the position I take, which is that during war excitement matters like
these are brought
Mr. STEELE. If we can Lave an agreement, that is all right; but I
do object to taking the forenoon in order to find out whether anybody
is going to object. It becomes a very puerile business.
Mr. HAY. I want to make a suggestion to the gentleman from Iowa,
if the gentleman will permit me. My suggestion is this
Mr. FARIS. Mr. Speaker, I rise to a point of order. We can not
The SPEAKER. Is there objection to the consideration of the bills
named by the gentleman from Iowa on Tuesday, after the reading of the
Mr. UNDERWOOD. If we can not come to an agreement with the
gentleman from Iowa, I will object.
Mr. HULL. I can not take those bills out, because I am informed, and
the whole investigation made shows, that these two corps of the Army
need the increase badly now, and would need it badly if the war should
Mr. UNDERWOOD. Will the gentleman guarantee that he will give
us ample opportunity on Tuesday to debate the bills and offer amend-
Mr. HENDERSON. That ought to be done. There ought t fct the
fullest opportunity for discussion.
Mr. HULL. Of course; I will do that.
Mr. M AH ANY. I would like the chairman to state what he means by
"ample time for discussion." Is there not a likelihood that under this
arrangement some of these bills may be debated to such an extent that
the others will not be reached?
Mr. STEELE. Mr. Speaker, I call for the regular order.
Mr. DOCIEBT. I assume that the gentleman will give opportunity
for full discussion.
Mr. STEELE. I withdraw the call for the regular order.
The SPEAKER. Is there objection?
Mr. CODDING and Mr. BAIRD objected.
But, Mr. Speaker, all these were not in my mind at the date of the
speech complained of, but I think they were in the mind of the gentle-
man from Maine at the time of his speech, but I confess I had in my
mind the vote of the Democrats on the revenue bill, and here we might
as well call things by their right names. The war-revenue measure was
a measure to provide money to pay for the cost of the war in all the
branches thereof. It was a patriotic measure, demanded by the country
and indispensable to the maintenance of the honor of our country and
the success of our Army. The bill was reported from the Committee 001
Ways and Means on the 26th day of April, three days after the declara-
tion of war, and debate proceeded until, as appears by the RECORD, page
4855, a vote was taken, and on the passage of that bill 5 Democrats
voted in the affirmative and 130 Democrats and their allies voted "no."
On the preceding page of the RECORD it will appear that on a motion
to recommit 134 Democrats voted to kill the bill and 170 Republicans
voted against that unfriendly proposition. Later on this same revenue
bill came back to the House remodeled in some respects, and passed by.
the Senate. The whole question of amendment had been fought out
in the Senate and in conference committee, and on that day the whole
question came to a vote in the House, and it is true to say that on
that vote turned the whole question of war or peace, and on that
question hung every hope of supplying the Army, and on that vote 149
Republicans and 5 Democrats voted in the affirmative, and 106. Demo-
crats and their allies voted "no."
During the progress of this controversy there were propositions raised
by the Democrats to raise some money for the use of the Army by a
taxation of incomes, but those propositions were not important, for had
their income propositions been accepted it would have been but a com-
paratively trifling addition to the gross amount of revenue necessary
for the purpose of the Government, so that the record stands just this
way: A majority of the House of Representatives being Republican
provided a measure amply sufficient to carry on the war, pay the soldiers,
provide for pensions and the defenses of the country, and the Democrats
After the measure had gone through a long and weary consideration,
and after making compromise after compromise and concession
after concession, and a measure had been agreed upon the best and
only thing that could be done, as everybody knows, with the exception
of five or six these Democratic members voted "no" to every propo-
sition, and to that I referred in my Columbus speech, and to that 1
adhere. It will not do to say that the Democrats were ready to have
voted for a provision for the Army if they could have had certain amend-
ments; they had had all these amendments offered and they had all
failed. Shall the question of free and unlimited coinage of silver be
permitted now to stand across the pathway of the great interest of the
Army? Yet upon that question the Democratic party here took its
stand, and it will be held responsible. I do not believe that the Demo-
crats of this country indorse this record, and I do not believe that they
will indorse it in November.
Now, there was a proposition pending in the House to permit the
soldiers in the field to vote for Congressmen. It had the solid vote of
the Republicans in the House and a few Democrats joined, but the
bulk of the Democratic party, led by its distinguished leader, fought
it to the bitter end, and would have defeated it had they had votes
enough. It was finally defeated in the Senate by the Democratic Sen-
ators, and in this way 250,000 men, just as capable of voting intelli-
gently as any member of this House, are deprived of voting for Con-
They are fighting the battles of their country out in the jungles of
Cuba and far out in the seas of the Orient, but the Democratic party
in Congress refuses them the right to vote. We shall be permitted to
charge, and we will charge, as I now charge, that they were refused the
right to vote by the Democrats. So, Mr. Speaker, I am justified by
record in all that I said. The last hours of the Plouse witnessed the oft-
repeated appeal of the chairman of the Military Committee for 'action,
by the House, on important bills, but his appeal was in vain.
It will be said that the Democratic members would have voted for
the annual and special appropriation bills, but what would it have bene-
fited the countr.y to have made appropriations with no money to pay
them? The vital support of the Administration was the war-revenue
bill. It will take $200,000,000 more than the taxes to carry us to the
1st of January next, and four hundred millions if the war is to last a
Could we have put $500,000,000 of taxation upon the people in a
single year in addition to the tax now existing it would have crushed
the life out of the industries. We took care that the old cry of idle
silver should be heard no more in the land, for we have provided for
the coinage of the surplus silver in the Treasury.
Additional Treasury Notes
THE TELLER RESOLUTION
TO COIN SILVER DOLLARS ON PRIVATE ACCOUNT AND
PAY THE NATIONAL BONDS WITH THEM
HON. ICNUTE NELSON
In the Senate of the United States, January 29 and May 27, 1898
UNITED STATES BONDS PAYABLE IN SILVER
The Senate having under consideration the concurrent resolution (S. R.
2:1) declaring United States bonds payable in silver dollars
Mr. NELSON said:
Mr. PRESIDENT: I offer an amendment to the pending resolution, and in
connection with it I desire to submit a few statements. When a witness is
sworn in court he is not only sworn to tell the truth, but the whole truth
and nothing but the truth. So with the resolution that Is now pending
before the Senate. It does, to a certain extent, declare the technical truth,
but not the whole of it by a great deal.
It is true that under existing laws, technically, the Government can pay
its obligations in every instance, except where the law otherwise provides,
in either gold or silver. But coupled with th|t right is a duty a duty en-
joined upon the Government to maintain the parity of the two metals.
This duty rests upon two grounds a statutory mandate and changed
conditions in the relative value of the two metals. The Government has
the technical right to pay its obligations in gold or silver, but coupled with
that right is the duty always to maintain the parity of the two metals. I
can pay my debt in silver or gold if I have not obligated myself to pay in
gold, but I have not the duty to perform that the Government has that of
maintaining the parity. The Government has the right to pay in either
silver or gold, but coupled with that right is the duty enjoined xipon it by
law by two existing, laws, that of 1890 and 1893 under all conditions to
maintain the parity in value.
IN 1878 THE SILVER IN A SILVER, DOLLAR WAS WORTH 90
CENTS IN GOLD.
Senators have stated on this floor that the conditions are now the same
as they were when this resolution was passed in 1878. Mr. President,
neither as a matter of fact nor as a matter of law is that true. As a matter
of fact, in 1878, when the resolution was passed, the silver in the silver
dollar was worth about '90 cents in gold. To-day it is worth only 44 or 45
cents in gold. At that time we had no law on our statute book requiring
the Government to maintain the parity of the metals. That was not placed
in the law of 1878. It was ilot in existence at the time that resolution was
In 1890, when the so-called Sherman law, providing for the extensive
purchase of silver, was passed, the duty of maintaining the parity was first
enjoined in that law. Seme of the Senators who aided in passing that law
are now, in effect, seeking by this resolution to destroy the effect of the
parity requirement. This is the provision of the law of 1890:
That upon the demand of the holder of any of the Treasury notes herein
provided for, the Secretary of the Treasury shall, under such regulations
as he may prescribe, redeem such notes in gold or silver coin, at his discre-
tion, it being the established policy of the United States to maintain the
two metals on a parity with each other upon the present legal ratio, or
such ratio as may be provided by law.
Here you have a statutory declaration of duty, a mandatory duty, laid
upon the Government in connection with the monetary legislation that was
procured at the instance of the advocates of free silver at that time. My
objection to the resolution in the present condition is that while it an-
nounces the technical right of the Government to pay in either metal, it
utterly ignores the duty of maintaining the parity. This same duty was
reiterated and enjoined in the act of 1893. If the Government adheres to
the duty laid down in both of these acts, and maintains the parity of the
two metals, then it will make no practicaj dilfereiice in which coin the
bonds are paid.
If this resolution is correct it does not go far enough. If our bonds are
payable, as the resolution says, so are our greenbacks and so are the notes
issued under the act of 1890. If you add the amendment which I introduced
the other day, and shall offer to-day, and attach it to the resolution, in
legal effect the two together would be exactly the language of the act of
1890, giving the Secretary of the Treasury the option to pay the Treasury
notes issued under that act either in gold or silver, with the condition that
it was always the duty of the Government to maintain the parity of the
two metals. Unless you object to the maintenance of the parity unless
you aim by indirect means to destroy that parity you can certainly have
no objection to the amendment to which I refer.
"I CAN NOT PAY YOU IN GOLD."
Let me also call attention to the fact that whenever the .Government fails
in its duty to maintain the parity it is not only the bondholders who suffer,
but every one of us who holds any of Uncle Sam's money except gold coin.
If the Government of the United States, when a creditor comes and de-
mands payment of any of its obligations, whether it be a bond or a Treasury
note, shakes its head and says "I can not pay you in gold; that is the
dearest metal; I will pay you in the cheaper, silver" whenever the Govern-
ment assumes that attitude and refuses to pay either a greenback, a Sher-
man note, or a bond to the holder in gold, when he demands it, that moment
and in that act the Government discredits its silver money and says it is
not as good as gold, and that brings us on a silver basis immediately, when
silver will circulate on its bullion value.
What is the difference between our silver dollar and the Mexican silver
dollar? Down in Mexico they have a silver dollar with a little more silver
in it than ours. There they have the free coinage of silver. Yet that silver
dollar is worth only 45 cents in gold, because there is nothing back of it.
It circulates upon its value as silver bullion merely.
Our silver dollar is worth 100 cents in gold. Why? Because the Gov-
ernment of the United States, our law, and our policy, and our practice
stand back of it and make that silver dollar as good as a gold dollar. By
standing pledged to maintain the parity, by being ready to redeem all our
paper in gold, and by receiving the silver dollar in payment of all public
dues as equivalent to a gold dollar, we maintain the parity. Our American
silver dollar can say what the Mexican silver dollar can not s<ay, "I know
that my redeemer Uncle Sam liveth."
If our friends on the other side seek to pass this resolution without
providing that the Government shall maintain the parity, then they are
indirectly seeking to bring about a state of silver monometallism, though
this may not be their avowed purpose.
Mr. President, if it were only the bondholders they would injure, thai
would be bad, but not the worst of it. But the bondholders are not the
only ones who would suffer. Whenever you cut down our currency by such
methods, whenever you Mexicanize our silver, you not only punish the bond-
holders, but punish every citizen in the United States who has any of our
currency, except gold. Every dollar of greenbacks, every dollar of Sherman
notes, every silver dollar, and every national-bank note is at that moment
cut down to the bullion value of silver.
ONLY $850,000,000 BONDS OUTSTANDING.
There are only $ v ^0,000,000 bonds outstanding, while our greenbacks and
Sherman notes, our silver and silver certificates, and our national-bank
notes exceed, in the aggregate, over $1,100,000,000, nearly all ef it out-
standing and in circulation. To put us on a silver basis, you. would not
only reduce the value of the bonds more than one-half, but also the value
of all this currency, a loss that would reach every holder of this money.
And, in addition to all this, you would further contract the currency, by
driving our gold money abroad and out of circulation.
You not only punish the bondholders if that Avas the extent of your
punishment, though unjust, we might stand it but you strike at every
man who has any of the money of this Government in his possession. You
not only strike him down, but you reduce the wages of the laboring man;
you reduce the value of saving deposits and of all outstanding money ob-
ligations. And thus you would bring about a public calamity much more
serious than even you contemplate or intend.
Mr. President, I am not here shedding tears for the bondholders, but I
am here to protect the American people from the calamity of silver mono-
WAYS AND MEANS TO MEET WAR EXPENDITURES.
The Senate, as in Committee of the Whole, having under consideration
the bill (H. R. 10100) to provide ways and means to meet war expenditures
Mr. NELSON said:
Mr. PRESIDENT: I propose for a few moments to discuss the proposed
issue of an additional $150,000,000 of greenbacks or United States Treasury
notes. I regard that as one of the most important matters involved in t'he
The first issue of United States Treasury notes was under the act of
February, 1862. The highest amount outstanding was in 1864, when it
amounted to $447,300,203. Since 1878 the net amount outstanding has been
$.'!46,681,016. There has been issued and reissued in all a total of $2,876,020,-
129, or a quantity equal to nearly 8.3 times the amount outstanding at any
time since 1878. These notes are receivable in payment of all taxes and
public dues except customs. Prior to July 1, 1879, $1,151,572,362 of these
notes were redeemed by being received in payment of public dues and taxes.
Since June 30, 1879, $1,477,766,753 have been redeemed, but of this redemp-
tion $516,030,273 have been redeemed on demand by direct payment of gold
to the holder. Of this direct gold redemption, only $13,310,896 was made
between July 1, 1879, and July 1, 1892; and from July 1, 1897, to the present
time only $21,523,345 have been redeemed.
But for the period of five years extending from July 1, 1892, to July 1,
1897, $451,196,132 was directly redeemed, on demand of the holders, in
g-old. An average of $90,000,000 per year, or only $10,000,000 less than the
gold redemption fund, thus necessitating its duplication once a year in
that time. During this period of hard times, within the memory of all, the
Treasury was treated as the reservoir, and the greenbacks as the instru-
ment, for satisfying the excessive gold demand of our people. This exces-
sive and unusual gold witkdrawal occurred chiefly from two causes. In
the first instance it arose from the fear that the excessive silver inflation
under the act of 1890 might destroy the ability of the Government to main-
tain the parity of our silver currency with gold. This fear of coming to a
silver basis led many of our people to seek gold for purposes of hoarding.
GOLD DEMAND TO SATISFY AN ADVERSE BALANCE OF TRADE.
In the next place the gold demand came, to a large extent, for the pur-
pose of satisfying an adverse balance of trade. And by this I mean an
adverse balance upon all our transactions with foreign countries, whether
arising from commerce or credits; for all international balances are settled
and adjusted with gold. Since July 1, 1897, our shipment of breadstuffs
and other products abroad at high prices and in great quantities has been
so large that it has kept the balance of trade in our favor and brought us
a constant inflow of gold, which would have been even greater but for the
credit balance against us in Europe.
This large inflow of gold from this cause has reduced the gold redemp-
tion of our greenbacks to well-nigh a nominal basis. But the conditions of
the past year have been so unusually favorable, especially in the matter of
breadstuffs, that we can not well count on their permanent continuance
nor make thsm the basis of our calculation for the maintenance of the gold-
redemption fund. Caution and prudence should rather lead us to base our
calculation on the recurrence of such times and conditions as we labored
under from 1892 to 1897.
Our Treasury notes are not only money of a certain kind, but they are
also due bills, evidences of demand loans. As mere loans they are not of
very much help or benefit, unless redemption is temporarily stayed as
during the late war. If the holder can demand payment at any time, the
Government must of necessity always keep on hand an idle fund for re-
demption purposes. For it occupies, as a mere debtor, the relation to the
Treasury notes that a bank does to its depositors or its bill holders. It
can not redeem by giving new notes of a similar kind, for that would
simply be Alieawber-like to give one due bill for another.
THE GOVERNMENT MUST OF NECESSITY REDEEM IN COIN.
The Government must of necessity redeem in coin, and, technically, it
can redeem in either coin gold or silver. If both metals were intrinsically
on -a parity with each other, then the Government would be justified in
availing itself of the technical right to pay in either metal. But, com-
mercially and intrinsically, silver is far below a parity with gold, and
hence arises the duty enjoined upon the Government, both by law and
morale, of maintaining our silver money on a parity with gold.
The holder of a Treasury note is not only interested in having his note
redeemed, but he is also interested in having it redeemed in, and kept up to,
the value of our best money, that which is intrinsically highest gold
for that is of necessity and in the very nature of the case the only true
standard of parity. To maintain this parity the Government must always
be ready and able to redeem its notes in that money gold which is in-
trinsically the most valuable, if demanded. If the Government refuses to
redeem in its best money when demanded, it by that very act discredits its
intrinsically cheaper money; and if it insists on redeeming in the cheaper
money it in effect makes that the standard and level of value, and the
monetary parity of the two metals is gone.
The issue of these demand Treasury notes, then, entails a double duty
and a double burden upon the Government: First, the duty and burden of
a banker to its depositors or bill holders of always maintaining an ample
redemption fund on hand; second, the duty and burden, as the financial and
fiscal agent of our nation, to maintain these notes as money on a parity
with our best money gold. In other words, the Government must main-
tain these Treasury notes both as due bills and as money, and to maintain
them as such it must always ha.ve on hand an ample gold redemption fund.
But both of these burdens and duties are of a shifting, fluctuating, and
uncertain character, dependent on a variety of conditions and circum-
stances entirely beyond the control or guidance of the Government. A
banker can never to a certainty predict or foretell the amount of the de-
mand the depositors or bill holders will make upon him at any given time.
In good, prosperous times the demand will be moderate; in hard, bad
times it will be excessive, and in times of panic ii will amount to a raid and
complete destruction. In good times the reserve can run low, but in bad
times it must be large and ample, for the demand upon it will be much
greater. Our sound banks never kept such large reserves as they did in
the bad times of 1893, 1894, and 1895. Their reserves were so large that
they derived no substantial profits from their deposits.
GOVERNMENT AS A MERE DEBTOR TO ITS BILL HOLDERS.
And so it is with the Government as a mere debtor to its bill holders.
In prosperous times the call for redemption is slight and the circulation
is ample. In hard times the call for redemption is excessive ajid the circu-
lation is nominal. But there is one anomaly the Government labors under
that the bank is free from. The Government is never done with redeeming
no matter how much it redeems, for under the law as soon &n it redeems
a note it must at once reissue it. Redemption relieves the bank from the
burden, but with respect to the Government as to ita Treasury notce re-
demption does not redeem.
While the redemption demand upon the bank may be uncertain and
fluctuating, it has nevertheless a limit. With the Government the redemp-
tion demand is not only uncertain, but it is utterly without limit; and it is
this fact which embarrasses and handicaps the Government more than any-
thing else. It places it completely at the mercy of the whims and neces-
sities of the holders of the notes, who, as a rule, are governed by their own
But the duty of responding to this illimitable redemption demand is
further aggravated by the fact that the redemption fund must be kept in
gold, owing to the disparity between the two metals and for th sake of
maintaining the parity. The Government can not artificially regulate the
inflow of gold except by purchase. Outside of this the inflow or outflow
of gold is wholly dependent upon trade and business conditions. If the
balance of trade, so called, is, as a whole, in our favor there will be an
inflow of gold, more or less, in proportion to the balance in our favor. But
if the balance of trade is against us, then there will be an outflow of gold
measured by such balance. We are still a debtor nation, and for some years
to come the balance on that score will be against us. We shall have to
overcome that balance by the balance in our favor \ipon the sale of our
products raw and manufactured and it is only the excess of such balance
over tlie credit balance which gives us the substantial balance that brings
the inflow of gold.
But it is evident, on reflection, that our trade balance rests npon at least
two grounds, is dependent upon at least two contingencies first, on our