likely,
and the party leaders desired an unrestrained opportunity to fill the
offices with their followers. Senator Williams expressed a conviction
that the Republican party was a party of corruption and continued:

    The only way to reform is to put a good honest Democratic
    president in in 1884; then turn on the hose and give him a
    good hickory broom and tell him to sweep the dirt away.

The Republicans, on their side, were fearful of the same clean sweep
that Williams hoped for, and they therefore looked with greater
equanimity upon a bill which might retain in office the existing
office-holders, most of whom belonged to their party. This aspect of the
situation was not lost upon such Democrats as Senator Brown who moved
that the measure be entitled "a bill to perpetuate in office the
Republicans who now hold the patronage of the government." In the Senate
only five members voted against its passage, but thirty-three absented
themselves; and in the House forty-seven opposed, while eighty-seven
were absent. A little study of the debate makes it clear that the
passage of the act was due to conviction in favor of reform on the part
of a few and to fear of public opinion on the part of many others.
Undoubtedly many of the absentees were members who would not vote for
the measure and were fearful of the results of voting against it. The
President signed the bill January 16, 1883.

The Pendleton act left large discretion in the hands of the President.
It authorized the appointment of a commission of three who should
prepare and put into effect suitable rules for carrying out the law. The
act also provided that government offices should be arranged in classes
and that entrance to any class should be obtained by competitive
examination; that no person should be removed from the service for
refusing to contribute to political funds; and that examinations should
be held in one or more places in each state and territory where
candidates appeared. The system was to be inaugurated in customs
districts and post offices where the number of employees was as many as
fifty, but could be extended later under direction of the President. The
soliciting or receiving of contributions by federal officials of all
grades, for political purposes, was forbidden. With the exceptions just
mentioned, officers could be removed from office as before, but the
purpose of removal was now gone. Since the appointee to the vacancy must
be the successful competitor in an examination, the chief who removed an
officer could not replace him with a personal friend or party worker.

The first commission was headed by Dorman B. Eaton. The work of grading
officials and placing them within the protection of the law began at
once, and by the close of President Arthur's term nearly 16,000 were
classified. Fortunately, the work of the commission was carried on
sensibly and slowly, and no backward steps had to be taken.

The attitude of Congress toward tariff revision illustrates many of the
characteristics of congressional action during the early eighties. In
his first message to Congress, Arthur said that the surplus for the year
was $100,000,000, and therefore urged the reduction of the internal
revenue taxes and the revision of the tariff. In May, 1882, Congress
authorized a tariff commission to investigate and report, and in
conformity with the law Arthur appointed its nine members. All of them
were protectionists and the chairman, John L. Hayes, was secretary of
the Wool Manufacturers' Association. After holding hearings in more than
a score of cities and examining some hundreds of witnesses, the
commission recommended reductions varying from nothing in some cases to
forty or fifty per cent. in others. The average reduction was twenty to
twenty-five per cent.

Using the report as a foundation, the Senate drew up a tariff measure,
added it to a House bill which provided for a reduction of the internal
revenues, and passed the combination. Meanwhile, lobbyists poured into
Washington to guard the interests of the producers of lumber, pig-iron,
sugar and other materials upon which the tariff might be reduced. When
the Senate bill reached the House it contained lower duties than the
protectionist members desired. The latter, although in possession of the
organization of the House, were not strong enough to restore higher
rates, but under the shrewd management of Thomas B. Reed, one of their
number, they were able to refer the bill to a conference committee of
the two houses which contained seven strong protectionists out of ten
members. Reed admitted that the proceedings were "unusual in their
nature and very forcible in their character" but he felt that a change
in the tariff had been promised and that the only way to bring it about
in the face of Democratic opposition was to settle the details "in the
quiet of a conference committee." A "great emergency" having arisen, he
would take extraordinary measures. The bill produced under these
circumstances reduced the internal revenue taxes, lowered some of the
tariff duties and raised others, but left the general level at the point
where it had been at the close of the war. _The Nation_, favorable to
reform, scornfully characterized the act as "taking a shaving off the
duty on iron wire, and adding it to the duty on glue!" Senator Sherman,
a protectionist member of the conference committee, wrote an account of
the whole procedure many years afterward. After commending the spirit
and proposals of the tariff commission and mentioning the successful
efforts of many persons to have their individual interests looked out
for, he expressed a regret that he did not defeat the bill, as he could
have done in view of the evenly balanced party situation in the Senate
at that time.


BIBLIOGRAPHICAL NOTE

The election of 1880 is well treated by Sparks, Stanwood, Andrews, and
Rhodes. Senator G.F. Hoar, the chairman of the Republican nominating
convention, has a valuable chapter in his _Autobiography of Seventy
Years_. Such newspapers as the New York _Times_ and _Tribune_ are
invaluable for a discussion of the conventions.

The events of the administration, such as the tariff debates, the
passage of the civil service law and others are discussed in the special
works mentioned in Chapter V. Consult also: Edward Stanwood, _J.G.
Blaine_; T.C. Platt, _Autobiography_; and A.R. Conkling, _Life and
Letters of Roscoe Conkling_. The _Annual Cyclopaedia _contains several
excellent articles on the tariff (1882, 1883), civil service reform
(1883), star route trials (1882, 1883). H.C. Thomas, _The Return of the
Democratic Party to Power in 1884_ (1919), contains useful chapters on
Garfield and Arthur.

       *       *       *       *       *

[1] For Platt's account of the annual reunion and banquet of the three
hundred and six--"The Old Guard"--see _Autobiography_, 115.

[2] Garfield's early career as a canal boy led to such campaign songs
as the following:

    He early learned to paddle well his own forlorn canoe,
    Upon Ohio's grand canal he held the hellum true.
    And now the people shout to him: "Lo! 't is for you we wait.
    We want to see Jim Garfield guide our glorious ship of state."

[3] William Windom, of Minn., was Secretary of the Treasury; E.T.
Lincoln, of Ill., Secretary of War; Wayne MacVeagh, of Pa.,
Attorney-General; T.L. James, of N.Y., Postmaster-General; W.H. Hunt,
of La., Secretary of the Navy; S.J. Kirkwood, of Ia., Secretary of
the Interior.

[4] The death of the President emphasized the need of a presidential
succession law. Under an act of 1792, the president and vice-president
were succeeded by the president of the Senate and the speaker of the
House. When Garfield died, the Senate had not yet elected a presiding
officer and the House had not met. The death of Arthur would have left
the country without a legal head. The Presidential Succession Act of
1886 remedied the fault by providing for the succession of the cabinet
in order, beginning with the Secretary of State. The presiding officers
of the Senate and House were omitted, because they might not be of the
dominant party.

[5] The cabinet was composed of F.T. Frelinghuysen, N.J., Secretary of
State; C.J. Folger, N.Y., Secretary of the Treasury; R.T. Lincoln, Ill.,
Secretary of War; B.H. Brewster, Pa., Attorney-General; T.O. Howe, Wis.,
Postmaster-General; W.E. Chandler, N.H., Secretary of the Navy; H.M.
Teller, Colo., Secretary of the Interior.

[6] Above, p. 145.

[7] Some thoroughly unselfish members of Congress like Senator Hoar,
however, believed the bill a justifiable one and voted for it. See Hoar,
_Autobiography_, II, chapter VIII.




CHAPTER VIII


THE OVERTURN OF 1884

The election of 1880 was memorable only for the type of politics with
which that contest was so inextricably involved. The party leaders were
second-rate men; the platforms, except for that of the Greenback party,
were as lacking in definiteness as the most timid office-seeker could
desire; in brief, it was a cross-section of American professional
politics at its worst. The election of 1884 was a distinct, although not
a complete contrast. It was not a campaign of platforms, but like the
election of 1824 it was a battle of men. Two genuine leaders, each
representing a distinct type of politics, contended for an opportunity
to try out a philosophy of government in the executive chair. In 1880
the conventions were the chief interest--the campaign was dull. The
campaign of 1884, on the other hand, was one of the most remarkable in
our history.

It will be remembered that the year 1882 had been characterized by
political upheavals. In Pennsylvania the Greenbackers had demanded that
currency be issued only by the central government--not by the national
banks--and that measures be taken to curb monopolies; the independent
Republicans had revolted against Cameron, and demanded civil service
reform and the overthrow of bossism; and the Democrats had elected a
governor of the reformer type, Robert E. Pattison. Massachusetts
Republicans had gasped the day after the election to find that "Ben"
Butler, who bore a questionable reputation as a politician, as a soldier
and as a man, had been elected by a combination of Greenbackers and
Democrats on a reform program. In New York the Democrats had taken
advantage of a factional quarrel among their opponents to elect as
governor a man who had achieved a reputation as a reformer--Grover
Cleveland. That some of the states which had been Democratic in 1882,
had become Republican again in 1883 illustrates the unstable character
of the politics of the time.

The beginning of the convention season of 1884 gave hint of the vigorous
campaign ahead. An Anti-Monopoly party nominated Benjamin F. Butler, who
was also supported by the Greenbackers. The Prohibitionists presented a
ticket headed by John P. St. John. The action of the Republican
convention, which met at Chicago on June 3, proved to be the turning
point in the campaign. President Arthur was frankly a candidate for
another term, but he did not have the united support of the professional
politicians and was distrusted by most of the reform element. Nor had
his veto of the Chinese immigration bill and the rivers and harbors act
tended to increase his popularity. Most enthusiastic, confident and
vociferous were the supporters of James G. Blaine, of Maine. The
independent element hoped to nominate Senator Edmunds, of Vermont, and
was particularly disturbed at the character of the workers for the "Man
from Maine." His campaign manager, Stephen B. Elkins, had been charged
with a discreditable connection with the star-route scandals; men of the
Platt type were urging that it was now Blaine's "turn"; and Powell
Clayton, an Arkansas carpet-bagger of ill-repute, was the Blaine
candidate for the position of temporary chairman of the convention.

Before a candidate was chosen the delegates turned to the adoption of
the platform. This was of the usual type but was an advance over that of
1880 in several respects. It committed the party to a protective tariff
and advocated an interstate commerce law and the extension of civil
service reform.

The balloting for candidates proved that Blaine was clearly the choice
of the convention. The mere mention of his name threw the delegates
into storms of applause and even on the first ballot he received votes
from every state in the union save five. On the fourth ballot he
received an overwhelming majority and became the nominee. John A.
Logan of Illinois, a prominent politician and soldier, was nominated
for the Vice-Presidency--a tail to the ticket, in the opinion of the
Democrats, which was designed to "Wag Invitation to the Soldier Vote."
The choice of Blaine was variously received by the different factions
in the convention. The Pacific coast delegates, in a special train,
went from Chicago to Augusta, Maine, before starting for home, in
order personally to pledge their support to the candidate. On the
other hand, Theodore Roosevelt disgustedly remarked that he was going
to a cattle-ranch in the West to stay he knew not how long. George
William Curtis sadly declared that he had been present at the birth of
the Republican party and feared that he was to be a witness of its
death. Other reformers were no less disaffected.

The outspoken Republican opposition to Blaine gave infinite aid and
comfort to the Democrats whose convention, coming a month later, could
take advantage of the growing schism in the opposition. During the
interval between the two conventions the growing sentiment in favor of
the nomination of Grover Cleveland received the additional impetus of
independent Republican support. The Democratic party was still an object
of suspicion to them, but they were ready to run the risks of even a
Democratic administration, if a leader of proved integrity should be
nominated, and Cleveland seemed to them to meet the demands of the
times. The first work of the convention, which met in Chicago on July 8,
was the adoption of a reform platform. Characterizing the opposition
party as a "reminiscence," it condemned Republican misrule, and promised
reform; it proposed a revision of the tariff that would be fair to all
interests, and reductions which would promote industry, do no harm to
labor and raise sufficient revenue; and it briefly advocated "honest"
civil service reform.

The enthusiasm which the independent Republicans were manifesting for
Cleveland was balanced by the hostility of elements within his party.
As Governor he had exercised his veto power with complete disregard
for the effect on his own political future. He had, for example,
vetoed a popular measure reducing fares on the New York City elevated
railroad, basing his objections on the ground that the bill violated
the provisions of the fundamental railroad law of the state. He was
opposed by Tammany Hall, led by John Kelley, who declared that the
labor element disliked him. Kelley's reputation, however, was such
that his hostility seemed like a compliment and gave force to General
Bragg's assertion, in seconding the nomination of Cleveland, that his
friends "love him most for the enemies he has made." The first ballot
proved that the Governor was stronger than his competitors, Senator
Bayard, Allen G. Thurman, Samuel J. Randall and several men of lesser
importance, and on the second ballot he received the nomination.

The choice of Cleveland gave the independent movement more than the
expected impetus. The New York _Times_ at once crossed the line into
the Cleveland camp and _Harpers Weekly_, long a supporter of the
Republicans, the Boston _Herald_, Springfield _Republican_, New York
_Evening Post_, _The Nation_, the Chicago _Times_ and a host of less
important ones followed. A conference of Independents in New York
City, which was composed of five hundred delegates and which enlisted
the support of such men as Carl Schurz, George William Curtis, Henry
C. Lea, Charles J. Bonaparte, Moorfield Storey and President Seelye of
Amherst College, gave striking evidence of the revolt which Blaine's
nomination had aroused. Curtis said in the conference, that the chief
issue of the campaign was moral rather than political. The New York
_Times_ declared that the issue was a personal one. Some of the better
element, however, like Senator Hoar, earnestly urged the election of
Blaine, while Senator Edmunds refused either to aid or oppose his
party. Others, like Roosevelt, were unable to give ungrudging support,
but felt that reform would be better promoted by working within the
party than by withdrawing. It is obvious that Blaine and Cleveland,
not the platforms of the parties, had become the issue of the
campaign.

James G. Blaine was born in Pennsylvania in 1830, was educated at
Washington College in his native state, later moved to Augusta, Maine,
and purchased an interest in the Kennebec _Journal_. On assuming his
journalistic duties he familiarized himself with the politics of the
state and became powerful in local, and later in federal affairs. He was
a member of the first Republican convention and was chairman of the
state Republican committee for more than twenty years, from which point
of vantage he had a prevailing influence in Maine politics. He served in
the state and federal legislatures as well as in Garfield's cabinet and
was a prominent candidate for the presidential nomination in 1876 and in
1880.

Grover Cleveland, although only seven years younger than Blaine, was
relatively inexperienced on the stage of national affairs. He was born
in New Jersey, the son of a Presbyterian minister, grew up with little
education, was salesman in a village store and later clerk in a law
office, at the age of eighteen. Although he had been sheriff of Erie
County, it was not until 1881, when he became mayor of Buffalo, that
he took an important part in politics, and here his record as the
business-like "veto mayor" was such as to carry him into the governor's
chair a year later. The huge majority which he received in the
gubernatorial contest was not wholly due to his own strength--doubtless
factional quarrels among the Republicans assisted him--but the
prominence which this election gave him and his conduct as Governor
made inevitable his candidacy for higher office.

Few men could have been nominated who would have presented a more
complete contrast than Blaine and Cleveland. In personality Blaine was
magnetic, approachable, high-strung, possessed of a vivid imagination
and of a marvellous memory for facts, names and faces. Over him men
went "insane in pairs," either devotedly admiring or completely
distrusting him. Cleveland was almost devoid of personal charm except
to his most intimate associates. He was brusque and tactless,
unimaginative, plodding, commonplace in his tastes and in the elements
of his character. Men threw their hats in the air and cheered
themselves hoarse at the name of Blaine; to Cleveland's courage,
earnestness and honesty, they gave a tribute of admiration. When the
campaign was at fever heat, Blaine was lifting crowds of eager
listeners to the mountain peaks of enthusiasm; Cleveland was in the
governor's room in Albany, phlegmatically plodding away at the
business of his office. He was too heavy, unimaginative, direct, to
indulge in flights of oratory. Yet scarcely anything that Blaine said
still lives, while some of Cleveland's phrases have passed into the
language of every-day.

No less a contrast existed between Blaine and Cleveland as political
characters. The former's experience in the machinery of politics, in the
disposal of its loaves and fishes, has already been mentioned. Of that
part of politics, Cleveland had had no experience. It is said that he
never was in Washington, except for a single day, until he went there to
become President. Both were bold and active fighters, but Blaine was a
strategist, a manager and a diplomat, while Cleveland could merely state
the policy which he desired to see put into effect, and then crash
ahead. Blaine had the instinct for the popular thing, was never ahead of
his party, was surrounded by his followers; Cleveland saw the thing
which he felt a moral imperative to accomplish and was far in advance of
his fellows. The Republican was popular among the professional political
element in his party and was supported by it; the Democrat never was.
Cleveland openly declared his attitude on controverted issues, in words
that admitted of no ambiguity and at times when only silence or soft
words would save him from defeat. Blaine lacked the moral courage and
the indifference to immediate results which were necessary for so
exalted an action. Cleveland had more of the reformer in his nature, and
had so keen a sense of responsibility and duty that his political career
was a succession of battles against things that seemed wrong to him.
Blaine accepted the party standards as they were; he belonged to the
past, to the policies and political morality of war and reconstruction;
Cleveland belonged to the transition from reconstruction to the
twentieth century.

The particular thing, however, that came out of Blaine's past to dog his
foot-steps, give him the enmity of the Independents--better known as the
"Mugwumps"--and, doubtless, to defeat him, was a series of transactions
exposed in the Mulligan letters. In order to understand these, it is
necessary to inquire into events that occurred fifteen years before the
overturn of 1884. In April, 1869, a bill favorable to the Little Rock
and Fort Smith Railroad--an Arkansas land-grant enterprise--was before
the House of Representatives. Blaine was Speaker. As the session was
near its close and the bill seemed likely to be lost, its friends
bespoke Blaine's assistance. He suggested that a certain point of order
be raised, which would facilitate the passage of the measure, and also
asked General John A. Logan to raise the point. Logan did so, Blaine
sustained him and the act was passed. Nearly three months later, Warren
Fisher, Jr., a Boston business man, asked Blaine to participate in the
affairs of the Little Rock Railroad. Blaine signified his readiness,
closing his letter with the words, "I do not feel that I shall prove a
dead-head in the enterprise if I once embark in it. I see various
channels in which I know I can be useful." When Blaine's enemies got
hold of this, they declared that he intended to use his position as
Speaker to further the interests of the road, as he had done at the time
of the famous point of order; his friends asserted that he intended
merely to sell the securities of the road to investors. Whether one of
these contentions is true, or both, he did sell considerable amounts of
the securities of the road to Maine friends, getting a "handsome
commission." Considerable correspondence passed between Blaine and
Fisher from 1869 to 1872 when their relations ended. Blaine understood
that all their correspondence was mutually surrendered.

In the spring of 1876, the presidential campaign was on the horizon and
Blaine was a prominent candidate for the Republican nomination.
Meanwhile ugly rumors were flying about concerning the connection of
certain members of Congress, Blaine among them, with questionable
railroad transactions, and he arose in the House to deny the charges. He
did not discuss the matter fully, as he did not wish his Maine
constituents to know that he had received a large commission for selling
Little Rock securities. Gossip grew, however, and a congressional
investigation resulted in May, 1876. Blaine was one of the witnesses,
but was doubtless anxious to bring the investigation to an end, since it
clearly reduced his chances of receiving the nomination. Presently
gossip said that Warren Fisher and James Mulligan were going to testify.
Mulligan had been confidential clerk to one of Mrs. Blaine's brothers
and later to Fisher. When Mulligan began his testimony it appeared that
he intended to lay before the committee a package of letters that had
passed between Blaine and Fisher, and thereupon, at Blaine's whispered
request, one of the members of the committee procured an adjournment for
the day. That evening Blaine found Mulligan at the latter's hotel and
prevailed on him to surrender the letters temporarily, in order that
Blaine might read and then return them. Blaine thereupon consulted two
lawyers and on their advice he refused to restore the package to
Mulligan. Merely to keep silence, however, was to admit guilt. Blaine,
therefore, arose one day in the House of Representatives and holding the
letters in his hand read selections and defended himself in a remarkable
burst of emotional oratory. At the climax of this defence he elicited
from the chairman of the committee of investigation an unwilling
admission that the committee had suppressed a dispatch which Blaine
declared would exonerate him. Blaine was triumphant, his friends sure
that he had cleared himself and the matter dropped for the time. Further
investigation was prevented by Blaine's refusal to produce the letters
even before the committee and by his sudden illness shortly afterward.
His election to the Senate soon took him out of the jurisdiction of the
House committee and no action resulted.

The nomination of Blaine in 1884 was a fresh breeze on the half-dead
embers of the Mulligan letters. _Harper's Weekly_ and other periodicals
published them with damaging explanatory remarks. Campaign committees
spread them abroad in pamphlet form. Attention was directed to such
phrases as "I do not feel that I shall prove a dead-head" and "I see
various channels in which I know I can be useful." Hostile cartoonists
used the phrases with an infinite variety of innuendo. But the most
powerful evidence was still to come. On September 15, 1884, Fisher and
Mulligan made public additional letters which Blaine had not possessed
at the time of his defence in 1876. The most damaging of these was one
in which Blaine had drawn up a letter completely exonerating himself,
which he asked Fisher to sign and make public as his own. Blaine had
marked his request "confidential" and had written at the bottom "Burn
this letter." Fisher had neither written the letter which was requested
nor burned Blaine's. Meanwhile it was recalled that Blaine had earlier
characterized the reformers as "upstarts, conceited, foolish, vain" and
as "noisy but not numerous, pharisaical but not practical, ambitious but
not wise," and the already intemperate campaign became more personal
than ever.

Thomas Nast's able pencil caricatured Blaine in _Harper's Weekly_ as a
magnetic candidate too heavy for the party elephant to carry; _Puck_
portrayed him as the "tattooed man" covered all over with "Little Rock,"
"Mulligan Letters" and the like. _Life_ described him as a

    Take all I can gettery,
    Mulligan lettery,
    Solid for Blaine old man.

Nor was the contest of scurrility entirely one-sided. _Judge_
caricatured Cleveland in hideous cartoons. The New York _Tribune_
described him as a small man "everywhere except on the hay-scales."
Beginning in Buffalo rumors spread all over the country that Cleveland
was an habitual drunkard and libertine. As is the way of such gossip,
its magnitude grew until the Governor appeared in the guise of a monster
of immorality. The editor of the _Independent_ went himself to Buffalo
and ran the rumors to their sources. He came to the conclusion that
Cleveland as a young man had been guilty of an illicit connection, that
he had made amends for the wrong which he had done and had since lived a
blameless life. Such religious periodicals as the _Unitarian Review_,
however, continued to describe him as a "_debauchee_" and "_roué_."
Nearly a thousand clergymen gathered in New York declared him a synonym
of "incapacity and incontinency." Much was made, also, of the fact that
Cleveland had not served in the war, and John Sherman denounced him as
having no sympathy for the Union cause. It did little good in the heated
condition of partisan discussion to point out that young Cleveland had
two brothers in the service, that he was urgently needed to support his
widowed mother and her six other children, and that he borrowed money to
obtain a substitute to take the field. On the other side, _Harper's
Weekly_ dwelt upon the Mulligan scandal; _The Nation_, while deploring
the incident in Cleveland's past, considered even so grave a mistake as
less important than Blaine's, since the latter's vices were those by
which "governments are overthrown, states brought to naught, and the
haunts of commerce turned into dens of thieves."

As the campaign neared an end it appeared that the result would turn
upon New York, Connecticut, New Jersey, and Indiana, and especially upon
the first of these. In New York several elements combined to make the
situation doubtful and interesting. Tammany's dislike of Cleveland was
well-known, but open opposition, at least, was quelled before election
day. Roscoe Conkling, still influential despite his retirement, refused
to take the stump in behalf of Blaine, declaring that he did not engage
in "criminal practice." The Republicans also feared the competition of
the Prohibitionists, because they attracted some Republicans who refused
to vote for Blaine and could not bring themselves to support a Democrat.
On the eve of the election an incident occurred which would have been of
no importance if it had not been for the closeness of the contest. As
Blaine was returning from a speaking tour in the West, he was given a
reception in New York by a delegation of clergymen. The spokesman of the
group, the Reverend Dr. Burchard, referred to the Democrats as the party
of "Rum, Romanism and Rebellion." Blaine, weary from his tour, failed to
notice the indiscreet remark, but the opposition seized upon it and used
it to discredit him in the eyes of the Irish. On the same evening a
dinner at Delmonico's at which many wealthy men were present, provided
material for the charge that the Republican candidate was the choice of
the rich classes.

Early returns on election night indicated that the Democrats had carried
the South and all the doubtful states, with the possible exception of
New York. There the result was so close that some days elapsed before a
final decision could be made. Excitement was intense; and business
almost stopped, so absorbed were people in the returns. At length it was
officially decided that Cleveland had received 1,149 more votes than
Blaine and by this narrow margin the Democrats carried New York, and
with it the election.

Contemporary explanations of Blaine's defeat were indicated by a
transparency carried in a Democratic procession which celebrated the
victory:

    The _World_ Says the Independents Did It
    The _Tribune_ Says the Stalwarts Did It
    The _Sun_ Says Burchard Did It
    Blaine Says St. John Did It
    Theodore Roosevelt Says It Was the Soft Soap Dinner[1]
    We Say Blaine's Character Did It
    But We Don't Care What Did It
             It's Done.

None of these explanations took into account the strength of Cleveland,
but the closeness of the result made all of them important. From the
vantage ground of later times, however, it could be seen that greater
forces were at work. By 1884 the day had passed when political contests
could be won on Civil War issues. The younger voters had no recollections
of Gettysburg and felt no animosity toward the Democratic South. Moreover,
Cleveland's success was the culmination of a long-continued demand for
reform, which he satisfied better than Blaine.

The opening of the first Democratic administration since Buchanan's time
excited great interest in every detail of Cleveland's activities and
characteristics.[2] Moreover, many who had voted for him distrusted his
party and were apprehensive lest it turn out that a mistake had been
made in placing such great confidence in one man. The more stiffly
partisan Republicans firmly believed that Democratic success meant a
triumphant South, with the "rebels" again in the saddle. Sherman
declared that Cleveland's choice of southern advisors was a "reproach to
the civilization of the age," and Joseph B. Foraker, speaking in an Ohio
campaign, found that the people wished to hear Cleveland "flayed" and
wanted plenty of "hot stuff."

The President's early acts indicated that the partisans were unduly
disturbed. His inaugural address was characterized by straightforward
earnestness. The exploitation of western lands by fraudulent claimants
was sharply halted. The cabinet, while inexperienced, contained several
able men, of whom Thomas F. Bayard, Secretary of State, William C.
Whitney, Secretary of the Navy, and L.Q.C. Lamar, the Secretary of the
Interior, were best known.[3]

The first great obstacle that Cleveland faced was well portrayed by one
of Nast's cartoons, in which the President, with an "Independent" club
in his hand, was approaching a snarling, open-jawed tiger, which
represented the office-seeking classes. The drawing was entitled
"Beware! For He is Very Hungry and Very Thirsty." It was not difficult
to foresee grave trouble ahead in connection with the civil service. The
Democrats had been out of power for twenty-four years, the offices were
full of Republicans, about 100,000 positions were at the disposal of the
administration, and current political practice looked with indifference
upon the use of these places as rewards for party work. Hordes of
office-seekers descended upon congressmen, in order to get introductions
to department chiefs; they filled the waiting rooms of cabinet officers;
they besieged Cleveland. Disappointed applicants and displaced officers
added to the clamor and confusion.

The President's policy, as it worked out in practice, was a compromise
between his ideals and the wishes of the party leaders. He earnestly
approved the Pendleton act and desired to carry out both its letter and
its spirit. He removed office holders who were offensively partisan and
who used their positions for political purposes. He gave the South a
larger share in the activities of the government, both in the cabinet
and in the diplomatic and other branches of the service. When the term
of a Republican office holder expired he filled the place with a fit
Democrat, if one could be found, in order to equalize the share of the
two parties in the patronage. Nearly half of the diplomatic and consular
appointments went to southerners, and eventually most of the Republicans
were supplanted.

The displacement of so many officials gave the Republicans an
opportunity to attempt to discredit the President in the eyes of his
mugwump supporters. An amended law of 1869 gave the Senate a certain
control over removals, although the constant practice of early times had
been to give the executive a free hand. Moreover the law had fallen into
disuse--or, as the President put it--into "innocuous desuetude." The
case on which the Senate chose to force the issue was the removal of
George M. Duskin, United States District Attorney in Alabama, and the
nomination of John D. Burnett in his place. The Senate called upon the
Attorney-General to transmit all papers relating to the removal; the
President directed him to refuse, on the ground that papers of such a
sort were not official papers, to which the Senate had a right, and also
on the ground that the power of removal was vested, by the Constitution,
in the president alone. In the meantime it had been hinted to Cleveland
that his nominations would be confirmed without difficulty if it were
acknowledged that the suspensions were the usual partisan removals. To
do this would, of course, make his reform utterances look hypocritical
and he refused to comply:

    I ... dispute the right of the Senate ... in any way save
    through the judicial process of trial on impeachment, to review
    or reverse the acts of the Executive in the suspension, during
    the recess of the Senate, of Federal officials.

As he was immovable and was taking precisely the position that such
Republican leaders as President Grant had previously taken, the Senate
was obliged to give way. Although it relieved its feelings by censuring
the Attorney-General, it later repealed the remains of the Tenure of
Office act of 1869, leaving victory with the President.

In connection with the less important offices Cleveland was forced to
compromise between the desirable and the practicable. Most of the
postmasters were changed, although in New York City an efficient officer
was retained who had originally been appointed by Garfield. All the
internal revenue collectors and nearly all the collectors of customs
were replaced. On the other hand, the classified service was somewhat
extended by the inclusion of the railway mail service, a change which,
with other increases, enlarged the classified lists by 12,000 offices.

It seems evident that Cleveland pressed reform far enough to alienate
the politicians but not so far as to satisfy the reformers. When he
withstood Democratic clamor for office, the Independents applauded, and
the spoilsmen in his own party accused him of treason. When he listened
to the demands of the partisans, the reformers became disgusted and many
of them returned to their former party allegiance. Eugene Field
expressed Republican exultation at the dissension in the enemy's ranks:

    ... the Mugwump scorned the Democrat's wail,
    And flirting its false fantastic tail,
    It spread its wings and it soared away,
    And left the Democrat in dismay,
            Too hoo!

Aside from the President, official Washington seems to have had but
little real interest in reform. The Vice-President, Hendricks, was a
partisan of the old school, and so many members of Congress were out of
sympathy with the system that they attempted to annul the law by
refusing appropriations for its continuance. On the whole a fair
judgment was that of Charles Francis Adams, a Republican, who thought
that Cleveland showed himself as much in advance of both parties as it
was wise for a leader of one of them to be.

In addition to further improvements in the civil service laws, Cleveland
was interested in a long list of reforms which he placed before Congress
in his first message: the improvement of the diplomatic and consular
service; the reduction of the tariff; the repeal of the Bland-Allison
silver-coinage act; the development of the navy, which he characterized
as a "shabby ornament" and a naval reminder "of the days that are past";
better care of the Indians; and a means of preventing individuals from
acquiring large areas of the public lands. The fact that Hayes and
Arthur had urged similar reforms showed how little Cleveland differed
from his Republican predecessors. It was not likely, however, that the
program would be carried out, for Congress was not in a reforming mood
and the Republicans controlled the upper house so that they could block
any attempt at constructive policies.

The latent hostility which many of the Civil War veterans felt toward
the Democratic party was fanned into flame by Cleveland's attitude
toward pension legislation. The sympathy of the country for its disabled
soldiers had early resulted in a system of pensions for disability if
due either to wounds or to disease contracted in the service. Early in
the seventies the number of pensioners had seemed to have reached a
maximum. Two new centers of agitation, however, had appeared, the Grand
Army of the Republic and the pension agent. The former was originally a
social organization but later it took a hand in the campaign for new
pension legislation. The agents were persons familiar with the laws, who
busied themselves in finding possible pensioners and getting their
claims established. The agitation of the subject had resulted in the
arrears act of 1879, which gave the claimant back-pensions from the day
of his discharge from the army to the date of filing his claim,
regardless of the time when his disability began. As the average first
payment to the pensioner under this act was about $1,000, the number of
claims filed had grown enormously and the pension agents had enjoyed a
rich harvest. The next step was the dependent pensions bill, which
granted a pension to all who had served three months, were dependent on
their daily toil, and were incapable of earning their livelihood,
whether the incapacity was due to wounds and disease or not. President
Cleveland's veto of the measure aroused a hostility which was deepened
by his attitude toward private pension acts.

For some time it had been customary to pass special acts providing
pensions for persons whose claims had already been rejected by the
pension bureau as defective or fraudulent. So little attention was paid
to private bills in Congress that 1454 of them passed between 1885 and
1889, generally without debate and often even without the presence of a
quorum of members. Two hours on a day in April, 1886, sufficed for the
passage of five hundred such bills. Nobody would now deny that many were
frauds, pure and simple. Cleveland was too frugal and conscientious to
pass such bills without examination and he began to veto some of the
worst of them. Each veto message explained the grounds for his dissent,
sometimes patiently, sometimes with a sharp sarcasm that must have made
the victim writhe. In one case where a widow sought a pension because of
the death of her soldier husband it was discovered that he had been
accidentally shot by a neighbor while hunting. Another claimant was one
who had enlisted at the close of the war, served nine days, had been
admitted to the hospital with measles and then mustered out. Fifteen
years later he claimed a pension. The President vetoed the bill,
scoffing at the applicant's "valiant service" and "terrific encounter
with the measles." Altogether he vetoed about two hundred and thirty
private bills. Time after time he expressed his sympathy with the
deserving pensioner and his desire to purge the list of dishonorable
names, and many applauded his courageous efforts. Nevertheless, his
pension policy presented an opportunity for hostile criticism which his
Republican opponents were not slow to embrace. His efforts in behalf of
pension reform were said to originate in hostility to the old soldiers
and in lack of sympathy with the northern cause. In 1887 it even became
necessary for him to withdraw his acceptance of an invitation to attend
a meeting of the Grand Army in St. Louis, because of danger that he
might be subjected to downright insult.[4]

Before the hostility due to the pension vetoes had subsided,
Adjutant-General Drum called the attention of the President to the fact
that flags taken from Confederate regiments by Union soldiers during the
war and also certain flags formerly belonging to northern troops had for
many years lain packed in boxes in the attic and cellar of the War
Department. At his suggestion Cleveland ordered the return of these
trophies to the states which the regiments had represented. Although
recommended by Drum as a "graceful act," it was looked upon by the old
soldiers with the utmost wrath. The commander of the Grand Army called
upon Heaven to avenge so wicked an order and such politicians as
Governor Foraker of Ohio gained temporary prominence by their bitter
condemnation of it. Eventually the clamor was so great that the
President rescinded the order on the ground that the final disposition
of the flags was within the sphere of action of Congress only. In
February, 1905, however, Congress passed a resolution providing for the
return of the flags and the exchange was effected without excitement.

For the reasons already mentioned, little legislation was passed during
President Cleveland's administration that was of permanent importance.
An exception was the Interstate Commerce Act, which is a subject for
later discussion. A Presidential Succession Act, which has earlier been
described, provided for the succession of the members of the cabinet in
case of the removal or death of the president and vice-president. The
Electoral Count Act placed on the states the burden of deciding contests
arising from the choice of presidential electors. When more than one set
of electoral returns come from a state, each purporting to be legal,
Congress must decide which shall be counted. Of some importance, too,
was the establishment of the Department of Agriculture in 1889 and the
inclusion of its secretary in the cabinet. The admission of the Dakotas,
Montana and Washington as states took place in the same year. The
improvement of the navy, begun so auspiciously by Secretary Chandler
under President Arthur, was continued with enthusiasm and vigor, and the
vessels constructed formed an important part of our navy.

Of less popular interest than many of the political questions, but of
more lasting importance, was the rapid reduction of the public land
supply. The purpose of the Homestead law of 1862 had been to supply land
at low rates and in small amounts to _bona fide_ settlers, but the
beneficent design of the nation had been somewhat nullified by the
constant evasion of the spirit of the laws. Squatters had occupied land
without reference to legal forms; cattlemen had fenced in large tracts
for their own use and forcibly resisted attempts to oust them; by hook
and by crook individuals and companies had got large areas into their
possession and held them for speculative returns. Western public opinion
looked upon many such violations with equanimity until the supply of
land began to grow small. Then came the demand for the opening of the
Indian reservations, which comprised 250,000 square miles in 1885. The
Dawes act of 1887 provided for individual ownership of small amounts of
land by the Indians instead of tribal ownership in large reservations.
By this means a considerable amount of good land was made available for
settlement by whites. The dwindling supply of western land also called
attention to certain delinquencies on the part of the railway companies.
Many of them had been granted enormous amounts of land on certain
conditions, such as that specified parts of the roads be constructed
within a given time. This agreement, with others, was frequently broken,
and question arose as to whether the companies should be forced to
forfeit their claims. Cleveland turned to the problem with energy and
forced the return of some millions of acres. Nevertheless, the fact that
it was becoming necessary to be less prodigal with the public land
indicated that the supply was no longer inexhaustible, and led the
President in his last annual message to urge that the remaining supply
be husbanded with great care. Congress was not alert to the demands of
the time, however, and no effective steps were taken for many years.


BIBLIOGRAPHICAL NOTE

H.C. Thomas, _The Return of the Democratic Party to Power in 1884_
(1919), is most complete and scholarly on the subject; Sparks, Curtis,
Dewey, and Stanwood continue useful; H.T. Peck, _Twenty Years of the
Republic, 1885-1905_ (1907), is illuminating and interesting; H.J. Ford,
_Cleveland Era_ (1919), is brief; the files of _The Nation_ and
_Harper's Weekly_ are essential, while those of the New York _Sun,
Evening Post_ and _Tribune_ add a few points. The Mulligan letters are
reprinted in _Harper's Weekly_ (1884, 643-646).

On the administration, consult the general texts and the special volumes
mentioned in chapter V; G.F. Parker, _Recollections of Grover Cleveland_
(1909); and _Political Science Quarterly_ (June, 1918), "Official
Characteristics of President Cleveland," give something on the personal
side; J.L. Whittle, _Grover Cleveland_ (1896), is by an English admirer;
Cleveland's own side of one of his controversies is in Grover Cleveland,
_Presidential Problems_ (1904); on Blaine, Edward Stanwood, _James G.
Blaine_ (1905). The _Annual Cyclopaedia_ has useful biographical
articles.

       *       *       *       *       *

[1] A reference to the Dorsey dinner at which Arthur told how Indiana
was carried.

[2] His marriage to Miss Frances Folsom, which occurred in 1886,
occasioned lively interest.

[3] Other members were: Daniel Manning, N.Y., Secretary of the
Treasury; William C. Endicott, Mass., Secretary of War; A.H. Garland,
Ark., Attorney-General; William F. Vilas, Wis., Postmaster-General.

[4] President Cleveland also frequently used his veto power to prevent
the passage of appropriations for federal buildings which he deemed
unnecessary.




CHAPTER IX


TRANSPORTATION AND ITS CONTROL

The most significant legislative act of President Cleveland's
administration was due primarily neither to him nor to the great
political parties. It concerned the relation between the government
and the railroads, and the force which led to its passage originated
outside of Congress. The growth of the transportation system,
therefore, the economic benefits which resulted, the complaints which
arose and the means through which the complaints found voice were
subjects of primary importance.

Beginning with the construction of the Baltimore and Ohio Railroad
about 1830, the extension of the railways went forward with increasing
rapidity so that they soon formed a veritable network: between 1830
and 1850 over 7,000 miles were laid; by 1860 the total was 30,000
miles; the Civil War and the financial depression of 1873 retarded
progress somewhat, but such delays were temporary, and by 1890 the
total exceeded 160,000 miles. In the earlier decades most construction
took place in the Northeast, where capital was most plentiful and
population most dense. Later activity in the Northeast was devoted to
building "feeders" or branch lines. In the South, the relatively
smaller progress which had been made before the war had been undone
for the most part by the wear and tear of the conflict, but the
twenty-five years afterward saw greatly renewed construction. The most
surprising expansion took place in Texas where the 711 miles of 1870
were increased to 8,754 by 1890. In the Middle West, roads were
rapidly built just before the war and immediately after it, and the
first connection with the Pacific Coast, as has been shown, was made
in 1869.

[Illustration:
Railroad Mileage, 1860-1910, in thousands of miles]

Many of the circumstances accompanying this rapid expansion were novel
and important. Beginning with a federal grant to the Illinois Central,
for example, in the middle of the century, both the nation and the
states assisted the roads by gifts of millions of acres of land. It
was to the advantage of the companies to procure the grants on the
best possible terms, and they exerted constant pressure upon
congressmen whose votes and influence they desired. Frequently the
agents of the roads were thoroughly unscrupulous, and such scandals as
that connected with the Credit Mobilier were the result. More
important still, the fact that the federal and state governments had
aided the railroads so greatly gave them a strong justification for
investigating and regulating the activities of the companies.

Mechanical inventions and improvements had no small part in the
development of the transportation system. The early tracks,
constructed of wood beams on which were fastened iron strips, and
sometimes described as barrel-hoops tacked to laths, were replaced by
iron, and still later by heavy steel rails. By 1890 about eighty per
cent. of the mileage was composed of steel. Heavy rails were
accompanied by improved roadbeds, heavier equipment and greater speed.
A simple improvement was the gradual adoption of a standard
gauge--four feet eight and a half inches--which replaced the earlier
lack of uniformity. The process was substantially completed by the
middle eighties, when many thousands of miles in the South were
standardized. On the Louisville and Nashville, for example, a force of
8,763 men made the change on 1,806 miles of track in a single day. The
inauguration of "standard" time also took place during the eighties.
Hitherto there had been a wide variety of time standards and different
roads even in the same city despatched their trains on different
systems. In 1883 the country was divided into five vertical zones each
approximately fifteen degrees or, in sun-time, an hour wide. Both the
roads and the public then conformed to the standard time of the zone
in which they were.

[Illustration:
Map of the United States showing railroads in 1870]

Of greater importance was the consolidation of large numbers of small
lines into the extensive systems which are now familiar. The first
roads covered such short distances that numerous bothersome transfers
of passengers, freight and baggage from the end of one line to the
beginning of the next were necessary on every considerable journey. No
fewer than five companies, for example, divided the three hundred
miles between Albany and Buffalo, no one of them operating more than
seventy-six miles. In 1853, these five with five others were
consolidated into the New York Central Railroad. Sixteen years later,
in 1869, the Central combined with the Hudson River, and soon
afterwards procured substantial control of the Lake Shore and Michigan
Southern, the Rock Island, and the Chicago and Northwestern. As the
result of this process a single group of men directed the interests of
a system of railroads from New York through Chicago to Omaha. The
Pennsylvania Railroad began with a short line from Philadelphia to the
Susquehanna River, picked up smaller roads here and there--eventually
one hundred and thirty-eight of them, representing two hundred and
fifty-six separate corporations--reached out through the Middle West
to Cincinnati, Chicago and St. Louis, and in 1871 controlled over
three thousand miles of track, with an annual income of over forty
million dollars. In the eighties a railroad war in northern New
England started the consolidation of the Boston and Maine system.

The beneficial results of the growth of the transportation facilities
of the nation were immediate and revolutionary. The fact that average
freight rates were cut in halves between 1867 and 1890 helped make
possible the economic readjustments after the Civil War to a degree
that is not likely to be overestimated. Not only did railway
construction supply work for large numbers of laborers and help bring
about an ever greater westward migration, but it opened a market for
the huge agricultural surplus of the Middle West. Without the market
in the cities of the populous Atlantic Coast and Europe, the expansion
of the West would have been impossible. Moreover, the railways brought
coal, ore, cotton, wool and other raw materials to the Northeast, and
thus enabled that section to develop its manufacturing interests.

[Illustration:
Map of the United States showing railroads in 1890]

Despite the admittedly great benefits resulting from the railroad
system, there was a rising tide of complaint on the part of the public
in regard to some aspects of its construction and management. It was
objected, for example, that many of the western roads especially were
purely speculative undertakings. Lines were sometimes built into new
territory where competition did not exist and where, consequently, the
rates could be kept at a high point. The Chicago, Burlington and
Quincy presented such a case in 1856. Profits were so great as to
embarrass the company, since the payment of large dividends was sure
to arouse the hostility of the farmers who paid the freight rates.
"This, indeed," declared the biographer of one of the presidents of
the road, "was the time of glad, confident morning, never again to
occur in the history of railroad-building in the United States."
Sometimes lines were driven into territory which was already
sufficiently supplied with transportation facilities, in order to
compel the company already on the ground to buy out the new road. If,
as time went on, traffic enough for both roads did not appear, they
had to be kept alive through the imposition of high rates; otherwise,
one of them failed and the investors suffered a loss. The
opportunities for profit, however, were so numerous that the amount of
capital reported invested in railways increased by $3,200,000,000
during the five years preceding 1885.

A practice which was productive of much wrong-doing and which was
suggestive of more dishonesty than could be proved, related to the
letting of contracts for the construction of new lines. The directors
of a road frequently formed part or all of the board of directors of a
construction company. In their capacity as railroad directors they
voted advantageous contracts to themselves in their other capacity,
giving no opportunity to independent construction companies who might
agree to build at a lower cost. As the cost of construction was part
of the debt of the road, the directors were adding generously to their
own wealth, while the company was being saddled with an increased
burden. It cost only $58,000,000, for example, to build the Central
Pacific, but a construction company was paid $120,000,000 for its
services. When John Murray Forbes was investigating the Chicago,
Burlington and Quincy he found that the president of the road was
paying himself a salary as president of a construction company, out of
the railroad's funds, without the supervision of the treasurer or any
one else, and without any auditing of his accounts. Moreover, six of
the twelve members of the board of directors were also members of the
construction company. Such an attempt to "run with the hare and hunt
with the hounds" was suggestive, to say the least, of great
possibilities of profit to the directors and a constant invitation to
unnecessary construction.

Another grievance against the railways was the reckless, irresponsible
and arrogant management under which some of them operated. An eminent
expert testified before an investigating commission in 1885 that Jay
Gould once sold $40,000,000 of Erie Railway stock and pocketed the
proceeds himself. Most of the energy of the officers of some roads was
expended in deceiving and cheating competitors. "Railroad
financiering" became a "by-word for whatever is financially loose,
corrupt and dishonest." If certain roads demonstrated by successful
operation that honest methods were better in the long run, their
probity received scant advertisement in comparison with the
unscrupulous practices of their less respectable neighbors. It is to
be remembered, also, that the growth of the railway system had been so
rapid and so huge that it was impossible to meet the demand for
trained administrators. Naturally, men possessed of little or no
technical understanding of transportation problems could not provide
highly responsible management.

The dishonest manipulation of the issues and sales of railroad stocks
is a practice that was not confined solely to the twenty-five years
after the Civil War, but the numerous examples of it which occurred
during that period aggravated the exasperation which has already been
mentioned. Daniel Drew, the treasurer of the Erie Railway in 1866,
furnished an excellent illustration of this type of activity. Drew had
in his possession a large amount of Erie stock which had been secretly
issued to him in return for a loan to the company. The stock in the
market was selling near par and still rising. Drew instructed his
agents to make contracts for the future delivery of stock at prices
current at the time when the contracts were made. When the time came
for fulfilling his contracts, Drew suddenly threw the secret stock on
the market, drove general market prices on Erie stock down from
ninety-five to fifty, bought at the low figure, and sold at the high
price which was called for in the contracts made by his agents. The
effect of such sharp dealing on investors, the railroad or the public
seems not to have entered into the calculation. Indeed, the Erie and
many another road was looked upon by its owners merely as a convenient
piece of machinery for producing fortunes.

Gould, Drew and other railroad men of their time were also expert in
the practice of "stock-watering." This consists in expanding the
nominal capitalization of an enterprise without an equivalent addition
to the actual capital. The rates which the railway has to charge the
public tend to increase by approximately whatever dividends are paid
on the water.[1] Then, as later, when a road was prospering greatly
it would sometimes declare a "stock dividend," that is, give its
stockholders additional stock in proportion to what they already
owned. The addition would frequently be water. Its purpose might be to
cover up the great profits made by the company. If, on a million
dollars' worth of stock, it was paying ten per cent. dividends, the
public might demand lower freight and passenger rates; but if the
stock were doubled and earnings remained stationary, then the
dividends would appear as five per cent.--an amount to which there
could be no objection. H.V. Poor, the railroad expert, declared before
a commission of investigation in 1885 that the New York Central
Railroad was carrying $48,000,000 of water, on which it had paid eight
per cent. dividends for fifteen years. He also estimated that of the
seven and a half billions of indebtedness which the roads of the
country were carrying in 1883, two billions represented water. Others
thought that the proportion of water was greater. In any case the
unnecessary burden upon business to provide dividends for the watered
stock was an item of some magnitude. The investor, however, looked
upon stock-watering with other eyes. The building of a new road was a
speculation; the profits might be large, to be sure, but there might
in many cases be a loss. In order to tempt money into railroad
enterprises, therefore, inducements in the form of generous stock
bonuses were necessary.

The rate wars of the seventies gave wide advertisement to another
aspect of railroad history. The most famous of these contests had
their origin in the grain-carrying trade from the Lakes to the
sea-board. The entry of the Baltimore and Ohio and the Grand Trunk
into Chicago in 1874, stimulated a four-cornered competition among
these roads and the Pennsylvania and New York Central for the traffic
between the upper Mississippi Valley and the coast. Rates on grain and
other products were cut, and cut again; freight charges dropped to a
figure which wiped out profits; yet it was impossible for any line to
drop out of the competition until exhaustion forced all to do so. A
railroad can not suspend business when profits disappear, for fixed
expenses continue and the depreciation of the value of the property,
especially of the stations, tracks and rolling stock, is extreme.
Since the rate wars were clearly bringing ruin in their train, rate
agreements and pooling arrangements were devised. The latter took
several forms. Sometimes a group of competing roads agreed to divide
the business among the competitors on the basis of an agreed-upon
percentage. Another plan was to pool earnings at the close of a period
and divide according to a prearranged ratio. Sometimes destructive
competition was prevented by a division of the territory, each company
being allowed a free hand in its own field. In general, pooling
agreements were likely to break down, although a southern pool
organized by Albert Fink on a very extensive scale lasted for many
years and was thought to have had a vital influence in eliminating
rate-wars. Their efficacy depended mainly on good faith, and good
faith was a rarity among railroad officials in the seventies and
eighties. In the eyes of the public, rate agreements and pools were
vicious conspiracies which left the rights and well-being of the
private shipper completely out of the calculation.

Still another indictment of the railways resulted from their
participation in politics. It was inevitable, of course, that the
roads should be drawn into the field of legislation--the grants of
public land, for example, helped bring about the result. It early
seemed advantageous to attempt to influence state legislatures to pass
favorable laws, and it seemed a necessity to bring pressure to bear in
order to protect the roads from hostile acts. The methods used by the
railway agents in their political activity naturally varied all the
way from legitimate agitation to crude and subtle forms of bribery. An
insidious method of influencing both law-making and litigation was the
pass system. Under it the roads were accustomed to give free
transportation to a long list of federal and state judges, legislators
and politicians. For a judge to accept such favors from a corporation
which might at any time be haled before his court, and for a
legislator to receive a gift from a body that was constantly in need
of legislative attention is now held to be improper in the extreme.
But in those days a less sensitive public opinion felt hardly a qualm.
That the practice was likely to arouse an unconscious bias in the
minds of public officials is hardly debatable. The more crude forms of
bribery, too, were not uncommon. It was testified before a committee
of investigation that the Erie Railway Company in one year expended
$700,000 as a corruption fund and for legal expenses, carrying the
amount on the books in the "India-rubber account." The manipulation of
the courts of New York by the Erie and the New York Central during the
late sixties was nothing short of a scandal. Alliances between
political rings and railroad officials for the purpose of caring for
their mutual interests were so common that reformers questioned
whether the American people could be said to possess self-government
in actuality. Immediately after the Civil War, Charles Francis Adams,
an acute student of transportation, declared that it was scarcely an
exaggeration to say that the state legislatures were becoming a
species of irregular boards of railroad direction. The evils of the
alliance between the roads and politics were not, of course, due
entirely to the former. The receiver of a pass shared with the giver
the evil of the system. Many a legislator was corrupt; more shared in
practices which were little removed from dishonorable. Adams, for
example, gives an account of his experiences, as a director of the
Union Pacific, in dealing with a United States senator in 1884. The
congressman was ready to take excellent care of railroad corporations
which retained him as counsel, but was a corrupt and ill-mannered
bully toward the Union Pacific, which had not employed him.[2]

The most constant grievance was discrimination--that the roads varied
their rates for the benefit or detriment of especial types of freight,
of individuals and of entire localities. Through business between
competing points was carried at a low figure, while the roads recouped
themselves by charging heavily in towns where competition was absent.
Shippers complained that rates between St. Paul and Chicago, for
example, where competition existed were hardly more than half the
charges to places at a similar distance where a single road was in a
position to demand what it pleased. Manufacturers in Rochester could
send goods to New York City and reship them to Cincinnati, back
through Rochester, for less than the rate direct to their destination.
Yet the direct haul was seven hundred miles shorter than the indirect.
Secret arrangements were commonly made with favored shippers by which
they secured lower rates than their competitors. When it became
evident that transportation cost entered into the price of
substantially everything which the ordinary citizen consumed, and when
it was considered that a slight rise in railroad rates might easily
amount to a heavy tax on a shipper or an entire region, it was seen
that uniformity of rates was a matter of the utmost concern.

In brief, then, it was complained that the growth of the
transportation system had placed enormous power in the hands of a
small group of men, many of whom had indicated by their selfishness,
arrogance and questionable practices that they ought not to be
entrusted with so great a measure of authority.

The best example of the American railroad president after the war was
Commodore Cornelius Vanderbilt. Vanderbilt began his career by
ferrying passengers and freight between Staten Island and New York
City. Later he turned his attention to shipping, in which he made a
fortune, and planned the operation of steamships on a large scale.
Becoming interested in railroading, he clearly perceived the
importance of the western trade and the necessity of consolidation.
Vanderbilt was a man of vision, a man who combined magnitude of plan
with the vigorous grasp of the practical details necessary for the
realization of his ambitions. He was buoyant, energetic, confident,
ambitious, determined, despotic. Unhampered by modern conceptions of
public duty, undeterred by the hostility of powerful opponents, with
eyes fixed upon the combination and control of a great transportation
system, Vanderbilt entered courageously upon bitter struggles for
supremacy which involved the misuse of the courts, the control of the
New York state legislature and a thousand charges of corrupt influence
and bribery, but he welded railroads together, replaced wood and iron
with steel, and constructed tracks and terminals. At his death in 1877
he left a huge fortune and bequeathed to his successors a great,
consolidated railroad enterprise, skillfully and successfully
administered. The great weakness of Commodore Vanderbilt and his
associates, and of those who later imitated his work was their
fundamental conception of the railroad as a private venture. Success
consisted in bigness, great profits, crushing or buying out
competitors, and administering the business for the best good of the
few owners, regardless of the interests of the region through which
the railway passed. Vanderbilt and many of his contemporaries were men
of business sagacity and foresight, but their ethical outlook was
restricted and their sense of public responsibility not well
developed.

So considerable a list of grievances naturally bestirred the people to
seek relief at the hands of their legislators. Two lines of action
were followed. In Massachusetts, as early as 1869, a state commission
was formed with purely advisory powers. Under the able leadership of
Charles Francis Adams it attained great influence and worked
effectively for the elimination of railroad abuses through conference
and the weight of public opinion. In Illinois, on the other hand,
reliance was placed upon compulsory action. The state constitution of
1870 declared the railroads to be public highways and required the
legislature to fix rates for the carriage of freight and passengers,
and to pass laws to correct abuses connected with the railways and
grain warehouses. In compliance with the constitution the state passed
the necessary legislation and placed their execution in the hands of a
commission with considerable power. Other western states followed the
Illinois model.

On the national scale the agitation for government action began with
the minor parties. In 1872 the Labor Reformers demanded fair rates and
no discrimination; in 1876 the Prohibitionists called for lower rates;
in 1880 the Greenbackers stood for fair and uniform rates; four years
later they urged laws which would put an end to pooling,
stock-watering and discrimination, and in the same year the
Republicans promised an act to regulate commerce if they were elected.
The most effective force behind the demand for railroad regulation was
the Patrons of Husbandry, better known as the "Grange." This society
was founded by O.H. Kelley, a government clerk in Washington, in 1867.
Its initial purpose was the organization of the agricultural classes
for social and intellectual improvement, but later it engaged in the
effort to correct transportation abuses and to arouse cooperation
among the farmers in other ways. The movement grew astonishingly,
especially in the Middle West, where its membership reached nearly
759,000 in 1875.

Transportation conditions in the West had not reached the relatively
stable situation which characterized those of the East. In the West
much new work was being done, with the attendant evils of construction
companies and unnecessary and speculative undertakings. Much of the
railroad stock was in the hands of eastern investors whom the western
farmers pictured as living in idle ease on swollen incomes, careless
of the high rates and unfair discriminations under which the farmer
groaned. The constantly falling prices, which influenced the West in
so many other ways, served to heighten the discontent with any abuse
which increased the farmer's burden. Moreover, the western states had
contributed huge amounts of land to help build the railways and they
were not minded to give up the hold which their generosity had
justified.

Impelled, then, by such force as the Grange and similar organizations
supplied, the western states proceeded to the adoption of laws whose
purposes ordinarily included railroad rate-making by the legislature
or by a commission, the doing away with such abuses as discrimination,
and the prohibition of free passes. The railroads promptly opposed the
laws and carried the battle to the courts. The so-called "Granger
Cases" resulted. Three of these were representative of the general
trend of the decisions.

The famous case Munn _v._ Illinois, which was decided by the Supreme
Court in 1876 was possibly the most vital case in the history of the
regulation of public service corporations after the Civil War. The
legislature of Illinois, in conformity with the state constitution of
1870, had passed a law fixing maximum charges for the storage of grain
in warehouses. The owners of a certain warehouse refused compliance
with the law on the ground that it was contrary to the Constitution
and hence null and void. They argued that when the state fixed rates
it deprived the owners of the right to set higher charges and so, in
effect, deprived them of their property, in defiance of that portion
of the Fourteenth Amendment forbidding a state to "deprive any person
of life, liberty, or property, without due process of law."

On examination of the history of the control of such enterprises, the
Court found that it had been customary in England for many centuries
and in this country from the beginning, to regulate rates on ferries,
charges at inns, and similar public enterprises, and that it had never
been thought that such action deprived persons of property without due
process of law. In other words, the established common law, at the
time of the passage of the Fourteenth Amendment, did not look upon
rate regulation as a deprivation of property. The Court, therefore,
declared the Illinois warehouse law constitutional, and in doing so
made the following statement:

    Property does become clothed with a public interest when
    used in a manner to make it of public consequence, and affect
    the community at large. When, therefore, one devotes his
    property to a use in which the public has an interest, he, in
    effect, grants to the public an interest in that use, and must
    submit to be controlled by the public for the common good,
    to the extent of the interest he has thus created.

While the Munn case was before the Court, the case Peik _v._ the
Chicago and Northwestern Railway Company was raising a question which
struck at the heart of the chief practical impediment in the way of
state control of transportation. The central question in the
litigation was whether the legislature of Wisconsin could lawfully
regulate rates on railroads inside the state. Since the bulk of the
traffic on most roads crosses state borders at one time or another in
its transit, the regulation of rates within a state normally affects
interstate commerce. But the regulation of interstate commerce is
vested in Congress by the terms of the Constitution. The railroad was
quick to take advantage of the division of power between the states
and the nation. Indeed, when fighting state legislation, the roads
earnestly emphasized the exclusive power of Congress over interstate
commerce; but when fighting national regulation, they equally
deprecated any interference with the reserved rights of the states.
Acting in accordance with its established practice, the Court decided
that the state was authorized to regulate rates within its borders,
even though such regulation indirectly affected persons outside, until
Congress passed legislation concerning interstate commerce. Obviously
this decision allowed the states to work out their railroad problems
unhampered, and constituted one of the chief victories for the
Grangers.

In 1886, however, the Court overturned some of the principles which
had been established in the Munn and Peik cases. The new development
came about in connection with the Wabash railroad. It appeared that
the road had been carrying freight from Peoria, Illinois, to New York
for smaller rates than were charged from Gilman to New York, despite
the fact that Peoria was eighty-six miles farther away. Since Illinois
law forbade a road to levy a greater charge for a short haul than for
a long one, a suit was instituted and carried to the Supreme Court.
The company held that the Illinois legislation affected interstate
commerce and hence trenched upon the constitutional power of Congress.
This time the Court upheld the road. It decided that the
transportation of goods from Illinois to New York was commerce among
the states, that such commerce was subject to regulation by Congress
exclusively, and that the Illinois statute was void. It seemed, then,
that state regulation was a broken reed on which nobody could safely
lean, and attention thereupon turned to the federal government.

Congress had already been discussing federal regulation intermittently
for some years. The so-called "Windom Report" of 1874 had advised
federal construction and improvement of transportation facilities in
order to lower rates through competition, but no action had resulted.
In 1878 the "Reagan bill" had proposed government regulation, and from
that time the subject had been almost continuously before Congress. In
1885 the Senate had appointed a select committee of five to
investigate and report upon the regulation of freight and passenger
transportation. The committee was headed by Shelby M. Cullom, who had
been a member of the legislature of Illinois and later governor, in
the years when the railroad and warehouse laws were being put into
effect. It endeavored to discover all shades of opinion by visiting
the leading commercial centers, and by consulting business men, state
commissioners of railroads, Granger officials and others. After a
somewhat thorough investigation, the committee expressed its
conviction that no general question of governmental policy occupied so
prominent a place in the attention of the public as that of
controlling the growth and influence of corporations. The needed
relief might be obtained, the committee thought, through any one of
four methods: private ownership and management, with a greater or less
degree of government oversight; government ownership and management;
government ownership with private management under public regulations;
partial state ownership and management in competition with private
companies. The widespread opposition to state ownership of railroads,
the commission thought, seemed to point to some form of government
regulation and control of the existing situation.

Impressed with the magnitude of the abuses involved, and the
hopelessness of regulation through state laws, the committee presented
a bill designed to bring about regulation on a national scale through
a federal agency. The resulting law was the Interstate Commerce Act of
February 4, 1887. It provided that all railway charges should be
reasonable and just; forbade the roads to grant rebates, or to give
preferences to any person, locality or class of freight, or to charge
more for a short haul than for a long one except with the consent of
the proper authorities; it made pooling unlawful; and it ordered the
companies to post printed copies of their rates, which were not to be
altered except after ten days' public notice. The act also created an
Interstate Commerce Commission of five members to serve six-year
terms, into whose hands the administration of the measure was placed.
Persons who claimed that the railways were violating the provisions of
the law could make complaint to the Commission, or bring suit in a
United States Court. In order that the Commission might know the
condition of the roads, it was given power to call upon the carriers
for information, to demand annual reports from them, and to require
the attendance of witnesses. If the railroads refused to carry out the
orders of the Commission, they could be brought before a United States
district court.

In forbidding pools, the Act committed the railroads to the policy of
enforced competition, a policy which was commonly accepted at the time
as the best one for the public interest. Such experts, however, as
Professor A.T. Hadley and Charles Francis Adams, Jr., raised important
objections. They cited the rate wars to indicate the results of
competition and declared that railroads ought to be monopolies. If two
grocery stores are established where trade enough exists for only one,
they asserted, the weaker competitor can close his doors and the
public loss is not heavy; but in the case of the railways a weak
competitor must continue business even at disastrously low rates
because all his interest charges continue and the depreciation on his
property is extreme. The construction of an unnecessary road and its
subsequent operation at a loss, its failure or its abandonment,
constitute a great drain upon the public. Such objectors contended
that pooling combinations did away with many of the evils of
cut-throat competition, and they accordingly urged that the carriers
be permitted to make such arrangements, under whatever government
regulation might be needed to prevent unreasonable charges. By such
means the available business of a region might be fairly divided among
the roads entering it, without resort to competitive rate-cutting and
its consequent evils.

The passage of the law was looked upon with much hostility on the part
of the railroad interests. James J. Hill thought that the railroads
might survive, although the country would be ruined, and he predicted
that Congress would shortly be called in special session to repeal the
act. More important than mere hostility was the constant opposition
and evasion which characterized the attitude of the carriers toward
the operation of the law. Discriminations were commonly practiced and
hidden away in accounts under false or misleading headings. Rebates
were given and received, a fact which was due in no small degree to
the shippers themselves. A large shipper might demand advantageous
rates and threaten to turn his trade over to a rival road. As the
arrangement would be secret, and the likelihood of discovery small,
the temptation to break the law was correspondingly great.

The good results of the passage of the law were disappointingly
slight. To be sure, the Commission was gaining experience,
administrative precedents were being established and injustice was
somewhat less common than before. The first chairman was Judge T.M.
Cooley, a noted lawyer whose appointment was considered an admirable
one. Most important of all, the principle of government regulation was
established. Nevertheless, progress was so slow as to be almost
invisible. The courts hampered the activities of the Commission. When
cases arose involving its decisions, they allowed a retrial of the
entire case from the beginning, permitting the introduction of facts
which had been designedly withheld by the carriers in order to
undermine the influence of the Commission, and sometimes they reversed
its findings and so dulled the effectiveness of its labors. Eleven
years after the Act was passed the Commission declared that abuses
were so constant that the situation was intolerable; a prominent
railroad president made the charge that "good faith had departed from
the railway world"; and an important authority on railroad affairs
declared that the Commission had become an impotent bureau of
statistics.


BIBLIOGRAPHICAL NOTE

More study has been made of railroad regulation and the technical side
of railroading than of the history of transportation and the effects
of the roads on the political and economic life of the people. An
excellent single volume is John Moody, _The Railroad Builders_ (1919),
which devotes attention to the important personages of railroad
history, discusses the growth of large systems and contains valuable
maps; the best concise account of the history of the railways is W.Z.
Ripley, _Railroads: Rates and Regulation_ (1912). Chap. I; W.Z.
Ripley, _Railway Problems_ (rev. ed., 1913), is reliable; E.R. Johnson
and T.W. Van Metre, _Principles of Railroad Transportation_ (1916),
has some excellent chapters and several informing maps; C.F. Carter,
_When Railroads were New_, (1909), is a popular account; C.F. Adams,
_Chapters of Erie_ (1886), exposes early railroad practices; H.G.
Pearson, _An American Railroad Builder_ (1911), presents the career
of J.M. Forbes as a railroad president; A.T. Hadley, _Railroad
Transportation_ (1886), is a classic, early account. Consult also E.R.
Johnson, _American Railway Transportation_ (1903); Frank Parsons,
_Heart of the Railroad Problem_ (1906); C.F. Adams, Jr., _Railroads:
Their Origin and Problems_ (1878, rev. ed., 1893); "A Decade of
Federal Railway Regulation," in _Atlantic Monthly_ (Apr., 1898). On
the personal side, the following are valuable: E.P. Oberholtzer, _Jay
Cooke, Financier of the Civil War_ (2 vols., 1907); J.G. Pyle, _Life
of J.J. Hill_ (2 vols., 1917); _Memoirs of Henry Villard_ (1909). On
the subject of land grants and regulation: L.H. Haney, _Congressional
History of Railways_ (2 vols., 1910); S.J. Buck, _The Granger
Movement_ (1913), and the same author's _The Agrarian Crusade_ (1920),
are best on the relation of unrest among the agricultural classes to
the railroad problem. The "Cullom Report" is in Senate Reports, 49th
Congress, 1st session (Serial Number 2356), in 2 vols., and is a mine
of information on early abuses. The most important Granger cases are
in _United States Reports_, vol. 94, p. 113 (Munn _v._ Ill.), and vol.
118, p. 557 (Wabash case).

       *       *       *       *       *

[1] For example, an investor might contribute $100 in cash to an
enterprise. The "paid in capital" or "actual" capital would, then be
$100. He might receive in return $100 in stock and $100 in bonds, in
which case the "nominal capital" would be $200; the additional $100
would be "water." If the enterprise paid interest on the bonds, and
dividends on the stock, it would, of course, be paying a return on the
water. The practice of stock-watering did not end with the days of
Gould and Drew.

[2] In this connection Professor Farrand mentions the statement of a
railroad magnate that "in Republican counties he was a Republican, and
in Democratic counties he was a Democrat, but that everywhere he was
for the railroad." _Development of the United States_, p. 290.




CHAPTER X


EXTREME REPUBLICANISM

That the election of 1888 differed from its predecessors since 1865 was
due chiefly to the independence, courage and political insight of
President Cleveland. Hitherto campaigns had been contested with as
little reference to real issues as conditions rendered possible.
Neither party had possessed leaders with sufficient understanding of
the needs of the nation to force a genuine settlement of an important
issue. That 1888 saw a clear contest made it a memorable year in recent
politics.

It will be remembered that the tariff act of 1883 had been satisfactory
only to a minority in Congress, because it retained the high level of
customs duties that had been established during the Civil War. The
congressional election of 1882 had resulted in the choice of a
Democratic House of Representatives and had offered another opportunity
for downward revision. Early in 1884, therefore, William R. Morrison
presented a bill making considerable additions to the free list and
providing for a "horizontal" reduction of about twenty per cent. on all
other duties as levied under the act of 1883. The measure was defeated
by four votes. Opposed to it were substantially all the Republicans and
forty-one Democrats, most of them from the industrial states of New
York, New Jersey, Pennsylvania and Ohio. The Democratic tariff plank of
1884, as has been seen, was practically meaningless, but the election
of Cleveland, and the choice of a Democratic House gave another
opportunity for revision. Again Morrison attempted a reduction, and
again he was defeated by Samuel J. Randall and the other protectionist
Democrats.

The entire matter, however, was about to receive a new and important
development at the hands of President Cleveland and John G. Carlisle,
who was the Speaker of the House during the four years from 1885 to
1889. Carlisle was a Kentuckian, a man of grave bearing, unflagging
industry and substantial attainments. His tariff principles were in
accord with those of the President, and his position as Speaker enabled
him to determine the make-up of the Committee on Ways and Means, which
would frame any tariff legislation. Cleveland had expressed his belief
in the desirability of tariff reduction in his messages to Congress of
1885 and 1886, basing his recommendations on the same facts that had
earlier actuated President Arthur in making similar suggestions. His
recommendations, however, had received the same slight consideration
that had been accorded those of his Republican predecessor. He
therefore determined to challenge the attention of the country and of
Congress by means of a novel expedient.

Previous presidential messages had covered a wide variety of
subjects--foreign relations, domestic affairs, and recommendations of
all kinds. Departing from this custom, the President made up his mind
to devote an entire message to tariff reform. His project was startling
from the political point of view, for his party was far from being a
unit in its attitude toward reduction, a presidential campaign was at
hand, and the Independents, who had had a strong influence in bringing
about his success in 1884, sent word to him that a reform message would
imperil his chances of re-election. This type of argument had little
weight with Cleveland, however, and his reply was brief: "Do you not
think that the people of the United States are entitled to some
instruction on this subject?"

On December 6, 1887, therefore, he sent to Congress his famous message
urging the downward revision of the tariff. The immediate occasion of
his recommendation, he declared, was the surplus of income over
expenditure, which was piling up in the treasury at a rapid rate and
which was a constant invitation to reckless appropriations. The portion
of the public debt which was payable had already been redeemed, so that
whatever surplus was not expended would be stored in the vaults, thus
reducing the amount of currency in circulation, and making likely a
financial crisis. The simplest remedy for the situation seemed to
Cleveland to lie in a reduction of the income, and the most desirable
means of reduction seemed to be the downward revision of the tariff, a
system of "unnecessary taxation" which he denominated "vicious,
inequitable, and illogical." Disclaiming any wish to advocate free
trade, he expressed the hope that Congress would turn its attention to
the practical problem before it:

    Our progress toward a wise conclusion will not be improved by
    dwelling upon the theories of protection and free trade. This
    savors too much of bandying epithets. It is a _condition_ which
    confronts us, not a theory.

The effect of the message was immediate. Men began at once to take
sides as if everybody had been waiting for a leader to speak his mind;
and the parties adopted the definite principles to which they adhered
for many years afterwards. The Democrats very generally rallied to the
support of their champion; gaps in the ranks were closed up; and
doubtless the usual pressure was applied to obstinate members who were
disinclined to follow the leader. The Republican attitude was well
expressed in the phrase of one of the politicians: "It is free-trade,
and we have 'em!" The most prominent Republican, James G. Blaine, was
in Paris, but true to his instinctive recognition of a good political
opportunity he gave an interview which was immediately cabled to
America. In it Blaine maintained that tariff reduction would harm the
entire country, and especially the South and the farmers, and urged the
reduction of the surplus by the abolition of the tax on tobacco, which
he termed the poor man's luxury. The "Paris Message" was generally
looked upon as the Republican answer to Cleveland, and as pointing to
Blaine as the inevitable candidate for the ensuing campaign. On one
point, most men of both parties were agreed--that the President had
displayed great courage. "The presidential chair," declared James
Russell Lowell, "has a MAN in it, and this means that every word he
_says_ is weighted with what he _is_."

The chairman of the Ways and Means Committee in the House of
Representatives, Roger Q. Mills, promptly presented a bill which
conformed to the principles for which the President had argued. The
discussion of the Mills bill was long known as the "Great Tariff Debate
of 1888." The House seethed with it for more than a month. Mills and
Carlisle on one side and William McKinley and Thomas B. Reed on the
other typified the new leadership and the new positions which the
parties were taking. Senator Morrill's idea that the war tariff was a
temporary one, President Arthur's advice that the tariff be revised,
the recommendations of the Tariff Commission of 1882 that reductions
were necessary,--all these were no longer heard. Instead, the
Republicans upheld the protective system as the cause of the unexampled
prosperity of the nation. It is not to be supposed that protectionist
or reductionist converts were made by the endless discussion, but the
initial prejudices of each side were undoubtedly deepened. Each telling
blow on either side was applauded by the partisans of each particular
speaker, so that "applause" fairly dots the dull pages of the
Congressional Record. McKinley enlivened his colleagues by pulling from
his desk and exhibiting a suit of clothes which he had purchased for
$10.00, a figure, he asserted, which proved that the tariff did not
raise prices beyond the reach of the laboring man. Mills tracked down
the cost of the suit and the tariff on the materials composing it, and
further entertained the House by an exhibit showing that it cost $4.98
to manufacture the suit and that the remainder of the price which the
laborer paid was due to the tariff. In the end, the Mills bill passed
the House with but four Democrats voting against it. Randall was so ill
that he was unable to be present when the final vote was taken, but a
letter from him declaring his opposition to the bill was greeted with
great applause on the Republican side. Randall's day was past, however,
and leadership was passing to new men.

Meanwhile the Republicans in the Senate, where they were in control,
had prepared a tariff bill which was designed to give evidence of the
sort of act which would be passed if they were successful in the
campaign. Senator Allison and Senator Aldrich were influential in this
connection. The passage of leadership in tariff matters to Senator
Aldrich and men of his type was as significant as the transition in the
House. Aldrich was from Rhode Island, an able man who had had
experience in state affairs, had served in the federal House of
Representatives and had been in the Senate since 1881. He had already
laid the foundations of the great financial and industrial connections
which gave him an intimate, personal interest in protection and which
later made him an important figure in American industry and politics.
Since neither party controlled both branches of Congress, it was
impossible to pass either the Mills bill or the Senate measure; but the
proposed legislation indicated what might be expected to result from
the election. Each side had thoroughly committed itself on the tariff
question.

In the meanwhile, great interest attached to the question of leaders
for the campaign. Opposition to Cleveland was not lacking. His efforts
in behalf of civil service reform had not endeared him to the
office-seekers, and the hostility of the Democrats in the Senate was
shown by their feeble support of him. The West did not relish his
opposition to silver coinage, while his vetoes of pension legislation
were productive of some hostility, even in his own party. Nor was the
personality of the President such as to allay ill-feeling. Indeed,
Cleveland was in a position comparable to that of Hayes eight years
before. He was the titular party leader, but the most prominent
Democratic politicians were not in agreement with his principles, and
any step taken by him was likely to arouse as much hostility in some
Democratic quarters as among the Republicans. Opposition to his
nomination focused upon David B. Hill, Governor of New York, a man who
was looked upon as better disposed towards the claims of party workers
for office. Other leaders like Bayard, Thurman and Carlisle aroused
little enthusiasm, and the gradual drift of sentiment toward Cleveland
became unmistakable. If the politicians did not accept him with joy,
they at least accepted him; for he was master of the party for the
moment at least, and his hold on a large body of the rank and file was
not to be doubted. When the Democratic convention met in St. Louis in
June, 1888, his nomination was made without the formality of a
ballot.[1]

The platform was devoted, for the most part, to the question of revenue
reform, indorsing the President's tariff message and urging that the
party be given control of Congress in order that Democratic principles
might be put into effect. Resolutions were also adopted recommending
the passage of the Mills bill, which was still under discussion when
the convention met.

Among the Republicans the choice of a candidate was a far more
difficult matter. The probable choice of the party was Blaine, but his
letter from Italy, where he was travelling early in the convention
year, forbade the use of his name and opened the contest to a great
number of less well-known leaders. Publicly it was stated that Blaine
refused for reasons which were "entirely personal," but intimate
friends knew that he would accept a nomination if it came without
solicitation and as the result of a unanimous party call. Although the
demand for him still continued, there were smaller "booms" for various
favorite sons, and as his ill health continued he made known his
irrevocable decision to withdraw. Except for Blaine, the most prominent
contender was Senator Sherman, whose candidacy reached larger
proportions than ever before. The Ohio delegation was unitedly in his
favor and considerable numbers of southern delegates were expected to
vote for him. On the other hand, his lack of personal magnetism was
against him and his career had been connected with technical matters
which did not make a popular appeal. On the first ballot in the
nominating convention his lead was considerable, although not decisive,
but no fewer than thirteen other leaders also received votes. One of
these was Senator Benjamin Harrison of Indiana whom Blaine had
suggested as an available man and whom the New York delegation
considered a strong candidate because he was poor, a reputable senator,
a distinguished volunteer officer in the war and a grandson of William
H. Harrison of Tippecanoe fame. Further voting only emphasized the lack
of unanimity until the eighth ballot, when the delegates suddenly
turned to Harrison and nominated him.

The platform was long and verbose. It devoted much attention to the
protective tariff which, in imitation of Henry Clay, it entitled the
"American system"; it advocated the reduction of internal revenue
duties, if necessary to cut down the surplus; and it urged civil
service reform, liberal pensions and laws to control oppressive
corporations.

Two factions of the Labor party, as well as the Prohibitionists,
nominated candidates and urged programs to which no attention was paid,
but which were later taken up by both the great parties, such as
arbitration in labor disputes, an income tax, the popular election of
senators, woman suffrage and the prohibition of the manufacture of
alcoholic beverages.

The campaign deserves attention because of the unusual elements that
entered into it. A spectacular feature which, although not new, was
developed on a large scale, was the formation of thousands of political
clubs, which paraded evenings with flaming torches. In this type of
organization the Republicans were more successful than the Democrats
and thus steered many young men into the party at a time when they were
looking forward to casting their first ballot. The most unwholesome
feature was, as before, the methods used to finance the campaign. In
this connection both parties were guilty, but the Republicans were able
to tap a new source of supply. The campaign was in the hands of Matthew
S. Quay, a Pennsylvania senator whose career as a public official left
much to be desired. Quay's political methods were vividly described at
a later time by his friend and admirer Thomas C. Platt, whose account
lost none of its delightfulness in view of the fact that Platt
obviously felt that he was complimenting his friend in telling the
story. Believing in the "rights" of business men in politics, Platt
declared, Quay was always able to raise any amount of money needed,
although when funds were raised by business interests against him, he
lifted the "fiery cross" and virtuously exposed his opponents before
the people. Having calculated with skill the number of votes needed for
victory, he found out where he could get them--"and then he got them."

That Quay was able to tap a new source of supply was due to a
combination of circumstances. It will be remembered that the Pendleton
civil service act of 1883 had forbidden the assessment of
office-holders in political campaigns, and had made it necessary to
procure funds elsewhere. In the campaign of 1888, business men who
believed that the success of Cleveland would hurt their interests, and
manufacturers who profited directly by the protective tariff rallied to
the defence of Harrison and contributed heavily to his campaign
fund.[2]

The use to which the funds thus contributed were put was revealed in a
letter written apparently by W.W. Dudley, treasurer of the National
Republican Committee, and sent to party leaders in Indiana. The latter
were directed to find out who had the "Democratic boodle" and force
them, presumably by competition, to pay big prices for their own men.
The leaders were also instructed to "divide the floaters into blocks of
five and put a trusted man with the necessary funds in charge of these
five, and make him responsible that none get away, and that all vote
our ticket."

On the other hand the most wholesome feature of the campaign was its
educational aspect. Hundreds of societies, tons of "literature,"
thousands of stump speeches attacked and defended the tariff.
Schoolboys glibly retailed the standard arguments on one side or the
other. Attention was centered, as it had not been since the war, on an
important issue.

At the close of the campaign the Republicans played a trick which was
reminiscent of the Morey letter of Garfield's day. A letter purporting
to be from a Charles F. Murchison, a naturalized American of English
birth, was sent to the British minister in Washington, Lord
Sackville-West. Murchison requested the minister's opinion as to
whether President Cleveland's hostile policy in a recent controversy
with Canada had been adopted for campaign purposes and whether after
election the President would be more friendly toward England. Lord
Sackville indiscreetly replied that he believed President Cleveland
would show a conciliatory spirit toward Great Britain. The
correspondence was held back until shortly before the election and was
then published in the newspapers and on hand bills. Republicans
triumphantly declared that Cleveland was the "British candidate." The
President was at first inclined to overlook the incident but eventually
gave way to pressure and dismissed the minister, whereupon the English
government refused to fill the vacancy until there was a change of
administration.

In the ensuing election the vote cast was unusually heavy; the
protectionists felt that a supreme effort must be made to preserve the
tariff system, and the Democrats, having experienced the joys of power,
were determined not to loosen their grip on authority; the
Prohibitionists increased their vote over that of 1884 by 100,000,
while the Labor party cast 147,000, almost as many ballots as the
Prohibitionists had numbered in the earlier year. Cleveland received
somewhat over 100,000 more votes than Harrison, but his support was so
placed that his electoral vote was sixty-five less than his opponent's.

From the standpoint of political history the result was unfortunate.
The tariff question had been sadly in need of a definite answer, the
people had been educated upon it and had given a decision, but the
electoral system placed in power the party pledged to the theories of
the minority. Aside from the unusual effect of our machinery of
election, many small elements entered into the Republican victory. Some
of the Independents had become disaffected since 1884 and had returned
to the Republican fold. Disgruntled office-seekers opposed a President
who did not reward his workers. In New York, which was the decisive
factor, Hill was a candidate for re-election as governor and was
elected by a small majority, while Cleveland lost the state by 7,000
votes. This gave color to charges that the enemies of the President had
made a bargain with the Republicans by which the latter voted for Hill
as governor and the Democrats for Harrison as President.

Benjamin Harrison, veteran of the Civil War in which he had attained
the rank of brevet brigadier-general, and senator from Indiana for a
single term, was hardly a party leader when he was nominated for the
presidency. Although he was by no means unknown, he had been
sufficiently obscure to be unconnected with factional party quarrels,
and his career and character were without blemish. At the time of his
accession to the executive chair he was fifty-six years of age, a short
man with bearded face, and with head set well down between his
shoulders. Accounts of his characteristics, drawn by his party
associates, did not differ in any essential detail. As a public
speaker, the new President was a man of unusual charm--felicitous in
his remarks, versatile, tactful. In a famous trip through the South and
West in 1891, he made speech after speech at a wide variety of places
and occasions, and created a genuine enthusiasm. His remarks were
widely read and highly regarded. Nevertheless there seems to have been
some truth in the remark of one of his contemporaries that he could
charm ten thousand men in a public speech but meet them individually
and send every one away his enemy. His manner, even to senators and
representatives of his own party, was reserved to the point of
frigidity. When he granted requests for patronage he was so ungracious
as to anger the recipients of favor. Although his personal character
and integrity were as unquestioned as those of Hayes, and although he
was a man of cultured tastes, well-informed, thoughtful and
conscientious, it must be admitted that he lacked robust leadership and
breadth of vision, and that he did not understand the real purposes of
the policies which his party associates were embarking upon, or if he
did that he tamely acquiesced in them. The party leaders were soon
engaged in initiating practices and passing legislation which would
strengthen the organization with certain groups of interested persons.
Harrison, conscientious but aloof, provided no compelling force to turn
attention toward wider and deeper needs.

Two appointments to the cabinet were important. Since Blaine was the
foremost leader of the party and had done much to bring about the
election of Harrison, it was well-nigh impossible for the latter to
fail to offer him the position of Secretary of State. The appointment
was so natural that popular opinion looked upon it as the only
possibility, yet the natures of the two men were so diverse and their
positions in the party so different that friction seemed likely to
result. Even before the administration began it was freely predicted
that Blaine would "dominate" the cabinet, a prophecy that might well
create a feeling of restraint between the two. The invitation to John
Wanamaker to become Postmaster-General was regarded as significant.
Wanamaker was a wealthy merchant of Philadelphia, who had organized an
advisory campaign committee of business men which contributed and
expended large sums of money during the canvass. Critical reformers
like the editor of _The Nation_ were not slow to connect Wanamaker's
large contribution to the campaign fund with his elevation to the
cabinet, and to suggest that the business interests were being brought
into close relations with the administration. T.C. Platt, expectant of
a return for his campaign assistance, in the form of a cabinet
position, and in fact understanding that a pledge had been made that he
would be appointed, found himself superseded by William Windom of
Minnesota in the Treasury and became a bitter opponent of the
President.[3]

It was an odd turn of the fortune of politics that brought Benjamin
Harrison face to face with the responsibility for furthering the cause
of civil service reform--the same Harrison who, as a senator, had
sneered at Cleveland for surrendering to difficulties. The party
platform had urged the continuation of reform, which had been
"auspiciously begun under the Republican administration" and had
declared that the party promises would not be broken as Democratic
pledges had been; and Harrison had announced his adherence to the party
statement. In some respects real progress was made. Secretary of the
Navy Tracy introduced reform methods in his department. The appointment
of Theodore Roosevelt to the Civil Service Commission was productive of
good results. The work of reform was defended forcefully and
successfully; its opponents were challenged to substantiate their
charges. When Senator Gorman declared that in an examination for letter
carriers in Baltimore the candidates were asked to tell the most direct
route from Baltimore to China, Roosevelt at once wrote asking him to
state the time and place of the examination himself or to send somebody
to look over the papers, copies of which were in the commission's
office. The senator did not reply.

The removal of office holders, however, proceeded with amazing
rapidity. The First Assistant Postmaster-General was J.S. Clarkson, who
had been vice-chairman of the Republican National Campaign Committee.
The speed with which he cleared the service of Democrats earned him the
title "headsman" and is indicated by the estimate that he removed one
every three minutes for the first year. When the force of clerks was
increased for the taking of the census of 1890, the superintendent of
the census office found himself "waist deep in congressmen" trying to
get places for friends. The Republican postmaster of New York who had
been continued by Cleveland was not re-appointed. It was soon
discovered, also, that the President was placing his own and his wife's
relatives in office and giving positions to large numbers of newspaper
editors, thus indirectly subsidizing the press. The Commissioner of
Pensions, Corporal James Tanner, distributed pensions so freely as to
arouse wide-spread comment and was soon relieved of his position.[4]

Curtis, addressing the National Civil Service Reform League, flayed the
President because he had despoiled the service. A Republican newspaper,
he declared, had said that the administration whistled reform down the
wind "as remorselessly as it would dismiss an objectionable tramp."
Prominent members of the party went to the President in person to urge
on him the redemption of the platform promises.

Although progress was not general, nevertheless there were particular
reforms that commended themselves. The offensive Clarkson gave way to
hostile criticism and retired. During the last half of the
administration, the civil service rules were amended so as to add a
considerable number of employees to the classified service, especially
in the post office department. Quay and Dudley found their methods
condemned by public opinion and resigned their positions on the
National Republican Committee.[5]

Aside from his choice of subordinates, Harrison contributed little to
the political history of his administration, for the leadership was
seized by a small coterie of extreme Republicans in the House of
Representatives, of whom the chief figure was the Speaker, Thomas B.
Reed. The House which had been elected with Harrison contained 159
Democrats and 166 Republicans. The Republican majority was too slight
for safety, for the questions which were coming before Congress were
such as to arouse party feeling to a high pitch. The Republicans felt
themselves commissioned, by a successful election, to put the party
program into force, but so powerful a minority could readily block any
legislation under the existing parliamentary rules. Only Reed knew what
expedient would be resorted to in the attempt to put through the party
program, and not even he could guarantee that the adventure would be
successful.

Thomas B. Reed had long represented Maine in the House of
Representatives. He was a man of huge bulk, bland in appearance,
imperturbable in his serenity, caustic, concise and witty of tongue,
rough, sharp, strong, droll. In the cut-and-thrust of parliamentary
debate and manoeuvre, as well as in his knowledge of the intricacies of
procedure, Reed was a past master. He worsted his adversaries by
turning the laugh on them, and his stinging retorts, which swept the
House "like grapeshot," made him a powerful factor in partisan
contests.[6]

The political and economic philosophy of Reed and his associates was
unusually important, because it controlled their action during the time
when they dominated the House and determined the character of the
legislation passed during Harrison's time. When President Cleveland's
tariff message welded the Democrats together to demand reduction, it
likewise influenced the Republicans to adopt the other extreme. That is
not to say, of course, that the Republican attitude was due solely to
Cleveland, for the party was already committed to protectionism.
Nevertheless, many of its prominent leaders, including its presidents,
had urged revision. That recommendation was now no longer heard. Such
men as McKinley in the House fairly apotheosized the protective system.
The philosophy of the party leaders received full exposition in a
volume edited by John D. Long, ex-governor of Massachusetts, and
composed of articles written by sixteen of the most prominent
Republicans. It had been published during the campaign. The attitude of
the party toward its chief tenet was expressed in the phrase, "The
Republican party enacted a protective tariff which made the United
States the greatest manufacturing nation on earth"; and its conception
of the Democratic party in the statement that the Democrats were mainly
old slave-holders, liquor dealers and criminals in the great northern
cities. In the field of national expenditure, also, the party reacted
from Cleveland's frugality. Senator Dolph frankly urged the expenditure
of the surplus revenue rather than the reduction of taxation. McKinley
took the position that prices might be too low. "I do not prize the word
cheap," he said; "cheap merchandise means cheap men and cheap men mean
a cheap country." Harrison remarked that it was "no time to be weighing
the claims of old soldiers with apothecary's scales." This philosophy
was now to have its trial, but first the obstructive power of the
minority must be curbed. Reed's plan for accomplishing this result
appeared late in January, 1890.

A contested election case was up for decision in the House. The roll
was called and three less than a quorum of representatives answered.
Scores of Democrats were present, but by merely refusing to answer to
their names they could be officially absent. Unless the Republicans
could provide a quorum--that is, more than half the total membership of
the chamber of their own number, they were helpless. Clearly they
could not muster their full force at all times and especially on
questions upon which the party might be divided. On the other hand, the
right to refuse to vote was a long-standing one and had been used over
and over again by Republicans as well as Democrats. Reed, however, had
made up his mind to cut the Gordian knot. Looking over the House he
called the names of about forty Democrats, directed the clerk to make
note of them and then declared a quorum present. The meaning of the act
was not lost on the opposition. Pandemonium broke loose. Members rushed
up the aisle as if to attack the Speaker, but Reed, huge, fearless and
undisturbed, stood his ground. The Democrats hissed and jeered and
denounced him with a wrath which was not mollified by the derisive
laughter of the Republicans, who were surprised by the ruling, but
rallied to their leader. Two days later, when a member moved to
adjourn, the Speaker ruled the motion out of order and refused to
entertain any appeal from his decision. He then firmly but quietly
stated his belief that the will of the majority ought not to be
nullified by a minority and that if parliamentary rules were used
solely for purposes of delay, it was the duty of the Speaker to take
"the proper course."

The rules committee then presented a series of recommendations designed
to expedite business. One of the proposed changes provided that the
chair should entertain no dilatory motions. Such motions, whose purpose
was merely to obstruct action, had long been common. The Republicans
were said to have alternated motions to adjourn and to fix a day for
adjournment no less than one hundred and twenty-eight times in an
attempt to defeat the Kansas-Nebraska bill in 1854. The second rule
allowed the speaker to count members who were present and not voting in
determining whether a quorum was present. Other rules systematized
procedure and facilitated the passage of legislation. The Democrats
raged, denounced Reed as a "Czar," fought against the adoption of the
rules--all to no avail. The majority had its way; the Speaker
dominated legislation.[7]

The efficacy of the Reed reforms in expediting legislation was quickly
demonstrated. One of the earliest proposals to pass the House was Henry
Cabot Lodge's federal election law, which was intended to insure
federal control at polling places. Theoretically the measure was
applicable to the North as well as to the South, but no doubt existed
that it was really designed to prevent southern suppression of the
negro vote. The Democrats rallied to the opposition and denounced
Lodge's plan as a "force act." Despite objections it passed the House,
but it languished in the Senate and finally was abandoned. The generous
expenditure policy which the new philosophy called for brought forth
certain increases which were noteworthy. The dependent pension bill
which Cleveland had vetoed was passed, and a direct tax which had been
levied on the states during the Civil War was refunded. Another extreme
party measure was the Sherman silver act which became law on July 14,
1890. By it, 4,500,000 ounces of silver were to be purchased each
month. Its partisan character was indicated by the fact that no
Republicans voted against it, and no Democrats for it. Since the amount
of silver to be purchased was practically the total output of the
country, it was evident that the western mine owners were receiving the
same attention that was being accorded manufacturers who sought
protective tariff laws. Indeed, western Republicans, who were opposed
to the high tariff which eastern Republicans favored, were brought to
support such legislation only by a bargain through which each side
assisted the other in getting what it desired.[8]

The tariff measure which was thus entwined with the silver bill was
intended to carry out the pledge made in the party platform. Harrison
had early called the attention of Congress to the need of a reduction
of the surplus, had urged the passage of a new tariff law and the
removal of the tobacco tax which, he declared, would take a burden from
an "important agricultural product." The framing of the bill was in the
hands of William McKinley, the chairman of the Committee on Ways and
Means. McKinley was a thorough-going protectionist whose attitude on
the question had already been expressed somewhat as follows: previous
Democratic tariffs have brought the country to the brink of financial
ruin; without the protective tariff English manufacturers would
monopolize American markets; under the protective system the foreign
manufacturer largely pays the tax through lessened profits; under
protection the American laborer is the best paid, clothed and contented
workingman in the world; since it is necessary, then, to preserve
protection, the surplus should be reduced by the elimination of the
internal revenues; and protective tariff duties should be raised and
retained, not gradually lowered and done away with.

The Committee early proceeded to hold public hearings at which
testimony was taken, and to which manufacturers came from all over the
country to make known what duties they thought they ought to have. The
bill which was finally presented to the House proposed a level of
duties which was so high that it has generally been considered the
extreme of protection. McKinley himself justified the high rates only
on the ground that without them the bill could not be passed. With the
help of the Reed rules and the western Republicans the McKinley tariff
reached the President and was signed by him on October 1, 1890. It went
into effect at once.

The more prominent features of the measure sprang from the tariff creed
which had been advocated through the campaign. In order to conciliate
the farmers, the protective principle was applied to agricultural
products, and tariffs were laid on such articles as cereals, potatoes
and flax. On the cheaper grades of wool and woolens and on carpet wools
there was a slight rise over even the rates of 1883. On the higher
grades of woolen, linen and clothing the increase was marked. The duty
on raw sugar was removed and one-half cent per pound retained on the
refined product, but domestic sugar producers were given a bounty of
two cents a pound in order to protect them against the free importation
of the raw material. As the sugar duty had been productive of large
amounts of revenue, its remission reduced the surplus by about sixty to
seventy millions of dollars. In order to encourage the manufacture of
tin-plates, a considerable duty was imposed, which was to cease after
1897 unless domestic production reached specified amounts. As the
result of Blaine's urgency, a reciprocity feature was introduced. The
usual plan had been to reduce duties on certain products in case
concessions to American goods were given by the exporting countries,
but in the McKinley act the Senate inserted a novel provision. Instead
of being given power to lower duties in case reciprocal reductions were
made, the President was authorized to impose duties on certain articles
on the free list when the exporting nation levied "unjust or
unreasonable" customs charges on American products. It was expected
that this plan would be applied to Latin-American countries and would
increase our exports to them in return for sugar, molasses, tea, coffee
and hides. In general, the McKinley act was the climax of protection.
Under the impetus of President Cleveland's reduction challenge, the
Republican party had recoiled to the extreme.

The high rates levied by the new tariff act were quickly reflected in
retail prices and caused immediate and wide-spread discontent. The
benefits which the farmer had been led to expect did not put in their
appearance. Unhappily for McKinley and his associates the congressional
elections occurred early in November, scarcely a month after the new
law went into effect, and when the dissatisfaction was at its height.
The result was a stinging defeat for the Republicans. The 159 Democrats
were increased to 235, and the 166 Republicans dwindled to 88. Even in
New England the Democrats gained eleven members, in New York eight, and
in Iowa five. In Wisconsin not one Republican survived, and among the
lost in Ohio was McKinley himself.

Although the Republicans retained control of the Senate after 1890, the
Democratic House brought an end for a time to the domination of Reed
and the primacy of the lower chamber in the government. Such extreme
legislation as had characterized the first half of the Harrison regime
stopped abruptly. The role played in all this by Harrison himself seems
to have been a minor one. Many of his recommendations lacked the solid
character of those made by Hayes, Arthur and Cleveland, and he did not
make his influence felt in connection with the silver legislation, of
which he probably disapproved. It is significant that the one piece of
legislation which had the most enduring results was not a partisan act.
This act, the Sherman Anti-Trust law, demands attention in detail.


BIBLIOGRAPHICAL NOTE

In addition to the general and special works already mentioned, C.
Hedges, _Benjamin Harrison: Speeches_ (1892), provides useful material;
Cleveland's tariff message of Dec. 6, 1887 is in J.D. Richardson,
_Messages and Papers of the Presidents_, VIII, 580-591.

On the administration, and particularly the ascendancy of the House of
Representatives under Reed, consult: De A.S. Alexander, _History and
Procedure of the House of Representatives_ (1916); Mary P. Follett,
_Speaker of the House of Representatives_ (1896); C.S. Olcott, _William
McKinley_ (2 vols., 1916); J.G. Cannon in _Harper's Magazine_ (Mar.,
1920); _Annual Cyclopaedia_, 1890, pp. 181-191; S.W. McCall, _Thomas B.
Reed_ (1914), well written, although adding little to what was already
known; H.D. Croly, _Marcus A. Hanna_ (1912); W.D. Foulke, _Fighting the
Spoilsman_ (1919), on Harrison and the civil service; G.W. Curtis,
_Orations and Addresses_ (2 vols., 1894), summarizes the
administration's attitude toward civil service; T.B. Reed, _Reed's
Rules, A Manual of General Parliamentary Law_ (1894), gives a concise
summary of parliamentary conditions from Reed's standpoint; H.B.
Fuller, _The Speakers of the House_ (1909), excellent on the personal
side. The tariff is well treated in Stanwood, Taussig and Tarbell. On
pensions consult W.H. Glasson, _History of Military Pension Legislation
in the United States_ (1900), or better, the same author's _Federal
Military Pensions in the United States_ (1918).

       *       *       *       *       *

[1] The vice-presidential candidate was Allan G. Thurman of Ohio,
affectionately known as the "noble old Roman," one of whose titles to
fame was the ownership of a large red bandanna handkerchief which he
nourished on all occasions.

[2] A party worker who realized the opportunity which this fact
presented complained that Pennsylvania manufacturers who made fortunes
under protection did not contribute to the Republican campaign fund,
and remarked: "If I had my way about it I would put the manufacturers
of Pennsylvania under the fire and fry all the fat out of them."

[3] The remaining members of the cabinet were: Redfield Proctor, Vt.,
Secretary of War; W.H.H. Miller, Ind., Attorney-General; B.F. Tracy,
N.Y., Secretary of the Navy; J.W. Noble, Mo., Secretary of the
Interior; J.M. Rusk, Wis., Secretary of Agriculture.

[4] Corporal Tanner is commonly supposed to have been so anxious to
have a hand in the generous distribution of government revenue among
the old soldiers that he declared one morning as he seated himself at
his desk, "God help the surplus." This is a mistake, although the
Corporal seems to have been more ready than the President to act
quickly and generously on claims.

[5] The open character of the financial corruption of the campaign
also gave impetus to the movement for the secret or Australian ballot
which was first introduced in Louisville, Ky., on Feb. 28, 1888, and in
Massachusetts on May 29, of the same year. Another reform movement was
that which resulted in the destruction of the Louisiana lottery. Cf.
A.K. McClure, _Recollections_, 173-183, and Peck, _Twenty Years_,
215-220.

[6] An incident which occurred when he was not speaker may serve to
illustrate the manner in which he routed his opponents. Representative
Springer, of Illinois, who had a reputation for loquacity and
insincerity, once asked for unanimous consent to correct a statement
which he had previously made in debate. "No correction needed," shouted
Reed. "We didn't think it was so when you made it."

[7] In his _Manual of General Parliamentary Law_, Reed declared that
the House prior to 1890 was the most unwieldy parliamentary body in the
world. Three resolute men, he asserted, could stop all public business.
A few years later, when the Democrats were in power, they adopted the
plans which Reed had so successfully used.

[8] These acts were part of the general financial history of the
period and in that connection demand fuller discussion at a later
point. Cf. Chap. XV.




CHAPTER XI


INDUSTRY AND _LAISSEZ FAIRE_

About the time the Sherman Anti-trust law was being passed, in 1890,
Henry D. Lloyd was writing his book _Wealth Against Commonwealth_, in
which occurred a memorable passage:

    A small number of men are obtaining the power to forbid any but
    themselves to supply the people with fire in nearly every form known
    to modern life and industry, from matches to locomotives and
    electricity. They control our hard coal and much of the soft, and
    stoves, furnaces, and steam and hot-water heaters; the governors on
    steam-boilers and the boilers; gas and gas-fixtures; natural gas and
    gas-pipes; electric lighting, and all the appurtenances. You cannot
    free yourself by changing from electricity to gas, or from the gas
    of the city to the gas of the fields. If you fly from kerosene to
    candles, you are still under the ban.

To understand the dangers of the monopolies which Lloyd feared and
denounced, it is necessary to know the principal features in the
development of American industry from the close of the Civil War to
1890.

It will be remembered that the consolidation of small railroad lines
into large systems was accompanied by such advantages to the companies
and to the travelling public, as to demonstrate that combination was the
inevitable order of the day. The similar integration of small industrial
and commercial enterprises took place more slowly between 1870 and 1890,
but the process was no less inevitable on that account. The census of
1890 indicated that the production of manufactured articles had greatly
increased since 1870; more capital was engaged; the product was more
valuable; and more workmen were employed. Nevertheless the number of
establishments which were in operation had shown a considerable decline
in many industries. An army of 100,000 employees represented the
expansion of the wage-earning force in the iron and steel works, for
example, and $270,000,000 the increase in the value of their products;
yet the number of establishments engaged showed a shrinkage of nearly
fourteen per cent. The workers in the textile mills grew from 275,000 to
512,000, and the capital outlay from $300,000,000 to $750,000,000, but
the number of factories declined from 4,790 to 4,114. A cartoon in
_Puck_ on January 26, 1881, remarked that "the telegraph companies have
been consolidated, which in simple language means that Mr. Jay Gould
controls every wire in the United States over which a telegram can be
sent."

Some of the reasons for the prevalent tendency toward combination were
not hard to discover. In the first place, although industrial
organizations fought one another with the utmost bitterness, it was in
the nature of things for them to combine if threatened by any common
foe. Moreover, production on a large scale made possible savings and
improvements that were outside the grasp of more modest enterprises;
buying and selling large quantities of goods commanded opportunities for
profit; waste products could be made use of and costly scientific
investigations conducted in order to discover improved methods, overcome
difficulties and open new avenues of activity; large salaries and
important positions could be offered to men of executive capacity; and
expensive equipment could be purchased and utilized.[1] An effective
force which tended to drive industries to combine was the cut-throat
competition which prevailed. Herbert Croly in his stimulating book _The
Promise of American Life_ vividly describes the bitter, warlike
character of industrial competition after 1865. Competition was battle
to the knife and tomahawk. The leaders were constantly seeking bigger
operations, to which the bigger risks only added zest. A company might
be making unbelievable profits one year and "skirting" bankruptcy the
next. Exciting as all this was, however, the desire for adventure was
not as powerful as the desire for profits, and cut-throat competition in
industry led as naturally to combination, as rate-wars on the railroads
led to pooling agreements.

An important factor in the development of large corporations was the
increasing use of the corporation form of industrial organization, as
contrasted with the co-partnership plan. If a few men enter a
copartnership, each of them must supply a considerable amount of
capital; but if a corporation is formed and stock is sold, the par value
of the shares may be placed at a low figure--$100 or less, for
example--and thus a large number of persons may be able to establish an
industry which is far beyond the financial resources of any individual
or small group among them. The corporation, moreover, is relatively
permanent, for the death of one stock-holder among many is unimportant
as compared with that of one member of a co-partnership. In case of
disaster to the enterprise the liability of the stock-holder in a
corporation is limited to the amount which he has invested, while any
member of a partnership may be legally held for all the debts of the
organization. With such advantages in its favor the corporation plan
largely dominated the organization of industry.

The most famous example of combination before 1890 was the Standard Oil
Company, which was the cause of more litigation, more study and more
complaint than any other industrial organization that has ever existed
in America. In 1865 Rockefeller & Andrews started an oil-refining
business in Cleveland, Ohio. Samuel Andrews was a mechanical genius and
he attended to the technical end of the industry; John D. Rockefeller
had bargaining capacity, and to him fell the task of buying the crude
oil, providing barrels and other materials and selling the product. The
firm prospered. H.M. Flagler was taken into the company and a branch was
established in New York. In 1870 these three with a few others organized
the Standard Oil Company of Ohio, with a capitalization of a million
dollars. It controlled not over ten percent. of the business of
oil-refining in the United States at that time. But the oil business was
so profitable that capital flowed into it and competition became keen.
Rockefeller and some associates, therefore, devised the South
Improvement Company of Pennsylvania, a combination of refiners, headed
and controlled by the Standard, the purpose of which was to make
advantageous arrangements With the railroads for transportation
facilities. Early in 1872, a most remarkable contract was signed between
the company and the important railroads of the oil country--the
Pennsylvania, the New York Central and the Erie. By it the roads agreed
to establish certain freight rates from the crude-oil producing region
of western Pennsylvania to such refining and shipping centers as New
York, Philadelphia, Baltimore, Pittsburg and Cleveland. From these rates
the South Improvement Company was to receive substantial rebates,
amounting to forty or fifty per cent. on crude oil and twenty-five to
forty-five per cent. on refined. On their side the railroads were
promised the entire freight business of the Company, each to have an
assured proportion of the traffic, with freedom from rate-cutting
competition. All this was the common railroad practice of the times.

But another portion of the contract was not so common. It provided that
the roads should give the South Improvement Company rebates on all oil
shipped by its competitors and furnish it with full way-bills of all
such shipments each day. In other words, the Company was to know exactly
the amount of the business of its competitors and with whom it was being
done. The contract allowed the roads to make similar rebates with
anybody offering an equal amount of traffic, but the likelihood of such
an outcome was slender in the extreme. Armed with this powerful weapon,
Rockefeller entered upon a campaign to eliminate competition by offering
to buy out independent refiners either with cash or with Standard Oil
stock, at his estimate of the value of their property. Those who
objected to selling were shown that the alliance between the South
Improvement Company and the railroads was so strong that they faced the
alternative of giving way or being crushed. Of the twenty-six refineries
in Cleveland, at least twenty-one yielded. The capacity of the Standard
leaped from 1,500 to 10,000 barrels a day and it controlled a fifth of
the refining business of the country. When these facts came to be known
in the oil country, the bitter Oil War of 1872 began. Independent
producers joined to fight for existence, and at length the railroads
gave way and agreed to abandon the contract with the South Improvement
Company, and the legislature of Pennsylvania annulled its charter,
although in one way or another rebates continued and the absorption of
rivals went on. In 1882 the entire combination--thirty-nine refiners,
controlling ninety to ninety-five per cent. of the product--was
organized as the Standard Oil Trust. All stock-holders in the combining
companies surrendered their certificates and received in return receipts
or "trust-certificates," which showed the amount of the owner's interest
in the trust. In order to secure unity of purpose and management, the
affairs of the combination were put into the hands of nine trustees,
with Rockefeller at the head.

The wonderful success of the Standard Oil Company, however, was not due
solely to the alliance with the railroads, although this advantage came
at a strategic time when it was fighting for supremacy. Its marketing
department gave it an unenviable reputation, but achieved amazing
success. The department was organized to cover the country, find out
everything possible about competitors, and then kill them off by
price-cutting or other means. The great resources of the Company enabled
it to undersell rivals, going below cost if necessary, and thus wearing
out opposition. Continuity of control, also, contributed to Standard
success; the narrow limits of the area in which the crude oil was
produced before 1890 rendered the problem of securing a monopoly
somewhat easier; the organization was extremely efficient and the
constituent companies were stimulated to a high degree of productivity
by encouraging the spirit of emulation; men of ability were called to
its high positions; the policy of gaining the mastery over the trade in
petroleum and its products was kept definitely and persistently to the
front; and then there was John D. Rockefeller.

Rockefeller was what used to be called a "self-made" man. He began his
business life in Cleveland as a clerk at an extremely modest salary.
Capacity for details and for shrewd bargaining, patience, frugality,
seriousness, secretiveness, caution, an instinctive sense for business
openings, self-control--all these were characteristic both of the
Cleveland clerk and the later oil-refiner. In the bigger field he
developed a daring caution, a quick understanding of the value of new
inventions, a capacity for organization, quick grasp of essentials and a
resourcefulness that dominated the entire Standard combination. He built
his own barrels, owned the pipe-lines, tank-cars, tank-wagons and
warehouses. Consolidation, magnitude and financial returns were his
aims, and in achieving these he and his associates were so successful as
to make the Standard a leader in all branches of business, except the
ethics of industry. Litigation has been the constant accompaniment of
Standard progress.

Following the Standard Oil Company, other combinations found the trust
form of organization a convenient one. The cotton trust, the whiskey
trust, and the sugar, cotton bagging, copper and salt trusts made the
public familiar with the term. Moreover, popular suspicion and hostility
became aroused, and the word "trust" began to acquire something of the
unpleasant connotation which it later possessed.

Although it was upon the Standard Oil Company that people turned when
they denounced the trusts and feared or condemned their practices, the
principles to which the Standard adhered when under the strain of
competition were the practices which were followed by their
contemporaries, both big and little. When the Diamond Match Company, for
example, was before the Courts of Michigan in 1889, it appeared that the
organization was built up for the purpose of controlling the manufacture
and trade in matches in the United States and Canada. Its policy was to
buy up and "remove" competition, so that it might monopolize the
manufacture and sale of matches. It could then fix the price of its
commodity at such a point that it could recoup itself for the expense of
eliminating competitors and also make larger profits than were possible
when its rivals were active.

Still more dangerous was the combination of the hard coal operators. By
1873, six corporations owned both the hard coal deposits of Pennsylvania
and the railroads which made it possible to haul the coal out to the
markets. In the same year and later these companies made agreements
which determined the amounts of coal that they would mine, the price
which they would charge, and the proportion of the whole output that
each company would be allowed to handle. Independent operators--that is,
operators not in the combination--found their existence precarious in
the extreme, for their means of transportation was in the hands of the
six coal-carrying railroads, who could raise rates almost at will and
find reasons even for refusing service. The states were powerless to
remedy the situation because their authority did not extend to
interstate commerce, yet it was intolerable for a small group of
interested parties to have power to fix the output of so necessary a
commodity as coal, on no other basis than that provided by their own
desires.

Other abuses appeared which showed that industrial combinations were
open to many of the complaints which, in connection with the railroads,
had led to the Interstate Commerce Act. Industrial pools resembled
railroad pools and were objected to for similar reasons. Bankers and
others who organized combinations were given returns that seemed as
extravagant as the prices paid to railroad construction companies; the
issues of the stock of corporations were bought and sold by their own
officers for speculative purposes; and stock-watering was as common as
in railroading. The industrial combinations also had somewhat the same
effect on politics that the railroads had. Lloyd declared that the
Standard Oil Company had done everything with the Pennsylvania
legislature except refine it.

One of the most noted cases of corporation influence in politics was
that of the election of Senator Henry B. Payne of Ohio. In 1886 the
legislature of the state requested the United States Senate to
investigate the election of Payne because of charges of Standard Oil
influence. The debate over the case showed clearly the belief on the
part of many that the Standard, which controlled "business, railroads,
men and things" was also choosing United States senators. Senator Hoar
raised the question whether the Standard was represented in the Senate
and even in the Cabinet. In denying any connection with the Oil Company,
Payne himself declared that no institution or association had been "to
so large an expense in money" to accomplish his defeat when he was a
candidate for election to the lower house. Popular suspicion seemed
confirmed, therefore, that the Company was taking an active share in
government. Whether the trust was for or against Payne made little
difference.

A complaint that brought the trust problem to the attention of many who
were not interested in its other aspects was the treatment accorded
independent producers. The rough-shod methods employed by the Standard
Oil Company, the Diamond Match Company and the coal operators were
concretely illustrated in many a city and town by such incidents as that
of a Pennsylvania butcher mentioned by Lloyd. An agent of the great meat
slaughtering firms ordered the butcher to cease slaughtering cattle, and
when he refused the agent informed him that his business would be
destroyed. He then found himself unable to buy any meat whatever from
Chicago, the meat-packing center, and discovered that the railroad would
not furnish cars to transport his supplies. Faced by such overwhelming
force, the independent producer was generally compelled to give way to
the demands of the big concerns or be driven to the wall. The
helplessness of the individual under such conditions was strikingly
expressed by Mr. Justice Harlan of the Supreme Court in a decision in a
suit against the Standard Oil Company:

    All who recall the condition of the country in 1890 will remember
    that there was everywhere, among the people generally, a deep
    feeling of unrest. The Nation had been rid of human slavery ...
    but the conviction was universal that the country was in real danger
    from another kind of slavery sought to be fastened on the American
    people, namely, the slavery that would result from aggregations of
    capital in the hands of a few ... controlling, for their own ...
    advantage exclusively, the entire business of the country, including
    the production and sale of the necessaries of life.

Observers noted that fortunes which outstripped the possessions of
princes were being amassed for the few by combinations which sometimes,
if not frequently, resorted to illegal and unfair practices, and they
compared these conditions with the labor unrest, the discontent and the
poverty which was the lot of the many.

In the meanwhile there had arisen a growing demand for action which
would give relief from the conditions just described. As early as 1879
the Hepburn committee appointed by the New York Assembly had
investigated the railroads and had made public a mass of information
concerning the relation of the transportation system to the industrial
combinations. In 1880 Henry George had published _Progress and Poverty_
in which he had contended that the entire burden of taxation should be
laid upon land values, in order to overcome the advantage which the
ownership of land gave to monopoly. In 1881 Henry D. Lloyd had fired
his first volley, "The Story of a Great Monopoly," an attack on the
Standard Oil Company which was published in the _Atlantic Monthly_ and
which caused that number of the periodical to go through seven
editions.[2] In 1888 Edward Bellamy's _Looking Backward_ had pictured
a socialized Utopian state in which the luxuries as well as the
necessities of life were produced for the common benefit of all the
people. Societies had been formed for the propagation of Bellamy's
ideas, and the parlor study of socialism had become popular.

The platforms of the political parties had given evidence of a
continuing unrest without presenting any definite proposals for relief.
As far back as 1872 the Labor Reformers had condemned the "capitalists"
for importing Chinese laborers; in the same year the Republicans and
Democrats had opposed further grants of public land to corporations and
monopolies--referring in the main to the railroads; in 1880 the
Greenbackers and in 1884 the Anti-Monopolists, the Prohibitionists and
the Democrats had denounced the corporations and called for government
action to prevent or control them; and in 1888 the Union Labor party,
the Prohibitionists and the Republicans had urged legislation for doing
away with or regulating trusts and monopolies. By 1890 eight states had
already passed anti-trust laws. Among unorganized forces, possibly the
independent producers were as effective as any. Although usually
overcome by the superior strength of their big opponents, they
frequently conducted vigorous contests and sometimes carried the issue
to the courts where damaging evidence was made public.

The solution of the problem of trust control was not easy to discover.
The amount of property involved was so great that forceful legislation
would be fought to the last ditch; while legislation that was obviously
weak, on the other hand, would not satisfy public opinion. Public
officials were hopelessly divergent in their views. Cleveland had
called attention to the evils of the trusts in his tariff message of
1887, but had laid his emphasis on the need of reduced taxation rather
than upon control of the great combinations. Blaine was opposed to
federal action. Thomas B. Reed had characteristically ridiculed the
idea that monopolies existed:

    And yet, outside the Patent Office there are no monopolies in this
    country, and there never can be. Ah, but what is that I see on the
    far horizon's edge, with tongue of lambent flame and eye of forked
    fire, serpent-headed and griffin-clawed?

Surely it must be the great new chimera "Trust." Quick, cries every
masked member of the Ways and Means. Quick, let us lower the tariff.
Let us call in the British. Let them save our devastated homes.

More serious was the almost universal lack of knowledge of the elements
involved in the situation. Industrial leaders were unenlightened and
wrapped up in the attempt to outdo rivals who were equally
unenlightened and absorbed; the nation needed instruction and
leadership, and neither was to be found. Instead, the poorer classes
became more and more hostile to big business interests; the capitalist
class set itself stolidly to the preservation of its interests. The one
saw only the abuses, the other only the benefits of combinations.
Thoughtful men felt that industrialism was afflicted with a malady
which would kill the nation unless a remedy were found.

The legal and constitutional position of the trusts was almost
impregnable. Ever since the decision of the Supreme Court in the
Dartmouth College case, handed down in 1819, franchises and charters
granted by states to corporations had been regarded as contracts which
could not be altered by subsequent legislation. Moreover, the Court had
so interpreted the Fourteenth Amendment, as has been seen, that the
states had found great difficulty in framing regulatory legislation
that would pass muster before the judiciary.[3] It was doubtful
whether federal attempts at regulation would be more fortunate. More
fundamental still, for public opinion underlies even constitutional
interpretation, American industrial and commercial expansion had run
ahead of our conception of the possible and proper functions of
government. Government as the protector of property was an ancient
concept and commonly held in the United States; government as the
guardian of the individual against the powerful holder of a great deal
of property was a new idea and not generally looked upon with favor.

It has already been seen that the prevailing economic theory, _laissez
faire_, was diametrically opposed to government regulation of the
economic activities of the individual. According to this view,
unrestricted industrial liberty would result in adjustment by business
itself on honorable lines. Men whose integrity was such that they were
in control of great enterprises, asserted an attorney for the Standard
Oil Company, would be the first to realize that a fair policy toward
competitors and the public was the most successful policy. Combination
was declared to be inevitable in modern life and reductions in the
price of many commodities were pointed to as a justification for
leaving the trusts unhampered.

Public opinion, however, was reaching the point where it was prepared
to brush aside theoretical difficulties. President Harrison, Senator
Sherman and others urged action. Large numbers of anti-monopoly bills
were presented in Congress. The indifference of some members and the
opposition of others was somewhat neutralized by the fiery zeal of such
men as Senator Jones of Arkansas, who declared that the fortunes made
by the Standard Oil Company did not represent a single dollar of honest
toil or one trace of benefit to mankind. "The sugar trust," declared
the senator, "has its 'long, felonious fingers' at this moment in every
man's pocket in the United States, deftly extracting with the same
audacity the pennies from the pockets of the poor and the dollars from
the pockets of the rich."

After much study of the mass of suggested legislation, Congress relied
upon its constitutional power to regulate commerce among the several
states and passed the Sherman Anti-trust Act, which received President
Harrison's signature on July 2, 1890. Its most significant portions are
the following:

    Sec. 1. Every contract, combination in the form of trust or
    otherwise, or conspiracy, in restraint of trade or commerce among
    the several States, or with foreign nations, is ... illegal.

    Sec. 2. Every person who shall monopolize, or attempt to monopolize,
    or combine or conspire with any other such person ... to monopolize
    any part of the trade or commerce among the several States, or with
    foreign nations, shall be deemed guilty of misdemeanor.

The purpose of the framers of the Act seems clearly to have been to
draw up a general measure whose terms should be those usual in the
English common law and then rest on the assurance that the courts would
interpret its meaning in the light of former practice. For some
centuries restraint of trade had been considered illegal in England,
but no contract was held to be contrary to law if it provided only a
_reasonable_ restraint--that is, if the restraint was merely minor and
subsidiary. The Sherman act was a Senate measure, was presented from
the Judiciary Committee and was passed precisely as drawn up by it. In
speaking from the Committee, both Edmunds and Hoar took the attitude
which the latter expressed as follows: "The great thing that this bill
does ... is to extend the common-law principles, which protected fair
competition ... in England, to international and interstate commerce in
the United States." Just how far the members of Congress who were not
on the Judiciary Committee of the Senate shared in this view or really
understood the bill can not be said. Indeed, many members of both
chambers absented themselves when the bill came to a vote.[4]

For a long time the Sherman Act like the Interstate Commerce Act was
singularly ineffective and futile. Trusts were nominally dissolved, but
the separate parts were conducted under a common and uniform policy by
the same board of managers. The Standard Oil Company changed its form
by selecting the Standard Oil Company of New Jersey as a "holding
corporation." Stock of the members of the combination was exchanged for
stock in the New Jersey organization, leaving control in the same hands
as before. The "same business was carried on in the same way but 'under
a new sign.'" The wide variety of conditions tolerated under the
corporation laws of the several states made confusion worse confounded.
In its early attempts to convict corporations of violation of the law,
the government was uniformly defeated.

In 1893 came the climax of futility. The American Sugar Refining
Company had purchased refineries in Philadelphia which enabled it to
control, with its other plants, ninety-eight per cent. of the refining
business in the country. The government asked the courts to cancel the
purchase on the ground that it was contrary to the Sherman law, and to
order the return of the properties to their former owners. The Supreme
Court declared that the mere purchase of sugar refineries was not an
act of interstate commerce and that it could not be said to restrain
such trade, and it refused to grant the request of the government.
Unhappily the prosecuting officers of the Attorney-General's office had
drawn up their case badly, making their complaint the purchase, not the
resulting restraint. No direct evidence was presented to show that
interstate commerce in sugar and the control of the sugar business and
of prices were the chief objects of the combination. To the public it
seemed that the corporations were impregnable, for even the United
States government could not control them.


BIBLIOGRAPHICAL NOTE

The early history of anti-trust agitation centers about Henry D. Lloyd.
His earliest article, "The Story of a Great Monopoly," is in _The
Atlantic Monthly_ (Mar., 1881); his classic account of trust abuses is
_Wealth against Commonwealth_ (1894); consult also C.A. Lloyd, _Henry
D. Lloyd_ (2 vols., 1912). Early and valuable articles in periodicals
are in _Political Science Quarterly_, 1888, pp. 78-98; 1889, pp.
296-319; W.Z. Ripley, _Trusts, Pools, and Corporations_ (rev. ed.,
1916), is useful; B.J. Hendrick, _Age of Big Business_ (1919), is
interesting and contains a bibliography. Ida M. Tarbell, _History of
the Standard Oil Company_ (2 vols., 1904), is carefully done and a
pioneer work. Other valuable accounts are: S.C.T. Dodd, _Trusts_
(1900), by a former Standard Oil attorney; Eliot Jones, _The Anthracite
Coal Combination in the United States_ (1914); J.W. Jenks, _Trust
Problem_ (1900), contains a summary of the economies of large scale
production; J.W. Jenks and W.E. Clark, _The Trust Problem_ (4th ed.,
1917), is scholarly and complete; J.D. Rockefeller, _Random
Reminiscences of Men and Events_ (1916), is a brief defence of the
Standard Oil Company; W.H. Taft, _Anti-Trust Act and the Supreme Court_
(1914), summarizes a few important decisions on the Sherman law. Edward
Bellamy, _Looking Backward_ (1888), describes an economic Utopia. Early
proposed anti-trust laws, together with the Congressional debates on
the subject are in _Senate Documents_, 57th Congress, 2nd session, vol.
14, No. 147 (Serial Number 4428). No complete historical study has yet
been made of the effects of industrial development, immediately after
the Civil War, on politics and the structure of American society.

       *       *       *       *       *

[1] Charles M. Schwab mentions an unusual example. Under the direction
of Andrew Carnegie, the wealthy steel magnate, he had a new mill
erected, which seemed likely to meet all the demands which would be
placed upon it. But in the process of building it Schwab had seen a
single way in which it could be improved. Carnegie at once gave orders
to have the mill taken down before being used at all, and rebuilt on
the improved plan.

[2] It was not until 1894 that Lloyd published _Wealth Against
Commonwealth_, but his pen had been busy constantly between 1881 and
1894.

[3] Cf. above, pp. 89-93, on Fourteenth Amendment.

[4] The authorship of the Sherman law has often been a source of
controversy. Senator John Sherman, as well as other members, introduced
anti-trust bills in the Senate in 1888. Senator Sherman's proposal was
later referred to the Judiciary Committee, of which he was not a
member. The Committee thoroughly revised it. Senator Hoar, who was on
the Committee, thought he remembered having written it word for word as
it was adopted. Recent investigation seems to prove that the senator's
recollection was faulty and that Edmunds wrote most of it, while Hoar,
Ingalls and George wrote a section each and Evarts part of a sentence.
If this is the fact, it seems most nearly accurate to say that Sherman
started the enterprise and that almost every member of the Judiciary
committee, especially Edmunds, shared in its completion.




CHAPTER XII


DEMOCRATIC DEMORALIZATION

In view of the fact that Harrison had been successful in 1888 and that
Cleveland had been the most able Democratic leader since the Civil War,
it seemed natural that their parties should renominate them in 1892.
Yet the men at the oars in the Republican organization were far from
enthusiastic over their leader. It is probable that Harrison did not
like the role of dispenser of patronage and that he indicated the fact
in dealing with his party associates; at any rate, he estranged such
powerful leaders as Platt, Quay and Reed by his neglect of them in
disposing of appointments. The reformers were no better satisfied; much
had been expected of him because his party had taken so definite a
stand in 1888, and when his choice of subordinates failed to meet
expectations, the scorn of the Independents found forceful vent. Among
the rank and file of his party, Harrison had aroused respect but no
great enthusiasm.

The friends of Blaine were still numerous and active, and they wished
to see their favorite in the executive chair. Perhaps Blaine felt that
there would be some impropriety in his becoming an active candidate
against his chief, while remaining at his post as Secretary of State;
at any rate he notified the chairman of the National Republican
Committee, early in 1892, that he was not a candidate for the
nomination. The demand for him, nevertheless, continued and relations
between him and Harrison seem to have become strained. Senator Cullom,
writing nearly twenty years afterward, related a conversation which he
had had with Harrison at the time. In substance, according to the
senator, the President declared that he had been doing the work of the
Department of State himself for a year or more, and that Blaine had
given out reports of what was being done and had taken the credit
himself. Cullom's recollection seems to have been accurate, at least as
far as relations between the two men were concerned, for three days
before the meeting of the Republican nominating convention Blaine sent
a curt note to the President resigning his office without giving any
reason, and asking that his withdrawal take effect immediately. The
President's reply accepting the resignation was equally cool and
uninforming. If Blaine expected to take any steps to gain the
nomination, the available time was far too short. That the act would be
interpreted as hostile to the interests of Harrison, however, admitted
of no doubt, and it therefore seems probable that Blaine had changed
his mind at a late day and really hoped that the party might choose
him.[1]

Despite Blaine's apparent change of purpose, it seemed necessary to
renominate Harrison in order to avoid the appearance of discrediting
his administration, and on the first ballot Harrison received 535 votes
to Blaine's 183 and was nominated. The only approach to excitement was
over the currency plank in the platform. Western delegates demanded the
free coinage of silver, which the East opposed. The plank adopted
declared that

    The Republican party demands the use of both gold and silver as
    standard money, with such restrictions and under such provisions,
    to be determined by legislation, as will secure the maintenance of
    the parity of values of the two metals.

It was a meaningless compromise, but it seems to have satisfied both
sides.

Cleveland, during the Harrison administration, had been an object of
much interest and not a little speculation. After seeing President
Harrison safely installed in office, he went to New York city where he
engaged in the practice of law. He himself thought that he was retiring
permanently and not a few enemies were quite willing that this should
be the case. The eminent Democratic editor, Henry Watterson, remarked
that Cleveland in New York was like a stone thrown into a river, "There
is a 'plunk,' a splash, and then silence.". He was constantly invited,
nevertheless, to address public assemblies, which provided ample
opportunity for him to express his thoughts to the country. Moreover,
the McKinley Act of 1890 and the political reversal which followed
brought renewed attention to the tariff message of 1887 and to its
author. In February, 1891, Cleveland was asked to address a meeting of
New York business men which had been called by the Reform Club to
express opposition to the free coinage of silver. The question of the
increased use of silver as a circulating medium, as has been seen, was
a controverted one; neither party was prepared to take a definite
stand, and, indeed, division of opinion had taken place on sectional
rather than partisan lines. While the subject was in this unsettled
condition Cleveland received his invitation to the Reform Club, and was
urged by some of his advisors not to endanger his chances of
renomination by taking sides on the issue. The counsel had no more
effect than similar advice had produced in 1887 when the tariff was in
the same unsettled condition. Although unable to attend, Cleveland
wrote a letter in which he characterized the experiment of free coinage
as "dangerous and reckless." Whether right or wrong, he was definite;
people who could not understand the intricacies of currency standards
and the arguments of the experts understood exactly what Cleveland
meant. Little doubt now existed but that the name of the ex-president
would be a powerful one before the nominating convention, for he would
have the populous East with him on the currency issue--unless David B.
Hill should upset expectations.

Hill was an example of the shrewd politician. Like Platt, whom he
resembled in many ways, he was absorbed in the machinery and
organization of politics, rather than in issues and policies. Beginning
in 1870, when he was but twenty-seven years of age, he had held public
office almost continuously. In the state assembly, as Mayor of Elmira,
as Lieutenant-Governor with Cleveland and later as Governor, he
developed an unrivalled knowledge of New York as a political arena. In
1892 he was at the height of his power and the presidency seemed to be
within his grasp. The methods which he used were typical of the
man--the manipulation of the machinery of nomination.

The national Democratic nominating convention was called for June 21,
but the New York state Democratic committee announced that the state
convention for the choice of delegates would meet on February 22. So
early a meeting, four months before the national convention, was
unprecedented, and at once it became clear that a purpose lay behind
the call. It was to procure the election of members to the state
convention who would vote for Hill delegates to the nominating
convention, before Cleveland's supporters could organize in opposition.
Furthermore, it was expected that the action of New York would
influence other states where sentiment for Cleveland was not strong.
Hill's plan worked out as he had expected--at least in so far as the
state convention was concerned--for delegates pledged to him were
chosen. Cleveland's supporters, however, denounced the "snap
convention" and a factional quarrel arose between the "snappers" and
the "anti-snappers"; outside of New York it was so obvious that the
snap convention was a mere political trick that the Hill cause was
scarcely benefited by it. Delegates were chosen in other parts of the
country who desired the nomination of Cleveland.

The convention met in Chicago on June 21 and proceeded at once to adopt
a platform of principles. The silver plank was hardly distinguishable
from that of the Republicans, except that it was enshrouded with a
trifle more of ambiguity. The adoption of a tariff plank elicited
considerable difference of opinion, but the final result was an extreme
statement of Democratic belief. Instead of adopting the cautious
position taken in 1884, the convention declared that the constitutional
power of the federal government was limited to the collection of tariff
duties for purposes of revenue only, and denounced the McKinley act as
the "culminating atrocity of class legislation."

Although it was evident when the convention met, that the chances of
Hill for the nomination were slight indeed, the battle was far from
over. Hill was a "straight" party man, a fact which he reiterated again
and again in his famous remark, "I am a Democrat." Cleveland was not
strictly regular, a fact which Hill apparently intended to emphasize by
constant reference to his own beliefs. The oratorical champion of the
Hill delegation was Bourke Cockran, an able and appealing stump
speaker. For two hours he urged that Cleveland could not carry the
pivotal state, New York, and that it was folly to attempt to elect a
man who was so handicapped. Eloquence, however, was of no avail. The
first ballot showed that the Hill strength was practically confined to
New York, and Cleveland was easily the party choice. For the
vice-presidency Adlai E. Stevenson, a partisan of the old school, was
chosen.

Among the smaller parties there appeared for the first time the
"People's Party," later and better known as the "Populists." Their
nominee was James B. Weaver, who had led the Greenbackers in 1880.
Their platform emphasized the economic burdens under which the poorer
classes were laboring and listed a series of extremely definite
demands.

The campaign was a quiet one as both Cleveland and Harrison had been
tried out before. So unenthusiastic were the usual political leaders
that Colonel Robert G. Ingersoll declared that each party would like
to beat the other without electing its own candidates. Although the
financial issue was kept in the background, the tariff was fought out
again somewhat as it had been in 1888. The New York _Sun_ shed some
asperity over the contest by calling the friends of Cleveland "the
adorers of fat witted mediocrity," and the nominee himself as the
"perpetual candidate" and the "stuffed prophet"; and then added a ray
of humor by advocating the election of Cleveland. The adoption of the
Australian ballot, before the election, in thirty-four states and
territories constituted an important reform; thereafter it was
impossible for "blocks of five" to march to the polls and deposit their
ballots within the sight of the purchaser. The Homestead strike near
Pittsburg, Pennsylvania, somewhat aided the Democrats. The Carnegie
Steel Company, having reduced wages, precipitated a strike which was
settled only through the use of the state militia. As the steel
industry was highly protected by the tariff, it appeared that the wages
of the laboring man were not so happily affected as Republican orators
had been asserting.[2]

The result of the election was astonishing. Cleveland carried not
merely the South but Connecticut, New York, New Jersey, Indiana,
Illinois, Wisconsin and California, while five of Michigan's fourteen
electoral votes and one of Ohio's twenty-three went to him. In the
last-named state, which had never gone against the Republicans, their
vote exceeded that of the Democrats by only 1,072. For the first time
since Buchanan's day, both Senate and House were to be Democratic. More
surprising and more significant for the future, was the strength of the
People's Party. Over a million ballots, twenty-two electoral votes, two
senators and eleven representatives were included among their trophies.
It was an important fact, moreover, that twenty-nine out of every
thirty votes cast for the People's Party were cast west of Pennsylvania
and south of Maryland. Something apparently was happening, in which the
East was not a sharer. The politician, particularly in the East, was
quite content to dismiss the Populists as "born-tired theorists,"
"quacks," "a clamoring brood of political rainmakers," and "stump
electricians," but the student of politics and history must appraise
the movement less provincially and with more information.

It was in the nature of things that the Populist movement should come
out of the West. From the days of Clay and Jackson the westerner had
been characterized by his self-confidence, his assertiveness and his
energy. He had possessed unlimited confidence in ordinary humanity,
been less inclined to heed authority and more ready to disregard
precedents and experience. He had expressed his ideals concretely, and
with vigor and assurance. He had broken an empire to the plow, suffered
severely from the buffetings of nature and had gradually worked out his
list of grievances. One or another of his complaints had been presented
before 1892 in the platforms of uninfluential third parties, but not
until that year did the dissenting movement reach large proportions.

It has already been seen that the people of the West were in revolt
against the management of the railroads. They saw roads going bankrupt,
to be sure, but the owners were making fortunes; they knew that lawyers
were being corrupted with free passes and the state legislatures
manipulated by lobbyists; and they believed that rates were
extortionate. The seizure and purchase of public land, sometimes
contrary to the letter of the law, more often contrary to its spirit,
was looked upon as an intolerable evil. Moreover, the westerner was in
debt. He had borrowed from the East to buy his farm and his machinery
and to make both ends meet in years when the crops failed. In 1889 it
was estimated that seventy-five per cent. of the farms of Dakota were
mortgaged to a total of $50,000,000. Boston and other cities had scores
of agencies for the negotiation of western farm loans; Philadelphia
alone was said to absorb $15,000,000 annually. The advantage to the
West, if conditions were right, is too manifest to need explanation.
But sometimes the over-optimistic farmer borrowed too heavily;
sometimes the rates demanded of the needy westerners were usurious;
often it seemed as if interest charges were like "a mammoth sponge,"
constantly absorbing the labor of the husbandman. The demand of the
West for a greater currency supply has already been seen, for it
appeared in the platforms of minor parties immediately after the Civil
War. Sometimes it seemed as if nature, also, had entered a conspiracy
to increase the hardships of the farmer. During the eighties a series
of rainy years in the more arid parts of the plains encouraged the idea
that the rain belt was moving westward, and farmers took up land beyond
the line where adequate moisture could be relied upon. Then came drier
years; the corn withered to dry stalks; farms were more heavily
mortgaged or even abandoned; and discontent in the West grew fast.

The complaints of the westerner naturally found expression in the
agricultural organizations which already existed in many parts of the
country. The Grange had attacked some of the farmer's problems, but
interest in it as a political agency had died out. The National
Farmers' Alliance of 1880 and the National Farmers' Alliance and
Industrial Union somewhat later were both preceded and followed by many
smaller societies. Altogether their combined membership began to mount
into the millions. When, therefore, the Alliances began to turn away
from the mere discussion of agricultural grievances and toward the
betterment of conditions by means of legislation, and when their
principles began to be taken up by discontented labor organizations, it
looked as if they might constitute a force to be reckoned with.

The remedies which the Alliances suggested for current ills were
definite. Fundamentally they believed that the government, state and
federal, could remedy the economic distresses of the people and that it
ought to do so. At the present day such a suggestion seems commonplace
enough, but in the eighties the dominant theory was individualism--each
man for himself and let economic law remedy injustices--and the
Alliance program seemed like dreaded "socialism." The counterpart of
the demand for larger governmental activity was a call for the greater
participation of the people in the operation of the machinery of
legislation. This lay back of the demand for the initiative, the
referendum, and the popular election of senators. Currency ills could
be remedied, the farmers believed, by a national currency which should
be issued by the federal government only--not by national banks. They
desired the free coinage of silver and gold until the amount in
circulation should reach fifty dollars per capita. Lesser
recommendations were for an income tax and postal savings banks. In
relation to the transportation system, they declared that "the time has
come when the railroad corporations will either own the people or the
people must own the railroads." In order to prevent the waste of the
public land and to stop its being held for speculative purposes, they
urged that none be allowed to remain in the hands of aliens and that
all be taken away from the railroads and corporations which was in
excess of actual needs.

The power of the new movement first became evident in 1890 and
distinctly disturbed both the Republican and the Democratic leaders.
Determined to right their wrongs, the farmers deserted their parties in
thousands, flocked to conventions and crowded the country schoolhouses
for the discussion of methods and men. Perhaps it was true, as one of
their critics asserted, that they put a "gill of fact and grievance
into a gallon of falsehood and lurid declamation" so as to make an
"intoxicating mixture." If so, the mixture took immediate effect.
Alliance governors were elected in several southern states; many state
legislatures in the South and West had strong farmer delegations; and
several congressmen and senators were sent to Washington. Success in
1890 made the Alliances jubilant and they looked to the possibility of
a countrywide political organization and a share in the campaign of
1892. The first national convention was held in Omaha in July, 1892, at
which many of the farmers' organizations together with the Knights of
Labor and other groups were represented. The name "People's party" was
adopted, the principles just mentioned were set forth in a platform and
candidates nominated. In the ensuing election the party exhibited the
surprising strength which has been seen.

It has taken more time to describe the Populist movement than its
degree of success in 1892 would justify. But it deserves attention for
a variety of reasons. Its reform demands were important; it was a
striking indication of sectional economic interests; it gave evidence
of an effective participation in politics by the small farmers, the
mechanics and the less well-to-do professional people--the "middle
class," in a word; it was a long step toward an expansion of the
activities of the central government in the fields of economic and
social legislation; and finally it emphasized the significance of the
West, as a constructive force in American life. If the Populists should
capture one of the other parties or be captured by it, nobody could
foresee what the results would be on American political history.

The second administration of Grover Cleveland, from 1893 to 1897, was
the most important period of four years for half a century after the
Civil War. For twenty-five years after 1865 American politicians had
been sowing the wind. Issues had rarely been met man-fashion, in direct
combat; instead, they had been evaded, stated with skilful ambiguity,
or beclouded with ignorance and prejudice. Politics had been concerned
with the offices--the plunder of government. It could not be that the
whirlwind would never be reaped.

The situation in 1893 was one that might well have shaken the stoutest
heart. International difficulties were in sight that threatened unusual
dangers; labor troubles of unprecedented complexity and importance were
at hand; the question of the currency remained unsettled, the treasury
was in a critical condition, and an industrial panic had already begun.
Each of these difficulties will demand detailed discussion at a later
point.[3]

To no small degree, the settlement of the political and economic issues
before the country was complicated by the unmistakable drift toward
sectionalism, and by the particular characteristics of the President.
If the administration pressed a tariff reduction policy, it would
please the South and West but bring hostility in the East. The demands
of the West, so far as the Populists represented them, were for the
increased use of the powers of the federal government and the
application of those powers to social and economic problems; but the
party in power was traditionally attached to the doctrine of restricted
activity on the part of the central authority. The sectional aspects of
the silver question were notorious; and only the eastern Democrats
fully supported their leader in his stand on the issue.

The personal characteristics of President Cleveland have already
appeared.[4] He had a burdensome consciousness of his own individual
duty to conduct the business of his office with faithfulness; a
courageous sense of justice which impelled him to fight valiantly for a
cause that he deemed right, however unimportant or hopeless the cause
might be; a reformer's contempt for hypocrisy and shams, and a blunt
directness in freeing his mind about wrong of every kind. He had the
faults of his virtues, likewise. Sure of himself and of the right of
his position, he had the impatience of an unimaginative man with any
other point of view; he was intransigent, unyielding, rarely giving
way a step even to take two forward. It seems likely that his political
experience had accentuated this characteristic. For years he had thrown
aside the advice of his counsellors and had shown himself more nearly
right than they. As Mayor of Buffalo he had used the veto and had been
made Governor of the state; as Governor he had ruggedly made enemies
and had become President; as President he had flown in the face of
caution with his tariff message and his Reform Club letter and had
three times received a larger popular vote than his competitor. And
each time his plurality was greater than it had been before. If he
tended to become over-sure of himself, it should hardly occasion
surprise. Furthermore he looked upon the duties and possibilities of
the presidential office as fixed and stationary, rather than elastic
and developing. He was a strict constructionist and a rigid believer in
the checks and balances of the Constitution. Although constantly aware
of the needs and rights of the common people, such as composed the
Populist movement, his adherence to strict construction was so complete
that he was unable to advocate much of the federal legislation desired
by them. It was only with hesitation and constitutional doubts, for
example, that he had been able to sign even the Interstate Commerce
Act. In brief, then, the western demand for social and economic
legislation on a novel and unusual scale was to take its chances with
an honest, dogged believer in a restricted federal authority.

The experience of the administration with the patronage question
illustrates how much progress had been made in the direction of reform
since the beginning of Cleveland's first term in 1885. In the earlier
year it had required a bitter contest to make even the slightest
advance; in his second term he retained Roosevelt, a Republican
reformer, on the Commission and gradually extended the rules so as to
cover the government printing office, the internal revenue service, the
pension agencies, and messengers and other minor officials in the
departments in Washington. Finally on May 6, 1896, he approved an order
revising the rules, simplifying them and extending them to great
numbers of places not hitherto included, "the most valuable addition
ever made at one stroke to the competitive service." The net result was
that the number of positions in the classified service was more than
doubled between 1893 and 1897, making a total of 81,889 in a service of
somewhat over 200,000.[5] By the latter year the argument against
reform had largely been silenced. The dismal prediction of opponents
who had feared the establishment of an office-holding aristocracy had
turned out to have no foundation. Agreement was widespread that the
government service was greatly improved. There were still branches of
the service for the reformers to work upon but the great fight was over
and won.[6]

Although the Democrats came into power in 1893 largely on the tariff
issue, Cleveland felt that the most urgent need at the beginning of the
administration was the repeal of the part of the Sherman silver law
that provided for the purchase of 4,500,000 ounces of silver each
month. The financial and monetary aspects of this controversy demand
relation at another point.[7] Politically its results were important.
Western and southern Democrats, friendly to silver, fought bitterly
against the repeal, and became thoroughly hostile to Cleveland whom
they began to distrust as allied to the "money-power" of the East. At
the time, then, when the President was most in need of united partisan
support, he found his party crumbling into factions.

Other circumstances which have been mentioned combined to make the time
inauspicious for a revision of the tariff--the slight Democratic
majority in the Senate, the deficit caused by rising expenditure and
falling revenue, the imminent industrial panic and the prevailing labor
unrest. Nevertheless it seemed necessary to make the attempt. If the
results of the election of 1892 meant anything, they meant that the
Democrats were commissioned to revise the tariff.

The chairman of the House Committee on Ways and Means was William L.
Wilson, a sincere and well-read tariff reformer who had been a lawyer
and a college president, in addition to taking a practical interest in
politics. The measure which he presented to the House on December 19,
1893, was not a radical proposal, but it provided for considerable
tariff reductions and a tax on incomes over $4,000. There was a slight
defection in party support, but it was unimportant because of the large
majority which the Democrats possessed, and the bill passed the House
without unusual difficulty.

In the Senate a different situation presented itself. The Democratic
majority over the Republicans, provided the Populists voted with the
former, was only nine; and in case the Populists became disaffected,
the Democrats could outvote the opposition only by the narrow margin of
three, even if every member remained with his party. Such a degree of
unanimity, in the face of prevailing conditions, was extremely
unlikely. The Louisiana senators were insistent upon protection for
their sugar; Maryland, West Virginia and Alabama senators looked out
for coal and iron ore; Senator Hill of New York was unalterably opposed
to an income tax; Senator Murphy, of the same state, obtained high
duties on linen collars and cuffs; and Senators Gorman and Brice were
ready to aid the opposition unless appeased by definite bits of
protection which they demanded. Many years later Senator Cullom, a
Republican, explained the practical basis on which the Senate
proceeded: "The truth is, we were all--Democrats as well as
Republicans--trying to get in amendments in the interest of protecting
the industries of our respective States."

The 634 changes made in the Senate were, therefore, mainly in the
direction of lessening the reductions made by the House. After the bill
had passed the Senate, it was put into the hands of a conference
committee, where further changes were made. At this stage of the
proceedings, Wilson read to the House a letter from the President
condemning the form which the bill had taken under Senate management,
and branding the abandonment of Democratic principles as an example of
"party perfidy and party dishonor." The communication had no effect
except to intensify differences within the party, and senators made it
evident that they would have their way or kill the measure. The House
thereupon capitulated and accepted what became known as the
Wilson-Gorman act--a law which was only less protectionist than the
McKinley act. The President, chagrined at the breakdown of the party
program, allowed the act to pass without his signature, but expressed
his mingled disappointment and disgust in a letter to Representative
T.C. Catchings:

    There are provisions in this bill which are not in line with honest
    tariff reform.... Besides, there were ... incidents accompanying the
    passage of the bill ... which made every sincere tariff reformer
    unhappy.... I take my place with the rank and file of the Democratic
    party ... who refuse to accept the results embodied in this bill as
    the close of the war, who are not blinded to the fact that the
    livery of Democratic tariff reform has been stolen and worn in the
    service of Republican protection, and who have marked the places
    where the deadly blight of treason has blasted the counsels of the
    brave in their hour of might.

A few phases of the attempt at tariff reduction indicate the extent to
which political decay and especially Democratic demoralization had
gone. As it passed the House, the Wilson bill left both raw and refined
sugar on the free list. This was unsatisfactory to the Louisiana sugar
growers, who desired a protective duty on the raw product, and was
objected to by the Louisiana senators. On the other hand, the American
Sugar Refining Company, usually known as the "Sugar Trust," desired
free raw materials but sought protective duties on refined sugar. In
the Senate, a duty was placed on raw sugar, partly for revenue and
partly to satisfy the Louisiana senators. On refined sugar, rates were
fixed which were eminently satisfactory to the Trust. Rumors at once
began to be spread broadcast over the country that the sugar interests
had manipulated the Senate. The people were the more ready to believe
charges of this sort because of experience with previous tariff
legislation and because the Sugar Trust had been one of the earliest
and most feared of the monopolies which had already caused so much
uneasiness. A Senate committee was appointed, composed of two
Democrats, two Republicans and a Populist, to investigate these and
other rumors. Their report, which was agreed to by all the members,
made public a depressing story. It appeared that one lobbyist had
offered large sums of money for votes against the tariff bill on
account of the income tax provision. Henry O. Havermeyer, president of
the American Sugar Refining Company, testified that the company was in
the habit of contributing to the campaign funds of one political party
or the other in the states, depending on which party was in the
ascendancy; that these contributions were carried on the books as
expense; and that they were given because the party in power "could
give us the protection we should have." Further, one or more officers
of the company were in Washington during the entire time when the
tariff act was pending in the Senate and had conferred with senators
and committees. Senator Quay testified that he had bought and sold
sugar stocks while the Senate was engaged in fixing the schedules and
added: "I do not feel that there is anything in my connection with the
Senate to interfere with my buying or selling the stock when I please;
and I propose to do so." Finally the committee summarized the results
of its investigation, taking the occasion to

    strongly deprecate the importunity and pressure to which Congress
    and its members are subjected by the representatives of great
    industrial combinations, whose enormous wealth tends to suggest
    undue influence, and to create in the public mind a demoralizing
    belief in the existence of corrupt practices.

Yet one more drop remained to fill the cup of Democratic humiliation to
overflowing. The constitutionality of the income tax had been assumed
to have been settled by previous decisions of the Supreme Court,
especially that in the case Springer _v._ United States, which had been
decided in 1880, and in which the Court had upheld the law. The new tax
was brought before the Court in 1894, in Pollock _v._ Farmers' Loan and
Trust Company. The argument against the tax was pressed with great
vigor, not merely on constitutional grounds, but for evident social and
economic reasons. Important financial interests engaged powerful legal
talent and it became clear that the question to be settled was as much
a class and sectional controversy as a constitutional problem. Counsel
urged the Court that the tax scattered to the winds the fundamental
principles of the rights of private property. Justice Field, deciding
against the tax, declared it an "assault upon capital" and a step
toward a war of the poor against the rich. There was fear among some
that the exemption of the smaller incomes might result in placing the
entire burden of taxation on the wealthy. Justice Field, for example,
felt that taxing persons whose income was $4,000 and exempting those
whose income was less than that amount was like taxing Protestants, as
a class, at one rate and Catholics at another. The sectional aspects of
the controversy were brought out in objections that the bulk of the tax
would fall on the Northeast. The most important point involved was the
meaning of the word "direct" as used in the Constitution in the phrase
"direct Taxes shall be apportioned among the several States ... according
to their respective Numbers." If an income tax is a direct tax, it must
be apportioned among the states according to population. Unhappily the
framers of the Constitution were not clear as to what they meant by
the word direct, and specifically they could not have told whether an
income tax was direct or not, because no such tax existed in England
or America at that time. Hence the Supreme Court was placed in the
awkward position of defining a word which the framers themselves could
not define, although the uniform practice hitherto had been to regard
the income tax as indirect and therefore constitutional, even if not
apportioned according to population.

The Pollock case was heard twice. The result of the first trial was
inconclusive and on the central point the Court divided four to four.
After a rehearing, Justice Jackson, who had been ill and not present at
the first trial, gave his vote in favor of constitutionality, but in
the meantime another justice had changed his opinion and voted against
it. By the narrow margin of five to four, then, and under such
circumstances, the income tax provision of the Wilson-Gorman act was
declared null and void. Probably no decision since the Dred Scott case,
with the single exception of the Legal Tender cases, has put the
Supreme Court in so unfortunate a light. Certainly in none has it
seemed more swayed by class prejudice, and so insecure and vacillating
in its opinion.

Before the question regarding the constitutionality of the income tax
was settled, the Democrats reaped the political results of the
Wilson-Gorman tariff act. The law went into force on August 27, 1894;
the congressional elections came in November. The Democrats were almost
utterly swept out of the House, except for those from the southern
states, their number being reduced from 235 to 105. Reed was replaced
in the speaker's chair; tariff reform had turned out to be
indistinguishable from protection; and the Democracy, after its only
opportunity since 1861 to try its hand at government, was demoralized,
discredited, and in opposition again.


BIBLIOGRAPHICAL NOTE

The election of 1892 is described in the standard histories of the
period, and especially well in Peck.

The rise and growth of the Populist movement resulted in a considerable
literature of which the following are best: S.J. Buck, _The Agrarian
Crusade_ (1920), is founded on wide knowledge of the subject and
contains bibliography; F.J. Turner in _The Atlantic Monthly_ (Sept.,
1896), gives a brief but keen account; other articles in periodicals
are F.E. Haynes, in _Quarterly Journal of Economics_, X, 269, W.F.
Mappin, in _Political Science Quarterly_, IV, 433, and F.B. Tracy, in
_Forum_, XVI, 240; F.E. Haynes, _Third Party Movements_ (1916), is
detailed; M.S. Wildman, _Money Inflation in the United States_ (1905),
presents the psychological and economic basis of inflation; J.A.
Woodburn, _Political Parties and Party Problems_ (1914); F.L. Paxson,
_New Nation_ (1915).

Cleveland's administration is well discussed by D.R. Dewey, _National
Problems_ (1907), and by H.T. Peck, who also presents an unusual
analysis of Cleveland in _The Personal Equation_ (1898). The income tax
is best handled by E.R.A. Seligman, _The Income Tax_ (1914).
Cleveland's own account of the chief difficulties of the administration
are in his _Presidential Problems_.

       *       *       *       *       *

[1] Blaine died on Jan. 27, 1893.

[2] Below, p. 320, for an account of the strike as an industrial
dispute.

[3] Below, Chaps. XIII, XIV, XV.

[4] Above, Chap. VIII.

[5] The sweeping reform order of Cleveland late in his second term
illustrated the most common and effective method of making advance.
Late in his administration the President adds to the classified
service; his successor withdraws part of the additions, but more than
makes up at the end of his term,--a sort of two steps forward and one
backward process.

[6] Cleveland's second cabinet was composed of the following: W.Q.
Gresham, Ill., Secretary of State; J.G. Carlisle, Ky., Secretary of
the Treasury; D.S. Lamont, N.Y., Secretary of War; R. Olney, Mass.,
Attorney-General; W.S. Bissell, N.Y., Postmaster-General; H.A. Herbert,
Ala., Secretary of the Navy; Hoke Smith, Ga., Secretary of the
Interior; J.S. Morton, Neb., Secretary of Agriculture.

[7] Below, pp. 336-340.




CHAPTER XIII


THE TREND OF DIPLOMACY

After the international issues arising from the Civil War were settled,
and before foreign relations began to become more important late in the
nineties, our diplomatic history showed the same lack of definiteness
and continuity that stamped the history of politics during the same
years. Eleven different men held the post of Secretary of State during
the thirty-four years from 1865 to 1898, one of them, Blaine, serving
at two separate times. The political situation in Washington changed
frequently, few men of outstanding capacity as diplomatists were in the
cabinets, and most of the problems which arose were not such as would
excite the interest of great international minds. That any degree of
unity in our foreign relations was attained is due in part to the
continuous service of such men as A.A. Adee, who was connected with the
state department from 1878, and Professor John Bassett Moore, long in
the department and frequently available as a counselor.[1]

Even before the Civil War, Americans had been interested in the affairs
of the nations whose shores were touched by the Pacific Ocean.
Missionaries and traders had long visited China and Japan. During the
years when the transcontinental railroads were built, as has been seen,
the construction companies looked to China for a labor supply, and
there followed a stream of Chinese immigrants who were the cause of
a difficult international problem. Our relations with Japan were
extremely friendly. Until the middle of the nineteenth century the
Japanese had been almost completely cut off from the remainder of the
world, desiring neither to give to the rest of humanity nor to take
from them. In 1854 Commodore Matthew C. Perry of the United States
Navy had succeeded in obtaining permission for American ships to take
coal and provisions at two Japanese ports. Townsend Harris shortly
afterwards had been appointed consul-general to Japan and his knowledge
of the East and his tactful diplomacy had procured increased trade
rights and other privileges. In 1863 a Japanese prince had sought to
close the strait of Shimonoseki which connects the inland sea of Japan
with the outside ocean. American, French and Dutch vessels had been
fired upon, and eventually an international expedition had been sent to
open the strait by force. Seventeen ships of war had quickly brought
the prince to terms. An indemnity had been demanded, of which the
United States had received a share. The fund remained in the treasury
untouched until 1883 when it was returned to Japan. The latter received
the refund as "a strong manifestation of that spirit of justice and
equity which has always animated the United States in its relations
with Japan."

The purchase of Alaska in 1867, stretched a long, curved finger out
towards the Asiatic coast, but there was little interest in the new
acquisition and no knowledge of its size or resources.[2]

The first tangible and permanent indication that the United States
might extend its interests into the sphere of the Pacific Ocean
appeared as early as 1872, when an arrangement with a Samoan chief gave
us the right to use the harbor of Pagopago on the island of Tutuila.
Tutuila is far from American shores, being below the equator on the
under side of the world, but the harbor of Pagopago is an unusually
good one and its relation to the extension of American commerce in the
South Pacific was readily seen. Not long afterward, similar trading
privileges were granted to Germany and Great Britain. Conditions in the
islands had by no means been peaceful even before the advent of the
foreigners with their intrigues and jealousies, and in 1885 the
Germans, taking advantage of a native rebellion, hauled down the Samoan
flag on the government building in Apia and seemed about to take
control. In the following year, at the request of the Samoan king, the
American consul Greenebaum proclaimed a protectorate and hoisted the
United States flag. The act was unauthorized and was disavowed at once
by the government at Washington. In the hope of establishing order in
the islands, Bayard, Secretary of State in President Cleveland's first
administration, suggested a triple conference of Germany, Great Britain
and the United States in Washington. During a recess in the conference
a native rebellion overturned the Samoan government and Germany assumed
virtual control. While civil war raged among native factions, the
Germans landed armed forces for the protection of their interests. The
American and British governments, fearful of danger to their rights,
already had war vessels in the harbor of Apia and armed conflict seemed
almost inevitable when a sudden hurricane on March 16, 1889, destroyed
all the vessels except one. The _Calliope_, (English), steamed out to
sea in the teeth of the great storm and escaped in safety. In the face
of such a catastrophe all smaller ills were forgotten and peace reigned
for the moment in Samoa.

Meanwhile, just as Cleveland was retiring from office for the first
time, another conference of the three powers was arranged which
provided a somewhat complicated triple protectorate. After a few years
of quiet, another native insurrection called attention to the islands.
Cleveland was again in the presidential chair, and in a message to
Congress he expressed his belief that the United States had made a
mistake in departing from its century-old policy of avoiding entangling
alliances with foreign powers. A year later he returned to the subject
more earnestly than ever. A report from the Secretary of State
presented the history of our Samoan relations and ventured a judgment
that the only fruits which had fallen to the United States were
expense, responsibility and entanglement. The President thereupon
invited an expression of opinion from Congress on the advisability of
withdrawing from our engagements with the other powers. For the time
nothing came of Cleveland's recommendation, but the continuance of
native quarrels later necessitated another commission to the islands.
The American member reported that the harbor of Apia was full of war
vessels and the region about covered with armed men, but that "not the
sail or smoke of a single vessel of commerce was to be seen there or
about the coasts of these beautiful islands." In 1899, the triple
protectorate was abandoned, as it had complicated the task of governing
the islands. The United States received Tutuila with the harbor of
Pagopago, Germany took the remainder of the group, and England retired
altogether. The trend of Samoan relations was significant: our
connection with the islands began with the desire to possess a coaling
station; the possession first resulted in entanglements with other
nations, and later in the question whether we ought not to withdraw;
and eventually we withdrew from some of the responsibilities, but not
from all. Despite its traditional policy of not contracting entangling
alliances, the United States was in the Pacific to stay.

When Cleveland came into power the first time, he found a long-standing
disagreement with Canada over the fisheries of the northeastern coast.
An arrangement which had resulted from the Treaty of Washington in 1871
came to an end in 1885, and the rights of American fishermen in
Canadian waters then rested upon a treaty of 1818. This treaty was
inadequate owing to various changes which had taken place during the
nearly seventy years that had elapsed since it was drawn up. Several
difficulties lay in the way of the arrangement of a new treaty, an
important one being the readiness of the Republican Senate to embarrass
the President and thus discredit his administration. Matters came to a
critical point in 1886 when Canadian officials seized two American
vessels engaged in deep-sea fishing. Cleveland then arranged a treaty
which provided for reciprocal favors, and when the Senate withheld its
assent the administration made a temporary agreement, (_modus
vivendi_), under which American ships were allowed to purchase bait and
supplies and to use Canadian bays and harbors by paying a license
fee.[3]

The peculiar geographical configuration of Alaska was, meanwhile,
bringing the United States into another diplomatic controversy. An arm
or peninsula of the possession extends far out into the Pacific and is
continued by the Aleutian Islands, which resemble a series of
stepping-stones reaching toward Siberia.[4] The Bering Sea is almost
enclosed by Alaska and the Islands. Within the Sea and particularly on
the islands of St. Paul and St. George in the Pribilof group, large
numbers of seals gathered during the spring and summer to rear their
young. In the autumn the herds migrated to the south, passing out
through the narrow straits between the members of the Aleutian group,
and were particularly open to attack at these points. As early as 1870
the United States government leased the privilege of hunting fur seals
on St. Paul and St. George to the Alaska Commercial Company, but the
business was so attractive that vessels came to the Aleutian straits
from many parts of the Pacific, and it looked as if the United States
must choose between the annihilation of the herds and the adoption of
some means for protecting them. The revenue service thereupon began the
seizure in 1886 of British sealing vessels, taking three in that year
and six during the next. The British government protested against the
seizures on the ground that they had taken place more than three miles
from shore--three miles being the limit to the jurisdiction of any
nation, according to international law. The Alaskan Court which upheld
the seizures justified itself by the claim that the whole Bering Sea
was part of the territory of Alaska and thus was comparable to a harbor
or closed sea (_mare clausum_), but Secretary Blaine disavowed this
contention. The United States then requested the governments of several
European countries, together with Japan, to cooperate for the better
protection of the fisheries, but no results were reached.

Continuance of the seizures in 1889 brought renewed protests from Lord
Salisbury, who was in charge of foreign affairs. Blaine retorted that
the destruction of the herds was _contra bonos mores_ and that it was
no more defensible even outside the three mile limit than destructive
fishing on the banks of Newfoundland by the explosion of dynamite would
be. Lord Salisbury replied that fur seals were wild animals, _ferae
naturae_, and not the property of any individual until captured. An
extended diplomatic correspondence ensued, which resulted in a treaty
of arbitration in 1892.[5]

A tribunal of seven arbitrators was established, two appointed by the
Queen of England, two by the President, and one each by the rulers of
France, Italy and Sweden and Norway, the last two being under one
sovereign at that time. Several questions were submitted to the
tribunal. What exclusive rights does the United States have in the
Bering Sea? What right of protection or property does the United States
have in the seals frequenting the islands in the Sea? If the United
States has no exclusive rights over the seals, what steps ought to be
taken to protect them? Great Britain also presented to the arbitrators
the question whether the seizures of seal-hunting ships had been made
under the authority of the government of the United States.

The decisions were uniformly against the American contention. It was
decided that our jurisdiction in the Bering Sea did not extend beyond
the three mile limit and that therefore the United States had no right
of protection or property in the seals. A set of regulations for the
protection of the herds was also drawn up. Another negotiation resulted
in the payment of $473,000 damages by the United States for the illegal
seizures of British sealers.[6]

Relations with the Latin American countries south of the Mexican border
had been unstable since the Mexican War, an unhappy controversy that
left an ineradicable prejudice against us. John Quincy Adams and Henry
Clay had hoped for a friendly union of the nations of North and South
America, led by the United States, but this ideal had turned out to
have no more substance than a vision. Moreover, the increasing trade
activity of Great Britain and later of Germany had made a commercial
bond of connection between South America and Europe which was, perhaps,
stronger than that which the United States had established. Yet some
progress was made. Disputes between European governments and the
governments of Latin American countries were frequently referred to the
United States for arbitration. An old claim of some British subjects,
for example, against Colombia was submitted for settlement in 1872 to
commissioners of whom the United States minister at Bogota was the most
important. The problem was studied with great care and the award was
satisfactory to both sides. In 1876 a territorial dispute between
Argentina and Paraguay was referred to the President of the United
States. In the case of a boundary controversy between Costa Rica and
Nicaragua, President Cleveland appointed an arbitrator; Argentina and
Brazil presented a similar problem which received the attention of
Presidents Harrison and Cleveland.

It fell to James. G. Blaine to revive the idea of a Pan-American
conference which had been first conceived by Adams and Clay. As a
diplomat, Blaine was possessed of outstanding patriotism and
enthusiastic imagination, even if not of vast technical capacity or of
an international mind. As Secretary of State under President Garfield
in 1881 he invited the Latin American countries to share with the
United States in a conference for the discussion of arbitration. The
early death of Garfield and the ensuing change in the state department
resulted in the abandonment of the project for the time being. Blaine,
however, and other interested persons continued to press the plan and
in 1888 Congress authorized the President to invite the governments of
the Latin American countries to send delegates to a conference to be
held in Washington in the following year. By that time President
Harrison was in power. Blaine was again Secretary of State and was
chosen president of the conference. Among the subjects for discussion
were the preservation of peace, the creation of a customs union,
uniform systems of weights, measures and coinage, and the promotion of
frequent inter-communication among the American states. Little was
accomplished, beyond a few recommendations, except the establishment of
the International Bureau of American Republics. This was to have no
governmental power, but was to be supported by the various nations
concerned and was to collect and disseminate information about their
laws, products and customs. The Bureau has become permanent under the
name Pan American Union and is a factor in the preservation of friendly
relations among the American republics. The reciprocity measure which
Blaine pressed upon Congress during the pendency of the McKinley tariff
bill was designed partly to further Pan-American intercourse.

In the case of a disagreement with Chile, Blaine was less successful. A
revolution against the Chilean President, Balmaceda, resulted in the
triumph of the insurgents in 1891. The American minister to Chile was
Patrick Egan, an Irish agitator who sympathized with President
Balmaceda against the revolutionists and who was _persona non grata_ to
the strong English and German colonies there. While Chilean affairs
were in this strained condition, the revolutionists sent a vessel, the
_Itata_, to San Diego in California for military supplies, and American
authorities seized it for violating the neutrality laws. While the
vessel was in the hands of our officers, the Chileans took control of
it and made their escape. The cruiser _Charleston_ was sent in pursuit
and thereupon the revolutionists surrendered the _Itata_. Not long
afterward, however, a United States Court decided that the pursuit had
been without justification under international law and ordered the
release of the _Itata_. The result was that the United States seemed to
have been over-ready to take sides against the revolutionists, and the
latter became increasingly hostile to Americans.

Relations finally broke under the strain of a street quarrel in the
city of Valparaiso in the fall of 1891. A number of sailors from the
United States ship _Baltimore_ were on shore leave and fell in with
some Chilean sailors in a saloon. A quarrel resulted--just how it
originated and just who was the aggressor could not be determined--but
at any rate the Americans were outnumbered and one was killed. The
administration pressed the case with vigor, declining to look upon the
incident as a sailors' brawl and considering it a hostile attack upon
the wearers of an American uniform. For a time the outbreak of war was
considered likely, but eventually Chile yielded, apologized for its
acts and made a financial return for the victims of the riot. Later
students of Chilean relations have not praised Egan as minister or
Blaine's conduct of the negotiations, but it is fair to note that the
Chileans were prejudiced against the American Secretary of State
because of an earlier controversy in which he had sided against them,
and that the affair was complicated by the presence of powerful
European colonies and by the passions which the revolution had aroused.

Blaine was compelled to face another embarrassing situation in dealing
with Italy in 1891-1892. In October, 1890, the chief of police of New
Orleans, D.C. Hennessy, had been murdered and circumstances indicated
that the deed had been committed by members of an Italian secret
society called the Mafia. A number of Italians were arrested, of whom
three were acquitted, five were held for trial and three were to be
tried a second time. One morning a mob of citizens, believing that
there had been a miscarriage of justice, seized the eleven and killed
all of them. The Italian government immediately demanded protection for
Italians in New Orleans, as well as punishment of the persons concerned
in the attack, and later somewhat impatiently demanded federal
assurance that the guilty parties would be brought to trial and an
acknowledgment that an indemnity was due to the relatives of the
victims of the mob. Failing to obtain these guarantees, the Italian
government withdrew its minister. When a grand jury in New Orleans
investigated the affair it excused the participants and none of them
was brought to trial.

The government at Washington was hampered by the fact that judicial
action in such a case lies with the individual state under our form of
government, whereas diplomatic action is of course entirely federal. If
the states are tardy or derelict in action, the national government is
almost helpless. President Harrison urged Congress to make offenses
against the treaty rights of foreigners cognizable in the federal
courts, but this was never done. Diplomatic activity, however, brought
better results, and an expression of regret on the part of the United
States, together with the payment of an indemnity of $24,000 closed the
incident.

Among the many troublesome questions that faced President Cleveland
when he entered upon the Presidency in 1893 for the second time, the
status of the Hawaiian Islands was important. Since the development of
the Pacific Coast of the United States in the forties and fifties,
there had been a growing trade between the islands and this country.
Reciprocity and even annexation had been projected. In 1875 a
reciprocity arrangement was consummated, a part of which was a
stipulation that none of the territory of Hawaii should be leased or
disposed of to any other power. In this way a suggestion was made of
ultimate annexation. Moreover the commercial results of the treaty were
such as to make a friendly connection with the United States a matter
of moment to Hawaii. The value of Hawaiian exports had increased,
government revenues enlarged, and many public improvements had been
made. In 1884 the grant of Pearl Harbor to the United States as a naval
station made still another bond of connection between the islands and
their big neighbor.

The King of Hawaii during this period of prosperity was Kalakaua.
During a visit to the United States, and later during a tour of the
world he was royally received, whereupon he returned to his island
kingdom with expanded theories of the position which a king should
occupy. Unhappily he dwelt more on the pleasures which a king might
enjoy than upon the obligations of a ruler to his people. At his death
in 1891 Princess Liliuokalani became Queen and at once gave evidence of
a disposition to rule autocratically. Because of her attempts to revise
the Hawaiian system of government so as to increase the power of the
crown, the more influential citizens assembled, appointed a committee
of public safety and organized for resistance. On January 17, 1893, the
revolutionary elements gathered, proclaimed the end of the monarchical
regime and established a provisional government under the leadership of
Judge S.B. Dole. The new authorities immediately proposed annexation to
the United States and a treaty was promptly drawn up in accord with
President Harrison's wishes, and presented to the Senate. At this point
the Harrison administration ended and Cleveland became President.

Cleveland immediately withdrew the treaty for examination and sent
James H. Blount to the islands to investigate the relation of American
officials to the recent revolution. The appointment of Blount was made
without the advice and consent of the Senate and was denounced by the
President's enemies, although such special missions have been more or
less common since the beginning of our history.[7] Blount reported
that the United States minister to Hawaii, J.L. Stevens, had for some
time been favorably disposed to a revolution in the islands and had
written almost a year before that event asking how far he and the naval
commander might deviate from established international rules in the
contingency of a rebellion. "The Hawaiian pear is now fully ripe,"
Stevens had written to the State Department, early in 1893, "and this
is the golden hour for the United States to pluck it." Blount also
informed the President that the monarchy had been overturned with the
active aid of Stevens and through the intimidation caused by the
presence of an armed naval force of the United States.

The blunt language which Cleveland employed in his message to Congress
on the subject, left no doubt about his opinion of the transaction.
"The control of both sides of a bargain acquired in such a manner is
called by a familiar and unpleasant name when found in private
transactions." Believing that an injustice had been done and that the
only honorable course was to undo the wrong, he sent A.S. Willis as
successor to Stevens to express the President's regret and to attempt
to make amends. One of the conditions however which President Cleveland
placed upon the restoration of the Queen was a promise of amnesty to
all who had shared in the revolution. The Queen was at first unwilling
to bind herself and when she later agreed, a new obstacle appeared in
the refusal of the provisional government to surrender its authority.
Indeed it began to appear that the President's sense of justice was
forcing him to attempt the impossible. The provisional government had
already been recognized by the United States and by other powers, the
deposition of the Queen was a _fait accompli_ and her restoration
partook of the nature of turning back the clock. Moreover, force would
have to be used to supplant the revolutionary authorities,--a task for
which Americans had no desire. The President, in fact, had exhausted
his powers and now referred the whole affair to Congress. The House
condemned Stevens for assisting in the overturn of the monarchy and
went on record as opposed to either annexation or an American
protectorate. Sentiment was less nearly uniform in the upper chamber.
The Democrats tended to uphold the President, the Republicans to
condemn him. Although a majority of the committee on foreign relations
exonerated Stevens, yet no opposition appeared to a declaration which
passed the Senate on May 31, 1894, maintaining that the United States
ought not to intervene in Hawaiian affairs and that interference by any
other government would be regarded as unfriendly to this country.

In the outcome, these events merely delayed annexation; they could not
prevent it. In Hawaii the more influential and the propertied classes
supported the revolution and desired annexation. In the United States
the desire for expansion was stimulated by the fear that some other
nation might seize the prize. The military and naval situation in 1898
increased the demand for annexation, and in the summer of that year the
acquisition was completed by means of a joint resolution of the two
houses of Congress.[8] While negotiations were in progress Japan
protested that her interests in the Pacific were endangered. Assurances
were given, however, that Japanese treaty rights would not be affected
by the annexation and the protest was withdrawn. The United States was
now "half-way across to Asia."

Most dangerous in its possibilities was the controversy with Great
Britain over the boundary between British Guiana and Venezuela. British
Guiana lies on the northern coast of South America, next to Venezuela
and extends inland, with its western boundary roughly parallel to the
valley of the Orinoco River. A long-standing disagreement had existed
about the exact position of the line between the two countries--a
disagreement which harked back to the claims of the Dutch, who had
acquired Guiana in 1613 and had turned it over to the British in 1814.
In 1840 England commissioned a surveyor named Schomburgk to fix the
boundary but his decision was objected to by the Venezuelans who
claimed that he included a great area that rightfully belonged to them.
Gradually the British claims included more and more of the territory
claimed by Venezuela, and the discovery of gold in the disputed region
not only drew attention to the necessity of a settlement of the
boundary but also attracted prospectors who began to occupy the land.
In 1876 Venezuela began negotiations for some means of deciding the
dispute and came to the conclusion that arbitration was her only
recourse. On the refusal of Great Britain to heed her protests, the
Venezuelan government suspended diplomatic relations in 1887, although
the United States attempted to prevent a rupture by suggesting the
submission of the difference to an arbitral tribunal. This offer was
not accepted by Great Britain, and repeated exertions on the part of
both Venezuela and the United States at later times failed to produce
better results. When Cleveland returned to the presidency in 1893 he
again became interested in the Venezuelan matter and Secretary of State
Gresham urged the attention of the British government to the
desirability of arbitration.

President Cleveland was a man of great courage and had a very keen
sense of justice. In his opinion a great nation was playing the bully
with a small one, and the injustice stirred his feelings to the depths.
With the President's approval Secretary Olney, who had succeeded
Gresham on the death of the latter, drew up an exposition of the Monroe
doctrine which was communicated to Lord Salisbury. This despatch, which
was dated July 20, 1895, brought matters to a climax. In brief the
administration took the position that under the Monroe doctrine the
United States adhered to the principle that no European nation might
deprive an American state of the right and power of self-government.
This had been established American policy for seventy years. The
Venezuelan boundary controversy was within the scope of the doctrine
since Great Britain asserted title to disputed territory, substantially
appropriating it, and refused to have her title investigated. At the
same time Secretary Olney disclaimed any intention of taking sides in
the controversy until the merits of the case were authoritatively
ascertained, although the general argument of the despatch seemed to
place the United States on the side of Venezuela. Moreover, Secretary
Olney adopted a swaggering and aggressive, not to say truculent tone.
He drew a contrast between monarchical Europe and self-governing
America, particularly the United States, which "has furnished to the
world the most conspicuous ... example ... of the excellence of free
institutions, whether from the standpoint of national greatness or of
individual happiness." The United States, he asserted, is "practically
sovereign on this continent" because "wisdom and justice and equity are
the invariable characteristics" of its dealings with others and because
"its infinite resources combined with its isolated position render it
master of the situation ... as against any or all other powers."

Lord Salisbury did not reply to Secretary Olney for more than four
months. He then asserted that President Monroe's message of 1823 had
laid down two propositions: that America was no longer to be looked
upon as a field for European colonization; and that Europe must not
attempt to extend its political system to America, or to control the
political condition of any of the American communities. In Lord
Salisbury's opinion Olney was asserting that the Monroe doctrine
conferred upon the United States the right to demand arbitration
whenever a European power had a frontier difference with a South
American community. He suggested that the Monroe doctrine was not a
part of international law, that the boundary dispute had no relation to
the dangers which President Monroe had feared and that the United
States had no "apparent practical concern" with the controversy between
Great Britain and Venezuela. He also raised some objections to
arbitration as a method of settling disputes and asserted the
willingness of Great Britain to arbitrate her title to part of the
lands claimed. The remainder, he declared, could be thought of as
Venezuelan only by extravagant claims based on the pretensions of
Spanish officials in the last century. This area he expressly refused
to submit to arbitration. The language of the Salisbury note was
diplomatically correct, a fact which did not detract from the effect of
the patronizing tone which characterized it.

President Cleveland doggedly proceeded with his demands. On December
17, (1895), he laid before Congress the correspondence with Lord
Salisbury, together with a statement of his own position on the matter.
Disclaiming any preconceived conviction as to the merits of the
dispute, he nevertheless deprecated the possibility that a European
country, by extending its boundaries, might take possession of the
territory of one of its neighbors. Inasmuch as Great Britain had
refused to submit to arbitration, he believed it incumbent upon the
United States to take measures to determine the true divisional line.
He suggested therefore that Congress empower the executive to appoint a
commission to investigate and report. His closing words were so grave
as to arouse the country to a realization of the dangerous pitch to
which negotiations had mounted:

    When such report is made and accepted it will in my opinion be the
    duty of the United States to resist ... the appropriation by Great
    Britain of any ... territory which after investigation we have
    determined of right belongs to Venezuela. In making these
    recommendations I am fully alive to the responsibility incurred,
    and keenly realize all the consequences that may follow. I am
    nevertheless firm in my conviction that while it is a grievous thing
    to contemplate the two great English-speaking peoples ... as being
    otherwise than friendly ... there is no calamity ... which equals
    that which follows a supine submission to wrong and injustice.

Congress at once acceded to Cleveland's wishes and appropriated
$100,000 for the proposed investigation. For a brief moment neither
Great Britain nor America quite realized the meaning of the President's
warlike utterance. In America it had generally been felt previously
that his foreign policy was conciliatory rather than aggressive and,
besides, the Venezuelan dispute had but little occupied popular
attention. When it became evident that war was a definite possibility,
public interest followed every step with anxiety. Newspaper sentiment
divided. The press generally judged Cleveland's stand strong and
"American." On the other hand, a few periodicals like the _Nation_
insinuated that the President was actuated by the desire to make
political capital for a third term campaign and characterized his
action as "criminally rash and insensate," "ignorant and reckless,"
"impudent and insulting." Influential citizens in both countries made
energetic attempts to prevent anything that might make war inevitable.
The Prince of Wales and Lord Roseberry threw their influence on the
side of conciliation. A.J. Balfour declared that a conflict with the
United States would carry something of the "horror of civil war" and
looked forward to the time when the country would "feel that they and
we have a common duty to perform, a common office to fulfill among the
nations of the world."

The President appointed a commission which set to work to obtain the
information necessary for a judicial settlement of the boundary, and
both Great Britain and Venezuela tactfully expressed a readiness to
cooperate. Their labors, however, were brought to a close by a treaty
between the two disputants providing for arbitration. A prominent
feature of the treaty was an agreement that fifty years' control or
settlement of an area should be sufficient to constitute a title, a
provision which withdrew from consideration much of the territory to
which Venezuela had laid claim. In October, 1899, the arbitration was
concluded. The award did not meet the extreme claims of either party,
but gave Great Britain the larger share of the disputed area, although
assigning the entire mouth of the Orinoco River to Venezuela.

Besides giving new life to the Monroe doctrine as an integral part of
our foreign policy, the incident served to illustrate the dangers of
settling international disputes in haphazard fashion. In January, 1897,
therefore, Secretary Olney and the British Ambassador at Washington,
Sir Julian Pauncefote, negotiated a general treaty for the settlement
of disputes between the two countries by arbitration. Even with the
example of the possible consequences of the Venezuelan controversy
before it, however, the Senate failed to see the necessity for such an
expedient, defeated the treaty by a narrow margin and left the greatest
problem of international relations--the settlement of controversies on
the basis of justice rather than force--to the care of a future
generation.

On the whole, as has already been noted, the history of American
diplomacy from 1877 to 1897 is scarcely more than an account of a
series of unrelated incidents. Not only did the foreign policy of
Blaine differ sharply from that of Cleveland, but there was no great
question upon which public interest came to a focus, except temporarily
over the Venezuelan matter, and no lesser problems that continued long
enough to challenge attention to the fact that they remained unsolved.
There were visible, nevertheless, several important tendencies. Our
attitude toward Samoa and Hawaii indicated that the instinctive desire
to annex territory had not disappeared with the rounding out of the
continental possessions of the United States; American interest in
arbitration as a method of settling disputes was expressed again and
again; the place of the Monroe doctrine in American international
policy was clearly shown; and the determination of the United States to
be heard in all affairs that touched her interests was demonstrated
without any possibility of doubt.


BIBLIOGRAPHICAL NOTE

The most complete and reliable authority is J.B. Moore, _A Digest of
International Law_ (8 vols. 1906), by one who was intimately connected
with many of the incidents of which he wrote; the text of the treaties
is in W.M. Malloy, _Treaties, Conventions, International Acts, etc.,
between the United States of America and other Powers_ (2 vols., 1910).
Valuable single volumes are: J.B. Moore, _American Diplomacy_ (1905);
and C.B. Fish, _American Diplomacy_ (1915). W.F. Johnson, _America's
Foreign Relations_ (2 vols., 1916), is interesting but somewhat marred
by the author's tendency to take sides on controversial points; see
also J.B. Henderson, _American Diplomatic Questions_ (1901). J.S.
Bassett, _Short History of the United States_ (1913), contains a brief
and compact chapter.

Essential material on particular incidents is found in the following.
On Japan, "Our War with One Gun" in _New England Magazine_, XXVIII,
662; J.M. Callahan, _American Relations in the Pacific and the Far
East_ (1901); W.E. Griffis, _Townsend Harris_ (1896). On Samoa, J.W.
Foster, _American Diplomacy in the Orient_ (1903); R.L. Stevenson,
_Eight Years of Trouble in Samoa_ (1892). On the seal fisheries, J.W.
Foster, _Diplomatic Memoirs_ (2 vols., 1909). On Hawaii, Cleveland's
message in J.D. Richardson, _Messages and Papers of the Presidents_,
IX, 460. On Venezuela, Grover Cleveland, _Presidential Problems_,
Chap. IV.

       *       *       *       *       *

[1] The development of the United States as a commercial power was
seen in the increased use of consuls as agents for procuring and
publishing industrial and commercial information.

[2] Cf. Fish, _American Diplomacy_, 398.

[3] For later aspects of the controversy, see below, pp. 532-533.

[4] Cf. map p. 10.

[5] J.W. Foster, who was intimately connected with the case, suggests
that the defects in the American argument were due partly to following
briefs prepared by an agent of the Alaska Commercial Company in
Washington. The agent was interested in getting everything possible for
his company but his knowledge of the law in the case was slight. Cf.
Foster, _Memoirs_, II, 26 f.; Moore, _American Diplomacy_, 97-104.

[6] The attempts to protect the herds by government regulation failed
to have any important results. An international arrangement was made in
1911, but the slaughter had proceeded so far that grave question arose
whether any agreement would be effective short of absolute prohibition.
In 1912 Congress passed a law forbidding any killing on the land for a
term of five years; in 1917 when the restrictions were released the
herds had greatly increased. In 1918 the seals numbered 530,480.
_American Year Book_, 1918, 503-4.

[7] Cf. _Political Science Review_, Aug., 1916, 481-499.

[8] Cf. below, p. 387 ff. Hawaii was brought into the Union as a
territory in 1900.




CHAPTER XIV


THE RISE OF THE WAGE EARNER

In their handling of the labor problem, the governments of the states
and the nation showed greater ignorance and less foresight than
characterized their treatment of any of the other issues of the
quarter century following the Civil War. Yet the building of the
railroads and their consolidation into great systems, the development
of manufacturing and its concentration into large concerns, and the
growth of an army of wage earners brought about a problem of such size
and complexity as to demand all the information and vision that the
country could muster.

The phenomenal accumulation of wealth in the fields of mining,
transportation and manufacturing which characterized the new
industrial America formed the basis of a powerful propertied class.
Some of the wealth was amassed by such unscrupulous methods as those
which caused the popular demand for government regulation of the
railroads and trusts. The prizes of success were big. The men who made
their way to the top--men like Gould, Fisk, Vanderbilt, Rockefeller
and Carnegie--were pioneers whose courage, foresight, and daring were
combined with sufficient ruthlessness to enable them to triumph where
others failed. A few of them, like Carnegie, had some slight
conception of the meaning of the labor problem; most of them did not.
Linked to the industrial pioneer by community of interest was the
holder of the war bonds of the federal government. These securities
were purchased with depreciated paper currency but increased very
greatly in value after the successful outcome of the struggle, and
formed an investment whose value it is extremely difficult to
estimate. The owners of the stocks and bonds of the railroads and
manufacturing combinations further swelled the ranks of the propertied
class. Stability, continuous business and large earnings were the
immediate considerations to this group. Anything which interfered was,
naturally, a thing to be fought. Never before, unless in the South in
slavery days, had a more powerful social class existed in the United
States. A large fraction of the group was composed of men who had
risen from poverty to wealth in a short time. From one point of view
such a man is a "self-made" man, industrious, frugal, able, energetic,
bold. From another point of view he is a _parvenu_, narrow,
overbearing, ostentatious, proud, conceited, uncultivated. The
relatively small size of the propertied class and an obvious community
of interest tended to make its members reach a class consciousness
even during the Civil War. The success of the group in preventing all
tariff reduction after 1865 was a striking example of the solidarity
of its membership and its readiness for action.

Class consciousness among the wage earners developed much more slowly,
and in the nature of things was much less definite. Nevertheless the
history of the industrial turmoil of the quarter century after the
Civil War is the history of a class groping for political, social and
economic recognition.

At the close of the war the labor situation was confused and
complicated. A million and a half of men in the North and South had to
be readmitted to the ranks of industry. Approximately another million
had died or been more or less disabled during the conflict. A stream
of immigrants, already large and constantly increasing, was pouring
into the North and seeking a means of livelihood. As has been seen,
most of these settled in the manufacturing and mining sections of the
northern and eastern states, helped to crowd the cities, and
overflowed into the fertile, free lands of the mid-West. Nearly
800,000 of them reached the United States in one year, 1882. Most of
them were men--an overwhelming portion of them men of working age,
unskilled, frequently illiterate and hence compelled to seek
employment in a relatively small number of occupations. Both the
chances of unemployment and the danger of a lowered standard of living
were increased by the immigrants.

The greater use of machinery during the progress of the war has
already been alluded to, but some of its results demand further
mention.[1] Most evident was the huge increase in the volume and
value of the products of the factories. The labor of a single worker
increased in effectiveness many times; in other words, the labor cost
of a unit of production greatly diminished with the improvement of
mechanical devices. The labor cost of making nails by hand in 1813 was
seventy fold the cost of making them by machinery in 1899; loading ore
by hand was seventy-three times as expensive in 1891 as machine
loading was in 1896. Increased production encouraged greater
consumption, enhanced competition for markets, and opened the world to
the products of American labor. Moreover, the introduction of
machinery emphasized the importance of capital. When iron was rolled
by hand, when cloth was produced by the use of the spinning wheel and
hand-loom, when fields were tilled by inexpensive plow and hoe,
relatively small amounts of capital were needed by the man who started
in to work. Mechanical inventions revolutionized the situation. A
costly power-loom enabled its owner to eliminate handworking
competitors. If a workman could raise sufficient money or credit to
purchase a supply of machines he could "set up in business," employ a
number of "hands" and merely direct or manage the enterprise. Under
such a system the employer must make enough profit to pay interest on
his investment and to repair and replace his equipment. His attention
was fixed on these elements of his industrial problem and the
well-being of the laborer sank to a lower plane of importance. If the
employer found the labor supply plentiful he had the upper hand in
setting the wage-scale; the unorganized employee was almost completely
at his mercy, because the employer could find another workman more
easily than the workman could find another job. Meanwhile the workman
knew the increased product which he was turning out, and became
discontented because he did not see a corresponding increase in his
remuneration.

From about 1830, when the rapid development of the use of mechanical
appliances began, to the late eighties and early nineties when the new
regime was meeting its sternest conflicts in the trust problem and the
militant labor unions, the army of the wage earner was growing faster
than the population. Between 1870 and 1890, for example, the
population increased 63 per cent., while the number of laborers
engaged in manufacturing increased nearly 130 per cent. By the latter
year, 6,099,058 persons, about a tenth of the total population, were
employed in transportation, mining and manufacturing.

It was noticeable, also, that the wage earners tended to concentrate.
The laborers engaged in manufacturing were to be found, for the most
part, in the Northeast, and especially in such leading industrial
cities as New York, Chicago and Philadelphia. Furthermore, the
development of the factory system and the consolidation of many small
companies into a few great ones tended to localize the labor problem
still further--in a relatively small number of plants. The
concentration of industry in great factories where large numbers of
workers labored side by side ended the paternal care which the
old-time employer had expended upon his employees. With the
introduction of machinery, the danger of accidents due to the
ignorance or carelessness of fellow workmen increased. The use of
mechanical appliances also gave opportunity for the employment of
women and children, and thus raised the question whether any
restrictions ought to be placed upon the employment of these classes
of people. The construction of factories, their ventilation, sanitary
appliances, and safe-guards for health and comfort became subjects of
importance.

With the example of consolidation before them that was presented by
the railroads and the corporations, it was inevitable that the wage
earners should organize for their protection and advancement. Labor
organizations of wage earners have existed in the United States since
1827, and between that time and 1840 came a considerable awakening
among the laboring classes which was part of a general humanitarian
movement throughout the country. Robert Owen, an English industrial
idealist, had visited this country about 1825 and provided the
initiative for a short-lived communistic settlement at New Harmony,
Indiana. Similar enterprises were established at other points; the
most famous of these was that at Brook Farm in Massachusetts, which
enlisted the interest and support of many of the literary people of
New England. The expanding humanitarian and idealistic movement was
cut short by the Civil War, but the development of industrialism went
on uninfluenced by the spirit of social progress which might have
permeated it. After reconstruction was over, a new generation had to
become impressed with the evils which needed correction and to set
itself to the task which civil strife had thrust aside.

The need of a responsible organization of wage earners was indicated
by the career of the Molly Maguires. The Molly Maguires constituted an
inner circle of Irish Catholics who controlled the activities of the
branches of the Ancient Order of Hibernians in the hard-coal counties
of eastern Pennsylvania. During the war and immediately after it the
group gained a little power in local politics, and also undertook to
punish mine owners, bosses and superintendents who offended members of
the Order. Intimidation became common, and even murder was resorted to
until the region was fairly terrorized. It seemed impossible to combat
the Mollies because their activities were shrouded in secrecy.
Usually, for example, when a murder was to be committed, a member
would be brought in from an outside district in order that he might
not be recognized if discovered, and he would be aided in escaping
after the crime. Finally the president of the Philadelphia and Reading
Railroad procured a Pinkerton detective named James McParlan who went
into the region and remained for two years. During this time he posed
as a fugitive from justice and as a counterfeiter, became a member of
the Order, a confidant of the Molly Maguires, and collected evidence.
Armed with the knowledge acquired by McParlan, the officials were able
to arrest and convict twenty-four criminals, of whom ten were
executed, and the career of the Mollies came to an end.

The activities of the Molly Maguires were symptomatic of what might
occur throughout the ranks of labor during the confused period of
adjustment after the war, and yet they were temporary and local in
their effect on the development of the labor movement. The history of
the great labor controversies after the war properly begins with the
Knights of Labor, an association which originated in Philadelphia in
1869 as the result of the efforts of a garment cutter named Uriah S.
Stephens.[2] In the beginning, the affairs of the Knights were veiled
in dense secrecy; even the name of the society was never mentioned but
was indicated by five stars--*****. As the number of members increased,
however, all manner of disquieting and untruthful rumors spread
concerning its purposes, so that the element of secrecy was done away
with in 1881 and a declaration of principles was made public. The
fundamental purpose of the Knights was the formation of an order which
should include all branches of the wage earners and which should aim
to improve their economic, moral, social and intellectual condition.
Emphasis was placed, that is to say, on the welfare of the laboring
classes as a whole, rather than upon that of any particular trade or
craft. The organization was centralized and the interests of the group
were developed on a national scale. The growth of the association was
extremely rapid at times, reaching a climax in the middle eighties
when about 700,000 members, both men and women, made it a power in
industrial disputes. Some of the members taken in at this time were
extremists--European anarchists, for example--who urged a violent
policy and got almost if not quite out of control of the officers
during 1886. In the late eighties the membership dwindled rapidly,
owing to the failure of strikes instituted by the order, and its place
and influence were largely taken by the American Federation of Labor.

The latter body was the outgrowth of a convention held in Pittsburg in
1881, but it did not adopt its final name until 1886. Its purpose was
to group labor organizations of all kinds, leaving the government of
each affiliated body with the body itself. Each of the members of the
Federation is composed of workers in a given trade or industry, like
the International Typographical Union, the United Mine Workers, and
many others. The annual convention is composed of delegates from the
constituent societies. The growth of the organization was rapid and
continuous. Coincidently with the expansion of the Knights of Labor
and the growth of the American Federation came the great development
of the labor press. Professor Ely estimated late in the eighties that
possibly five hundred newspapers were devoted to the needs of the
labor movement. The numerous farmers' organizations, typified by the
Patrons of Husbandry, are other examples of the growing tendency
toward cohesion among the less powerful classes. Indeed, the Grange
originated only a year earlier than the Knights of Labor, and like it
was a secret order.

The wage earners, then, were rapidly becoming class-conscious. They
had found conditions which seemed to them intolerable, had formed
organizations on a national scale and had drawn up a definite program
of principles and reforms. The exact grievances which inspired the
Knights, the Federation and other less important organizations are
therefore of immediate importance.

In order to secure for the wage earner a sufficient money return for
his work, and sufficient leisure for the education of his intellectual
and religious faculties, and to enable him to understand and perform
his duties as a citizen, the Knights demanded the establishment of
bureaus of labor for the collection of information; the reservation of
the public lands for actual settlers; the abrogation of laws that did
not bear equally on capital and labor; the adoption of measures for
the health and safety of the working classes; indemnity for injuries
due to the lack of proper safeguards; the recognition of the
incorporation of labor unions; laws compelling corporations to pay
laborers weekly; arbitration in labor disputes; and the prohibition of
child labor. The Knights of Labor also favored state ownership of
telegraphs and railroads, as well as an eight hour working day. The
purposes of the American Federation scarcely differed from this
program, although its methods and its form of organization were quite
distinct.

At the present time, when most of these demands have been met in one
degree or another, it is difficult to see why there should have been
delay and contention in agreeing to a program which, so far as it
deals with labor problems pure and simple, appears both modest and
reasonable. But the state of mind of a large fraction of the nation
was not in accord with ambitions which doubtless seemed excessively
radical. Fundamentally a great portion of the propertied classes held
a low estimate of the value and rights of the laboring people, as well
as of the possibilities of their development, and feared that evil
results would follow from attempts to improve their condition. The
employment of children in factories, it was thought, would inculcate
in them the needed habits of industry, and the reduction of the
working hours would merely provide time which would be spent in the
acquirement of vicious practices. If, in addition, the employers
opposed such changes as the abolition of child labor and the reduction
of the working day to eight hours on the ground of the financial
sacrifice which seemed to be involved, their attitude was in keeping
with the ruthless exploitation of the human resources of the country
which was common during this period. It should be remembered, too,
that the lofty conception which most Americans held of the
opportunities and customs of their country stood in the way of a frank
study of conditions and an equally frank admission of abuses. For
decades we had reiterated that America was the land of opportunity,
that economic, political and social equality were the foundations of
American life and that the American workingman was the best fed and
the best clothed workingman in the world. In the face of this view of
industrial affairs it was difficult to be alert to manifold abuses and
needed reforms. To one holding this view of affairs--and it was a
common view--the laborer who demanded better conditions was
unreasonable and unappreciative of how "well off" he was. Hence the
blame for the labor unrest was frequently laid on the foreigner, who
was supposed to bring to America the opposition to government which
had been fostered in him by less democratic institutions abroad.
Undoubtedly immigration greatly complicated industrial conditions, as
has been indicated, yet essentially the labor question arose from the
upward progress of a class in American society and was as inevitable,
foreigner or no foreigner, as the coming of a new century.

Two illustrations will throw light upon some of the demands which the
wage earners frequently presented. Writing in August, 1886, Andrew
Carnegie, the prominent steel manufacturer, discussed the proper
length of the working day. Every ton of pig-iron made in the world,
with the exception of that made in two establishments, he asserted,
was made by men working twelve hours a day, with neither holiday nor
Sunday the year round. Every two weeks it was the practice to change
the day workers to the night shift and at that time the men labored
twenty-four hours consecutively. Moreover, twelve to fifteen hours
constituted a day's work in many other industries. Working hours for
women and children had almost equally slight reference to their
physical well-being.

The "truck-system" was a less widespread abuse, but one that caused
serious trouble at certain points. Under this plan, a corporation
keeps a store at which employees are expected to trade, or are
sometimes forced to do so. Obviously such a store might be operated to
the great benefit of the workman and without loss to the employer, but
the temptation to make an unfair profit and to keep the laborer always
in debt to the company was very great. A congressional committee which
investigated conditions in Pennsylvania in 1888 found that prices
charged in company stores ran from ten per cent. to 160 per cent.
higher than prices in other stores in the vicinity, and that a workman
was more likely to keep his position if he traded with the company.

The most insistent cause of industrial conflict was the question of
wages. Forty-one per cent. of all the strikes between 1881 and 1900
were for more pay; twenty-six per cent., for shorter hours. Between
the close of the war and the early nineties, industrial prosperity was
widespread except for the period of prostration following 1873 and the
less important depression of 1884. Not unnaturally the laborer desired
to have a larger share of the product of his work. The individual,
however, was impotent before a great corporation, when the wage-scale
was being determined; hence workmen found it advantageous to combine
and bargain collectively with their employer, in the expectation that
he would hesitate to risk the loss of all his laboring force, whereas
the loss of one or a few would be a matter of indifference.

In the meanwhile, a little ameliorative labor legislation was being
passed by state legislatures and by Congress. A Massachusetts law of
1866 forbade the employment of children under ten years of age in
manufacturing establishments, prohibited the employment of children
between the ages of ten and fourteen for more than eight hours per
day, and provided that children who worked in factories must attend
school at least six months in the year. In 1868 a federal act
constituted eight hours a day's work for government laborers, workmen
and mechanics, but some doubt arose as to the intent of part of it and
the law was not enforced. In many states eight-hour bills were
introduced, but were defeated in all except six, of which Connecticut,
Illinois and California were examples, and even in these cases the
laws were not properly drawn up or were not enforced. In 1869 a Bureau
of Statistics of Labor was established in Massachusetts which led the
way for similar enterprises in other states. It collected information
concerning labor matters and reported annually to the legislature. In
1874 a Massachusetts ten-hour law forbade the employment of women and
minors under eighteen for more than sixty hours a week, although
refraining from the regulation of working hours for men. In 1879, in
imitation of English factory acts, Massachusetts passed a general law
relating to the inspection of manufacturing establishments. It
provided that dangerous machinery must be guarded, proper ventilation
secured, elevator wells equipped with protective devices and
fire-escapes constructed. Other states followed slowly, but
legislation was frequently negatived by lack of effective
administration. In brief, then, agitation previous to 1877 had
resulted in the passage of a few protective acts, but even these were
restricted to a few states and were not well enforced. It was,
therefore, more than a mere coincidence that the first general strike
movement spread over the country in this same year, 1877.

It will be remembered that the great railroad strikes of that year
extended over many of the northern roads but caused most trouble in
Martinsburg, West Virginia, Pittsburg and other railway centers. Much
property was destroyed, lives were lost, and the strikers failed to
obtain their ends.[3] Other effects of the controversy, moreover,
made it an important landmark in the history of the labor question.
The inconvenience and suffering which the strike caused in cities far
distant from the scene of actual conflict indicated that the
transportation system was already so essential a factor in welding the
country together that any interruption to its operation had become
intolerable. The hostility of some of the railway managers to union
among their laborers and the rumors that they were determined to crush
such organizations augured ill for the future. The hordes of
unemployed workmen and the swarms of tramps which had resulted from
the continued industrial depression of 1873 insured rioting and
violence during the strike, whether the strikers themselves favored it
and shared in it or not. The destruction of property which resulted
from the strike caused many state legislatures to pass conspiracy laws
directed against labor; more attention was paid to the need of trained
soldiers for putting down strikes, and the construction of many
armories followed; and the courts took a more hostile attitude toward
labor unions. Equally important was the effect on the workmen
themselves. When the strike became violent and the state militia
failed to check it, the strikers found themselves face to face with
federal troops. President Hayes could not, of course, refuse to
repress the rioters; nevertheless his action aligned the power of the
central government against the strikers, and seemed to the latter to
align the government against the laborers as a class. Of a sudden,
then, the labor problem took on a new and vital interest; workingmen's
parties "began to spring up like mushrooms"; and the laboring men saw
more clearly than ever the essential unity of their interests.

Industrial unrest increased rather than diminished during the
prosperous eighties; for the first five years of the decade, strikes
and lockouts together averaged somewhat over five hundred annually.
The climax came in "the great upheaval" of 1884 to 1886.[4] In the
latter year nearly 1600 controversies involved 610,024 men and a
financial sacrifice estimated at $34,000,000. Early in May, 1886,
occurred the memorable Haymarket affair in the city of Chicago. The
city was a center of labor agitation, some of it peaceful, some of it
in the hands of radical European anarchists whose methods were shown
in a statement of one of their newspapers, _The Alarm_, on February
21, 1885:

    Dynamite! Of all the good stuff, this is the stuff. Stuff several
    pounds of this sublime stuff into an inch pipe ... plug up both
    ends, insert a cap with a fuse attached, place this in the
    immediate neighborhood of a lot of rich loafers ... and light
    the fuse. A most cheerful and gratifying result will follow.

On May 1 strikes began for the purpose of obtaining an eight hour day.
During the course of the strike some workmen gathered near the
McCormick Reaper Works; the police approached, were stoned, and
retorted by firing upon the strikers, killing four and wounding many
others. Thereupon the men called a meeting in Haymarket Square to
protest against the action of the police; in the main they were
orderly, for Mayor Carter Harrison was present and found nothing
objectionable. Later in the evening, when the Mayor and most of the
audience had left, remarks of a violent nature seem to have been made,
and at this point a force of 180 police marched forward and ordered the
meeting to disperse. Just then a bomb was thrown into the midst of the
police, killing seven and wounding many others. The entire nation was
shocked and terrified by the event, as hitherto anarchy had seemed to
be a far-away thing, the product of autocratic European governments.
The thrower of the bomb could not be discovered, but numerous
anarchists were found who themselves possessed such weapons or had
urged violence in their speeches or writings. Eight of them, nearly all
Germans, were tried for murder on the ground that the person who threw
the bomb must have read the speeches or writings of the accused
anarchists and have been thereby encouraged to do the act. The
presiding judge, Joseph E. Gary, was of the opinion that the
disposition in the guilty man to throw the bomb was the result of the
teaching and advice of the prisoners. The counsel for the accused
declared that since the guilty person could not be found it was
impossible to know whether he had ever heard or read anything said or
written by the prisoners, or been influenced by their opinions.
Eventually seven anarchists were convicted, of whom four were hanged,
one committed suicide, and three were imprisoned. In 1893 the Governor
of Illinois, John P. Altgeld, pardoned the three prisoners, basing his
action mainly on the ground that no proof had been brought forward to
show that they were in any way acquainted with the unknown
bomb-thrower. The result of the conviction was the break-up of the
radical anarchistic movement and also the temporary discrediting of the
general agitation for an eight hour day, although neither the Knights
of Labor nor the Federation of Labor had any connection with the
anarchists, and both deprecated violence.

In the meanwhile, Congress had concerned itself slightly with the labor
problem. In 1884 a Bureau of Labor had been established to collect
information on the relation of labor and capital. Two years later, just
before the Haymarket affair, President Cleveland had sent a message to
Congress in which he adverted to the many disputes which had recently
arisen between laborers and employers, and urged legislation to meet
the exigency. Considerations of justice and safety, he thought,
demanded that the workingmen as a class be looked upon as especially
entitled to legislative care. Although Cleveland deprecated violence
and condemned unjustifiable disturbance, he believed that the
discontent among the employed was due largely to avarice on the part of
the employing classes and to the feeling among workmen that the
attention of the government was directed in an unfair degree to the
interests of capital. On the other hand, he suggested that federal
action was greatly limited by constitutional restrictions. He
accordingly urged that the Bureau of Labor be enlarged and that
permanent officers be appointed to act as a board of arbitration in
industrial disputes. The legislative branch was not inclined to follow
Cleveland's lead, although he returned to the subject after the
Haymarket affair, for it was commonly felt that his suggestion was too
great a step in the direction of centralization of government. Two
years later, in 1888, a modest act was passed which provided for the
investigation of differences between railroads and their employees, but
only when agreed to by both parties, and no provision was made for the
enforcement of the decision of the investigators. The practical results
were not important. Similar action had already been taken in a few
states. By 1895 fifteen states had laws providing for voluntary
arbitration, but the results were slight in most cases.

Very little progress was being made in the states in the passage of
other industrial legislation. In Alabama and Massachusetts in the
middle eighties acts extended and regulated the liability of employers
for personal injuries suffered by laborers while at work.[5] At the
same time the attitude of the legislatures and the courts in some
states toward strikes underwent a slight modification. In many states
where the legislatures had not passed definite statutes to the
contrary, it had been held by the courts that strikers could be tried
and convicted for conspiracy. In a few cases, states passed acts
attempting to define more exactly the legal position of strikers. A New
York court in 1887, for example, held that the law of the state
permitted workmen to seek an increase of wages by all possible means
that fell short of threats or violence. Before the close of Cleveland's
second administration, considerable progress had been made in state
legislation concerning conditions and hours of labor for women and
children, protection of workers from dangerous machinery, the payment
of wages, employer's liability for accidents to workmen, and other
subjects. On the other hand, in some cases unreasonable or
ill-considered actions on the part of the unions or their active
agents--the "walking delegates"--turned popular sentiment against them.
Particularly was this true in cases of violence and of strikes or
boycotts by unions in support of workmen in other trades at far distant
points.

During the presidential campaign of 1892 a violent strike at the
Carnegie Steel Company's works in Homestead, Pennsylvania, arose from a
reduction in wages and a refusal of the Company to recognize the Iron
and Steel Workers' Union. An important feature of this disturbance was
the use of armed Pinkerton detectives by the Company for the protection
of its buildings. Armed with rifles they fell into conflict with the
workmen, a miniature military campaign was carried on, lives were lost
and large amounts of property destroyed. Eventually the entire militia
of the state had to be called out to maintain peace.

It remained, however, for Chicago and the year 1894 to present one of
the most far-reaching, costly and complex labor upheavals that has ever
disturbed industrial relations in America. So ill understood at the
time were the real facts of the controversy that it is doubtful whether
it is possible even now to distinguish between truth and rumor in
regard to some of its aspects.

The town of Pullman, near Chicago, was the home of the Pullman Palace
Car Company, a prosperous corporation with a capital of $36,000,000. It
provided houses for its employees, kept up open stretches of lawn,
flower beds and lakes. In 1893 and 1894, when general business
conditions were bad, the Company reduced the wages of its workmen about
twenty-five per cent. A committee of the men asked for a return to
former rates, but they were refused, three members of the committee
were laid off, and the employees then struck. Late in June, 1894, the
American Railway Union, to which many of the workmen belonged, took up
the side of the men, and the General Managers' Association, comprising
officials of twenty-four roads entering Chicago, took the side of the
Company. Through the entry of the Union and the Association, the
relatively unimportant Pullman affair expanded to large proportions.
Violence followed; cars were tipped over and burned; property was
stolen and tracks ruined; and eventually the United States government
was drawn into the controversy.

Numerous complaints having reached Washington that the mails were being
obstructed and interstate commerce interfered with, President Cleveland
decided to send troops to Chicago. The Constitution requires that the
United States protect states against domestic violence on the application
of the legislature, or of the executive when the legislature is not
in session. Moreover the statutes of the United States empower the
President to use federal force to execute federal laws. The position
taken by the Governor of Illinois, John P. Altgeld, was expressed in
his telegram to President Cleveland protesting against the action of
the executive:

    Should the situation at any time get so serious that we cannot
    control it with the State forces, we will promptly and freely ask
    for Federal assistance; but until such time I protest with all due
    deference against this uncalled-for reflection upon our people,
    and again ask for the immediate withdrawal of these troops.

The President replied that troops were being sent in accordance with
federal law upon complaint that commerce and the passage of the mails
were being obstructed. A somewhat acrimonious correspondence between
the Governor and the President resulted but the troops were retained
and assisted in bringing the strike to a conclusion.

The attitude of the courts, meanwhile, had brought up a serious
situation. On July 2 a "blanket injunction" was issued by the United
States District Court of Illinois and posted on the sides of the cars.
It forbade officers, members of the Union and all other persons to
interfere in any way with the operation of trains or to force or
persuade employees to refuse to perform their duties. Under existing
law, anybody who disobeyed the injunction could be brought before the
Court for contempt, and sentenced by the judge without opportunity to
bring witnesses and to be tried before a jury. When Eugene V. Debs, the
president of the Union, and other officers continued to direct the
strike they were arrested for contempt of court and imprisoned.[6]
With federal troops against them and their officers gone, the strikers
could hardly continue and gave up in defeat. The loss in property and
wages had already reached $80,000,000.

The apportionment of the blame for so appalling a controversy was not a
simple task. On the one hand, a writer in the _Forum_ declared that

    The one great question was of the ability of this Government to
    suppress insurrection. On the one, side was the party of lawlessness,
    of murder, of incendiarism, and of defiance of authority. On the
    other side was the party of loyalty to the United States.

But this was a superficial view. A commission of investigation
appointed by President Cleveland looked into the matter more deeply.
Its unanimous report made important assertions: the Pullman Company,
while providing a beautiful town for its employees, charged rents
twenty to twenty-five per cent. higher than were charged in surrounding
towns for similar accommodations, and the men felt a compulsion to
reside in the houses if they wished to retain their positions; when
wages were reduced, the salaries of the better paid officers were
untouched, so that the burden of the hard times was placed on the
poorest paid employees; there was no violence or destruction of
property in Pullman, and much of the rowdyism in Chicago, but not all
of it was due to the lawless adventurers and professional criminals who
filled the city at that time;[7] when various public officials and
organizations attempted to get the Company to arbitrate the dispute,
the uniform reply was that the points at issue were matters of fact and
hence not proper subjects for arbitration; and the Managers'
Association selected, armed and paid 3,600 federal deputy marshals who
acted both as railroad employees and as United States officers, under
the direction of the Managers.

In view of the amount of labor disturbance after the Civil War, it was
noteworthy that it attracted the interest of political parties to so
slight a degree previous to 1896. In general the national platforms of
the two large parties reflected an indefinite if not remote concern
with the welfare of the wage earner. It was urged, to be sure, by both
protectionists and tariff reformers that customs duties should be
framed with the welfare of the laborer in mind, but the sincerity of
this concern was sometimes open to question. The smaller parties, as
usual, were far less vague in their demands. The Labor Reformers in
1872 demanded the eight-hour day, for example; the Greenbackers had a
definite program for relief in 1880; the Anti-Monopolists in 1884 and
the Union Labor and the United Labor parties in 1888. By 1892 the great
parties found themselves face to face with a growing labor vote. The
labor planks in the two platforms of that year were strikingly similar.
Each called for federal legislation to protect the employees of
transportation companies, but looked to the states for the relief of
employees engaged in manufacturing. Neither the Socialist Labor party
nor the Populists, however, were greatly troubled by the question of
the proper distribution between state and nation of the responsibility
for the welfare of the wage earner. Both proposed definite action; both
urged the reduction in length of the working day. The Populists
condemned the use of Pinkertons in labor disputes and the Socialists
urged arbitration, the prohibition of child labor, restrictions on the
employment of women in unhealthful industries, employers' liability
laws and the protection of life and limb.

In brief, then, the situation of the wage-earning classes in the middle
nineties was becoming accurately defined. The strike as a weapon was
open to serious objections. The leaders of the two large parties had
given no evidence of an effective and immediate interest in labor
unrest. The other political parties were too small to afford chances of
success. If less reliance was to be placed upon the strike and more
upon political action, either a third party must be constructed or the
leadership in one of the old ones must be seized. When the conference
of labor officials met in Chicago and concluded that the Pullman strike
was lost, it issued an address to the members of the American Railway
Union advising a return to work, closer organization of the laboring
class and the correction of industrial wrongs at the ballot box. If
this advice should be taken, and if the wage earner should attempt to
control legislation for his economic interest, as the propertied class
had long been doing for its benefit, the struggle might be shifted to
the political arena. The interest of the workers in the South and West
in the Populist movement suggested the possibility that such a shift
might occur.


BIBLIOGRAPHICAL NOTE

Surprisingly little attention has been paid to the social aspects of
the growth of the laboring classes before 1896. There is ample
material, however, on the more obvious sides of the labor movement,
such as the growth of the organizations and the use of the strike.

The _Documentary History of American Industrial Society_ (10 vols.,
1910-1911), contains a little documentary material on the period after
1865; J.R. Commons and others, _History of Labour in the United States_
(2 vols., 1918), is the best and most recent historical account; T.S.
Adams and H.L. Sumner, _Labor Problems_ (1905), is useful; consult also
R.T. Ely, _Labor Movement in America_ (3rd ed., 1890); C.D. Wright,
_The Industrial Evolution of the United States_ (1897), by a practical
expert; G.E. McNeill, _The Labor Movement_ (1887); J.R. Buchanan,
_Story of a Labor Agitator_ (1903); S.P. Orth, _The Armies of Labor_
(1919), contains a good bibliography; John Mitchell, _Organized Labor_
(1903); T.V. Powderly, _Thirty Years of Labor_ (1890); _Quarterly
Journal of Economics_ (Jan., 1887), Knights of Labor; J.H. Bridge,
_Inside History of the Carnegie Steel Co._ (1903). On the Haymarket
affair, compare _Century Magazine_ (Apr., 1893), and J.P. Altgeld,
_Reasons for Pardoning Fielden, Neebe and Schwab_; on the Pullman
strike, Grover Cleveland, _Presidential Problems_, and the report of
the commission of investigation in Senate Executive Documents, 53rd
Congress, 3rd session, vol. 2 (Serial Number 3276). Edward Stanwood,
_History of the Presidency_, contains political platform planks on
labor. The reports of the Commissioner of Labor (1886-), and of the
state bureaus of statistics of labor in such states as Massachusetts
(1870-), and New York (1884-), are essential for the investigator.

       *       *       *       *       *

[1] Cf. above, p. 64

[2] Two earlier organizations had a brief existence, the National
Labor Union and the Industrial Brotherhood.

[3] Above, pp. 133-134.

[4] For the effect on the Knights of Labor, see p. 310.

[5] For the legal side of this matter, consult Wright, _Industrial
Evolution_, 278-282.

[6] The Court based its action mainly on the provisions of Section 2
of the Sherman anti-trust law, which thus had an unforeseen effect. The
Supreme Court upheld the action, although on broader grounds. Above, p.
256, cf. 159 _U.S. Reports_, 564.

[7] In 1893 the "World's Fair" in Chicago had celebrated the four
hundredth anniversary of the landing of Columbus, and many of the
criminals attracted by the event had remained in the city.




CHAPTER XV


MONETARY AND FINANCIAL PROBLEMS

The critical monetary and financial situation during Cleveland's second
administration is understandable only in the light of a series of acts
which were passed between 1878 and 1893. It will be remembered that in
the former year the Bland-Allison act had provided for the purchase and
coinage of two million to four million dollars' worth of silver bullion
per month, and that the force behind the measure had been found chiefly
among westerners who wished to see the volume of the currency increased
and among mine owners who were producing silver.

The passage of the law did not end all opposition to the greater use of
silver, nor did it solve all our monetary difficulties. In the first
place, the United States sent delegates to an International Monetary
Conference in Paris, in conformity with one of the provisions of the
Bland-Allison act, to discuss a project for the utilization of silver
through an agreement among the commercial nations of the world. No
tangible results were obtained, however, so that it was plain that for
the time, at least, the United States would be alone in its attempt to
bring about the greater use of the white metal. In the meantime the law
was put into operation, and the secretary of the treasury exercised his
option by purchasing the minimum amount, two million dollars' worth of
bullion. It was impossible to keep the coins in circulation, however,
mainly because of their weight, and the policy was therefore adopted
of storing part of the silver in the government vaults and issuing
paper "silver certificates" in its place. As these were of small
denominations and circulated on a par with gold, no immediate
difficulty was experienced in making them part of the currency supply
of the country.

The currency question, nevertheless, remained as complicated as ever
and the differences of opinion upon it as diverse as before. The market
price of silver steadily declined through the eighties and the bullion
value of the metal in a dollar sank from ninety-three cents in 1878 to
less than seventy-one cents in 1889. Both Republican and Democratic
secretaries of the treasury gave warning that the inflow of silver into
the currency supply was too great. President Arthur urged the repeal of
the Bland-Allison act in his first annual message; President Cleveland
again and again reiterated the same advice, warning Congress of the
danger that silver would be substituted for gold. The argument of the
opponents of silver could hardly be stated in more concise or complete
terms. As soon as the supply of currency became too great, he asserted,
the unnecessary portion would go out of circulation;[1] it was the
experience of nations that the more desirable coin--gold, in this
case--would be hoarded by banks and speculators; it would then become
apparent that the bullion value of the gold dollar was greater than
that of the silver dollar and the two coins would part company; those
who, in such a contingency, could get gold dollars would demand a
premium for them, while the laboring man, unable to demand gold, would
find his silver dollar sadly shrunken in value.

Although the coinage of silver in the twelve years during which the
Bland-Allison act was in force amounted to $378,000,000, the danger
that Cleveland's prophecy would come to pass was lessened by several
facts. The country was, in the first place, passing through a period of
industrial expansion that required an enlarged circulating medium; the
revenues of the government were exceeding expenditures, and part of the
surplus was being stored in the vaults in Washington; and the volume of
the national bank notes shrank more than $158,000,000 between 1880 and
1890. Falling prices for agricultural products continued to keep
western discontent alive and far from being convinced by Cleveland's
warnings, western conventions and representatives in Congress continued
to urge legislation to increase the amount of silver to be coined, and
free-coinage bills were constantly introduced and frequently near
passage. Manifestly the demand that something more be done for silver
was not at an end.

Although agitation over the use of silver currency resulted in no
further important legislation for the time being, the general financial
situation was complicated by a series of important acts. During the
eighties the federal revenues mounted to an unprecedented height and as
expenses did not increase proportionately, a surplus of large and
finally of embarrassing and dangerous size appeared.

[Illustration:
Financial Operations, 1875-1897 in millions]

Between 1880 and 1890 it averaged more than $100,000,000 annually.
Although part of it was used to reduce the public debt, the remainder
began to accumulate in the treasury and thereby seriously reduced the
amount of currency available for the ordinary needs of business. In
1888, for example, the surplus in the treasury was one-fourth as great
as the entire estimated sum outside. The one device for doing away with
the surplus upon which all leaders could unite was the reduction of the
national debt. Between 1879 and 1890 over $1,000,000,000 were thus
disposed of. Yet even this process raised difficulties. Although a
portion of the debt came due in 1881 and could be redeemed at the
pleasure of the government, other bonds were not redeemable until 1891
and 1907, unless the federal authorities chose to go into the market
and buy at a premium. Eventually this was done for a time, although
prices were thereby forced up to 130 in 1888, and as a result the
redemption of $95,000,000 during the year cost more than $112,000,000.
The treasury also adopted the expedient of depositing surplus funds in
banking institutions, but the plan was open to serious objections. In
order to qualify for receiving government deposits the banks had to
present United States bonds as security, but these were already at a
high premium because of purchase by the treasury itself. There
remained, therefore, two general policies which might be
followed--reduction of revenue or enlargement of expenditure.

Both parties were theoretically committed to the economical conduct of
the nation's business, but Republican advocacy of a high tariff tended
to restrict that party's answer to the surplus problem. The revenue
came largely from tariff and internal taxes. The latter were reduced,
as has been seen, by the tariff act of 1883, but the redundant income
continued. The Republicans then faced the alternative of lowering the
customs or turning to the policy of increased expenditure. The latter
policy would delay the reduction of duties and was in line with the
Republican tendency toward increased federal activity. For the
Democrats the problem was easier. Since the party was tending toward
advocacy of low customs duties, had constantly condemned Republican
extravagance in administration and was traditionally the party of a
restricted national authority, it was logical to turn to severe
reduction of revenue in order to solve the problem of the surplus.

President Cleveland's political and personal philosophy led toward
economy in expenditure and therefore toward revenue reduction. By
nature he was frugal; in politics, a strict constructionist. In vetoing
an appropriation bill he succinctly set forth his creed:

    A large surplus in the Treasury is the parent of many ills, and
    among them is found a tendency to an extremely liberal, if not
    loose, construction of the Constitution. It also attracts the gaze
    of States and individuals with a kind of fascination, and gives
    rise to plans and pretensions that an uncongested Treasury never
    could excite.

The Republicans were becoming committed to the policy of large
expenditures. President Harrison, to be sure, in his first annual
message urged the reduction of receipts, declaring that the collection
of money not needed for public use imposed an unnecessary burden upon
the people and that the presence of a large surplus in the treasury was
a disturbing element in the conduct of private business. Nevertheless
such party leaders as Reed and McKinley, who effectively controlled the
legislation of the Harrison administration, acted on the philosophy of
Senator Dolph:

    If we were to take our eyes off the increasing surplus in the
    Treasury and stop bemoaning the prosperity of the country, ... and
    to devote our energies to the development of the great resources
    which the Almighty has placed in our hands, to increasing (our
    products) ... to cheapening transportation by the improving of our
    rivers and harbors, ... we would act wiser than we do.

Congress was more inclined to follow the policy suggested by Dolph than
that proposed by Cleveland. One project was the return of the direct
tax which had been levied on the states at the outbreak of the Civil
War. At that time Congress had laid a tax of $20,000,000 apportioned
among the states according to population. About $15,000,000 had been
collected, mainly, of course, from the northern states. It was
suggested that the levy be returned, a plan which would give the
northern states a return in actual cash and the southern states "the
empty enjoyment of the remission from a tax which no one now dared to
suggest was ever to be made good." President Cleveland had vetoed such
a bill, during his first administration, believing it unconstitutional
and also objectionable as a "sheer, bald gratuity." Under the Harrison
administration the scheme was revived and carried to completion, March
2, 1891.

Pension legislation was even more successful as a method of reducing
the unwieldy surplus. Garfield had declared in 1872, when introducing
an appropriation bill in the House of Representatives, "We may
reasonably expect that the expenditures for pensions will hereafter
steadily decrease, unless our legislation should be unwarrantably
extravagant," and in fact the cost of pensions for 1878 had been lower
by more than $7,000,000 than in 1871. The Arrears act of 1879 had given
a decided upward tendency to pension expense, which amounted to over
$20,000,000 more in 1880 than in 1879. The surplus was a constant
invitation to careless generosity. Liberality to the veteran was a
patriotic duty which lent itself to the fervid stump oratory of the
time and presented an opportunity to the undeserving applicant to place
his name on the rolls of pensioners along with his more worthy
associates. Besides, an administration which seemed niggardly in its
attitude toward the veterans was certain to lose the soldier vote, and
neither party was willing to incur such a risk. Hence, despite
Cleveland's vetoes of private pension legislation, hundreds of such
measures passed during his first term. The Harrison administration
proceeded upon the President's theory that it "was no time to be
weighing the claims of old soldiers with apothecary's scales." A
dependent pension bill like that which President Cleveland vetoed in
1887 was passed in 1890. The list of pensioners more than doubled in
length; the number of applications for aid increased tenfold in two
years. It became necessary for President Harrison to displace his
over-liberal commissioner of pensions, but the mischief was already
done. The total yearly pension expenditure quickly mounted beyond the
one hundred million mark, where it has remained ever since. Indeed, the
cost of pensions in 1872 when Garfield made his prophecy was less than
one-sixth as great as in 1913. Large pension expenditure was clearly a
permanent charge.

The improvement of the rivers and harbors of the country has always
been a ready means of disposing of any embarrassing surplus and of
assisting Congressmen to get money into their districts. "Promoters of
all sorts of schemes, beggars for the widening of rivulets, the
deepening of rills" clustered about the treasury during the eighties.
During the early seventies expenditure on this account had not reached
$6,500,000 annually, although in 1879 it exceeded $8,000,000. In 1882,
the year of the mammoth surplus, Congress passed over Arthur's veto a
bill carrying appropriations which amounted to almost nineteen million
dollars.[2] Expenditures were somewhat reduced in the years
immediately following, and Cleveland continued the repressive policy of
his predecessor. Harrison in his first message to Congress in December,
1889, recommended appropriations for river and harbor improvement,
although deprecating the prosecution of works not of public advantage.
The recommendation fell upon willing ears and appropriations for
undertakings of this sort at once increased again. Expenditure for
rivers and harbors, like that for pensions, remained at a high level,
the wise and necessary portions of such measures being relied upon to
carry the unwise and unnecessary ones.

A project which lacked many of the unpleasant features of river and
harbor legislation was the Blair educational bill, which proposed to
distribute a considerable portion of the surplus among the states. As
discussion of the Blair bill proceeded, it became clear that its
results might be more far-reaching than had been anticipated. A gift
from the national government seemed sure to retard local efforts at
raising school funds and would initiate a vicious tendency to rely on
federal bounty. Hence although the Senate passed the bill in 1884, 1886
and 1888, it never commended itself sufficiently to the House and
eventually was dropped.

A small portion of the increased expenditure in the eighties was due to
improvements in the navy, in which both parties shared. Presidents
Arthur and Cleveland urged upon Congress the need of modern defences.
Progress was slow and difficult. Although the day of steel ships had
come, the American navy was composed of wooden relics of earlier days.
The manufacture of armor and of large guns had to be developed, and
skill and experience accumulated. Results began to appear in the late
eighties when the number of modern steel war vessels increased from
three to twenty-two in four years. Expenditures mounted from less than
$14,000,000 in 1880 to over $22,000,000 in 1890.

As effective as new expenditure was the McKinley tariff act of 1890,
the details of which from the point of view of tariff history have
already been noted.[3] The extremely high rates levied under that
legislation caused a slight reduction in customs revenue in 1891 and a
sharp decline in 1892. Moreover the coincidence of instability in the
currency system, business depression and the relatively high
Wilson-Gorman tariff schedules of 1894 continued the decline of income
from customs during the middle nineties.

In the meantime the silver agitation, which had been somewhat repressed
by the well-known attitude of Cleveland during his first administration
revived with increased vigor. The election of 1888, it will be
remembered, had turned wholly on the tariff and had been a victory for
the Republicans. The western states had almost uniformly supported
Harrison in the election and during 1889 four more were admitted to the
Union. Their representatives in Congress were mainly silver advocates.
In his first message to Congress the President declared that the evil
anticipations which had accompanied the use of the silver dollar had
not been realized but he feared nevertheless that either free coinage
or any "considerable increase" of the present rate of coinage would be
"disastrous" and "discreditable." He announced that a plan would be
presented by the Secretary of the Treasury, to which he had been able
to give only a hasty examination. The scheme for expanding the silver
coinage which the Secretary, William Windom, presented was not
acceptable to Congress, but the result of the agitation was the law
generally known as the Sherman silver purchase act, which was passed on
July 14, 1890. It directed the secretary of the treasury to purchase
4,500,000 ounces of silver bullion per month and to issue in payment
"Treasury notes of the United States." These notes were legal tender
for all debts and were receivable for customs and all public dues.
Further, the secretary was directed to redeem the notes in gold or
silver at his discretion, "it being the established policy of the
United States to maintain the two metals on a parity with each other."

[Illustration:
Total Silver Coinage, 1873-1894, in millions of dollars]

The silver to be purchased was substantially the total output of the
American mines. Fearing the strength of the silver element in the
Senate and doubtful of the position which the President might take,
former Secretary Sherman, now in the Senate, supported the act,
although confessing that he was ready to vote for repeal at any time
when it could be done without substituting free coinage. The provision
for the purchase of four and one-half million ounces instead of four
and one-half million dollars' worth was introduced at Sherman's
suggestion. This clause kept the amount to be absorbed at a uniform
level, whereas the purchase of a fixed number of dollars' worth would
have increased the coinage when the price of bullion fell. The vote on
the Sherman act was strictly partisan--no Republicans opposing it and
no Democrats favoring it when the measure was finally passed, although
116 members of the House failed to answer to their names on the
roll-call.

In view of the fact that the industrial and commercial countries of
Europe were almost universally reducing their silver coinage, the
passage by the United States of an act which substantially doubled
the amount of silver purchased under the Bland-Allison law seems
extraordinary. Moreover, only six years later a presidential campaign
was fought almost wholly on the silver issue and at that time the
Republican party resolutely opposed free coinage. It is obvious that
powerful forces must have been at work to align the party so unitedly
in behalf of the Sherman law. It was to be expected that western
Republicans would support it, but the eastern members were found
voting for it as well. Doubtless many things contributed to the
result. Some perhaps agreed with Sherman that the silver advocates
were so strong that free coinage would result in case Congress refused
to pass legislation of any kind. Some may have feared with Platt of
Connecticut, that a party split would ensue unless the wishes of the
westerners were acceded to--hence an act which gave liberal assistance
to silver to please the West and South but stopped short of free
coinage so as to please the East. That opportunist politics had an
influence with certain members is indicated by the remarks of a
Massachusetts Republican representative who later favored the gold
standard:

    It is pure politics, gentlemen; that is all there is about it.
    We Republicans want to come back and we do not want you (to
    the Democratic side) to come back in the majority, because,
    on the whole, you must excuse us for thinking we are better
    fellows than you are. That is human nature, that is all there
    is in this silver bill (laughter on the Republican side); pure
    politics.

A Democrat who favored free coinage denounced the act as "Janus-Faced,"
moulded so as to look like silver to the West and gold to the East.
Important, also, seems to have been the attitude of the western members
on the tariff. The party had returned to power on the tariff issue and
it seemed necessary to pass some sort of legislation on the subject.
Yet the party majority in Senate and House was slight and the
westerners were understood to be ready to defeat the McKinley bill
which was then pending, unless something was done for silver. Harrison
seems to have been unwilling to endanger successful tariff legislation
by opposing the considerable extension of the coinage of silver.[4]

Contrary to the expectations of the proponents of the act, the price of
silver fell gradually until the value of the bullion in a dollar was
sixty cents in 1893 and forty-nine cents in 1894. They who had opposed
the law saw their fears verified; as they had prophesied, silver began
to replace gold in circulation; the latter was hoarded and used for
foreign shipments; customs duties, which had hitherto been paid largely
in gold, were now paid in paper currency; since gold was now more
desired than silver, large amounts of paper were presented to the
government for redemption in the more valuable metal. To be sure, the
Sherman law allowed the secretary of the treasury to redeem the
treasury notes of 1890 in gold or silver at his discretion, but it
contained a proviso that the established policy of the United States
was to maintain the two metals on a parity or equality. The secretary
believed that if he refused to redeem the treasury notes in whatever
coin the holder desired, that is if he insisted on redemption in silver
only, a discrimination would be made in favor of gold and the equality
of the two metals would be destroyed. Parity would be maintained, the
government held, only when any kind of money could be exchanged for any
other kind, at the option of the holder.

For the redemption of the greenbacks, the government had since 1879
maintained a fund known as the gold reserve. No law fixed its amount,
but custom had set $100,000,000 as the minimum. Hitherto a negligible
amount of paper had been presented for redemption, but as soon as the
Sherman law came into effective operation the demand for gold became
increasingly great and the level of the reserve promptly fell. Between
July 1, 1890, and July 15, 1893, the supply of gold in the treasury
decreased more than $132,000,000, while the stock of silver increased
over $147,000,000. Evidently silver was replacing gold in the treasury,
and it was equally clear that a continuation of the process would
result in forcing the government to pay its obligations in silver and
to refuse to redeem paper in gold--in other words, go upon a silver
standard.

The situation when Cleveland's second administration began on March 4,
1893, was complex and critical. The annual expenditures had increased
by $119,000,000 between 1880 and 1893, while the revenue had expanded
by only half that amount; the surplus had decreased every year during
Harrison's administration and a deficit had been avoided only by the
cessation of payments on the public debt; the supply of currency in
circulation was being heavily increased by the operation of the Sherman
law; and the gold reserve had been kept at the traditional amount only
through extraordinary efforts on the part of Harrison's Secretary of
the Treasury as the administration came to a close.

Cleveland's attitude toward the Sherman law was well-known. He had long
urged the repeal of the Bland-Allison act; before the election of 1892
he had predicted disaster in case the nation entered upon "the
dangerous and reckless experiment of free, unlimited, and independent
silver coinage"; it was his belief that the distresses under which the
country labored were due principally to the Sherman silver purchase
law. He therefore called a special session of Congress for August 7,
(1893), sent a message giving a succinct account of the operation of
the law and urged its immediate repeal.[5] In the House, repeal was
voted with surprising promptness, although a strong free-silver element
fought vigorously to prevent it. That party lines were broken was
indicated by the fact that two-thirds of the Democrats and four-fifth
of the Republicans voted in accord with the President's request.

In the Senate the silver advocates were stronger. The entire history of
coinage was discussed at length. Members who favored repeal disliked to
overturn the tradition of the Senate which allowed unlimited debate,
and the silver senators therefore filibustered through the summer and
early fall. Senator Jones of Nevada made a single speech that filled a
hundred dreary pages of the _Congressional Record_. Senator Allen of
Nebraska quoted more than thirty authorities, ranging from the Pandects
of Justinian to enlivening doggerel poetry. Feeling ran high. In the
West, Jones, Allen and others were looked upon as heroes; in the East,
as villains. To a satirical onlooker it seemed that the nation had
become insanely obsessed with the question of repeal:

    All men of virtue and intelligence know that all the ills of
    life--scarcity of money, baldness, the comma bacillus, Home
    Rule, ... and the Potato Bug--are due to the Sherman Bill. If it
    is repealed, sin and death will vanish from the world, ... the
    skies will fall, and we shall all catch larks.

Not until October 30 were the silver supporters overcome. Including
members who were paired, twenty-two Democrats and twenty-six
Republicans favored repeal, and twenty-two Democrats, twelve
Republicans and three Populists opposed. Again the West and South were
aligned against the North and East. The Democratic party was divided
and charges and countercharges had been made that augured ill for party
success, as has been seen, in dealing with the tariff and other
important problems.[6] Worst of all, the chief question--the volume
and content of the currency--was still unanswered. Something had been
done for silver--and undone--but there was no scientific settlement of
the problem.

The disastrous financial and industrial crisis of 1893 made yet more
complex the already tangled skein of economic history during President
Cleveland's second administration. The catastrophe has been ascribed to
a variety of causes but the relative importance of the various factors
is still a matter of disagreement. Rash speculation on the part of
industrial interests here and abroad seems to have made weak links in
the international commercial chain; financial conditions both in
Germany and in Great Britain were precarious during the early part of
1890; the collapse of the Philadelphia and Reading Railroad in
February, 1893, and of the National Cordage Company soon afterwards
were warnings of what was to follow; the silver purchase law produced
widespread fear that the United States would not be able to continue
the redemption of paper currency; and the change of political control
had produced the usual feeling of uncertainty. The dwindling of the
gold reserve, which has already been mentioned, assisted in causing a
critical situation. Foreign investors, fearful of financial conditions
here, sold their American railroad and other securities and received
payment in gold. The one place where the yellow metal could be readily
obtained was the United States treasury and upon it the strain
centered. People attempted to turn property of all kinds into gold
before the existing standard should change to a depreciated silver
basis. At the same time there was a rush to the banks to withdraw
funds, and the visible supply of currency therefore was seriously
reduced. "Under these conditions gold seemed scarce. In reality gold
was only relatively scarce in comparison with the abnormal offering of
property for sale on account of the fear of the silver standard." In an
incredibly short time, currency became so scarce as to create a genuine
panic and was purchased like any commodity at premiums ranging from one
to three per cent. In order to enable their families to pay the running
expenses of every day at the summer resorts, business men were
compelled to buy bills and coin and send them in express packages. The
national banks were unable to supply the demand for currency so
quickly, and 158 of them failed in 1893 and hundreds of state and
private financial institutions were forced to close their doors.
Industrial firms were affected by the uncertainty and panic and over
15,000 failures resulted, with liabilities amounting to $347,000,000 in
the single year. Production of coal and iron fell sharply; railway
construction nearly ceased and the value of securities shrank to a
fraction of their former value. The distress among the wage-earners
became extreme; unemployment was common; strikes, like that beginning
in Pullman in 1894, were bitter and prolonged. "Coxey's army," composed
of unemployed workmen, marched to Washington with a petition for
relief.

As is usually the case in our politics, the blame for the industrial
disturbance was laid at the door of the party in power. The argument of
an Ohio congressman in the debate over the repeal of the Sherman law
typified the political use made of the crisis of 1893. Until November,
1892, the orator declared, prosperity was undimmed. "Iron furnaces
throughout the country were in full blast, and their cheerful light was
going up to heaven notifying the people of the United States of
existing prosperity and warning them against change of conditions."
Then came the election of the party "which had declared war on the
system upon which our whole industrial fabric had been erected." "One
by one the furnaces went out, one by one the mines closed up, one after
another the factories shortened their time." Business interests, he
asserted, were fearful of Democratic rule and especially of tariff
reform; hence prosperity and confidence could be renewed only by
leaving the Sherman law intact and by refusing to undertake any
sweeping revision of the protective tariff.

[Illustration:
Net Gold in the Treasury, by months,
Jan., 1883 to Feb., 1896, in millions of dollars]

Further to complicate the financial trials of the burdensome mid-nineties,
the depletion of the gold reserve demanded immediate attention. During
the closing months of President Harrison's administration, in fact, the
Secretary of the Treasury had ordered the preparation of plates for
engraving an issue of bonds by which to borrow sufficient gold to
replenish the redemption fund. By a personal appeal to New York bankers,
however, he was able to exchange paper for gold and so keep the level
above the one hundred million mark, and when Cleveland succeeded to
the chair, the reserve was $100,982,410. In the meantime the scarcity
of gold continued, and the combination of large expenditures and
slender income severely embarrassed the government in its attempts to
obtain a sufficient supply of gold to keep the reserve intact. The
administration, indeed, was all but helpless. Paper presented for
redemption in gold had to be paid out to meet expenses and was then
turned in for gold again. Hence, as Cleveland ruefully reminded
Congress, "we have an endless chain in operation constantly depleting
the Treasury's gold and never near a final rest." On April 22, 1893,
the reserve fell momentarily below $100,000,000 and later in the year
it was apparent that the reduction was likely to become permanent.
By January, 1894, the reserve was less than $70,000,000, while
$450,000,000 in paper which might be presented for redemption were in
actual circulation. Only one resource seemed available--borrowing gold.
The treasury therefore sold bonds to the value of $50,000,000. Even
this, however, did not remedy the ill. Bankers obtained gold to
purchase bonds by presenting paper currency to the government for
redemption. Relief was temporary. On the last day of May the reserve
amounted to only $79,000,000; in November, to $59,000,000. Another
issue of bonds was resorted to in November, but the results were not
better than before. At the same time the Pullman strike during the
summer months, the Wilson-Gorman tariff fiasco and an unfortunate
harvest seemed to indicate that man and nature were determined to make
1894 a year of ill-omen.

By February, 1895, the treasury found itself confronted with a reserve
of only $41,000,000. It seemed useless to attempt borrowing under the
usual conditions, and Cleveland therefore resorted to a new device. A
contract was made with J.P. Morgan and a group of bankers for the
purchase of 3,500,000 ounces of gold to be paid for with United States
four per cent. bonds. In order to protect the reserve from a renewed
drain, the bankers agreed that at least half the gold should be
obtained abroad, and they promised to exert all their influence to
prevent withdrawals of gold from the treasury while the contract was
being filled. The terms of the contract were favorable to the bankers,
but the President defended the agreement on the ground that the
promise to protect the reserve entitled the bankers to a favorable
bargain. The fact, however, that the Morgan Company was able to market
the bonds with the public and make a large profit, increased the
demand that the administration sell directly to the people and make
the profit itself. In January, 1896, occurred a fourth sale--to the
public, this time--and 4,640 bids were received, for a total several
times greater than the $100,000,000 called for. By this time, business
conditions were improving, confidence was restored among the financial
classes and gold again began to flow out of hiding and into the
treasury. The endless chain was broken.

The denunciation which Cleveland received for the untoward monetary and
industrial events of his administration was unusual even for American
politics in the middle nineties. Such extreme silver men as Senator
Stewart of Nevada declared that Cleveland's second administration was
probably the worst administration that ever occurred in this or any
other country; that he was a bold and unscrupulous stock-jobber; that
he deliberately caused the panic of 1893 and that he sent the Venezuela
message in order to divert the attention of the people from the silver
question. The New York _World_ described the transaction between the
government and the Morgan Company as a "bunco" game, and charged that
Cleveland had dishonest, dishonorable and immoral reasons for bringing
about the transaction and that he did it for a "consideration."
Representative W.J. Bryan, who belonged to the President's party and
who ordinarily was chivalrous to his opponents, declared that Cleveland
could no more escape unharmed from association with the Morgan
syndicate than he could expect to escape asphyxiation if he locked
himself up in a room and turned on the gas. The Democratic party, he
thought, should feel toward its leader as a confiding ward would feel
toward a guardian who had squandered a rich estate, or as a passenger
would feel toward a trainman who opened a switch and precipitated a
wreck.


BIBLIOGRAPHICAL NOTE

The standard works, mentioned under Chapter V, by Dewey, Hepburn and
Noyes continue valuable. The attitude of Hayes and of succeeding
Presidents is found in J.D. Richardson, _Messages and Papers of the
Presidents_; F.W. Taussig, _The Silver Situation in the United States_
(1892), is concise; _Political Science Quarterly_, III, 226, discusses
the surplus revenue; _Quarterly Journal of Economics_, III, 436, on the
direct tax; W.H. Glasson, _Federal Military Pensions_, has already been
mentioned. W.J. Lauck, _Causes of the Panic of 1893_ (1907), lays the
blame for the industrial distress of 1893 wholly on the silver law of
1890. On the gold reserve, consult Grover Cleveland, _Presidential
Problems_; D.R. Dewey, _National Problems_ (1907); _Political Science
Quarterly_, X, 573; and _Quarterly Journal of Economics_, XIII, 204.
"The Silver Debate of 1890," in _Journal of Political Economy_, I, 535,
contains a detailed account of the discussion in Congress. W.J. Bryan,
_First Battle_ (1897), should be consulted.

       *       *       *       *       *

[1] According to the principle known as Gresham's law, bad money tends
to drive out good; or overvalued money to drive out undervalued money.
If the face value of a coin is more than its worth as bullion, it is
"overvalued." Thus, if coins of equal face value, but of different
bullion value, circulate side by side, there will be a tendency for the
possessors of the coins to pass on the currency with the smaller
bullion value and to withdraw the others for sale as bullion and for
use in the arts.

[2] Above, p. 164.

[3] Above, pp. 238-240.

[4] The law remained in force about three years. During that interval
nearly $156,000,000 worth of silver bullion was purchased with the new
treasury notes. The government began retiring these notes in 1900.

[5] The call for the extra session, together with news of the
suspension of free-coinage in India, sent the bullion price of silver
down twenty-one cents per ounce in two weeks. The President was
seriously handicapped at this time by a cancerous growth in the jaw,
necessitating an operation, news of which was withheld from the public
for fear of its ill effect on the financial situation. Cf. _Saturday
Evening Post_, 22 Sept., 1917.

[6] Above, p. 274.




CHAPTER XVI


1896

The political situation in 1896, when the parties began to prepare for
the presidential election, was more complex than it had been since
1860. The repeal, in 1893, of the purchase clause of the Sherman silver
act had divided the Democrats into factions; the financial and
industrial distress in the same year had been widely attributed to fear
of Democratic misgovernment; the Wilson-Gorman tariff act of 1894 had
discredited the party and aroused ill-feeling between the President and
Congress; the Pullman strike and the use of the injunction had aroused
bitterness in the labor element against the administration; the income
tax decision of 1895 had done much to shake popular confidence in the
Supreme Court; the Hawaiian and Venezuelan incidents had caused minor
dissent in some quarters; and the bond sales had made Cleveland
intensely unpopular in the West and South. The Democratic party was
demoralized and leaderless. The Republicans were better off because
they had been out of power during the years of dissension and panic,
but they had been without a leader since the death of Blaine in 1893
and were far from united in regard to the most pressing issues. Indeed,
the sectional differences in both parties, and the unexpected strength
of the Populist movement caused no little anxiety among the political
leaders. And finally, the volume and character of the currency was
still undetermined. The Democrats had divided on the question. The
Republicans were almost as little united; they had played politics in
passing the Sherman silver act and three years later had assisted a
President of the opposite party in accomplishing the repeal of its most
important provision. From the standpoint of the silver supporters
neither party organization was to be trusted. The outstanding political
questions of 1896, therefore, were whether the supporters of silver
could capture the machinery of one of the parties and whether the other
unsettled issues could ride into the campaign on the strength of the
financial agitation. The answers to these questions gave the campaign
and election its peculiar significance.

The background of 1896 is to be found in the South and West, where the
farmers' alliances and the Populist party continued their success in
arousing and directing the ambitions of the discontented classes. In
1892, it will be remembered, the Populists had cast more than a million
ballots and had chosen twenty-two presidential electors, two senators,
and eleven representatives. In 1894, at the time of the congressional
election, they had increased their voting strength more than forty per
cent., and had elected six senators and six members of the House,
besides several hundreds of state officials. In the Senate it happened
that the two great parties had been almost equally strong, after the
election of 1894, so that the Populist group had held the balance of
power. The insistence of the South and West that Congress do something
further for silver had not lessened. A measure providing for the
coinage of a portion of the silver bullion in the treasury had been
defeated in 1894 only through the President's veto. Indeed the only
hope of the East and of the supporters of the gold standard was the
unflinching determination of the head of a party to which the East and
the gold supporters were, in the main opposed.

The growing enthusiasm for silver which was sweeping over the South and
West and rapidly developing into something resembling frenzy was
difficult for the more stolid East to comprehend. Not merely the
politician, but the man on the street and in the store, the
school-teacher, the farmer and the laborer, in those portions of the
country, fell to discussing the virtues of silver as currency and the
effect of a greater volume of circulating medium upon prices and
prosperity. The two metals became personified in the minds of the
people. Gold was the symbol of cruel, snobbish plutocracy; silver of
upright democracy. Gold deserted the country in its hour of need;
silver remained at home to minister to the wants of the people. Such
arguments as those presented in _Coin's Financial School_, published in
1894, brought financial policy within the circle of the emotions of its
readers even if they did not satisfy the more critical student of
monetary problems. This influential little volume, written by W.H.
Harvey, acted as a hand-book of free coinage, cleverly setting forth
the major arguments for the increased use of silver and bringing
forward objections which were triumphantly demolished. Simple
illustrations enforced the lessons taught by its pages: a wood-cut of a
cripple with one leg indicated how handicapped the country was without
the free coinage of two metals; in another, Senator Sherman and
President Cleveland were depicted digging out the silver portion of the
foundations of a house which had been erected on a stable basis of both
gold and silver; in a third, western farmers were seen industriously
stuffing fodder into a cow which capitalists were milking for the
benefit of New York and New England.[1] With the enthusiasm and the
sincerity of the early crusaders, the people assembled in ten thousand
schoolhouses to debate the absorbing subject of the currency. Indeed
the South and West had become convinced that the miseries inflicted
upon mankind by war, pestilence and famine had been less "cruel,
unpitying, and unrelenting than the persistent and remorseless
exaction" which the contraction of the volume of the currency had made
upon society. Low prices, the stagnation of industry, empty and idle
stores, workshops and factories, the increase of crime and
bankruptcy--all were laid at the door of the gold standard.

The East looked upon the rising in the West at first with amusement,
and was quite ready to accept the diagnosis of a western newspaper man,
quoted by Peck in his _Twenty Years of the Republic_:

    What's the matter with Kansas?

    We all know; yet here we are at it again. We have an old
    moss-back Jacksonian who snorts and howls because there is a
    bath-tub in the State House. We are running that old jay for
    Governor.... We have raked the ash-heap of failure in the State
    and found an old human hoop-skirt who has failed as a business
    man, who has failed as an editor, who has failed as a preacher,
    and we are going to run him for Congressman-at-large.... Then we
    have discovered a kid without a law practice and have decided to
    run him for Attorney-General.

Later the East looked upon tendencies in the West with more concern:
Roosevelt, although admitting the honesty of the Populists, characterized
their ignorance as "abysmal"; others were more inclined to doubt their
sincerity; their conventions were supposed to be made up of cranks and
unsexed women; and their principles were looked upon as "wild and crazy
notions."

In fact it was no simple task to distinguish between the legitimate
grievances and ambitions of the westerners, and their eccentricities
and errors. Nor was this difficulty lessened by the reputation with
which some of the proponents of silver were justly or unjustly
credited. "Sockless Jerry" Simpson and Mrs. Lease were among them--the
Mrs. Lease to whom was ascribed the remark "Kansas had better stop
raising corn and begin raising hell!"[2] Benjamin R. Tillman was
another--a rough, forceful character, leader of the poor whites and
small farmers of South Carolina, organizer of the "wool hats" against
the "silk hats" and the "kid gloves"--Governor of the state and later
member of the federal Senate. Although a Democrat, he was thoroughly at
odds with Cleveland, and publicly declared it was his ambition to stick
his pitchfork into the President's sides.[3] Richard P. Bland, of
Missouri, had the disadvantage of having been one of the earliest of
the silver supporters, since he had initiated the bill which resulted
in the Bland-Allison act, and was looked upon in the East as a
thorough-going, free-silver radical. Governor Altgeld, of Illinois,
leader of the Democrats of that state from 1892 to 1896, was a
successful lawyer who was looked upon by his friends as a
liberal-minded humanitarian, the friend of

    The mocked and the scorned and the wounded,
    the lame and the poor,

whose sympathies with the laboring classes had given him the support of
the reformers and the wage earners. But his pardon of the Haymarket
anarchists and his attitude during the Pullman strike had led the East
to regard him as a dangerous revolutionist and an enemy to society.[4]

The free-silver movement nevertheless continued to gather momentum. For
some years influential silver advocates had been associated in the
Bimetallic League, an organization which supported the free coinage
of both gold and silver. Among its members were prominent Democrats,
Republicans and Populists, especially from the western states, and some
of the foremost labor leaders. At one of its meetings in 1893 it was
determined to invite every labor and industrial organization in the
country to send delegates. A few experts, even in the East, gave some
scientific support to the argument for the greater use of silver.
Eastern Republicans like Senator Henry Cabot Lodge proposed free coinage
of both metals by an international agreement, which, they thought,
might be brought about through threats of tariff discrimination against
nations refusing to adhere to the arrangement. A silver convention in
Nebraska in 1894 was attended by a thousand delegates. From the point of
view of party harmony the subject was a nuisance. Democratic state
conventions were badly divided. Thirty of them adopted resolutions
distinctly favorable to free coinage and fourteen opposed. Ten of the
latter committed themselves definitely to the gold standard. The
fourteen included all the northeastern states, together with Michigan,
Wisconsin and Minnesota. Such gold Democrats as President Cleveland
sought to stem the tide, but Cleveland's control over his followers was
rapidly dwindling, and it seemed likely that the silver element of the
party might reach out to seize the organization and displace the former
leaders.

The Republican professional politicians were as ignorant of technical
monetary problems as the Democrats, and moreover did not wish to risk
popular disapproval in any section by utterances which might be
offensive to that part of the country. The first Republican state
convention during 1896 was that in Ohio. Its financial plank was
awaited with interest, because of the early date of the meeting and
because its proceedings were in the hands of friends of the most
prominent candidate for the Republican presidential nomination. The
convention dodged the issue by demanding that all our currency be
"sound as the Government and as untarnished as its honor," and that
both metals be used as currency and kept at parity by legislative
restrictions. The New York _Tribune_ thought that this could mean
nothing but a gold standard; the _Times_ was fearful that it would lead
to silver; the _Springfield Republican_ condemned it as "chock full of
double-dealing." Its ambiguity, however, was in line with the purposes
and ambitions of two men who were actively preparing for the campaign
of 1896--Marcus A. Hanna and Major William McKinley.

Marcus A. Hanna, or "Mark" Hanna as he was universally known, was an
Ohioan, born in 1837.[5] As a young man he entered upon a business
career in Cleveland, first in a wholesale grocery company, later in a
coal and iron firm and finally in a variety of industrial and
commercial enterprises which his energy and ability opened to him. The
expansion of industrial America after the Civil War was coincident with
the greater part of Hanna's career and he was a typical product of that
period in his political, economic and social philosophy. After he had
attained a degree of business success he became actively interested in
politics and took a prominent part in placing Joseph B. Foraker in the
governor's chair in Ohio in 1885. Strained relations between the two
turned Hanna's attention to the fortunes of John Sherman. When it
became apparent in 1888 that the presidential campaign would turn upon
President Cleveland's tariff principles, Hanna, who looked upon the
protective tariff as synonymous with industrial expansion and even of
industrial safety, threw his weight upon the side of Sherman, who was
again seeking the Republican nomination. The failure of Sherman was a
blow to Hanna, but it called to his attention the pleasing personality
of a more prominent protectionist, William McKinley. He was an
important agent in McKinley's successful campaign for the governorship
of Ohio in 1891. Two years later the Governor met serious financial
reverses, and again Hanna proved to be a firm friend. Aided by other
men of means he rescued McKinley from bankruptcy. Between the two there
sprang up a mutual admiration of unusual strength, and finally, in
1894-1895, Hanna withdrew from his business enterprises in order to
devote his entire time to the political fortunes of his friend.

Mark Hanna had extraordinary capacity for leadership. Sociable,
open-handed, full of energy, direct, aggressive, shrewd, daring, a hard
fighter, a loyal friend, an organizer and a man of his word, he was
essentially a man of action. In politics he was practical and
straight-forward. He wanted results, not reforms, and results meant
accepting the prevailing methods and using them. When he wished a
street-railway franchise in Cleveland, he bought enough influence with
the city government to get what he wanted, as others of his day did. He
was a strict party man; good government and safety to industry, he
believed, were dependent upon Republican control. Patriotism therefore
demanded his utmost energy in getting Republicans elected. In political
campaigns his counsel, his energy and his money were always available.
A protective customs tariff, a "sound" currency system and a free hand
in the conduct of business were the things which he most desired from
the government.

William McKinley would have been a formidable competitor for the
presidential nomination in 1896 even without the assistance of his
rugged friend. His personality was attractive, in a pleasing, soothing,
tactful, ingratiating way. His military career had been honorable even
if not famous. For most of the time from 1877 to 1891 he had been a
member of the House of Representatives, becoming identified
particularly with the high protective tariff and acting as sponsor for
the McKinley act of 1890. After being defeated for re-election, just
subsequent to the passage of the tariff law, he had become Governor of
Ohio for two terms. The panic of 1893 and the ill-fated Wilson-Gorman
tariff act during the time when he was Governor caused the tide of
popular favor to swing away from the Democrats; McKinley, as the
apostle of protection, appeared in a more favorable light; and his
partisans began to press him forward as the logical nominee for 1896
and as "the advance agent of Prosperity." The fact that his home was in
a populous state in the Middle West was also in his favor, because the
Republicans had frequently chosen their candidate from this debatable
ground rather than from the Northeast, where success was to be had
without a struggle.

Hanna's first care upon determining to devote himself to the interests
of McKinley was to keep the candidate before the people as the one man
who could rescue the nation from industrial depression. To that end he
widely circulated the Cleveland _Leader_, a strong McKinley organ, for
eighteen months at his own expense; he rented a house in Georgia,
entertained Governor McKinley there and brought numbers of southern
politicians to meet the candidate; and experienced political workers
were sent all over the country and especially to the South to prepare
the way for the election of delegates to the nominating convention.
Hanna himself went to the East to discover on what terms the support of
some of the states in that section could be obtained. On his return he
reported that aid would be assured by a guarantee that the patronage of
the administration would go to certain powerful politicians; Hanna
thought the bargain a desirable one, but the candidate objected and
Hanna acquiesced. The campaign of publicity and of personal canvass for
delegates and influence continued. First and last, it is estimated,
Hanna contributed over $100,000 for this purpose, urging his assistants
always to use funds only for legitimate ends, although promising
McKinley partisans who aided in the work that they would be "consulted"
in the disposition of patronage.

Two difficulties stood in the way of completely ensuring the choice of
McKinley as the candidate by the convention. Several states had
"favorite sons" whom they would be sure to present, and if so many of
these should appear as to prevent McKinley's nomination on the first
ballot or at least on an early one, there might be a stampede to an
unknown man--a "dark horse"--and then Hanna's ambitions would be
frustrated. Thomas B. Reed of Maine was an especial source of anxiety
as he possessed considerable strength throughout New England. To guard
against such a danger, Hanna sedulously cultivated the popular demand
for Governor McKinley and also fought in the state conventions for
delegates even against favorite sons. A crucial state was Illinois,
where Senator Cullom was powerful. The Senator says that a
representative of McKinley offered him "all sorts of inducements" to
withdraw, but McKinley's biographer mentions no such attempt at a
bargain. Eventually Cullom made the fight and was defeated, and from
then on, the nomination of McKinley seemed sure unless he should be
tripped by the currency issue.

The silver question was the second obstacle in the way of success. Not
only was the party divided, but McKinley's record on the subject was
far from consistent. He had voted for the Bland free-silver bill in
1877, for the Bland-Allison act in 1878 and for the passage of that act
over President Hayes's veto. In 1890 he had urged the passage of the
Sherman silver purchase law, intimating that he would support a free
coinage measure if it were possible to pass it. Hardly more than a year
later he was campaigning for the governorship of Ohio, and there he
denounced the free coinage of silver and advocated international
bimetallism. In 1896 McKinley feared that a definite public utterance
on the one side or the other of the question would widen the division
in the party, prevent his nomination and lose the election. Hence the
ambiguous currency plank in the Ohio state convention and hence, also,
the refusal of the candidate to commit himself openly. Nevertheless he
commissioned a friend to go to the East and explain his attitude
privately to certain leaders and prominent business men, urging them
not to force a declaration for gold before the convention met. In this
way, he thought, the currency issue might be subordinated, the tariff
emphasized and the party held together. In this state of uncertainty
the currency situation was allowed to rest until the convention met at
St. Louis on June 16.

The platform adopted was, for the most part, of the usual sort. It
urged popular attention to the matchless achievements of thirty years
of Republican rule and contrasted that period of "unequalled success
and prosperity" with the "unparalleled incapacity, dishonor, and
disaster" of Democratic government; it promised the "most ample
protection" to the products of mine, field and factory; generous
pensions, American control of Hawaii, a Nicaragua canal, the Monroe
doctrine, restricted immigration and the arbitration of labor disputes
affecting interstate commerce received the support of the party.

It was the currency plank, however, that differentiated the platform of
1896 from that of other campaigns. Many Republican leaders and business
men, particularly in the East, were disposed to call for a definite
party statement in favor of a gold standard and had reached the point
where they could not be put off by the usual meaningless straddle.
Thomas C. Platt, Henry Cabot Lodge, Joseph B. Foraker, Charles W.
Fairbanks and other party chiefs were among them. Hanna was ready to
declare for gold after he had been assured of the nomination of his
candidate. McKinley was willing to stand for gold, although he
preferred not to mention that word in the plank and hoped to make the
contest on the tariff. Moreover so many silver delegates had already
been elected to the Democratic convention, which was soon to be held,
that a definite utterance from that party seemed a certainty. The
Prohibitionists had already divided into halves over the dominant
issue. It was almost imperative, therefore, for the Republican
convention to be more explicit than it had hitherto ventured to be. As
leader after leader arrived who was insistent upon a gold standard, it
became increasingly evident to Hanna that he must proceed with caution.
If McKinley committed himself to gold, the silver advocates would balk
at his candidacy, and perhaps unite on somebody else; if he committed
himself to silver, he would lose the eastern leaders. The astute Hanna
therefore allowed sentiment in favor of the gold plank to gather force,
although holding the discussion as far as possible under cover, and
kept McKinley from making a definite statement. Then at the last
minute, when the McKinley delegates were numerous enough to ensure the
nomination of the Major and when it was too late for the silver forces
to agree upon an opposition candidate, Hanna gave way to the pressure
for gold and agreed to the plank which he had always favored.[6]

Despite the canny management of Hanna a defection took place over the
decision on the currency issue. As soon as the platform was read,
Senator Henry M. Teller, of Colorado, moved to replace the gold plank
by one advocating the free coinage of silver. The earnestness with
which Teller urged the adoption of the substitute was an indication of
the sincerity of the western wing of the party. He had been a strict
Republican since the formation of the party in the mid-fifties, yet he
now found himself forced to accept a policy which he believed to be
pernicious or break the political bonds which had held him for forty
years. The majority of the convention, however, was determined to adopt
the gold plank and overwhelmingly defeated the Teller amendment,
whereupon the Senator and thirty-three other silver supporters solemnly
withdrew from the hall.

The way was now clear for the nomination of a candidate. Thomas B.
Reed, Senator Quay and other favorite sons received but scant support,
and McKinley was nominated by an overwhelming majority on the first
ballot. Garrett A. Hobart, a lawyer and business man whose reputation
was confined to New Jersey, his home state, was nominated for the
vice-presidency. The platform and the candidate were generally hailed
with favor in the East. To be sure, critical newspapers were inclined
to look askance upon McKinley's past. The New York _Evening Post_, for
example, favored a gold standard but decried the candidate's "absence
of settled convictions about leading questions of the day, and his want
of clear knowledge on any subject." Yet on the whole, the platform and
the candidate were popular, and, in view of the serious factional
disputes among the Democrats, the Republicans seemed likely to make
good their boast that victory would be so easy that they could nominate
and elect a "rag baby" if they chose. The redoubtable Hanna was
appointed chairman of the National Republican Committee, from which
office he was to direct the campaign. McKinley still believed that the
contest would be of the old-fashioned sort and that it would turn on
the tariff, despite the platform utterance of the party. And so it
might have proved had it not been for an important change of purpose
and leadership in the opposition.

The friends of free silver coinage went to the Democratic convention at
Chicago on July 7 with the same determination to get a definite
statement on the currency question that had characterized the eastern
leaders at the Republican convention. Without the loss of a moment they
wrested the control of the organization from the former leaders by
defeating Senator Hill of New York, a gold Democrat, for the temporary
chairmanship and electing Senator Daniel of Virginia, a recognized
proponent of free silver. Hill's support came mainly from the
Northeast; Daniel's, from the West and South. Senator White of
California, a representative of the silver wing, was then chosen
permanent chairman and the convention was ready for the contest over
the platform. While it awaited that document, however, it listened to
several favorite leaders, of whom Senator Tillman and Governor Altgeld
of Illinois were the best known. From the sentiments expressed by these
men it was clear that the radical Democrats believed that they were
speaking for the masses of the people and that they were bent upon
making far-reaching changes both in the organization and the creed of
the party.

A disquieting feature was a degree of turbulence beyond that which
usually characterizes our nominating conventions. The official
proceedings record the following, for example, while Senator Tillman
was addressing the delegates:

    I hope that when this vast assembly shall have dispersed to its home
    the many thousands of my fellow-citizens who are here will carry
    hence a different opinion of the pitchfork man from South Carolina
    to that which they now hold. I come to you from the South--from the
    home of secession--from that State where the leaders of--(the
    balance of the sentence of the speaker was drowned by hisses). Mr.
    Tillman (resuming): There are only three things in the world that
    can hiss--a goose, a serpent, and a man....

    In the last three or four or five years the Western people have come
    to realize that the condition of the South and the condition of the
    West are identical. Hence we find to-day that the Democratic party
    of the West is here almost in solid phalanx appealing to the South,
    and the South has responded--to come to their help.... Some of my
    friends from the South and elsewhere have said that this is not a
    sectional issue. I say it is a sectional issue. (Long prolonged
    hissing.)

At length, the platform was presented. It was a summary of the
complaints against the East which had been forming in the West and
South ever since the days of the Greenbackers and the "Ohio idea." It
recognized first that the money question was paramount to all others;
laid hard times at the door of the gold standard, which it denounced as
a British policy; and demanded the free coinage of both metals at the
existing legal ratio, under which sixteen parts of silver by weight
were declared equivalent to one part of gold in minting coins. Nor
would the party wait for the consent of any other nation. It opposed
the issuance of interest-bearing bonds in time of peace, condemned the
bond transactions of the Cleveland administration and denounced the
national bank-note system. The McKinley tariff was declared a prolific
breeder of trusts which enriched the few at the expense of the many.
The plank concerning the income tax, which had so recently been
declared unconstitutional by the Supreme Court, excited much
condemnation among Republicans and conservative Democrats, who
denounced it as an attack on the Court. It noted that the Court had
uniformly sustained income taxes for nearly a hundred years and
declared it to be the duty of Congress

    to use all the constitutional power which remains after that
    decision, or which may come from its reversal by the court as
    it may hereafter be constituted, so that the burdens of taxation
    may be equally and impartially laid, to the end that wealth may
    bear its due proportion of the expenses of the government.

The reaction of the party on the labor disputes of recent years and
especially the Pullman strike was clearly in evidence. Arbitration of
such controversies was called for; "interference" by federal
authorities in local affairs was condemned; government by injunction
was objected to; and the passage of such laws was demanded as would
protect all the interests of the laboring classes.

A minority of the platform committee now presented the opposing point
of view. It objected to many of the planks; complained that some were
ill-considered, others revolutionary; and offered two amendments,
one advocating the gold standard, the other expressing commendation
of Cleveland's administration. The contest was then on. Tillman
excoriated Cleveland and declared that the East held the West and
South in economic bondage; Hill denounced the currency, income tax and
Supreme Court planks as furiously as any Republican could have wished.
The currency plank, he thought, was unwise, that on the income tax
unnecessary, that on the Court assailed the supreme tribunal, and the
entire program was "revolutionary."

As yet, nobody had quite expressed the feelings of the convention.
Tillman was too crude; Hill had no remedy for long-standing ills. At
this juncture William J. Bryan stepped upon the platform. He was a
young man--only thirty-six years of age--and known but slightly as a
representative from Nebraska who possessed many of the arts and
abilities of an orator. Bryan began with a modest and tactful
declaration that his opposition to the gold wing of the party was
based solely on principles and not at all on personalities. The
convention had met, he insisted, not to debate but to register a
judgment already rendered by the people. Old leaders had been cast
aside because they had refused to express the desires of those whom
they aspired to lead. Briefly he outlined the reply of the radicals
to the objections made by Hill and the gold wing to the proposed
platform. The conservatives, Bryan declared, had complained that
free silver coinage would disturb business:

    We say to you that you have made the definition of a business man
    too limited in its application. The man who is employed for wages is
    as much a business man as his employer; the attorney in a country
    town is as much a business man as the corporation counsel in a great
    metropolis; the merchant at the cross-roads store is as much a
    business man as the merchant of New York; the farmer who goes forth
    in the morning and toils all day--who begins in the spring and toils
    all summer--and who by the application of brain and muscle to the
    natural resources of the country creates wealth, is as much a
    business man as the man who goes upon the board of trade and bets
    upon the price of grain; the miners who go down a thousand feet into
    the earth, or climb two thousand feet upon the cliffs, and bring
    forth from their hiding places the precious metals to be poured into
    the channels of trade are as much business men as the few financial
    magnates who, in a back room, corner the money of the world. We come
    to speak for this broader class of business men.

The time was at hand, Bryan insisted, when the currency issue must be
squarely met:

    We have petitioned, and our petitions have been scorned; we have
    entreated, and our entreaties have been disregarded; we have
    begged, and they have mocked when our calamity came. We beg no
    longer; we entreat no more; we petition no more. We defy them.

The radical wing of the Democracy had now found its orator. Every word
was driven straight to the hearts of the sympathetic hearers. The income
tax law had been constitutional, Bryan complained, until one of the
judges of the Supreme Court had changed his mind; the tariff was less
important than the currency because "protection has slain its thousands,
the gold standard has slain its tens of thousands." Fundamentally, he
insisted, the contest was between the idle holders of idle capital and
the struggling masses who produce the capital:

    If they come to meet us on that issue we can present the history of
    our nation. More than that; we can tell them that they will search
    the pages of history in vain to find a single instance where the
    common people of any land have ever declared themselves in favor of
    the gold standard. They can find where the holders of fixed
    investments have declared for a gold standard, but not where the
    masses have....

    You come to us and tell us that the great cities are in favor of the
    gold standard; we reply that the great cities rest upon our broad and
    fertile prairies. Burn down your cities and leave our farms, and your
    cities will spring up again as if by magic; but destroy our farms and
    the grass will grow in the streets of every city in the country....

    Having behind us the producing masses of this nation and the world,
    supported by the commercial interests, the laboring interests, and
    the toilers everywhere, we will answer their demand for a gold
    standard by saying to them: You shall not press down upon the brow
    of labor this crown of thorns, you shall not crucify mankind upon a
    cross of gold.

The frenzy of approval which this brief speech aroused was proof that
the West and South had found a herald. Whether wisely or not, the
radicals acclaimed their leader and the party was embarked upon a
program that made the campaign of 1896 a memorable one. Without further
ado, the amendments of the conservatives were voted down--the vote
being sectional, as before. Proposals that changes in the monetary
standard should not apply to existing contracts and that if free
coinage should not effect a parity between gold and silver at a ratio
of 16 to 1 within a year, it should be suspended, were both voted down
without so much as a division. The platform was then adopted by an
overwhelming majority and radical democracy had the bit in its teeth.
In the East the platform was viewed with amazement. The New York
_World_, a Democratic newspaper, expressed the opinion that the only
doubt about the election would be the size of McKinley's victory. The
Republican _Tribune_ thought that the party was afflicted with
"lunacy"; that it had become the "avowed champion of the right of
pillage, riot and trainwrecking"; that the platform was an anarchist
manifesto and a "call to every criminal seeking a chance for outrage."

Before Bryan's speech it had been impossible to foretell who the party
candidate for the presidency would be, although the veteran free silver
leader, Richard P. Bland, had been looked upon as a logical choice in
case his well-known principles should become those of the convention.
After the speech, however, it was clear that Bryan embodied the
feelings of many of his colleagues and on the fifth ballot he was
chosen as the candidate. The vice-presidential choice was Arthur
Sewall, of Maine, a shipbuilder and banker who believed in the free
coinage of silver.

The gold Democrats were now in a quandary. Many of them had refrained
from voting at all in the convention after the silver element had
gained control. Strict partisans, however, adopted the position of
Senator Hill who was asked after the convention whether he was a
Democrat still. "Yes," he is said to have retorted, "I am a Democrat
still--very still." Some frankly turned toward the Republican party,
while others organized the National Democratic party and adopted a
traditional Democratic platform, with a gold plank. After considering
the possibility of nominating President Cleveland for a third term, the
party chose John M. Palmer for the presidency and Simon B. Buckner for
the vice-presidency. Soon after the Democratic convention, the People's
party and the Silver party met in St. Louis. Both nominated Bryan for
the presidency, and thereafter the Democrats and the Populists made
common cause.

At the opening of the campaign, then, it was evident that class and
sectional hatreds would enter largely into the contest. The Populists
and the radical Democrats felt that they were fighting the battle of
the masses against "plutocracy"--the subtle and corrupting control of
public affairs by the possessors of great fortunes; they thought that
they saw arrayed against them the forces of wealth and the
corporations, seeking to enslave them. The conservative Democrats and
the gold Republicans saw in their opponents an organized attempt to
carry out a program of dishonesty and socialism. The one side believed
that the creditor class desired to scale debts upward; the other, that
the debtor class wished to scale them down. The radicals believed that
the Supreme Court was in the control of the wealthy; the conservatives,
that their opponents sought to assail the highest tribunal in the land.
The peculiar circumstances preceding the year 1896, however, focussed
attention on the monetary standard rather than upon the other demands
of the Populist-Democratic fusion.

Each candidate adopted a plan of campaign that was suited to his
individual situation. Bryan was relatively unknown and he therefore
decided to appeal directly to the people, where his powers as a speaker
would have great effect. The usual "notification" meeting was held in
Madison Square Garden, in New York City, so as to carry the cause into
the heart of "the enemy's country." During the few months of the
campaign the Democratic candidate travelled 18,000 miles, made 600
speeches and addressed nearly five million people. The effect was
immediate. The forces of social unrest, hitherto silent in great
measure, were becoming vocal and nobody could measure their extent.
McKinley had prophesied that thirty days after the Republican
convention nothing would be heard about the currency. When the thirty
days had passed, on the contrary, scarcely anything was heard except
that very question. Whatever his personal wishes, McKinley must meet
the problem face to face, and in alarm, Hanna and the Republican
campaign leaders put forth unparalleled efforts to save the party from
defeat.

The share of McKinley in these efforts was a novel one. Instead of
going upon the stump, he remained at his home in Canton, Ohio. A
constant stream of visiting delegations of supporters from all points
of the compass came to hear him speak from his front porch. Some of the
delegations came spontaneously; the visits of others were prearranged;
but in all cases the speeches delivered were looked over beforehand
with great care. The candidate memorized or read his own remarks and
carefully revised those which the spokesman of the visitors planned to
offer. In this way, any such untoward incident as the Burchard affair
was avoided and the accounts of the front-porch speeches which went out
through the press contained nothing which would injure the chances for
success. The effectiveness of the plan was attested on all sides.

In addition, extraordinary attempts were put forth to instruct the
people on various aspects of the currency question. A small army was
organized to distribute literature and address rallies; 120,000,000
documents were distributed from the Chicago and New York headquarters;
newspapers were supplied with especially prepared matter; posters and
buttons were scattered by the carload. At the dinner-table, on the
street corner, in the railroad train, in store, office and shop, the
people gave themselves over to a heated discussion of the merits of
gold and silver as currency and to the feasibility of free coinage at a
ratio of 16 to 1. The amount of money which these efforts required was
unusually large. Business men and banking institutions, especially in
New York, contributed liberally. The Standard Oil Company gave
$250,000; large life insurance companies helped freely, although the
fact was well concealed at the time. Business men were fearful that
Bryan's election would mean a great shrinkage in the value of their
properties. Many feared that the Democrats would assail the Supreme
Court and that their leader would surround himself with advisors of a
reckless and revolutionary character. Funds therefore poured into the
Republican war-chest to an amount estimated at three and a half million
dollars.

Before the close of the campaign a feeling akin to terror swept over
the East; contracts were made contingent upon the election of McKinley;
employees were paid on the Saturday night before election day and
notified that they need not return to work in the event of Democratic
success. Although caution and good manners characterized the utterances
of the two candidates, their supporters were hardly so restrained. The
following, for example, is typical of the editorial utterances of the
New York _Tribune_:

    Let us begin with the Ten Commandments. "Thou shalt not take the
    name of the Lord thy God in vain." The Bryan campaign from beginning
    to end has been marked with such a flood of blasphemy, of taking
    God's name in vain, as this country, at least, has never known
    before. "Thou shalt not steal." The very foundation of the Bryan
    platform is wholesale theft. "Thou shalt not bear false witness."
    In what day have Bryan and his followers failed to utter lies,
    libels and forgeries? "Thou shalt not covet." Why, almost every
    appeal made by Bryan, or for him, has been addressed directly to
    the covetousness, the envy, and all the unhallowed passions of
    human nature. A vote for Bryan is a vote for the abrogation of
    those four Commandments.

At the close of the campaign _The Nation_ sagely observed, "Probably no
man in civil life has succeeded in inspiring so much terror, without
taking life, as Bryan."

The result of the election was decisive. McKinley and a Republican
House of Representatives were elected, and the choice of a Republican
Senate assured. The successful candidate received seven million
votes--a half million more than his competitor. All the more densely
populated states, together with the large cities--where the greatest
accumulations of capital had taken place--were carried by the
Republicans. Not a state north of the Potomac-Ohio line and east of
the Mississippi was Democratic, and even Kentucky, by a narrow margin,
and West Virginia crowded their way into the Republican column. On
the other hand Bryan's hold on the South and West was almost equally
strong. Never before had any presidential candidate received so great a
vote and not for twenty years did a Democratic candidate surpass it.
Moreover, although the Democratic vote on the Atlantic seaboard was
less than that received by Cleveland in 1892, Bryan's support in the
Middle West showed considerable gains over the earlier year, while
Kansas, Nebraska and all the mining states except California were
carried by the silver cause. On the whole the election seemed to
indicate that the voters of the country, after unusual study of the
issues of the campaign, clearly distrusted the free-silver program, but
that class and sectional discontent had reached large proportions.

[Illustration:
The Presidential Election of 1896--the shaded states
gave Bryan pluralities]

The political results of the election of 1896 were important. It
definitely fixed the attitude of the Republican party on the currency
question; it gave the party control of the executive chair and of
Congress at an important time; and it ensured the domination of the
propertied classes and the _laissez faire_ philosophy in the party
organization. On the other hand, the Democratic party had incurred the
suspicion and hostility of the East, with hardly a compensating
increase of strength in the West; its principles had become radical for
that day and had abruptly changed from those of previous years; its
membership included more of the discontented classes than before; and
its leadership had been snatched from the hands of an experienced and
conservative leader and placed in the care of an untried radical. It
remained to be seen whether the victors would attempt to study and meet
the complaints of the farmer and the wage earner; whether the new
Republican leaders would be able to preserve the _laissez faire_
attitude toward the railroads and the corporations; and whether the
forces of dissent represented in Populism and radical Democracy had
received a death blow or only a rebuff.


BIBLIOGRAPHICAL NOTE

Peck contains one of the most illuminating accounts of the rising in
the West, together with the campaign of 1896. H. Croly, _Marcus A.
Hanna_ (1912), is one of the few critical biographies of leaders who
have lived since the Civil War. W.J. Bryan, _The First Battle_ (1897),
is indispensable; C.S. Olcott, _William McKinley_ (2 vols., 1916), is
uncritical and eulogistic, but makes important material available; C.A.
Beard, _Contemporary American History_ (1914), contains a good chapter;
W.H. Harvey, _Coin's Financial School_ (1894), is mentioned in the
text; Carl Becker's clever essay in _Turner Essays in American History_
(1910), throws light on Kansas psychology; S.J. Buck, _Agrarian
Crusade_ (1920), is excellent. Consult also D.R. Dewey, _National
Problems_ (1907); J.A. Woodburn, _Political Parties and Party Problems_
(1914); _Quarterly Journal of Economics_, X, 269; and F.E. Haynes,
_Third Party Movements_ (1916). The files of _The Nation_, and the New
York _Tribune_ and _Sun_ well portray eastern opinion. The references
to the rise of the populist movement under Chap. XII are also of
service.

       *       *       *       *       *

[1] I have drawn at this point upon Peck, _Twenty Years of the
Republic_, 453-456.

[2] Peck, 451-453.

[3] For brief accounts of Tillman, see Leupp, _National Miniatures_,
117; N.Y. _Times_, July 4, 1918; N.Y. _Evening Post_, July 3, 1918.

[4] Cf. Whitlock, _Forty Years of It_, 64 ff.; Altgeld, _Live
Questions_ and _The Cost of Something for Nothing_.

[5] In connection with the following pages, consult Croly, _Marcus A.
Hanna_, one of the few satisfactory biographies of this period.

[6] As finally adopted, the gold plank asserted: "We are unalterably
opposed to every measure calculated to debase our currency or impair
the credit of our country. We are, therefore, opposed to the free
coinage of silver, except by international agreement with the leading
commercial nations of the world, which we pledge ourselves to promote,
and until such agreement can be obtained the existing gold standard
must be preserved. All our silver and paper currency must be maintained
at parity with gold, and we favor all measures designed to maintain
inviolably the obligations of the United States and all our money,
whether coin or paper, at the present standard, the standard of the
most enlightened nations of the earth." Several leaders claimed to
have been the real author of the gold plank. It seems more nearly true
that many men came to the convention prepared to insist on a definite
statement and that each thought himself the originator of the party
policy.




CHAPTER XVII


REPUBLICAN DOMINATION AND WAR WITH SPAIN

The ceremonies attendant upon the inauguration of William McKinley on
March 4, 1897, were typical of the care-taking generalship of Mark
Hanna. The details of policing the crowds had been foreseen and
attended to; the usual military review was effectively carried out to
the last particular; "the Republican party was coming back to power as
the party of organization, of discipline, of unquestioning obedience to
leadership."[1]

The political capacity, the characteristics and the philosophy of the
new President were sufficiently representative of the forces which were
to control American affairs for the next few years to make them matters
of some interest. McKinley was a traditional politician in the better
sense of the word. As an executive he was patient, calm, modest, wary.
Ordinarily he committed himself to a project only after long
consideration, and with careful propriety he avoided entangling
political bargains. His engaging personality, his consummate tact and
his thorough knowledge of the temper and traditions of Congress enabled
him to lead that body, where Cleveland failed to drive it. As a speaker
he seldom rose above an ordinary plane, but he was simple and sincere.
His messages to Congress breathed an atmosphere of serenity and of
deferential reliance upon the wise and judicious action of the
legislative branch. Their smug and genial tone formed a sharp contrast
with his predecessor's anxious demands for multifarious reforms; while
Cleveland inveighed against narrow partisanship and selfish aims,
McKinley benignantly observed: "The public questions which now most
engross us are lifted far above either partisanship, prejudice, or
former sectional differences."

The political philosophy of McKinley typified that of his party. The
possibilities which he saw in protective tariffs, which occupied the
foremost position among his principles, were well set forth in his
message to Congress on March 15, 1897. Additional duties should be
levied on foreign importation, he asserted,

    to preserve the home market, so far as possible, to our own
    producers; to revive and increase manufactures; to relieve and
    encourage agriculture; to increase our domestic and foreign
    commerce; to aid and develop mining and building; and to render
    to labor in every field of useful occupation the liberal wages
    and adequate rewards to which skill and industry are justly
    entitled.

Like most American presidents, McKinley was a peace-lover, pleasantly
disposed toward the arbitration of international difficulties and
prepared to welcome any attempt to further that method of preserving
the peace of the world. His conception of the presidential office
differed somewhat sharply at several points from that of his
predecessor. Like Cleveland he looked upon himself as peculiarly the
representative of the people, but he was far less likely either to lead
public opinion or to attempt to hasten the people to adopt a position
which he had himself taken. This fact lay at the bottom of the
complaints of his critics that he always had his "ear to the ground" in
order that he might be prepared to go with the majority. On the other
hand, although he was aware of constitutional limitation upon the
functions of the executive, he was not so continually hampered by the
strict constructionist view of the powers of the federal government as
Cleveland had been. McKinley's attitude toward Congress was far more
sagacious than Cleveland's. He distributed the usual patronage with
skill; he approached Congressmen individually with the utmost tact; he
appointed them to serve on commissions and boards of arbitration, and
later, when matters upon which the commissions had been engaged came
before Congress in the form of treaties or legislation, these men found
themselves in a position to lead in the adoption of the principles
which the President desired. All this indicated an ability to "touch
elbows" with Congress that has rarely been exceeded. When coupled with
the organizing power of Hanna, the harmonizing sagacity of the
President soon brought about a notable degree of party solidarity. As a
political organization, the Republican party reached a climax.

McKinley was hardly an idealist, and distinctly not a reformer.
Although sensitive to pressure from the reform element, he was not
ahead of ordinary public opinion on matters of economic and political
betterment. Leaders in federal railroad regulation found the President
cold toward projects to strengthen the Interstate Commerce law; the
Sherman Anti-trust Act was scarcely enforced at all during McKinley's
administration, and the parts of his messages which relate to the
regulation of industry are vague and lacking in purpose. One searches
these documents in vain for any indication that the Republican leader
had either vigorous sympathy with the economic and social unrest which
had made the year 1896 so momentous or even any thorough understanding
of it. Even if he had possessed both sympathy and understanding,
however, it is doubtful whether he could have made real progress in the
direction of economic legislation and the enforcement of the acts
regulating railroads and industry, in view of his long-continued and
close affiliation with business leaders of the Mark Hanna type and his
deep obligation to them at the time of his financial embarrassments in
1893.

McKinley's cabinet was composed of men whose advanced age and
conservative characteristics indicated that his advisers would commend
themselves to the business world and would instinctively avoid all
those radical proposals that were coming to be known as "Bryanism." The
dean of the cabinet in age and experience as well as in reputation and
ability was John Sherman, who was now almost seventy-four years of age
and had been occupying a position of dignity and honor in the Senate.
Two reasons have been given for his appointment to the post of
Secretary of State. In the first place, important diplomatic affairs
were on hand, in the settlement of which his long experience as a
member of the Senate Committee on Foreign Relations would be of obvious
advantage. The second reason was the ambition of Hanna to enter the
Senate. Since Sherman and Hanna were both from Ohio, it was possible to
call the former to the cabinet and rely upon the Governor of the state
to appoint the latter to the Senate. The propriety of this course of
action depended somewhat on the question of Sherman's physical
condition. Rumor declared that he was suffering from mental decay, due
to his age, but McKinley believed the rumor to be baseless, summoned
him to the cabinet, and Hanna was subsequently appointed to the Senate.
When Sherman took up the duties of his office it appeared that the
rumor had been all too true, and a serious lapse of memory on his part
in a diplomatic matter forced his immediate replacement by William R.
Day. Somewhat more than a year later Day retired and John Hay assumed
the position. Many critics have asserted that McKinley was aware of the
precise condition of Sherman and that he made the choice despite this
knowledge, but it now seems likely that he was guilty only of bad
judgment and carelessness in failing to inform himself about Sherman's
infirmities. Another error of judgment was made in the choice of
Russell A. Alger as Secretary of War. Alger failed to convince popular
opinion that he was an effective officer and he resigned in 1899. As in
the case of Sherman, McKinley then somewhat retrieved his mistake by
appointing a successor of undoubted ability, in the person of Elihu
Root.[2] It thus came about that the political and economic theories
which had been characteristic of the leaders of both parties during the
seventies and eighties, but more particularly of the Republican party,
were again in the ascendancy. The President and his cabinet were
uniformly men who had grown up during the heyday of _laissez faire_,
and Hanna, who would inevitably be regarded as the mouthpiece of the
administration in the Senate, was the embodiment of that philosophy.

McKinley's experience with the distribution of the offices emphasized
the progress that had been made since civil service reform had been
inaugurated. One of the steps which President Cleveland had taken
during his last administration, it will be remembered, was to increase
the number of positions under control of the Civil Service Commission.
The immediate result, of course, was to increase the demand for places
in the unclassified service. John Hay picturesquely described the
situation in the State Department a few years later:

    All other branches of the Civil Service are so rigidly provided
    for that the foreign service is like the topmost rock which you
    sometimes see in old pictures of the Deluge. The pressure for a
    place in it is almost indescribable.

Both in his inaugural address and in his message to Congress on
December 6, 1897, McKinley expressed his approval of the prevailing
system, but suggested the possibility of exempting some positions then
in the classified service. President Cleveland had, indeed, admitted
to the Civil Service Commission that a few modifications might be
necessary. The Senate promptly ordered an investigation and discovered
10,000 places which it believed could be withdrawn, but because of
other events further action was delayed. In 1899 the President returned
to the subject and promulgated an order authorizing the withdrawal of
certain positions from competitive examination and the transfer of
others from the Commission to the Secretary of War--a total of somewhat
less than 5,000 changes.[3] It appeared, in view of the circumstances
under which the change had occurred, that a retrograde step had been
taken, and McKinley received the condemnation of the reformers.

The first legislation undertaken by the administration was that
relating to the tariff. The election of 1896, to be sure, had been
fought out on the silver issue, but it was not deemed feasible to
proceed at once to legislation on the subject, because of the strong
silver contingent within the party. Several other considerations
combined to draw attention away from the currency question and toward
the tariff. The Wilson-Gorman Act of 1894 had been passed under
circumstances that had caused the Democratic President himself to
express his shame and disappointment; the period of industrial
depression following the panic of 1893 had been attributed so widely to
Democratic tariff legislation that a Republican tariff act could be
hailed as a harbinger of prosperity; and the annual deficit which had
continued since 1893 indicated a genuine need of greater revenue, if
the current scale of expenditures was to be continued. The President
and the party leaders in Congress were men who were prominently
identified with the protective system, and it was not likely that the
business interests which profited from protection, which believed in
its beneficent operation, and which had contributed generously to the
Republican war-chest would remain inactive in the presence of an
opportunity to revise the tariff.

Immediately after his succession to office, therefore, McKinley called
a special session of Congress to legislate upon the chosen subject. His
message urged an increase in revenue to be brought about by high import
duties which, he suggested, should be so levied as to be advantageous
to commerce, manufacturing, agriculture, mining, building and labor.
The projected bill was already in hand. Republican success in the
election had insured the return of Thomas B. Reed to the speaker's
chair and Nelson Dingley to the Committee on Ways and Means. The latter
was as devoted to the high-tariff cause as the Speaker and the
President, and had laboriously constructed a bill which was distinctly
protective. The legislative history of the Tariff Act of 1897--more
commonly known as the Dingley act--was in several respects much like
that of similar measures of earlier years. Its passage through the
House was expedited by the masterful personality and vigorous tactics
of the Speaker--a process which consumed less than a fortnight. In the
Senate, bargain and delay ruled procedure; a few of the silver
Republicans held the balance of power and demanded a _quid pro quo_ for
their support; and the Secretary of the Wool Manufacturers' Association
preserved a suggestively close connection with the Finance Committee
which had charge of the bill. After amending the House draft in 872
particulars, the Senate entrusted its interests to the usual conference
committee, and there, as had happened before, the rates were in many
cases raised above those desired by either the Senate or the House. The
bill became law in July, 1897.

The Dingley act added little to the settlement of the tariff problem.
The ordinary consumer was as little able as before to present his
demands effectively and at the time and place at which the rates were
really determined. The requirements of the silver Republicans were met
by the imposition of high duties on wool. For one reason or another,
duties were restored or raised upon hides, silks and linens, although
those on cotton goods were slightly lowered. The duty on sugar was
retained at a point favorable to the trust. In brief, then, the Act of
1897 was aggressively protectionist. An abortive section of the act
empowered the President to conclude treaties providing for reductions,
as great as twenty per cent., in return for commercial concessions from
other countries. Such reciprocity arrangements, however, must be made
within two years of the passage of the law and might not remain in
force more than five years, and each treaty must be ratified by the
Senate. The President was favorable to reciprocal adjustments and
several were arranged but were uniformly rejected in the Senate.

Business was prosperous after the enactment of the Dingley tariff and
little agitation for a change was observable for a decade. Prosperity,
being world wide, was doubtless not due in its entirety to the American
tariff, yet the coincidence of protection and good times gave the
Dingley act a pleasant reputation. For many years enthusiastic stump
speakers placed the beneficence of Providence and the tariff of 1897 on
an equality as causes of American well-being.

The President's first message to Congress had extended congratulations
upon the fact that peace and good will with all the nations of the
earth continued unbroken. Nevertheless it was necessary for him to
devote much attention to the relations between Spain and its most
valuable American possession--the island of Cuba.

American interest in Cuba was by no means of recent growth. The
situation of the island--dominating the narrowest point of the waterway
between the Atlantic seaboard and the Gulf of Mexico--insured the
importance of Cuba as a strategic position. The traditional attitude of
Spain toward her colony had been one of exploitation, a policy which
was sure to be looked upon with suspicion by a nation which had itself
revolted from oppression. Riots and rebellions in the island, having
their origin in Spain's colonial policy, had long engaged American
sympathy and attention. American statesmen--Jefferson, John Quincy
Adams, Clay and Webster--had pondered upon the wisest and most
advantageous disposition of Cuba. In 1859 the Senate Committee on
Foreign Relations had even concluded that "The ultimate acquisition of
Cuba may be considered a fixed purpose of the United States." From 1868
to 1878 the "Ten Years' War" between Cuba and Spain had raised American
feeling to a high pitch. The struggle was characterized by a barbarity
that rivalled mediaeval warfare; islanders who escaped to the United
States sent ships to Cuba laden with arms and men; American trade
rights were interfered with and American citizens seized by the
Spaniards and shot; the _Virginius_ was captured--a ship carrying the
American flag--and many of her crew were executed. Indignation meetings
were held, the navy was put in order and war was in sight. Cautious
diplomatic negotiations delayed hostilities, however, and subsequently
exhaustion caused the restoration of peace between Spain and her
distracted colony.

With the recurrence of insurrection in 1895, interest in the United
States was renewed, and this time circumstances combined to bring about
a climax in American relations with Spain. On both sides the contest
between Spain and her colony was carried on with unutterable cruelty.
The island leader, Maximo Gomez, conducted guerrilla warfare,
devastating the country, destroying plantation buildings and forcing
laborers to cease work, in order to exhaust the enemy or to bring about
American intervention. Spanish procedure was even more barbaric. A
"reconcentration" order, promulgated by Valeriano Weyler,
Governor-general of the island and General-in-chief of the army,
compelled the rural population to herd together in the garrisoned
towns. Their buildings were then burned and their cattle driven away or
killed; hygienic precautions were disregarded and the people themselves
were insufficiently clothed and fed. The extermination of the
inhabitants proceeded so rapidly as to promise complete devastation in
a short time.

President Cleveland had been deeply affected by the Cuban situation.
His last annual message to Congress had noted the $30,000,000 to
$50,000,000 of American capital invested in the island, the volume of
trade amounting yearly to $100,000,000, the use of American soil by
Cubans and Cuban sympathizers for raising funds and purchasing
equipment, and the stream of claims for damages done to American
property in Cuba. In spite of his well-known disinclination to share in
the internal affairs of other peoples, he had voiced a suggestive
warning that American patience could not be maintained indefinitely.

The succession of McKinley seemed likely to result in a change in the
attitude of America toward the Cuban problem. He was more responsive to
public opinion than his predecessor had been, public opinion was more
and more coming to favor intervention, and his party had committed
itself in its platform to Cuban independence through American action.
Moreover, two events early in 1898 greatly irritated the United States.

On February 9 a New York newspaper published a letter written by Señor
Enríque Dupuy de Lôme, Spanish minister to the United States, to a
personal friend in Havana. It referred to President McKinley as a
"would-be politician who tries to leave a door open behind himself
while keeping on good terms with the jingoes of his party." It further
revealed the intention of the Minister to carry on a propaganda among
senators in the interest of a commercial treaty. On all sides it was
seen that the usefulness of Señor de Lôme was at an end and his
government immediately recalled him. On February 15 the whole world was
shocked by the destruction of the United States battleship _Maine_ in
Havana harbor, with the loss of 260 officers and men. News of the
disaster was accompanied by the appeal of Captain Sigsby, commander of
the vessel, that popular judgment of the causes of the disaster be
suspended until a court of inquiry could investigate and report.
Nevertheless on March 9, Congress placed $50,000,000 at the President's
disposal for the purposes of national defence and the navy prepared for
a conflict that seemed inevitable. Both the Spanish and American
authorities conducted examinations. The American court reported that
the ship had been destroyed by the explosion of a submarine mine, which
had caused the partial explosion of two or more of her magazines. No
evidence could be found which would fix the responsibility on any
individual. The Spanish court came to the conclusion that the
catastrophe was due solely to an explosion of the ship's magazines.
American opinion naturally supported the findings of the American
court, and feeling ran high; newspapers demanded war; "Remember the
_Maine_" summarized much of popular discussion.[4]

Under such circumstances, diplomatic negotiations looking toward peace
were difficult, and resulted only in disagreements and delay.
Accordingly on April 11 the President laid before Congress a succinct
account of Cuban affairs and earnestly called for forcible
intervention. The grounds for this action he found in the sufferings of
the people of Cuba, the injuries to Americans and to American property
and trade, and the menace to American peace which was entailed by
continuous conflict at our very threshold.[5] The transfer of the Cuban
question from the hands of the President to those of Congress was
equivalent to a decision in favor of war. On April 19 the Senate and
House resolved that the people of Cuba were and ought to be
independent, demanded that Spain withdraw from the island and directed
the President to use the force of the nation to achieve the results
desired. The approval of the Executive on the following day completed
the severance of peaceful relations with Spain. At daylight on April 22
Admiral Sampson and his fleet were crossing the narrows between Florida
and Cuba, on the way to establish a blockade of the greater part of the
island. Within three days more, Commodore George Dewey, who was in
command of a fleet at Hong-Kong, had been instructed to proceed at once
to the Philippine Islands and capture or destroy the Spanish fleet
there. On April 25 Congress formally declared war upon the kingdom of
Spain.

It was not by mere chance, of course, that Admiral Sampson and
Commodore Dewey were prepared to act with such celerity. Authorities in
the Navy Department had long felt that a collision with Spain was
inevitable and had been preparing for such an eventuality. With as
little publicity as possible the Department completed and commissioned
ships that were already under construction; it hastened the repair of
vessels which were in any way defective; it ordered target practice and
fleet manoeuvres; and it prepared plans for the conduct of a naval war.
Commanders of squadrons were instructed to keep in service men whose
terms of enlistment were about to expire; supplies of ammunition were
procured and shipped to points where they would be needed; the
_Oregon_, which had been stationed on the Pacific coast, was ordered to
return to Key West by way of the Straits of Magellan and so began a
voyage whose closing days were watched with interest by a whole nation.
A Northern Patrol Squadron was organized to guard New England; a Flying
Squadron was assembled at Hampton Roads for service on the Atlantic
coast or abroad; and a formidable array gathered at Key West under
Rear-Admiral Sampson for duty in the West Indies. Foreign shipyards
were scoured for vessels in process of building and several were
purchased, completed and renamed for American service. Greater
additions were made through the purchase of merchantmen and their
transformation into auxiliary cruisers, gunboats and colliers. In these
ways the attempt was made, with some success, to improvise a navy on
the eve of war.

The people of the country had scarcely become accustomed to the thought
that war with Spain had actually come to pass when word was received in
Washington of the exploit of Commodore Dewey in the Philippine Islands.
Attention for the moment was focussed on the Far East, and the press
dilated upon the first test of the new American Navy.

The story of the test proved to have points of interest and importance.
When Commodore Dewey received the orders already mentioned, on April
25, he finished immediately the preparations for conflict which had
been initiated and turned his flagship, the _Olympia_, in the direction
of Manila. His available force consisted of four protected cruisers,
two gunboats, a revenue cutter, a collier and a supply ship. The city
of Manila is on Manila Bay, a body of water twenty miles or more wide,
and is reached only through a narrow entrance. Dewey judged that the
channel was too deep to be mined successfully except by trained experts
and that both contact and electrical mines would deteriorate so rapidly
in tropical waters as to be effective only for a short time. He
therefore decided to steam through the channel at night, disregarding
the mines, and to attack the Spanish fleet which lay within. The plans
worked out even better than he had hoped. With all lights masked and
the crews at the guns, the squadron moved silently through the passage
with no other opposition than three shots from a single battery. Once
within the Bay Dewey steamed slowly toward the city of Manila and then
back to a fortified point, Cavite, where he found his quarry arranged
in an irregular crescent and awaiting the conflict. Oblivious of the
hasty and inaccurate fire from the batteries on shore, he deliberately
moved to a position within two and a half miles of the Spanish ships
and said to the Captain of the _Olympia_, "You may fire when you are
ready, Gridley."

[Illustration:
The Philippines]

Three times westward and twice eastward the American squadron ran
slowly back and forth, using the port and starboard batteries in turn,
and in a short time the shore batteries and the Spanish fleet were
masses of ruins. Of the American forces, only eight were injured, and
they only slightly, while 167 of the Spanish were killed and 214
wounded. News of the victory was as unexpected as it was welcome in the
United States. President McKinley appointed Dewey an acting
Rear-Admiral and on all sides discussion began of the situation and
possibilities of the Philippines.

In the meantime, the position of the American squadron was far from
secure. To be sure, all resistance from the batteries in and around
Manila was quickly suppressed by a threat to destroy the city;
nevertheless Admiral Dewey was in command of too slight a force to
enable him to occupy both the town and its environs. He accordingly
notified Washington that more troops were necessary if it were intended
to seize and retain Manila, and expeditionary forces were despatched,
the first of which arrived on June 30. Indeed it was high time that
assistance be forthcoming, for new possibilities of conflict had
appeared in the presence of a powerful force of German warships.

As soon as the defeat of the Spanish squadron had been effected,
Admiral Dewey established a blockade of Manila Bay and, according to
custom, the war vessels of interested nations went thither to observe
the effectiveness of the blockade and to care for the well-being of
their nationals. Among the early arrivals were the British, the French
and the Japanese, all of whom observed the formalities of the situation
and reported to the American Admiral before venturing into the harbor.
The Germans, however, omitted the proprieties until sharply reminded by
a shot across the bow of the _Cormoran_. By mid-June five German
men-of-war under command of Vice Admiral von Diedrichs were in the
Bay--a force nearly if not quite the match of the American squadron.
When the Germans continued their disregard of the regulations
controlling the blockade, indicating a potential if not an actual
hostility, it became necessary for Admiral Dewey to have done with the
Teutonic peril at once. He sent a verbal message to von Diedrichs which
effectually ended all controversy. Admiral Dewey has not disclosed the
exact phraseology of the message, nor did he send a record of it to the
Navy Department. A newspaper correspondent who was acting as one of the
Admiral's aides asserted that the protest was against von Diedrich's
disregard of the usual courtesies of naval intercourse and that it
closed with the words, "if he wants a fight he can have it right now."
The disclosure by Captain Edward Chichester, in command of the English
force, that he had orders to comply with Admiral Dewey's restrictions
and that his sympathies were with the Americans, together with the
arrival of the expeditionary force, assured American supremacy and a
peaceful blockade. On August 13 a joint movement of the naval forces
and the infantry under General Wesley Merritt resulted in the speedy
surrender of the city of Manila. The Americans were now in control of
the capital of the Philippine Islands and would, perforce, face the
question of the ultimate disposition of the archipelago in case of the
eventual defeat of Spain. In the meanwhile, popular attention turned
toward stirring events which were taking place in the Caribbean Sea.

On April 28--a week after Admiral Sampson started for Cuba--the Spanish
Admiral Cervera left the Cape Verde Islands. His force was a
considerable one; his goal was unknown, although naturally believed to
be some point in the Spanish West Indies. On the assumption that this
hypothesis was a correct one, Sampson patrolled the northern coast of
Cuba, extending his movement as far as Porto Rico, and scouts were
placed out beyond Guadeloupe and Martinique. The entire nation
anxiously awaited the outcome of the impending encounter.

[Illustration:
The Spanish-American War in the West Indies]

On May 19 Cervera slipped into Santiago, a town on the eastern end of
Cuba which had rail connection with Havana, the capital of the island.
Commodore W.S. Schley who was in command of a squadron on the southern
coast soon received information of the enemy's whereabouts and
established a blockade of the city, while Sampson hastened to the scene
and assumed command of operations. The American force now included four
first-class battleships, one second-class battleship and two cruisers.
They were arranged in semi-circular formation facing the harbor, and at
night powerful search-lights were kept directed upon the channel which
Admiral Cervera must take in case of an attempt to escape. The main
part of Santiago Bay is between four and five miles long and is reached
through a narrow entrance channel. Elevated positions at the mouth of
the channel rendered the vigorous defence of the harbor a matter of
some ease. Early in the progress of the blockade the Americans
attempted to sink a collier across the entrance, but fortunately, as it
turned out, this daring project failed, and Admiral Sampson settled
down to await developments.

It was apparent that the capture of Santiago, and the destruction of
the fleet could be brought about only through a joint movement of the
army and navy. Hitherto the war had been entirely on the sea.
Nevertheless over 200,000 volunteers had been called for, in addition
to somewhat over 50,000 regular troops and the "Rough Riders"--the last
a regiment of volunteer cavalry which had been raised by Colonel
Leonard Wood and Theodore Roosevelt and which was largely composed of
cowboys, ranchmen, Indians and athletes from eastern colleges. The
regulars, together with a few volunteers and the Rough Riders, were
sent to Tampa, Florida, while most of the volunteers were trained at
Chicamauga Park, in Georgia. It had been expected that the important
military operations would take place around Havana and for that reason
the officer commanding the army, General Nelson A. Miles, with most of
the regular troops, were retained for the larger service. The command
of the expedition to Santiago fell to General William E. Shafter.
Sixteen thousand eight hundred and eighty-seven officers and men set
sail from Tampa on June 14 and began to disembark eight days later at
Daiquiri, sixteen miles to the east of Santiago.

Advancing from this point General Lawton, commanding a division of
infantry, moved parallel to the shore and seized Siboney. General
Wheeler, a former Confederate who was now in command of the cavalry,
met and defeated a Spanish force at Las Guasimas. Further advance met
difficulties that were more serious. On the left of the American line
was San Juan Hill, an eminence which commanded the country toward the
east; on the right was El Caney, a fortified village held by a small
force of Spaniards. The country between the two points was a jungle,
the roads hardly better than trails, where troops frequently had to
go in single file. The fight at El Caney was severe, the enemy being
well-entrenched, well-armed and protected by wire entanglements and
block houses, and General Lawton suffered a loss of more than 400
killed and wounded before driving the Spaniards out of their position.
San Juan Hill was still more stubbornly defended, and an American
advance was impeded by the heat, the tropical growth and the uneven
character of the country. Under these circumstances officers became
separated from their men and victory was gained through the
determination and resourcefulness of the individual. The Spaniards then
fell back upon Santiago.

[Illustration:
Campaign about Santiago]

The continued success of the Americans compelled the Spanish
authorities to make an immediate decision in regard to the fleet. To
remain in the harbor seemed to mean being encircled and starved; to go
out through the narrow channel seemed to lead to sure destruction. Yet
the latter venture appealed to the commander-in-chief of Cuba,
Captain-General Blanco, as the more honorable one and on July 2 orders
were sent to Admiral Cervera to make the attempt. Early next morning,
while Admiral Sampson was away at a conference with General Shafter,
lookouts on the American battleships descried the _Infanta Maria
Teresa_ feeling her way out of the harbor, followed by the remainder
of the Spanish fleet, three armored cruisers and two torpedo-boat
destroyers. The Americans instantly closed in, directing their fire
first against the _Teresa_ and later against the rest of the fleet as
they tried to follow their leader out to safety. Once out of the harbor
the entire Spanish fleet dashed headlong toward the west, parallel to
the coast, while the Americans kept pace, pouring a gruelling fire from
every available gun. The Spaniards returned the fire and thus "the
action resolved itself into a series of magnificent duels between
powerful ironclads." One by one the enemy's vessels were sunk or forced
to run ashore--the _Cristobal Colon_ last, at two o'clock in the
afternoon. The Spanish losses, besides the fleet, were 323 killed and
151 wounded; the Americans lost one killed and one wounded. The city of
Santiago, deprived of its fleet, found itself in a desperate plight and
surrendered on July 16. Shortly afterwards General Miles led an
expedition into Porto Rico, but operations were soon brought to a close
because of the suspension of hostilities, and from a military point of
view the importance of the campaign was negligible.

The succession of overwhelming defeats drove home to Spain the futility
of further conflict. The despatch of American troops to the Philippines
and to Porto Rico, moreover, indicated that Spain would soon suffer
other losses. Hence the Spanish government, acting through Jules
Cambon, the French ambassador to the United States, sought terms for
the settlement of the war. The President's reply of July 30 made the
following stipulations: Spain to relinquish and evacuate Cuba and to
cede Porto Rico and one of the Ladrone Islands; the United States to
occupy the city and bay of Manila, pending the conclusion of peace and
the determination of the final disposition of the Philippines. Spain
wished to restrict negotiations to the Cuban question, but was forced
to accept the conditions laid down by the victor. A preliminary
agreement or protocol was therefore signed, which provided for a
conference at Paris concerning peace terms.

The uniform success of the American arms could not obscure the popular
belief that the Department of War had been guilty of many shortcomings.
It will doubtless be always a subject for dispute as to whether the
major portion of the blame is to be laid at the door of the traditional
American disinclination to be prepared for warfare, or upon Secretary
Alger and his immediate advisors. That the conduct of the military
affairs was inexpert, however, is admitted on all sides. The facilities
for taking care of the troops at Tampa were inadequate. When transports
reached Tampa to take the troops to Santiago, officers wildly scrambled
to get their men on board. The Rough Riders, for example, made their
way into a transport intended for two other regiments, one of regulars
and the other of volunteers, with the result that the volunteers and
half of the regulars were left on shore. The clothing supplied for the
Cuban campaign was better suited to a cold climate than to summer in
the tropics. The health of the troops during the Santiago campaign was
such that the general officers expressed the opinion that the army must
immediately be removed from Cuba or suffer severe and unnecessary
losses from malarial fever. When the men were removed, however, they
were taken to Montauk Point on Long Island, where the climate was too
cool and bracing. Unsanitary conditions in the training camps within
the borders of the United States were the cause of fatalities estimated
at several times the number killed in battle. A controversy over the
quality of the beef supplied to the troops led to an executive
commission of investigation. Both unnecessary and unfortunate was the
Sampson-Schley controversy, which originated in a difference of opinion
about the proportion of credit which each of these officers should have
for the success of Santiago and which was continued in charges that the
latter had made serious mistakes in the conduct of his share of the
operations. Subsequently a Court of Inquiry investigated the
accusations and made a decision which did not completely satisfy either
side.

Despite these minor mistakes, however, the war increased the strength
of the administration. The most lasting effects of the conflict on
constitutional and political history demand detailed discussion at a
later point, but the immediate results can be briefly stated.[6] The
successful prosecution of a popular war, combined with widespread
prosperity and the demoralization of the opposition party greatly
heightened the prestige of the Republicans. McKinley appeared to have
been in truth, the "advance agent of prosperity"; and his party
obtained a dominating control of public policy.


BIBLIOGRAPHICAL NOTE

H. Croly, _Marcus A. Hanna_ (1912), and C.S. Olcott, _William McKinley_
(2 vols., 1916), discuss the politics of the period, subject to the
limitations already mentioned. W.D. Foulke, _Fighting the Spoilsman_
(1919), describes the relation of the administration to the civil
service; for the Dingley tariff, Stanwood, Tarbell and Taussig.

The literature on the Spanish war is extensive. Most detailed and
reliable is F.E. Chadwick, _Relations of the United States and Spain_;
I, _Diplomacy_, II, III, _The Spanish War_ (1909, 1911). J.H. Latané,
_America as a World Power_ (1907), has several good chapters; H.E.
Flack, _Spanish-American Diplomatic Relations Preceding the War of
1898_ (1906), and E.J. Benton, _International Law and Diplomacy of the
Spanish-American War_ (1908), take up the diplomatic side. On naval
preparations, J.D. Long, _New American Navy_ (2 vols., 1903), is by
McKinley's Secretary of the Navy; see also E.S. Maclay, _History of
the United States Navy_ (rev. ed., 3 vols., 1901-1902). Good
autobiographical accounts are: C.E. Clark, _My Fifty Years in the Navy_
(1917); George Dewey, _Autobiography_ (1913); Theodore Roosevelt,
_Autobiography_; and W.S. Schley, _Forty-five Years under the Flag_
(1914). See also A.T. Mahan, _Lessons of the War with Spain_ (1899).

       *       *       *       *       *

[1] Cf. Peck, 518.

[2] Other members of the cabinet were: Lyman J. Gage, Ill., Secretary
of the Treasury; Joseph McKenna, Calif., Attorney-General; J.A. Gary,
Md., Postmaster-General; J.D. Long, Mass., Secretary of the Navy, C.N.
Bliss, Secretary of the Interior; James Wilson, Ia., Secretary of
Agriculture.

[3] The National Civil Service Reform League estimated the changes at
10,000.

[4] In 1911 the wreck of the _Maine_ was raised and examined. The
evidence found was such as to substantiate the findings of the American
court of inquiry. _Scientific American_, January 27, 1912.

[5] It has commonly been felt among certain classes in the United
States since 1898 that the business interests whose property and trade
were mentioned by President McKinley had an undue share in bringing
about the declaration of war. While it can not be doubted that the
President was swayed more by business interests than most of our
executives since the Civil War have been, yet it is also true that the
sufferings of the Cubans aroused genuine sympathy in the United States.
The President himself was anxious to delay war as long as possible.

[6] Below, Chap. XVIII.




CHAPTER XVIII


IMPERIALISM

"The guns of Admiral Dewey did something more than destroy a Spanish
fleet in the harbor of Manila. Their echo came back to us in a
question new in the history of our government." The new problem was
Imperialism--was it wise policy and was it constitutional to annex and
govern territories outside the limits of continental North America? In
colonial problems the United States had had no experience; and if the
Philippines, Cuba or Porto Rico were annexed, it would be necessary
to administer the affairs of peoples whose languages, racial
characteristics and forms of government were utterly strange. Such
objections arose in the minds of many Americans as the conference
assembled at Paris on October 1 to settle the terms of peace.[1]

The chief controversies between the Spanish and the American negotiators
related to Cuba and the Philippines. The Spanish commissioners early
proposed to transfer Cuba to the United States, the latter to turn it
over to the Cuban people in due time. With the sovereignty of Cuba was
to go the debt of the island. On the refusal of the Americans to accede
to this, the Spanish commissioners urged the transfer of Cuba to the
United States without any promise as to its future. Instructions from
Washington both on possession and on debt, however, were explicit and
in the end Spain had to relinquish all claim to Cuba and assume
responsibility for its indebtedness. The proper disposition of the
Philippines presented far greater difficulty. Not only was there a
difference of opinion between the two groups of commissioners, but the
American government was in doubt about the wisest course to pursue, and
grave diversity of opinion existed among the people and in the peace
commission itself. Moreover the capture of the city of Manila had taken
place after the protocol had been signed and after hostilities had been
ordered suspended, but before news of these facts had reached Admiral
Dewey. The original instructions of President McKinley to the peace
commissioners were to the effect that the outcome of the war had placed
new duties and responsibilities on the United States, that the
commercial opportunity which possession of the Philippines would present
could not be overlooked and that the island of Luzon at least must be
ceded. So little was known about the people and the possibilities of the
islands that the American commission was compelled to go far afield to
obtain information from writers and investigators in regard to questions
of defence, the political capacity of the inhabitants, the danger that
another nation might step in if the United States should evacuate,
commercial prospects, and so on. President McKinley soon came to the
opinion that the proper course was to take the entire archipelago. To
give them back to Spain seemed "dishonorable"; to turn them over to our
commercial rivals, France or Germany, seemed "bad business"; to leave
them to themselves would be to leave them to "anarchy and misrule";
hence there was nothing to do but to take all of them and attempt to
spread American civilization among the Filipino people. The American
commissioners therefore demanded the Philippines, but realizing the
defect in their case, since the conquest of Manila had taken place after
the conclusion of the protocol, agreed to pay Spain $20,000,000. The
Spanish commissioners thereupon yielded to necessity and reluctantly
agreed.

As finally signed, the treaty of December 10, 1898, contained the
following points: Spain agreed to relinquish Cuba, and the United
States was to protect life and property during its occupancy of the
island; Spain also ceded Porto Rico and the other Spanish West Indies,
Guam in the Ladrones, and the Philippines on payment of $20,000,000;
the United States agreed to return to Spain, at its own cost, all
Spanish prisoners taken at the time of the capture of Manila; the
civil and political rights of the inhabitants of the ceded territories
were to be determined by Congress; and freedom of religion was
guaranteed.

The reference of the treaty to the Senate for ratification elicited
many divergences of opinion, the ablest opposition being presented by
members of the President's own party. In particular, the position
taken by Senator Hoar, a rigid Republican and a close friend of
President McKinley, made a strong impression. That there can be no
just government without the consent of the governed, he asserted, was
the central doctrine of the Declaration of Independence. Moreover, the
acquisition of foreign lands, he believed, would lead us into
competition with European powers for territory, and thus tempt us away
from the international policy which had been laid down by the
"fathers" and followed by the nation ever since. Most of the Democrats
held similar views, but some of them heeded the advice of Bryan, who
urged that the treaty be ratified in order to end the war, and that
the ultimate disposition of the new possessions be decided in the next
presidential campaign. The point of view which seems to have prevailed
with most Republicans was that the United States, being a sovereign
nation, possessed power to acquire territory and to determine its
future status, and that as a matter of expediency it was better to
take the Philippines than to risk the dangers which lay in leaving
them alone. Shortly before the final vote was taken, an insurrection
broke out in the Philippines against American control, which may have
influenced some senators to accept the President's settlement. Even
with this aid, however, ratification was brought about by the narrow
margin of one vote more than the required two-thirds majority.[2]

Within the field of politics, the Republicans increased the advantage
which they had gained in 1896. The congressional and state elections
of 1893 continued their control of the House and strengthened it in
the Senate; the world-wide prosperity which has already been mentioned
and in which the United States shared, was in striking contrast with
the business depression of the recent Democratic administration;
discoveries of gold deposits in the Klondike and the improvement of
methods of extracting the metal from the ore greatly increased the
currency supply and assisted in raising the level of prices, thereby
giving greater prosperity to the western farmer and lessening his
complaints. The gold standard act of March 14, 1900, pleased the
financial interests, for it fixed the standard of value, set the
amount of the gold reserve at $150,000,000, and specified adequate
means by which the Secretary of the Treasury could maintain other
forms of money on a parity with the precious metal. Within the
Republican organization, the President's soothing personality and
Hanna's meticulous attention to the details of the party machinery
continued undiminished the momentum which had been gathered.
Defections on the imperialism issue, while affecting important party
leaders, were numerically unimportant. Among the financial and
industrial classes, therefore, confidence in President McKinley and
his advisors was thoroughgoing. There was a strong bond of interest,
moreover, between territorial expansion and industrial expansion,
between Imperialism and the expansion of foreign markets. The primacy
of business was assured.

The renomination of McKinley at the Republican Convention in
Philadelphia, on June 19, 1900, was unanimous. The vice-presidency,
contrary to tradition, occupied the center of interest. Several men of
prominence were mentioned in this connection but the name which evoked
most enthusiasm was that of Theodore Roosevelt. Roosevelt's career
during the war with Spain had been a prominent factor in making him
Governor of New York. As Governor he had shown energy and independence,
especially in connection with measures for taxing street railway and
other franchises, and had come into conflict with Senator Thomas C.
Platt, the boss of the state. Senator Platt, therefore, desired to
divert the vigorous Governor into the vice-presidency, an office which
usually casts a "species of political oblivion" over its occupant.
McKinley was opposed to the plan and so were Hanna and Roosevelt
himself. The latter desired to put into effect further plans which he
had made as Governor, and the attempt to shelve him aroused his
fighting spirit. In the convention, however, sentiment in behalf of
Roosevelt, especially from the West, was so strong as to over-rule
both the administration and the wishes of the Governor. McKinley sent
emphatic word that he was neither for nor against any man, but would
accept the decision of the delegates. Hanna then withdrew his
objections and Roosevelt was nominated without opposition.

The Republican platform emphasized the prosperity which had resulted
from the accession of the party to power; it pointed out the danger
which would ensue if the opposition were allowed to conduct public
affairs; and it dwelt upon the growth of the export trade, and the
beneficence of the Dingley tariff. An antitrust plank deprecated
combinations designed to create monopolies, and promised legislation
to prevent such abuses. Imperialism was briefly dismissed: "No other
course was possible than to destroy Spain's sovereignty throughout the
West Indies and in the Philippine Islands. That course created our
responsibility before the world ... to provide for the maintenance of
law and order, and for the establishment of good government and for
the performance of international obligations."

The dissension which had existed within the Democratic party since the
second administration of Cleveland was still the important fact about
the organization. Having been out of power, the party could take only
the negative position of hostile criticism; there had been no
reorganization and clarification of purposes, and no new leader had
appeared who combined the personal prestige of Bryan with those
qualities of conservatism and solidity which the East demanded, so
that from the beginning there was no doubt that Bryan would again be
the candidate and that he would take the lead in framing the platform.
The convention met in Kansas City, on July 4. The platform placed most
emphasis upon three issues. The first, which was declared the
"paramount" one, was imperialism. The reasons given for opposing
territorial expansion were mainly those brought forward by Senator
Hoar at the time when the peace treaty was under discussion.

    We declare again that all governments instituted among men derive
    their just powers from the consent of the governed; that any
    government not based upon the consent of the governed is a tyranny;
    and that to impose upon any people a government of force is to
    substitute the methods of imperialism for those of a republic.

The second issue, the evils of big business, received renewed
attention, although an old complaint, because of the many industrial
consolidations of the years immediately preceding. The "trusts" were
condemned for appropriating the fruits of industry for the benefit of
the few, and the Republican party was charged with fostering them in
return for campaign subscriptions and political support. The Dingley
act was denounced as a "trust-breeding" measure. The remedies proposed
were severely definite in comparison with the vague plank which had
been offered by the Republicans: they included publicity as to the
affairs of corporations doing an interstate business; the prohibition
of stock-watering and attempts at monopoly; and the use of all the
constitutional powers of Congress over interstate commerce and the
mails for the enactment of comprehensive and effective legislation.
That the silver issue was mentioned was due to the insistence of Bryan,
who believed that the stand which had been taken by the party in 1896
was a right one. Notwithstanding the objections of many influential
leaders, therefore, a free silver plank was inserted, although in brief
terms and in an inconspicuous place.

As a political contest, the campaign of 1900 lacked life in comparison
with that of 1896. Interest in anti-imperialism was difficult to
arouse, and waned visibly as the weeks wore on. Prosperity and the
increased money supply sapped the strength of earlier discontent with
the currency situation, so that the choice presented to the voters
simmered down to imperialism and Bryan. A bit of vigor was infused into
the campaign through the energetic speaking tours of Roosevelt and the
Democratic leader. Hanna, as Chairman of the Republican National
Committee, organized everything with his usual skill, and raised, his
biographer tells us, $2,500,000 from the important business men of the
country--one-fifth of it from two companies. The result of the election
was the choice of McKinley, whose plurality over Bryan exceeded 860,000
in a total vote of less than 14,000,000; Bryan received less support
than had been accorded him in 1896.

While imperialism as a political issue was being discussed and decided,
the history of American control in Cuba, Porto Rico and the Philippines
was rapidly being written. Economic conditions in the first of these
islands at the time of the American occupation were little short of
appalling. The streets, houses and public institutions were filthy and
in disrepair; anarchy ruled, for lack of any stable and recognized
government; and the people were half-clothed, homeless and starving. At
noon on January 1, 1899, the Spanish flag was hauled down in Havana,
the American flag was hoisted in its place, and representatives of the
former government relinquished all rights to the sovereignty and public
property of the island. General John R. Brooke, and later General
Leonard Wood controlled affairs as military governors.

The first task was to feed the hungry, and care for the sick and dying.
The customs service was revived under command of Colonel Tasker H.
Bliss and began to supply needed revenue. The penal institutions were
investigated--noisome holes in which were crowded wretched prisoners,
many of whom had been incarcerated for no ascertainable reason.
Education was reorganized, equipment provided, teachers found, and
schools repaired or rebuilt. Most remarkable, was the work of
sanitation. Heaps of rubbish were cleared away; houses washed and
disinfected; sewers were opened and streets cleaned. Scientific
investigation disclosed the fact that the mosquito disseminated the
yellow fever and steps were taken to prevent the breeding of these
pests. So successful were the efforts that in a few years the fever had
become a thing of the past.

It was seen that the economic rehabilitation of Cuba must come about
mainly through the production of sugar, and since the United States was
the chief purchaser of the product, the tariff schedule was of vital
importance. In 1901 Congress was urged to reduce the tariff on imports
from Cuba, but the opposition was formidable. The American Beet Sugar
Association complained that their industry, which had been recently
established, would be ruined by allowing reductions to Cuban growers;
the cane-sugar planters of Louisiana were allied with them; and the
friends of protection feared the effect of any break in the tariff
wall. On the other hand, the American Sugar Refining Company, popularly
called the "Sugar Trust," merely refined raw sugar and desired an
increase in the supply. Lobbyists of all descriptions poured into
Washington to influence committees and individuals, and General Leonard
Wood, then the Governor of Cuba, even expended Cuban funds in the
spread of literature favorable to a reciprocal reduction of duties. In
the meantime, a reciprocity treaty was made and submitted to the
Senate, where it hung fire for somewhat more than a year, and was
finally ratified on December 16, 1903. It provided for the admission of
Cuban products into the United States at a reduction of twenty per
cent., and a reciprocal reduction on American goods entering Cuba of
twenty-five to forty per cent.

The establishment of a policy in regard to permanent relations between
the United States and Cuba was brought about in 1901-1902. When
Congress had demanded the withdrawal of Spain from the island in 1898,
its action had been accompanied by the Teller Resolution, disclaiming
any intention of keeping Cuba and asserting a determination to leave
the control of the island with its people. After the close of the war
President McKinley and his closest advisors in Congress had determined
that the pledge should be kept, and public sentiment had been in
agreement with them. As soon, therefore, as American control was an
established fact, plans were formulated for relinquishing Cuba to the
people of the island. A constitutional convention was held, and a form
of government, modelled on that of the United States, was framed and
adopted on February 21, 1901.

While the Cuban convention was deliberating, it became apparent that
the constitution would not include any statement of a policy in regard
to future relations with the United States. The American Senate,
therefore, under the leadership of Senator O.H. Platt, passed the
so-called "Platt Amendment." Its several provisions were as follows:
the Cuban government shall never enter into agreements with other
powers which tend to impair the independence of the island; it shall
not contract public debts of such size that the ordinary revenues would
be inadequate to pay interest charges and provide for a sinking fund;
it shall permit the intervention of the United States when needed to
preserve Cuban independence and the maintenance of an adequate
government; and it shall sell or lease necessary coaling stations to
the United States. When satisfied that the purpose of the Amendment was
not to enable the United States to meddle in affairs in Cuba, but
merely to secure Cuban independence and set forth a definite
understanding between the two nations, the convention incorporated it
in the final constitution. On May 20, 1902, the control of Cuba was
formally relinquished to the people of the island, with the good wishes
of the people of the United States. Only once since that time has the
United States intervened. During the summer of 1906, an insurrection
against the Cuban government took place during which the president of
the Republic requested American assistance. A small army was
despatched, which remained until March, 1909, when quiet was restored
and an orderly election was held.

The task of the United States in Porto Rico was far simpler than in
Cuba. The island was small; the people homogeneous, predominantly
white, and well-disposed toward American occupation; and only slight
damage had been done by the troops during the war because of the
cessation of hostilities at the outset of the Porto Rican expedition.
The development of a system of education, therefore, the improvement of
roads and the betterment of health conditions through vaccination and
the control of yellow fever presented a problem which was relatively
simple.

On October 18, 1898, United States officials assumed control of the
island, and until May 1, 1900, the government was in the hands of the
War Department. On the latter date a civil government was established
under the "Foraker Act," an organic law or constitution passed by
Congress on April 12, 1900. Under the provisions of the Act a governor
was to be appointed by the President of the United States, to be the
chief executive officer of the island. The people of Porto Rico were
allowed a voice in the government through the power to elect the lower
house of the legislature; but control by the United States was assured
by giving the President authority to choose the members of the upper
house, and by giving both the governor and Congress a veto on
legislation passed by the island legislature. In the course of time the
Porto Ricans desired larger self-government. This was granted by the
act of March 2, 1917, which made the islanders citizens of the United
States and gave them power to elect both houses of the legislature.[3]

The first difficulty met by the United States in the Philippines was an
inheritance from Spanish rule. In 1896 the Filipinos, led by Aguinaldo,
had risen against the government in order to secure more liberal
treatment and to eliminate the influence of the Catholic friars from
politics. The "embers of dissatisfaction" were still aglow when the
American war intervened. Relations between the revolutionists and the
United States forces became strained when the former were not allowed
to cooperate with the Americans against the Spanish, and in February,
1899, open warfare followed. Not until July, 1902, was quiet restored,
and during the process enough cruelties were practiced by American
soldiers to make the anti-imperialists doubly fearful of military
control.[4]

McKinley and his Secretary of War--at this time Elihu Root--desired to
supplant military government with civil rule as quickly as possible and
to this end the President appointed the first Philippine Commission on
January 20, 1899, with Jacob G. Schurman, of Cornell University, as
Chairman. It was instructed to investigate the situation in the islands
and to recommend any action that seemed wise. The unsettled condition
of affairs seriously hampered the work of the Commission but it
gathered a fund of information which it later published. A second
Commission was sent out in 1900, with Judge William H. Taft at the
head. The instructions given to the Commission by President McKinley
embodied an enlightened colonial policy, the core of which was that the
government being established was "designed not for our satisfaction, or
for the expression of our theoretical views, but for the happiness,
peace, and prosperity of the people of the Philippine Islands." The
Commission wielded such large powers that gradually the area controlled
by the civil government increased at the expense of the military
authorities, and by 1902 only the wild Moros were under military
control.

By this time a definite form of government could be planned for, built
upon the labors of the second Commission. The Philippine Act of July 1,
1902, provided for a governor appointed by the President, with the
advice of the Senate, executive departments, and a legislature, the
lower house of which was elected by the people. From the beginning the
Filipinos, like the Porto Ricans, have desired a greater range of
self-government, and in 1916 long steps were taken in the direction
desired by them. The Jones act of that year materially increased the
powers of the Philippine government and gave the Filipinos power to
elect the upper as well as the lower house of the legislature. The
passage of the law met with enthusiastic approval in the islands.

The purpose of American rule in the Philippines has been to fit the
people for self-government, although opinions have differed as to how
soon the final outcome could be brought about. An early and bothersome
problem was found in the friars' lands, which consisted of about
425,000 acres, for the most part in the vicinity of Manila. The
possession of so great an area, together with the religious power and
the considerable political authority which the friars exercised under
Spanish rule, gave the Church a domination which might threaten trouble
after the American occupation. The solution of the problem was found in
the purchase of the lands for about $7,000,000 by the United States.
Efforts have been made to introduce a complete system of
education--physical and industrial, as well as academic--with such
success that when the Jones bill was being discussed in Congress in
1916 it was asserted that every member of the Philippine legislature at
that time was a college graduate. In 1917 the Filipino student body
numbered 647,256, with 11,822 teachers. Political education has also
been a part of the American idea. Elementary self-government was
gradually introduced, starting in the more civilized local
municipalities and provinces and confining the suffrage to the educated
people, the official classes and property owners. The preservation of
order has been more and more entrusted to a Philippine constabulary;
civil service officers and school teachers have been increasingly
chosen from the Filipinos; and the courts have been partly manned with
native judges. Work in sanitation has followed the lines marked out in
Cuba and Porto Rico. First and last over 10,000,000 vaccinations were
performed before 1914; small-pox has been controlled; attention has
been paid to the building of highways and railroads, water supply, the
disposal of sewage and allied problems. The precise time, if ever, when
independence should be granted to the Philippines is the one great
question remaining.

The first attempt to revise the customs laws in the Philippines was
made by the Commission during the governorship of William H. Taft.
These schedules were revised in Washington in such a way as to
discriminate against Philippine interests, but they had remained in
force only a short time when Congress passed the act of March 8, 1902,
allowing goods grown or produced in the Philippines to enter the United
States under a twenty-five per cent. reduction. In 1909, the tariff
makers were induced to relent to the extent of allowing the free
importation of goods grown, produced or manufactured in the
Philippines, except that only a specified annual amount of Philippine
sugar and tobacco might be brought in. In 1913 the wall was entirely
removed on all trade between the United States and the Philippines in
articles made or grown in either of the two countries.

While Congress and the President were concerning themselves with the
practical problems of military control, sanitation and the like, the
Supreme Court was laboriously considering the less tangible but equally
perplexing question of the constitutionality of the several acts which
the legislative and executive departments had committed. The power of
Congress to acquire territory and the right of the executive to control
new territory under the war power had long been conceded. Admittedly,
however, government under the war power was temporary and transitional.
In earlier times such acquisitions as those effected by the Louisiana
purchase and the annexation of Texas had been consummated with the
distinct understanding that these regions should immediately or
eventually become territories or states in the Union. The status of
Porto Rico and the Philippines was novel. "The civil rights and
political status of the native inhabitants of the territories hereby
ceded to the United States," ran the words of the treaty of peace
closing the war with Spain, "shall be determined by the Congress." Did
this mean that Congress might govern the new acquisitions independently
of the Constitution? Could it abridge freedom of speech, and permit
cruel and unusual punishments, or establish slavery? Could Congress
permanently govern these lands without giving their citizens the rights
of citizens of the United States, and with no intention of ever making
them territories or states? On the other hand, if Congress must act
within the limits prescribed by the Constitution, would the wild Moros
of the Philippines be the beneficiaries of the amendment preserving the
right of trial by jury? In the popular language of the day, did the
Constitution follow the flag?

It was not long before the Supreme Court was called upon in the
"Insular Cases" to express itself upon these constitutional questions.
The first case was De Lima _v._ Bidwell. It was a suit to recover
duties paid on goods sent from Porto Rico to the United States during
the interval between the cession of the island and the passage of the
Foraker Act. The duties had been paid under the Dingley law, which
levied customs of specified amounts upon all goods imported "from
foreign countries." Was Porto Rico a "foreign" country? The majority of
the nine members of the Court thought that it was not foreign, that
there was scarcely a "shred of authority" for the view that a "district
ceded to and in the possession of the United States remains for any
purpose a foreign country." Since Porto Rico was not a foreign country,
the duties were wrongfully collected and must be returned. The
remaining four justices dissented. One of them delivered a dissenting
opinion in which he held that Porto Rico occupied middle ground between
that of a foreign country and domestic territory. As such its status
could be determined by Congress only and therefore its products were
subject to duties levied by the Dingley act.

In Downes _v._ Bidwell the Court was compelled to determine the
constitutionality of the part of the Foraker Act which provided for a
tariff between Porto Rico and the United States equal to fifteen per
cent. of that levied by the Dingley act. Again the Court divided five
to four. Mr. Justice Brown delivered the majority opinion. It was to
the effect that the Constitution applied only to States; that Congress
possessed unlimited power over the political relations of the
territories; that Porto Rico was a "territory appurtenant to and
belonging to the United States"; and that the part of the Constitution
which says that duties shall be uniform throughout the United States
did not apply to Porto Rico unless Congress so willed. Hence the
customs clause of the Foraker Act was valid. Four of the majority,
however, who agreed with Mr. Justice Brown in his conclusion that the
tariff clause of the Foraker Act was constitutional did so for reasons
which they asserted to be "different from, if not in conflict with,
those expressed" by him.

From the point of view of constitutional law, the decisions were
unsatisfactory, because of the balanced division of opinion. Yet to
have declared all the provisions of the Constitution in force in all
the acquisitions would have been embarrassing. Logic and the
Constitution went to the winds, while the executive and legislative
departments administered the territories on the convenient and flexible
theory that certain constitutional provisions must be heeded and that
others need not.

While the colonial policy of the United States was being developed, the
possession of the Philippines added interest in the United States to an
unusual international situation in China which immediately involved
several European nations and eventually affected America. The
Chinese-Japanese War, which came to a close in 1895, had uncovered to
the world the weakness of China as a military power and had weakened
the hold of the reigning monarch upon the people of the Empire.
Thereupon the leading commercial nations of Europe began to seize
portions of China in order to extend their trade relations in the Far
East. Russia first attempted to obtain a seaport, but retired when an
uproar of protest arose from the remainder of Europe. Not long
afterwards, two German missionaries in the province of Shantung were
murdered. The outrage formed a sufficient pretext for aggressive
action, as a result of which China leased Kiaochau to Germany for
ninety-nine years, including in the grant railway and mining privileges
and an indemnity; Russia then renewed her attempt and succeeded in
leasing Port Arthur and Talienwan for twenty-five years. Great Britain
followed with the acquisition of rights in Weihaiwei similar to those
of Russia in Port Arthur; Japan found its share in the province of
Fukien, and France in Kwangchaouwan. In each case, moreover, the
leasing power designated a large area around its holdings as a "sphere
of influence," in which its economic and political mastery was
complete. In this way, thirteen of the eighteen provinces of China,
including the most desirable harbors, waterways and mines, were
partially controlled by the powers.

American foreign affairs had been, since October 1, 1898, in the
skilful hands of John Hay, who was possessed of an intimate knowledge
of conditions in Europe. Hay perceived the danger to American
commercial interests in China, and accordingly in September, 1899, he
addressed a circular note to the powers requesting each of them to give
formal assurances that in its sphere of influence: (1) it would not
interfere with any treaty port or vested interest; (2) it would agree
that the Chinese tariff should apply equally to all goods shipped to
ports in the spheres, and be collected by the Chinese officials; and
(3) it would charge no higher harbor and railroad rates for citizens of
other nations than for its own. The powers having agreed more or less
directly, Hay informed them by a note of March 20, 1900, that all had
acceded to his propositions and that the United States considered their
assent as "final and definitive." There could be, of course, no
effectual guaranty that the powers would fully observe this "Open-Door"
policy, but the economic penetration of China, which would soon result
in complete political possession, was at least retarded for the moment.

Domestic affairs in China, meanwhile, had been seething under the
surface. An ill-starred reform movement, initiated by the Emperor, had
failed, the government was discredited, and the Empress Dowager seized
the throne for herself. All China interpreted the event to presage a
return to the old order of things--a general anti-foreign movement.
Economic distresses, bad crops, a disastrous flood and hatred of
foreign missionaries, combined with a deep resentment at the European
partition of their country, caused the Chinese to break out in a score
of scattered attacks on the hated aliens. The culmination was the Boxer
Rebellion. The Boxers was a society which had long existed in China for
various religious, patriotic and other purposes. It took up the cry
"Drive out the foreigners and uphold the dynasty." Government officials
by their disinclination to quell the Boxer uprising, showed that their
sympathies were with the rioters.

The climax of the outbreak came in and around Pekin, the capital of
China. The railroad from the city to the coast was seized, telegraphic
connection cut off, and the representatives of the foreign powers were
compelled to fortify themselves within the city. On June 19, 1900, all
foreigners were ordered to leave within twenty-four hours, and the
German minister was shot when he attempted to visit the proper officer
in order to protest. The Chinese army poured out to surround the
quarter of the city where the legations were situated and cut them off
from the rest of the world. All foreigners fled to the British
legation, where they constructed bomb proof cellars, raised barricades
and planted artillery.[5] The powers, including the United States,
combined to send a punitive expedition to Pekin, while the legationers
settled down to a state of siege, determined to hold out as long as
possible. At last on August 14, when the surviving foreigners were
reduced to eating horse flesh and when scores had been killed or
wounded, the relief column reached the capital. It was high time. The
foreign quarters and much of the business portion, the banks, and the
theatres had been burned, and the entire city threatened with
destruction.

By the time that the uprisings in Pekin and elsewhere had been
suppressed, it was evident that the powers would have a stern
accounting with China. Hay had already openly announced the policy of
the United States in his note of July 3, 1900; it was that the United
States would seek a solution which should bring about permanent safety
and peace to China, preserve the territorial entity of the country,
protect the rights of friendly powers and insure an equal opportunity
for all nations in the commerce of China. Hay continued through the
negotiations to urge joint action on the part of the powers, and
procured from them a statement disclaiming any purpose to acquire any
part of China. At length in December, 1900, the demands upon China were
formulated, to which that unhappy nation was compelled to accede. The
most important were, punishment for the guilty rioters, safeguards for
the future, indemnities for losses and the improvement of commercial
relations. The financial indemnity finally placed upon China was
$333,000,000, of which $24,000,000 was for the United States. The
latter sum proved to be more than sufficient to satisfy all claims and
China was relieved from the payment of about $11,000,000. As a mark of
appreciation for this act, the Chinese government determined to use the
fund in sending students to the United States for education.

While the problems concerning China and the colonial possessions of the
United States were reaching a settlement, on September 6, 1901,
President McKinley attended the Pan-American Exposition in Buffalo,
where he was shot by a young fanatic. He died eight days later and
Vice-President Roosevelt succeeded him.


BIBLIOGRAPHICAL NOTE

The framing, contents and ratification of the treaty of 1898 are well
described in Chadwick, Latané and Olcott. The treaty itself is
conveniently found in William MacDonald, _Documentary Source Book of
American History_ (new ed., 1916).

On imperialism: L.A. Coolidge, _An Old-Fashioned Senator, O.H. Plat_
(1910); G.F. Hoar, _Autobiography of Seventy Years_, contains a strong
argument against imperialism; A.C. Coolidge, _United States as a World
Power_ (1916).

The best accounts of the election of 1900 are in Stanwood, Croly and
Latané.

The island possessions have given rise to a considerable body of
special volumes of a high order. Especially useful are: (Cuba), Elihu
Hoot, _Military and Colonial Policy of the United States_ (1916), by
McKinley's Secretary of War; L.A. Coolidge, _O.H. Platt_ (1910); A.G.
Robinson, _Cuba and the Intervention_ (1905); C.E. Magoon, _Republic
 of Cuba_ (1908), by the provisional governor during the second
intervention. (Porto Rico), W.F. Willoughby, _Territories and
Dependencies of the United States_ (1905), by a former treasurer of
Porto Rico; L.S. Rowe, _United States and Porto Rico_ (1904). The most
complete work on the Philippines is D.C. Worcester, _Philippines: Past
and Present_ (2 vols., 1914), by a member of the Commission; the
valuable report of Commissioner Taft is in _Report of the Philippine
Commission_, 1907, part 3, printed also as _Senate Document 200_, 60th
Congress, 1st session, vol. 7, (Serial Number 5240).

The legal and constitutional aspects of imperialism are best followed
in the _Harvard Law Review_, vols. XII, XIII; W.W. Willoughby,
_Constitutional Law of the United States_ (2 vols., 1910); C.F.
Randolph, _The Law and Policy of Annexation_ (1901); the "insular
cases" are in _United States Reports_, vol. 182, pp. 1, 244.

The most complete account of affairs in China is P.H. Clements, _The
Boxer Rebellion_ (1915); J.B. Moore, _Digest_, vol. V (1906), is
useful, as always; J.W. Foster, _American Diplomacy in the Orient_
(1903), is clear and concise; W.R. Thayer, _John Hay_ (2 vols., 1915),
is disappointing.

       *       *       *       *       *

[1] The American commissioners were W.R. Day, Secretary of State;
Whitelaw Reid, editor of the New York _Tribune_; and Senators C.K.
Davis, W.P. Frye and George Gray. Senator Hoar remonstrated with
McKinley for placing senators on such commissions as this, on the
ground that the independence of the Senate was thereby lessened when
the question of ratifying the treaty came before that body. He declared
that McKinley admitted that the practice was wrong. Cf. _Autobiography_,
II, 46-51.

[2] Of the President's party, T.B. Reed, the powerful Speaker of the
House, retired from public life for personal reasons and because of his
dissent from the imperialist policy of his party. McCall, _Reed_,
237-8.

[3] Under the provisions of the Foraker Act only fifteen per cent. of
the usual duties were to be paid on goods passing between the island
and the United States, and since July 25, 1901, complete free trade has
existed.

[4] The Philippine group is about 7,000 miles southwest of San
Francisco; the chief island, Luzon, is almost exactly the size of Ohio,
40,000 sq. miles; the largest city, Manila, contained over 250,000
people at the time of the American occupation.

[5] It was on the occasion of despatching troops to avenge the death of
Von Ketteler, the German minister, that the Emperor gave instructions
to "give no quarter and to (act) so like Huns that for a thousand years
to come no Chinese would dare to look a German in the face."




CHAPTER XIX


THE BEGINNING OF A NEW CENTURY

Most of the tendencies which characterized the growth of population,
the expansion of the West, the concentration of the people in cities,
the development of manufacturing and agriculture, and the extension of
the railway system, from 1870 to 1890, were equally significant during
the two decades following the latter year. Nevertheless there were
important differences of detail in the tendencies of the later period;
and about the year 1900 in particular there occurred changes that were
far-reaching.

[Illustration:
The chief foreign elements in the population of the United States, 1910]

The rate of growth of population slowed up slightly after 1890, being
twenty-one per cent. per decade, as contrasted with twenty-five per
cent. from 1870 to 1890. The increases were distributed over a larger
area during the later two decades, and aside from the industrial
states, those which showed the greatest growth were Oklahoma, Texas and
California. Immigration continued to be large, and concentrated in the
north, especially in the cities. In New York city, for instance, forty
per cent. of the inhabitants in 1910 were foreign born, and
thirty-eight per cent. more were of foreign, or mixed foreign and
native parentage. The chief European contributors to the population of
America in 1910 in the order of their importance were Germany,
Austria-Hungary, Russia, Ireland, Italy and England. Moreover the
foreign elements had frequently become concentrated in especial states:
the Germans in Wisconsin, Minnesota and Illinois; the Russians in New
York, North Dakota and Connecticut; the Austrians in Pennsylvania and
New Jersey; and the Irish in Massachusetts, Connecticut and New York.
The immigration of Canadians, which had been of importance before 1900,
appreciably slowed down after that year; and instead there was a
distinct movement in the opposite direction, especially from Minnesota,
North Dakota and Washington. The emigration was caused mainly by the
desire to take up fertile lands which had been widely advertised by the
Canadian government. The migration from the eastern states toward the
West continued as in earlier years. It was noticeable, however, that
whereas previous migration had been almost wholly on east and west
lines, there was in later years a greater tendency to seek favorable
openings wherever they were found. Oklahoma, for example, in 1910
contained 71,000 natives of Illinois, 101,000 Kansans and 162,000
Missourians. The trend of population toward the cities was so rapid
between 1890 and 1910 as to suggest the likelihood that by 1920 half
the people of the country would be living in communities of 2,500
persons or more. Of the twenty-three towns that more than doubled in
numbers during the two decades after 1890, seventeen were in the South
and on the Pacific Coast, indicating that the tendency toward urban
life was no longer confined to the North and East.

Manufacturing increased its importance as the greatest economic
activity in the Northeast, and was moving westward so rapidly that
Ohio, Michigan, Indiana and Illinois found their interests becoming
increasingly like those of the eastern states. Parts of the South,
also, developed considerable industrial interests. The manufacture of
cotton goods, for example, increased with such rapidity that three of
the first five states in the value of their product in 1909 were
southern states--North Carolina, South Carolina and Georgia. Since 1889
the production of lumber has taken a prominent place. Louisiana doubled
its activity from 1889 to 1899 and had tripled this record by 1909.
Almost the entire South from Virginia to Louisiana produced large
amounts during the twenty years under consideration. The iron and steel
industry in Alabama, and the production of turpentine, resin and
fertilizers were other important southern interests. Throughout the
country at large the number of wage earners engaged in manufacturing
grew somewhat more rapidly than the population, being about twenty-five
per cent. per decade from 1890 to 1910.

The center of agriculture continued to be in the Middle West, in which
was to be found nearly fifty-three per cent. of the improved farm lands
and fifty-eight per cent. of the value of all farm property. It was in
this part of the country that the greatest increases in the amount of
improved land took place, and particularly in the prairie country west
of the Mississippi. By 1890 the Plains had lost their earlier unique
and picturesque characteristics as a cattle country, and had given way
to the homesteader. Hence the greatest expansion in agriculture took
place in the tier of states from North Dakota to Texas. It appeared,
therefore, that manufacturing was driving agriculture farther and
farther to the west: New England cultivated less farm land in 1910 than
in 1850; the improved area in New York, New Jersey and Pennsylvania
declined after 1880; Ohio tilled fewer acres in 1910 than in 1900, and
the gradual replacement of agriculture by manufacturing was observable
in Indiana and Illinois. Oklahoma and Texas, on the other hand,
together opened to cultivation between 1890 and 1910 nearly 24,000,000
acres, an expanse almost equivalent to the combined areas of New
Hampshire, Vermont, Massachusetts and Maryland.

By 1890 it was clear that the future of the Far West lay in
agriculture, rather than in the mining of the precious metals. Between
that date and 1910, the amount of improved farm land in the section
increased sixty-five per cent. In the states of Washington, New Mexico,
Colorado, Idaho and Montana, large areas were placed under cultivation.
In Washington the amount of improved farm land increased about 350 per
cent. The growing of fruits and nuts was brought to a high state of
excellence in the coast states. The timber industry developed after
1880 and particularly after 1900. About the close of the nineteenth
century the great lumber companies began to seek sources of supply to
take the place of those around the Great Lakes. They turned to the
South and the Far West. The methods which were used for getting control
of the land, and the recklessness with which the supplies of timber
were cut off became of importance as causes of the conservation
movement. The main handicap in the way of the development of trade
between the Far West and the East was the great distances involved.
Hence arose the interest of the Coast in transcontinental railway rates
and the project for a canal across the isthmus of Panama.

An economic fact of no little importance was a change in the downward
tendency of the price level after 1896. It will be remembered that the
constant fall in prices from 1873 to 1896 had brought distress to the
farmers of the West and had been one of the causes of the Populist
revolt. After 1896 the process was reversed. Between that year and 1913
the quantity of gold in circulation considerably increased, as has been
seen; bank deposits subject to check trebled in volume, and the use of
checks became more common; altogether it was estimated by Professor
Irving Fisher that the quantity of money in circulation increased
two-fold. Prices were fifty per cent. higher in 1913 than in the
earlier year, and accordingly the complaints of the farmer were less
frequently heard. The wage earner in the factories, however, was
differently affected. The price which he had to pay for the necessities
of life increased faster than his wages, so that his standard of living
was going down. Inasmuch as the number of wage earners in the factories
was rapidly increasing, it seemed inevitable that the problem of rising
prices after 1896 would constitute as great a problem as the problem of
falling prices had done before that year.

[Illustration:
The Cost of Food, 1900-1912]

In industrial enterprise the close of the nineteenth century and the
opening of the twentieth were characterized by a mad rush toward
consolidation. To a milder degree the process had, of course, been
under way for many years, during which the Standard Oil Company and
other trusts were the subject of much study and legislation. In the
course of time some of these concerns made such great profits that
their leaders sought attractive openings for the investment of their
surplus. They began to appear on the boards of directors of railways,
banks, electric lighting companies and other industrial organizations.
Before 1900 two powerful groups had definitely formed. The Standard or
Rockefeller group was obtaining large interests in such railroads as
the Missouri, Kansas and Texas, the Delaware, Lackawanna and Western,
and the Chicago, Milwaukee and St. Paul. It was reaching out to the gas
and electric companies in New York, had an alliance with the National
City Bank and others, and was in touch with great life insurance
companies such as the Equitable and the Mutual of New York. Such
connections enabled them to determine the policies and direct the
investments of these important concerns. The Morgans extended their
influence over the Philadelphia and Reading, the New York, Lake Erie
and Western, the Lehigh Valley and others. Morgan himself also entered
the industrial field as organizer of the Federal Steel Company and the
National Tube Company.

The mania for organizing large corporations came to a climax about
1900. The census taken in that year noted ninety-two that had been
formed between January 1, 1899, and June 30, 1900. Early in 1904 the
editor of Moody's _Manual of Corporation Securities_ noted the
existence of 440 large industrial and transportation combinations whose
capitalization as measured by the par value of their stocks and bonds
was nearly $20,500,000,000. The securities--stocks and bonds--of the
new companies were eagerly taken up by the investing public. Prosperity
was wide-spread and the financial strength behind the organizations
seemed unlimited. Speculation became common. A few individuals amassed
wealth through the shrewd purchase and sale of stocks, and countless
others sought unsuccessfully to imitate them. Where sales of 400,000
shares on the stock exchange had formerly been looked upon as a good
day's business, the record jumped to a million, then two, and even
three.[1]

A threatened competitive struggle among certain steel manufacturers in
1901 led to the formation of the United States Steel Corporation, the
most famous consolidation of the period. It was, strictly speaking, a
"holding corporation" which did not manufacture at all, but merely held
the securities and directed the policies of the group of companies of
which it was composed. It integrated all the elements of the
industry--ore deposits, coal mines, limestone, a thousand miles of
railroads, ore vessels on the Great Lakes, furnaces, steel works,
rolling mills and other related interests. The value of the tangible
property which was thus brought under the control of a single group of
men was estimated by the United States Commissioner of Corporations at
about $700,000,000. The company issued securities, however, to somewhat
over twice this amount. In other words, about $700,000,000 of the
capitalization was "water," that is, securities issued in excess of the
value of the tangible properties owned. The prices paid to those who
controlled the constituent companies were such as to make them
multi-millionaires over night, and the commission given to the
financiers who organized the Corporation was unparalleled in size,
amounting to $62,500,000.

The appreciation of the value of the ore deposits controlled by the
Steel Corporation later replaced some of the water in its securities,
but in many cases no such process came about. Investors therefore
discovered that the paper which they had purchased did not represent
real property, but merely the hope of a company that its profits would
be large enough to provide returns upon all its securities. One hundred
of the leading industrial stocks shrank in value $1,750,000,000 within
eighteen months. In the case of the Steel Corporation it was noticeable
that its supremacy depended to a large extent on the possession of
resources of ore on land much of which had originally belonged to the
public, a fact which, the Commissioner of Corporations remarked, made
the affairs of the company a matter of public interest.

The growth and consolidation which characterized the history of
industry were also taking place in the railway system, although
somewhat more slowly. It has already been noted that the length of the
railroads had reached 160,000 miles by 1890. For the next two decades
the rate of construction diminished slightly, yet the total in 1914 was
252,231 miles, and the par value of all railroad securities was
estimated at $20,500,000,000. Nearly four and a half million persons, a
railroad president estimated in 1915, were at that time interested in
the industry as employees, as workmen in shops making railroad
supplies, or through the ownership of stocks and bonds.

The management of the roads is, of course, continually changing;
alliances are made and broken; groups form and dissolve. About the time
that the United States Steel Corporation was being organized, however,
about ninety-five per cent. of the important lines were in the control
of six groups of influential persons, which were dominated by fourteen
individuals. Each group had obtained the upper hand in the roads of one
or more sections. The Morgan-Hill group, for example, held the Chicago,
Burlington and Quincy, the Northern Pacific, the Great Northern, the
Southern, the Atlantic Coast Line, the Erie and others, amounting to
47,206 miles. E.H. Harriman, chairman of the board of directors of the
Union Pacific, succeeded in obtaining control of so many lines that by
1901 the Interstate Commerce Commission asserted that the consummation
of plans which he then had in mind would subject nearly one-half the
territory of the United States to the power of a single will. Before
his death in 1909 he had obtained practical control of a system of
roads running from coast to coast and passing through the most
important cities of the country and had planned to continue
indefinitely the process of acquiring new lines.

[Illustration:
Morgan-Hill railroads as listed shortly after 1900]

The concentration of the banking interests of the country went hand in
hand with consolidation in industry and railway control. The
unprecedented operations which have just been mentioned demanded
unprecedented amounts of capital and credit, and the concentration of
these necessities occurred in New York City. The Standard Oil group and
the Morgan group dominated the banking interests to such an extent that
it was doubtful whether any great business enterprise demanding large
capital could be started without the aid of one or the other of them.
Some years later a congressional investigation was started, to discover
whether the control of a few men over the financial affairs of the
nation amounted to a "money trust," and at that time it was found that
the members of four allied financial institutions in New York City held
341 directorships in banks, insurance companies, railroads, steamship
companies and trading and public utility corporations, having aggregate
resources of $22,245,000,000.

The financial power thus placed in the hands of a small number of men
was the cause of much legislation passed by the states and by Congress
in connection with the railroads and trusts. Opinions varied widely in
regard to the effects of concentration. On the one hand it was argued
that the men of greatest ability and vision naturally came to the top;
that industry received the necessary stabilizing influence; that
production and demand were compelled to harmonize; that scientific
research directed toward the discovery of new processes and products,
and the better utilization of old ones could be successfully carried on
only by concerns with large resources; and that efficiency and economy
resulted from large-scale operation. On the other hand it was pointed
out that a small number of persons who were responsible to nobody could
dominate the fortunes of hundreds of thousands of wage earners,
manipulate production, make or break a region or a rival, bring about
financial crises and, in a controversy or for private gain, use a great
industry or a railroad as a weapon and wreck it regardless of the
welfare of the public at large.

Among the intellectual forces underlying American history after 1890, a
prominent place should be given to the expansion of the public library,
the growth of public education and the development of the press. Many
libraries, of course, had been established long before the Civil
War--the Library of Congress, for example, having been founded in
1800--but the great growth of the public library supported by taxation
and open to all citizens alike occurred after 1865. Between that year
and 1900 no fewer than thirty-seven states passed laws enabling the
towns within their borders to levy taxes for the support of public
libraries; private bequests amounted to fabulous sums, the outstanding
example of which were the gifts of Andrew Carnegie, amounting to
$62,500,000 between 1881 and 1915. By 1914 there were over 2,000
libraries containing at least 5,000 volumes, and forty that contained
more than 200,000 each.

The significant features in the growth of education between 1865 and
1890 had been the improvement of the public grammar school, the
establishment of high schools and the foundation of the great state
universities. After 1890 the public high schools were greatly improved,
business and vocational courses were added, and the enrollment at the
colleges and universities received large additions. Such universities
as that in Wisconsin exerted an unusual influence on intellectual and
political currents in individual states.

A large proportion of the political, social and economic changes and
reforms that have taken place in the United States since 1890 have done
so because public opinion was educated, quietly influenced or noisily
bestirred by the press. Governors and presidents appealed to their
constituents through the newspaper and the periodical. Political
campaigns have become increasingly matters of publicity; candidates for
office have their press bureaus; corporations, abandoning their
traditional policy of silence, explain their practices; and railroads
defend their policies by means of advertisements in the newspapers.
Newspaper correspondents go out through the country months before
candidates for the presidency are nominated, and discover and publish
sentiment favorable to the individual whom the particular organ desires
to see placed in office. In 1918 the circulation of the daily
newspapers amounted to approximately 28,000,000 copies for each issue.
In the North, the Middle West, and on the Pacific Coast the number
published was sufficient to provide every family with one copy. The
South and the Rocky Mountain region were less well supplied. The great
metropolitan newspapers circulate widely, not only in the immediate
vicinity of the publisher's office, but over a wide area outside. At
least one of them in 1918 approached half a million copies daily,
another exceeded 800,000, and a third issued nearly three-fourths of a
million on Sunday. William R. Hearst established a chain of newspapers
which gave him an audience of over a million readers every day. Several
of the weekly and monthly magazines circulated in hundreds of thousands
of copies; and one weekly periodical which presented newspaper opinion
of all shades of political partisanship had a circulation of 750,000
copies for every issue.

[Illustration:
Daily Newspaper Circulation, 1918]

The rise of the "muck-rake"[2] magazines was typical of the ten years
at the opening of the twentieth century. These periodicals printed
articles which portrayed a side of American life not commonly discussed
in the newspapers. One of the earliest serials of this type was Miss
Ida M. Tarbell's History of the Standard Oil Company, published in
_McClure's Magazine_ in 1902-1903. Instead of the ordinary eulogy of
the size and success of the Company, Miss Tarbell presented many of its
unfair practices. At the same time and in the same publication Lincoln
Steffens was exposing the seamy side of municipal affairs in "The Shame
of the Cities." Between 1901 and 1906 one of the muck-rake periodicals
increased its sales threefold, another four and another seven.

Cooperation among newspapers in the gathering of information is no
novelty in the United States, but the greatest strides have been taken
since 1890. By 1915 the Associated Press had leased 50,000 miles of
telegraph wires forming a net all over the country; it had agents in
every important news center; it exchanged services with three European
press associations; and it had its own representatives not only in
London, Paris, and Berlin, but in Fez, Madeira, Colombo, Tsingtau and
Sydney. News from Europe reached New York in less than an hour and was
promptly sent to 900 newspapers, whence it was copied in thousands of
daily and weekly publications. As in the case of other enterprises the
publication of newspapers showed a tendency towards consolidation. The
establishment of a new periodical became a million-dollar venture, and
it remains to be seen whether the tendency toward centralization will
result in the publication only of such news or such phases of the news
as meet the approval of the relatively small number of persons that can
launch a million-dollar organization.

It will be remembered that _laissez faire_ was the prevailing theory in
regard to the proper relation between government and industry during
the twenty-five years after the close of the Civil War, except in so
far as industrial organizations desired protective tariffs. In brief
the upholders of this creed contended that legislation should concern
itself as little as possible with the regulation of trade, that it
should restrict itself to protecting commerce from interference and
that business men should be permitted to work out their own problems
with the least possible reference to such artificial forces as were
supplied by legal enactments.[3] It would be inaccurate to say that the
theory of _laissez faire_ had completely given way by the end of the
half century after the Civil War. Nor would it be wholly correct to say
that any other theory has yet demonstrated its permanent reliability,
Nevertheless the distinctive philosophy upon which later legislation
has been built is the theory of public interest. The theory needs
definition in some detail, because it forms the philosophy which
underlies most of the political developments and much of the
legislation of the early twentieth century.

As the men of the eighties and nineties contemplated the vast amounts
of wealth created during those decades they saw it concentrated to a
great extent in the hands of the few. The few believed that the public
good was best cared for in this way, but an increasing majority of the
people looked upon the tendency with greater and greater alarm. They
complained that the railroads discriminated in favor of the powerful
few; that corporations were achieving monopoly; and that the government
itself often assisted the process by framing tariff schedules primarily
for the interest of the manufacturers. When the reaction against this
situation started, it was of course found that the seats of power were
already occupied by the adherents of _laissez faire_,--the party
committees, the legislatures, the executive offices and the courts.
There ensued, therefore, a long struggle for power and for a new theory
of government. The land-marks of the controversy were to be found in
interstate commerce acts, anti-trust laws, income taxes, bureaus of
labor and factory legislation.

The proponent of _laissez faire_ would allow the few to accumulate
large fortunes which they might share with the many through
benefactions, gifts to education, libraries, and other public
enterprises; the adherent of public interest would inquire why the many
are poor, and attempt so to change economic conditions as to reduce the
number of the poor to a minimum. Instead of framing laws so that wealth
and power would get into the hands of a small number of individuals, in
the expectation that prosperity would filter down to the many, the
advocate of public interest would aim his legislation directly at what
he considers the needs of the less powerful classes. He would interfere
with the railroads, for example, to compel them to charge uniform
rates, prevent corporations from electing public officers by means of
large contributions to campaign funds, force industry even at some cost
to protect employees through safety devices, and would hold the great
forests on the public lands for the direct good of the whole people.
The transfer of emphasis from _laissez faire_ to public interest was
based upon a steady growth in the value placed upon the worth of the
individual man, and upon a shift from legislating for the few to
legislating directly for the multitude. The change was greater than can
be indicated by citing any one law or group of laws. It was "a new
intellectual perspective through which we view all moral issues
affecting society."[4]

Underlying many of the difficulties in the way of replacing _laissez
faire_ with a new theory, was the attitude of the courts toward certain
parts of the Fourteenth Amendment. It will be remembered that a portion
of section one of the Amendment forbids the states to "deprive any
person of life, liberty, or property, without due process of law." It
will also be remembered that the majority of the Supreme Court in early
decisions interpreting the Amendment had expressed the belief that its
purpose was the protection of the negro. By 1890, however, the Court
had come to hold that the word "person" as used in the first section
included corporations, and thus had given the language of the Amendment
a greatly widened application. Of 528 decisions given by the Court on
the Amendment between 1890 and 1910, only nineteen concerned the negro
race, while 289 affected corporations. In the decision of the case
Lochner _v._ New York, a state law regulating hours of labor in
bakeries was declared to conflict with the Amendment, because the right
of the laborer to work as many hours as he pleased was part of the
"liberty" which was protected by the Amendment. Laws regulating
railroad rates through commissions were held to deprive corporations of
property without due process. Until recently changed, the statutes did
not allow appeal to the Supreme Court in cases where state courts
declared state laws in conflict with the United States Constitution,
and the Fourteenth Amendment therefore acted as a protective bulwark in
state as well as nation. In brief, then, the legal position of the big
industrial organizations was almost impregnable because of the
fortuitous circumstance that the words of a part of the Constitution
might be held to mean something which probably did not enter the minds
of the Congress or the state legislatures which placed the words in the
document.

The people of the United States have usually avoided hostile criticism
of the Constitution and the decisions of the Supreme Court, and they
have reflected this feeling in their acquiescence in the unexpected
turn given to the meaning of the Fourteenth Amendment. The members of
the Court, however, have frequently expressed disquietude. Dissenting
opinions opposing the view which the Court has taken, have been common.
Mr. Justice Harlan declared that the scope of the Amendment was being
enlarged far beyond its original purpose; Mr. Justice Holmes asserted
that the word "liberty" was being "perverted" and that the Constitution
was not intended to embody _laissez faire_ or any other economic
theory.[5]

The most prominent pioneers in replacing the old by the new theory were
William J. Bryan, Robert M. La Follette and Theodore Roosevelt. Bryan's
leadership in 1896 has already been mentioned. With courage and
sincerity he attempted to solve the social and economic problems of his
day, but his youth, his inexperience, his radicalism, and the fact that
he did not choose issues that were immediately practicable made it
impossible for him to command the confidence of the majority. Unable
himself to scale the heights of reform, he nevertheless pointed them
out to others. With a voice that has been likened to an organ with a
hundred stops, with persistence, energy and good nature he spread far
and wide a new conception of social obligation. He insisted that the
social and economic discontent of the South and West were real, and
that they could not be laughed out of court or frightened into silence.

La Follette's constructive pioneer work was done for the most part in
Wisconsin. During the ascendency of the _laissez faire_ theory, the
state was largely controlled by the lumber, railroad and other
interests, using the Republican party as their political agency; and a
small but powerful group controlled the election of state and federal
officials, the press and state legislation. Between 1885 and 1891 La
Follette, who was himself a Republican, was a representative in the
federal House. In the latter year he came into collision with Senator
Sawyer, a wealthy lumber merchant who was the leader of the dominant
party in the state. For years the state treasurers had been lending the
state's money to favored banks without interest. Senator Sawyer had
acted as bondsman for the treasurers and was sued by the
attorney-general of the state for back interest. La Follette threw
himself into this controversy on the side of the state; and being
unable to obtain a hearing through the usual medium of the press, he
and his supporters went directly to the people, speaking from town to
town before interested audiences; and subsequently the state won.

In the Sawyer controversy were visible all the elements of the later
creed and methods of La Follette. He always remained with the
Republican party, preferring to attempt change from within; and he
always opposed the interests and found his strength in direct appeals
to the people of his state. Out of those years came the "Wisconsin
idea,"--a program which included the taxation of railroads and
corporations, primaries in which the people could nominate their own
candidates for office, the prohibiting of the acceptance of railroad
passes by public officials, and the conservation of the forests and
water power of the state. The conflict between _laissez faire_ and
public interest in Wisconsin was long and bitter, but it led to a
series of triumphs for La Follette, who was elected governor in 1900,
1902 and 1904, and chosen to the federal Senate in 1905. In the
meanwhile there was a widespread demand throughout the West for
legislation along the lines marked out by Wisconsin.

Party lines are so drawn in the United States that it is difficult for
like-minded men of different parties to cooperate in furthering a
program. The three pioneers were men whose capacities and personal
qualities differed greatly, but in their economic and political
philosophy they were nearer to one another than to the rank and file of
their own parties. Bryan in 1902 refused to take part in the Democratic
campaign in Wisconsin because he favored La Follette's program, and in
1905 he even aided the latter in his fight for railroad regulation; in
1912 Bryan found Roosevelt leading a revolt in the Republican party on
a program to much of which he could give unqualified assent; and of La
Follette, Roosevelt said in the same year: "Thanks to the movement for
genuinely democratic popular government which Senator La Follette led
to overwhelming victory in Wisconsin, that state has become literally a
laboratory for wise experimental legislation aiming to secure the
social and political betterment of the people as a whole."

Roosevelt's own share in the history of the early twentieth century was
of such magnitude as to require a more extended account.


BIBLIOGRAPHICAL NOTE

The literature is voluminous and not easy to evaluate. On population
changes and immigration, the best source is the _Abstract of the
Thirteenth (1910) Census_ (1913), with the _Atlas_ accompanying it
(1914); _Reports of the Immigration Commission, appointed under the
Congressional Act of Feb. 20, 1907_ (42 vols., 1911), is exhaustive; F.
A. Ogg, _National Progress_ (1918), has a good chapter; consult Joseph
Schafer, _A History of the Pacific Northwest_ (rev. ed., 1918), for
Washington and Oregon.

The consolidation in industry, railroads and finance may be followed
in: A.D. Noyes, _Forty Years of American Finance_ (1909); John Moody,
_The Truth about the Trusts_ (1904); _Report of the Commissioner of
Corporations on the Steel Industry_ (3 parts, 1911), on the United
States Steel Corporation; Anna P. Youngman, _Economic Causes of Great
Fortunes_ (1909); C.R. Van Hise, _Concentration and Control a Solution
of the Trust Problem in the United States_ (rev. ed., 1914); E.R.
Johnson and T.W. Van Metre, _Principles of Railroad Transportation_
(1916); John Moody, _The Railroad Builders_ (1919); John Moody, _The
Masters of Capital_ (1919); and _Report of the Committee Appointed
Pursuant to House Resolutions 429 and 504 to Investigate the
Concentration of Control of Money and Credit_, (Pujo Committee) 1913.

There is no satisfactory study of the social and political effects of
the great increase in the circulation of newspapers and periodicals.
Suggestive articles are: _World's Work_ (Oct., 1916), "Stalking for
Nine Million Votes"; _Arena_ (July, 1909), "The Making of Public
Opinion"; _Atlantic Monthly_ (Mar., 1910), "Suppression of Important
News." Less superficial articles are those of Walter Lippmann in the
_Atlantic Monthly_ (Nov., Dec., 1919). The statistics are available in
N.W. Ayer, _American Newspaper Annual and Directory_.

The emergence of the theory of public interest is best seen in the
_Autobiography_ of R.M. La Follette (4th ed., 1920); consult also
Theodore Roosevelt, _Autobiography_, and C.G. Washburn, _Theodore
Roosevelt; the Logic of his Career_ (1916). A profound article is W.J.
Tucker, "The Progress of the Social Conscience," in _Atlantic Monthly_
(Sept., 1915).

On the Fourteenth Amendment, consult the volumes already mentioned
under Chap. IV.

There are no thorough estimates of Bryan and La Follette. On the
former: _Atlantic Monthly_ (Sept., 1912), and _Nineteenth Century_
(July, 1915); H. Croly, _Promise of American Life_ (1914), is critical.
W.J. Bryan, _First Battle_ (1897), is essential. On La Follette, his
own narrative as given in the _Autobiography_ is best, but should be
read with care as it was written in the heat of partisan controversy.
See also F.C. Howe, _Wisconsin an Experiment in Democracy_ (1912),
friendly to La Follette.

Frank Norris, _The Octopus, and The Pit_; Winston Churchill, _Coniston_
and _Mr. Crewe's Career_; and Upton Sinclair, _The Jungle_, are
illustrative fiction.

       *       *       *       *       *

[1] The shrinkage of the value of these securities caused the "rich
men's panic" of 1903. Consult Noyes, _Forty Years_, 308-311.

[2] The word originated in 1906 with President Roosevelt, who likened
certain sensational journalists to the man with the Muck-Rake in
Bunyan's _Pilgrim's Progress. Annual Register_, 1906, 442.

[3] Cf. pp. 94-96 above.

[4] I have drawn largely at this point upon Dr. W.J. Tucker's article
"The Progress of the Social Conscience" in the _Atlantic Monthly_,
Sept., 1915, 289-303. The clearest idea of the transition from _laissez
faire_ to public interest is gained by reading the biography of M.A.
Hanna by Croly, and La Follette's and Roosevelt's autobiographies.

[5] Usually cases involving the Fourteenth Amendment have also involved
other parts of the Constitution. The main reliance, however, in such
cases has been the Amendment mentioned.




CHAPTER XX


THEODORE ROOSEVELT

Seldom, in times of peace, is the personality of a single individual
so important as that of Theodore Roosevelt during the early years of
the twentieth century. At the time of his accession to the presidency,
he lacked a month of being forty-three years old, but the range of his
experience in politics had been far beyond his age. In his early
twenties, soon after leaving Harvard, he had entered the Assembly of
the state of New York. President Harrison had made him Civil Service
Commissioner in 1889, and he had been successively President of the
Board of Police Commissioners of New York City, Assistant Secretary of
the Navy, an important figure in the war with Spain, and Governor of
New York. He had been known as a young man of promise--energetic,
independent and progressive--and in addition to his political
activities he had found time to write books on historical subjects,
see something of life on a western ranch and develop a somewhat
defective physique into an engine of physical power.

Brimming with energy, nimble of mind, impetuous, sure of himself, quick
to strike, a fearless foe, frank, resourceful, audacious, honest,
versatile--Roosevelt possessed the qualities which would challenge the
admiration of the typical American. One who frequently saw him at work
described thus the way in which he prepared a message to be sent to the
Senate:

    He storms up and down the room, dictating in a loud and oratorical
    tone, often stopping, recasting a sentence, striking out and
    filling in, hospitable to every suggestion, not in the least
    disturbed by interruption, holding on stoutly to his purpose,
    and producing finally, out of these most unpromising conditions,
    a clear and logical statement, which he could not improve with
    solitude and leisure at his command.

The breadth of his interests, the democratic character of his
friendships--for he was equally at home with blue-stocking, politician,
cowboy and artisan--his complete loyalty to his friends and his
disregard of conventionalities gave him a grip upon popular favor that
had not been duplicated since the days of Andrew Jackson, unless by
Lincoln. The effectiveness of so compelling a personality was in no way
diminished by Roosevelt's possession of what a journalist would call
"news sense." He was made for publicity; he had an instinct for the
dramatic. His speeches were removed from mediocrity by his evident
sincerity, his abounding interest in every occasion at which he was
called upon to talk and the phrases that were half victories which he
coined almost at will. "Mollycoddle," "muckraking," "the square deal,"
"the big stick" became familiar idioms in the vernacular of politics
and the street. The political leadership of Roosevelt rested mainly
upon his personal prestige and upon his attributes as a reformer. With
unerring prescience he chose those political issues which would make
a wide appeal and which could be pressed quickly to a successful
conclusion. His complete integrity saved him from mere opportunism; his
ruggedly practical commonsense saved him from that combination of high
purpose and slight accomplishment which has characterized many other
reformers.

No estimate of the deficiencies in Roosevelt's personality and
leadership would be agreed upon at the present time. In some cases--as
in the realm of international relations--only the future can decide
whether he was a prophet or a chauvinist; in all cases, opinions have
differed widely, for Roosevelt could scarcely explore a river, describe
a natural phenomenon or urge a political innovation without thereby
arousing a controversy in which his friends and his opponents would
participate with equal intensity. His identification of himself with
his purposes was as complete as that of Andrew Jackson; opposition to
his proposals was reckoned as opposition to him as an individual. Like
many leaders of the fighting type, he was frequently weak when judging
the motives of those who disagreed with him. One of his admirers
declared that his greatest political defect was an impatience of any
interval between an expressed desire for an act and the accomplishment
of the deed itself--an inability to stand through years of defeat for
the future success of an ideal. A keener and equally sympathetic critic
dubbed him the "sportsman" in politics--honest, hard-hitting, but
playing the issue which had an immediate political effect.

At the outset of his administration Roosevelt was apparently an
adherent of the prevailing Republican creed--protective tariff, gold
standard, imperialism, _laissez faire_ and the rest. His first official
utterance after becoming President was an indication that he would
continue unbroken the policies of his predecessor, and to this end he
insisted that the cabinet should remain intact.[1] His foreign policy
was aggressive; his interest in the military and naval establishments
real and constant. Roosevelt was more venturesome than McKinley, and
more ready to experiment with new ideas. He took up the duties of his
position with an unaffected zest and enthusiasm; he looked upon the
presidential office as an exhilarating adventure in national and even
international affairs. As time went on, therefore, it became more and
more evident that he was prepared to play a big role on a great stage.
Moreover, few doubts concerning the constitutional powers of the
executive position seem ever to have assailed him. Whatever may have
been his theory at the outset of his presidency, he came eventually to
believe that the executive power was limited only by the specific
restrictions and prohibitions appearing in the Constitution, or imposed
by Congress in laws which it had constitutional authority to pass. The
scope which this theory presented for the exercise of his energetic
originality is evident when contrasted with the theory of his
predecessors, who had, in times of peace, held to the belief that the
executive possessed only the powers specifically designated by the
Constitution.

Not until some future time, when the events of the early twentieth
century are better understood, will it be possible to judge accurately
the value of President Roosevelt's regime in its relation to the
control of railroads and corporations. There can be no doubt, however,
that one of the most serious problems that faced the American people
during that time was the position which the government ought to occupy
toward the business interests of the nation. Not only were the
railroads and the great corporations the center of the economic life
of the people, but their social and political effects were momentous.

Neither the Interstate Commerce Act of 1887 nor the Sherman Anti-trust
law of 1890, it will be remembered, had accomplished what had been
expected of them. The Interstate Commerce law had met with grave
obstacles in the courts; the Sherman act had been seldom invoked by the
federal executive, and in the most prominent case, United States _v._
E.C. Knight Co., the government had failed to obtain the decision it
desired. Government regulation seemed like a broken reed.[2] A few
cases, however, had indicated the possibility that strength might be
discovered in the law. In United States _v._ the Trans-Missouri Freight
Association, the Supreme Court had declared that the Anti-trust act
applied to railroads and that it forbade agreements among them to
maintain rates; two years later, in 1899, the Court pronounced illegal
a combination of pipe manufacturers in the Middle West, on the ground
that its result was to restrain interstate commerce.

Roosevelt, like Bryan and La Follette, had been groping his way to an
understanding of the importance of the new problem. During his term as
Governor of New York he had clashed with the older political leaders
when he supported an act looking to the heavier taxation of railway
franchises. The first recommendations in his message to Congress on
December 3, 1901, concerned the subject of the relation of government
and industry. The accumulation of wealth in recent years in the United
States, he asserted, had been due to natural causes, and much of the
antagonism aroused thereby was without warrant. Nevertheless grave
evils had attended the process: overcapitalization was one; untruthful
representations concerning the value of the properties in which
business asked the public to invest was another. Such evils should be
attacked; with extreme care, to be sure, but also with resolution.
Combination and concentration, he thought, should be supervised and,
within reasonable limits, controlled. The remedies which the President
suggested were simple: in the interest of the public the government
should have the right to inspect the workings of organizations engaged
in interstate commerce; because of the lack of uniformity in corporation
legislation within the states, the federal government should so extend
its power as to include supervision of corporations; a Department of
Commerce and Industries should be established, whose head should be a
cabinet officer; the Interstate Commerce law should be amended; railway
rates should be just, and should be the same to all shippers alike, and
the government should be the agent to provide a remedy to this end.

The enthusiastic reception accorded the message by the press indicated
that one or another of its numerous recommendations met with approval.
The effect on Congress, however, of the portion dealing with interstate
commerce was represented by a cartoon in the New York _World_. Uncle Sam
was there portrayed stowing away for later attention a bundle of
manuscript labelled "President's Message 1901. 30,000 words," while he
smilingly remarked "When I git time!" But Roosevelt was not content to
let the matter drop, and in the following summer he took the unusual
step of carrying his message directly to the people. In the New England
states first, and later in the West, he declared his creed on the
federal regulation of industry. The effectiveness of the campaign was
increased by the moderation of the President, by his increasing
popularity and by the many telling phrases, with which he enforced his
main thesis. The Sherman act looked less like a broken reed when the
chief executive of the nation declared: "As far as the anti-trust laws
go they will be enforced ... and when (a) suit is undertaken it will not
be compromised except upon the basis that the Government wins." Here and
there objection was raised that the program was not sufficiently
definite; now and then a critic hazarded a conjecture that Roosevelt had
not consulted the leaders of his party; but in the main he succeeded in
obtaining a sympathetic hearing. At this juncture the coal strike of
1902 gave him one of those fortunate opportunities which were commonly
referred to as a part of "Roosevelt's luck." With no uncertain hand he
seized the opportunity which chance presented.

Before 1899, there had been no organization of the anthracite miners
with sufficient strength to force any changes in the conditions under
which the men performed their work. During that year the United Mine
Workers of America began to send organizers into the Pennsylvania
region. In 1900 the men struck, but an agreement was reached with the
operators and work was resumed. The settlement, however, was not
satisfactory to either side, and in 1902 the workers asked for a
conference. The presidents of the coal companies and the coal-carrying
railroads replied that they were always ready to meet their own
employees but would have no dealings with a general labor organization.
Smaller causes of unrest were the demand for more pay, shorter hours,
and payment for coal by weight instead of by the car, but the
fundamental issue was the recognition of the union--the workmen
insisting on collective bargaining, the operators refusing it. The men
were helpless except as a union; the roads were sure of keeping the
upper hand if they dealt with the men individually or in small groups.
When attempts at conference failed, the miners struck and from May 12
until October 23 nearly 147,000 of them remained idle. The total loss
to miners and operators was nearly $100,000,000.

Since the Pennsylvania fields were almost the sole source of supply
for anthracite coal, discomfort was soon felt in the North and West,
and as the cooler weather came on, suffering became acute and public
feeling bordered on panic. A winter without hard coal could hardly be
contemplated without grave misgivings. Popular opinion, meanwhile,
went increasingly to the side of the miners. The refusal of the
operators to confer, and the propriety of the conduct of the workmen
made a wide impression that was favorable to the union. Moreover,
George F. Baer, President of the Philadelphia and Reading Company,
spoke of himself and his associates in a letter to a correspondent as
those "Christian men to whom God in His infinite wisdom has given the
control of the property interests of the country." The remark was
widely quoted and generally looked upon as evidence of a selfish and
uncompromising individualism.[3] The strike having now become a matter
of national importance, President Roosevelt requested the operators
and representatives of the miners to meet him in Washington, October
3. At this conference the spokesman of the railroads refused mediation,
while the leader of the United Mine Workers, John Mitchell, proposed
arbitration and pledged the workers to accept it.

After the refusal of the operators to accept the President's
conciliatory offer, he decided to apply pressure. He obtained the
consent of Grover Cleveland to act as chairman of a commission of
investigation and determined to seize the mines by military force, if
necessary, operate them as a receiver and await the report of his
commission. In some way, which can not now be indicated with certainty,
the operators were influenced to accept mediation, and the President
appointed a commission with Judge George Gray as chairman.[4] The
miners immediately returned to work, coal began again to flow to the
North, and public rejoicing was extreme. The President's Commission at
once repaired to Pennsylvania, heard 558 witnesses, visited the mines,
and inspected machinery and the homes of the miners. It concluded that
neither side was completely in the right, and therefore made an award
that satisfied some of the complaints of both parties. In the history
of the relation between the federal government and the business
interests of the nation, the anthracite strike of 1902 is of marked
significance. The operators had given evidence of a failure to
understand that their business so concerned the nation that the
interest of the public in it must be heeded. The successful outcome
enhanced the prestige of the government and of the President, and an
example of the need of greater control over corporations received wide
publicity at the precise moment when the general subject was uppermost
in the popular mind.

The first legislative evidence of the result of the agitation for the
more effective regulation of industry was an act approved on February
11, 1903, by which any suit brought in a Circuit Court by the United
States government under the Sherman Anti-trust act or the Interstate
Commerce law, could be given precedence over other cases at the desire
of the Attorney-General. Three days later a law was passed which
established a Department of Commerce and Labor, whose chief was to be a
cabinet officer. Included in the Department was a Bureau of Corporations
headed by a Commissioner, who was authorized to investigate the
organization and conduct of the business of corporations. Within another
five days the Elkins Act had been passed--a law designed to eliminate
rebating. Despite the Interstate Commerce act, the practice of rebating
had continued. Agreement was general that railroad men who, in other
respects, were perfectly scrupulous, commonly violated the law in order
to get business in competition with their rivals. Among the railroad men
who had violated the law but who deprecated the necessity of so doing,
was Paul Morton, president of the Santa Fé system. Morton volunteered to
assist Roosevelt in stamping out the evil, and the Elkins law was
designed to aid in this process. It forbade any variation from published
rates, made both a corporation and its agents punishable for offenses
against the law, prohibited the receiving of rebates as well as giving
them, and made the penalty for failure to observe the provisions of the
Act a fine of one thousand to twenty thousand dollars. Furthermore,
during February, 1903, Congress appropriated $500,000 to be expended
under the direction of the Attorney-General for the better enforcement
of the anti-trust and interstate commerce laws.

In 1903, likewise, was initiated an important judicial proceeding in the
direction of the enforcement of the Sherman law. The Great Northern
Railway Company and the Northern Pacific Railway Company operated
parallel competing lines of road extending from the region of Lake
Superior to the Pacific Coast. An attempted consolidation of the two had
been declared illegal under the statutes of the state of Minnesota. On
November 13, 1901, under the leadership of two of the foremost railway
magnates of the nation, J.J. Hill and J.P. Morgan, there had been
organized the Northern Securities Company, to purchase and control at
least a majority of the shares of the capital stock of the two lines of
railway. In this way the two roads would be operated as one, their
earnings pooled, competition between the two eliminated and a virtual
consolidation effected. On the advice of the Attorney-General, Philander
C. Knox, President Roosevelt directed that proceedings be instituted
against the holding company--an act that seemed almost useless in view
of the decision of the Supreme Court in the Knight Case. But the
decision in the Northern Securities Case, handed down in 1904, was a
surprise. By a vote of five to four the Court declared the company a
combination in restraint of trade, and therefore illegal under the
Sherman act, and enjoined any attempt on its part to control the affairs
of either of the two railways.

Nineteen hundred and four, the year of the presidential election, found
Roosevelt in a strong position. His success in handling the coal strike
and his energetic preparations for the crusade against trust evils had
struck a responsive chord in the popular mind. Late in 1903 he had
announced to Congress that frauds had been discovered in the post
office and land office, and urged the appropriation of funds for the
prosecution of the offenders. The result was a house-cleaning which
involved the conviction of many officials, including two United States
senators. Roosevelt's popularity became greater than ever.

It was to be expected, however, that some opposition would appear to the
nomination of Roosevelt for a continuation of his term of office, and it
was around the forceful Mark Hanna that the opposition began gradually
to center. Hanna had attained remarkable influence as a senator, was
highly trusted by the business interests and was popular among southern
Republicans. But his death in February, 1904, effectively ended any
opposition to Roosevelt, since it was then too late to focus attention
upon any other competitor. The Republican nominating convention,
therefore, which met in Chicago on June 21, lacked any semblance of a
contest, and the President was renominated without opposition. The
platform was of the traditional sort. The history of the party was
approved; its achievements in giving prosperity to the country and
peaceful government to the island possessions were recounted; the
protective tariff, the gold standard, an isthmian canal, the improvement
of the army and navy, the continuation of civil service reform and a
vigorous foreign policy,--on all these the party utterance was that of
other days. Surprisingly little was said upon the subject of the
regulation of corporations. The few steps already taken were approved,
but as to the future, the platform was almost colorless:

    Combinations of capital and of labor are the results of the
    economic movement of the age, but neither must be permitted to
    infringe upon the rights and interests of the people. Such
    combinations, when lawfully formed for lawful purposes, are
    alike entitled to the protection of the laws, but both are
    subject to the laws, and neither can be permitted to break them.

The Democratic convention met in St. Louis on July 6, and the
excitement which marked its proceedings compensated for the lack of
interest at the Republican meeting. As drawn up by a sub-committee of
the Committee on Resolutions, the platform was, in many of its planks,
a distinct return to the programs of the days before 1896. It urged a
reduction of the tariff, generous pensions and civil service reform,
together with the enforcement of the anti-trust laws and the popular
election of senators. In the main, it was devoted to a condemnation
of the existing Republican administration, which it denounced as
"spasmodic, erratic, sensational, spectacular and arbitrary." It also
contained a paragraph declaring that the question of the money standard
had ceased to be an issue, on the ground that recent discoveries of
gold had enormously increased the supply of currency in the country.
Bryan did not approve. With characteristic energy he threw himself into
an all-night fight in the Committee in behalf of a silver plank. His
defeat indicated that the convention was in the hands of his opponents
and the platform as adopted contained no reference to the currency.

The delegates had, in fact, come to the meeting with the distinct
purpose of returning to the "safe and sane" democracy of Grover
Cleveland. To that end, the platform was to drop the silver issue and
Bryan was to be replaced by a more conservative leader. The radical
forces centered their strength upon William R. Hearst, but they were in
a distinct minority, and in the end, the Cleveland wing succeeded in
nominating Judge Alton B. Parker of New York. As soon as he was
notified of his nomination, Judge Parker telegraphed to the convention
that he regarded the gold standard as irrevocably established and that
he must decline to be the party candidate if his attitude on the
currency was unsatisfactory to the delegates. Thereupon the convention
replied that the platform was silent on the question of a monetary
standard because it was not regarded as a campaign issue. Parker was
satisfied with the reply, and the last word was written upon a question
that had disturbed politics for many years.

The succeeding campaign was unusually listless. Parker did not inspire
enthusiasm, although a man of undoubted integrity and ability, and the
personality of Roosevelt was the controlling force. Only at the close
of the canvass did a passing interest appear in some charges made by
Parker. He called attention to the fact that Secretary Cortelyou of the
Department of Commerce and Labor had been charged with the duty of
examining the acts of corporations and had then resigned to become
chairman of the National Republican Committee. Parker insinuated that
Cortelyou was using information about corporate misdoing, which he had
discovered, in order to force large contributions from the business
interests. He also declared that the Republican campaign was being
financed by the corporations. Roosevelt did not answer the charges
until three days before the election, and then he asserted that the
statements made by Parker were "unqualifiedly and atrociously false."
Later investigations have shown that in general Parker was correct in
his complaint as to the activities of the corporations, although he
would have found difficulty in proving his charges in detail. The same
investigations, however, indicated that some of the Democratic campaign
fund had come from similar sources.

[Illustration:
Election of 1904 by Counties]

The election resulted in the choice of President Roosevelt, whose
popular vote was 7,600,000 to Parker's 5,000,000. In the more populous
sections of the country, which were normally Republican, the party vote
scarcely exceeded that of 1900, but in the Far West, the increases were
notable. Beyond the Mississippi River, except in the southern states,
hardly a county gave a majority for Parker, showing that the region
which had gone to Bryan in 1896 was substantially solid for Roosevelt.
Indeed, the policies to which Roosevelt was committed bore a greater
resemblance to the principles of Bryan than to the _laissez faire_
philosophy to which many important Republican leaders adhered. Despite
their dissent, however, his victory in the election was so overwhelming
that he could carry out his program with the irresistible pressure of
public opinion behind him.

During the campaign year, the Commissioner of Corporations was busy
investigating the activities of the so-called "beef-trust," and a suit
against the combination was pressed to a successful conclusion in
January, 1905. In its decision in the case (Swift & Company _v._ United
States), the Supreme Court dwelt at some length on the charges made
against the Company. A dominant proportion--six-tenths--of the dealers
in fresh meat in the United States were alleged to have agreed not to
bid against one another in the live-stock markets; to restrict the
output of meat in order to raise prices; to keep a black-list; and to
get illegal rates from the railroads to the exclusion of competitors.
To the objection of the members of the trust that the charges against
them were general and did not set forth any specific facts, the Court
retorted that the scheme alleged was so vast as to present a new
problem in pleading. The decision was against the combination, which
was ordered to dissolve. The publicity given to the case and to the
methods of the meat packers assisted in the passage of legislation
requiring government inspection of meats.

An unexpected phase of the Sherman act appeared in 1908, in the case
Loewe _v._ Lawlor. The American Federation of Labor, acting through its
official organ, had declared a boycott against D.E. Loewe, a hat
manufacturer of Danbury, Connecticut. The Court decided that a
combination of labor organizations designed to boycott a dealer's goods
was a combination in restraint of trade and that the manufacturer might
maintain an action against the Hatters' Union for damages.[5]

In the meantime, another prominent trust had played into the hands of
the administration. The American Sugar Refining Company imported large
amounts of raw sugar, on which it paid tariff duties. In November,
1907, it was discovered that the Company had tampered with the scales
on which the incoming sugar was weighed, in such a manner as to defraud
the government. In the resulting legal actions, over $4,000,000 were
recovered from the Company, criminal prosecutions were carried on
against the officials and employees, and several of them were
convicted. The close relation between the railroads and the great
corporations was indicated when the Standard Oil Company of Indiana was
brought into court on the charge of receiving rebates on petroleum
shipped over the Chicago and Alton Railroad. The decision by Judge K.M.
Landis was that the Company was guilty on 1,462 separate counts and
must pay a fine of $29,240,000. On appeal to a higher court the case
was dismissed, partly on a question concerning the meaning of the law.

The efforts of Roosevelt in the direction of control of the railroads
resembled his activities in relation to industrial combinations. A
variety of circumstances had combined to arouse a popular demand for
the reinforcement of existing legislation: the discovery of grave
abuses in connection with the transportation of petroleum; the
continuance of favoritism and rebating, together with increasing public
knowledge of their existence; the rise in freight rates; and the
consolidation of the railroads into a few large systems, with the
accompanying concentration of power in the hands of a small number of
persons. In his public speeches and in his messages to Congress in 1904
and 1905, President Roosevelt made himself the spokesman of the popular
will. In particular--and it was here that the conflict was destined to
rage--the President called for the transfer to the Interstate Commerce
Commission of the power to determine the rates which the roads should
be allowed to charge. The project was not a new one, having already
taken shape in previous years, but at no time was Congress prepared to
pass definite legislation. The reaction of the railroads to the rising
demand was energetic. A costly propaganda was entered upon designed to
prove to the public that the roads should be let alone. A powerful
lobby worked insistently upon Congress, first to prevent action and
later, when action was seen to be inevitable, to weaken the legislation
wherever possible. The railroad's campaign of popular education,
however, helped to convince the popular mind that new laws were needed,
and came coincidently with the disclosures of corporate mismanagement
and wrong-doing. The outcome was the Hepburn Act of June 29, 1906.

Its major provisions were five in number. It enlarged the scope of the
Interstate Commerce Act so as to include control of express and
sleeping car companies, pipe lines, switches, spur tracks and
terminals. Free passes, which had hitherto been productive of much
favoritism and the source of political corruption, were strictly
forbidden, except to a few specified classes. The "commodity clause"
forbade railroads to carry goods, other than timber, in which they had
an interest, except such as they were going to use themselves. This
provision was designed mainly to check the activities of those
companies which owned both coal mines and railroads, and which used
their advantageous position to crush independent operators. Its force,
however, was largely nullified by subsequent decisions of the courts.
The Hepburn law also enabled the Commission to prescribe the methods of
book-keeping which the roads must follow, to call for monthly or
special reports and to employ examiners who should have access to the
books of the carriers. The roads were even denied the right to keep any
records except those approved by the Commission. These drastic features
of the law were due in part to the practices of certain roads which hid
away corrupt expenditures in their accounts in such a manner that
detection was almost impossible. Most important, however, among the
provisions of the Act was that in relation to rate-making, which not
only empowered the Commission to hear complaints that rates were unjust
or unreasonable, but even enabled it to determine what would be a just
and reasonable charge in the case, and to order the carrier complained
of to adhere to the new rate. The rate-making section of the Hepburn
Act immediately resulted in a large increase in the number of
complaints entered by shippers against the carriers. Previously, few
cases had been taken to the Commission--only 878 in eighteen
years--because relief was seldom obtained and then only at great cost
in time and money. Under the new law more than 1500 cases were entered
within two and a half years, and several thousand others were
informally settled out of court.

The example of the federal government in adopting restrictive railway
legislation was followed by the states, on a nation-wide scale. Hours
of labor were regulated, liability for accidents defined, railroad
commissions given larger powers, and freight and passenger rates
determined. The result was a tangle of local regulations, many of which
were designed to embarrass the roads and others of which were passed
with slight knowledge of the practical questions involved.

Aside from his connection with the anti-trust campaign and the movement
for railroad regulation, Roosevelt's most significant activities during
his second administration related to conservation. As early as 1880 the
Superintendent of the Census had called attention to the exhaustion of
the best public lands. The truth of his assertion had been exemplified
in the rush of settlers to Oklahoma when the former Indian Territory
was opened to settlement on April 22, 1889. At noon on that day the
blast of a cavalry bugle was the signal that any settler might enter
and stake out his claim. On foot, on fleet horses, in primitive wagons,
an excited, jostling mob rushed toward those lands that seemed most
desirable. Trains were crowded to the roofs; tools, furniture, and
portable houses were carried in from Texas, Nebraska and Kansas. By
nightfall a stretch of waving prairie became Gruthrie, with a
population of 10,000 persons; by the evening of the first day Oklahoma
possessed a population of 50,000; twenty years later it had over a
million and a half, contained flourishing cities, many public
enterprises, and a beautiful state university.

The fact that desirable land was becoming so rare called attention to
the waste and dishonesty in connection with our public land system. In
his annual report for 1884 the Secretary of the Interior had complained
that large amounts of land had been acquired under fictitious names or
by persons employed for the purpose. Their holdings were then passed
over to speculators who retained huge areas for a rising market.
Railroads had kept lands granted to them, without fulfilling the
conditions of the grants. Titled Englishmen and English land companies
had gained control of tracts of unbelievable size, one of them being
estimated at 3,000,000 acres. The history of the disposal of the public
land had almost been duplicated in the history of the forest-bearing
public domain, except that measures had earlier been taken to conserve
the remnant of the once magnificent supply of standing timber. An act
of 1891 had enabled the president to set apart as public reservations
any lands bearing forests. All the presidents, from Harrison down, had
availed themselves of their power, and had established great numbers of
reservations, most of them in states west of the Mississippi.[6]

A few far-sighted individuals had long urged caution in the disposal of
the public resources. Some beginnings in fact had already been made in
the Division of Forestry in the Department of Agriculture, where
Clifford Pinchot was actively interested in forest preservation. In
1901 and later his functions had been expanded, and the forestry
service had taken up protection against fire, the sale of timber, and
reforestation. In 1907 President Roosevelt appointed a commission to
study the inland waterways, which after careful investigation
recommended a convention for the discussion of conservation problems.
Thereupon the President invited the governors of the states to
Washington for a conference, at which conservation questions were
thoroughly discussed. The resulting recommendations composed a
complete, although general plan of reform: the natural resources of the
country to be used for the prosperity of the American people;
reclamation of arid lands; conservation of forests, minerals and
water-power; the protection of the sources of the rivers; and
cooperation between Congress and the states in developing a
conservation program. A National Conservation Commission was later
appointed which coordinated the work of organizing the movement, and
made an exhaustive inventory of the nation's natural resources.

The conservation movement also called attention to the possibilities of
the arid region between the western parts of Kansas, Nebraska and the
Dakotas, and the eastern border of California. Within this vast area
were large tracts of land that would be fertile if sufficiently
supplied with water. The most important legislation in a series of acts
designed to meet this need was the Reclamation Act of 1902. Under its
provisions the federal government set aside the proceeds of the sale of
public land in sixteen states and territories as a fund for irrigation
work. With the resources thus obtained, water powers were developed,
reservoirs built and large tracts supplied with water. Private
companies and western states also carried out numerous projects. The
Department of Agriculture after its establishment in 1889 also
conducted many undertakings which, in effect, were conservation
enterprises. It helped educate the American farmer in scientific
methods, sought new crops in every corner of the globe, discovered and
circulated means of combating diseases and insects, studied soils,
distributed seeds and gathered statistics. In the arid and semi-arid
regions the discovery of dry farming was of great value. This consists
of planting the seed deep and keeping a mulch of dust on the surface by
frequent cultivation, in order to retard the evaporation of the
moisture in the ground underneath.[7]

Nothing can be more apparent than the complete change of position which
was brought about during the eight years after the death of President
McKinley. At the end of that period, both the industrial corporations
and the railways were on the defensive, and the public had secured the
whip hand. Industry, especially the railroads, was tamed and
hobbled--some thought, crippled. Many factors contributed to the
revolution. President Roosevelt was its most active agent, to be
sure,--its "gigantic advertiser" and popularizer. But it could hardly
have taken place--at least at the time and in the way it did--without
the great upheaval of 1896, without the publicity which the "muck-rake"
magazines and daily newspapers were able to offer, without the
industrial consolidations of 1898 and later, and without the refusal of
industry and the railways to obey earlier and less drastic laws, and
their skilled and insistent attempts to find loop-holes in legislation.

From the standpoint of politics, the effect of the Roosevelt
administrations was notable. As has been seen, the Republican party had
become largely the party of the business and commercial classes,
conservative and unyielding to the new demands of the late nineteenth
century. Its leadership had been sharply challenged by the forces of
unrest in 1896. On an issue other than a monetary one, the success of
Bryan would have been possible. The failure of the attempt to get
control of the federal government in the interest of the Populist
program was only a temporary defeat, for the revival of unrest,
although checked by the war with Spain, was sure soon to reappear. In
President Roosevelt, the forces of discontent, especially in the Middle
and Far West, saw their hoped-for champion, and their support of him
was instant and complete. The dominant leadership and much of the rank
and file of the Republican party had become liberal. The situation was
anomalous, however, for no great political party can experience a
thorough-going change of philosophy in a few years. Only the future,
therefore, could tell whether the newer and more liberal element would
continue to control the party, or whether a reaction against its
leadership would take place.


BIBLIOGRAPHICAL NOTE

It is too early to expect a biography of Roosevelt which is informed
and critical, as well as sympathetic. The keenest judgment is to be
found in _Atlantic Monthly_ (CIX, 577), "Mr. Roosevelt." The following
are also available: L.F. Abbott, _Impressions of Theodore Roosevelt_
(1919); F.E. Leupp, _The Man Roosevelt_ (1904); W.R. Thayer, _Theodore
Roosevelt_ (1919); C.G. Washburn, _Theodore Roosevelt; the Logic of His
Career_ (1916). Roosevelt can be partly understood through a critical
reading of his writings, especially his _Addresses and Presidential
Messages_ (1904), and his _Autobiography_ (1913).

On the coal strike consult the _Autobiography_, and _Senate Reports_,
58th Congress, special session, Document No. 6 (Serial Number 4556),
the report of the President's Commission. The election of 1904 is
discussed in Latané, Croly and Stanwood: see also C.M. Pepper, _The
Life and Times of Henry Gassaway Davis_ (1920). The new railroad acts
are well discussed in W.Z. Ripley, _Railroads: Rates and Regulations_
(1912), and by F.H. Dixon in _Quarterly Journal of Economics_, XXI, 22.

The literature of conservation is very large. An excellent single
chapter is in Katherine Coman, _Industrial History of the United
States_ (rev. ed., 1910); C.R. Van Hise, _The Conservation of Natural
Resources in the United States_ (1913), is a standard work; R.P. Teele,
_Irrigation in the United States_ (1915), is detailed; for documents
concerning the conference of governors, _House of Representatives
Document_ No. 1425, 60th Congress, 2nd session (Serial Number 5538).

The anti-trust campaign is best followed in Theodore Roosevelt,
_Addresses and Presidential Messages_, and in the _Autobiography_. The
Northern Securities decision is in _United States Reports_, vol. 193,
p. 197.

       *       *       *       *       *

[1] In view of the later activities of President Roosevelt, there is
point in the remark of a satirist that Roosevelt did carry out the
policies of McKinley--and bury them. _Atlantic Monthly_, CIX, 164.

[2] Above, p. 257.

[3] It was later denied that Baer made the statement, but a
photographic copy of the letter was printed in Lloyd, _Henry D. Lloyd_,
II, 190. See also Mitchell, _Organized Labor_, 384; Peck, _Twenty
Years_, 693-6.

[4] Rumor says that Roosevelt sent Elihu Root to the eminent financial
magnate, J.P. Morgan, with information of his intent to appoint the
Cleveland Commission, and that Morgan applied the pressure to the coal
operators.

[5] In 1917, fourteen years after Loewe's first suit, he recovered
damages from the Union.

[6] In 1918, 151 national forests aggregated 176,000,000 acres.
Secretary of the Interior, _Annual Report_, 1918, 61.

[7] The territory of Alaska contains immense stores of natural resources
which are being conserved with more wisdom than characterized the
disposal of our continental supplies. The area of the territory,
586,400 square miles, constitutes a, kingdom. It has uncounted wealth in
fish, furs, timber, coal and precious metals. At present the federal
government is building a railroad which will tap some of the resources
of the region. _Enc. Brit._, "Alaska."




CHAPTER XXI


POLITICS, 1908-1912

By 1908, the year of the presidential election, an influential portion
of the Republican members of Congress, particularly in the Senate, were
bitterly opposed to President Roosevelt. His attitude on the trusts and
the railroads was offensive to many, and on several occasions he had
gained the upper hand over Congress by means which were coming to be
known as "big-stick" methods. The so-called "constructive recess" of
1903 was an example.

Under the provisions of the Constitution, the president appoints many
officials with the advice and consent of the Senate, when it is in
session, and fills vacancies that happen during a recess by granting
commissions which expire at the end of the next session. On December 2,
1903, at noon, one session of Congress came to an end and another began.
Precisely at 12 o'clock, according to the official statement, the
President issued new commissions to W.D. Crum, a negro, to be collector
of the port of Charleston, and also to 168 army officers, of whom the
President's close friend Brigadier-General Leonard Wood was one. General
Wood was to be promoted to a major-generalship and the remaining
promotions were dependent upon his advance. The President's theory was
that a "constructive recess" intervened between the two sessions, during
which he could make recess appointments. Although the Senate was hostile
to both Crum and Wood, it reluctantly succumbed to Roosevelt's wishes
rather than withhold promotion from the 167 officers to whom it had no
objection.

In 1908, Senator Tillman, an outspoken Democratic critic of the
President, declared that senators vigorously denounced Roosevelt's
radical ideas in private but that in public they opposed merely by
inaction. Party loyalty was sufficient to keep these Republicans, in
most cases, from open and continued rebellion. Hardly less hostile to
the President were many of the business men of the country, who objected
to his economic policies, but the only alternative to Roosevelt was
Bryan, who, as one of the earliest proponents of radical legislation,
was even more offensive. On the other hand, a large majority of the rank
and file of the party, especially in the North and West, upheld the
President with unfeigned enthusiasm and made his position in the party
so strong that he could practically name his successor. Several
candidates had more or less local support for the nomination--Senator
Knox, of Pennsylvania, Governor Hughes, of New York, Speaker Cannon, of
Illinois, Vice-President Fairbanks, of Indiana, Senator La Follette, of
Wisconsin and Senator Foraker, of Ohio. The President's prestige and
energy, however, were frankly behind the candidacy of his Secretary of
War, William H. Taft.

The Republican convention of 1908 met in Chicago on June 16. Early in
the proceedings the mention of Roosevelt's name brought an outburst of
enthusiasm which indicated the possibility that he might be nominated
for a third term, despite his expressed refusal to allow such a move to
be made. In the platform the achievements of the retiring administration
were recounted in glowing terms; tariff reform was promised; and a
postal savings bank, the strengthening of the Interstate Commerce law
and the Sherman Anti-trust act, the more accurate definition of the
rules of procedure in the issuance of injunctions, good roads,
conservation, pensions and the encouragement of shipping, received the
stamp of party approval. Planks pledging the party to legislation
requiring the publicity of campaign expenditures, the valuation of the
physical property of railroads and the popular election of senators were
uniformly rejected. The closing paragraph declared that the "trend of
Democracy is toward Socialism, while the Republican party stands for
wise and regulated individualism." The contest over the nomination was
extremely brief, as Taft received 702 out of 979 votes on the first
ballot. James S. Sherman of New York was nominated for the
vice-presidency.

The Democrats, meanwhile, were in a quandary. A considerable fraction of
the party desired the nomination of somebody other than Bryan, whose
defeats in 1896 and 1900 had cast doubts upon the wisdom of a third
trial. Nevertheless the failure of Parker in 1904 had been so
overwhelming that the nomination of a conservative seemed undesirable
and, moreover, no candidate appeared whose achievements or promise could
overcome the prestige of Bryan. The national convention was held in
Denver, July 7-10, and Bryan dominated all its activities. The platform
welcomed the Republican promise to reform the tariff, but doubted its
sincerity; promised changes in the Interstate Commerce law, a more
elastic currency, improvements in the law of injunctions, generous
pensions, good roads and the conservation of the national resources. In
the main, however, the platform was an emphatic condemnation of the
Republican party as the party of "privileges and private monopoly." It
declared that the Republican speaker of the House of Representatives
exercised such absolute domination as to stop the enactment of measures
desired by the majority. It demanded the termination of the "partnership
which has existed between corporations of the country and the Republican
party," by which the business interests contributed great sums of money
in elections in return for an unmolested opportunity to "encroach upon
the rights of the people." It promised the enactment of laws preventing
corporation contributions to campaign funds and providing for the
publication before election of all contributions by individuals.
Detailed and definite planks in relation to trusts indicated that the
framers of the platform possessed at least the courage of their
convictions. Three laws were promised: one preventing the duplication of
directors among competing corporations; another establishing a license
system which would place under federal authority those corporations
engaged in interstate commerce which controlled as much as twenty-five
per cent. of the product in which they dealt, and which should likewise
protect the public from watered stock and prohibit any single
corporation from controlling over fifty per cent. of the total amount of
any commodity consumed in the United States; and, third, a law forcing
corporations to sell to purchasers in all sections of the country on the
same terms, after making due allowance for transportation costs.

As soon as the platform was out of the way, the convention turned to the
nomination of the candidate. Only George Gray, of Delaware, and John A.
Johnson, of Minnesota, contested the leadership of Bryan, but their
support was so slight that he was chosen on the first ballot. John W.
Kern, of Indiana, was nominated for the vice-presidency.

Of the smaller parties which shared in the election of 1908, the
People's party and the Socialists should be mentioned. The Populists
adopted a program of economic reforms many parts of which had been
prominent in their platforms of 1892 and 1896. Both the Republicans and
the Democrats, however, had adopted so many of these earlier demands
that the Populists rapidly lost strength and disappeared after 1908. The
Socialists likewise advocated economic reforms, together with government
ownership of the railroads, and of such industries as were organized on
a national scale. The candidate nominated was Eugene V. Debs, a labor
leader who had gained prominence at the time of the Pullman strike.[1]

The only novelty in the campaign was Bryan's stand in regard to campaign
funds. By calling upon his supporters for large numbers of small
individual contributions, he drew attention to the fact that the
corporations were helping generously to meet Taft's election expenses.
At their leader's direction the Democratic committee announced that it
would receive no contributions whatever from corporations, that it would
accept no offering over $10,000 and that it would publish a list of
contributors before the close of the campaign.

The result of the election was the triumph of Taft and his party. The
Republican popular vote was 7,700,000; the Democratic, 6,500,000; the
Socialist, 420,890. The election also gave the Republicans control of
Congress, which was to be constituted as follows during 1909-1911:
Senate, Democrats, 32, Republicans, 61; House of Representatives,
Democrats, 172, Republicans, 219.

Few men in our history have had a wider judicial and administrative
experience before coming to the presidency than that of William H. Taft.
He was born in 1857 in Ohio, graduated from Yale University with high
rank in the class of 1878 and later entered upon the study of law. A
judicial temperament early manifested itself and Taft became
successively judge of the Superior Court in Cincinnati and of a United
States Circuit Court. From the latter post he was called to serve upon
the Philippine Commission, was later Governor of the Philippines and
Secretary of War in Roosevelt's cabinet. During the period of his
connection with the Philippines and his membership in the Cabinet he
visited Cuba, Panama, Porto Rico, Japan and the Papal Court at Rome in
connection with matters of federal importance.

Personally Taft is kindly, unaffected, democratic, full of good humor,
courageous. As a public officer he was slow and judicial, rather than
quick and executive like his predecessor. Although in sympathy with the
reforms instituted by Roosevelt, Taft was less the reformer and more
conscious of considerations of constitutionality. Roosevelt thought of
the domain of the executive as including all acts not _specifically
forbidden_ by the Constitution or by the laws of the nation; Taft
thought of it as including only those which were _specifically granted_
by the Constitution and laws. The one was voluble, a dynamo of energy,
quick to seize and act upon any innovation that gave promise of being
both useful and successful; the other thought and acted more slowly and
was less sensitive to the feasibility of change. One possessed well-nigh
all the attributes necessary for intense popularity; the other inspired
admiration among a smaller group. Roosevelt had a peculiarly keen
perception of the currents of public opinion, enjoyed publicity and knew
how to achieve it; Taft was less quick at discovering the popular thing
and less adept at those tricks of the trade that heightened the
popularity of his predecessor.

Despite the patent differences of temperament and philosophy between
Taft and Roosevelt, both expected that the new administration would be
an extension of the old one. Roosevelt indicated this in his frank
preference for Taft as his successor; Taft indicated it in his thorough
acceptance of the policies of the preceding seven years and in his
intention, expressed at the time of his inauguration, to maintain and
further the reforms already initiated. His first act, however, the
appointment of his official advisors, caused some surprise among the
friends of his predecessor who expected that he would retain most if not
all of the Roosevelt cabinet. When he did not do so, it seemed as if the
attempt to further the Roosevelt policies would lack continuity.[2]

The immediate problem that faced the new executive was the revision of
the tariff. The task was one which has frequently resulted in political
disaster, but the platform left no choice to the President:

    The Republican party declares unequivocally for a revision of the
    tariff by a special session of Congress immediately following the
    inauguration of the next President.... In all tariff legislation the
    true principle of protection is best maintained by the imposition
    of such duties as will equal the difference between the cost of
    production at home and abroad, together with a reasonable profit to
    American industries.

The precise meaning of this declaration will perhaps always remain a
matter of dispute, although it is certain that the public in general
understood it to mean a distinct lowering of the tariff wall, and Taft
committed himself to downward revision in his inaugural address.
Moreover, whether it was intended by the framers to commit the party
to downward revision or not, the method of defining the amount of
protection to be granted was both novel and unsatisfactory, as
Professor Taussig has pointed out. How could the costs of production
at home or abroad be determined? To what extent would the principle
announced in the platform be carried? Almost any commodity can be
produced almost anywhere if the producer is guaranteed the cost of
production, together with a reasonable profit. The wise revision of
the tariff is difficult enough under any circumstances; under so vague
a theory as was proposed in 1908, the chances of success became
remote.

The drafting of the tariff bill proceeded in the usual manner. The
Ways and Means Committee of the House, the chairman of which was
Sereno Payne, held preliminary public "hearings," which were open to
any who desired to offer testimony or make requests. Naturally,
however, the great body of the consuming public was little
represented; most of those who appeared were manufacturers, importers
and other interested parties. The bill drawn up by the Committee and
passed by the House revised existing duties, on the whole, in the
downward direction. The Senate Finance Committee, however, under the
leadership of Nelson W. Aldrich, an experienced and able proponent of
a high protective tariff, made 847 amendments, many of them important
and generally in the direction of higher rates. The Senate, like the
House, contained several Republicans, usually called "insurgents," who
were inclined to break away from certain of the party doctrines.
Senators Bristow, Cummins, Dolliver and La Follette were among them.
This contingent had hoped for a genuine downward revision, and when
they saw that the bill was not in accord with their expectations, they
prepared to demand a thorough debate. Each of the insurgents made an
especial study of some particular portion of the proposed measure so
as to be well prepared to urge reductions. Their efforts were
unavailing, however, and the bill passed--the insurgents voting with
the great majority of the Democrats in the negative. The bill then
went to a conference committee. Up to this point, the President had
taken little share in the formation of the bill. Yet as leader of the
party he had pledged himself to a downward revision and the result
seemed likely not to be in the promised direction. He therefore
exerted pressure on the conference committee and succeeded apparently
in getting some reductions, chiefly the abolition of the duty on
hides. The bill was then passed by both houses and signed by the
President on August 5, 1909.

The question whether the Payne-Aldrich act redeemed the pledge
embodied in the platform of 1908 will doubtless remain a debatable
question. On the one hand, a prominent Republican member of the
Committee on Ways and Means and of the Conference Committee, declared
that the act represented the greatest reduction that had been made in
the tariff at any single time since the first revenue law was signed
by George Washington. Roosevelt also defended the act. Experts outside
of Congress sharply differed. Professor Taussig analyzed the act in
all its aspects and concluded that no essential change had been made
in our tariff system. "It still left an extremely high scheme of
rates, and still showed an extremely intolerant attitude on foreign
trade." General public opinion was most affected by the fact that
duties on cotton goods were raised, and those on woolen goods left at
the high rates levied under the Dingley act. It also appeared that
many silent influences had been at work--the duty on cheap cotton
gloves, for example, being doubled through the efforts of an
interested individual who procured the assistance of a New England
senator.[3]

Not long after the passage of the act President Taft defended it in a
speech at Winona, Minnesota, as the best tariff bill that the
Republican party had ever passed. In regard to the woolen schedule he
frankly said:

    Mr. Payne in the House, and Mr. Aldrich, in the Senate, although
    both favored reduction in the schedule, found that in the Republican
    party the interests of the wool growers of the Far West and the
    interests of the woolen manufacturers in the East and in other
    States, reflected through their representatives in Congress, were
    sufficiently strong to defeat any attempt to change the woolen
    tariff and that, had it been attempted, it would have beaten the
    bill reported from either committee.... It is the one important
    defect in the present Payne tariff.

The response of the press and the insurgent Republicans to the passage
of the bill and to the Winona speech were ominous for the future of the
party. Although not unanimous, condemnation was common in the West,
even in Republican papers. Particular objection was made to the high
estimate which the President placed upon the act and to his defence of
Senator Aldrich, who had come to be looked upon as the forefront of the
"special interests"; and western state Republican platforms in 1910
declared that the act had not been in accord with the plank of 1908.[4]

Coincidently with the disagreement over the Payne-Aldrich act, there
raged the unhappy Pinchot-Ballinger controversy. One of the last acts
of President Roosevelt had been to withdraw from sale large tracts of
public land which contained valuable water-power. The purpose and the
effect of the order was to prevent these natural resources from falling
into private hands and particularly into the hands of syndicates or
corporations who would develop them mainly for individual interests.
President Taft's Secretary of the Interior, Richard A. Ballinger, took
the attitude that the withdrawals were without statutory justification
and he therefore revoked the order for withdrawals immediately after
coming into office. Upon further investigation, however, he re-withdrew
a part of the land, although somewhat doubtful of his power to do so.

During the summer of 1909, Gifford Pinchot, the Chief Forester,
addressed an irrigation Congress in Spokane and asserted that the
water-power sites were being absorbed by a trust. Much interest was
aroused by the charge, which was looked upon as an attack on the
Secretary of the Interior and his policy. Within a short time the idea
became widespread, through the press, that Ballinger was associated
with interests which were desirous of seizing the public resources and
that this fact lay back of his partial reversal of the policy of his
predecessor. This impression was deepened by the charges of L.R.
Glavis, an employee of the Department of the Interior, concerning the
claims of a certain Clarence Cunningham, representing a group of
investors, to some exceedingly valuable coal lands in Alaska. Glavis
asserted that the Cunningham claims were fraudulent, that many of the
Cunningham group were personal friends of Ballinger and that the latter
had acted as attorney for them before becoming Secretary of the
Interior. President Taft, with the backing of an opinion from
Attorney-General Wickersham, upheld Ballinger and dismissed Glavis. The
press again took the matter up and the controversy was carried into
Congress, where an investigation was ordered. About the same time
Pinchot was removed for insubordination, and additional heat entered
into the disagreement. The majority of the congressional committee of
investigation later made a report exonerating Ballinger, but his
position had become intolerable and he resigned in March, 1911. The
result of the quarrel was to weaken the President, for the idea became
common that his administration had been friendly with interests that
wished to seize the public lands.

Republican complaint in regard to the tariff and the Pinchot-Ballinger
controversy were surface indications of a division in the party into
conservative or "old-guard," and progressive or insurgent groups. The
same line of demarcation appeared in a quarrel over the power of the
Speaker of the House of Representatives, Joseph G. Cannon. Cannon had
served in the lower branch of Congress almost continuously for
twenty-seven years, and in 1910 was filling the position of speaker for
the fourth consecutive time. Much of his official influence rested on
two powers: he appointed the committees of the House and their
chairmen, a power which enabled him to punish opponents, reward friends
and determine the character of legislation; and he was the chairman and
dominant power of the Committee on Rules which determined the procedure
under existing practice and made special orders whenever particular
circumstances seemed to require them. It was widely believed that
Cannon, like Aldrich in the Senate, effectually controlled the passage
of legislation, with slender regard to the wishes or needs of the
people. "Cannonism" and "Aldrichism" were considered synonymous. For
several years an influential part of the Republican and Independent, as
well as the Democratic press had attacked Speaker Cannon as the enemy
of progressive legislation. Many of them laid much of the blame for the
character of the Payne-Aldrich act at his door. _The Outlook_ decried
"government by oligarchy"; _The Nation_ declared that he belonged to
another political age; Bryan queried what Cannon was selling and how
much he got; Gompers, the head of the American Federation of Labor,
pointed him out as the enemy of all reforms.

The outcry against the Speaker in the House itself, reinforced by the
gathering opposition outside, found effective voice in a coalition of
the Democrats and the insurgent Republicans. In mid-March, 1910, an
insurgent presented a resolution designed to replace the old Committee
on Rules by a larger body which should be elected by the House, and on
which the speaker would have no place. The friends of Cannon rallied to
his defence; other business fell into the background; and debate became
sharp and personal. One continuous session lasted twenty-six hours,
parliamentary fencing mingling with horse-play while each side
attempted to get a tactical advantage over the other.[5] Eventually
about forty insurgent Republicans joined with the Democrats to pass the
resolution. The result of the change was to compel the speaker to be a
presiding officer rather than the determining factor in the passage of
legislation. About the time that Cannon's domination in the House was
being broken, the announcement that Senator Nelson W. Aldrich and his
staunchly conservative associate, Eugene Hale, of Maine, were about to
retire indicated a similar change in the Senate. These men had served
for long periods in Congress and were looked upon as the ablest and
most influential of the "reactionary" element in the upper house.

Coincidently with the partial disintegration of the conservative wing
of the Republican party in Congress, there was passed a large volume of
legislation of the type desired by the insurgents. The public land laws
were improved; acts requiring the use of safety appliances on railroads
were strengthened; a Bureau of Mines was established to study the
welfare of the miners; a postal savings bank system was erected; and an
Economy and Efficiency Commission appointed to examine the several
administrative departments so as to discover wasteful methods of doing
business. Of especial importance was the Mann-Elkins Act of June 18,
1910, which further extended the powers of the Interstate Commerce
Commission. Experience had brought out serious defects in the
rate-fixing procedure set up by the Hepburn Act. By that law, to be
sure, a shipper could complain that the roads were charging him an
unreasonable rate and the Commission might, in course of time, uphold
him and order relief; but in the meantime the shipper, especially if he
were a small one, might be crushed out of existence through the large
rates, and the consuming public would have paid increased prices for
commodities with no possibility of a remuneration to them, even if the
Commission decided that the rates levied were unreasonably high. The
Mann-Elkins law, therefore, provided that the Commission might suspend
any proposed change in rates for a period not greater than ten months,
and decide during that time whether it was reasonable and should go
into effect or not. In this way the burden of proving the justice of a
suggested change was placed upon the railroads.[6]

An act of June 25, 1910, which was amended a year later, required the
publication of the names of persons contributing to the federal
campaign funds of the political parties, and the amounts contributed,
as well as a detailed account of the expenditures of the committees and
the purposes for which the expenses were incurred. President Taft also
urged the passage of an income tax amendment to the federal
Constitution and indicated that he was in favor of an amendment
providing for the popular election of senators. Amendments for both
these purposes passed Congress; but they were not ratified and put into
effect until 1913.

In June, 1910, Roosevelt returned from Africa whither he had gone for a
hunting trip, after the inauguration of President Taft. Both elements
in the Republican party were anxious for his sympathy and support.
Roosevelt himself seems to have desired to remain outside the arena, at
least for a time, but for many reasons permanent separation from
politics was impossible. He became a candidate for the position of
temporary chairman of the New York Republican State Convention against
Vice-President James S. Sherman. The contest in the convention brought
out opposition to him on the part of the old-guard, and his triumph
left that wing of the party dissatisfied and disunited. During the
summer and autumn of 1910 he made extensive political tours. At
Ossawatomie, Kansas, he developed the platform of the "New
Nationalism," which included more thorough control of corporations, and
progressive legislation in regard to income taxes, conservation, the
laboring classes, primary elections at which the people could nominate
candidates for office, and the recall of elective officials before the
close of their terms. He urged such vigorous use of the powers of the
federal government that there should be no "neutral ground" between
state and nation, to serve as a refuge for law-breakers. Critics
pointed out that these proposals had been urged by the insurgents and
the followers of Bryan, and there could be no doubt where the
sympathies of Roosevelt lay in the factional dispute within the
Republican party.

While conditions within the organization were such as were indicated by
the hostile criticism of the Payne-Aldrich act, by the Pinchot-Ballinger
controversy, the overturn of Speaker Cannon and the disintegration of
the Aldrich-Hale group, the congressional election of 1910 took place.
Signs of impending change had already become evident. Insurgent
Republicans were carrying the party primaries; and the Democrats, who
were plainly confident, emphasized strongly the tariff act, Cannonism
and the high cost of living as reasons for the removal of the
Republicans. The result was a greater upheaval than even the Democrats
had prophesied. In nine states the Republicans were ousted from
legislatures that would elect United States senators; the new Senate
would contain forty-one Democrats and fifty-one Republicans--too narrow
a Republican majority in view of the strength of the insurgents. In the
choice of members of the lower branch of Congress there was a still
greater revolution; the new House would contain 228 Democrats, 161
Republicans and one Socialist, while Cannon would be retired from the
speakership. In eastern as well as western states, Democratic governors
were elected in surprising numbers. Maine, Massachusetts, Connecticut,
New York, New Jersey, Ohio and Oregon were among them. Of particular
importance, as later events showed, was the success in New Jersey of
Woodrow Wilson, former president of Princeton University.

Not long after the election of 1910 the President sent to Congress a
special message urging the adoption of a reciprocal trade agreement
with Canada. The arrangement provided for freedom of trade in many raw
materials and food products, and for substantial reductions on some
manufactured articles. He believed that the project would benefit both
countries economically and improve the already friendly relations
existing between them, and he set his heart upon its adoption.
Opposition appeared at once: the farmers' organizations protested
vigorously at the reduction of the tariff on agricultural products; the
high protectionists were fearful of an entering wedge which might lead
to further tariff reductions; and the paper and wood pulp interests
also objected. Although the agreement eventually passed both houses of
Congress by large majorities, the opposition was composed chiefly of
Republicans. Objection to the arrangement in Canada turned out to be
stronger than had been anticipated. The fear that commercial
reciprocity might make the Dominion somewhat dependent on the United
States seems to have caused a manifestation of national pride, and Sir
Wilfred Laurier, who had led the forces in favor of the agreement, was
driven out of power and reciprocity defeated. The result for the
administration was failure and further division in the party.

Democratic control of the House during the second half of Taft's term
effectually prevented the passage of any considerable amount of
legislation. A parcel-post law, however, was passed, a Children's
Bureau was established for the study of the welfare of children, and a
Department of Labor provided for, whose secretary was to be a member of
the cabinet. Aided by the insurgents, the Democrats attempted a small
amount of tariff legislation. Although a general revision of the entire
tariff structure would be a long and laborious task, specific schedules
could be revised which would indicate what might be expected in case of
Democratic success in 1912. The sugar, steel, woolen, chemical and
cotton schedules were taken up in accord with this plan and bills were
passed which were uniformly vetoed by the President.

In his attitude toward the regulation of big business, President Taft
was in harmony with his predecessor and was in thorough sympathy,
therefore, with suits brought under the Sherman law against the
Standard Oil Company, and the American Tobacco Company. In May, 1911,
the Supreme Court decided that both of these companies had been guilty
of combining to restrain and to monopolize trade, and ordered a
dissolution of the conspiring elements into separate, competing units.
The Court also undertook to answer some of the knotty questions that
had arisen in relation to section 1 of the act, which declares illegal
"every contract, combination in the form of trust or otherwise, or
conspiracy, in restraint of trade." Did the prohibition against every
contract or combination mean precisely _every_ contract, whether
important or not? Or did it refer merely to large and unreasonable
restraints? The phraseology of the statute seems to prohibit restraints
of all kinds, and the previous decisions of the Court had been in line
with this view. When, then, the decisions in these two cases erected
the "rule of reason" and declared that only those restraints were
forbidden that were unreasonable, the attention of some opponents of
the trusts was focussed on the _obiter dictum_, rather than upon the
decisions themselves. In taking this position, they had the support of
Mr. Justice Harlan who agreed to the decision but condemned the _obiter
dictum_, asserted that the exact words of the law forbade _every_
contract, and deprecated what he believed to be the amendment of
statutes by the courts. The dissolution of the companies into competing
units, however, had no apparent effect that was of benefit to the
public. In fact, immediate increases in the value of Standard Oil
stocks indicated that the decision was of slight consequence.

In the meantime the widening of the breach in the Republican party was
indicated by the formation of the National Progressive Republican
League on January 21, 1911. Its most prominent leaders were Senators
Bourne, Bristow and La Follette; and leading progressives in different
states were invited to join--among them ex-President Roosevelt. It was
the hope that if the latter joined the League, the step might help to
place him in more open opposition to the Taft administration. The
purpose of the organization was the passage of progressive economic and
political legislation, especially acts providing for the election of
senators by vote of the people, direct primaries for the nomination of
elective officers, direct election of delegates to national
conventions, the initiative, referendum and recall in the states, and a
thorough-going corrupt practices act.

Early in 1912 the factions in the Republican party began to consider
the question of a leader for the coming presidential campaign, some of
the progressive element looking to La Follette as the natural
candidate, and others to Roosevelt when it was seen that he would not
support Taft for a renomination. On February 21, Roosevelt addressed a
constitutional convention in Columbus, Ohio, and expressed a political
creed that closely resembled the program of the National Progressive
Republican League. In the meantime the demand for Roosevelt as a
candidate had been incessant on the part of numerous Republicans of
insurgent sympathies, who realized how many more progressive principles
he had accepted than Taft. Finally on February 24 he replied to an
appeal from a group of his supporters, including seven state governors,
that he would accept a nomination. Thereupon most of the progressives
transferred their allegiance from La Follette to the ex-President.
President Taft's fighting spirit had become aroused, in the meanwhile,
and he had declared that only death would keep him out of the fight.

The call had already been issued for the Republican Nominating
Convention to be held in Chicago, in June, and the contest began for
the control of the 1,078 delegates who would compose its membership.
The supporters of Taft, being in possession of the party machinery,
were able to dictate the choice of many of these delegates, especially
from the South, by means that had been usual in politics for many
years. The friends of Roosevelt, in order to overcome this handicap,
began to demand presidential preference primaries, in which the people
might make known their wishes, and in which his personal popularity
would make him a strong contender. During the pre-convention campaign,
twelve states held primaries and the others held the usual party
conventions. At first Taft did not actively enter the contest, but the
efforts of Roosevelt were so successful and his charges against the
President so numerous that he felt compelled to take the stump. The
country was then treated to the spectacle of a President and an
ex-President touring the country and acrimoniously attacking each
other. The progressives, Taft asserted, were "political emotionalists"
and "neurotics"; Roosevelt, he complained, had promised not to accept
another nomination, had broken his agreement, and had not given a fair
account of the policies which the administration had been following.
Roosevelt charged Taft with being a reactionary, a friend of the
"bosses" and with using the patronage in order to secure a
renomination. And he grated on the sensibilities of the nation by
referring to his influence in getting Taft elected in 1908 and
remarking, "it is a bad trait to bite the hand that feeds you." The
result of the presidential preference primaries in the few states that
held them was overwhelmingly in favor of Roosevelt; in the states where
conventions chose the delegates, Taft obtained a majority; in the case
of over 200 delegates, there were disputes as to whether Taft or
Roosevelt men were fairly chosen. These contests, as usual, were
decided by the National Republican Committee, with the right of appeal
to the Convention itself. The Committee decided nearly all the contests
in favor of Taft's friends, and since all the delegates thus chosen
would sit in the Convention and vote on one another's cases, the
decision seemed likely to be final.

The scene of action then shifted to Chicago where the Convention
assembled on June 18. Aroused by the action of the Committee in the
contests, Roosevelt went thither to care for his interests.[7] The
election of a temporary chairman resulted in the choice of Elihu Root,
who was favorable to Taft. The Roosevelt delegates, declaring that the
contests had been unfairly decided, enlivened the roll-call by shouts
of "robbers," "thieves"; and when Root thanked the Convention for the
confidence which it reposed in him, his words were greeted with groans.
Upon the failure of an attempt to revise the decision of the National
Committee in the cases of the contested delegates, Roosevelt announced
that he was "through." One of his supporters read to the Convention a
statement from him charging that the Committee, under the direction of
Taft, had stolen eighty or ninety delegates, making the gathering no
longer in any proper sense a Republican convention. Thereafter most of
the Roosevelt delegates refused to share either in the nomination of
the candidate or in the adoption of a platform. The choice of Taft as
the candidate was then made without difficulty.

The platform contained the usual planks concerning the party's past,
the protective tariff and the civil service; and it reflected something
of the rising interest in economic and political reforms in its
advocacy of laws limiting the hours of labor for women and children,
workmen's compensation acts, reforms in legal procedure, a simpler
process than impeachment for the removal of judges, additions to the
anti-trust law, the revision of the currency system, publicity of
campaign contributions and a parcel-post.

As the Republican convention was drawing its labors to a close, the
dissatisfied adherents of Roosevelt met and invited him to become the
candidate of a new organization. Upon his acceptance, a call was issued
for a convention of the Progressive Party, to be held in Chicago on
August 5. The discord among the Republicans was viewed with undisguised
content by the Democratic leaders, for it seemed likely to open to them
the doorway to power. Yet the same difference between liberals and
conservatives that had been the outstanding feature of the Republican
convention was evident among the Democrats, and nobody could be sure
that a schism would not take place.

There was no lack of aspirants for the presidential nomination. J.B.
("Champ") Clark, Speaker of the House of Representatives, Governor
Judson Harmon, of Ohio, O.W. Underwood, Chairman of the House Committee
on Ways and Means, and Governor Woodrow Wilson, of New Jersey, all had
earnest supporters. In contests in the state conventions and primaries,
Speaker Clark was most successful, although not enough delegates were
pledged to him to secure the nomination.

The convention met in Baltimore on June 25, and for the most part
centered about the activities of Bryan. On the third day he presented a
resolution declaring the convention opposed to the nomination of any
candidate who was under obligations to J.P. Morgan, T.F. Ryan, August
Belmont, or any of the "privilege-hunting and favor-seeking class." An
uproar ensued, but the resolution was overwhelmingly adopted. Balloting
for the candidate then began. Speaker Clark had a majority, but was far
from having the two-thirds majority which Democratic conventions
require; Governor Wilson was more than a hundred votes behind him.
While the fourteenth ballot was being taken, Bryan created a new
sensation by announcing that he should transfer his vote from Clark to
Wilson, on the ground that the New York delegates were in the hands of
Charles F. Murphy, the leader of Tammany Hall, and that Murphy was for
the Speaker. The relative positions of the two leading candidates
remained unchanged, however, for five ballots more. Then the tide began
to turn. At the thirtieth, Governor Wilson led for the first time, and
on the forty-sixth Clark's support broke and Wilson was nominated.

The platform resembled that of 1908. It called for immediate downward
revision of the tariff, the strengthening of the anti-trust laws,
presidential preference primaries, prohibition of corporation
contributions to campaign funds, a single term for the president and
the revision of the banking and currency laws.

The organization of the Progressive party, in the meantime, was rapidly
proceeding, and on August 5 the national convention was held. It was an
unusual political gathering both in its personnel--for women delegates
shared in its deliberations--and in the emotional fervor which
dominated its sessions. At the Democratic convention the delegates had
awakened the echoes with the familiar song "Hail! Hail! The gang's all
here"; the Progressives expressed their convictions in "Onward,
Christian Soldiers." Roosevelt's speech was called his "confession of
faith"; his charge that both of the old parties were boss-ridden and
privilege-controlled epitomized the prevailing sentiment among his
hearers. Without a contest Roosevelt was nominated for the presidency
and Hiram Johnson of California for the vice-presidency.

The platform adopted was distinctly a reform document. It advocated
such political innovations as direct primaries, the direct election of
senators, the initiative, referendum and recall, a more expeditious
method of amending the Constitution, women's suffrage, and the
limitation of campaign expenditures. A detailed program of social and
economic legislation included laws for the prevention of accidents, the
prohibition of child labor, a "living wage," the eight-hour day, a
Department of Labor, the conservation of the nation's resources, and
the development of the agricultural interests. The third portion of the
platform dealt with "the unholy alliance between corrupt business and
corrupt politics." It declared the test of corporate efficiency to be
the ability "to serve the public"; it demanded the "strong national
regulation of interstate corporations," a federal industrial commission
comparable to the Interstate Commerce Commission and the protection of
the people from concerns offering worthless investments under highly
colored and specious appearances.

The results of the election indicated how complete the division
in the Republican party had been. In the electoral college Wilson
received 435 votes to Roosevelt's 88 and Taft's 8. Yet Wilson's
popular vote--6,300,000--fell far short of the combined Roosevelt-Taft
vote--7,500,000--and was less than that of Bryan in 1896, 1900, and
1908.[8] The fact that the combined Roosevelt-Taft vote was less than
that received by Taft in 1908 seems to indicate that many Republicans
refused to vote. The control of Congress, in both houses, went to the
Democrats, even such a popular leader as Speaker Cannon failing of
reelection. In twenty-one of the thirty-five states where governors
were chosen, the Democrats were triumphant. Whether, then, the schism
in the Republican party was responsible for the success of the
opposition, or whether the electorate was determined upon a change
regardless of conditions in the party which had hitherto controlled
popular favor, the fact was that the overturn was complete. And
circumstances that could not have been foreseen and that affected the
entire world were destined to make the political revolution profoundly
significant.


BIBLIOGRAPHICAL NOTE

In the main, periodical literature written with more or less partisan
bias must be relied upon.

For the election of 1908, F.A. Ogg, _National Progress_ (1918), and the
better newspapers and periodicals. W.H. Taft may be studied in his
_Presidential Addresses and State Papers_ (1910), _Present Day
Problems_ (1908), and _Our Chief Magistrate and His Powers_ (1916).

On the Payne-Aldrich tariff: S.W. McCall in _Atlantic Monthly_, vol.
CIV, p. 562; G.M. Fisk in _Political Science Quarterly_, XXV, p. 35;
H.P. Willis in _Journal of Political Economy_, XVII, pp. 1, 589, XVIII,
1; in addition to Tarbell and Taussig.

The documents in the Pinchot-Ballinger controversy are in _Senate
Documents_, 61st Congress, 2nd session, vol. 44 (Serial Number 5643),
and 3rd session, vol. 34 (Serial Numbers 5892-5903).

For other incidents: C.R. Atkinson, _Committee on Rules and the
Overthrow of Speaker Cannon_ (1911); Canadian reciprocity in _Senate
Documents_, 61st Congress, 3rd session, vol. 84 (Serial Number 5942);
Appleton's _American Year Book_ (1911). The decisions in the Standard
Oil and American Tobacco cases are in _United States Reports_, vol.
221, pp. 1, 106; a good discussion will be found in W.H. Taft,
_Anti-Trust Act and the Supreme Court_ (1914). For the rise of the
insurgent movement and the election of 1912, F.E. Haynes, _Third Party
Movements_ (1916); R.M. La Follette, _Autobiography_; B.P. De Witt,
_Progressive Movement_ (1915); W.J. Bryan, _Tale of Two Conventions_
(1912); besides Ogg, Beard and Stanwood.

The _American Year Book_ (1910-), becomes serviceable in connection
with major political events. Its articles are usually non-partisan and
may be relied upon to bring continuing tendencies and practices up to
date.

       *       *       *       *       *

[1] Above, p. 322.

[2] The cabinet was composed of: P.C. Knox, Pa., Secretary of State; P.
MacVeagh, III., Secretary of the Treasury; J.M. Dickinson, Tenn.,
Secretary of War; G.W. Wiekersham, N.Y., Attorney-General; F.H.
Hitchcock, Mass., Postmaster-General; G.L. Meyer, Mass., Secretary of
the Navy; R.A. Ballinger, Wash., Secretary of the Interior; J. Wilson,
Ia., Secretary of Agriculture; C. Nagel, Mo., Secretary of Commerce and
Labor. Meyer and Wilson had been in Roosevelt's cabinet.

[3] Other features of the act were the establishment of a Court for the
settlement of tariff disputes, provisions for a tariff commission and a
tax on corporation incomes.

[4] Mr. Dooley, who was well known as a humorous character created by
F.P. Dunne, made merry with the claim that the tariff had been reduced,
by reading to his friend Mr. Hennessy the "necessities of life" which
had been placed on the free-list and which included curling stones,
teeth, sea-moss, newspapers, nuts, nux vomica, Pulu, canary bird seed,
divy divy and other commodities.

[5] A sample of the jocosity that partially relieved the tension is the
following portion of the _Congressional Record_ for March 18:

    The Speaker _pro tempore_: The House will be in order. Gentlemen
    will understand the impropriety of singing on the floor, even though
    the House is not at this moment transacting any business. The House
    is not in recess.

    Chorus. "There'll be a hot time in the old town to-night."

    The Speaker _pro tempore_. That was last night, not to-night.
    (Laughter.) The House will be in order.

    Mr. Shackleford. Mr. Speaker, I make the point of order that the
    tap-tapping of the Chair's gavel interferes with the music.
    (Laughter.)

Cf. Atkinson, _Committee on Rules_, 115.

[6] A Commerce Court was also provided, so as to expedite the decision
of appeals from orders of the Commission. Its career was brief, for
Congress was not well-disposed toward the project, and the Court was
abolished in 1913.

[7] When Roosevelt arrived in Chicago, he remarked that he felt like a
"bull moose," an expression which later gave his party its popular
name.

[8] Roosevelt, 4,000,000; Taft, 3,500,000.




CHAPTER XXII


ECONOMIC AND POLITICAL TENDENCIES SINCE 1896

During the four decades between the opening of the Civil War and the
close of the nineteenth century, the United States became in many
respects an economic unit. The passage of the Interstate Commerce Act
in 1887, for instance, was an early recognition of the fact that the
transportation problem of the nation transcended state bounds; the
Sherman Anti-trust law of 1890 arose from the realization that
commercial and industrial unity were rapidly coming to pass; the
American Federation of Labor brought workmen from all states and many
trades into a single organization. The election of 1896 and the amazing
consolidation of business enterprises at the close of the century were
further proofs that the day had passed when any section of the United
States could live an isolated economic life without relation to other
parts of the country. Instead of remaining a federation of diverse
economic sections, we became increasingly homogeneous. Much of the
economic and political legislation enacted after 1896, and many of the
practices and standards which were adopted by leaders in economic and
political life were an outgrowth of the new conditions.

It will be remembered that the eighties and early nineties had been
years of labor unrest. Costly and bitter strikes on the part of the
workmen, and resolute and powerful resistance on the part of the
employers were the commonplaces of the history of labor. The
culmination was the Pullman strike of 1894.[1] Its cost in money and
suffering was appalling; it placed the federal military power in the
hands of the employers; and although it was a failure as far as the
strikers were concerned, yet an impartial investigation after the
struggle was over established the justice of much of which the men had
complained. If discriminating justice were to be measured out to both
sides, instead of victory to the side of the strongest battalions, and
if intolerable waste and discomfort were to be avoided, some remedies
for industrial unrest must be discovered which would replace strikes
and violence. Happily, signs were not wanting that such a change was
slowly taking place.

A combination of influences tended to place the labor problem on a new
footing after 1896. One of the most important of these forces was the
American Federation of Labor which greatly increased its size and
activities, especially about the opening of the new century, growing
from 950,000 members in 1901 to 4,302,148 in April, 1920. Its
president, Samuel Gompers, is an able, resourceful leader, who has
remained in control from 1882 to the present (1920), with the single
exception of the year 1895, so that the organization has had the
benefit of experienced leadership and continuity of purpose. Although a
radical, socialistic element broke away in 1905 and formed the
Industrial Workers of the World, yet the defection was not immediately
serious and in general schisms have been avoided. Several other labor
organizations, although unconnected with the Federation exerted a
strong influence; in particular the brotherhoods of railway employees,
by frequent threats to strike and thereby tie up the transportation
system, aided in bringing the demands of labor to public notice.

Moreover, after 1896 and especially after the coal strike of 1902 there
was an increasing recognition on the part of the public that a labor
problem existed and that it must be solved in some way other than by
force of arms. Physicians and scientific experts called attention to
the lack of proper care for the health of workmen in dangerous
industries; the movement for the preservation of the forests and
mineral supplies emphasized the need of efforts for the conservation of
human lives; social reformers, economists, writers and educators upheld
the needs and rights of the neglected classes; and the press and the
muck-rake periodicals found it profitable to expose extreme abuses.
Distress that had hitherto been unnoticed or disregarded became
important, and remedies were demanded. Change was in the air, and not
alone in America, for England and France were experiencing the same
problems, and attempting to devise new expedients to solve them. After
the beginning of the new century, also, the employing class came to a
better realization of the existence of the labor problem and sought
solutions in ways that must be mentioned later.[2] There was a more
widespread acceptance of the principle of trade agreements, whereby the
employer and the men determined the conditions of labor by means of
direct negotiations.

Although it had been the policy of the American Federation of Labor to
keep out of politics, it was almost inevitable that the policy should
receive some modifications. Organizations of employers were influential
at Washington, and had long been so. Accordingly in 1908 the Democratic
platform was endorsed on account of its labor planks, and again in 1910
and 1912. By the latter year all parties were earnestly striving to
capture the labor vote, and in particular the Democratic and
Progressive platforms embodied most of what the wage earner had been
demanding for the previous generation.

The major demands in the labor program of earlier years--higher wages,
shorter hours, settled conditions of employment, and the like--were not
altered after 1896, but a few striking advances were made. The attempt
to legislate concerning hours of employment, for example, had been
continually obstructed by the clauses in the Fifth and Fourteenth
Amendments forbidding any legislation depriving the individual of
"life, liberty, or property, without due process of law." The courts
had usually interpreted these phrases as prohibiting laws restricting
hours of labor, on the ground that the liberty of the workman to
contract freely regarding his own working hours was thereby infringed.
A Massachusetts law of 1874, nevertheless, which limited a day's work
for women and children to ten hours, had followed the long-continued
assertion that regulatory legislation could be based on the "police
power"--a somewhat indefinite authority which was gradually conceded by
the courts to the states and the federal government, and under which it
was possible to pass legislation concerning the conservation of the
health and morals of the people without violating the Constitution. Not
until 1908, however, was the constitutionality of such legislation
finally settled by the Supreme Court, in upholding an Oregon ten-hour
law. "As healthy mothers are essential to vigorous offspring," the
decision asserted, "the physical well-being of women becomes an object
of public interest and care in order to preserve the strength and vigor
of the race." In other words, the Court was prepared to approve
limitations on the freedom of contract in order to further the public
interest. The Massachusetts law was imitated far and wide, so that at
the present time an almost negligible number of states have failed to
restrict the length of the working day for women.

Recently, also, substantial progress has been made in restricting
working hours for children. As long ago as 1866 Massachusetts had
restricted the employment of children, but neither this law nor similar
laws passed by other states had been fully enforced. Greater progress
has been made since 1903, when Illinois, followed by the majority of
the important industrial states, established the eight-hour standard
for children under sixteen. Impressed with the need of federal
legislation to coerce backward states, the reformers took their case to
Congress where a federal act was passed in 1916. On account of
constitutional limitations, the measure was framed so as to forbid
shipment, on interstate railways, of the products of factories
employing children under fourteen years of age. It was estimated that
150,000 out of nearly 2,000,000 working children might be affected by
the act. Its fate, however, was that of many another piece of economic
legislation; by a vote of five to four, the Supreme Court declared the
law unconstitutional on the ground that it was not an attempt to
regulate commerce, but an attempt to regulate the conditions of
manufacture. Early in 1919 the effort to regulate child labor was
renewed through the imposition of a tax of ten per cent. on the net
profits of factories employing children under fourteen years of age.
The constitutionality of the law has not yet been tested (1920).

It will be noted that all the foregoing legislative attempts to reduce
the working day affected women and children only; in general, little
attempt has been made to limit the working day for men. Nevertheless,
large numbers of cities, more than half the states, and the federal
government provide for an eight-hour day on public work; and western
states have followed the lead of Utah in passing eight-hour laws for
miners. Hours of labor for railway employees have also been the subject
of study and legislation. Cases had not been unknown where employees
were kept at their posts for thirty, fifty and even one hundred hours;
frequently such workmen fell asleep and disastrous accidents occurred.
In 1907 this situation was met by a congressional act limiting the
hours of railway engineers to sixteen and providing that periods of
work must be followed by specified rest periods. Train-despatchers,
telegraphers, and others were similarly protected. A majority of the
states imitated these federal statutes. In a few cases, state laws have
been passed which were intended to limit working hours in other
especial industries. The most famous of these was one in New York,
which restricted the working day in bakeries to ten hours. In the
decision Lochner _v._ New York, the Supreme Court declared the law
unconstitutional.[3]

The early twentieth century also saw progress on the subject of
compensation for industrial accidents. As far back as 1884 Germany had
enacted a law which put the blame for all accidents on the employers,
except when the victim was wilfully negligent; in 1897 England had
passed the British Workmen's Compensation Act which virtually made the
employer the insurer of his workmen against all accidents. The theory
underlying these laws was that accidents were like wear and tear and
should be made a charge on the industry, like the depreciation of
buildings and machinery. The United States, however, lagged behind all
other industrial nations, despite the astonishing number of accidents
which yearly occurred. In 1908, for example, it was estimated that two
million men were injured, of whom 200,000 were permanently disabled,
and 30,000 died--a larger number than the federal killed, wounded and
missing in the Gettysburg campaign. Under previous practice in this
country compensation for industrial accidents had been awarded in
accord with common law principles, under which the employer was not
responsible for an employee who was injured through the negligence of a
fellow servant. Any workman who entered hazardous employment was
assumed under the common law to know the dangers and be ready to run
the risks, and no compensation could be recovered unless it could be
shown that the master had been negligent and the employee had not also
been negligent. It came widely to be thought that the common law did
not justly apply to the complex industrial system of modern times. It
did not seem equitable, for example, that the fellow servant doctrine
should hold in case of a railway employee killed through the negligence
of a train despatcher many miles away, whom he did not know and had
never even seen.

The first workmen's compensation act in the United States was passed in
Maryland in 1902. Its scope was narrow and it came to nothing as it was
declared unconstitutional. In course of time, however, legislation was
framed in such language as to pass muster before the courts, and
moreover judicial decisions changed, as time went on, in the direction
desired by popular opinion. Beginning in 1911 there was an avalanche of
liability and compensation laws and by 1920 forty-two states, together
with Porto Rico, Alaska and Hawaii had passed acts that placed the
burden more or less completely on the employer, and provided schemes of
compensation. The federal government also took action. At the
suggestion of President Roosevelt an act was passed in 1908 making
interstate railroads responsible for injuries to employees and
expressly doing away with former common law practices.[4] At the same
time a similar liability was placed upon the United States for
accidents occurring to certain classes of government employees and a
plan of compensation was established. In 1916 another act brought all
civil servants under the system.

Several other types of social legislation have made considerable
progress in Europe, but have found little or no foot-hold in this
country, such as minimum wage laws, health insurance, old age and
widows' pensions, and unemployment insurance. The minimum wage law,
establishing a level below which wages must not go, has been adopted by
Massachusetts and a few other states in a restricted form. The
unemployment problem has hardly been touched, although the federal
Department of Labor since its establishment in 1913 has gathered and
made public information in regard to opportunities for work.

Recent years have likewise seen a vast number of laws which together
have made a new era in American industrial life, although separately no
one of them was revolutionary. For example, matches containing white
phosphorous were subjected to a prohibitive tax because of the harmful
effect of the phosphorous on workmen in match factories; greater care
was exercised in guarding dangerous machines, elevator wells and the
like; fire protection, harmful or poisonous fumes and dust, ventilation
and safety devices in mines, safety appliances on railway trains,
together with numberless other accompaniments of modern industry were
the subject of state legislation. Almost as important as legislative
enactments were the changes in working conditions voluntarily made by
the most progressive corporations. One who compares a factory built
within twenty-five years of the close of the Civil War with a building
erected since 1900 discovers revolutionary changes. Later buildings are
constructed with much more care for ventilation, light and convenience;
in some cases even the temperature of the work-rooms is a matter for
painstaking attention; "welfare" work is now a commonplace, with rest
rooms, lunch rooms, recreation fields and factory social activities.
Factory or store committees that confer with higher officers in
relation to hours and the needs and desires of the employees are by no
means uncommon, and some of the large corporations even provide pension
systems for their employees.

On the other hand, laws and statute books did not always guarantee
performance. Laws were continually avoided both by the employers and
the employees; workmen transgressed rules laid down for their welfare;
the passage and execution of many laws were hampered to the last degree
by short-sighted employers; the courts invalidated much legislation on
the ground of unconstitutionality; and progress was frequently confined
to leading states or corporations and was by no means universal. It
nevertheless is true that the tendencies in social and economic
legislation since 1896 have been widely different from those prevalent
before that year.

In several cases the influence of the labor element in federal
legislation has been decisive. The use of the injunction, it will be
remembered, was one of the grievances most frequently mentioned at the
time of the Pullman strike. In the campaign of 1908 both parties strove
to attract the labor vote by proposals of reform, but not until 1914
was the issuance of injunctions forbidden "unless necessary to prevent
irreparable injury to prosperity ... for which injury there is no
adequate remedy at law." At the same time the labor unions were
exempted from the operation of the anti-trust laws.[5] The influence of
the labor organizations was also a factor in the agitation for the
restriction of immigration which continued from 1897 to 1917. In the
former year a bill was passed which contained a literacy test--that is,
a provision excluding persons who were unable to read or write English
or some other language. President Cleveland exercised his veto, as did
later presidents when similar measures were carried in 1913, 1915 and
1917, but in the latter year Congress was able to muster sufficient
strength to pass the act over the President's veto. One of the main
purposes of the measure seems to have been the restriction of the labor
supply, and hence it enlisted the support of the American Federation of
Labor and other similar organizations.[6]

The ameliorative measures already mentioned have by no means prevented
the boycott and the strike. Indeed they have not, except in rare cases,
directly affected the two great causes of industrial disputes--hours
and wages for adult male laborers. Many formidable and violent strikes
have occurred since 1896, such as those of the shirt-waist makers in
New York in 1909, the textile operatives in Lawrence, Massachusetts, in
1912, and the Colorado coal miners in 1913. On the whole, however, it
seems that the labor unions have developed somewhat greater
conservatism and that their influence has been against violence in
strikes.

Few aspects of the labor problem have been the cause of more earnest
thought than the search for peaceful methods of settling industrial
controversies. In 1898, by the Erdman Act, the federal government
provided a means for arbitrating disputes on interstate railways. The
Newlands Act of 1913 superseded this by the creation of a formal Board
of Mediation and Conciliation, and many disputes were decided under the
terms of these laws. The Department of Labor mediated in many
industrial disputes, and in 1916 when the four railway brotherhoods
threatened to strike for an eight-hour day, Congress itself intervened
with a piece of special legislation, the Adamson law, which was framed
to settle the questions under dispute.[7] In some cases, profit-sharing
plans have been put into force; in others, disputes have been referred
to impartial boards of outsiders; and in yet others, machinery has been
established for continuous conference between representatives of the
employees and employers. Neither federal and state boards and
commissions, however, nor the efforts of individual employers have been
sufficient fully to insure industrial peace.

The increased activity of the state and federal governments in the
fields of economic legislation, as indicated in the passage of labor
laws, was also illustrated in two important measures passed in 1906.
The adulteration of foods had been brought to a state of dangerous
perfection, and drugs had been commonly advertised and sold all over
the country which had none of the powers ascribed to them by their
makers. Since the eighties, many states had forbidden the sale of
impure or tainted food, but the laws were varied and difficult to
enforce, and it appeared that reliance must be placed on the federal
government. As early as 1890 a federal law had provided for the
inspection of meats which were to be exported, but otherwise little
progress had been made. In 1906 Upton Sinclair published _The Jungle_,
a novel which purported to describe the ghastly conditions under which
the meat packers of Chicago conducted their business. Sinclair's book,
together with a campaign of education conducted by the muckrake
periodicals against harmful patent medicines aroused public interest to
such a degree, that two important laws were passed. One provided for
federal inspection of meats intended for interstate commerce, so as to
make sure that they were obtained from healthy animals and slaughtered
under sanitary conditions. The other act concerned foods and drugs, and
prohibited the sale of these commodities if they contained any
injurious drugs, chemicals or preservatives, while a later amendment
forbade false statements on labels attached to medical compounds. As a
result of the provisions of the law in regard to patent medicines, many
concerns which had been selling drugs that were falsely advertised as
having curative effects were compelled to retire from business.

Innovations in the field of politics and government since 1896 have
been as marked as in the field of social and economic legislation.
Possibly the most outstanding development has been the rapid expansion
of the range and variety of the activities of the federal government.
The unification of the economic life of the nation, as has been shown,
compelled a program of federal economic legislation, and helped
inculcate a feeling of greater political solidarity. When fires and
floods and other disasters occurred which were too great for a single
city or state to take care of, when state laws became confusing because
of their variety, when railroads crossed a dozen states and
corporations that were chartered in New Jersey did business in Maine,
Florida and California, only at the federal capital could the requisite
authority be found, which would give the needed relief. As the theory
of _laissez faire_ gradually broke down, moreover, giving way to the
belief that the government ought to be the servant of the mass of the
people, it was inevitable that the people should themselves turn more
to legislation as a remedy for their grievances. To Washington,
therefore, hurried the proponents of every reform.

This tendency was not only counter to the probable intention of the
framers of the Constitution, but it trenched upon the powers
specifically granted to the states. The tenth amendment stated in so
many words that "The powers not delegated to the United States ... are
reserved to the States." It was necessary for the federal government to
act, however, or else to leave problems that had become national in
character to the chaos that results from legislation in nearly fifty
states. State laws concerning railroads, for example, as well as
marriage and divorce, child labor and trusts are even now in a maze. No
solution of the problem seemed possible other than constant stretching
of the terms of the Constitution. In 1906, one of the most conservative
statesmen in the country, Elihu Boot, even went so far as to utter a
warning that if the states did not use their powers to better advantage
a "construction of the Constitution will be found to vest the power
where it will be exercised-in the National Government." The burden thus
shifted from state to nation was somewhat lightened by the appointment
of numerous commissions to which was entrusted the administration of
specific laws or the accumulation of specific data. The earliest of
these was the Interstate Commerce Commission; later, others were
appointed to administer laws concerning banking, the tariff and the
trusts.

With the expansion of the power of the federal government went the
elevation of the office of chief executive. Cleveland's use of the veto
power had given an indication of the possibilities of the presidential
office in obstructing undesirable legislation; his action in bringing
about the repeal of the purchase clause of the Sherman silver law in
1890 had shown the more positive force which a determined officer could
exert. Roosevelt's activity in carrying his anti-trust program to the
people, and his mediation in the coal strike carried the prestige of
the presidency to greater heights. President Taft was by no means
radical in his interpretation of the powers and possibilities of his
office; nevertheless his conception of it was far removed from the
conservative philosophy of President McKinley, and he even suggested in
a message to Congress that the cabinet officers be given seats,
although without votes, in the Senate and House. His successor
augmented rather than diminished the powers of the presidential office.

The Senate, on the contrary, lost both in power and in prestige. Many
reasons for the increasing popular distrust of the Senate after the
middle nineties can be given. There was a widespread belief that a
controlling fraction of the body had achieved membership through
wealth, through the assistance of corporate interests and because of
skill in the manipulation of political wires. The charge was common
that a small coterie of powerful strategists held the Senate in their
hands and with it the control of important legislation. Most of all,
and especially in the West, many thoughtful people believed that the
state legislatures were easily influenced to choose inferior or
untrustworthy men as senators. Whatever the reasons, however, there
grew increasingly after 1870 and particularly after 1893 a demand for
the popular election of senators. Between the latter year and 1911, at
six different times resolutions were presented to Congress proposing an
amendment to the Constitution which should secure popular election. At
length Congress gave way, adopted an amendment, and sent it to the
states. Within ten months thirty-six states had agreed, and after May
31, 1913, senators were elected by the people.

The demand for greater popular control over the choice of senators was
a part, merely, of a somewhat general political trend. Distrust of the
state legislatures had long been observable, and new state
constitutions had been notable for detailed prohibitions placed upon
law-making bodies. The West, which had gone to greatest extremes in
framing new state constitutions, was also the testing-ground for the
initiative, referendum and recall. The first of these devices--the
initiative--is a plan by which a specified percentage of the voters may
initiate legislation--that is, propose a law and require the officials
of the state to submit it to the electorate. If the people accept the
proposal, it becomes law as if enacted by the legislature. Under the
referendum system, any measure already accepted by the legislature is
held in abeyance on petition of a specified number of voters, until
presented to the people for approval or rejection. Both the initiative
and the referendum had been commonly used in Switzerland before being
adopted in South Dakota in 1898. In less than two decades they had been
accepted in twenty-one states, all but four of which were west of the
Mississippi, and in one of the four eastern states, Maryland, only the
referendum was tried. In Oregon, which made the most complete trial of
these methods of legislation, both the initiative and the referendum
were extended to the municipalities. The reasons for the innovation
were to be found in the determination to discover a means of compelling
negligent or boss-controlled state legislatures to respond to public
opinion.[8]

The recall is a process by which any public official may be withdrawn
from his office by popular vote before the expiration of his term. Los
Angeles adopted the plan in 1903 and was imitated by a small number of
other western cities; Oregon in 1908 applied the device to all state
officers, and in one form or another it has been adopted in ten states
(1920). During the campaign of 1912 Roosevelt proposed that the voters
be allowed to ratify or reject the decision of the courts on the
constitutionality of legislation. The results of the suggestion were
negligible.

More significant than the recall as an indication of the prevailing
desire to increase popular control over the processes of government was
the adoption of direct primaries. Under this expedient the nominees of
a party for office are chosen directly by the party voters, rather than
by a party convention. Wisconsin first used the system in 1903 and from
that state it spread rapidly. At the present time most states have some
form of direct nomination. The peculiar circumstances surrounding the
campaign for the Republican nominations in 1912 gave force to the
demand for presidential preference primaries which were held in about a
fourth of the states. Only the future can tell with assurance whether
the demand is more than temporary.

The agitation for women's suffrage was another example of the
increasing desire for popular control of government. Suffrage for women
was first granted by Wyoming in 1869 when its territorial government
was organized, but the movement lagged thereafter until the early years
of the twentieth century. At that time increasing numbers of states
began to grant political privileges to women, and finally in 1919
Congress passed a proposed constitutional amendment expressly stating
that sex should not be a bar to the suffrage.[9]

Accompanying the increased popular control of government after 1896 was
a gradual demand for a higher level of political ethics. The
revelations of the insurance investigations of 1905 were significant of
this change. Early in that year certain newspapers made charges against
the Equitable Life Assurance Company which were taken up by the New
York legislature and referred to a committee for investigation. The
committee's task was the examination of the affairs of life insurance
companies doing business in the state of New York; its attorney was
Charles E. Hughes. The results of the investigation amazed the country.
The exorbitant salaries paid to officers, the unreasonable expenses
incurred and the disregard of the rights of the policy holders were of
concern chiefly to persons doing business with the companies. But it
also appeared that several of the larger concerns had divided the
country into districts, and had systematically influenced legislation
affecting either insurance or financial interests to which they or
their officers were related; enormous sums were expended and records
not kept, or so kept as to conceal the real purposes of the
expenditure. The report of the committee showed that Chauncey M. Depew,
a member of the United States Senate, was paid $20,000 a year for legal
services, without his rendering any return that seemed to warrant the
payments made. The contributions of the companies to the Republican
campaign funds were very heavy--$50,000 by one company in 1904. It
appeared from testimony that Democrats also sought contributions from
the companies but were refused. The final report of the committee
unsparingly condemned these abuses and embodied a program of
legislation for their reform, which was put into effect. The public
received an education in the connection of corporations with politics,
and Hughes himself at once became a figure of national importance, the
favorite of the reform element, and was launched upon a career that
made him governor of New York, a member of the United States Supreme
Court and candidate for the presidency.[10]

Laws regulating campaign expenditures had long been on the statute
books although they had been little heeded, but as the result of the
insurance investigation, New York in 1906 forbade contributions by
corporations for political purposes. In 1907 Congress passed a similar
law concerning federal campaigns, and most of the states have since
passed laws placing restrictions on the use of campaign funds. In the
campaign of 1908 Bryan requested that the Democratic National Committee
receive no contributions from corporations, that no sums in excess of
$10,000 be received from any source and that a list of contributors be
published in advance of the election. By a law enacted in 1911 Congress
compelled a statement of the amounts of money spent by committees, and
limited the amounts which might be spent by candidates for Congress. In
1919 the Chairman of the Republican National Committee announced that
the party would raise funds for the next campaign in amounts from $1 to
$1,000. Both parties were discovering that public sentiment opposed
large contributions from individuals and corporations, because they
expect a _quid pro quo_ after the election.[11]


BIBLIOGRAPHICAL NOTE

The best brief general accounts of recent conditions are in F.A. Ogg,
_National Progress_, with an excellent bibliography, which may be
supplemented by the _American Year Book_. On hours and conditions of
labor, J.R. Commons and J.B. Andrews, _Principles of Labor Legislation
_(1916). The decision in Lochner _v._ New York is in _United States
Reports_, vol. 198, p. 45. For the courts and economic legislation,
C.G. Haines, _American Doctrine of Judicial Supremacy _(1914), already
referred to. An excellent historical account of the workmen's
compensation idea is by A.F. Weber in _Political Science Quarterly_
(June, 1902). Ida M. Tarbell, _New Ideals in Business_ (1917),
describes the accomplishments of the industrial leaders rather than of
the rank and file.

Some of the political innovations are discussed in A.L. Lowell, _Public
Opinion and Popular Government_ (1913); _Proceedings of the American
Political Science Association_, V, 37, "The Limitations of Federal
Government"; Elihu Boot, _Addresses on Government and Citizenship
_(1916), "How to Preserve the Local Self-Government of the State." The
most complete account of the historical development of the power of the
president is in Edward Stanwood, _History of the Presidency, II
_(1916), Chap. V. The fullest account of the movement for popular
election of senators is G.H. Haynes, _The Election of Senators _(1906).
The initiative, referendum and recall have given rise to a literature
of their own. Convenient volumes are: C.A. Beard and B.E. Shultz,
_Documents on the State-wide Initiative_, _Referendum and Recall_
(1912); W.B. Munro, _The Initiative, Referendum and Recall_ (1912);
J.D. Barnett, _Operation of the Initiative, Referendum, and Recall in
Oregon_ (1915).

_American Political Science Review _(Aug., 1915), "Presidential
Preference Primaries." The articles in A.C. McLaughlin and A.B. Hart,
_Cyclopaedia of American Government_ (3 vols., 1914), are a convenient
source on most topics considered in this chapter.

On the use of money in politics: _Report of the Legislative Insurance
Investigating Committee _(10 vols., 1905-1906), Armstrong-Hughes
committee; _Testimony before a Sub-committee of the Committee on
Privileges and Elections, United States Senate, 62d Congress, 2d
session, pursuant to Senate Resolution 79_ (Clapp Report).

       *       *       *       *       *

[1] Above, pp. 320-323.

[2] Below, p. 508.

[3] Above, p, 442.

[4] An act of 1906 had been declared unconstitutional.

[5] It should be said, however, that the meaning of this law is far
from clear and is yet (1920) to be interpreted by the courts.

[6] Presidents McKinley and Roosevelt also favored it. See Ogg,
_National Progress_, 123-130.

[7] Below, p. 571.

[8] By 1920 twenty-three states had adopted the referendum or the
initiative and referendum.

[9] The amendment reads: Section 1. The right of citizens of the United
States to vote shall not be denied or abridged by the United States, or
by any State, on account of sex. Section 2. Congress shall have power,
by appropriate legislation, to enforce the provisions of this article.
The amendment was ratified by the required number of states and
proclaimed in force August 26, 1920.

[10] The election of Senator Isaac Stephenson of Wisconsin occasioned
another outbreak of reform sentiment. Investigation betrayed the fact
that he had expended $107,793.05 in his primary campaign. The salary of
a senator at that time was $7,500 per annum.

[11] An investigation of federal campaign expenditures conducted in
1912-1913 by a committee headed by Senator Moses Clapp uncovered much
that had hitherto been only the subject of rumor. The Standard Oil
Company, for instance, contributed $125,000 in 1904. Archbold, the
vice-president of the company, testified that he told Bliss, the
Republican treasurer, "We do not want to make this contribution unless
it is thoroughly acceptable and will be thoroughly appreciated by Mr.
Roosevelt"; and that Bliss "smilingly said we need have no possible
apprehension on that score." Archbold complained later when the
administration attacked the company, but Roosevelt declared that he was
unaware of the contribution at the time. The Republican fund in 1908
was $1,655,000. The testimony of Norman E. Mack, Chairman of the
Democratic National Committee, indicated his perfect willingness to
accept money wherever he could get it, and that he refused to receive
contributions from corporations only because of Bryan's scruples.
Roosevelt declared, on the authority of an insurance officer, that the
Democrats in the campaign of 1904 were after all the corporation funds
they could get.




CHAPTER XXIII


LATER INTERNATIONAL RELATIONS[1]

At the close of the war with Spain it was commonly remarked that the
United States had become a world power; books and periodicals written
on the history of the period were based upon the assumption that
America had swung out into the current of international affairs and
that the traditional isolation of this country had become a thing of
the past. Time must be appealed to, however, for answers to fundamental
questions concerning the character of this change. Did the United
States become a world power in the sense that the majority of its
people threw off that policy of steering clear of permanent alliances
which had been expressed by Washington in his farewell address, in
favor of the policy of participation in world affairs on a footing with
the larger European states? Did the people of the United States after
1898 take a constant and informed interest in world politics and
international relations? Or did the people, after a slight excursion
into the West Indies and the Philippines, return to the traditional
attitude of "splendid isolation"? Was the extent to which the United
States became a world power sufficient to make probable its entry into
a European war?

A cardinal principle of the foreign policy of the United States has
always been its attachment to international peace, particularly through
the practice of arbitration. The great hopes raised by the two Hague
Conferences were striking proofs of this fact. In 1899, at the
suggestion of Czar Nicholas II of Russia, twenty-six leading powers
conferred at The Hague, in order to discover means of limiting
armaments and ensuring lasting peace. A second conference was held in
1907 at the suggestion, in part, of President Roosevelt. At this
gathering forty-four states were represented, including most of the
Latin-American republics. During the two conferences many questions
relating to international law were discussed, and the conclusions
reached were expressed in the form of "Conventions," which the several
powers signed. In the main these agreements related to the rights and
duties of nations and individuals in time of war. Most important among
the agreements was one for the pacific settlement of international
disputes, according to which, in certain less important controversies,
the states concerned would appoint a "commission of inquiry" which
would study the case and give its opinion of the facts involved. It was
also agreed to organize a Permanent Court of Arbitration to be
available at all times for the peaceful settlement of differences.
Strictly speaking this body was not a Court, but a list of judges to
which each nation was to contribute four, and when any countries became
involved in a controversy they could draw arbitrators from the list.
Moreover the powers agreed "if a serious dispute threatens to break out
between two or more of them, to remind these latter that the Permanent
Court is open to them."

The United States was a party to four of the fifteen cases presented to
the Court between 1902 and 1913. The first controversy was between the
United States and Mexico and involved "The Pious Fund," a large sum of
money which was in dispute between Mexico and the Roman Catholic Church
of California, and the second concerned claims of the United States,
Mexico and eight European countries against Venezuela. As the Court was
successfully appealed to in case after case, high hopes began to be
entertained that the "Parliament of Man" had at last been established.
Elihu Root, the Secretary of State, asserted in a communication to the
Senate in 1907 that the Second Conference had presented the greatest
advance ever made at a single time toward the reasonable and peaceful
regulation of international conduct, unless the advance made at The
Hague Conference of 1899 was excepted.

In the meantime, in 1904, under President Roosevelt's leadership,
treaties were arranged with France, Germany, Great Britain and other
nations, under which the contracting parties agreed in advance to
submit their disputes to The Hague Court, although excepting questions
involving vital interests, independence or national honor. While the
Senate was discussing the treaties, it fell into a dispute with the
President in regard to its constitutional rights as part of the
treaty-making power, and although there was general agreement on the
value of the principle of arbitration, yet the Senate insisted upon
amending the treaties, whereupon the President refused to refer them
back to the other nations. Secretary Root revived the project, however,
in 1908 and 1909 and secured amended treaties with a long list of
nations, including Austria-Hungary, France and Great Britain. President
Taft signed treaties with France and England in 1911 which expanded the
earlier agreements so as to include "justiciable" controversies even if
they involved questions of vital interest and honor, but again the
Senate added such amendments that the project was abandoned. Bryan,
Secretary of State from 1913 to 1915, undertook still further to expand
the principles of arbitration, and during his term of office many
treaties were submitted to the Senate, under which the United States
and the other contracting parties agreed to postpone warfare arising
from any cause, for a year, in order that the facts of the controversy
might be looked into. Many of these treaties were ratified by the
Senate.

The attitude of the American people toward the pacific settlement of
international disputes found expression in many ways in addition to the
arrangement of treaties. At Lake Mohonk, yearly conferences were held
at which leading citizens discussed phases of international peace.
Andrew Carnegie and Edwin Ginn, the publisher, devoted large sums of
money to countrywide education and propaganda on the subject. The
leaders of the movement and the membership of the organizations
included so many of the most prominent persons of their time--public
officials, university presidents and men of influence as to prove that
the traditional American reliance upon international arbitration was
more firmly rooted in 1914 than ever before in our history.

The attitude of the United States toward purely European controversies
was illustrated in our action on the Moroccan question. In 1905-1906 a
controversy broke out between Germany and France in relation to
Morocco, and in January of the latter year a conference was held at
Algeciras in southern Spain in which ten European nations and the
United States took part. The result of the meeting was an "Act" which
defined the policy of the signatory powers toward Morocco. The Senate,
in ratifying the Act, asserted that its action was not to be considered
a departure from our traditional policy of aloofness from European
questions.

[Illustration:
Caribbean interests of the United States]

The outstanding incident in our relations with that part of America
south of the republic of Mexico was the controversy with Colombia over
the Panama Canal strip. The project for a canal across the Isthmus of
Panama was as old as colonization in America. For present purposes,
however, it is not necessary to go farther into the past than the
Clayton-Bulwer treaty of 1850, by the terms of which the United States
and Great Britain agreed that neither would obtain any control over an
isthmian canal without the other. As time went on, however, American
sentiment in favor of a canal built, owned and operated by the United
States alone grew so powerful that the Hay-Pauncefote treaty of 1901
was arranged with Great Britain. This agreement permitted a canal
constructed under the auspices of the United States. Sentiment in
Congress was divided between a route through Nicaragua and one through
that part of the Republic of Colombia known as Panama, but in 1902 an
act was passed authorizing the President to acquire the rights of the
New Panama Canal Company, of France, on the isthmus for not more than
$40,000,000, and also to acquire a strip of land from Colombia not less
than six miles wide.[2] In case the President was unable to obtain
these rights "within a reasonable time and upon reasonable terms," he
was to turn to the Nicaragua route. President Roosevelt was himself in
favor of the Panama project.

The Hay-Herran convention with Colombia was accordingly drawn up and
signed in January, 1903, giving the United States the desired rights on
the isthmus, but the Senate of Colombia rejected the treaty. Thereupon
the New Panama Canal Company became alarmed because it would lose
$40,000,000 in case the United States turned from Panama to Nicaragua,
and its agents busied themselves on the isthmus in the attempt to
foment a break between Colombia and its province of Panama; the people
of Panama became aroused because their chief source of future profit
lay in their strategic position between the two oceans; and the
President was concerned because Congress would soon meet and might
insist on the Nicaragua route or at least greatly delay progress. He
hoped for a successful revolt in Panama which would enable him to treat
with the province rather than with Colombia, and he even determined to
advise Congress to take possession forcibly if the revolt did not take
place.

The administration meanwhile kept closely in touch with affairs in
Panama, and having reason to suspect the possibility of a revolution
sent war vessels to the isthmus on November 2, 1903, to prevent troops,
either Colombian or revolutionary, from landing at any point within
fifty miles of Panama. Since the only way by which revolution in Panama
could be repressed was through the presence of Colombian troops, the
action of the American government made success highly probable in case
a revolt was attempted. On the next day the plans of the Canal Company
agents or of some of the residents of Panama came to a head; early in
the evening a small and bloodless uprising occurred; and while the
United States kept both sides from disturbing the peace, the insurgents
set up a government which was recognized within two days, and Philippe
Bunau-Varilla, a former chief engineer of the Company, was accredited
to the United States as minister. A treaty was immediately arranged by
which the United States received the control of a zone ten miles wide
for the construction of a canal, and in return was to pay $10,000,000
and an annuity of $250,000 beginning nine years later, and to guarantee
the independence of Panama. The Secretary of State, John Hay, described
the process of drawing up the treaty in a private letter of November
19, 1903:

    Yesterday morning the negotiations with Panama were far from
    complete. But by putting on all steam, getting Root and Knox and
    Shaw together at lunch, I went over my project line by line, and
    fought out every section of it; adopted a few good suggestions:
    hurried back to the Department, set everybody at work drawing up
    final drafts--sent for Varilla, went over the whole treaty with him,
    explained all the changes, got his consent, and at seven o'clock
    signed the momentous document.

Although the Senate ratified the treaty, the action of the President
was the cause of a storm both in that body and throughout the nation.
In self-defence Roosevelt condemned Colombia's refusal to ratify the
Hay-Herran treaty and asserted that no hope remained of getting a
satisfactory agreement with that country; that a treaty of 1846 with
Colombia justified his intervention; and that our national interests
and the interests of the world at large demanded that Colombia no
longer prevent the construction of a canal. On the other hand the
President's critics called attention to the unusual haste that
surrounded every step in the "seizure" of Panama; condemned the
disposition of war vessels which prevented Colombia from even
attempting to put down the uprising; and insinuated that the
administration was in collusion with the insurgents. Roosevelt's
successors in the presidency felt there was some degree of justice in
the claim of Colombia that she had been unfairly treated by her big
neighbor and several different attempts were made to negotiate treaties
which would carry with them a money payment to Colombia. On July 29,
1919, the Foreign Relations Committee of the Senate unanimously
reported to that body the favorable consideration of a treaty providing
for a money payment of $25,000,000, but other matters intervened and no
further progress resulted.[3]

The work of constructing the waterway was delayed by changes of plan
until 1906, when a lock canal was decided upon, and shortly afterward a
start was made. So huge an undertaking--the isthmus is forty-nine miles
wide at this point--was an engineering task of unprecedented size, and
involved stamping out the yellow fever, obtaining a water supply,
building hospitals and dwellings and finding a sufficient labor force,
as well as the more difficult problems of excavating soil and building
locks in regions where land-slides constantly threatened to destroy
important parts of the work. At length, however, all obstacles were
overcome and on August 15, 1914, the canal was opened to the passage of
vessels.

The final diplomatic question relating to the canal concerned the rates
to be charged on traffic passing through. By the terms of the
Hay-Pauncefote treaty with Great Britain, the United States agreed that
the canal should be free and open to all nations "on terms of entire
equality." In 1912 Congress enacted legislation exempting American
coast-wise vessels from the payment of tolls, despite the protest of
Great Britain. As President Wilson was of the opinion that our action
had been contrary to our treaty agreement, he urged the repeal of the
act upon his accession in 1913, and succeeded in accomplishing his
purpose.

The construction of the Canal under American auspices committed the
United States to new responsibilities in the Caribbean. Her coaling
station in Cuba, the possession of Porto Rico and the protection of the
isthmus made it a matter of national safety to preserve stable
governments in Central America and the West Indies. The infiltration of
American capital into the region served to ally economic with political
interest, for like European investors, our capitalists have taken a
part in the exploitation of South American sugar, fruit, coffee, oil
and asphalt. With the islands and shores of the Caribbean Sea alone,
American trade doubled in the decade after 1903. Orderly government
south of the United States became accordingly essential to the welfare
of our outlying possessions, and to the commercial interests of a group
of investors. The most important international questions that have
arisen in Spanish America related to Venezuela in 1902 and Santo
Domingo in 1905.

Venezuela had long granted concessions to foreign investors--Germans,
English, Italians and others--in order to develop her mines, timber and
railroads, but unsettled conditions in the country frequently resulted
in the non-fulfillment of the obligations which had been entered into.
Germany, for example, claimed that the government of Venezuela had
guaranteed dividends on the stock of a railroad built by German
subjects and had failed to live up to the contract. Having in mind the
possible use of force to compel Venezuela to carry out her alleged
obligations, Germany consulted our state department to discover whether
our adherence to the Monroe Doctrine would lead us to oppose the
contemplated action. The attitude of President Roosevelt in 1901 was
that there was no connection between the Monroe Doctrine and the
commercial relations of the South American republics, except that
punishment of those nations must not take the form of the acquisition
of territory. In 1902 Germany, Great Britain and Italy proceeded to
blockade some of the ports of Venezuela, and the latter thereupon
agreed to submit her case to arbitration. Apparently, however, Germany
was unwilling to relinquish the advantage which the blockade seemed to
promise, and in the meantime Roosevelt became fearful that the result
of the blockade might be the more or less permanent occupation of part
of Venezuela. He therefore told the German ambassador that unless the
Emperor agreed to arbitration within ten days, the United States would
send a fleet to Venezuela and end the danger which Roosevelt feared.
The pressure quickly produced the desired results, and during the
summer of 1903 many of the claims were referred to commissions. The
three blockading powers believed themselves entitled to preferential
treatment in the settlement of their claims, over the non-blockading
nations, while the latter held that all of Venezuela's creditors should
be treated on an equality. This portion of the controversy was referred
to the Hague tribunal, which subsequently decided in favor of the
contention raised by Germany, Great Britain and Italy, and eventually
all the claims were greatly scaled down and ordered paid.[4]

The Venezuela case made evident the possibility that European creditors
of backward South American nations might use their claims as a reason
for getting temporary control over harbors or other parts of these
countries. There was also ground for the fear that temporary control
might become permanent possession. Hence in the Santo Domingo case, the
United States adopted a new policy. The debts of Santo Domingo were far
beyond its power to pay; its foreign creditors were insistent. An
arrangement was accordingly made by which the United States took over
the administration of the custom houses, turned over forty-five per
cent. of the income to the Dominican government for current expenses,
and used the remainder to pay foreign claims. The plan worked so well
that its main features were continued and imitated in the protectorates
over Haiti (1915) and Nicaragua (1916).

The progress which has been made in composing the jarring relations
among the American states is due in part to the Pan American Union and
to the Pan American Conferences. The Union is an organization of
twenty-one American republics which devotes itself to the improvement
of the commercial and political relations of its member states. The
first Pan American Conference, held at Washington in 1889, has already
been mentioned.[5] At the second, at Mexico City in 1901, the American
republics which had not already done so agreed to the conventions
signed at The Hague in 1899. At the third conference at Rio de Janeiro
in 1906 and the fourth in Buenos Aires in 1910, its field of effort was
further broadened, and in the latter year a recommendation was passed
that the Pan American states bind themselves to submit to arbitration
all claims for pecuniary damages.

President Wilson continued unbroken the policy of protectorates which
President Roosevelt had initiated in the case of San Domingo. His
statements of general policy were conciliatory and evidently designed
to allay suspicion, and he constantly expressed the view that the
American states were cooperating equals. And having asserted that the
United States had no designs upon territory, and nothing to seek except
the lasting interests of the peoples of the two continents, he gave
practical evidence of his purposes by urging that all unite to
guarantee one another their independence and territorial integrity,
that disputes be settled by investigation and arbitration, and that no
state allow revolutionary expeditions against its neighbors to be
fitted out on its territory.[6]

American relations with Great Britain between 1896 and 1914 were such
as to lend themselves to amicable settlement. The question of the
boundary between Alaska and Canada, to be sure, contained some of the
elements of trouble. The treaty of 1825, between Russia and Great
Britain, had established the boundary between Alaska and Canada in
terms that were somewhat ambiguous, the most important provision being
that the line from the 56th degree of north latitude to the 141st
degree of west longitude should follow the windings of the coast, but
should be drawn not more than ten marine leagues inland. The coast at
this point is extremely irregular, and the few important towns of the
region are at the heads of the bays. With the discovery of gold in the
Klondike region in 1897 and the consequent rush of population to the
coast settlements, the question of jurisdiction became important.

The claim of Great Britain was that the word "coast" should be
interpreted to include adjacent islands. Hence the ten league line
would follow the general direction of the shore but would cut across
the inlets and headlands and thus leave the towns in the possession of
Canada. The American contention was that the line should follow closely
the windings of the shore of the mainland, thus giving the United
States a continuous strip of coast. The controversy was referred in
1903 to a board composed of three Americans, two Canadians and the Lord
Chief Justice of England. On all the important points the English
representative concurred with the Americans and a line was subsequently
drawn in general conformity with our contention.[7]

The most complicated negotiation of the period, as well as one of the
most complicated in our history, concerned the North Atlantic Coast
fisheries. Under the treaty of 1818 relating to matters remaining over
from the War of 1812, the United States possessed certain rights on the
fishing grounds off Newfoundland and Labrador. From then on there was
intermittent negotiation concerning the meaning of the terms of the
treaty and the justice of fishing regulations made by Canada. In 1908
the United States and Great Britain made a general arbitration treaty,
under the terms of which the fisheries question was referred to members
of the Court of Arbitration at The Hague.[8] The award, made in 1910,
upheld the rights of American fishermen on the coasts of Newfoundland,
and recommended the establishment of a permanent fishery commission to
settle all future controversies. This was accomplished in 1912 and an
irritating and long-standing dispute was put to rest.

"Dollar diplomacy" was the chief novelty in our relations with China.
The expression was used in President Taft's administration, when his
Secretary of State, P.C. Knox, devoted much attention to promoting
loans, contracts and concessions in Central and South America, and more
particularly in China. The argument for dollar diplomacy was that it
opened new fields for the use of American capital, and thus indirectly
benefited the whole people. The President also believed that
investments in China would further American influence there and react
favorably in continuing the open-door policy which had been initiated
by Secretary Hay. The objection most commonly made was that the
government became bound up in the interests of investors and might be
compelled to interpose with armed force when difficulties arose between
the investor and the state where the investment was made.

An opportunity for large investments in China was presented during
1912-1913. In the former year a revolution in that distracted country
had come to an end and a republic had been set up with Yuan Shih-kai as
President. Since the new government was in need of funds, it undertook
to borrow through an associated group of bankers from six foreign
nations, the United States among them. The financial interests agreed
to the loan, but insisted on having a hand in the administration of
Chinese finance, so as to ensure repayment. At this point President
Wilson's administration began. The bankers at once asked him whether he
would request them to participate in the "six-power" loan, as President
Taft had done. Wilson declined to make the request, fearing that at
some future time the United States might be compelled to interfere in
Chinese financial and political affairs, whereupon the American bankers
withdrew and the six-power group subsequently disintegrated.

Relations with Japan have been a cause for negotiation on several
occasions. During the Russo-Japanese War, which came to a close in
1905, American sympathies were mainly with the Japanese. The
correspondence which brought about a cessation of hostilities was
initiated by President Roosevelt, and the peace conference was held in
Portsmouth, New Hampshire. During the course of the sessions American
sympathies shifted somewhat to the Russian side, and when the Japanese
did not receive all that they demanded of Russia they felt somewhat
dissatisfied.

A subject which seemed at times to contain unpleasant possibilities was
the restriction of Japanese immigration into the United States. The
western part of the country, especially California, has objected
vigorously to the presence of the Japanese on the coast, and as Japan
refused to agree to such a treaty as that which restricts Chinese
immigration, recourse was had to the Root-Takahira agreement of 1908,
by which the Japanese government itself undertook to prevent the
emigration of laborers to the United States. It was more difficult to
reach an agreement concerning Japanese who were already living in the
United States. In 1913 the legislature of California had before it a
law forbidding certain aliens from holding land in the state. As the
act would apply almost solely to the Japanese, the federal government
was placed in an embarrassing position. Under existing treaties the
Japanese were granted equal rights with other aliens, but the states
were able to modify the practical operation of treaty provisions, as
California planned to do, by declaring certain aliens ineligible to
citizenship and then placing particular restrictions upon them. The
Secretary of State, William J. Bryan, went to California and attempted
to persuade the state authorities to alter their land laws. Although
the law was eventually passed, it was modified to the extent of
allowing Japanese to lease agricultural lands for terms not greater
than three years.

In 1917, Robert Lansing, the American Secretary of State, and Viscount
Ishii, special ambassador of Japan, reached an important agreement
concerning American relations in the Orient. By it the United States
admitted the interest of Japan in China, but the two placed themselves
on record as mutually opposed to the acquisition by any government of
special rights in China that would affect the independence or the
territorial integrity of that country. Nevertheless Japan had already
forced China in 1915 to grant her territorial and economic concessions
that constituted a grave menace to Chinese independence, and final
settlement between the two awaited later events.

It is impossible at the present time to give an accurate account of
American relations with Mexico during the decade preceding 1920. Mexico
and Mexican affairs are but ill understood in the United States; and
the purposes and acts of the chief figure in the most important events,
President Wilson, will not be fully known until papers are made public
and explanations presented that only he can give. His conduct of
Mexican affairs, moreover, had to face constant change on account of
the outbreak and progress of a European war in 1914, and many critical
decisions had to be arrived at during 1915-1916 when political
partisanship in the United States was at fever heat and when the most
bitter opponents of the administration were ready to pounce upon every
act and hold it up to public scorn. Nor is the exact character of some
of the pressure brought to bear upon the President fully known.
American capital in vast amounts had gone into Mexico as into other
parts of Latin America. Mining companies, railroad, ranching and
plantation companies, and private individuals had invested in a land
that has been called "the storehouse of the world," because of its
fabulous resources in mineral wealth and fertile soil. In 1912
President Taft said that American investments had been estimated at one
billion dollars. President Wilson in 1916 warned the public that agents
of American property owners in Mexico were scattered along the border
originating rumors which were unjustified by facts, in order to bring
about intervention for the benefit of investors. For these reasons most
accounts of Mexican relations, whether they uphold or condemn the steps
taken by the administration, are rendered defective by prejudice or
lack of information. It is possible, therefore, to give only a bare
narrative of a few of the most important events following 1910.

The strong hand of Porfirio Diaz ruled Mexico from 1877 to 1880 and
from 1884 to 1911. The government was autocratic; the resources of the
country were in the hands of foreigners; and while a few magnates were
wealthy, the mass of the people were poor and ignorant. The country was
infested with bands of robbers, but Diaz managed to control them and
even made some of the leaders governors of states. Such was the country
that is separated from Arizona and New Mexico by an imaginary line and
from Texas by a narrow river that shrinks in summer almost to a bed of
sand.

In 1910 Francisco Madero organized a revolt, compelled Diaz to flee to
Europe in 1911, and was himself chosen President. Taft meanwhile had
sent troops to the border, stray bullets from across the line killed a
few American citizens and the demand for intervention began. Madero was
soon overthrown by General Victoriano Huerta, who became provisional
president. Shortly afterward Madero was shot under circumstances that
pointed to Huerta as the instigator of the assassination, but his
friends kept the fires of revolt alive, and Governor Carranza of
Coahuila, the state across the border from northwest Texas, refused to
recognize the new ruler. It was at this juncture that Wilson succeeded
Taft. General Huerta was promptly recognized by the leading European
nations but President Wilson refused to do so, on the ground that the
new government was founded on violence, in defiance of the constitution
of Mexico and contrary to the dictates of morality. He then sent John
Lind to Mexico to convey terms to Huerta--peace, amnesty and a free
election at which Huerta himself would not be a candidate. When the
latter refused the proposal, President Wilson warned Americans to leave
Mexico and adopted the policy of "watchful waiting," hoping that Huerta
would be eliminated through inability to get funds to administer his
government. In the meanwhile the destruction of lives and property
continued.

War was barely avoided in the spring of 1914 when a boat's crew of
American marines was imprisoned in Tampico. An apology was made, but
General Huerta refused to order a salute to the United States flag, and
troops were accordingly landed at Vera Cruz, where slight encounters
ensued. At this juncture Argentina, Brazil and Chile, "the ABC powers"
made a proposal of mediation which was accepted. The conference averted
war between the United States and Mexico, although failing to solve the
questions at issue. Shortly afterward, however, Huerta retired from the
field unable to continue his dictatorship, and the American troops were
withdrawn.

The end was not yet however. Carranza and his associate, Villa, fell to
quarreling. Bands of ruffians made raids across the border, and Mexico
became more than before a desolate waste peopled with fighting
factions. At President Wilson's suggestion six Latin-American powers
met in Washington in 1915 for conference, and decided to recognize
Carranza as the head of a _de facto_ government. Diplomatic relations
were then renewed after a lapse of two and a half years. In a message
to Congress the President reviewed the imbroglio, but expressed doubts
whether Mexico had been benefited.

His fears soon proved to be well founded. In 1916 Villa crossed into
New Mexico and raided the town of Columbus. With the consent of
Carranza the United States sent troops under General Pershing across
the line to run down the bandits, but the only result was to drive the
Villistas from the region near the border. Renewed raids, this time
into Texas, indicated the need of larger forces and the state militia
were called upon, but after nearly a year of service they were
withdrawn early in 1917. Not long afterward Carranza was elected
president for a term of four years, but in 1920 another revolt ended in
his assassination. The country is in a condition of wretchedness, and
neither life nor property is safe from bands of marauders, President
Wilson has patiently attempted to give Mexico a chance to work out her
own salvation without hindrance from other countries and without
exploitation by investors,--but the problem remains unsettled.[9]

In view of some aspects of the foreign relations of the United States
since 1914, it is apparent that such diplomatic incidents as those
concerned with boundaries, fisheries and Latin-American protectorates
were not the most important forces in determining the outlook of
America upon Europe. In spite of the huge immigration of Europeans into
America since the Civil War, the United States has seldom drawn upon
European experience and has never sought to model itself on European
lines. American legislators have not commonly studied either English or
continental practices; our institutions and our constitutional
limitations have been so peculiarly our own that slight attention has
been paid to the outside world. Even the ancient resentment against
England had dwindled by 1914, leaving the United States without any
traditional "enemy." Tradition, as well as geographical isolation,
tended to keep us apart from the currents of European action.

Nevertheless America was being inter-related with the rest of the world
through means with which the diplomats had little to do. In 1867 the
Atlantic cable had finally been placed in successful operation, and
forty years afterward the globe was enmeshed in 270,000 miles of
submarine telegraph wires. In 1901 wireless telegraphic messages were
sent across the ocean, and within a few years private and press notices
were being sent across the Atlantic, vessels were commonly equipped
with instruments, and international regulations concerning
radio-telegraphy were adopted by the chief powers of the world. Most
important of all was the constant passage of merchant vessels shuttling
back and forth between America and Europe, and weaving the two into one
commercial fabric. With Great Britain, with Germany, with France, Italy
and the Netherlands, during 1913, the United States exchanged products
valued at nearly two and a half billion dollars. This was an amount
more than twice as great as the entire trade with Europe twenty years
before. Over half a billion dollars' worth was with Germany, to which
country we sent cotton, copper, food-stuffs, lard and furs in return
for fertilizers, drugs, dyes, cotton manufactures and toys. American
corporations had branches in Germany, while German manufacturers
invested hundreds of millions of dollars in factories here. So huge a
volume of commerce concerned the welfare not only of the ordinary
commercial classes--ship owners, exporters and investors--but the much
larger number of producers, manufacturers, miners, meat-packers, and
farmers who directly and indirectly supplied the materials for export.

In the meantime a change was taking place in the attitude of America
toward world affairs. Inaccurate as it was to describe the United
States as a world power at the time of the Spanish War, nevertheless
the war itself and the colonial responsibilities which it entailed
helped to a small degree to break down the isolation of America;
frequent communication with Europe, and the expansion of American
commerce tended in the same direction.

The international relations of the United States for the twenty years
immediately preceding 1914 may then be briefly summarized. The one
international problem which interested the greatest numbers of people
was the best method of arriving at international peace. Other problems,
except the Mexican question, were simple and inconspicuous, and the
majority of Americans knew little of European politics or international
relations. Only in the fields of communication and commerce was the
United States becoming increasingly and intimately related to the
remainder of the world, and the extent to which this change
supplemented the effect of the war with Spain in broadening the
American international outlook was a matter of conjecture.


BIBLIOGRAPHICAL NOTE

The general texts mentioned at the close of Chapter XIII continue to be
useful.

On the Hague Conferences reliance should be placed upon G.F.W. Holls,
_The Peace Conference at the Hague_ (1900), by the secretary of the
American delegation; A.D. White, _Autobiography of Andrew D. White_ (2
vols., 1905), by a member of the delegation; J.W. Foster, _Arbitration
and the Hague Court_ (1904); P.S. Beinsch, in _American Political
Science Review_, II, 204 (Second Conference).

The best brief account of the acquisition of the canal strip is in
Latané; Theodore Roosevelt's story is in his _Autobiography_ and his
_Addresses and Presidential Messages_. On the Caribbean, C.L. Jones,
_Caribbean Interests of the United States_ (1916). The Venezuela
arbitrations are in _Senate Documents_, 58th Congress, 3rd session, No.
119 (Serial Number 4769). The Alaskan boundary question is clearly
discussed in Latané, with a good map, and J.W. Foster, _Diplomatic
Memoirs_ (2 vols., 1909). _The Proceedings in the North Atlantic Coast
Fisheries Arbitration_ are in _Senate Document_ No. 870, 61st Congress,
3rd session (12 vols, 1912-1913): more briefly in G.G. Wilson, _Hague
Arbitration Cases_ (1915). S.K. Hornbeck, _Contemporary Politics in the
Far East_ (1916), is useful for Asiatic relations. Ogg, Fish, and the
_American Year Book_ provide material on Mexican affairs.

       *       *       *       *       *

[1] The Presidents and Secretaries of State during this period were as
follows:

    McKinley, 1897-1901; John Sherman, William R. Day, John Hay.
    Roosevelt, 1901-1909; John Hay, Elihu Root, Robert Bacon.
    Taft, 1909-1913; P.C. Knox.
    Wilson, 1913-1921; W.J. Bryan, Robert Lansing, B. Colby.

[2] The French company had a concession on the isthmus and had already
done considerable work.

[3] Roosevelt, after his retirement from office was widely reported as
having said in an address at the University of California: "If I had
followed traditional, conservative methods, I would have submitted a
dignified state paper of probably two hundred pages to Congress, and
the debate on it would have been going on yet; but I took the Canal
Zone and let Congress debate." Cf. Jones, _Caribbean Interests_,
238-239.

[4] For the Roosevelt "threat," together with another version of the
story, cf. Thayer, _Hay_, II, 284-289 and _North American Review_,
Sept., 1919, 414-417, 418-420.

[5] Above, p. 289.

[6] The latest acquisition of the U.S. in the Caribbean Sea was the
Virgin Islands which were purchased from Denmark in 1916.

[7] The American members of the Commission were Elihu Root, who was
then Secretary of War, Senator H.C. Lodge, and ex-Senator George
Turner. The English member was the Lord Chief Justice, Baron
Alverstone; the Canadians were Sir Louis Amable Jetté, Lieutenant
Governor of Quebec, and Allen B. Aylesworth of Toronto.

[8] The American member of the tribunal was Judge George Gray. The
closing argument for the United States was made by Elihu Root. Robert
Lansing was one of the associate counsel.

[9] The number of Americans killed in Mexico as given by the ambassador
in 1919 was as follows: 1911, 10; 1912, 6; 1913, 24; 1914, 30; 1915,
26; 1916, 46; 1917, 39; 1918, 31. N.Y. _Times_, July 20, 1919. For the
revolution of 1920 consult N.Y. _Times_, May 16 ff.




CHAPTER XXIV


WOODROW WILSON

A definite account of the eventful years following 1913 can be written
only after time has allayed partisanship; after long study of the
social, economic and political history has separated the essential
from the trivial; after papers that are now locked in private files
have been opened to students; and after the passage of years has given
that perspective which alone can measure the wisdom or the folly of a
policy. It will be little less difficult to make a just appraisal of
the chief American participants in those years, and particularly of
President Woodrow Wilson. At present it is possible only to avoid
partisanship so far as it can be done, read with open mind whatever
documents are available, and refrain from either praise or condemnation.
On all sides it is agreed that during his administration Wilson
became one of the three or four world-figures, and for that reason
his characteristics, as well as the events of his presidency demand
unusual attention.

Woodrow Wilson was born in Staunton, Virginia, in 1856. His ancestors
were Scotch-Irish and his father an educator and Presbyterian
clergyman. After graduating from Princeton College he practiced law,
studied history and politics, and taught these subjects at several
different institutions. Subsequently he became a professor at
Princeton and later its President. He was a prolific and successful
writer. His book on _Congressional Government_, for example, went
through twenty-four impressions before he became President of the
United States. _The State_, an account of the mechanism of government
in ancient and modern times, and some of his portrayals of American
history were hardly less in demand. His election as Governor of New
Jersey in 1910 and his election to the presidency two years later have
already been mentioned.

The outstanding characteristic of Wilson is a finely-organized,
penetrating intelligence. Somewhat like a silent chess-player he
thinks many moves in advance, a fact which makes it difficult to judge
a single act of his without a knowledge of the whole plan. Before
coming to the presidency he had long pondered on the proper and
possible function of that office, and had drawn in imagination the
outlines and many of the details of the role which he was to play.
Years of careful study had drilled him in the accumulation of facts.
As a specialist in polities and history he was accustomed to make up
his mind on the basis of his own researches, and to change his
judgments without embarrassment when new facts presented themselves.
His literary style is characterized by precision, a close texture and
frequently by suppressed emotion. He thinks on an international scale
and with a profundity that often dwarfs associates who are by no means
pygmies themselves. An unbending will, an alert conscience, stubborn
courage, restrained patience, political sagacity, a thoroughgoing
belief in democracy and above all an instinctive understanding of the
spiritual aspirations of the common people made him the most powerful
political figure in America within a brief time after his accession to
the presidency. On the other hand, his aloofness from counsel during
the later part of his presidency exceeded that of Cleveland, and his
abnormal self-reliance was greater than that of Roosevelt.

In reviewing the history of the years following 1913, it is necessary
to have a sense of the immensity of the problems involved, as well
as a restrained judgment and some knowledge of the chief actors.
Beginning in 1914, the great nations of Europe were constantly menaced
by appalling dangers; their leaders were daily confronted with
decisions of the utmost importance. Because of the close commercial,
industrial and financial bonds between the two continents, America
could not fail to be affected. She too was compelled to take her part
in a drama which was far greater than any in which she had before
engaged. Both the President and Congress were confronted with problems
the solution of which would vitally affect not only the people of
America, but the people of the world; never before had their decisions
been so subject to the possibilities of mistakes which would certainly
be momentous and might be tragic.

When Wilson and his party came into power in 1913, as the result of
the schism among the Republicans, their position was by no means
secure. The President had been elected by a distinct minority in the
popular vote and his practical political experience had been less than
that of any chief executive since Grant. His party had been in power
so little since the Civil War that it had no body of experienced
administrators from which to pick cabinet officers, and no corps of
parliamentary leaders practiced in the task of framing and passing a
constructive program. The party as a whole was lacking in cohesion
and had perforce played the role of destructive critic most of the
time for more than half a century; its principles were untested in
actual experience, and although its majority in the House was large,
in the Senate its margin of control was so narrow as to suggest the
near possibility of the failure of a party program. Wilson was under
no illusions as to the circumstances of his election and he realized
that both he and his party were on probation.

The appointment of the cabinet occasioned unusual interest. Bryan, the
one Democrat who had a large and devoted personal following, became
Secretary of State. His influence in nominating Wilson had been very
great and the adherence of his admirers was necessary if the party was
to be welded into an effective organization. Several of the other
members of the cabinet proved themselves to be men of unusual
capacity, and their ability to cooperate with one another provided
the "teamwork" which the President was anxious to obtain.[1]

His conception of the part which the chief executive ought to play
was a definite one. He looked upon the President as peculiarly the
representative of the whole people in the federal government, as the
leader of the party in power and as commissioned by the voting
population to carry out the platform of principles upon which the
party and its leader were elected. He believed that the unofficial
leaders who are better known as "bosses" existed partly because of the
absence of official leaders. As Governor of New Jersey he had acted on
the principles that he had outlined for the chief executive of the
nation, and upon his accession to the presidency he began at once to
put into effect a similar program.

Congress was called for a special session on April 7, 1913, in order
to revise the tariff. It was a dangerous task--one which had
discredited the Democrats in 1894 and divided the Republicans in
1909--but plans had been laid with care in order to avoid previous
mistakes. The Chairman of the Committee on Ways and Means in the
House, Oscar W. Underwood, had begun the preparation of a bill during
the session before and had discussed it with Democratic members of the
Senate Committee on Finance, and with the President.

At the opening of the session Wilson broke the precedent established
by Jefferson in 1801, and read his message personally to Congress,
instead of sending it in written form to be read by a clerk. In
substance the message expressed the President's conviction that the
appearance of the chief executive in Congress would assist in
developing the spirit of cooperation, and outlined the tariff problem
which they were together called upon to settle. He declared that the
country wished the tariff changed, that the task ought to be completed
as quickly as possible and that no special privileges ought to be
granted to anybody. He advocated a tariff on articles which we did not
produce and upon luxuries, but he urged that otherwise the schedules
be reduced vigorously but without undue haste. Other considerations
were more important, however, than the substance of the message.
Previous documents of this kind had been long and filled with a wide
variety of recommendations concerning both international and domestic
relations; Wilson's speech occupied but a few moments, it focused the
attention of Congress upon one subject, and fixed the eyes of the
country upon the problem. The nation knew that one task was in hand,
and knew where to lay the blame if delay should ensue. It was a great
responsibility that the President had assumed, but he assumed it
without hesitation.

Underwood presented his bill at once and it passed the House without
difficulty, but in the Senate the Democratic majority of six was too
small to guarantee success in the face of the objections of Louisiana
senators to the proposal for free sugar, and the usual bargaining for
the protection of special interests. When the lobby appeared--the
group that had so mangled the Wilson-Gorman bill and discredited the
Payne-Aldrich Act--the President issued a public statement warning the
country of the "extraordinary exertions" of a body of paid agents
whose object was private profit and not the good of the public. So
vigorous an action resulted in hostility to Wilson, but Congress found
itself unusually free from objectionable pressure. Hence while experts
differed in regard to the wisdom of one part or another of the bill,
it was not charged that its schedules bore the imprint of favoritism
for any particular private interests. Discussion in the Senate was so
extended that the Underwood act did not finally pass and receive the
President's signature until October 3.

The general character of the measure is indicated by the number of
changes made in the tariffs as they existed at the time of the passage
of the act. On 958 articles the duties were reduced; on 307 they were
left unchanged; and on eighty-six (mainly in the chemical schedule),
they were increased. Despite the numerous reductions, the Underwood
law retained much of the protective purpose of preceding enactments.
Attempts were made to decrease the cost of living by considerable
reductions on certain agricultural products and by placing others on
the free list; wool was to be free after December 1, 1913, and the
duty on sugar was to be reduced gradually and taken off completely on
May 1, 1916; duties on cotton goods and on woolens ("Schedule K") were
heavily reduced. Underwood represented an iron manufacturing section
of Alabama, but he showed an uncommon attention to the general
interest by favoring large reductions on pig-iron and placing iron ore
and steel rails on the free list. An important part of the law was a
provision for an income tax, which had been made possible by the
Sixteenth Amendment to the Constitution proclaimed on February 25,
1913. Incomes over $3,000 ($4,000 in the case of married persons),
were to be taxed one per cent., with an additional one per cent. on
incomes of $20,000 to $50,000, and similar graded "surtaxes" on higher
incomes, reaching six per cent. on those above $500,000. The board
which the Republicans had established for the scientific study of the
tariff had been allowed to lapse by the Democrats, but was revived in
1916 through the appointment of a bi-partisan Commission of six
members with twelve-year terms.

On June 23, 1913, after the tariff bill had been piloted around the
chief difficulties in its way, the President again addressed
Congress-this time on currency legislation. Again he laid down certain
principles-a more elastic currency, some means of mobilizing bank
reserves, and public control of the banking system. Before mentioning
the further history of this recommendation, however, it is necessary
to have in mind the main facts in the development of the monetary
issue since 1900. Complaint had been common since that year. One
difficulty lay in the fact that the volume of the currency could not
quickly increase and decrease as busy times demanded more or quiet
times required less of the circulating medium. At those parts of the
year, for example, when the crops were being moved there was a greater
demand for currency than the banks could conveniently meet. They
could, to be sure, buy United States bonds and issue national bank
notes upon them as security, but this was a slow and costly process.
The dangers of the existing inelastic arrangement were illustrated in
the panic of 1907.

In that year occurred a financial crisis which resulted in business
failures, unemployment and the indictment of prominent figures in the
commercial world; it was precipitated by a gamble in copper stocks. An
unsuccessful attempt to corner the stock of a copper company led to
the examination of the Mercantile National Bank of New York, with
which the speculators had intimate connections. Meanwhile the
president of the bank and all the directors were forced to resign. One
of the associates of a director in the Mercantile was the president of
the Knickerbocker Trust Company, and depositors in the latter bank
thereupon became frightened, and $8,000,000 were withdrawn in three
hours. The alarm then spread to the depositors of the Trust Company of
America--the president of the Knickerbocker was one of its
directors--and $34,000,000 were withdrawn by the now thoroughly
anxious depositors, who stood in line at night in order to be ready
for the next day. The panic spread to other parts of the nation;
country banks withdrew funds from the city banks, and they from New
York; and at length the government came to the aid of the distressed
institutions and deposited $36,000,000 between October 19 and 31.
Nevertheless, at the time when depositors were trying to get their
money there was sufficient currency in existence to satisfy all needs.
The defect lay in the lack of machinery for pooling resources in such
a way as to relieve any institution that was in temporary straits. The
experts pointed also to the unscrupulous manipulation of the supplies
of currency by New York financiers. There was widespread comment on
the fact that if the magnates did not actually constitute a "money
trust" they were nevertheless able to expand and contract the
available supply to such an extent as to serve their own ends and
embarrass the public.

In the meanwhile many experts, among them Senator Nelson W. Aldrich,
had been studying the entire banking system. The result of this work
was the Aldrich-Vreeland Act of 1908 providing a temporary method for
making the supply of currency more flexible and also arranging for a
National Monetary Commission to investigate the currency and banking
systems in this and other countries. The Commission published
thirty-eight volumes of information and recommendations, which were a
storehouse of facts concerning the problem, although no legislation
resulted. All that Taft did was to pass the task along to Wilson.

As has been seen, President Wilson seized the opportunity at once.
Senator Owen and Carter Glass, Chairmen of the Senate and House
Committees on Banking and 'Currency, together with William G. McAdoo,
the Secretary of the Treasury, and the President himself drafted the
Federal Reserve bill. This measure received careful attention, being
the cause of extended hearings and debate in Congress and of
discussion in banking circles. The special session wore on and came to
an end, but the regular session began at once (December 1), and
consideration of the measure continued without interruption. At length
on December 22 the House acted favorably, thirty-four Republicans,
eleven Progressives, and one Independent assisting the Democrats in
passing the bill; on the following day the Senate passed it, one
Progressive and three Republicans voting with the majority. In many
details the act as passed differed from the original plan, but in its
essential points it was not amended. Although its precise form was the
work of a few men, the project in general, of course, represented the
labors of many persons extending over many years, and for that reason
embodied the best that American experts could give.

The Act provided for the establishment of Federal Reserve Banks, to be
placed in districts--the number being eventually fixed at twelve. The
capital for each Reserve Bank was to be supplied by the banks in its
district which became member banks. In other words the Reserve Banks
were to act as banks for their members, but not for private
individuals. In control of the twelve was a Federal Reserve Board,
composed of the Secretary of the Treasury, the Comptroller of the
Currency and five persons appointed by the president for terms of ten
years. It was at this point that the chief controversies raged between
the bankers and the proponents of the administration measure. The
bankers desired one central bank, which the administration opposed
because it feared centralized control over the currency supply; and
the bankers disliked the proposal for a Reserve Board appointed by the
president, because they apprehended the entrance of politics into the
appointments. The President and his supporters were determined,
however, not to allow the bankers to appoint the Board or any portion
of it, because they wished the system to be operated solely in the
public interest.

Greater elasticity was given to the currency supply through the
issuance of federal reserve notes, at the discretion of the Federal
Reserve Board, to the several regional Federal Reserve Banks. These
notes were to be obligations of the government and were expected to
replace the former national bank notes. When a local bank requires
more currency it may deposit with the Federal Reserve Bank such
valuable commercial paper as may be acceptable--for example,
promissory notes of reliable business firms--and receive at once a
supply of federal reserve notes. When business is brisk and large
supplies of currency are demanded, the local banks will deposit
whatever paper may be necessary to meet their needs; when the
emergency has passed they will withdraw notes from circulation, return
them to the reserve bank and receive their paper again.[2] The second
great purpose of the new system was to supply central reservoirs for
the storage of the reserves of the member banks. Each local bank is
required to keep certain prescribed balances in the reserve bank of
its district, and the federal government may also deposit funds in it.
In conformity with strict regulations the reserves thus accumulated in
a Federal Reserve Bank may be directed here and there in the district
as needed, and even from district to district, under the control of
the Federal Reserve Board. Moreover they are not available for those
speculative ventures which have caused so much trouble in the past.[3]
The operation of the law has apparently more than met the expectation
of its friends. It had hardly been established when a war broke out in
Europe, but the unusual financial situation which resulted in America
was cared for without great strain.

The third major plank in the Democratic platform of 1912 called for
legislation concerning trusts, and the President accordingly turned
his attention to that topic in his address to Congress on January 20,
1914. He declared that there was no intent to hamper business as
conducted by enlightened men, but that, on the contrary, the
antagonism between business and government had passed. He recommended
the prohibition of interlocking directorates by which railroads, banks
and industrial corporations became allied in one monopolistic group,
and he suggested that the processes and methods of harmful restraint
of trade be forbidden item by item in order that business men might
know where they stood in relation to the law. Finally, he believed
that the country demanded a commission which should act as a clearing
house for facts relating to industry and which should do justice to
business where the processes of the courts were inadequate. The
results of this undertaking were the Federal Trade Commission act of
September 26, 1914, and the Clayton Anti-trust act of October 15.

The former of these laws created a Commission of five persons to
administer the anti-trust laws and to prevent the use of unfair
methods by any persons or corporations which were subject to the
anti-trust laws. Whenever it had reason to believe that such
expedients were being used, the Commission was to issue an order
requiring the cessation of the practice. If the order was not obeyed,
the Commission was to apply for assistance to the circuit court of
appeals in the district where the offense was alleged to have been
committed. The purpose of the provision was evidently to prevent
unfair practices rather than to punish them. Another section of the
law empowered the Commission to gather information concerning the
practices of industrial organizations, to require them to file reports
in regard to their affairs, and to investigate the manner in which
decrees of the Courts against them were carried out. Under direction
of the president or Congress, the Commission could investigate alleged
violations of the law, and on its own initiative it might report
recommendations to Congress for additional legislation.[4]

The Clayton act specifically prohibited many of the practices common
to industrial enterprises. Sellers of commodities were forbidden to
discriminate in price between different purchasers--after making due
allowance for differences in transportation costs; corporations were
forbidden to acquire any of the stock of other similar industries,
where the effect would be substantially to lessen competition; and
directors of banks and corporations were prohibited, with stated
exceptions, from serving in two or more competing organizations. The
Clayton act also settled, at least for the time, several of the
complaints raised by the labor interests, especially at the time of
the Pullman strike. Labor and agricultural organizations were
specifically declared not to be conspiracies in restraint of trade;
injunctions were not to be granted in labor disputes unless necessary
to prevent irreparable injury; and trials for contempt of court were
to be by jury, except when the offense was committed in the presence
of the court. The law also prohibited the railroads from dealing with
concerns in which their directors were interested, except under
specified conditions.

The success of the President in pushing his party program made his
prestige the outstanding fact in politics. His leadership was
indisputable and it was evident that he regarded a party platform as a
serious program, to the fulfilment of which the party was committed by
its election. While the trust legislation was under discussion,
however, he asked for an act which required all the strength that he
could muster.

It will be remembered that the Panama Canal act of 1912 had exempted
American coast-wise traffic through the canal from the payment of
tolls. The law had been passed under a Republican, President Taft, and
both the Progressive and Democratic platforms of 1912 had favored
exemption. On March 5, 1914, Wilson appeared before Congress and urged
the repeal of the act on the ground that it was a violation of that
part of the treaty with Great Britain in which this country agreed
that the canal should be open to all nations upon an equality, and
that it was based on a mistaken economic policy. He was opposed by
Underwood and Champ Clark, two of the most powerful Democratic
leaders, but he had the aid of Senator Root, a distinguished
Republican who had been Secretary of State under President Roosevelt,
and in the end he was victorious. The division in the party was
quickly healed and forgotten.

The Congressional elections of 1914 greatly reduced the Democratic
majority in the House, although leaving control with that party, but
they slightly increased its margin in the Senate. European affairs and
the election of 1916 occupied political attention during the second
half of the administration, nevertheless the President and Congress
proceeded with their program of legislation. Important acts were those
providing for the development of the resources of Alaska, the Newlands
act for the arbitration of disputes among railway employees, a law
providing for federal aid in the building of state highways, measures
giving a larger amount of self-government to the Philippines and Porto
Rico, and one establishing a series of Federal Farm Loan Banks
intended to enable the agricultural population to get capital at low
rates of interest.[5] The major items, as well as the smaller ones in
the Democratic program were in line with many of the proposals made by
the Progressives in their platform in 1912. Attracted by these
accomplishments and by the forceful leadership of the President large
numbers of the Progressives made the transition into the Democratic
party, and from 1913 to 1916 much of the political strategy of both
Democrats and Republicans was devoted to attracting the insurgent wing
of the Republican organization.

The enactment of such a body of legislation, with the resulting
appointment of many officials and clerks, brought the President face
to face with the same civil service problem that had caused so much
trouble for Cleveland. Upon their accession in 1913 the Democrats had
been out of power so long that they exerted the pressure, usual under
such circumstances, for a share in the offices. The merit system,
however, was even more firmly entrenched than in 1897 when Cleveland
had made such additions to the classified lists, for both Roosevelt
and Taft had extended the merit principle to certain parts of the
consular and diplomatic service. Roosevelt had also made considerable
extensions in the application of the system to deputy collectors of
internal revenue, fourth-class postmasters, and carriers in the rural
free-delivery service; Taft had also increased the number of employees
who were appointed under the merit system, notably about 36,000
fourth-class postmasters not touched by his predecessor. Some of the
acts passed early in President Wilson's administration--the Federal
Reserve law, for example--expressly excepted certain employees from
civil service examinations. Bryan, as Secretary of State, showed a
lack of devotion to the cause of reform in the conduct of his
department. On the other hand the President took a most important step
in relation to postmasters of the first, second and third classes,
which had always been appointed by the president with the advice and
consent of the Senate, and had been among the plums in the gift of the
executive that had been most sought after. On March 31, 1917, Wilson
announced that thereafter the nominees for postmasters of the first
three classes would be chosen as the result of civil service
examination.

While the United States was absorbed, in these various ways, in the
task of internal construction, an event was occurring in a town in
Bosnia which was destined to affect profoundly the course of American
history. On June 28, 1914, Archduke Franz Ferdinand, the heir-apparent
to the throne of the Austro-Hungarian monarchy was assassinated by a
youth of Serbian blood and sympathies in Sarajevo. In Austria the act
was looked upon as an incident in a revolutionary movement intended to
detach a part of the Austro-Hungarian monarchy and unite it with
Serbia. A month later Austria declared war on Serbia, and in a brief
time, such was the state of the European alliances, Austria and
Germany were opposed to Serbia, Russia, Belgium, France, Montenegro
and Great Britain in a devastating war. In August, Japan joined the
"Allies," as the nations on Serbia's side were known, and Turkey, in
November, took the side of the Teutonic powers. The act that brought
Belgium into the war was of interest to the United States. Germany had
declared war on Russia, the friend of Serbia, and expected that
France, Russia's ally, would step into the fray. Being thoroughly
prepared for war, Germany believed that she could crush France before
the latter could take any effective steps. The most convenient path
into France lay through Belgium, a small, neutral nation with no
interest in the conflict, and the German armies were thereupon poured
across the boundary. High German authority freely admitted the wrong
of the act, but excused it on the ground of military necessity.
Belgium felt that she could not do otherwise than resist the invader
and was thus drawn into the vortex. Her danger helped bring Great
Britain into the conflict.

The relation of the United States to the conflict seemed remote, and
President Wilson on August 4 issued a formal proclamation of
neutrality, which was soon followed by an address to the people of the
country urging them to be neutral both in thought and in act. For a
time it was not difficult for the country to obey the injunction.
Although stories of the ruthlessness, of the German soldiery in
Belgium poured into the columns of American periodicals, the people
found difficulty in believing them because they had long admired the
efficiency and virility of the Germans. Scarcely a year before the war
broke out, ex-Presidents Roosevelt and Taft had extolled the German
Emperor as an apostle of peace, and President Butler of Columbia
University had declared that the people of any nation would gladly
elect him as their chief executive. More than a month and a half after
the invasion of Belgium, Roosevelt published an article in _The
Outlook_ in which he expressed pride in the German blood in his veins,
asserted that either side in the European conflict could be sincerely
taken and defended, and continued:

    When a nation feels that the issue of a contest in which ... it
    finds itself engaged will be national life or death, it is
    inevitable that it should act so as to save itself.... The rights
    and wrongs of these cases where nations violate the rules of
    abstract morality in order to meet their own vital needs can
    be precisely determined only when all the facts are known and
    when men's blood is cool.... Of course it would be folly to jump
    into the gulf ourselves to no good purpose; and very probably
    nothing that we could have done would have helped Belgium. We
    have not the smallest responsibility for what has befallen her.

In view of the mass of conflicting rumors concerning the war, which
reached American attention, it was natural to take the neutral
position adopted by Roosevelt, but it was inevitable, because of our
racial diversities, that sympathies and opinions should soon differ
widely. Within a short time, pamphlets were published containing the
correspondence among the several European powers which had taken place
just before the outbreak of the war. These and other documents were
widely studied in the United States and led to the belief that
England, France and Russia had been the real peace lovers and that
Germany had been the aggressor.

The immediate economic effect of the war, in the meanwhile was the
unsettlement of American financial and industrial affairs, but when
the English navy obtained the mastery of the seas, the vessels of the
Teutonic powers were driven to cover in neutral ports or kept
harmlessly at home, and American trade with neutral nations and the
Allies took on new life. Moreover the latter were in need of food,
munitions and war materials of all kinds and they turned to American
factories. Manufacturers who could accept "war orders" began at once
to make fortunes; wages and prices rose, and it became evident that
the United States would be profoundly affected by the struggle.
England's control of the sea, moreover, early presented other
problems. According to international practice, both sides in the
European conflict might purchase munitions from neutrals, of which the
United States was the largest, but on account of her weakness on the
sea Germany was unable to take advantage of this opportunity, while
the Allies constantly purchased whatever supplies were needed. At
first, the German government protested through diplomatic channels,
but our government was able to show not only that international
practice approved the course followed by the United States, but also
that Germany had herself followed it in previous wars.

There then followed propaganda on a large scale by German agents
under the direction of Dr. Bernhard Dernburg, which was intended to
influence public opinion to demand the prohibition of the shipment of
munitions to the Allies. As this activity failed of its purpose,
resort was then had to fraudulent clearance papers by which military
supplies for German use were shipped from the United States without
conforming to our customs regulations; bombs were placed in ships
carrying supplies to England; fires were set in munitions factories;
strikes and labor difficulties were fomented by German agents and at
length the government had to ask for the recall of the Austrian
Ambassador, Dr. Dumba, and the German military and naval _attachés_
at Washington, Captain Franz von Papen and Captain Karl Boy-Ed.

Relations with the Allies, in the meantime, were far from
satisfactory. The unprecedented scale on which the war was being
fought made huge supplies of munitions, food and raw materials such as
copper and cotton absolute necessities. England was able to shut off
the direct shipment into Germany of stores having military value, but
this advantage was of little use so long as the ports of Holland and
the Scandinavian countries were open to the transit of such supplies
indirectly to Teutonic soil. When England attempted to regulate and
restrict trade with these countries, the United States was the chief
sufferer. Ships were held up and their cargoes examined-during 1915,
for example, copper valued at $5,500,000 was seized while on the way
from the United States to neutral nations. On December 26, 1914, the
United States protested against the number of vessels that were
stopped, taken into British ports and held, sometimes, for weeks; and
in reply England pointed out the large increase in the amount of
copper and other materials sent to countries near Germany, and
declared that the presumption was strong that these stores were being
forwarded to the enemy.

With her navy driven from the seas, Germany began to feel the effects
of the blockade, and accordingly turned to the submarine as the hope
for victory. On February 4, 1915, Germany declared the English channel
and the waters around Great Britain a war zone, in which enemy
merchant vessels would be destroyed "even if it may not be possible
always to save their crews and passengers." Great Britain replied on
March 11 by an order that merchant vessels going into Germany or out
of her ports, as well as merchant vessels bound for neutral countries
and carrying goods bound for the enemy, must stop at a British or
allied port. At these points the cargoes were looked over and any war
materials or goods which were regarded as "contraband" were seized.
Even though the owners were eventually reimbursed for the cargoes
taken, the delay and the interference with trade were burdensome, and
the United States accordingly protested that England was establishing
an illegal blockade and that the United States would champion the
rights of neutrals. Some slight retaliatory legislation aimed at the
Allies was passed by Congress, but for the most part interest in this
controversy died in the face of the growing irritation with Germany.
The German declaration of February 4, 1915, in regard to submarine
warfare caused an energetic protest by the United States on the ground
that an attack on a vessel made without any determination of its
belligerent character and the contraband character of its cargo would
be unprecedented in naval warfare. The American note declared Germany
would be held to a "strict accountability" for any injury to American
lives and property. Nevertheless, the results of the submarine
campaign began to appear at once, and in ten weeks sixty-three
merchant ships belonging to various nations were sunk, with a loss of
250 lives. On May 7 the United States was astounded to hear that the
passenger ship _Lusitania_ had been torpedoed, and 1,153 persons
drowned, including 114 Americans. The allied and neutral nations were
profoundly stirred, and from that moment there grew an increasing
demand in the United States for war with Germany. The President called
for a disavowal of the acts by which the _Lusitania _and other vessels
had been sunk, all possible reparation, and steps to prevent the
recurrence of such deeds.

Within a few days of the _Lusitania _catastrophe and before the
protest of our government was made public, President Wilson spoke in
Philadelphia, and in the course of his remarks said, "There is such a
thing as a man being too proud to fight." The address had no relation
to the international situation, and moreover the objectionable phrase
carried an unexpected and different meaning when separated from its
context and linked to the _Lusitania_ affair. The words were seized
upon by the President's critics, however, as an indication of the
policy of the government in the crisis and were severely condemned. On
the other hand the formal protest was received with marked
satisfaction. It was understood to be the work of Wilson himself, who
practically took over the conduct of the more important foreign
affairs. When the German government replied without meeting the
demands of the President, he framed a second note which brought the
possibility of war so near that Secretary Bryan resigned rather than
sign it.[6] A second reply merely prolonged the controversy and Wilson
thereupon renewed his demands and declared that a repetition of
submarine attacks would be regarded as "deliberately unfriendly." The
statement brought the nation appreciably nearer war, but if the
comments of the newspaper press may be relied upon as an index of
public opinion, the President had again expressed the feelings of the
people. In the meanwhile German submarine warfare was modified in the
direction desired by the United States. Instead of sinking merchant
vessels on sight and without warning, the commanders of submarines
stopped them, visited and searched them, and gave the passengers and
crews opportunity to escape. On August 19, 1915, the _Arabic _was sunk
without warning, but the German government in conformity with its new
policy disavowed the act, apologized and agreed to pay an indemnity
for American lives lost. The negotiations concerning the _Lusitania_
continued to drag on, but otherwise relations between Germany and the
United States had reached the point where peace could be maintained if
no further accident or provocation intervened.

Despite the general approval of the President's firm stand against
Germany, there was an inclination in some quarters to do everything
possible to avoid a conflict, even if the effort necessitated the
relinquishment of rights that had hitherto been well recognized. In
February, 1916, Representative McLemore introduced a resolution
requesting the President to warn American citizens to refrain from
traveling on armed belligerent vessels, whether merchantmen or
otherwise and to state that if they persisted they would do so at
their own peril. The House, according to the Speaker, was prepared to
pass the resolution. The positions taken on this subject by the
administration had not been entirely consistent, but the President was
now holding that Americans had the right under international law to
travel on such vessels and that the government could not honorably
refuse to uphold them in exercising their right. "Once accept a single
abatement of right," he asserted, "and many other humiliations would
certainly follow, and the whole fine fabric of international law might
crumble under our hands piece by piece." Moreover he felt that the
conduct of international relations lay in the hands of the executive
and that divided counsels would embarrass him in dealing with Germany.
He therefore asked the House to discuss the McLemore resolution at
once and come to a vote. Under this pressure the House gave way and
tabled the resolution, ninety-three Republicans joining with 182
Democrats against thirty-three Democrats and 102 Republicans.

On March 24 the French channel steamer _Sussex_ was sunk, with the
loss of several Americans, and the submarine issue was thus brought
forward again. The President accordingly appeared before Congress and
reviewed the entire controversy. "Again and again," he reminded his
hearers, "the Imperial German Government has given this Government its
solemn assurances that at least passenger ships would not be thus
dealt with, and yet it has again and again permitted its undersea
commanders to disregard those assurances with entire impunity." He
asserted that America had been very patient, while the toll of lives
had mounted into the hundreds, and informed Congress that he was
presenting a warning that "unless the Imperial German Government
should now immediately declare and effect an abandonment of its
present methods of warfare against passenger and freight carrying
vessels this Government can have no choice but to sever diplomatic
relations with the Government of the German Empire altogether." The
_Lusitania _notes, the _Sussex_ address and other speeches made by the
President wore read all over the United States and, indeed, throughout
a great part of the world. He was attempting the novel and daring
experiment of framing a foreign policy in public view, and was thus
becoming the recognized spokesman of the neutral world.

Our international relations were in a disturbed and critical condition
when the presidential campaign of 1916 came on. The Republicans and
the Progressives planned to meet in Chicago on June 7 for the
nomination of candidates, in the hope that the two parties might unite
upon a single nominee and platform, and thus defeat Wilson who was
sure to be the Democratic candidate. At first, however, the two wings
of the Republican party were in complete disagreement. As far as
principles went they had not thoroughly recovered from the schism of
1912. For their candidate the Progressives looked only to Roosevelt,
whom the Republicans would not have. Roosevelt himself refused to
enter any fight for a nomination and announced, "I will go further and
say that it would be a mistake to nominate me unless the country has
in its mood something of the heroic." After conferences between
Republican and Progressive leaders which failed to bring about
unanimity, the Republican convention nominated Justice Charles E.
Hughes of the Supreme Court, and the Progressives chose Roosevelt.
Hughes was a reformer by nature, recognized as a man of high
principles, courageous, able and remembered as a vigorous and popular
governor of New York.

The Republican platform called for neutrality in the European war;
peace and order in Mexico, preparedness for national defence, a
protective tariff and women's suffrage. It also advocated some of the
economic legislation favored by the-Progressives in 1912. The
Progressive platform laid most emphasis on preparation for military
defence-a navy of at least second rank, a regular army of 250,000 and
a system for training a citizen soldiery. It also urged labor
legislation, a protective tariff and national regulation of industry
and transportation. The Republican platform severely denounced the
administration, but the Progressives stated merely their own
principles.

In the course of his actions after the nomination, however, Roosevelt
indicated his belief that the public welfare demanded the defeat of
the Democrats. He declared that he did not know Hughes's opinions on
the vital questions of the day and suggested that his "conditional
refusal" be put into the hands of the National Progressive Committee
and that a statement of the Republican candidate's principles be
awaited. If these principles turned out to be satisfactory then
Roosevelt would not run; otherwise a conference could be held to
determine future action. Subsequently Roosevelt issued a declaration
expressing his satisfaction with Hughes, condemning Wilson and urging
all Progressives to join in defeating the Democrats. Such an action
would, of course, spell the doom of the Progressives as a political
organization, but he declared that the people were not prepared to
accept a new party and that the nomination of a third party candidate
would merely divide the Republicans and ensure a Democratic victory.
The action of Roosevelt commended itself to a majority of the National
Committee, but a minority were displeased and supported Wilson.

The Democrats met at St. Louis on June 14 and renominated President
Wilson in a convention marked by harmony and enthusiasm. For the first
time in many years the party could point to a record of actual
achievement and it challenged "comparisons of our record, our keeping
of pledges, and our constructive legislation, with those of any party
at any time." After recalling the chief measures passed during the
administration, the party placed itself on record as favoring labor
legislation, women's suffrage, the protection of citizens at home and
abroad, a larger army and navy and a reserve of trained citizen
soldiers.[7]

The campaign turned upon the question whether the country approved
Wilson's foreign policy, rather than upon the record of the Democratic
party and its platform of principles, and in such a contest each side
had definite advantages. As the candidate of the party which had been
in power most of the time for half a century, Hughes had the support
of the two living ex-presidents and the backing of a compact
organization with plenty of money. He had been out of the turmoil of
politics for six years as a member of the Supreme Court and hence had
not made enemies. His party was strong in the most populous portions
of the country and in the East where dissatisfaction with the
President's foreign policy was strongest. In particular the unhappy
Mexican difficulty, which has already been mentioned, had not been
settled, and it was an easy matter for Hughes to point out real or
alleged inconsistencies and mistakes in his opponent's acts. Wilson
had been elected four years before by a minority vote and had served
through a term of years that had brought forward an unusual number of
perplexing questions on which sincere men disagreed, and had,
therefore, aroused a host of enemies. On the other hand, he had the
advantage of being in power, and his supporters could urge the danger
of "swapping horses while crossing a stream." He had a foreign policy
which the people knew about, experience in the Presidency and a record
for leadership in constructive accomplishment.[8]

The particular characteristics of the campaign were mainly the results
of the activities of Hughes, Roosevelt and Wilson. In his speech
accepting the nomination Hughes attacked the record of the
administration in regard to the civil service, charged the President
with interfering in Mexican affairs without protecting American
rights, and asserted that if the government had shown Germany that it
meant what it said by "strict accountability" the Lusitania would not
have been sunk. He also announced that he favored a constitutional
amendment providing for women's suffrage. Later he made extended
stumping tours in which he reiterated his attacks on the
administration, but he disappointed his friends by failing to reveal a
constructive program. Roosevelt, meanwhile, assisted the Republican
candidate by a series of speeches, one of the earliest of which was
that of August 31, in Maine. That state held its local elections on
September 11 and it was deemed essential by both parties to make every
effort to carry it so as to have a good effect on party prospects
elsewhere. Roosevelt's speech typified his criticisms of the
administration. He declared that Wilson had ostensibly kept peace with
Mexico but had really waged war there; he asserted that the President
had shown a lack of firmness in dealing with Mexico and had kissed the
hand that slapped him in the face although it was red with the blood
of American women and children; he compared American neutrality in the
European War with the neutrality of Pontius Pilate and believed that
if the administration had been firm in its dealings with Germany there
would have been no invasion of Belgium, no sinking of vessels and no
massacres of women and children.

Wilson followed the example of McKinley in 1896 and conducted his
campaign chiefly through speeches delivered from the porch of "Shadow
Lawn," his summer residence in New Jersey. In this way he emphasized
the legislative record of the Democrats, defended his foreign policy
and attacked the Republicans as a party, although not referring to
individuals. An important part of his strategy was an attempt to
attract the Progressives to his support. He met his opponent's
vigorous complaints in regard to his attitude toward Mexico and the
European War by pressing the question as to the direction in which the
Republicans would change it. As Hughes was apparently unwilling to
urge immediate war on Germany, he could only retort that a firm
attitude in the beginning would have prevented trouble, and there the
matter rested throughout the campaign. Supporters of Wilson also
defended his foreign policy, summing up their contentions in the
phrase, "He kept us out of war."

Foreign policy as a political issue was pressed temporarily into the
background by the sudden demand of the railroad brotherhoods for
shorter hours and mote pay, threatening a nation-wide strike if their
plea was unheeded. Neither party wished to risk the labor vote by
opposing the unions, and the public did not desire a strike, much as
it deprecated the attitude of the labor leaders in threatening trouble
at this juncture. The President took the lead in pressing a program of
railroad legislation, part of which was a law granting the men what
they desired. This was immediately passed, although the remaining
recommendations were laid aside. In the House the Republicans joined
with the Democrats in putting the law through, although nearly thirty
per cent. of the members refrained from voting at all, but in the
Senate party lines were more strictly drawn. In many quarters the
President was vigorously condemned on the ground that he had
"surrendered" to a threat. Hughes joined in the dissent, but somewhat
dulled its effect by giving no evidence of opposition until the law
was passed and by stating that he would not attempt to repeal it if
elected. During the closing days of the campaign Hughes issued a
statement declaring that he looked upon the presidency as an executive
office and stated that if chosen he would consider himself the
administrative and executive head only, and not a political leader
commissioned with the responsibility of determining policies. At the
close of the campaign, also, the benefits of a protective tariff were
urged as a reason for electing Hughes.

[Illustration:
Election of 1916, by Counties]

The result of the balloting on November 7 was in doubt for several
days because the outcome hinged on the votes of California and
Minnesota, either of which would turn the scale. In the end Wilson was
found to have received 9,128,837 votes and Hughes, 8,536,380. The vote
in the electoral college was 277 to 254. The outcome was remarkable in
several respects. Each candidate received a larger popular vote than
had ever before been cast; Wilson won without New York or any of the
other large eastern states, finding his support in the South and the
Far West; each side was able to get satisfaction from the result, the
Republicans because their party schism was sufficiently healed to
enable them to divide the House of Representatives evenly with their
opponents, and the Democrats because their candidate was successful in
states which elected Republican senators and governors by large
majorities.


BIBLIOGRAPHICAL NOTE

In the nature of the case, any bibliography which concerns the events
of so recent and important a period is of temporary value only. Ogg
presents an excellent one, but many important volumes have been
printed since 1917, his date of publication.

A reliable account of the chief events is contained in the _American
Year Book_. The numerous biographies of President Wilson are written
under the difficult conditions that surround the discussion of recent
events. Available ones are: E.C. Brooks, _Woodrow Wilson as President_
(1916), eulogistic, but contains extracts from speeches; W.B. Hale,
_Woodrow Wilson, The Story of His Life_ (1912); H.J. Ford, _Woodrow
Wilson_ (1916); A.M. Low, _Woodrow Wilson, an Interpretation_ (1918),
a friendly and substantial analysis by an English newspaper
correspondent; W.B. Dodd, _Woodrow Wilson and His Work_ (1920),
sympathetic, written in the spirit of the investigator, and the best
life up to the time of its publication. Better than any biography is a
careful study of Wilson's addresses and speeches, editions of which
have been prepared by A.B. Hart, J.B. Scott, A. Shaw and others.

Periodical literature concerning the legislative program of the first
Wilson administration is especially abundant. On the tariff, in
addition to Taussig, consult: _Quarterly Journal of Economics_ (1913),
"The Tariff Act of 1913"; _Journal of Political Economy_ (1914), "The
Tariff of 1913." On the federal reserve system, _Political Science
Quarterly_ (1914), "Federal Reserve System"; _Quarterly Journal of
Economics_ (1914), "Federal Reserve Act of 1913"; _American Economic
Review_ (1914), "Federal Reserve Act"; _Journal of Political Economy_
(1914), "Banking and Currency Act of 1913"; H.P. Willis, _The Federal
Reserve_ (1915); E.W. Kemmerer, _The A B C of the Federal Reserve
System_ (1918). On the anti-trust acts, _Political Science Quarterly_
(1915), "New Anti-Trust Acts"; _Quarterly Journal of Economics_
(1914), "Trust Legislation of 1914"; _American Economic Review_
(1914), "Trade Commission Act." For the early stages of the European
conflict see the references under Chapter XXV.

The best accounts of the election of 1916 are in the _American Year
Book_, and in Ogg. Other readable accounts are: _Nineteenth Century_
(Dec., 1916), "The Re-Election of President Wilson"; W.E. Dodd,
_Woodrow Wilson_ (1920).

       *       *       *       *       *

[1] The cabinet, 1913-1920, was as follows: Secretary of State, W.J.
Bryan (to 1915), R. Lansing (to 1920), B. Colby; Secretary of the
Treasury, W.G. McAdoo, C. Glass, D.F. Houston; Secretary of War, L.M.
Garrison, N.D. Baker; Attorney-General, J.C. McReynolds, T.W. Gregory,
A.M. Palmer; Postmaster-General, A.S. Burleson; Secretary of the Navy,
J. Daniels; Secretary of the Interior, F.K. Lane, J.B. Payne;
Secretary of Commerce, W.C. Redfield, J.W. Alexander; Secretary of
Labor, W.B. Wilson.

[2] On Apr. 23, 1920, the amount of federal reserve notes outstanding
was $3,068,307,000.

[3] On Apr. 23, 1920, the reserves deposited by member banks reached a
total of $2,083,568,000.

[4] The Commission superseded the Bureau of Corporations.

[5] The appointment of Louis D. Brandeis to the Supreme Court brought
to that body a well-known proponent of the newer types of social and
economic theory. At first the opposition to confirming his nomination
in the Senate, based upon certain facts in his career and allegations
concerning them, was uncommonly pronounced. Dissent diminished,
however, in the face of investigation, and the nomination was
confirmed by a large majority on June 1, 1916.

[6] Bryan remained in sympathy with the administration in other
respects, and aided in the campaign of 1916.

[7] Despite Roosevelt's refusal to run, the Progressive
Vice-Presidential candidate continued the campaign. The Socialist
Labor party, the Socialist party and the Prohibitionists also
presented candidates.

[8] The Republican campaign fund was $2,445,421 contributed by 34,205
persons; the Democratic fund, $1,808,348 given by 170,000 persons.




CHAPTER XXV


THE UNITED STATES AND THE WORLD WAR

The reelection of Wilson in November, 1916, could hardly be interpreted
in any other light than as an approval of his patient foreign policy.
Nevertheless, for the ensuing five months the problem of our
international relations, and especially the question whether we ought
to enter the World War, continued to divide the American people into
hostile camps. The opponents of the President, led by Roosevelt,
contended that Wilson was lacking in "patriotism, courage and
foresight"; that the failure of the administration to protest against
Germany's march across Belgium was due to timidity and a "mean
commercial opportunism" which caused the President to act in the spirit
of refusing to perform a duty unless there was a pecuniary profit to be
gained thereby; and that the interchanges of diplomatic notes with the
German government were "benevolent phrase-mongering" which did not
accomplish anything. When Germany used the submarine to sink vessels
despite the President's "strict accountability" note and when the
administration did not then take forceful action against the offender,
his opponents declared that the President meant "precisely and exactly
nothing" by his words. Late in 1915 Wilson became convinced of the
necessity of an increase in our means of defense, and in order to
arouse Congress to action he went out into the Middle West where he
addressed large audiences on "preparedness." After long discussion
Congress passed the National Defense Act by the provisions of which the
military strength of the country was to be expanded to 645,000 officers
and men during a period of five years. The President's conversion to
preparedness was interpreted as a tardy recognition of an obvious duty,
and his plan deprecated as no more than a "shadow program." And later,
as his attitude became more warlike, the opposition declared that he
had at last acted because of "pressure" and "criticism," rather than
because of a definite and positive purpose of his own. In brief, then,
a considerable portion of the country insisted upon America's early
entrance into the European conflict, and judged Wilson to be a timid
politician who lacked a courageous foreign policy and who was being
driven toward war by the force of public opinion.

On the other hand, the traditional American disinclination to become
entangled in foreign complications was the decisive force with the
majority. In an address which the President delivered in New York he
said that he received a great many letters from unknown and
uninfluential people whose one prayer was, "Mr. President, do not allow
anybody to persuade you that the people of this country want war with
anybody." There were, moreover, Americans who still retained the
traditional dislike of England and who hesitated to support an alliance
with that nation; others did not relish association with Russia, which
had long been looked upon as the arch-representative of autocracy; and
others were indifferent or confused or inclined to the German side.

The attitude of the President, meanwhile, constantly found expression
in addresses to Congress and the people, which were so widely read and
discussed and which had so great an influence in forming public opinion
that the more prominent of them must be mentioned. Beginning with the
proclamation of neutrality on August 18, 1914, and a speech at
Indianapolis on January 8, 1915, he asserted the belief that the United
States should remain neutral, not only because it was the traditional
policy to stand aloof from European controversies but also because "it
was necessary, if a universal catastrophe was to be avoided, that a
limit should be set to the sweep of destructive war ... if only to
prevent collective economic ruin and the breakdown throughout the world
of the industries by which its populations are fed and sustained." He
also hoped that the time might quickly come when both sides would
welcome mediation by a great people that had preserved itself neutral,
self-possessed and sympathetic with the burdens of the warring powers.
Before the close of 1915 he gave up his earlier opposition to military
preparation, as has been seen, and while the project for a larger
defensive force was being discussed, he made a significant address on
May 27, 1916, to the League to Enforce Peace. With the causes and
objects of the war, he declared, America was not concerned; the
"obscure fountains" of its origins we were not interested to explore;
in its spread, however, it had so "profoundly affected" America that we
were no longer "disconnected lookers-on," but deeply concerned. "We are
participants," he asserted, "whether we would or not, in the life of
the world. The interests of all nations are our own also. We are
partners with the rest." Oddly enough the statement that the origins of
the war and the purposes for which it was started did not concern us
was widely circulated, and misinterpreted as indicating a lack of
sympathy with the ideals for which the Allies were fighting at the time
speech, while the remainder of the address, which was far more
significant, was largely overlooked. Nevertheless the declaration that
the war had become our concern was an important part of Wilson's series
of utterances on the issues of the day, and demands emphasis at this
point because the President was representative, in holding this
opinion, of a great body of his countrymen. The conviction that the
European war had become our affair was deepened in the minds of many
Americans when news arrived late in 1916, that the Teutonic military
authorities were seizing and deporting Belgian workmen and compelling
them to labor in German fields and factories.

In December, President Wilson again claimed the attention of the world
by his reply to a proposal by Germany that peace negotiations be entered
upon. He declared--and his note was sent to all belligerents--that the
leaders of the two sides had stated their objects in general terms only:

But, stated in general terms, they seem the same on both sides. Never
yet have the authoritative spokesmen of either side avowed the precise
objects which would, if attained, satisfy them and their people that
the war had been fought out.

The support of America in the war had long since become the great stake
for which both sides in the conflict were playing, and the crisis of
the game was at hand. On January 22, 1917, Wilson addressed the Senate
and stated the results of his action. The reply of the Germans, he
declared, had merely stated their readiness to meet their antagonists
in conference to discuss terms of peace; the Allies had detailed more
definitely the arrangements, guarantees and acts of reparation which
would constitute a satisfactory settlement. He proceeded then to add
that the, United States was deeply concerned in the terms of peace
which would be made at the close of the conflict, and to enumerate some
of those for which Americans would be most insistent: equality of
rights among nations; the recognition of the principle that territories
should not be handed about from nation to nation without the consent of
the inhabitants of the territories; an outlet to the sea for every
nation where practicable; the freedom of the seas; and the limitation
of armaments. The interchange of notes had made two things clear; that
the concern of the United States in the war was intimate, and that
the people of this country would know definitely the purposes of the
conflict before they decided to enter it.

On January 31, Germany announced an extension of her submarine warfare.
A wide area surrounding the British Isles, France, and Italy, and
including the greater part of the eastern Mediterranean Sea was
declared to be a barred zone. All sea traffic, neutral as well as
belligerent, the note warned, would be sunk, except that one American
ship would be allowed to pass through the zone each week provided that
it followed a designated, narrow lane to the port of Falmouth, England,
that it was marked with broad red and white stripes, and carried no
contraband. The President promptly broke off relations with Germany,
sent the German ambassador home and appeared before Congress to state
to that body and to the people the reasons for his decision. He
recounted the substance of his earlier correspondence with Germany in
regard to submarine warfare and recalled the promise of the German
government that merchant vessels would not be sunk without warning and
without saving human lives. He declared that the American government
had no alternative but to sever relations, although refusing to believe
that Germany would ruthlessly use the methods which she threatened,
until convinced of her determination by "overt acts." Information of
the move made by the United States was sent to American diplomatic
representatives in neutral countries with the suggestion that they take
similar action. Shortly afterward the President requested Congress to
pass legislation enabling him to supply armament and ammunition to
merchant vessels, and an overwhelming majority of both houses was ready
to accede to the request. A small minority in the Senate, however, was
able, under existing rules, to prevent Congressional action, although
the President found authority in existing statutes and was able to
proceed.[1]

Every important event in March, 1917, tended toward war between the
United States and Germany. On the first day of the month the State
Department made public a note from the German Secretary of State to the
German minister in Mexico which suggested a German-Mexican alliance in
case of the entry of the United States into the war. Germany was to
contribute financial support to Mexico and the latter was to recover
Arizona, New Mexico and Texas, which had been lost to the United States
many years before. Knowledge of this intrigue gave a distinct impetus
to the war spirit in all parts of the country. On March 5, President
Wilson was inaugurated for the second time and took occasion to state
again the attitude of the United States toward the war. Although
disclaiming any desire for conquest or advantage, and reaffirming the
desire of the United States for peace, he expressed the belief that we
might be drawn on, by circumstances, to a more active assertion of our
rights and a more immediate association with the great struggle. Once
more he stated the things for which the United States would stand
whether in war or in peace: the interest of all nations in world peace;
equality of rights among nations; the principle that governments derive
their just powers from the consent of the governed; the freedom of the
seas; and the limitation of armaments. Later in the month information
reached America that there had been a revolution in Russia, that the
Czar had been compelled to abdicate and that a republican government
had been established. The news was gladly heard in the United States as
it seemed to presage the overthrow of autocracy everywhere. On March
22, the new Russian government was formally recognized by the United
States and later a loan of $100,000,000 was made.

In the meanwhile the "overt acts" which the President and the American
people hoped might not be committed became sufficiently numerous to
prove that Germany had indeed entered upon the most ruthless use of the
submarine. Seven American vessels were torpedoed, with the loss of
thirteen lives, and many more vessels of belligerent and neutral
nations were sunk, in most cases without warning. The President
accordingly summoned Congress to meet in special session on April 2.
When that body assembled he again and for the last time explained the
character of German submarine warfare, charging that vessels of all
kinds and all nations, hospital ships as well as merchant vessels were
being sunk "with reckless lack of compassion or of principle."
International law, he complained, was being swept away; the lives of
non-combatant men, women and children destroyed; America filled with
hostile spies and attempts made to stir up enemies against us; armed
neutrality had broken down in the face of the submarine, and he
therefore urged Congress to accept the state of war which the action of
Germany had thrust upon the United States. Such action, he believed,
should involve the utmost cooperation with the enemies of
Germany--liberal loans to them, an abundant supply of war material of
all kinds, the better equipment of the navy and an army of at least
500,000 men chosen on the principle of universal liability to service.
An important part of the President's address was that in which he
distinguished between the German people and the German government. With
the former, he asserted, we had no quarrel, for it was not upon their
impulse that their government acted in entering the war. But the
latter, the Prussian autocracy, "was not and never could be our
friend." Once more he disclaimed any desire for conquest or dominion:

    We are glad ... to fight thus for the ultimate peace of the world and
    for the liberation of its peoples, the German peoples included: for
    the rights of nations great and small and the privilege of men
    everywhere to choose their way of life and of obedience. The world
    must be made safe for democracy. Its peace must be planted upon the
    tested foundations of political liberty.

The response of Congress was prompt and nearly unanimous. In the House
by a vote of 373 to fifty, and in the Senate by eighty-two to six, a
resolution accepting the status of war was quickly passed and proclaimed
by the President on April 6.[2] His position was a strong one. His
patience and self-control, to be sure, had been carried to the extreme
where they seemed like cowardice and lack of policy to the more
belligerent East; but they had convinced the more pacific West that he
could not be hurried into war without adequate reasons. All sections and
all parties were united as the country had never been united before. His
insistence that the United States had no ulterior motives in entering
the war and his constant emphasis on ideals and the moral issues of the
conflict placed the struggle on a lofty plane, besides giving him and
his country at that time a position of leadership in the world such as
no man or nation had ever hitherto enjoyed. Moreover the evolution
through which the President went, from adherence to the traditional
aloofness from European affairs to throwing himself enthusiastically
into the conflict, was an evolution through which most of his countrymen
were passing. Every public address which the President delivered, every
message to Congress, every request to the legislative branch of the
government was read widely, disagreed to or received with enthusiasm in
one quarter or another and discussed everywhere with interest and
energy. The result was the education of America in a new foreign policy.
It was no slight matter to discard the traditions of a century and a
quarter, and the brevity and inconsiderable size of the controversy was
the marvel, rather than its length and bitterness.[3]

America had need of her unity and her enthusiasm. The size of the
conflict, the number of men that must be raised and trained, the
quantity of materials required, the amount of money needed, and, above
all, the mental readjustment necessary in a nation that had hitherto
buried itself in the pursuits of peace--all these considerations
emphasized the importance of the task that the United States was
undertaking. Into Washington there poured a bewildering stream of offers
of assistance; organizations had to be built up over night to take hold
of problems that were new to this country; men found themselves hurried
into tasks for which they must prepare as best they might, and under
crowded working conditions, changing circumstances and confusion of
effort that beggar description. In many cases, America could learn
valuable lessons from European experience, and to that end commissions
of eminent statesmen and soldiers were sent to this country to give us
the benefit of their successes and failures.

An important step had already been taken in the creation of the Council
of National Defense on August 29, 1916, an act which indicated a
realization that the United States might at any time be drawn into the
European struggle. The body was composed of six members of the Cabinet,
with the Secretary of War as chairman, and was assisted by an Advisory
Commission composed of seven experts in the various industries that
would be most essential to the prosecution of the war. The Council
furnished the means of coordinating the industries of the country and
getting them into touch with the executive departments of the
government. State councils of defense were likewise organized to arouse
the people to the performance of their share in the nation's work, to
circulate information and to assist the several agencies of the federal
government. A National Research Council mobilized the scientific talent
of the country and brought it to bear on certain of the problems of
warfare. A Naval Consulting Board examined inventions offered to the
Navy Department. The Committee on Public Information furnished condensed
war news to town and country papers, circulated millions of pamphlets
explaining the causes of the war and upholding America's purposes in it,
and directing speakers who aided in campaigns for raising money and
educating the people in their duty during the crisis. The War Industries
Board developed plans for the production of the multifarious supplies
needed. The United States Shipping Board took hold of the problem of
building sufficient ships to transport troops and cargoes, and to
replace vessels sunk by submarines. By means of a Committee on Labor the
laboring men gave their support to the conduct of the war and agreed to
delay controversies until the war was over.

The exhausted condition of the supplies of food among the Allies, and
the size of the armies which America decided to raise, made the Food
Administration one of importance. At the time when the United States
entered the war there was a dangerous shortage of food in Europe due to
the decrease in production and to the lack of the vessels necessary to
bring supplies from distant parts of the world. The problem centered
mainly in wheat, meat, fats and sugar. The demand upon the United States
was not only large but increasing. Accordingly, legislation was passed
on August 10, 1917, which made it unlawful to destroy or hoard food; it
provided for the stimulation of agriculture; and it authorized the
President to purchase and sell foods and fix the price of wheat. Wilson
appointed as the chief of the Food Administration Herbert C. Hoover,
whose experience with the problem of Belgian relief enabled him to act
promptly and effectively. Hoover's one great purpose was to utilize all
food supplies in such a way as would most help to win the war. He
cooperated with the Department of Agriculture which had already started
a campaign for stimulating the cultivation of farms and gardens on all
available land. Food administrators were appointed in the states and
local districts. Speakers, posters, libraries and other agencies were
utilized to urge the people to eat less wheat, meats, fats and sugar in
order that more might be exported to the Allies. Millions of housewives
hung cards in their windows to indicate that they were cooperating with
the United States Food Administration. "Wheatless" and "meatless" days
were set apart. These voluntary efforts were supplemented by government
regulation, and dealers in food products were compelled to take out
federal licenses which enabled the Administration to control their
operations and to prevent prices from going to panic levels. The Food
Administration established a Grain Corporation which bought and sold
wheat; it placed an agency in Chicago to buy meat for ourselves and the
Allies; it called a conference of the sugar refiners, who agreed to put
in its hands the entire supply of that commodity. In a word, by
stimulating voluntary efforts and by means of government regulations,
the Food Administration increased production, decreased consumption, and
coordinated the purchase of food for the army, the navy, the Allies, the
Red Cross and Belgian relief. The Food Administration was hardly
established before it became necessary to organize a Fuel Administration
to teach economy in the use of coal, to stimulate production, adjust
disputes between employers and employees, fix prices and control the
apportioning of the supply among the several parts of the country.

The vital relation of the transportation system of the country to the
winning of the war was apparent at the start. As soon as war was
declared, therefore, nearly 700 representatives of the railroads formed
a Railroads' War Board to minimize the individual and competitive
activities of the roads, coordinate their operation, and produce a
maximum of transportation efficiency. The attempt of the railroad
executives, however, quickly broke down. In the first place, as has been
seen, our entire body of railroad legislation is based upon the idea of
separating the several systems and compelling them to compete rather
than cooperate. The habits and customs thus formed could hardly be done
away with in an instant. In the second place the cost of labor and
materials was constantly mounting, and the demand for more equipment was
insistent. The railroads could meet these greater costs only by raising
rates, a process which involved obtaining the assent of the Interstate
Commerce Commission and required a considerable period for its
accomplishment. The roads were also embarrassed by an unprecedented
congestion of traffic on the eastern seaboard, from which men and
cargoes must be shipped to Europe. Accordingly, on December 26, 1917,
the President took possession of the railroad system for the government
and appointed the Secretary of the Treasury, William G. McAdoo, as
Director General. As rapidly as possible the railroads were merged into
one great system. The entire country was divided into districts at the
head of which were placed experienced railroad executives. Terminals,
tunnels and equipment were used regardless of ownership in the effort to
get the greatest possible service out of existing facilities. The
passenger service was greatly reduced in order to free locomotives and
crews for freight trains, duplication of effort was done away with where
possible, officials who were not necessary under the new plan were
dropped, and equipment was standardized. Existing legislation allowed
the government to change freight and passenger rates, and on May 25,
1918, these were considerably raised. The winter of 1917-1918 was
memorable for its severity, and placed great difficulties in the way of
the railroads; nevertheless, between January 1, 1918, and November 11 of
the same year nearly six and a half million actual and prospective
soldiers were carried for greater or smaller distances.

An important part of American preparation for war was the attention paid
to the "morale" organizations, which were designed to maintain the
courage and spirit of the fighting man. As far as legislation could do
it, the most flagrant vices were kept away from the camps. Moreover the
Commissions on Training Camp Activities attempted to supply wholesome
entertainment and associations. Under their direction, various
organizations established and operated theatres, libraries and
writing-rooms, encouraged athletics in the camps, and offered similar
facilities for soldiers and sailors when on leave in towns and cities
near by. The Red Cross conducted extensive relief work both in this
country and abroad; surgical dressings were made, clothing and comfort
kits supplied, and money contributed. In France, Belgium, Russia,
Roumania, Italy and Serbia the Red Cross conducted a fight against the
suffering incident to war.

The legislation which established the system of allotments, allowances
and War Risk Insurance was also designed in part to maintain the
_morale_ of the army and navy. The pay of the "enlisted man" or private
was $30.00 per month. In the case of men with dependents, an "allotment"
of $15.00 was to be sent home and the government thereupon contributed
an "allowance" which normally amounted to $15.00 or more, and was graded
according to the number of the man's dependents and the closeness of
their relationship to him. Provision was made also for compensation for
officers and men injured or disabled in the line of duty, and for
training injured men in a vocation. In addition, the War Risk Insurance
plan provided means by which both officers and men could at low cost
take out government insurance against death or total disability. In this
way, it was hoped, some of the distresses of war would be alleviated so
far as possible and a repetition of the pension abuses of the Civil War
somewhat guarded against.

The total direct money cost of the war from April, 1917, to April, 1919,
was estimated by the War Department at $21,850,000,000, an average of
over a million dollars an hour, and an amount sufficient to have carried
on the Revolutionary War a thousand years. In addition, loans were
extended to the Allies at the rate of nearly half a million dollars an
hour. This huge amount was raised in part through increased taxes.
Income taxes were heavily increased; levies were made on such profits of
corporations as were in excess of profits made before the war, during
the three years 1911-1913; additional taxes were laid upon spirits
and tobacco, on amusements and luxuries; and the postage rates were
raised. In part, also, the cost of the war was defrayed through loans. A
portion of the amount borrowed was by the sale of War Savings This
expedient was designed doubtless not merely to encourage persons of
small means to aid in winning the war--a beginning could be made with
twenty-five cents--but also to encourage thrift among all classes. Most
of the borrowed money, however, was raised through the five "Liberty
Loans," a series of popular subscriptions to the needs of the
government. In each case the government called upon the people to
purchase bonds, ranging from two billions at first to six billions at
the time of the fourth loan. There were four and a half million
subscribers for the first loan, but after a little experience the number
was readily increased until 21,000,000 people responded to the fourth
call. Popular campaigns such as never had been seen in America,
campaigns of publicity, house-to-house canvassing and appeals to the
win-the-war spirit resulted in unprecedented financial support. Isolated
communities in the back country and people of slender means in the
cities, no less than the great banks and wealthy corporations cooperated
to make the Liberty loans of social and economic as well as financial
importance.

Evidence seems to be sufficient to indicate that the resources of the
United States were thrown into the conflict none too soon. When it was
determined to place armed guards on merchant ships, Rear Admiral W.S.
Sims was sent to Great Britain to keep the Navy Department informed on
problems connected with the possible entry of the United States into the
conflict. After the American declaration of war the Admiral was placed
in charge of the naval forces of the United States abroad and thereafter
worked in close cooperation with our European associates. The German
submarine policy had been put fully into effect; no solution of the
submarine menace had been reached; and English officials were fearful
that England could not last longer than November 1. In taking this view
the British were probably in harmony with the Germans who expected to
crush England before the weight of the United States could be felt.
Although insufficient for so great a conflict, the American navy was
thoroughly prepared for active service, and six destroyers were sent to
European waters for a prolonged stay, within eighteen days of the
declaration of war. This early force was quickly followed by others
until, at the close of the war, 5,000 officers and 70,000 enlisted men
were serving abroad. A three-year naval construction program which had
been adopted in 1916 was pushed forward and somewhat expanded; new craft
were commandeered wherever they could be found; private citizens loaned
vessels or leased them at nominal sums; and German ships interned in
American ports were taken over. Existing stations for the training of
seamen were enlarged and new ones established, and schools were set up
in colleges and at other points for radio operators, engineers and naval
aviators. By such means the number of vessels in commission was
increased from 197 to 2,003 and the personnel from 65,777 to 497,030.

The most dreaded enemy of the navy, the submarine, was successfully met
by two devices. When transports and merchant-vessels were being sent
across the ocean, they were gathered into groups or convoys and were
protected by war vessels, especially torpedo-boat destroyers. The depth
charge was also used with telling effect. This consisted of a heavy
charge of explosive which was placed in a container and dropped into the
sea where the presence of a submarine was expected. The charge was
exploded at a pre-determined depth by a simple device, and any
under-seas craft within 100 feet was likely to be destroyed or to have
leaks started that would compel it to come to the surface and surrender.

Aside from combatting the submarine, the greatest activity of the navy
was the transportation of men and supplies to France. First and last
more than 2,000,000 troops were carried to Europe, and although Great
Britain transported more than half the men, yet 924,578 made the passage
through the danger zones under the escort of United States cruisers and
destroyers. The cargo fleet was substantially all American. The
transportation of supplies alone required the services of 5,000 officers
and 29,000 enlisted men, and involved the accumulation of a vast fleet,
the acquisition of docks, lighters, tugs, and coaling equipment, as well
as the establishment of an administrative organization, at the precise
time when the shipping facilities of the world were being strained to
the breaking point by submarines.

On the other side of the ocean naval bases were established in England,
Ireland, Scotland, France and Italy; a considerable force operated from
Gibraltar and others from Corfu, along the Bay of Biscay, in the North
Sea and at Murmansk and Archangel. Besides cooperating with the navy of
the Allies in keeping the Germans off the seas, the American navy laid
about four-fifths of the great mine barrage which extended from the
Orkney Islands to Norway, a distance of 230 miles. This astonishing
enterprise--America alone laid 56,000 mines--together with a similar
chain laid across the Strait of Dover was intended to pen the submarine
within the North Sea.

In the main the raising of an army for European service rested upon the
act of May 18, 1917. It provided for the Increase of the regular army
from approximately 200,000 to 488,000; for the expansion of the strength
of the National Guard; and for the selection of a National Army by draft
from men between the ages of twenty-one and thirty years inclusive. The
determination to raise a draft army was based upon the belief that in
this way successive and adequate supplies of men could be found without
disproportionate calls on any section of the country and without undue
disturbance of the industrial life of the nation. Although the plan ran
counter to American practice during most of our history, the draft army
became deservedly popular as a democratic and efficient method of
finding men. Officers were supplied mainly through training camps, of
which the best known was that at Plattsburg, New York. A novelty in the
new army was a plan for the appointment and promotion of officers on a
scientific rating system which took account of ability and experience,
thereby doing away with some of the favoritism formerly connected with
our military system. At a later time an organization was perfected by
which enlisted men were grouped according to their ability and
occupations, so that each division of the army might have assigned to it
the number of mechanics, carpenters, clerks and the like that it might
require. For the housing and training of the enlarged National Guard,
sixteen tent-camps were established in the South; and for the National
Army, sixteen cantonments, built of wood and capable of housing 40,000
men each. A cantonment comprised 1,000 to 1,200 buildings, and was
virtually a city with highways, sewers, water supply, laundries and
hospitals.[4] The problem of obtaining supplies was as great as that of
housing and training the army. An entire city was erected in West
Virginia for the making of part of the smokeless powder required; the
British Enfield rifle was modified to use American ammunition so that
machinery already making arms for England could be utilized with a
minimum of change; and European experience having indicated the value of
the machine gun, a new and improved type was invented by John M.
Browning. In many cases, however, it was impossible immediately to equip
both the soldiers in training here, and those who could be sent abroad.
Hence surplus equipment of certain kinds was supplied by France and
England. Furthermore, actual combat had emphasized the vital importance
of aviation and had developed warfare with poisonous gases and with
tanks, so that it became necessary to establish new branches of the
service to meet these needs.

Shortly after the declaration of war, General John J. Pershing, who had
already experienced active operations in the Philippines and on the
Mexican border, was sent to France to act as Chief of the American
Expeditionary Force--the A.E.F. as it was commonly called. General
Pershing was followed by a division of regulars in June, 1917, and by
the "Rainbow" division of the National Guard, a body composed of
guardsmen from various states so as to distribute widely the honor of
early participation in the war. In France the American troops were
detailed either for the Service of Supply or for combat. The former,
with headquarters at Tours, developed port facilities, constructed ship
berths, built railroads and warehouses, and took care of the
multifarious duties that have to be performed behind the lines.
Divisions destined for combat were usually given one or two months of
training in France before going to the front, and were then kept for
another month in a quiet sector before engaging in more active service.

[Illustration:
The Western Front]

Between April, 1917, when America declared war, and approximately a year
later when her weight began to be felt, the Allies suffered reverses
that were thoroughly disheartening and were almost disastrous. Russia,
who had conducted a powerful offensive in 1916, began to retreat in the
summer of 1917 and was thereafter no longer a military factor.[5] Italy
had driven back the Austrians in the summer of 1916, but in the fall of
1917 was compelled to conduct a retreat that became all but a disaster.
Allied conferences were accordingly held in Paris in November and
December, 1917, for the purpose of bringing about closer unity in the
prosecution of the war. Nation after nation, on the other hand, had
severed relations or declared war on the Teutonic powers until a great
part of the world had ranged itself on the side of the Allies. In March,
1918, the Germans precipitated a series of crises--the final ones as it
turned out. In that month they began a terrific drive on a fifty-mile
front against their opponents in the western theatre of the war. In
order to meet this thrust the Allies decided to give over the supreme
command of all their forces to Marshal Ferdinand Foch, chief in command
of the French army, and General Pershing thereupon offered him all the
American troops in France. American efforts were redoubled, in the face
of the new danger, and forces were transported across the ocean in
numbers which had not been anticipated and which soon began to give the
Allies a substantial advantage. One vessel, the _Leviathan_, landed in
France the equivalent of a German division each month. The enemy,
nevertheless, continued to advance and on May 31 were at
Chateau-Thierry, only forty miles from Paris, where the American Third
Division assisted in preventing any further forward movement. The
leading military experts in the United States, meanwhile, with the
support of a large portion of the public were demanding a still larger
army and the Secretary of War, Newton D. Baker, accordingly laid before
Congress a plan which developed eventually into the "Man Power" act of
August 31, 1918. It changed the draft ages and added more than
13,000,000 registrants to the available supply of men. A clause of this
law, designed in part to provide further supplies of officers, allowed
the Secretary of War to send soldiers to educational institutions at the
public expense, thus establishing the Students' Army Training Corps.[6]

[Illustration:
Strength of the American Expeditionary Force
July 1, 1917-Nov. 1, 1918]

At the time when General Pershing placed his forces at the disposal of
Marshal Foch, the Americans numbered 343,000 and were used mainly to
relieve the French and British at quiet parts or "sectors" on the
western front. In April, 1918, however, the First Division was placed in
a more active position, and on May 28 took Cantigny; the Second Division
was on the Marne River early in June, and later in the month helped
prevent a German advance at Belleau Wood. Other forces were sent to
operate with the British, a regiment was sent to Italy, and a small
force to northern Russia and Siberia. In mid-July the Germans renewed
their attacks but were shortly turned back again at Chateau-Thierry, and
Marshal Foch judged this to be the time for the Allies to make a general
offensive movement. On the 18th the First and Second Divisions, with
picked French troops, made a successful drive toward Soissons. On August
30 the Americans were given a permanent portion of the front, and two
weeks later came the first distinctly American action in the reduction
of the St. Mihiel salient--a wedge driven by the Germans into the allied
line. Infantry, artillery, aircraft, tanks and ambulances were
gathered--about 600,000 men all told--mostly under cover of darkness.
Preceding the drive a heavy artillery fire was directed upon the enemy
for four hours, during which brief period thirty times as many rounds of
ammunition were fired as were used by the Union forces at Gettysburg in
three days. Then at five o'clock in the morning, on September 12, the
troops fell upon an enemy which had been demoralized by the artillery,
and routed them. The American losses were 7,000--injuries for the most
part--and the gains, 16,000 prisoners, 443 guns and a great quantity of
war materials, together with an advantageous position for further
advance. The "American Army was an accomplished fact."

The most important action in which the Americans participated was the
Meuse-Argonne offensive. The goal of this attack was the
Carignan-Sedan-Mézières railroad, which ran parallel to the front and
comprised the main supply line of the enemy. The drive began late in
September and continued with greater or less intensity and with
increasing success until November 11, when it became evident that the
Germans were in serious difficulties. Their line was cut, and only
surrender or an armistice could prevent thorough-going disaster.[7]

While the allied armies were first stemming the German advance and later
making their counter-offensive, the statesmen were attempting to
preserve the morale of the Allies and break down that of the enemy by
means of a wide-spread peace offensive. Because of his position as
President of the United States and his skill in the expression of the
purposes of the Allies, Wilson became by common consent the spokesman of
the enemies of Germany, much as he had earlier been the representative
of the neutral nations. In August, 1917, the Pope proposed peace on the
basis of "reciprocal condonation" for past offenses, and the reciprocal
return of territories and colonies. In reply Wilson contended that the
suggested settlement would not result in a lasting peace. Peace, he
believed, must be between peoples, and not between peoples on the one
hand and "an ambitious and intriguing government" on the other. "We
cannot," he declared, "take the word of the present rulers of Germany as
a guarantee of anything that is to endure unless explicitly supported by
such conclusive evidence of the will and purpose of the German people
themselves as the other peoples of the world would be justified in
accepting." The reply continued, of course, the attempt made in the
address to Congress calling for a declaration of war--the attempt to
drive a wedge between the German people and their rulers, but for the
moment the attempt was fruitless.

On January 8, 1918, President Wilson again explained the attitude of the
United States, in an address to Congress in which he gave expression to
the famous "fourteen points." "The program of the world's peace," he
stated, must include: the beginning of an era of "open diplomacy" and
the end of secret international understandings; the freedom of the seas
in peace and war; the removal of economic barriers between nations; the
reduction of armaments; the impartial adjustment of colonial claims; the
evacuation of territories occupied by Germany, such as Russia, Belgium,
France and the Balkan states; the righting of the wrong done to
Alsace-Lorraine, the provinces wrested from France by Germany in 1871;
an opportunity for peoples subject to Austria and Turkey to develop
along lines chosen by themselves; the establishment of a Polish state
which should include territories inhabited by indisputably Polish
populations; and an association of nations to guarantee the safety of
large and small states alike. Both Austria and Germany replied to this
address, but not in a manner to make possible a cessation of warfare. In
setting these replies before Congress, as well as in later speeches both
to that body and to public audiences, the President reiterated the peace
program of the Allies.

In the meanwhile conditions in the Teutonic countries were reaching a
serious point. Germany, Austria, Bulgaria and Turkey were facing an
enraged world. Their man power was almost exhausted, the numbers of
killed and wounded in Germany alone being estimated at 6,000,000 men;
famine, agitation and mutiny were at the door and revolution on the
horizon; food was scarce and of poor quality; Austria was
disintegrating; signs were evident of dissensions in the German
government and suggestions were even made that the Kaiser abdicate.
Allied pressure in the field together with insistent emphasis on the
Allied distrust of the German government were at last having their
combined effect; the Teutonic morale was breaking down. On October 4 the
German chancellor requested President Wilson to take steps toward peace
on the basis of the "fourteen points." An interchange of notes ensued
which indicated that the Teutonic powers were humbled and that the
Chancellor was speaking in behalf of the people of Germany. The
Inter-allied Council then met at Versailles and drew up the terms of an
armistice which were delivered to Germany on November 7. That nation was
already in a tumult, in the midst of which demonstrations in favor of a
republic were prominent, and while the German government was considering
the terms of the armistice the Kaiser abdicated and fled to Holland, and
a new cabinet was formed with a Socialist at the head. The end was
evidently at hand and on November 11 the world was cheered with the news
that Germany had signed the armistice and the war was over.[8]

As far as the United States was concerned the questions of greatest
public interest after the close of the conflict, fell into two
categories: one connected with the complicated question of the exact
terms of settlement between the Allies and the Teutonic powers,
including modifications of the foreign policy of the United States; the
other, that concerning the readjustments necessary in the internal
affairs of the nation--economic, social and moral, as well as political.
Any adequate discussion of these matters requires so much more
information and perspective than can now be had, that only the barest
outlines can be given.

The conference for the determination of the settlements of the war was
to meet in Paris. The American representatives were to include Robert
Lansing, the Secretary of State, Henry White, who had represented the
United States in many diplomatic matters, especially as ambassador to
Italy and to France, Colonel Edward M. House, a trusted personal advisor
of the President, and General Tasker H. Bliss, the American military
representative on the Inter-allied Council. President Wilson himself was
to head the delegation.

In November, 1918, shortly before the departure of the President for
Paris, occurred the Congressional elections, which were destined to have
an important effect on the immediate future. Until late October the
usual display of partisan politics had been, on the surface at least,
uncommonly slight. On the 25th, however, the President urged the country
to elect a Democratic Congress, declaring that the Republican leaders in
Washington, although favorable to the war, had been hostile to the
administration, and that the election of a Republican majority would
enable them to obstruct a legislative program. The Republicans asserted
that the request was a challenge to the motives and fidelity of their
party, and a partisan and mendacious accusation. As a result of the
ensuing contest the control of both Senate and House were won by the
Republicans. It is impossible to judge whether the President's appeal
recoiled seriously against his own party or whether the tendency to
reaction against the administration at mid-term, which has been so
common since the Civil War, was the decisive force. In any case,
however, Wilson was compelled to go to Paris encumbered with the
handicap of political defeat at home.

Nevertheless he was received with unbounded enthusiasm by the French
people and at once became one of the central figures among the leaders
at Paris. Not only did the American delegates work in conjunction with
the representatives of the Allies, but Wilson became a member of an
inner council, the other participants in which were Premier Lloyd George
of England, Premier Georges Clemenceau of France and Premier Orlando of
Italy. The "Big Four," as the group was known, led the conference and
made its most important decisions. The day of the aloofness of the
United States from international affairs, which had been ended only
temporarily by the war with Spain, was apparently brought to a final
close.[9]

At length the treaty with Germany was completed, President Wilson
returned to America, and on July 10, 1919, he appeared before the Senate
to outline the purposes and contents of the agreement and to offer his
services to that body and to its Committee on Foreign Relations in order
to enable them intelligently to exercise their advisory function as part
of the treaty-making power. The Treaty was seen to contain two general
features: a stern reckoning with Germany which commended itself to all
except a small minority of the Senate; and a plan for a League of
Nations which provided for concerted action on the part of the nations
of the world to reduce armaments and to minimize the danger of war.
President Wilson's interest in the League was intense and of long
standing. He had hoped--and in this he was supported doubtless by the
entire American people--that the European conflict might be a "war to
end war," and to this conclusion he believed that a world association
was essential. Public interest in the project was indicated by the
efforts put forth in its behalf by Ex-President Taft, George W.
Wickersham, who had been Attorney-General in the Taft cabinet, President
Lowell of Harvard University, and other influential citizens.

[Illustration:
The Cost of Food
Jan. 1913-Jan. 1920]

Although interest in the Treaty and the League of Nations overshadowed
all other issues, nevertheless many problems relating to internal
reconstruction pressed forward for settlement. It was commonly, if not
universally felt that somehow the United States would be different after
the war, but in what ways and to what degree remained to be determined.
Reconstruction in the world of industry was complicated by the
demobilization of several millions of men from the army and navy, as
well as the freeing of a still larger number of both men and women from
various kinds of war work.[10] When the armistice was signed, the
industries of the country were under contract with the War Department to
provide supplies valued at six billion dollars, and these contracts had
to be terminated with as little dislocation of industrial life as might
be consistent with the necessity of stopping the production of materials
which the government could not use. The laboring classes had loyally
supported the war and had largely relinquished the use of the strike for
the time being. In the meantime the cost of living had doubled, while
wages in most industries had not responded equally. After the war,
therefore, it was inevitable that the laboring classes should become
restive under prevailing economic conditions. No more important question
faced the country, a keen observer declared, than that concerning the
wages of the laboring man: "How are the masses of men and women who
labor with their hands to be secured out of the products of their toil
what they will feel to be and will be in fact a fair return!"

The huge purchases of war materials in the United States by European
nations had transformed this country to a creditor nation to which the
chief countries of the world owed large interest payments. The situation
was a distinct contrast to the past, for the industrial development of
the country especially since the Civil War, had been made possible in
considerable measure by capital borrowed in European countries.
Hitherto, therefore, the United States had been a debtor nation sending
large yearly interest payments abroad. Moreover, America was being
increasingly looked to for raw materials as well as manufactured
articles, and was likely to become more than ever an exporting nation.

The mobilization of the large armies required for the war proved the
need of energetic reforms in fields that had earlier been too much
neglected. The fact that so many as twenty-nine per cent. of the young
men examined for the army between the ages of twenty-one and thirty had
to be rejected because of physical defects was a cause of astonishment.
The need of greater efforts in behalf of education was proved by the
large number of illiterates discovered, and the necessity of training
immigrants in the fundamentals of American government was so clearly
demonstrated as to give rise to wide-spread plans for Americanization.

More definite were the effects of the war on the prohibition movement.
For many years a small but growing minority of reformers had urged the
adoption of means for stopping the use of intoxicating liquors and they
had been successful in procuring constitutional amendments in about half
the states by the close of 1916. The war presented an opportunity for
further progress. In September, 1918, they procured the passage of a
resolution in Congress allowing the President to establish zones around
places where war materials were manufactured; liquors were not to be
sold within these areas. Soon afterward the manufacture of beer and wine
was forbidden until the conclusion of the war, on the ground that the
grains and fruits needed for the production of these beverages could
better be used as foods. In the meantime a federal constitutional
amendment establishing prohibition had been referred to the states for
ratification. By January 16, 1919, it had received the necessary
ratification by three-fourths of the states and took effect a year
later.[11]

The railroads constituted another difficult problem. Agreement seemed to
be general that they could not be relinquished by the government to
private control without significant changes in existing legislation, and
several forces, especially the insistence of the President and of the
opponents of government ownership, combined to spur Congress to act on
the matter at an early date. The Esch-Cummins law of February 28, 1920,
was an important addition to the body of interstate commerce
legislation. It enlarged and increased the powers of the Interstate
Commerce Commission; it authorized the Commission to recommend
government loans to the railroads; established a Railroad Labor Board to
settle disputes between the carriers and their employees; empowered the
Commission to require the joint use of track and terminal facilities in
emergencies; forbade the construction of new lines and the issuance of
stocks and bonds without the consent of the Commission; directed the
preparation and adoption of plans for the consolidation of the railway
properties into a limited number of systems; permitted pooling under the
authorization of the Commission; and provided for the accumulation of
reserve funds and a fund for purchasing additions to railway equipment.
Whether a final solution of the transportation problem or not, the new
act embodied much of the experience gained since the passage of the law
of 1887.

In the field of politics and government an important part of
reconstruction was the readjustment of relations between the federal
executive and Congress. During the war it was inevitable that the
President should provide most of the initiative in legislation; but it
was likewise inevitable that the legislative branch should reassert
itself as soon as possible. The fact that the consideration of the
Treaty of Versailles necessarily concerned the Senate rather than the
House of Representatives, gave the upper chamber an opportunity to
attempt the repression of executive power to the proportions which had
characterized it immediately before the war. Moreover if the members of
the Senate should imitate the example of their predecessors in the
conflict with President Johnson in 1867, that body might attempt to
regain for itself the primacy in the federal government which had been
partially lost under Cleveland's regime and completely superseded
through Roosevelt's development of the presidential office.

The course of the Treaty in the Senate was such as to stimulate any
friction which might result from the difficult process of
reconstruction. Despite the early sentiment favorable to prompt
ratification, that part of the Treaty which related to a League of
Nations met a variety of opposing forces. Some of them were based on
personal, political and partisan considerations, and some of them
founded upon a sincere hesitancy about adventuring into new and untried
fields of international effort. In the main, party lines were somewhat
strictly drawn in the Senate, the Democrats favoring and the Republicans
opposing ratification of the treaty as it stood.[12] All debates in the
Senate relating to the treaty were for the first time in our history
open to the public, and popular interest was keen and sustained. Among
people outside of Congress party lines were more commonly broken than in
the Senate, and members of that body were deluged with petitions and
correspondence for and against ratification. At length it appeared that
a considerable fraction of the Senate desired ratification without any
change whatever, a smaller number desired absolute rejection and a
"middle group" wished ratification with certain reservations which would
interpret or possibly amend portions of the plan for a League of
Nations--portions which they felt were vague or dangerous to American
interests. After long-continued discussion, the friends of the project
were unable to muster the necessary two-thirds for ratification, and its
enemies failed to obtain the majority required to make amendments, and
the entire matter was accordingly postponed, pending the results of the
presidential election of 1920.

The United States, therefore, found itself after the close of the World
War in much the same position that it had been in more than half a
century earlier at the end of the Civil War. The unity of purpose and
the devotion to ideals which had overcome all difficulties during the
combat had seemingly, at least, given way to partisan diversity of
endeavor, to strife for supremacy in government and to the avoidance of
the great problems of reconstruction. Time, patience and controversy
would be necessary to bring about a wise settlement. The United States
was face to face with the greatest problems that had arisen since the
Civil War.


BIBLIOGRAPHICAL NOTE

The opposition to the Wilson foreign policy is best expressed in
Theodore Roosevelt, _Fear God and Take Your Own Part_ (1916).
Roosevelt's condonation of the invasion of Belgium is in _The Outlook_
(Sept., 1914), "The World War." Wilson's changing attitude toward the
war is explained in A.M. Low, _Woodrow Wilson, an Interpretation_
(1918), but is best followed in his addresses and messages. The early
stages of the war and American interest in it are described in Ogg; _The
American Year Book_; J.B. McMaster, _The United States in the World War
_(1918); J.W. Gerard, _My Four Years in Germany_ (1918), superficial but
interesting and written by the American Ambassador; Brand Whitlock,
_Belgium_ (2 vols., 1919), verbose, but well written by the United
States minister to Belgium; Dodd, already mentioned; J.S. Bassett, _Our
War with Germany_ (1919), written in excellent spirit. The President's
address calling for a declaration of war is contained in the various
editions of his addresses, and in _War Information Series_, No. 1, "The
War Message and Pacts Behind It," published by the Committee on Public
Information.

The subject of federal agencies for the prosecution of the war is fully
discussed in W.F. Willoughby, _Government Organization in War Time and
After_ (1919); there is no adequate account of the Committee on Public
Information. On the government and the railroads, consult F.H. Dixon in
_Quarterly Journal of Economics_ (Aug., 1919), "Federal Operation of
Railroads during the War." E.L. Bogart, _Direct and Indirect Costs of the
Great World War_ (1918), is useful.

Combat operations are described in the general histories of the war
already mentioned, and in "Report of General Pershing" in War
Department, _Annual Report_, 1918.

Accounts of the Peace Conference, the Treaty and the League of Nations
labor under the attempt to prove President Wilson right or wrong, in
addition to such insurmountable difficulties as lack of information and
perspective. J.S. Bassett, _Our War with Germany_ (1919), has some
temperate chapters; Dodd is friendly to Wilson, but not offensively
partisan; R.S. Baker, _What Wilson did at Paris_ (1919) is readable;
J.M. Keynes, _The Economic Consequences of the Peace_ (1920), is
interesting and designed to prove a point; see also C.H. Haskins and
R.H. Lord, _Some Problems of the Peace Conference_ (1920); the account
in the _American Year Book_ for 1919 lacks something of its usual
non-partisan balance. On the League of Nations a thorough study is
S.P.H. Duggan, _The League of Nations_ (1919). Material opposing the
treaty may be found in _The New Republic_, _The Nation_, and the _North
American Review_; favorable to it is the editorial page of the New York
_Times_, whose columns contain the best day-to-day accounts of the
debates in the Senate.

A full bibliography is A.E. McKinley (ed.), _Collected Materials for the
Study of the War_ (1918).

       *       *       *       *       *

[1] As a result of this incident the Senate decided to limit somewhat
its rule allowing unlimited debate. Under the "closure" rule adopted
March 8, 1917, a two-thirds majority may limit discussion on any measure
to one hour for each member.

[2] War was declared against Austria on December 7, 1917. The United
States was followed immediately by Cuba and Panama, and before the close
of the year by Siam, Liberia, China and Brazil. Many other Central and
South American states severed relations with Germany and before the
close of the struggle several of them declared war.

[3] The purpose and effect of Wilson's patient foreign policy were
briefly expressed by Joseph H. Choate, a Republican advocate of early
entry into the war, in a speech in New York on April 25, 1917. Choate
declared that a declaration of war after the _sinking of the Lusitania_
would have resulted in a divided country and remarked: "But we now see
what the President was waiting for and how wisely he waited. He was
waiting to see how fast and how far the American people would keep pace
with him and stand up for any action that he proposed."

[4] An official of the War Department estimated that the lumber used in
the sixteen cantonments if made into sidewalks would go four times
around the world.

[5] Roumania had entered the conflict in August, 1916, but had been
immediately overrun, her capital Bucharest taken in December, and that
country rendered no longer important before the entrance of America.

[6] The earlier draft law resulted in about 11,000,000 registrants. The
draft ages were 21-30 years. Under the later law the ages were 18-45.

The so-called Training Detachments had already been established,
providing for the training of mechanics, carpenters, electricians,
telegraphers, and other necessary skilled artisans at a number of
colleges and scientific institutions.

Almost coincidently with the expansion of the army came an epidemic of
the Spanish influenza. Hitherto the health of the army had been
extraordinarily good, but the epidemic was so widespread and so
malignant in its attack that during eight weeks there were more than
twice as many deaths as in the entire army for the year preceding.

[7] By November 11, 26,059 prisoners and 847 guns had been captured and
at one point near Sedan the American advance had covered twenty-five
miles. 1,200,000 American troops had been engaged and the weight of the
ammunition fired was greater than that used by the Union armies during
the entire Civil War. In November the American army held twenty-two per
cent. of the western front. The losses of the A.E.F. during the entire
period of its activities up to November 18, 1918, were by death 53,160;
the wounded numbered 179,625.

[8] An armistice had been signed with Turkey on October 31, and with
Austria on November 4.

[9] Something little short of a revolution in American international
relations was taking place when the President of the United States
received in Paris lists of callers such as that mentioned in the
newspapers of May 17, 1919:

    Prince Charron of the Siamese delegation; Dr. Markoff, of the
    Carpatho-Russian Committee; M. Ollivier, President of the French
    National Union of Railwayman; M. Jacob, a representative of the
    Celtic Circle of Paris; Messrs. Bureo and Jacob of the Uruguyan
    delegation; Turkhan Pasha, the Albanian leader; Enrique Villegas,
    former Foreign Minister of Chile; Foreign Minister Benez and M.
    Kramer, of the Czecho-slovak delegation, to discuss the question
    of Silesia and Teschen; Deputy Damour, concerning the American
    commemorative statue to be erected in the Gironde River; a
    delegation from the Parliament of Kuban, Northern Caucasus; the
    Archbishop of Trebizond, Joseph Reinach, the French historian, and
    Governor Richard L. Manning of South Carolina.

[10] The Secretary of War estimated the total of all these groups at
13,650.000

[11] The Eighteenth Amendment is as follows: Section 1. After one
year from the ratification of this article the manufacture, sale, or
transportation of intoxicating liquors within, the importation thereof
into, or the exportation thereof from the United States and all
territory subject to the jurisdiction thereof for beverage purposes
is hereby prohibited.

Section 2. The Congress and the several states shall have concurrent
power to enforce this article by appropriate legislation.

Section 3. This article shall be inoperative unless it shall have been
ratified as an amendment to the Constitution by the legislatures of the
several states, as provided in the Constitution, within seven years from
the date of the submission hereof to the states by the Congress.

[12] As the Congress that which had been elected in 1918, the Senate was
controlled by the Republicans.