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Speech of Hon. George W. Morgan, delivered at Canal Dover, Ohio, August 7, 1875 online

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SPEECH



OF



HON. GEORGE W. MORGAN,



DELIVERED AT



Canal Trover, Ohio, A-Ug-ust 7^, IST'S.

[published by order of DEM. STATE EX. COM.]



Ladies and Fellow-Citizens of Tuscarawas County : I ask your indulgence in
the opening of my remarks until my voice becomes accustomed to the place in which I
am to speak. It is true, as you have been told, that Governor Allen is not with us in
person, but his heart and thoughts and best wishes are with us, and he sincerely regrets
that he is not hei'e to greet you.

I am one of those, my fellow-citizens, who believe that the great body of the Amer-
ican people, irrespective of party, are honest, intelligent, brave and patriotic. In my
youth and the ardor of early convictions I was, perhaps, not so tolerant in my views, but
experience and observation have taught me a truer appreciation of American character,
and I now understand how it may be that honesty and error may exist together. Had
I not such a faith I would •despair of the possibility of maintaining free institutions.
Our country belongs to no party, but to the whole people, who hold it as a sacred trust
for our children and our children's children after we have passed away. Parties aro
essential to the existence of free institutions, but it is always necessary that jhe party
in power should have a party out of power to watch its administration of public affairs,
and if that administration has been wise and honest it should be continued and upheld.
On the other hand, if it becomes corrupt, there should be a change. We are assembled
to-day, fellow-citizens, for the purpose of discussing a question of vital importance to us
all — a question afl'ectiug not only the Democrats, but the Republicans as well — affecting,
in fact, the welfare and prosperity o:£ the whole people, and I shall endeavor to present
facts for your consideration with as much gravity and decorum as if I were rising in the
halls of Congress to address the legislators there assembled. Before proceeding, how-
ever, I wish to say a few words as to a false issue which Republican leaders seek to
introduce into this canvass, in order to withdraw the attention of the people from the
wrongs they have committed and the evils they have brought upon the country at
large.

You all know that the Convention that made the Constitution of Ohio under which
we live had a Democratic majority, and that William Medill, afterward a Dem-
ocratic Governor, was its President, and that William H. Gill, its Secretary, was also a
Democrat. You are aware that this Democratic Constitution was ratified by an over-
whelming majority of the voters of Ohio, and that to-day it is the fundamental law of
our State. The Republican leaders, through secret circulars, seek to create the impres-
sion that the Democratic party desired to divide the school fund, and give a part of it to
one religious sect. I have just shown you that the Constitution was made by a Demo-
cratic Convention, was adopted when Ohio was a Democratic State, and is, in its pro-
visions, a Democratic instrument, and we will see what it says on that subject. Article
VI., Section 2, says :

" The General Assembly shall make such provision by taxation or otherwise as, with
the income arising from the School Trust Fund, will secure a thorough and ethcient sys-
tem of common schools throughout the State ; hut no religious or oiher sect or sects shall
ever have any exclusive right to, or control of, any ^art of the school fund of this State."



Certainly it will not require argument to prove that if six hundred millions conld be
collected, as they were collected in the year following the war, that the same amount
could have been raised with much greater ease before the country was exhausted by
the drain of war — before a million of men had been withdrawn from production and
converted into consumers This fact not being open to dispute, I will proceed I o demon-
strate that if the natural system of finance had been adopted the expenditures of the
war would have been fully paid without the creation of one dollar of interest- bearing
debt, and that by the ".Wth of June, 18(58, there would have been afloat only a little over
a thousand millions of currency, instead of the twenty hundred millions which was ont-
standiug at the close of the war, and with a public debt of twenty-six hundred millions
on the aOth day of June, 1868. (See Finance Report, page 49fi.)

Now, for the facts, and, once for all, I refer you to pages 490, 491, 492, 493 and 494 of
the Finance Report for 1874 In th^ first year of the war the expenditures of the Federal
Government were $456,000,000, while the taxes collected amounted to only $52,000,000,
thns making a grand stride toward that marvelous blessing — a public debt. Had the
Federal Go-^ernment, in the first year of the war, issued ,|500, 000,000 of greenbacks, and
collected $500,000,000 of taxes, the greenbacks would have gone into circulation in the
payment for supplies, and been returned to the Treasury in the payment of taxes ; and
at the close of the year there would have been a balance of $44,000,000 greenbacks in
the Treasury, and there would not have been one dollar of bonded debt.

During the second year of the war the expenditures amounted to $694,000,000, while
only $112,000,000 of taxes were collected ; and another big stride was then taken toward
th6 creation of the public debt. Had $150,000,000 of additional greenbacks been issued,
and $500,000,000 of taxes been collected, there would have been money enough, includ-
ing the balance in the Treasury, to have paid every dollar of the expenditures, and
created no bonded debt.

In consequence of the inflation induced by the system of reckless borrowing, in the
third year of the war, the expenditures ran up to eight hundred and eleven millions,
while only two hundred and sixty-three millions of taxes were collected, and a public
debt of eighteen hundred millions had been built up. If during that year five hundred
millions in taxes had been collected, and an additional two hundred millions of green-
backs been issued, there would have been a floating debt of only one hundred and eleven
millions, and no bonded debt, while the entire currency would have amounted to only
eight hundred and fifty millions.

By the continued process of borrowing and inflation, the expenditures of the Govern-
ment in the fourth year of the war amounted to $1,2X4,000,000, while only $323,000,000 of
revenue were collected, and " the blessing of a public debt " had swollen to the respect-
able sum of about $2,700,000,000. If during the last year of the war $500,000,000 of
taxes had been collected, and $200,000,000 of additional greenbacks been issued, and
applied upon the floating debt of the preceding year, and on the expenditures of the last
year of the war, as a result, at its close, there would have been a fl,oating debt of only
$625,000,000, with $1,050,000,000 of currency, and no bonded debt. But as the finances of
the country were managed, at the close of the war there was $2,000,000,000 of currency
and a public debt of $2,700,000,000. This brings us to the first year of peace.

Now, you will remember, citizens, that I have shown you that in the very first year of
peace the revenues of the Federal Government actually did amount to $620,000,000, or
within $5,000,000 of what the entire debt of the country might have been (not including
the greenbacks) at the close of the war. Then, to ascertain what wouLi have been our
condition at the close of the first year of peace, had the taxation system been adopted,
■we must add the net expenditures of the Government for the first year of peace, which
were $385,000,000, to the sum of $625,000,000, which would have been the amount of the
floating debt, and there would have been to pay the amount of $1,010,000,000. To meet
this there was the actual net revenue of $620,000,000 for that year; upon applying it to-
ward the payment of the $1,010,000,000 there would have been left at the close of that
year a floating debt of $390,000,000, and no more.

Now, the actual revenues for the second year of peace amounted to $490,000,000 ; and
if we add the net expenditures for that year, which actually amounted to $206.000,0<JO,
to what ought to have been the floating debt of $390,000,000, there would have been the
sum of $596,000,000 to have been paid. Applying upon that sum the $490,000,000 actu-
ally in the Treasury, there would have been left at the close of the second year of peace
a floating debt of only $106,000,000 to be paid. This brings us to the third year of
peace.

Had this taxation and greenback system been adopted at the outset of the war, the
third year of peace (1867-68) would have opened with a floating debt of $106,000,000,
and ended with $229,000,000 of net expen<litures, which, added together, would give
$335,000,000 to have been paid that year out of the Treasury. But the act.ual net tcv-
enue collected that year was $405,000,000, which would have paid off" the entire indebt-
edness of the Government (greenbacks not included, as they would have formed the
only currency), and left a balance of $70,000,000 in the Treasury.



In conclusion, had $500,000,000 of taxes been raised during each year of the war, and
$1,050,000,000 of gieenbaclis been issued during the same period, there would have been
in circulation on the 30th of June, 1868, $980,000,000 in frreeuhacks, with a balance of
$70,000,000 in the Treasury, and no bonded debt, and the country would now be in a
prosperous couditidU instead of beiuji threatened with general bMukruptcy and ruin.
But this would not have answered the demand of the banker and bondholder. The
debt was needed as a basis lor ttie two thousand banks which are fastened like leeches
upon the body politic. This would not have answered, for the wealth of those who de-
sired to invest in bonds woukl have been subject to taxation like the property of other
citizens.

With these facts before ua, fellow-citizens, the conclusion is irresistible that the
finances of the country have not been managed in the interest of the country, but for
the benefit of a handful of individuals who desired to become, and who have become,
millionaires.

But notwithstanding the debt was created without necessity, it rests upon the whole
people as a binding obligation, and by the whole people will be met. We will not fol-
low the example of the bondholders, when they repudiated the contract in which they
agreed to receive greenbacks in payment of the five-twenry bonds. No, the people are
not repudiators, but they will hold the men in power to a strict accountability for be-
traying them into the hands of the bondholders. They will hold them guilty for the act
which Sherman, and Steveuson, and Morton, and Butler all admitted would be an act of
repudiation, and which has placed an adtlitioual burden of hundreds of millions on the
shoulders of the tax-payers.

Iq the early history of our Government, Hamilton and his allies pointed to the grand-
eur and power of the British Guvwr.iinent as a proof of the soundness of the wretched,
dogma that a public debt is a public blessing. But his followers either forgot, and for-
get, the wide diflerence which exists betsveen the principles of a monarchy and those of
a republic, or they desired, and now desire, the overthrow of republican institutions.

Britaia is pov.'erful, but what is the conditiou of her people? With thirty millions of
inhabitants, she has only thirty thousand land-owners, and one-eighth of her rural and
one-third of her metropolitan population are paupers. Such are the blessings of a pub-
lic debt, and the law of primogeniture. Such are the blessings which the meu in power
seek to bestow on American citizens Such are the blessings which How from a Legis-
lature which protects an aristocracy and plunders the people. Such is the system
which the men in power seek to fasten on America. Our aristocrats, our bondholders,
have the absolute control of the Republican organization ; for thirteen years they have
had supreme control of Congress; and now, that the Republican organization is about
to be repudiated by the people, these aristocrats seek to gain control of the Democratic
party before it is placed in power. It matters but little iu England vrh;;ther the Whigs
or the Tories are in power, for in either case the legislation is iu the interest of the aris-
tocracy and against the people. But in this the bondholders will fail. The Democracy
are of the people and for the people, and in this contest of idle against active capital
they will be found on the side of industry and enterprise.

THE PRETENSE OF RESUMING SPECIE P.4.YMENTS.

Just now, my friends, avast deal is being said on the subject of resuming speci©
payments. The bondholders demand specie payments. The bankers demand specie
payments. What do these meu mean by a return to specie payments ? Do they mean
that at the option of the holder of a bank bill he shall obtain gold when he presents the
bank note at the bank counter ? No, they mean nothing of the kind. With banker and
bondholder resumption of specie paymeiiis means a further contraction of the currency ;
it rifeans less money : it means the still further shrinkage of all values, except gold and
bank stock and boiids : it meaus to make onedollir buy two dollars' worth of property;
it means to double the fortunes of tha money owners by act of Cougress.

No, fellow-citizens, these men, as I will prove to you, do not mean specie payments,
and they know that such a thing is now impossible In their avarice they have gone
money-mad Their bonds are worth twenty cents above par; their gold is worth from
twelve to seventeen cents above par, and their bank stock is from twenty-five to thirty-
three per cent, above i>ar, and they are not yet satisfied.

On the 14th of January last they passed a law throne h Congress entitled " An act to
provide for the resumption of specie payments" — a law which bears a lie ou its face, for
the law does not provide that the banks shall redeem th<nr paper in specie: there is not
the shadow of such a thing iu its provisions. What, then, is this law if It provides
that the Secretary of the Treasury shall, "as rapidly as practicable," have coined ten,
twenty-five and fifty-cent pieces iu silver, with which to redeem the fractional paper
ciirreticy now in ciroulativju. The amount is forty odd million dollars. How much have
they redeemed? Not a dollar— not a dime. Who among you have seen any of this



Bilvor currency in circulation ? Nofc one living man. And yet more than six months
have elapsed since that law was passed. Bat suppose they did issue this forty millions
chaufje of specie; how lonjjj would it be in circulation ? Six weeks would dry up the
last dime. Why? Because the men in power have by law depreciated the value of
paper money; they have prohibited it from porforrniu,^ all the fuiictioris of money;
they have })rovidei[ that paper money shall not be received as money in the payment of
two hundred millions paid at the custom-house as a tariff tax on imported goods ; they
have required you to pay Che bondholder his interest, in gold, and also require you to
receive paper interest from the bondholder, should he owe you. In short, by force of
law, paper mouey is made less valuable than specie, and were forty millions of specie
put in circulation it would at once be gobbled up by the bankcis and bondholders on
speculation, and the coiiatry would be left without small currency of any kind.

What next does this law provide? In a word, without goiuj^ through the details of
the bill, ic provides for the issue of three bundred aud eighty-two millions of new five
per cent, bonds, to be sold at par for gild, in order to substitute that amount of gold,
as they pretend, for the greenbacks i<i circulation. Where is the gold •'o come from ?
There is only one hundred millious in the United Sta'ies, and that is mostly owned by the
Government, and is used by the Government to pay gold interest to the bondholders^
and the bondholder sells his gold to the merchant who imports goods at a premium of
from 12 to 17 per cent. Where, then, is this three hundred and eighty-two millious of gold
to come from ? From Europe ? No, for the European States are forced to buy gold, and
have but little to spare. How, then, can the greenbacks be withdrawn from circulation ?
It can all bo done by the use of one huudred millious of gold, and when threee hundred
and eighty-two millions of greenbacks are withdrawn from circulation, there will be
left in their stead oaly one hundred rniilious of gold, and the volume of currency will
be reduced over two bundnd millions. We are now paying to the people in Europe tifcy or
sixty millions of gold interest iu semi-annual payments. Before it would leave the country
it would be invested and reinvested iu the five per cent, bonds, and through the process of
exchanges one huudred millions of gold would withdraw the entire three-hundred aud
eighty-tvyo millious of greenbacks. And, do you doubt, iny fellow-citizens, what would
be the effect of this further reduction of the currency ? Property would be sold at one-
fourth its value. Rolling mills, furnaces aud work -shops would be closed. Our mer-
chants would be ruined and forced to make assignments. The owners of mines would
be forced to stop work, aud hundreds of thousands of men, depending upon their daily
labor for their claily oread, would be thrown out of employment.

And, then, iu the midst of this accumulated disaster, tbe bondholder and the banker,
having control of all the money in the country, would buy up your property at twenty-
five cents on the dollar, and, as in England, the bondholders and the la'.d-owners would
be the self-same men. And, then, iu the midst of this moral death, when the cry of
huuger aud lamentation will be heard from every quarter, then the banker will take
turther advantage of this bill of iniquity, aud claim to be a special providence by fiood-
iug the country with irredeemable millions of bank paper. For, fellow-citizens, although
this bill pveteuds to provide for a return to specie payment, while it provides for the
withdrawal of every dollar of greenbacks, it authorizes bauks to issue b^nk notes with-
out limit, and without requiring a single note to be redeemed in coin.

Here, then, in its deformity, is this hollow scheme of ronuruing to specie payments.
Seuator Shermau s;iys that the volume of the currency should be reduced until tlie
paper dollar is ou a par with the gold dollar, but he does not undertake to say what
amount of reduction that would require. He does not fix the amount, because he
knows full well tbat the paper money of the country can never be ou par with gold
until papyr money is allowed to perform all the functions of money. And I denounce
this HO called resumption bill as a wicked scheme of robbery and plunder.

OUR PLATFOHM.

Now, citizens, that is their plan. For a moment let lis glance at ours. Wo propose
that the bank note circulation shall be withdrawn, aud that greenbacks shall be substi-
tuted in their place. We propose that the bonds owned by the banks shall be paid off,
and $17, r)OU,00U of interest be thus annually saved. The National banker is the only
man ou earth who draws interest ou his debts, ou what he owos, as well as on wha.t is
owed to him. He draws interest on his bonds, which is right, but he also draws interest
on his printed promissory notes, which is wrong If a banker holds your promissory
note you are required to pay bim interest, while if you hold his promis.sory note you
have to pay him interest again. It is certainly a bad rule which won't work both
ways.

Next, we are in favor of an increase of the. volume of currency. We mean more
monuy and a lower rate of interest. We mean that the business of the country shall be
revived. We say that money is too scarce; that the high rate of interest proves it;



that the want of public confideuce and the stagnation of trade, and that thousands of
failures all prove it.

As to the amount of money, we say that should he regulated by the demands of busi-
ness — that it can be regulated with exactness by the issue of interconvertible bonds bear-
ing a low rate of interest, bonds convertible into greenbacks and greenbacks into bonds.
These propositions are simple, and will be easily understood. The Eepublicans are for
less, and the Democrats for more money. The Eepublicans want bank notes, and to
pay the banks |17,500,000 for the use of the notes, over and above the interest paid on
loans. The Democrats want a greenback currency based on the faith of the Govern-
ment, and are opposed to paying the bankers interest on their debts. In 1865, the cur-
rency of the country, including certificates of indebtedness, five per cent, legal-tender
notes, seven-thirty notes, United States legal-tonders, or greenbacks, fractional cur-
rency, National and State bank notes, amounted to about $ii,000,000,000. The men in
power, acting in the interest of the banks and the bondholders, and against the interest
of the people, have reducad the volume of the currency more than $1,200,000,000, and
by so doing have prostrated the business of the country and ruined thousands of busi-
ness men.

Money has become dear. At what rate can you'borrow it here in Tuscarawas? In
the county of Knox, where I live, it can not be had for less than ten per cent., and is
difficult to procure. The order of things has been reversed. Money, which ought to be
cheap, has become dear, while your products, your iron, and coal, and wheat, and wool,
which ought to bring a good price, have become so cheap as lo become almost unproduc-
tive. Bonds have gone up ; bank stocks have gone up; gold has gone up ; while wheat
and wool and industries of all kinds have gone down. Without labor millionaires are
created ; the rich have been giovviug richer, while the poor have been growing poorer,
until within the past year the spectacle, hitherto without example, has been presented
of thousands of men, roaming abroad through the land asking for labor and bread,
which before they had never failed of obtaining. There is no one who does not know
that an article is cheap or dear because of its being plenty or scarce. The failure of a
wheat crops makes the price of wheat go up, while if it is a bountiful one the price
goes down. We want money plentiful and at a low rate of interest.

The men of Wall street tell us there is a plethora of money there. So there is. But
how does it happen ? Law and nature combine to make it so. The gold gambling
created by the law is done there. The intetest upon the public debt and the customs
dues flow through that street, and a constant current of money daily runs from the
West to the East. The railroad companies which earn their money in the West daily
ship the profits to the East. And when one of your farmers pays the freight on your
grain the money reaches New York before the grain has gone one-half the distance. So,
too, with the insurance companies We annually pay to Eastern insurance companies
five millions more than they pay back to the people of the State. Hence it is, unless
we have an abundant supply of currency, we will always be drained dry. We want a
sufficient supply to revive industry, secure low interest and good prices. In short, we
wish the weight which now depresses the business of the country to be removed. We
believe that this land of ours belongs to the people, and not to a handful of over-led
bondholders and bankers.

Years ago, when money was plenty, business brisk and prices good, we did not feel
this drain, because there was enough to send East, and enough left for the business of
the West. Then the farmer got good prices for his crops, the merchant good prices for
his goods and wares, the manufacturer good prices for his manufactures, and the work-
ing man good prices for his toil; and all of this has been changed to satisfy the hungry
greed of the banker and bondholder. The Republican laborer, or farmer, merchant, or
manufacturer, is just as much interested in a return to prosperity as are those of the
Democratic faith. It is in effect a conllict between the Western producers and the East-
ern bondholders, and if the people are not ready to lie down as serfs and permit the
mailed heel of the oppressor to be planted on their breasts, they will rouse themselves
to action on this great question. Go to New York to-day, and you will find the Demo-
cratic and Republican bondholders joined hand and hand in their common cause. And


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Online LibraryGeorge Washington MorganSpeech of Hon. George W. Morgan, delivered at Canal Dover, Ohio, August 7, 1875 → online text (page 1 of 2)