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Full text of "United States notes; a history of the various issues of paper money by the government of the United States. With an appendix containing the recent decision of the Supreme Court of the United States and the dissenting opinion upon the legal tender question"

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Ix the course of his official career the author lias had 
occasion to deal with subjects kindred to those presented 
in this volume. From time to time, he has collected 
material with the hope of publishing at some future 
day a volume worthy of the title of " History of Bank- 
ing in the United States." The results of these investi- 
gations have appeared from time to time, in official re- 
ports, occasional addresses, and in articles contributed 
to various encyclopaedias. The present volume is pub- 
lished in accordance with the request of many friends, 
who believe that at the present time a small volume 
containing a history of all the various issues of paper 
money by the Government will be useful and interest- 
ing to the public. 

The recent decision of the United States Supreme 
Court lias virtually placed it in the power of Congress 
to issue United States legal tender notes in any amount, 
at any time it may be deemed politic or advisable. A 



connected history of the paper money issued by the 
Government will enable the reader to trace the gradual 
rise and development of a doctrine which has at length 
been endorsed by so much weight of authority. 

At the date of the adoption of the Constitution, the 
issue of paper money in any form was popularly re- 
garded with aversion. The experience of the colonists 
with bills of credit, as paper money was then called, 
had been fraught with loss and political disturbance, 
and the experience with the like issues by the Contin- 
ental Congress had so affected the minds of the wisest 
and best men of that time, that in the Federal Conven- 
tion the general feeling was one of almost bitter opposi- 
tion to granting the power to emit bills of credit to the 
new Government. ]So one can examine the records of 
those days without being thoroughly impressed that the 
sense of the Convention was in favor of an absolute 
prohibition. Further proof may be found in the fact 
that from 1791 to 1812, a period of twenty-one years, 
the method of raising funds for the Government by 
the issue of bills of credit was not even suggested ; 
nor indeed were circulating notes, in form payable on 
demand without interest, issued at all, until more than 
seventy years after the adoption of the Constitution. 

The charter of the first Bank of the United States 
expired in 1811, and the Federalists were not strong 
enough to secure a recharter. When the war of 1812 


broke out, the necessity of funds was so imperative, 
that the Administration and Congress felt themselves 
forced, the one to recommend, and the other to author- 
ize, the issue of interest-bearing Treasury notes. They 
were regarded as a measure of necessity. Loans in the 
ordinary form had failed, and these notes were regarded 
as a convenient form of loan. They were not intended 
to circulate as money ; they were f undable into public 
stock, and, as a matter of fact, were retired as soon as 
possible after the close of the war. These issues were, 
however, a fatal precedent out of which has grown a 
latitude of constitutional construction not then antici- 

From 1815 to 1837, a period of twenty-two years, 
there was no resort to this remedy for the relief of 
the Government finances. In 1836, the charter of 
the second Bank of the United States expired, and 
again party spirit prevented a recharter. Soon after 
came the financial disasters of 1837, and again the Ad- 
ministration recommended, and Congress authorized, 
the issue of interest-bearing Treasury notes as forms of 
short loans. These issues extended from 1837 to 1844, 
and during that period the views of many, as to the 
constitutionality of their use, considerably expanded. 
The discussions in Congress, and the executive docu- 
ments of that day, show how severe was the strug- 
gle between the strict constructionists and those who 


were in favor of a view of the Constitution giving 

wider powers to Congress. 

During the Mexican war, 1846-1847, the plea of 
necessity secured congressional authority for another 
issue of interest-bearing Treasury notes. The financial 
panic of 1857 again caused Congress to consider such 
notes as the only remedy for the existing distress. 

It remained for the Civil war, however, to bring 
such pressure that all remaining constitutional scru- 
ples were swept away. Until 1862 no notes had 
been issued with the legal-tender quality. All propo- 
sitions to make Government paper a legal tender had 
been rejected almost with contempt by Congress. In 
1862, however, the first Legal-tender Act was passed, 
and for the first time, notes having the quality of legal 
tender, and intended to circulate as money, were is- 
sued by the United States Treasury. These notes 
were at first fundable in United States bonds, and had 
not this provision been afterward repealed by Con- 
gress, they would, like previous issues of Treasury 
notes, have soon disappeared from circulation. By this 
repeal they were made a permanent circulation. Then 
came the decision of the United States Supreme Court, 
reversing a former decision and making them a legal 
tender for all debts for those contracted before the 
passage of the Legal-tender Act as well as for those 
contracted after that date. This decision, however, 


based the constitutionality of legal-tender notes upon 
the war powers of Congress. This still left open the 
question whether such notes issued in time of peace 
were constitutional, and the Supreme Court has now 
settled that, under the Constitution, Congress has 
power, if it deems it expedient, to issue legal-tender 
money to any amount, either in time of peace or war. 

The chapter upon the distribution of the surplus 
money of the United States is, it is believed, the first 
complete history of that subject. It serves to illus- 
trate the subject of United States notes. The crisis of 
1837, which at that time was deemed sufficient cause 
for the issue of the latter, can be readily traced to the 
withdrawal of the surplus from the banks to distribute 
it among the States. 

The late decision of the Supreme Court on t!*<3 legal- 
tender question, and the dissenting opinion, OB account 
of their importance, are given in an Appendix. 

A considerable portion of the material in the present 
volume was contained in the third volume of the 
"Cyclopaedia of Political Science and Political Econ- 
omy," recently published by M. B. C*ry & Co., of 
Chicago ; and by their courtesy, and with their consent, 
it is given to the public in this convenient form. 

In addition to the authorities quoted, the following 
have been consulted: American State Papers; Annals 
of Congress ; Madison Papers ; Elliot's Debates ; Con- 

viii PREFACE. 

gressional Globe ; Bolles' Financial History of the 
United States; National Loans of the United States, 
by R. A. Bayley ; Annual Cyclopaedia ; Hunt's Mer- 
chants' Magazine ; Bankers' Magazine ; Schucker's Life 
of Chase ; Spaulding's Legal-tender Paper Money ; 
Newspapers, 1861, 1862, 1863. 

J. J. K. 

WASHINGTON, April 30, 1884. 










OP 1837 












INDEX, >231 


Photo-lithograph of Fifty Dollar one year Treasury Note, 
Act of March 3, 1843, bearing interest at the rate of 
one mill per $100 per annum. Frontispiece. 

Photo-lithograph of Fifty Dollar one year Treasury Note, 
Act of January 31, 1842, bearing interest at six per 
cent. Page 1 

Photo-lithograph of One Hundred Dollar two years Treas- 
ury Note, Act of January 28, 1847, bearing interest at 
six per cent. End of Volume. 

Form of One Hundred Dollar Note, Act February 24, 1815, 
bearing interest at 5| per cent., or one cent and one- 
half a cent per day. Page 35 

Form of Five Dollar Note, Act February 24, 1815, fund- 
able into seven per cent, bonds. Page 36 

Form of One Hundred Dollar one year Note, Act March 
31, 1840, bearing interest at five per cent. Page 47 

Form of One Hundred Dollar one year Note, Act July 22, 
1846, bearing interest at 5| per cent. Page 65 

Form of One Hundred Dollar two years Note, Act January 
28, 1847, bearing interest at six per cent. Page 67 


Form of One Hundred Dollar one year Note, Act Decem- 
ber 23, 1857, bearing interest at three per cent. 

Page 73 

Form of Fifty Dollar two years Note, Act March 2, 1861, 
bearing interest at six per cent. Page 81 

Form of Ten Dollar Note, being the first Demand Note 
ever issued by the United States, Act July 17, 1861. 

Page 91 

Form of Seven-thirty Fifty Dollar three years Note, in- 
terest one cent per day, Act March 3, 1865. Page 101 

Form of Five Cent Postage Currency and Reverse, re- 
ceivable for Postage Stamps, Act July 17, 1862. 

Page 105 

Form of Ten Cent Postage Currency and Eeverse, Act 
July 17, 1862. Page 106 

Form of Twenty-five Cent Postage Currency and Reverse, 
Act July 17, 1862. p age 107 

Form of Fifty Cent Postage Currency and Reverse, Act 
July 17, 1862. p age 108 

Form of Compound Interest three years Ten Dollar Note, 
bearing interest at six per cent., compounded semi- 
annually, Act June 30, 1864. Page 111 

Form of Reverse of Note, giving interest for each six 
months. Page 112 




PREVIOUS to the Revolutionary War paper money was 
issued to a greater or less extent by each one of the 
thirteen colonies. The first issue was by Massachusetts 
in 1690, to aid in fitting out the expedition against 
Canada. Similar issues had been made by New Hamp- 
shire, Rhode Island, Connecticut, New York, and New 
Jersey, previous to the year 1711. South Carolina 
began to emit bills in 1712, Pennsylvania in 1723,. 
Maryland in 1734, Delaware in 1739, Virginia in 1755,, 
and Georgia in 1760. Originally the issues were au- 
thorized to meet the necessities of the colonial treasuries. 
In Massachusetts, in 1715, as a remedy for the 
prevailing embarrassment of trade, a laud bank was 
proposed with the right to issue circulating notes se- 
cured by land. John Colman, a merchant of Boston, 
urgently advocated its establishment. The land bank 
was forbidden by the Province Council,, unless author- 
ized by the General Assembly. There was a large party, 


however, in favor of paper money in some form. The 
plan for the land bank was defeated, but the issue of 
paper money by the treasury was authorized to the ex- 
tent of 50,000, to be loaned on good mortgages in 
sums of not more than 500, nor less than 50, to one 
person. The rate of interest was 5 per cent., payable 
with one-fifth of the principal, annually. The bills 
were in form the same as those previously issued for 
the benefit of the treasury. This round sum or aggre- 
gate of 50,000, to be so loaned, was styled a bank, and 
was the first of the so-called loan banks, which were 
afterward authorized by nearly, if not quite, all of the 
colonies. In 1733 an issue of bills to the amount of 
110,000 was made by the merchants of Boston, which 
were to be redeemed at the end of ten years, in silver, 
at the rate of 19 shillings per ounce. In 1739, the com- 
mercial and financial embarrassment still continuing, 
another land bank was started in Massachusetts. John 
Colman was one of the corporators. The stock of the 
land bank was to be 150,000. Iso one was permitted 
to subscribe more than 2,000, nor less than 100. The 
subscribers were to pay down lawful money at the rate 
of 40 shillings for every 1,000 subscribed, and for the 
remainder were to pledge security in lands to the satis- 
faction of the directors. They were to pay 3 per cent, 
interest per annum, either in bills of the bank or in 
produce and manufactures, at prices regulated by the 
directors. Circulating notes equal to the capital were 
to be issued, payable in twenty years in produce or 
manufactures, and 5 per cent, of the capital was to be 
paid annually in the notes, produce, or articles manu- 
factured. The "manufactures, being the produce of 


this province," were enumerated as follows : ' " Hemp, 
flax, cordage, bar iron, cast iron, linens, sheep's wools, 
copper, tanned leather, flaxseed, beeswax, bayberry 
wax, sail cloth or canvas, nails, tallow, lumber or cord 
wood, or logwood from New Spain." This scheme 
was strenuously opposed by Governor Belcher, but in 
spite of all opposition 49,250 of its notes were struck 
off, of which the treasurer of the company issued 
35,582, and 4,067 were employed by the directors in 

A specie bank was also formed in 1739, by Edward 
Ilutcliinson and others, which issued bills to the amount 
120,000, redeemable in fifteen years in silver, at 20 shil- 
lings per ounce, or gold pro rata. The payment of these 
notes was guaranteed by wealthy and responsible mer- 
chants. These notes, and those of a similar issue in 1733, 
were largely hoarded and did not pass generally into 

In 1740 Parliament passed a bill to extend the act of 
1720, known as the bubble act, to the American colonies, 
with the intention of breaking up all companies formed 
for the purpose of issuing paper money. Under this 
act both the land bank and the specie bank were forced 
to liquidate their affairs, though not without some re- 
sistance on the part of the former. The Governors of 
Massachusetts rendered themselves very obnoxious to 
the people by their determined opposition to these banks 
and to paper money generally, 2 and Governor Belcher 

1 An Historical Account of Massachusetts Currency, p. 103. By 
Joseph B. Felt. Boston, 1839. 

- The History of Massachusetts Bay, vol. ii. , p. 396. By Lieutenant- 
Governor Hutchinson. Boston, 1767. 


\vas recalled to England on account of misrepresentations 
of the paper money advocates, but was subsequently ap- 
pointed Governor of Xew Jersey. 

The paper money of the colonies, whether issued by 
them or by the loan banks, depreciated almost without 
exception as the amounts in circulation increased. The 
bills as originally emitted were intended to be equal to 
coin, but when depreciation advanced to such an extent 
as to appal the authorities, a new set of bills would be 
issued, with new assurances that they would be kept 
equal to coin. In these new bills the old bills would be 
redeemable at their depreciated value. Sometimes this 
second set of bills, having also depreciated, was replaced 
by a third set in the same way. These various sets were 
designated tenors ; the terms old tenor, middle tenor, 
new tenor, new tenor 1st, new tenor 2d, being used to 
distinguish them. To give all the details of the depre- 
ciation of this currency in each of the colonies would re- 
quire much space ; but the best authorities agree that it 
underwent in all cases a constant diminution in value, 
inflicting loss and misery upon all classes of citizens. 
Pelatiah Webster says of this paper and the continental 
currency : " We have suffered more from this cause than 
from any other cause or calamity. It has killed more 
men, pervaded and corrupted .the choicest interests of 
our country more, and done more injustice than even the 
arms and artifices of our enemies." The following table 1 
gives the price of 100 in coin in the currencies of the 
several colonies in the year 1748 : 

1 A Short History of Paper Money and Banking in the United 
States, p. 10. By Wm. M. Gouge. Philadelphia, 1833. 


New England 1,100 

New York 190 

New Jersey 180 to 190 

Pennsylvania 180 

Maryland 200 

North Carolina 4 1,000 

South Carolina 750 

Virginia 120 to 125 

The emission of bills bj the colonies and the banks was 
not regarded with favor by the mother country, and the 
provincial governors were as a general thing opposed to 
these issues. They were consequently frequently em- 
broiled with their legislatures. Felt, in his " Massachu- 
setts Currency," gives examples of this controversy. 
Governor Belcher, in 1740, issued the following proclama- 
tion : " Whereas, a scheme for emitting bills or notes by 
John Colinan, Esq., and others, was laid before the General 
Court in their session held the 5th of December, 1739, 
and by a report of a committee appointed by said Court, 
was represented, if carried on, to have a great tendency 
to endamage His Majesty's good subjects as to their 
properties ; and whereas, application has been very 
lately made to me and His Majesty's Council, by a great 
number of men of the most considerable estates and 
business, praying that some proper method may be 
taken to prevent the inhabitants of this province being- 
imposed upon by the said scheme ; and it being very 
apparent that these bills or notes promise nothing of 
any determinate value, and cannot have any general, 
certain or established credit ; wherefore, I have thought 
fit, by and with the advice of His Majesty's Council, to 
issue this proclamation, hereby giving notice and warn- 


ing to all His Majesty's good subjects of the danger they 
are in, and cautioning them against receiving or passing 
the said notes, as tending to defraud men of their sub- 
stance and to disturb the peace and good order of the 
people, and to give great interruption and bring much 
confusion into their trade and business." 

Subsequently, on November 6, of the same year, being 
assured that part of the military corps encouraged the 
circulation of the land bank paper, he published the fol- 
lowing : " I hereby warn all commissioned officers in the 
;nilitia from signing or giving any countenance to the 
passing of the said notes of hand, directly or indirectly. 
And as I apprehend that if these should obtain a cur- 
rency, it will reflect great dishonor on His Majesty's Gov- 
ernment here, and be very detrimental to the public in- 
terests of this province and people, I do hereby declare 
niv firm resolution, that if after this pnblick notice given, 
any of the military officers of this province persist in 
being any way concerned in or giving any encouragement 
whatsoever to the passing of the said notes of hand, and 
full proof be made thereof to my satisfaction, I will im- 
mediately dismiss them from their said offices." These 
proclamations had but little effect. A gentleman writing 
to a correspondent in London, under date of February 
"27, 1741, says: " Whole troops, nay almost whole regi- 
ments either resigned or told their colonels, who ex- 
amined them, that they would resign rather than not 
encourage the 1 bills." Later in the same year Governor 
Belcher writes to Thomas Hutchinson : " You say it 
would be much better if some other way than by appli- 
cation to Parliament could be found to suppress it (land 
bank). I assure you, the concerned openly declare they 


defy any act of Parliament to be able to do it. They 
are grown so brassy and hardy as to be now combining 
in a body to raise a rebellion, and the day set for their 
coming to this town is at the election, and their treas- 
urer, I am told, is in the bottom of the design, and I 
doubt it not. I have this day sent the sheriff and his 
officers to apprehend some of the heads of the conspir- 

These continued disputes, which largely curtailed the 
use of an expedient which the colonists considered 
necessary to their prosperity, together with the action 
of Parliament in restricting the issue of paper money, 
embittered the minds of the colonists against England, 
and had undoubtedly much to do with the final out- 
break. The Bubble Act, which laid an interdict on all 
banking associations having no legal charter within the 
dominions of the king, was passed by Parliament in 
1720. In 1740 another enactment was made, extending 
the provisions of the act of 1720 to the American colo- 
nies, where it had been disregarded. Banking in those 
days consisted merely in the privilege of issuing circu- 
lating notes, and this act restricted all private enter- 
prises of this kind. On June 25, 1751, Parliament 
enacted a law forbidding paper money of the colonies 
to be passed, except for current expenses of the Govern- 
ment each year, or in case of invasion by the enemy. 
It seems also that these exceptional cases, where paper 
money was permitted, were to be under control of the 
Crown, as Mr. Bollan, the agent in London of the prov- 
ince of Massachusetts, writes that he opposed the bill 
on the ground that it might open the way for the un- 
constitutional exercise of the king's authority in the 


colonies in other matters. Legal tender paper money 
was prohibited by this act of Parliament, and in 1763 
such issues were declared void ; but subsequently, in 
1773, they were allowed to be received as legal tender 
at the treasuries of the several colonies. 



THE second Continental Congress was convened in 1775, 
and, in order to raise funds, having no power to insti- 
tute taxation, naturally turned toward the expedient of 
an emission of paper money on the credit of the Union, 
but in the redemption of which each colony was to bear 
a part. The first issue was made in June, 1775. For 
a year these issues continued equal to gold ; in two 
years they had depreciated to 2 for 1 ; in three years to 
4 for 1 ; in nine months more their relative value was 
10 for 1 ; in September, 1779, it was 20 for 1. Con- 
gress now determined that the total issues should not 
exceed $200,000,000, and renewed the declaration that 
this currency should be redeemed in full, and went to 
some labor to prove that the States had the ability to do 
so. In March, 1780, these issues had so depreciated 
that their value, as compared with specie, was as 40 to 1. 
Congress now required the whole to be brought in for 
redemption at its market value in coin, and also author- 
ized the emission of new notes bearing interest at 5 per 
cent., and payable six years from date in silver and gold. 
These were to be exchanged in the proportion of 1 
dollar of the new for 20 dollars of the old emission. 


During the year 1780 the notes of the old issue sank 
first to 75 to 1, then ceased to circulate in the States 
north of the Potomac. In Virginia and North Carolina 
they passed for a year longer, and finally depreciated to 
1,000 to 1, and then ceased to circulate. 

According to Thomas Jefferson, but 200 millions of 
the first emission was issued, which was the amount au- 
thorized by resolution of Congress ; but other authorities 
state the amount much higher. Joseph bourse, register 
of the treasury in 1828, places it at $241,552,780. The 
amount as given in the treasury statement of 1843 was 
8242,100,176. The aggregate loss to the people of the 
country from this currency was estimated by Secretary 
Woodbury at $196,000,000. During the war paper 
money, distinct from the continental currency, was also 
issued by several of the States. The amount thus issued 
has been placed at $209,000,000, which is probably too 
high. It is, however, difficult to obtain exact informa- 
tion in reference to these emissions. 

At the close of the war the minds of all classes were 
imbued with a wholesome antipathy to paper money, and 
as a consequence, when the Federal Constitution was un- 
der consideration, the power to emit bills, which in the 
original draft was given to the United States, was strick- 
en out. Moreover, the original draft having contained 
a qualified permission to the States to issue paper money, 
an amendment was inserted which took away from the 
States all power to coin money, emit bills of credit, or 
make anything but gold or silver coin a tender in pay- 
. ment of debts. It has been held that the lack of power 
on the part of a State to coin money, taken in connection 
with the prohibition of the emission of bills, prevents the 


issue of paper money by banks chartered by the State, as 
well as such issue by the State itself. This view was held 
by Daniel Webster, in his speech on the Bank of the 
United States, on the 25th and 28th of May, 1832, and 
his arguments are quoted with commendation by Mr. 
Justice Story, in his commentaries on the Constitution, 
as follows : " It will be hereafter seen that this (the 
power to coin money) is an exclusive power in Congress, 
the States being expressly prohibited from coining money. 
And it has been said by an eminent statesman that it 
is difficult to maintain, on the face of the Constitution it- 
self, and independent of long-continued practice, the doc- 
trine that the States, not being at liberty to coin money, 
can authorize the circulation of bank paper as currency 
at all. His reasoning deserves grave consideration, and 
is to the following effect : The States cannot coin money. 
Can they, then, coin that which becomes the actual and 
almost universal substitute for money ? Is not the right 
of issuing paper intended for circulation in the place and 
as the representative of metallic currency, derived merely 
from the power of coining and regulating the metallic 
currency ? Could Congress, if it did not possess the power 
of coining money and regulating the value of foreign 
coins, create a bank with the power to circulate bills ? It 
would be difficult to make it out. Where, then, do the 
States, to whom all control over the metallic currency is 
altogether prohibited, obtain this power ? It is true that 
in other countries private bankers, having no legal author- 
ity over the coin, issue notes for circulation. But this they 
do always with the consent of the Government, express or 
implied ; and Government restrains and regulates all their 
operations at its pleasure. It would be a startling propo- 


sition in any other part of the world, that the prerogative 
of coining money held by the Government was liable to 
be defeated, counteracted, or impeded by another pre- 
rogative, held in other hands, of authorizing a paper cir- 
culation. It is further to be observed that the States 
cannot issue bills of credit ; not that they cannot make 
them a legal tender, but that they cannot issue them at 
all. This is a clear indication of the intent of the Con- 
stitution to restrain the States as well from establish- 
ing a paper circulation as from interfering with the 
metallic circulation. Banks have been created by States 
with no capital whatever, their notes being put in circu- 
lation simply on the credit of the State. "What are the 
issues of such banks but bills of credit issued by the 
State ? " Mr. Justice Story says : " This opinion was 
not peculiar to Mr. Webster ; it was maintained also by 
Hon. Samuel Dexter, one of the ablest statesmen and 
lawyers who have adorned the annals of the country." 

Nearly thirty years after, Chief Justice Chase, when 
Secretary of the Treasury, in his report to Congress, of 
December 9, 1861, said : " It has well been questioned 
by the most eminent statesmen, whether a currency of 
bank notes, issued by local institutions under State laws, 
is not, in fact, prohibited by the national Constitution. 
Such emissions certainly fall within the spirit, if not 
within the letter, of the constitutional prohibition of the 
emission of bills of credit by the States, and of the mak- 
ing by them of anything except gold and silver coin, a 
legal tender in payment of debts." 



THE committee appointed by the Federal Convention held 
in Philadelphia on May 14, 1787, reported, on August 
6, a draft of the Constitution, which contained, in article 
thirteen, a clause giving qualified authority to the States 
to issue paper money, as follows : " Is o State without 
the consent of the Legislature of the United States shall 
emit bills of credit, or make anything but specie a ten- 
der in payment of debt." This clause, after discussion, 
was finally so amended as to read as follows : " Xo State 
shall coin money, emit bills of credit, make anything 
but gold and silver coin a tender in payment of debts." 
The eighth clause of the first section of the seventh 
article of the Constitution, as presented for the consid- 
eration of the Convention, provided that " the Legislature 
of the United States shall have power to borrow money, 
and emit bills on the credit of the United States." This 
clause, as embodied in the eighth section of the first 
article of the Constitution as finally adopted, reads, 
" The Congress shall have power to borrow money on 
the credit of the United States." The debate ' on 
the question of striking out the words " and emit bills," 
is important, for the reason that the subject of making 

1 Madison papers, vol. iii., p. 1343. 


bills of credit issued by the Government a legal tender, 
was there for the first time discussed, and was not sub- 
sequently at any time, as far as I am aware, discussed at 
any length by Congress, though it was twice presented 
for its consideration, until the Legal Tender acts of 1862 
were brought before Congress for its consideration. 
This debate was as follows : 

" Mr. Gouverneur Morris moved to strike out, ' and 
emit bills on the credit of the United States.' If the 
United States had credit, such bills would be unneces- 
sary ; if they had not, unjust and useless. Mr. Butler 
seconds the motion. Mr. Madison: Will it not be suffi- 
cient to prohibit the making them a tender ? This will 
remove the temptation to emit them with unjust views. 
And promissory notes, in that shape, may in some emer- 
gencies be best. Mr. Gouverneur Morris : Striking 
out the words will leave room still for notes of a re- 
sponsible minister, which will do all the good without the 
mischief. The moneyed interest will oppose the plan of 
Government, if paper emission be not prohibited. 

"Mr. Gorham was for striking out without inserting 
any prohibition. If the words stand, they may suggest 
and lead to the measure. Mr. Mason had doubts on the 
subject. Congress, he thought, would not have the 
power, unless it were expressed. Though he had a mor- 
tal hatred to paper money, yet as he could not foresee 
all emergencies, he was unwilling to tie the hands of the 
Legislature. He observed that the late w^ar could not 
have been carried on, had such a pohibition existed. 
Mr. Gorham : The power, as far as it will be necessary 
or safe, is involved in that of borrowing. 

" Mr. Mercer was a friend to paper money, though 


in the present state and temper of America, he should 
neither propose nor approve of such a measure, lie 
was consequently opposed to a prohibition of it alto- 
gether. It will stamp suspicion on the Government, to 
deny it a discretion on this point. It was impolitic, 
also, to excite the opposition of all those who were 
friends to paper money. The people of property 
would be sure to be on the side of the plan, and it was 
impolitic to purchase their further attachment with 
the loss of the opposite class of citizens. Mr. Ellsworth 
thought this a favorable moment to shut and bar the 
door against paper money. The mischiefs of the vari- 
ous experiments which had been made were now fresh 
in the public mind, and had excited the disgust of all 
the respectable part of America. By withholding the 
power from the new Government, more friends of influ- 
ence would be gained to it than by almost anything else. 
Paper money can in no case be necessary. Give the 
Government credit, and other resources will offer. The 
power may do harm, never good. Mr. Randolph, not- 
withstanding his antipathy to paper money, could not 
agree to strike out the words, as he could not foresee all 
the occasions that might arise. 

" Mr. Wilson : It will have a most salutary influence 
on the credit of the United States to remove the possi- 
bility of paper money. This expedient can never suc- 
ceed while its mischiefs are remembered. And as long 
as it can be resorted to, it will be a bar to other resources. 
Mr. Butler remarked that paper was a legal tender in 
no country in Europe. He was urgent for disarming 
the Government of such a power. Mr. Mason was still 
averse to tying the hands of the Legislature altogether. 


If there was no example in Europe, as just remarked, it 
might be observed, on the other side, that there was 
none in which the Government was restrained on this 
head. Mr. Eead thought the words, if riot struck out, 
would be as alarming as the mark of the beast in Keve- 
lation. Mr. Langdon had rather reject the whole plan 
than retain the three words, 'and emit bills.' 

" On the motion for striking out, Kew Hampshire, 
Massachusetts, Connecticut, Pennsylvania, Delaware, 
Virginia, Xorth Carolina, South Carolina, Georgia, aye 
9 ; jSew Jersey, Maryland, no 2. The clause for 
borrowing money was agreed to, nem. con. Adjourned," 

Kine States voted to strike out, and two States to re- 
tain. Virginia voted in the affirmative, and in explana- 
tion of his vote, Mr. Madison appended the following 
note : " This vote in the affirmative by Virginia was oc- 
casioned by the acquiescence of Mr. Madison, who be- 
came satisfied that striking out the words would not 
disable the Government from the use of public notes as 
far as they could be safe and proper, and would only 
cut off the pretext for & paper currency, and particularly 
for making the bills a tender either for public or private 

Mr. Martin, of Maryland, a delegate to the Federal 
Convention, who was in favor of retaining the words, in 
his address to the Legislature of his own State, soon 
after the proceedings of the Convention, said: 1 "By 

1 "The Genuine Information delivered to the Legislature of Mary- 
land, relative to the Proceedings of the General Convention lately 
held at Philadelphia, by Luther Martin, Esq., Attorney General of 
Maryland, and one of the Delegates in the said Convention. Phil- 
adelphia: printed by Eleazer Oswald, at the Coffee House. 1788." 


our original articles of confederation, the Congress 
have a power to borrow money and emit bills of 
credit on the credit of the United States ; agreeable 
to which was the report on this system as made by the 
Committee of Detail. When we came to this part of the 
report, a motion was made to strike out the words, ' to 
emit bills of credit ; ' against the motion we urged that 
it would be improper to deprive the Congress of that 
power ; that it would be a novelty unprecedented to es- 
tablish a government which should not have such au- 
thority. That it was impossible to look forward into 
futurity so far as to decide that events might not hap- 
pen that should render the exercise of such a power ab- 
solutely necessary. And that we doubted whether, if a 
war should take place, it would be possible for this coun- 
try to defend itself without having recourse to paper 
credit, in which case there would be a necessity of be- 
coming a prey to our enemies, or violating the Constitu- 
tion of our Government ; and that, considering the ad- 
ministration of the government would be principally in 
the hands of the wealthy, there could be little reason to 
fear an abuse of the power by an unnecessary or injuri- 
ous exercise of it. But, sir, a majority of the Conven- 
tion, being wise beyond every event, and being willing 
to risque any political evil rather than admit the idea 
of a paper emission, in any possible case, refused to 
trust this authority to. a Government to which they were 
lavishing the most unlimited powers of taxation, and to 
the mercy of which they were willing blindly to trust 
the liberty and property of the citizens of every State 
in the Union ; and they erased that clause from the sys- 


Forty-eight years later, in a speech in the Senate on the 
famous "specie circular" in 1836, Daniel Webster said : 
" Most unquestionably there is no legal tender, and 
there can be no legal tender in this country, under the 
authority of this Government or any other, but gold and 
silver, either the coinage of our own mints or foreign 
coins at rates regulated by Congress. This is a Constitu- 
tional principle, perfectly plain and of the highest im- 
portance. The States are expressly prohibited from 
making anything but gold and silver a legal tender in 
payment of debts, and although no such express pro- 
hibition is applied to Congress, yet, as Congress has no 
power granted to it in this respect but to coin money 
and to regulate the value of foreign coins, it clearly has 
no power to substitute paper or anything else for coin 
as a tender in payment of debts and in discharge of 
contracts. Congress has exercised this power fully in 
both its branches ; it has coined money, and still coins 
it ; it has regulated the value of foreign coins, and still 
regulates their value. The legal tender, therefore, the 
constitutional standard of value, is established and can- 
not be overthrown. To overthrow it would shake the 



THE Constitution was adopted on September 17, 1787, 
and three years thereafter, Hamilton, in his report of 
December 13, 1790, on a national bank, said : " The 
emitting of paper money by the authority of Government 
is wisely prohibited to the individual States by the 
national constitution ; and the spirit of that prohibition 
ought not to be disregarded by the Government of the 
United States. Though paper emissions, under a gen- 
eral authority, might have some advantages not applica- 
ble, and be free from some disadvantages which are ap- 
plicable, to the like emissions by the States separately, yet 
they are of a nature so liable to abuse and, it may even 
be affirmed, so certain of being abused that the wis- 
dom of the Government will be shown in never trusting 
itself with the use of so seducing and dangerous an ex- 
pedient." Although notes of different forms were issued 
subsequently by the Government at various dates, some 
of \vhich were receivable for all dues payable to the 
Government, no circulating notes were authorized to be 
issued which were payable on demand in coin, until the 
passage of the act of July 17, 1861, which authorized 
the issue of fifty millions of notes payable " on demand " 
and "receivable in payment of all public dues;" and no 
circulating notes were authorized, which by the terms of 
law were made a full legal tender, until the passage of 
the act of February 25, 1862, which was nearly seventy- 
five years after the adoption of the Constitution. Some 


of the treasury notes, issued since the adoption of the 
Constitution, and previous to the passage of the Legal 
Tender act, were receivable for all dues to the Govern- 
ment, and others not ; some were payable at a fixed date, 
both with and without interest ; some were fundable at 
any time after the date of their issue, others at a fixed 
date in United States bonds. 

During the late civil war, treasury notes were also is- 
sued of all these different forms, and also notes payable 
on demand, receivable for all dues to the Government, 
and others payable to bearer, not receivable for duties on 
imports, or payable by the Government for interest upon 
the public debt, but in every other respect a full legal 
tender to and by the Government, and between the people 
in all payments. Postage currency was also issued, re- 
ceivable in payment of all dues less than five dollars ; and 
fractional currency, which was "exchangeable for United 
States notes " in sums of not less than three dollars. 

Ko notes were issued from 1789 to 1812, a period 
of twenty-three years. !N\)tes bearing interest were 
issued in the years 1812, 1813, 1814" and 1815, and at 
various dates from 183T to 1847. They were again 
issued in 1857, and subsequently, in the years 1860, 1861 
and thereafter. The periods for the issue of these notes 
may be summarized as follows : first, the war of 1812 ; 
second, the financial crisis of 1837 ; third, the Mexican 
war; fourth, the financial crisis of 1857, or during 
the Buchanan administration ; and fifth, the war of 
the rebellion. It will thus be seen that there have 
been four emergencies in which Congress lias seen fit 
to authorize interest-bearing notes, and only one in which 
it has authorized bills of credit or circulating notes paya- 
ble on demand in lawful money. 



THE original debt had, at the beginning of 1812, been 
reduced from seventy -five millions to forty-five millions. 
In 1810 it was found impossible to meet all of the annual 
reduction of the debt required by law from the sinking 
fund, and a temporary loan was authorized to make up 
the deficiency, which amounted to $2,750,000. This 
loan was paid the next year. In 1811, however, re- 
course was had to a loan, and the one authorized by 
Congress for that year was taken so slowly, that, in the 
month of May of the following year the Secretary of 
the Treasury, for the first time since the adoption of the 
Constitution, recommended the issue of treasury notes 
upon the following principle, viz. : "1. Not to exceed, 
in the whole, the amount which may ultimately not be 
subscribed to the loan ; that is to say, that the amount 
received on account of the loan, and that of the treasury 
notes, shall not, together, exceed eleven millions ; which 
limits, therefore, the greatest possible amount of treasury 
notes to less than $4,900,000. 2. To bear an interest of 
5| per cent, a year, equal to one cent and one-half a cent 
per day on a hundred dollar note. 3. To become pay- 
able by the treasury one year after the date of their re- 
spective issues. 4. To be, in the meanwhile, receivable in 


payment of all duties, taxes, or debts, due to the United 
States." He did not propose that the notes should be 
fundable in the loan which they were intended to re- 
enforce. This recommendation of Secretary Gallatin 
was made in his letter of May 14, 1812, to Mr. Langdon 
Cheves, chairman of the Committee of Ways and Means 
of the House, and, in conformity therewith, a bill was 
reported by that Committee on June 12, 1812. 

War was declared against Great Britain June 18, 1812. 
The failure of the loan was due to the fact that the 
money had to be borrowed from the very classes who 
had been opposed to the war ; therefore, when the bill 
for authorizing treasury notes was put upon its passage 
an June 16, it met with much opposition. It was 
argued that the notes under the bill were not equal in 
value to gold and silver, and would not be received by 
the banks or the people, who were prejudiced against 
such Government paper ; that if issued they could not be 
redeemed, and would depreciate ; that the measure 
would be subversive of public and private credit ; that 
it was a confession of impaired credit ; that to allow 
the notes to be deposited in banks and to accept bank 
paper in exchange was to depreciate the Government's 
paper ; that if issued, additional taxes should be im- 
posed and set apart for the redemption of the notes, as 
in the case of the English exchequer notes ; that the pro- 
posed notes were the same as the old continental money, 
and would depreciate in the same way. 

Others opposed the bill simply because they opposed 
the war or any preparation for it. In case Avar proved 
unavoidable the necessary funds should be raised by 
taxes and loans. The shortness of the time for which 


the notes were to be issued was another objection. 
The public revenues would not meet the engagement, 
and engagements should not be entered into without a 
certainty of fulfilment. Taxes were necessary. It was 
a paltry expedient never suggested by Hamilton or 
Wolcott, and not even the spontaneous production of 
Gallatin ; that the first suggestion of the latter was to 
authorize a loan on such terms as would have insured 
its success. It Avas a humiliating spectacle to exhibit the 
Government failing in negotiating its first war loan. 

On the other hand, the supporters of the bill main- 
tained that the notes would be received by the banks in 
the same manner as any good individual paper was re- 
ceived. The banks would give the Government credit 
for them, and in return the Government could draw gold 
and silver from the banks. The notes would be even 
more valuable to the latter than specie, as they could be 
kept as an interest-bearing reserve. They would have 
currency, being receivable in duties, taxes, and debts due 
the Government, and, as interest accumulated, they 
would increase in value. In reply to the suggestions 
that money should be raised by taxes, it was stated that 
when, previously, measures of that kind had been pro- 
posed, the opposition had refused to consent. The 
issue of treasury notes, bearing interest at 5f per cent, 
only, did not indicate bad, but rather good credit. In- 
dividuals in good credit could not borrow at less than 6 
per cent. There was no depreciation of Government 
paper in exchanging the notes for bank paper, as the 
latter was ready money, while the former were payable 
one year after date. It was denied that the people had 
or would have any prejudice against treasury notes. 


They were, not prejudiced against bank notes, and the 
proposed notes bearing interest had many advantages 
over bank paper. The proposed notes would be in no 
way inferior to exchequer bills; in fact, it was only 
want of credit that compelled the English Government 
to set aside certain revenues to meet the latter. The 
treasury notes would have two advantages over ex- 
chequer bills : one, the superior credit of the United 
States, and the other, that they were receivable for 
taxes and public dues. They were also superior to pub- 
lic stocks, in that, while bearing interest, they also can 
serve as currency, the same as gold and silver, thus en- 
hancing the medium of circulation. There was no re- 
semblance between them and continental money. 
When the latter was issued, the Government was de- 
pendent on the pledges of the several States for its 
revenues, but now its credit was above suspicion, its 
power to raise revenue complete, and its ability to pay 
its debts undoubted. War was unavoidable. Both 
loans and taxes would have to be resorted to. The pro- 
posed notes were nothing but a loan with extraordinary 
advantages, taking, however, but little from the circulat- 
ing medium of the country. In many transactions they 
would have all the effect of money. While not secured 
by any specific fund set apart for their redemption, the 
entire duties and taxes of the year are indirectly pledged 
for this purpose, since they are receivable in payment 
of such duties and taxes. The revenues of the year 
were estimated at eight millions, and the proposed issue 
of notes was five millions only. The faith of the Gov- 
ernment was pledged for their redemption. That faith 
had never been violated. The resources of the Govern- 


merit were ample beyond those of any other nation. 
Its sources of revenue were unimproved land, a produc- 
tive agriculture, an extensive commerce, an enterprising 
people, and an unlimited right of taxation. The antici- 
pated abuse of a privilege was no argument against its 
legitimate use. 

The bill passed the House June 17, 1812, yeas 85, 
nays 41. It passed the Senate June 26, and became a 
law June 30, 1812. By it the President was authorized 
to issue treasury notes to an amount not exceeding 
$5,000,000. Section two of the first " Act to authorize 
the issuing of treasury notes," read as follows : ' ; That 
the said treasury notes shall be reimbursed by the 
United States, at such places, respectively, as may be 
expressed on the face of the said notes, one year, re- 
spectively, after the day on which the same shall have 
been issued ; from which day of issue they shall bear 
interest at the rate of five and two-fifths per centum a 
year, payable to the owner and owners of such notes, at 
the treasury, or by the proper commissioner of loans, at 
the places and times respectively designated on the face 
of said notes for the payment of principal." 

They were signed by persons designated by the Presi- 
dent, and the compensation of these persons was fixed 
at one dollar and twenty-five cents each for one hundred 
notes signed. They were countersigned by the Com- 
missioners of Loans for the State in which the notes were 
respectively made payable. With the approval of the 
President, the Secretary of the Treasury was authorized 
to borrow money upon the security of the notes, and to 
pay them to such banks as would give the Government 
credit for them at par. When the notes were paid to 


collectors of revenue and receivers of public money, the 
interest ceased on the day of payment. The Commis- 
sioners of the Sinking Fund were authorized to cause 
the principal and interest to be paid when due, and to 
purchase them at not more than par, in the same M T ay 
as they purchased other public securities, with a view of 
reducing the debt. They were made payable to order, 
transferable by delivery and assignment on indorsement 
by persons to whose order they were made payable. 
The notes were made everywhere receivable for duties, 
taxes, and in payment of public land, at their par value 
with accrued interest on the day paid in. Penalties 
were imposed for counterfeiting them, and an appro- 
priation made for the expense of printing and preparing 
the notes. 

There was nothing in the law regulating the denomi- 
nations in which they should be issued, but, as a matter 
of fact, none were issued of a denomination of less than 
one hundred dollars. The largest amount authorized 
under this act, outstanding at any one time, M r as five 
millions. The notes authorized were all issued before 
the end of the year 1813, and were all redeemed during 
the year 1814. Mies' Register for July 4, 1812, in an 
editorial, thus refers to the issue of these notes. The 
arguments used in favor of their issue were almost pre- 
cisely the same as those afterward urged by Chase and 
Fessenden in favor of the issue of seven-thirty and com- 
pound-interest notes : 

"To meet any possible exigency from a transient 
failure of adequate supplies to carry on the war against 
an unprincipled and inveterate enemy, it has been re- 
solved to issue certain notes from the treasury depart- 


ment, to the amount of about five million dollars, bear- 
ing interest of five and two-fifths per cent, per annum, 
equal to one and one-half cents per day on every note 
of $100 which notes are to become payable at the 
treasury one year after the date of their respective 
issues, and in the meantime are receivable (with interest 
that may have accumulated upon them) in all payments 
to be made to the United States. 

" This plan appears the most eligible that could possi- 
bly have been adopted, as it will mutually accommodate 
the Government and the people, and be advantageous 
to both. Yet attempts are making (what will not the 
enemy attempt ?) to depreciate the value of this intended 
emission, by comparing it with the old continental 
money.- The pitiful design will not avail, for though 
treasury notes to the value of five millions may issue, 
the probability is that a ten thousandth part of the 
population of the United States will never see one of 
them. The whole will be locked in the vaults of the 
bank, or snugly put away by individuals as soon as they 
appear; because they will be convertible into current 
money (specie or bank notes) at a moment's notice, and 
have constantly increasing value. The sum to be issued 
is so completely within the means of the Government, 
that these notes will always bear a premium equal to 
the interest that may have accumulated on them. The 
city of New York itself, in the course of one year 
would consume the whole emission. The proposed op- 
eration of these notes is so perfectly understood by the 
trading part of the community, particularly on the sea- 
board, that an explanation of it may W 7 ell be thought 
superfluous ; but as bad men may seize upon them to 


alarm the ignorant and unsuspecting, it appears right 
we should offer a few propositions to show their folly 
and wickedness. A person receives of the United 
States $10,000 in treasury notes ; if he has no use for 
the money for ten days, he lays them in his desk for 
that time the interest in the interim amounts to $15. 
He then carries them to a bank and deposits them with 
other monies, for $10,015, or exchanges them with a 
friend or neighbor (and in our seaports he can always 
find such) who has duties to pay for that amount. Thus 
the money is never idle, it works night and day, in the 
language of money lenders, and is constantly accumu- 
lating. The banks will be glad to receive these notes 
in exchange for their own ; the advantage is on their 
side, as the treasury notes bear a daily interest, and their 
own bear none at all. If the stock should rise to a 
greater amount than the bank may think it advisable to 
keep, w T liich can hardly be possible, they are immedi- 
ately convertible into any kind of money desired, for 
the banks always have customers who will use them in 
payment of bonds due the United States for duties. 
They are better as deposits than specie, gold, and silver, 
for gold and silver lie dormant in the vaults, whereas 
the treasury notes will be an active capital, every hour 
becoming more and more valuable, and as fully compe- 
tent to all the purposes of the banks as specie, because 
they will produce it. 

" From these brief remarks it will appear evident that 
treasury notes, the moment they are issued, will be 
hoarded up by the banks, if they can get them ; and 
very few of us will be alarmed at the sight of one unless 
we seek it as a matter of curiosity." 


The Secretary estimated that there would be a deficit 
of nineteen millions for the year 1813. Congress au- 
thorized sixteen millions of this amount to be obtained 
by loans, without tlie usual provision that the bonds 
should be sold at par, or specifying the rate of interest. 
The loan was placed with great difficulty, the sixteen 
millions authorized being obtained from the avails of 
$18,109,377.43 of stock, bearing interest at six per cent. 

To supply the remainder, a bill was introduced into 
the House on January 27, 1813, to authorize a new issue 
of treasury notes. The bill was similar in its provisions 
to the act of 1812 ; the arguments for and against the 
measure were in the main the same as those of 1812. 
The opposition complained that much favoritism had 
been shown in the dealings with the banks. It was al- 
leged that among the banks granting credit in return 
for the treasury notes deposited, as authorized by the 
law of 1812, were those acting as depositaries of public 
moneys derived from the ; deposits of collectors and pub- 
lic agents ; that this very money so deposited by the 
Government agents was again loaned to the Government 
on the credit of treasury notes. On the other hand, it 
was urged that the use of banks as depositaries was un- 
avoidable, and that, in any event, banks would receive 
incidental benefit from keeping Government deposits. 
Even if a stock loan was substituted for treasury notes 
the money realized therefrom would be deposited with 
the same banks until required by the Government. The 
bill passed the House by a vote of 79 to 41, and the Sen- 
ate by a vote of 17 to 9, and became a law on February 25, 
1813. The greatest amount of notes authorized by this 
act, outstanding at anyone time, was five millions; they 


were all redeemable by the first quarter of the calendar 
year of 1815, but at the close of that quarter only 
$1,483,900 had been redeemed, and all of the remainder 
was not finally paid until the year 1820, although the 
greatest portion was called in by 1817. They were is- 
sued in denominations of not less than $100. 

An act similar in all respects to that of February 25, 

1813, passed the House by vote of 83 to 48, and the Senate 
without debate, on March 1, and was approved March 4, 

1814. It authorized the issue of five millions of treasury 
notes, and of an additional five millions, which, if issued, 
was to be considered as part of a stock loan for the year, 
which was subsequently to be authorized. This loan for 
twenty -five millions was authorized on March 24th of the 
same year, and could only be placed at a large discount. 
An additional five millions was therefore issued in place 
of an equal amount of stock, making in all ten millions 
of treasury notes issued under this act. These notes 
were for the first time issued^ in denominations of less 
than 8100, notes of the denomination of twenty dollars 
being placed in circulation. The whole ten millions 
were issued previous to June 30, 1815. The policy of 
Congress seemed to be to keep the authorized issue of 
treasury notes each year below the amount of the reve- 
nue of the year, or, if more was authorized, they were to 
be in lieu of, and to re-enforce, stock loans. 

On December 26, 1814, an act was passed which 
authorized the issue of $7,500,000 of treasury notes in 
place of portions of the loans of March 24th and Novem- 
ber 15th not already placed, and three millions more for 
the expenses of the War Department. These notes bore 
.the same rate .of interest and were for the same time as 


those of the act of June 30, 1812, and under this act 
$8,318,400 of notes were issued, a portion of which was 
in the denominations of twenties and fifties. 

On August 31, 1814, specie payments were suspended 
except in lS T ew England. The accounts of the Treasury 
Department show that there were outstanding on Sep- 
tember 30, 1814, $10,649,800 of treasury notes. Mr. 
Crawford was succeeded in October by Secretary Dallas, 
and the latter, in his report to the Committee of Ways 
and Means on October 17, 1814, said the condition of the 
circulating medium presented another copious source of 
mischief and embarrassment. The stock of specie was 
diminished by exportation, and by its withdrawal into 
the private coffers of individuals. The multiplication of 
banks had increased the paper currency, so that it was 
difficult to calculate its amount, and still more difficult 
to ascertain its value. Bank currency was of no benefit 
since the suspension of specie payments, and there virtu- 
ally existed no circulating medium common to all the 
citizens of the United States. The money transactions 
of private individuals were at a stand, and the fiscal opera- 
tions of the Government labored with extreme inconven- 
ience. Under favorable circumstances, the limited issue 
of treasury notes would probably afford relief, but they 
were an expensive and precarious substitute for coin or 
bank notes. He concluded by recommending the estab- 
lishment of a national bank, and added : " But whether 
the issues of paper currency proceed from the national 
treasury, or from a national bank, the acceptance of the 
paper in a course of payments and receipts must be for- 
ever optional with the citizens. The extremity of that 
day cannot be anticipated, when any honest and enlight- 


ened statesman will again venture upon the desperate 
expedient of a tender law." This statement was called 
out by a report made by Mr. Eppes, Chairman of the 
Committee of Ways arid Means of the House, on Octo- 
ber 10, 1814, in which, in order to secure the circulation 
of treasury notes, it was recommended that notes of small 
denominations should be issued, to be funded into 8 per 
cent, stock, payable to bearer, and transferred by deliv- 
ery, receivable in all payments for public lands and taxes. 
The internal revenue taxes were to be pledged for pay- 
ment of interest, and they were to be exchangeable for 
stock at 8 per cent., or redeemable in specie after six 
months' notice from the Government. 

On November 24, 1814, in a report to the committee 
to which a bill for establishing a national bank had 
been referred, Mr. Dallas mentions, as one of the means 
at the disposal of the Treasury, the issue of treasury 
notes, " which none but necessitous creditors, contractors 
in distress, or Government agents acting officially were 
willing to accept." He also states that the act of Ko- 
vember 15, 1814, authorizing treasury notes to be taken 
in payment for subscriptions to loans, was passed too 
late ; that the interest on the public debt had not been 
punctually paid, and that a large amount of treasury 
notes had already been dishonored. In a subsequent 
communication of December 14, 1814, he said that the 
non-payment of treasury notes, and the risk of not pay- 
ing the interest on the funded debt, were chiefly owing 
to the suspension of specie payments by the banks, and 
the consequent impracticability of transferring public 
funds from the place where they were deposited to the 
place where they were needed. The difficulty referred to 


in meeting tlie interest upon the public debt was in Bos- 
ton. A State bank had large Government deposits, and a 
draft was sent to meet the interest, upon October 1, 1814. 
The State bank declined paying in coin or bank notes, 
and the creditors refused to receive the treasury notes 
that were offered instead. After the suspension, the 
Government was deprived of the use of specie, and as 
the banks in each State refused credit and circulation to 
the notes of banks' in other States, no transfer of funds 
could be made to places where they were wanted to 
meet treasury notes ; consequently the credit of these 
notes was lessened, and creditors refused to accept them 
in payment. 

On November 12, 1814, Mr. Hall, of Georgia, intro- 
duced in the House a series of five resolutions to revive 
the credit of treasury notes. The second resolution pro- 
vided that the notes should be a legal tender between 
citizens, and between citizens and foreigners, for all debts 
then due or afterward to become due, which the House 
refused to consider by a vote of 95 to 42 more than 
two-thirds. These resolutions were evidently introduced 
as measures in opposition to the proposition for a na- 
tional bank, and the other four resolutions were subse- 
quently laid upon the table by a large majority. 

On January 30, 1815, a bill authorizing the issue of 
treasury notes in accordance with the recommendations 
of Secretary Dallas in his communication of January 
17th, was introduced in the House and referred to the 
Committee of the Whole. The bill passed the House 
February llth, and the Senate February 21st, and was 
approved February 24, 1815 ; it was the last of a series 
of five acts, commencing with that of June 30, 1812, the 


first four of which had authorized the issue of treasury 
notes bearing interest at the rate of 5f per cent. The 
form of the large notes issued under this act, which in 
size were 7f by 3 inches, is shown on the next page. 

This act authorized the issue and reissue of treasury 
notes to an amount not exceeding twenty -five millions, 
upon principles essentially different from those govern 
ing prior issues. These notes might be of any denomi- 
nation : if of a denomination less than $100, they were 
designated as "small treasury notes," were payable to 
bearer, and bore no interest ; if of a denomination of 
100 or upward, they were payable to order, transferable 
by indorsement, and bore interest at the same rate as 
those of $100 and upward previously authorized. The 
form of the "small treasury notes," in size 6 by 3 
inches, is shown on page 36. 

These notes were not chargeable upon the sinking fund, 
as in the case of the first three acts of the series, nor 
were they payable out of any money in the treasury not 
otherwise appropriated, as in the previous act of Decem- 
ber 26, 1814, but rested entirely upon the provision 
making them fundabie into stock. The principal and 
interest were not payable at any specified time, but the 
notes were everywhere receivable in all payments to the 
United States. The act reduced the pay of those sign- 
ing the notes to seventy -five cents for each one hundred 
notes, and also provided that treasury notes of previous 
issue should be fundabie into 6 per cent, stock. The 
holders of the small treasury notes could exchange them 
at pleasure, in sums of not less than $100, for certificates 
of funded stock bearing interest at 7 per cent. The 
treaty of peace was signed on December 14, 1814, but 



the news reached Washington a few days only before 
the passage of the bill, which, although a war measure, 
was carried through, inasmuch as it was considered 
necessary to the regulation of the disordered finances of 
the country. The whole amount of treasury notes, ab- 
solute and contingent, which was authorized by these 
five acts, was $60,500,000, of which amount $36,680,794 
was issued. The following table exhibits the amount 
issued under each act : 

Under act of June 30, 1812 $5,000,000 

Under act of February 25, 1813 5,000,000 

Under act of March 4, 1814 10,000,000 

Under act of December 26, 1814 8,318,400 

Under act of February 24, 1815 $100 notes. .$4,969,400 
Under act of February 24, 1815 small treas- 
ury notes 3,392,994 


Total amount issued $36,680,794 

Although the treasury notes of 1815 of small denomi- 
nations, originally issued, amounted to only $3,392,994, 
the law made them fundable into 7 per cent, stock, 
payable after December 31st; and as the notes were re- 
issuable, they were, under various exigencies, again and 
again paid out, until the whole amount of the 7 per 
cent, stock issued for the purpose of funding them, 
amounted to $9,070,386. On account of the high rate 
of interest of these bonds, the small treasury notes were 
in demand, and a small amount was sold at a premium 
of 4 per cent., and $1,365,000 at a premium of 
$32,107.64, or about 2 per cent. The Secretary, in 
his annual report for 1815, says : " The treasury notes, 


which were issued under act passed previous to February 
24, 1815, were, for the most part, of a denomination too 
high to serve as a current medium of exchange ; and it 
was soon ascertained that the small treasury notes, 
fundable at an interest of Y per cent., though of a con- 
venient denomination for common use, would be con- 
verted into stock almost as soon as they were issued." ' 
The notes of $100 and upward, though fundable into 6 
per cent, bonds, were depreciated from 8 to 10 per cent, 
below bank notes, which bore no interest, but were re- 
deemable in specie. 

In recapitulation, it may be stated that the treasury 
notes of the period of the war of 1812 were issued under 
five acts of Congress, as stated in the table. The notes 
of the first three acts were made chargeable to the sink- 
ing fund those of the last two, not ; those of the first 
two acts were in denominations of not less than $100 ; 
those of the next two were not less than $20 ; and those 
of the last act were in denominations of $3, $5, $10, $20, 
$50, $100 and upward. Those of the first three acts 
were not originally fundable into stock, but were made 
so by the act of November 15, 1814, and by the subse- 
quent act of February 24, 1815. The notes of the acts 
of December 26, 1814, became fundable by the act of 
February 24, 1815, but those of the last-named act were 
fundable by the terms of their authorization. The notes 
of all the acts but the last were made payable one year 
from the date of their issue ; those of the last act were 
payable at no fixed date. All of these notes (with the 
exception of the small treasury notes, which were with- 

1 Report of the Secretary of the Treasury, 1815, p. 26. 


out interest) bore interest at the rate of 5f per cent. 
None were in the form of a promise to pay coin on de- 
mand, but all in the form of a receipt for all dues pay- 
able to the Government. None of these notes had any 
legal tender quality, and Congress, without debate, re- 
jected the only proposition made to give them this 
quality. The denominations, except in the case of the 
small notes of 1815, were too large for general circulation, 
and the inducements for funding the latter were so great 
that they were speedily funded into seven per cent, bonds. 
As long as the banks redeemed their notes in specie, treas- 
ury notes appear to have been kept at par, but when 
specie payments were suspended, they began to depreci- 
ate, but were kept from great discount by the funding 
acts of November 25, 1814, and February 24, 1815. It 
is said, " that of eighty millions of loans negotiated by 
the Government during this period, the avails were 
only thirty-four millions, after deducting discounts and 
depreciations." ' After the close of the war, in Decem- 
ber, 1814, these notes were rapidly funded. 

1 Report of Committee of Ways and Means, April 13, 1830, 


OF 1837. 

Ix anticipation of a large surplus, Congress, by act of 
June 23, 1836, provided for the distribution of a large 
amount of Government money among the States in pro- 
portion to their representation in the Senate and House 
of Representatives, and three instalments, amounting in 
all to 27,063,430, were so distributed. 1 In the mean- 
time, about May 1, 1837, specie payments were suspended, 
owing to the great depression in commercial circles. An 
extra session of the 25th Congress was called in Septem- 
ber of the same year. The charter of the second Bank 
of the United States had expired on March 4, 1836, and 
on June 23, 1836, Congress had passed an act authoriz- 
ing and regulating the deposit of public moneys in State 
banks. No action was taken during the extra session 
toward rechartering the Bank of the United States. 
The distribution of the fourth instalment to the States 
was, however, postponed, but the Secretary was pro- 
hibited from calling for any of the money already dis- 
tributed without special authority from Congress, which 
has not, up to the present date, been given. 

The revenues for the year (1837) were from six to ten 

1 See page 180. 


millions short of the expenditures. The public funds 
already deposited with the States were unavailable, and 
there was another instalment to be deposited on Octo- 
ber 1st. The Secretary recommended the withholding of 
this instalment, and, in order to supply currency, an is- 
sue of treasury notes, the small denominations to bear 
no interest, and the large with interest. 

A large party in Congress were in favor of recharter- 
ing the Bank of the United States. The advocates of 
treasury notes urged the issue principally upon the 
ground of necessity, there being no currency upon which 
the Government could rely to make and receive pay- 
ments. Many were in favor of a substitute to be issued 
by the proposed new Bank of the United States. A 
bill was presented and passed by the Senate. When it 
came to the House, objection was made that it was a 
money bill, which the Senate had no constitutional right 
to originate. This point was not discussed, but the 
Committee of Ways and Means presented their own bill, 
by which the issue of ten millions in treasury notes was 
authorized. The bill encountered much opposition, par- 
ticularly from those in favor of authorizing a new bank, 
but passed the House on October 9, 1837, by a vote of 
127 to 98, which was a strict party vote. In the Senate, 
the next day, Mr. Bentori moved to make the lowest de- 
nomination of notes $100, instead of $50, as provided in 
the bill. He presented strong objections to the issue of 
treasury notes. Nothing but the fact that the Govern- 
ment must otherwise stop for want of funds, would in- 
duce him to vote for paper money in time of peace. 
He particularly objected to the policy of reducing the 
denominations of paper currency. It was the most dan- 


gerous feature of the system, and would drive all specie 
from circulation. Mr. Clay spoke in favor of Mr. Ben- 
ton's motion, and characterized the whole measure to be, 
to all intents and purposes, a great bank experiment, and 
allnded to the inconsistency of issuing, in time of pro- 
found peace, ten millions additional notes after decrying 
the banks for enlarging their circulation. Mr. Webster 
favored Mr. Ben ton's motion. It was lost by a vote of 
25 to 16. The bill then passed by a vote of 35 to 6, 
both Mr. Benton and Mr. Webster voting for it, and Mr. 
Clay against it. This bill authorized the issue of treas- 
ury notes to an amount not exceeding ten millions, and 
in denominations not exceeding fifty dollars. The in- 
terest was not to exceed 6 per cent ; and they were to be 
payable, principal and interest, after one year from date, 
and were, for the first time, signed by the Treasurer and 
countersigned by the Register. They were to be issued 
in payment of the debts of the United States to any 
creditor who would receive them, and were to be re- 
ceivable in payment of all debts and dues to the Gov- 
ernment. They were not reissuable, and the authority 
to issue terminated December 31, 1838. The ten mil- 
lions authorized were issued by Secretary Woodbury 
previous to July 1, 1838. About two millions \vere is- 
sued at the nominal rate of interest of 1 mill per cent.; 
three millions at 2 per cent.; and over four millions at 
5 per cent. On account of the low rate of interest 
upon a large portion of the notes, the object for which 
they were issued, namely, to supply a circulating me- 
dium, was thwarted, for they were soon presented in 
payment of taxes, and over five millions were retired be- 
fore the whole amount had been issued. 


At the end of 1837 the Secretary estimated that the 
balance in the treasury for July, 1838, would be $34,- 
187,000, of which $28,101,644 was due from the States, 
$1,100,000 due chiefly from insolvent banks, and $3,500,- 
000 from other banks, payment of which was postponed. 
These sums, and the bullion fund in the mint, reduced 
the estimated available balance in July, 1838, to about 
one million. This estimate was nearly correct, for Con- 
gress was advised by the President, in May, 1838, that 
only $216,000 of available funds remained in the treas- 
ury. There were several propositions in the House, one 
of which was a bill for authorizing loan certificates, which 
should be a legal tender to public creditors, but not re- 
ceivable for dues to the Government. The question of 
the legal tender was not discussed. Mr. Cambreleng, of 
New York, from the Committee of Ways and Means, re- 
ported a short bill, authorizing the issue of treasury notes 
to the amount of the issue of October, 1837, which had 
been redeemed and cancelled. The interest upon the 
issues already made under the laws of 1837 had been too 
small, and they had been immediately paid into the treas- 
ury when due. There were gratifying signs of a revival 
of prosperity. The Northern banks had resumed specie 
payment sooner than expected. This he ascribed to the 
firmness of the President in refusing to allow dues to the 
United States to be paid in notes of banks not paying 
specie. He referred to the passage of the Free Banking 
act of New York as a presage of sound banking in future. 
He also urged the necessity of providing notes to enable 
the treasury to meet its payment. The objections to the 
bill were much the same as those urged in the debate dur- 
ing the previous session, though they were presented with 


more force and completeness, particularly by Mr. Caleb 
Gushing, He said that such issues were bills of credit 
not warranted by the Constitution ; that they were based 
only upon the faith of the Government ; that such meas- 
ures were considered of doubtful and dangerous charac- 
ter by all the friends of democratic institutions ; and that 
Madison and others had always been opposed to the issues 
of Government paper founded not on funds or specie, 
but only upon faith or credit, and only consented to its 
expediency in remarkable exigencies. Experience had 
shown, that whatever interest they might bear, whether 
1 mill or 6 per cent., they would not be above the value 
of the notes of good banks. It \vas said that, if the 
United States under the Constitution could issue these 
bills, so could the States. They were the same as con- 
tinental money, although bearing interest. Much of the 
currency issued by the States, during the revolution, de- 
nominated bills of credit, bore interest. Chief Justice 
Marshall's definition 1 of bills of credit was, ' ' paper issued 
by the sovereign authority, and intended to circulate as 
money." These notes are issued by sovereign authority, 
and intended to circulate as money. They operate un- 
equally, and afford no general relief ; they are below par 

1 The Supreme Court of the United States in a famous case, Briscoe 
rs. Bank of Kentucky, 11 Pet., 257, held that a note of circulation 
" issued by a State, involving the faith of the State, and designed to 
circulate as money on the credit of the State, in the ordinary course 
of business," is a bill of credit. Other decisions of the Supreme 
Court Craig t. Missouri, 4 Pet., 410 ; Byrne ;. Missouri, 8 Pet., 40 
hold " that certificates issued by a State in sums not exceeding ten 
dollars nor less than fifty cents, receivable in payment of taxes, the 
faith and credit of the State being pledged for their redemption, are 
bills of credit within the prohibition of the Constitution." 


in New York, and at 5 per cent, premium in Charleston. 
The bill was amended to obviate some technical objec- 
tions, and finally passed by a small majority, 106 to 99, 
on May 16, 1838. It came up in the Senate on May 18th. 
Wright, of New York, Benton, Calhoun, Brown, and Tal- 
madge were in favor of it. Webster, Clay, Crittenden, 
and Preston were on the other side. The discussion 
took a wide range, involving the causes of the condition 
of the treasury, and the constitutionality of the issue of 
treasury notes. It passed by a vote of 27 to 13, and was 
approved on May 21, 1838. Nearly five millions were 
issued within one month after the passage of the bill, 
which showed conclusively the pressing needs of the 
treasury. Under the previous acts of October, 1837, and 
May 21, 1838, the authority to issue treasury notes ex- 
pired on January 1, 1839. The whole issue was not to 
exceed ten millions, and the latter act permitted the re- 
issue of those paid in. 

The whole amount which had been issued to Decem- 
ber, 1838, was $15,709,801.01, with interest as follows: 
$6,888,809.60 at 6 per cent. ; $4,280,273.72 at 5 per 
cent. ; $2,784,844.73 at 2 per cent. ; and $1,755,881.96 
with interest at 1 mill per cent. There had been re- 
deemed, up to the same date, $7,955,250, leaving 
$7,754,560 outstanding. The authority to reissue ex- 
pired with the year. On January 1, 1839, there was 
a large amount of notes in the treasury, which con- 
tinued to grow larger until March 2, 1839, when an act 
was passed, extending the authority to reissue until June 
30, 1839, provided the whole amount outstanding did 
not exceed ten millions. In December, 1839, Secretary 
Woodbury reported that at no time had more than ten 


millions been outstanding, and that the amount out- 
standing was less than the amount due from suspended 
banks, and from the Pennsylvania bank of the United 
States, to the Government, and that the principal and 
interest on the treasury notes had always been promptly 
paid when desired. 

A bill was subsequently presented by Mr. Jones, 
Chairman of the Committee of Ways and Means. 
Amendments were offered requiring that the notes 
should bear interest at not less than 2 per cent., and 
making them negotiable and transferable only by in- 
dorsement, in the same manner as bills of exchange : the 
first to prevent the issuance of notes at the nominal rate 
of 1 mill per cent., or one-thousandth of 1 per cent., per 
annum, and the second to prevent their circulation as 
money, and both to cure, as was alleged, the constitu- 
tional difficulty which pertained to bills of credit issued 
by sovereign authority and intended to circulate as 
money. The Whigs refused to vote, leaving no quorum. 
On March 24, 1840, the House continued in session 
from ten o'clock until five P.M. of the next day. Finally, 
when the House adjourned, the consideration of the 
bill was fixed for the following Friday, and on that day 
March 27, 1840 it finally passed the House by a vote 
of 110 to 66. It passed the Senate on March 30, 1840, 
and was approved the following day. On page 47 is 
the form of a $100 note issued under this act. On each 
end of the reverse were printed the figures 100. tinder 
this act the issues amounted to $7,114,251. Xotes 
were to be redeemed sooner than one year, if the condi- 
tion of the treasury would admit, and at any time with- 
in the year, after sixty days' notice. 


The Secretary, in his report for 1840, states, that 
treasury notes had been at par during the year, although 
never bearing interest higher than 5f per cent., 1 and 
subject to payment after sixty days' notice. To meet 
the wants of the treasury, a treasury note bill was intro- 
duced, and passed Congress on February 15, 1841. This 
law authorized an issue of notes, in the aggregate, of 
$10,000,000, one-half to be issued in payment of amounts 
due and payable prior to March 4, 1841, and the remain- 
inu' s,"), 000,000 in payment of amounts due and payable 
after that date. In all, $7,529,062 were issued under 
act of February 15, 1841. 

In the fall of 1840, Harrison had been elected Presi- 
dent to succeed Van Bnren, but died April 4, 1841. 
He was the representative of the Whig party, which had, 
since the year 1837, so bitterly opposed the issue of 
treasury notes. Mr. Ewing, of Ohio, was appointed Sec- 
retary of the Treasury by President Harrison. In his re- 
port to Congress at its special session of May 31, 1841, 
he said that, from January 1, 1837, to March 4, 1841, 
the expenditures of the Government had exceeded the 
revenues by over $31,000,000. Of about twenty-six 
millions of treasury notes issued under the acts from 
October 12, 1837, to February 15, 1841, inclusive, all 
but about six millions had, as claimed by Secretary 
Woodbury, been issued in anticipation of revenues, or 
upon the basis of existing debts due to the United States, 
leaving about six millions outstanding when the new ad- 
ministration came in. Mr. Ewing estimated that the 
deficit in the revenues for the year 1841, after meet- 

1 Finance Report, vol. iv., p. 354. 


ing the current expenses and redeeming the treasury 
notes then outstanding and to be issued, would be 
$12,088,215, which he considered to be the amount 
of the public debt. He objected to the issue of treas- 
ury notes, and recommended a loan redeemable after 
eight years or upon six months' notice by the Govern- 

A bill was introduced by Millard Fillmore, Chairman 
of the Committee of Ways and Means, on June 24th. It 
provided a loan, payable after January 1, 1856, with in- 
terest at 5 per cent., and authority was given the Secre- 
tary to purchase the bonds out of any surplus in the 
treasury. It was objected that the loan was unnecessary, 
and that it was the commencement of a scheme to or- 
ganize a national bank. The debate was bitterly politi- 
cal. It was urged, that as this was an administration 
measure, the loan should be paid within the term of the 
administration. This point was foolishly conceded, but 
the rate of interest was raised to 6 per cent. As thus 
amended the bill became a law on July 21, 18-11. The 
reduction of the length of the loan from eight to three 
years, together with the proviso that no stock could be 
sold below par, destroyed the usefulness of the measure, 
and less than one-half, or only 5,672,076, of the stock 
was sold, which was about equal to the amount of treas- 
ury notes outstanding. 

On September 13, 1841, Mr. Ewing was succeeded by 
Secretary Forward, of Pennsylvania. The policy of the 
administration was changed by the death of the Presi- 
dent. The repeal of the Independent Treasury act 
August 13, 1841, which had been authorized at the close 
of the Yan Buren administration, was about the only 


point gained by the Harrison administration, and this 
repeal practically left the treasury to be managed by 
those who were unfriendly to the policy of the Whig 

A bill for the issue and reissue of treasury notes was 
introduced into the House by Mr. Fill more, January 5, 
1842. Among other proposed amendments which were 
rejected, was one by Mr. Ben ton, heavily taxing all 
bank circulation, especially small notes. The bill be- 
came a law January 31, 1842. Under it the amount 
authorized to be outstanding at any one time was limited 
to five millions, but the total amount issued and reissued 
was 87,959,994. The subsequent act of August 31, 

1842, authorized the issue and reissue of treasury notes, 
provided the amount outstanding at any one time 
should not exceed six millions, and under it notes to 
the amount of $3,025,554.89 were issued. 

All of the notes issued since the act of October 12, 
1837, were issued payable either one or two years after 
date, chiefly for one year. These notes were continually 
falling due and embarrassing the treasury. Eleven 
millions of such notes were to fall due during the year 

1843, and accordingly another bill was introduced by 
Mr. Fillmore, providing for the reissue of such notes as 
should be redeemed before July 1, 1844. The bill be- 
came a law on March 3, 1843. 

The amount of the treasury notes outstanding on the 
dates named from November, 1837, to March, 1843, are 
shown in the following table : ' 

1 Page 186, 3d Session 27th Congress, Appendix. Speech of 

















November . . . 

John C. Spencer succeeded Walter Forward as Secre- 
tary of the Treasury, on March 3, 1843, and was himself 
succeeded, on June 15, 1844, by George M. Bibb. Under 
the act of March 3, 1843, Mr. Spencer issued about 
$850,000 treasury notes. On the face of each note 1 was 
engraved " The United States promise to pay, one year 
after date, to or order, fifty dollars, with interest 
at the rate of 1 mill per $100 per annum." On the back 
of each note, lengthwise, was engraved, " This note will 
be purchased at par for the amount of principal and in- 
terest thereof, on presentation at either of the Deposi- 
taries of the Treasury in the City of Xew York." These 
notes, which were issued at the nominal rate of interest 
of one-thousandth of 1 per cent, per annum, and by the 
indorsement made payable on demand, were considered 
by Congress an evasion of the act under which they were 
issued. The Secretary of the Treasury, in his report for 
December 6, 1843, had stated that less than $270,000 
of these notes had then been issued, and asserted that 
the right to purchase such notes at par on presentation 
was given by the eighth section of the act of October 12, 
1837, as follows : "And the said Secretary is further 
authorized to make purchases of the said notes, at par, 

1 See Frontispiece. 


for the amount of the principal and interest due at the 
time of purchase on such notes." The Committee of 
Ways and Means were instructed, on January 15, 1844, 
" to inquire and report whether the notes lately issued 
by the Treasury Department, bearing a nominal in- 
terest and convertible into coin on demand, and now 
forming part of the circulating medium of the country, 
are authorized by the existing laws and Constitution of 
the United States ; " and the report of the Commit- 
tee, which also contains a letter of the Secretary 
giving his views on the subject, is interesting from 
the fact that it contains the principal constitutional ar- 
guments against the issue of paper money by the Gov- 
ernment. 1 

During the second session of the 27th Congress, 
after the veto, by President Tyler, of a bill to au- 
thorize the organization of a Bank of the United 
States, he recommended the passage of a bill for the 
issue of exchequer bills of not less than $5 in denomina- 
tion, which notes were to be signed by the Treasurer of 
the United States, and countersigned by the President of 
the Board of Exchequer, and redeemable in gold and 
silver on demand at the agency where issued. This bill, 
which was prepared at the Treasury Department, did not- 
become a law, and it was claimed by the Committee^ tliat 
the notes issued by Secretary Spencer were in, mpst re- 
spects like the exchequer notes proposed \\\ this bill. 
The principal difference was, that while the exchequer 
notes were to be in denominations as law as $5, without 
interest, the notes issued were of denominations not less 

1 Report Xo. 379, 28th Congress, 1st Session, H, pf -R, 


than 850, and bore a merely nominal rate of interest. 
It was claimed by the Committee that the Constitution 
authorized the Government to borrow money, but not to 
issue bills of credit ; that borrowing money implied the 
paving of interest for the money borrowed ; that inter- 
est-bearing treasury notes payable at a future day were 
a temporary loan, not designed to circulate as money, 
and could properly be issued ; while notes bearing no 
interest and payable on demand were bills of credit, and 
could be issued only in violation of the Constitution. 

The following are extracts from the report of the 
Committee : " The power to issue treasury notes 
under the act of March 3, 1843, at a rate of interest 
not exceeding six per centum per annum, should the 
wants of the public service require, in place of others 
redeemed before the first day of July, 1844, seems to 
be clearly granted. The notes are to be redeemed at 
the Treasury after one year from their dates, respect- 
ively ; and the Secretary is authorized to make pur- 
chases of said notes, at par, for the amount of principal 
and interest due at the time of purchase. This is con- 
strued to mean, and the Committee do not intend to 
question such construction, a purchase before the expira- 
tion of one year, when the notes would, by limitation of 
time, become payable. Such purchases, however, in an- 
ticipation of time, necessarily imply the ability of the 
treasury to make them, and fair notice to the holders. 
These issues promise, on their face, to pay one year 
after date. In good faith, in point of fact, they are is- 
sued because required by the wants of the public ser- 
vice. If the wants of the public service really require 
Jthe issue of .treasury notes, to supply the deficiency of 


means, then it is clearly impossible that the ability to 
purchase the notes should exist at the time of issue, and 
to make them, presently, convertible into coin. If the 
means to purchase are coextensive with the amount is- 
sued, coeval and coexistent, then it is perfectly manifest 
that the wants of the public service do not require the 
issue. If the wants of the public service require the is- 
sues, then there must be a present inability to redeem. 
Whether this inability will be removed before the efflux 
of one year depends upon the income of revenue, and 
consequent improved condition of the treasury. 

" The ability to purchase the notes within the year, 
therefore, is, at the time of issue, a future contingency ; 
which cannot be foreknown by the Secretary, so as to 
authorize him to give notice that the notes will be pur- 
chased at par, at all times on presentation, and at any 
time after the date of issue. The sound construction 
and the common-sense view of the matter seem to be, 
that the notes may be issued, if the wants of the public 
service require ; and if it shall be seen, subsequently, 
that the treasury can spare the means, then, and not till 
then, is the Secretary authorized, or indeed able, to 
make the purchase ; and ought not, and cannot, but 
upon ascertainment of the existence of those means, 
give notice to the holders of the notes to be purchased. 
How can it be known what amount in the treasury, not 
otherwise appropriated, will be applicable to the pur- 
chase ? How can it be known what specific amount, can 
be drawn from the treasury to make purchases of notes ? 

" These views render it clear that the notice endorsed 
on the notes, and issued simultaneously with them, that 
they will be purchased on presentation, is not such 


notice of purchase, as to time or amount, as the act au- 
thorizing the purchase contemplates ; nor is it such 
notice as a common borrower of money upon time, of 
one year, with the privilege of redeeming within the 
time, if able, would give to his lender. * * It is 
a useless and dangerous experiment with the public 
faith and public credit in times of peace. The public 
credit should be used sparingly in time of peace ; should 
be nursed and invigorated, so that it might be a safe 
reliance in great and pressing emergencies. But nobody 
can suppose that the Secretary either expected, desired, 
or intended, that these notes should be actually forth- 
with presented and paid. It is impossible to avoid the 
conclusion, that the whole plan of issuing notes payable 
on demand, as these notes are, in fact, made payable on 
demand, by the endorsement, is a deliberate contrivance 
of the Secretary of the Treasury, with the approbation of 
the President, to infuse into the circulation of the coun- 
try, Government paper. * * The Committee may 
admit that the maximum rate of interest being six 
per cent, per annum, and no restriction as to a mini- 
mum rate, that a mere nominal rate of interest cannot, 
of itself, be charged as transgressing the letter of the 
law. But if a mere nominal rate of interest be charged 
for the purpose of aiding in an object not contemplated 
by the law or authorized by the Constitution, then such 
nominal rate of interest is a mere pretext to cover a 
perversion of law, and a violation of the Constitution. 
The nominal rate of interest is so very small as hardly 
to admit of computation ; and for all practical purposes, 
the notes may be regarded as carrying no interest ; 
whilst the endorsement, that they will be paid at sight, 


at either of the depositaries of the Treasury, in the city 
of New York, imparts to them the character of ordinary 
bank paper, calculated and intended to circulate as 
money, in the hands of the citizens. It is an emission 
of paper, on the public credit, to be circulated as money, 
like bank notes. * * 

" It is strongly to be inferred that Congress did not 
intend or expect any departure from the former prac- 
tices, much less the introduction of a new principle. 
For the Committee conceive that the issue of notes pay- 
able on demand, out of funds then on hand, and in the 
treasury, is totally different in principle from the issue 
of notes promising to pay one year after date, intended 
to supply a present deficit in the treasury, and to be re- 
imbursed thereafter out of accruing revenue. * * The 
power to borrow money on the credit of the United States 
was unanimously given, whilst the power to emit bills of 
credit was refused was struck out of the plan proposed, 
by a vote, in convention, of nine States to two. And 
yet the Secretary of the Treasury contends that because 
there are no express words of prohibition, as there are 
applied to the States, that Congress may exercise the 
power incidentally or appertinently to the power of bor- 
rowing money, whilst the States are totally precluded 
from a resort to bills of credit, either as a principal or 
primary power, or in any way as incidentally or appro- 
priately connected with some other power clearly re- 
served to the States. It was thought that it was too 
late to undertake to revive the exploded Federal doc- 
trine of claiming power because it had not been ex- 
pressly forbidden. And it is a matter of equal surprise 
that, at this late day, it should be seriously maintained 


by any federal officer, that bills of credit (a paper cur> 
rency) may be supplied to the country under cover of the 
granted power to borrow money. The power to supply 
a paper currency is thus made of contingent existence, 
depending, first, upon the necessity of exercising the 
primary power to borrow money, and then upon the 
policy adopted of making the loan more permanent, in 
the shape of funded debt, or upon shorter time, in the 
shape of treasury notes. The want of additional cur- 
rency might possibly be experienced by the country, 
when there would be no deficiency of means in the 
treasury to make a loan necessary or proper. In this 
condition of affairs there would exist no authority to 
supply the needed currency. Again, a temporary loan 
might become necessary, and, might be authorized by 
Congress in the form of treasury notes, at a time when 
the country was abundantly supplied with a sound cir- 
culating medium, and in that condition of affairs, accord- 
ing to the argument of the Secretary of the Treasury, 
under cover of the authorized loan, and by the adoption 
of a peculiarly ingenious mode of issuing the notes of 
the treasury, a currency, not needed, might be sup- 
plied. The omission to give the power to the 
Federal Government ' to emit bills of credit ' as com- 
pletely bars that Government from the exercise of the 
power, as does the express prohibition to the States ' to 
emit bills of credit ' bar them from the exercise of such 
power. According to the received and well-established 
doctrine, that the States are sovereign, and have the 
right of self-government, it would follow that they 
might impart to their legislatures ample powers to leg- 
islate upon all subjects whatsoever meet for legislation ; 


that they might constitute them, under their own con- 
stitutions, complete legislatures. Hence they agreed, in 
convention, to abstain from the exercise of certain enu- 
merated powers, which otherwise would justly and right- 
fully pertain to them as ' free and independent States.' 
And intending, in good faith, to relinquish and abandon 
the exercise of those certain powers, they inserted in 
their constitutional compact of union express prohibi- 
tions. The States, by fair and natural construction, 
would retain to themselves all powers not conferred ex- 
clusively upon the Federal Government, or expressly 
prohibited to the States ; and yet, out of abundant cau- 
tion, and to remove the possibility of doubt or cavil, an 
express amendment of the Constitution to that effect was 
adopted and ratified. 

" It will not be questioned by the Secretary, the Com- 
mittee suppose, that the States did possess, and have re- 
served the power to borrow money. Certain it is, that 
they have very generally and very extensively exercised 
such power. Kow, if the power to borrow money on the 
credit of a State be unqualified, like the power of Con- 
gress to borrow money on the credit of the United 
States, the Committee cannot comprehend the logic by 
which the conclusion is reached, that, in the latter case, 
whilst the absolute and independent power of issuing 
bills was intentionally withheld, yet it was meant to 
leave Congress unrestricted in the choice of such means 
of borrowing, if the emission of bills should, at any 
time, be deemed the most expedient mode of attaining 
that object ; and by which, in the former case, the other 
and contrary conclusion is also reached, that whilst the 
absolute and independent power of emitting bills of 


credit is prohibited to the States, the like unrestricted 
choice in the means of borrowing, by the emission of 
bills, should at any time be deemed the most expedient 
mode of attaining that object, is not left to the States. 
Xeither Congress nor the States can emit bills of credit, 
in the exercise of an absolute and independent power. 
Congress and the States possess the unqualified power 
to borrow money. Congress is unrestricted in the choice 
of means, and may issue bills of credit, if that mode of 
borrowing should, at any time, be deemed the most ex- 
pedient. The States, however, are not equally unre- 
stricted in the choice of means, and may not issue bills, 
although that mode of borrowing should, at any time, 
be deemed the most expedient. * * When the 
loan obtained is for any considerable length of time, 
it is usual to fund the debt thereby created by issuing 
certificates of stock. Where the loan obtained has only 
a short time to run, and it is proposed to pay it off 
speedily with the accruing revenue, the ordinary mode 
is, to authorize the Secretary of the Treasury to issue 
treasury notes, payable at the expiration of a limited 
time, bearing such interest as may be expressed and al- 
lowed by the act directing the issue of the notes. Such 
notes are intended, bona fide, as a temporary loan, and 
are not designed or expected to circulate as a currency. 
Such notes were doubtless within the contemplation of 
Gouverneur Morris, when he remarked, that striking 
out the authority to issue bills of credit, would not 
prevent the use of the notes of a responsible minister, 
and that would do all the good without the mischief. 
The use of public notes can be justified only 
as the mode of effecting a loan they are employed to 

AMOUNT OF NOTE ISSUES, 1837-1844. 61 

acknowledge the existence of a debt due by the United 
States, and contain a promise to pay it, at some future 
stipulated time, with interest, as may be agreed. To 
issue notes for circulation, payable on demand, under 
cover of the authority to borrow money in the form of 
treasury notes, is deemed an abuse of authority which 
ought to be corrected." 

From March 3, 1843, until July 26, 1846, no new is- 
sues of treasury notes were authorized. From 1837 to 
1844 treasury notes amounting to $47,002,900 were is- 
sued under eight different acts, of which 846,216,935.82 
were redeemed by the close of 1845. The lowest de- 
nomination for any one note was $50, but where new 
notes were issued in place of old ones the accrued inter- 
est was often added. The amount authorized to be 
originally issued by these several acts was thirty-one 
millions. The remainder consisted of reissues. 

The notes issued under the act of October 12, 1837, 
and the six succeeding acts were all printed from the 
same series of plates, and the different rates of interest 
were inserted in writing. A new set of plates were 
prepared for notes issued under the act of March 3, 1843, 
and the following words, " with interest at the rate of one 
mill per 8100 per annum." were engraved in the body 
of the note. These notes were all of the same size, the 
largest ever issued, and measure eight by four inches. 
Photo-lithographs of the originals issued under these acts 
may be found at the beginning and end of this volume. 

The following table exhibits the amount of treasury 
notes issued each year, under different acts of Con- 
gress, from October 12, 1837, to March 3, 1843, from 
which it will be seen that the total amount issued was 


$7,002,900, all of which was sold or issued at par. 
Interest varied from 1 mill per cent, to 6 per cent., and 
the amount authorized was fifty-one millions. 

1837 Act of October 12, 1837 $2,992,989 15 

1838 Act of October 12, 1837 7,007,010 85 

1838 Act of May 21, 1838 5,709,810 01 

1839-Act of March 2, 1839 3,857,276 21 

1840 Act of March 31, 1840 5,589,547 51 

1841 Act of March 31, 1840 1,524,703 80 

1841 Act of February 15, 1841 6,468,856 70 

1842-Act of February 15, 1841 1,060,206 05 

1842 Act of January 31, 1842 7,914,644 83 

1843 Act of January 31, 1842 45,350 00 

1843 Act of August 31, 1842 2,408,554 89 

1843 Act of August 31, 1842 617,000 00 

1844 Act of March 3, 1843 1,806,950 00 

Total $47,002,900 00 



ON July 1, 1844, the public debt of the United States 
amounted to $24,748,188, and consisted principally of 
stocks not payable until the lapse of ten and twenty 
years. 1 The 5 per cent, stocks payable in ten years 
were at a premium of 106, and the 6 per cent, stocks 
payable in twenty years, at a premium of 116. The 
Secretary estimated that the revenue under the tariff of 
1842 would yield a much larger amount than was neces- 
sary. Accordingly, Congress, in July, 1846, passed a bill 
amending the tariff and reducing the duties on imports. 
In the meantime, during the year 1845, difficulties with 
Mexico, owing to the annexation of Texas, rendered war 
inevitable, and on May 13, 1846, war was declared. 
Secretary Walker estimated that, if the war should 
continue for a year, there would be a deficiency of more 
than twelve millions ; and, in order to meet this defi- 
ciency, a bill was reported from the Committee on Ways 
and Means, which, with some additions, embodied the 
provision of the act of October 12, 1837, as to treasury 
notes, and that of April 14, 1842, as to a loan. The 
following is the form of a $100 note issued under this 
act : Seepage 65. 

1 Report of Secretary Bibb, 1844. 


These notes were printed from the plates used for 
printing the notes authorized by the acts of October 12, 
1837, to August 31, 1842. The bill referred to author- 
ized an issue of treasury notes to an amount of ten mil- 
lions, which could also be reissued, and also a loan which 
could be issued in lieu of treasury notes ; the amount of 
both not to exceed ten millions. The stock was to be 
redeemable after ten years, no notes of less than $50 
were to be issued, and they were to be signed by the 
Treasurer and the llegister. The rate of interest was 
not to exceed 6 per cent. Notes were to be used in pay- 
ment of public creditors who would receive them, and 
the Secretary could borrow money on them. The 
bill became a law July 22, 1846. Under this act, 87,- 
687,800 of notes were issued, and $4,999,149 of stock. 
Of these notes $2,086,550 bore interest at 5| per cent, 
and $1,766,450 at 1 mill per cent, per annum. 

In January, 1847, the treasury was again in need, and 
to meet this necessity a bill was introduced, authorizing 
the issue of twenty-three millions of treasury notes, and 
an additional five millions under the act of July 22, 
1846. This was an elaborate bill, containing all neces- 
sary provisions within itself, without referring back to 
the provisions of previous acts, as had been usually the 
case in legislation of this kind. The debate was princi- 
pally upon the conduct of the war, and, after one or two 
amendments had been agreed to, the bill passed the 
House on the same day that it was introduced, by a vote 
of 166 to 22. In the Senate, on January 25th, a resolu- 
tion to postpone its consideration was lost, and the debate 
took considerable latitude, principally upon the tariff 
question. The general sentiment appeared to be, that 









in the midst of the war the honor of the country must 
be sustained. Finally, with some slight amendments, 
the bill passed on January 27, 1847, by a vote of 43 to 
2, and became a law on the following day. 

Notes issued under this act were not to be of a less 
denomination than $50, and were receivable in payment 
of public dues, including duties on imports, and were 
redeemable at the expiration of one or two years, and 
the interest was to cease at the expiration of sixty 
days' notice. On page 67 is the form of a 6 per cent. 
$100 note issued under this act. (A photo-lithograph 
of this note is given at end of the volume.) 

The principal of the notes was fundable into 6 per 
cent, bonds, redeemable after December 30, 1867, and 
this privilege was extended to the holders of notes issued 
under previous acts. Reissues were authorized, but the 
amount of stock and notes, at any one time, was not to 
exceed twenty-three millions. The right to issue treas- 
ury notes, under the act of July 22, 1846, was extended 
by the fifteenth section to the period fixed by these acts, 
and on the same terms, but the issue, under this section, 
was not to exceed five millions. $12,371,150 of these 
notes were issued previous to July 1, 1847, and $11,- 
956,950 additional notes were issued during the next 
fiscal year. The whole amount of issues and reissues 
under the act was $26,122,100, all of which were either 
sold or paid to public creditors at par. The rate of in- 
terest of the notes was 5| and 6 per cent., and United 
States 6 per cent, bonds, chiefly for the purpose of re- 
deeming these notes, were issued under the same act, 
amounting to $28,230,350. 



THE treasury notes issued under the act of January 28, 
1847, were all retired, with the exception of about $200,- 
000, previous to July 1, 1S50, and no additional treasury 
notes were authorized, until the passage of the act of 
December 23, 1857. Secretary Cobb, in his report for 
that year, estimated that the receipts would exceed the 
expenditures, but said that the financial revulsion which 
had caused the banks to suspend specie payment in Octo- 
ber of that year, had also caused a large part of the duti- 
able merchandise to be stored without payment of duty, 
where it could remain tinder the law for three years, 
although it was probable that a considerable portion 
would be withdrawn and the duties paid previous to that 
date. Meanwhile, means should be provided for meet- 
ing the demands upon the treasury, and he recommended 
that authority should be given to issue treasury notes 
" for an amount not exceeding twenty millions of dollars, 
and payable within a limited time, and carry a specified 
rate of interest." A bill, in accordance with the sugges- 
tion of the Secretary, was introduced into both Houses of 
Congress on December 18, 1857. It passed the Senate 
on the following day, by a vote of 31 to 18, and the 
House on the 22d i>y a vote of 118 to 86, and was ap- 
proved on the following day and became a law. The 
bill provided for the issue of notes payable in one year 


from date of issue, to an amount not exceeding twenty 
millions. $6,000,000 were to be issued at a rate of inter- 
est not exceeding 6 per cent. The remainder was to be 
sold after public advertisement of not less than thirty 
days, at their par value, for specie, to the bidders offering 
to take them at the lowest rate of interest, not exceeding 
6 per cent. The interest upon the notes was to expire, 
after maturity of notes, upon sixty days' notice from the 
Secretary, of his readiness to redeem such notes ; they 
were to be issued in denominations of not less than $100, 
and were to be signed by the Treasurer and Register ; 
they were receivable in payment of all dues to the United 
States. The whole amount authorized was issued, and 
the amount of issues and reissues, in all, was $52,778,900. 
The interest upon these notes was as follows : $6,323,600 
at 3 per cent.; $985,000 at from 3to 4 percent.; $688,- 
000 at 4 per cent.; 10,055,700 at 4 per cent.; $4,532,- 
500 at 4f per cent.; $7,533,900 at 5 per cent.; $8,204,- 
500 at 5^ per cent.; $3,514,100 at 5| per cent.; and 
$10,941,600 at 6 per cent. On page 73 is the form of a 
3 per cent. $100 note issued under this act. 

The following table exhibits the different kinds of 
treasury notes outstanding which were issued from the 
organization of the Government to the date of the pas- 
sage of the act of March 2, 1861, and which had not 
been presented for payment on January 1, 1885 : 



Bate of Interest. 



Treasury Notes, 1846. 
Treasury Notes, 1846. 
Treasury Notes, 1847. 
Treasury Notes, 1857. 

Prior to 1846 
July 22, 1846 
Jan. 28, 1847 
Dec. 23,1857 

1 mill to 6 per cent. 
1 mill to 6 per cent. 
6 per cent. 
3 to 6 per cent. 




The total public debt on June 20, 1860, was $64,769,- 
703.08. The outstanding treasury notes issued under act 
of June 23, 1857, were $19,690,500. The amount of treas- 
ury notes outstanding, issued under acts previous to that 
date, was $105,111.64. The act of June 22, 1860, au- 
thorized a loan of twenty-one millions, at a rate of in- 
terest not exceeding 6 per cent., to be reimbursed within 
a period not more than twenty years, and not less than 
ten years. The money was to be used in the redemp- 
tion of treasury notes, and to replace any amount paid 
to the treasurer iii such notes for public dues. Under 
this authority, proposals were invited by Secretary Cobb, 
on September 8, 1860, for ten millions of this loan, 
which amount was " ample to meet all the treasury notes 
that would fall due before January 1, 1861." In his 
report for December 4, 1860, he says : " The rate of 
interest was fixed at 5 per centum per annum, under 
the conviction that the loan could be readily negotiated 
at that rate, for, at that time, the 5 per cent, stock of 
the United States was selling in the market at the pre- 
mium of 3 per cent. The result realized this just ex- 
pectation, and the whole amount offered was taken, 
either at par or a small premium." Before, however, 
the time had arrived for payment on the part of the 
bidders, political complications arose, which affected 
the credit of the Government so unfavorably that the 
amount realized was but $7,022,000, the subscribers of 
$2,978,000 having failed to make good their subscrip- 
tions. The Secretary stated that, in the present condition 
of the country, capitalists were unwilling to invest in 
United States stock at par, and recommended a repeal 
of so much of the act of June 22, 1860, as authorized 



the issue of the additional stock, and asked for authority 
for the issue of treasury notes for the same amount, " to 
be negotiated at such rates as will command the confi- 
dence of the country." He recommended that the public 
lands be unconditionally pledged for the ultimate re- 
demption of all the treasury notes which it may become 
necessary to issue, and suggested, " that there should al- 
ways exist in the Department power to issue treasury 
notes for a limited amount, under the direction of the 
President, to meet unforeseen contingencies. It is a 
power which can never be abused, as the amount realized 
from such source can only be used to meet lawful de- 
mands upon the treasury. Ko Secretary of the Treasury 
or President would ever exercise it, unless compelled to 
do so by the exigencies of the public service. On the 
other hand, it would enable the Government to meet, 
without embarrassment, those sudden revulsions to which 
the country is always liable, and which cannot always 
be anticipated. I have already stated that provision 
should be made at once to relieve the treasury from its 
present embarrassment, produced by the causes referred 
to. To do this, Congress should authorize the issue of 
an additional amount of treasury notes, not less than ten 
millions of dollars ; w r ith this means the Department 
would be enabled to meet all lawful demands upon it 
for the present. The extent of the financial crisis, 
through which the country is now passing, cannot now 
be determined, and until it is better known, no policy 
can be recommended of a permanent character." 

Secretary Cobb resigned on December 10th, but the 
act of December 17, 1860, w r as passed in compliance 
with the suggestions contained in his report. The pledge 


of the proceeds of the public land was not given in the 
act, and one of the reasons for withholding such legis- 
lation was, that it would interfere with the passage of 
the homestead bill which, was then under consideration. 
The act authorized the issue of ten millions of treasury 
notes in denominations of not less than $50, redeemable 
in one year from the date of issue, with interest at the 
rate of 6 per cent., but the Secretary was authorized to 
issue sucli notes after advertisement at the lowest rate of 
interest offered. Of these notes, five millions were of- 
fered to subscribers. The bids were opened December 
28th, and only $500,000 were taken at 12 per cent. It 
was important to negotiate the loan, in order to meet 
the interest on Government bonds upon January 1st. 
The remainder of the loan was subscribed by the 
banks in New York, previous to that date, at 12 per 

Gen. John A. Dix was appointed Secretary of the 
Treasury on January llth, and bids for the remaining 
$5,000,000 were opened on the 19th, and the notes 
awarded at the average rate of 10| per cent., as follows : 

$10,000 at 8| per cent. 

30,000 9 

10,000 9i 

140,000 9 

67,000 9| 

721,000 10 

265,000 10 

543,000 10| 

1,267,000 lOf 

1,947,000 11 

Total.. $5,000, 000 Average, 10| per cent. 


The whole ten millions were issued, redeemable at the 
expiration of one year from date, bearing interest as 
follows : $70,200 at 6 per cent. ; $384,500 at rates va- 
rying from 6 to 10 per cent. ; $1,027,500 at 10 per 
cent. ; $3,688,700 at rates from 10 to 12 per cent. ; and 
$4,840,000 at 12 per cent. Additional offers bearing in- 
terest, ranging from 15 to 36 per cent., were declined. 
The amount of treasury notes outstanding on Decem- 
ber 1, 1860, previous to the passage of this act, was 
$14,599,700, of which $42,600 was payable in 1859, 
$3,133,400 in 1860, and $11,423,700 in 1861. Of these 
notes, $8,684,200 bore interest at 6 per cent., and the 
remainder at lower rates. 

Secretary Dix, in a letter to the Chairman of the Com- 
mittee of Ways and Means, dated January 18, 1861, says : 
" Within the last few days the amount of over-due treas- 
ury notes presented for redemption has exceeded the 
power of the Treasurer to place drafts for payment on the 
Assistant Treasurer at New York, where the holders de- 
sire the remittances to be made ; and an accumulation of 
warrants, to the amount of about $433,000, has accrued on 
this account in the Treasurer's hands, which he has been 
unable to pay." He also says : " That notice issued on 
the 18th ultimo invited proposals for the exchange of 
five millions of dollars for treasury notes, and offers at 
12 per cent, or less were made only to the amount of 
$1,831,000 ; offers to exchange $465,000 for notes bear- 
ing interest at rates varying from 18 to 36 per cent, 
were also received. The offers at 12 per cent, and less 
were accepted; those above that rate were rejected. 
The remainder of the five millions offered was soon 
thereafter taken at 12 per cent., and the whole amount 


was pledged to the payment of over-due treasury notes 
and other pressing demands on the treasury. * * 
During the last quarter, about eight millions of treasury 
notes were redeemed, which, with the two and one-half 
millions redeemed since the first instant, make ten and 
a half millions. The amount received from the loan, a 
small fraction above seven millions, threw upward of 
three and a half millions of these notes on the other re- 
sources of the treasury for redemption. This is one of 
the principal causes of the delay and difficulty which 
have recently existed in providing for other demands of 
public service." So low had the credit of the Govern- 
ment fallen, through the political agitations and troubles 
just previous to the War of the Rebellion, that he closed 
his communication by calling attention to the fact, that, 
'" there are deposited with twenty-six of the States, for 
safe keeping, over twenty-eight millions of dollars be- 
longing to the United States, for the payment of which 
the promise of these States is pledged by written instru- 
ments on file in this Department. The annual statement 
of receipts and expenditures for the year ending June 
30, 1860, represents this amount as part of the ' balance 
in the treasury ' 011 that day. * * I refer to this 
final resource as an available one, should the public ex- 
igencies demand it. It is not doubted that the greater 
portion of the amount so deposited would be promptly 
and cheerfully paid should an exigency arise involving 
the public honor or safety. If, instead of calling for 
these deposits, it should be deemed advisable to pledge 
them for the repayment of any money the Government 
might find it necessary to borrow, loans contracted on 
such a basis of security, superadding to the plighted 


faith of the United States that of the individual States, 
could hardly fail to be acceptable to capitalists." 

During the following month the act of February 8, 
1861, was passed, which authorized a loan not exceeding 
twenty-five millions of 6 per cent, bonds, the avails to be 
used in the payment of current expenses, for the redemp- 
tion of outstanding treasury notes, and to replace in the 
treasury such amounts as had been paid in treasury notes. 
Of this loan, bearing 6 per cent, interest, and having 
twenty years to run, $18,415,000 was issued, at an aggre- 
gate discount of $2,019,776, or an average rate of $83.03 
for $100. In less than a month after the passage of this 
act providing for the payment of tlie treasury notes out- 
standing, the act of March 2, 1861, was passed, which au- 
thorized a loan of ten millions at 6 per cent., redeemable 
upon three months' notice, after July 1, 1871, payable 
July 1, 1881, or, instead thereof, the issue of $10,000,000 
of new notes in denominations of not less than $50, bear- 
ing interest at the rate of 6 per cent, per annum, payable 
semi-annually, receivable in payment of all debts due the 
United States, including customs duties, and redeemable 
at pleasure, within two years from the passage of the act. 
The same act largely increased the duties on imports, 
and authorized the substitution of treasury notes for the 
w^hole or a part of the loans previously authorized. Under 
this act, $35,364,450 in all, of treasury notes, were issued, 
of which $22,468,100 were redeemable in two years, and 
$12,896,350 redeemable in sixty days after date ; and a 
considerable portion of these notes were paid out to cred- 
itors. A new series of plates was prepared for each of 
the issues of treasury notes under the acts of January 28, 
1847, December 23, 1857, and March 2, 1861. The size 
of the latter note was 7| by 3f inches. 



GENERAL Dix was succeeded by Secretary Chase on 
March '7, 1861. The great increase of import duties, 
imposed by the act of March 2d, had caused the bonds 
of the Government to advance in the market, and it 
seemed to be a favorable time to offer the remainder of 
the bonds authorized by the act of February 8, 1861. 
Bids for eight millions of the bonds were opened on 
April 2d. Offers at from 94 to par were received for 
$3,099,000, and 93 for the remainder of the loans. All 
bids below 94 were rejected. In the midst of these 
negotiations it became known that arrangements were 
being made to send an additional force for the relief of 
Fort Sumter. Xo additional bonds were sold until May 
31st, when $7,310,000 were sold at an average rate of 
$85.34 for $100. In place of bonds, five millions of 
treasury notes were offered, and the bids opened on April 
llth amounted to only one million; but shortly there- 
after the whole amount offered was taken. On the fol- 
lowing page is the form of a $50 note issued under the 
act of March 2, 1861. The United States 6 per cent, 
bonds were selling in the market at 83, and money at call 
was worth from 4 to 5 per cent. ; but the treasury notes 
bearing 6 per cent, interest could be held and used or sold 



, 3 

V ^ Q ^ 

*S ^11 

"X ^ 3 ^ *** 

si . |^^^t3 

' 5 


S ^ 

1 - 



at a profit for the purpose of paying duties. Additional 
treasury notes of the same kind, as lias been seen, were 
subsequently sold, amounting, in all, to more than thirty- 
five millions, at rates ranging from par to l^Vo per cent, 

Civil war was inaugurated by the attack on Fort Sum- 
ter on April 12th. The fort surrendered on April 14th, 
and on the following day President Lincoln issued a call 
for seventy -five thousand soldiers. The Southern States 
were declared blockaded. Seven of these States had, by 
ordinances, publicly declared their secession from the 
Union, and their defiance of the national authority, and 
a convention at Montgomery, Alabama, had organized a 
new government, under the name of " The Confederate 
States of America." Massachusetts soldiers, on their 
way to Washington, were attacked by a mob in Balti- 
more. In the month of May the Confederate capital 
was removed to Richmond ; North Carolina and Arkan- 
sas seceded, and the Union army crossed the Potomac 
into Virginia, and took possession of Alexandria and 
Arlington Heights. In June, Tennessee passed an or- 
dinance of secession, and General Butler was defeated 
at Big Bethel. The two-year treasury notes which had 
been recently issued at par were at 2 per cent, discount ; 
and the Government, instead of disposing of the notes, 
borrowed five millions at sixty days upon them as col- 
lateral security. During the following month the disas- 
trous results of the first battle of Bull Hun startled the 
entire country. The Union army, defeated, fell back 
upon Washington, and the capital of the country was 
believed to be in danger. Two days thereafter, Presi- 
dent Lincoln called for five hundred thousand three-year 


volunteers. An extra session of Congress had been 
called for July 4, 1861, and on that day, amid events 
like these, Secretary Chase transmitted his first report 
to Congress, which recommended measures to provide 
the means for continuing a civil war which proved in 
magnitude to be unequalled in the history of nations. 

Specie payments were suspended on December 28, 
1861. The war was carried on chiefly by the use of 
treasury notes as a circulating medium. The purchasing 
power of these notes rapidly declined. Prices of all 
kinds advanced rapidly, and particularly the prices of 
articles most needed for the supply of the army. The 
expenditures of the Government during the four years 
of the war were vastly increased beyond the amount 
which would have been necessary if the war could have 
been conducted upon the gold standard, instead of upon 
the fluctuating standard of the legal tender paper dollar. 

Xever was a great national debt contracted so rapidly. 
In 1835, as has been seen, the country was entirely out 
of debt. General Lee surrendered at Appomattox, on 
April 9, 1865 ; which date was four years, lacking five 
days, after Fort Sumter had surrendered to the enemy. 
On the first day of July. 1861, the debt was 90 millions ; 
at the close of that fiscal year it had reached 524 mil- 
lions ; at the end of the succeeding year, it was consid- 
erably more than twice that amount, being on July 1, 
1863, $1,119,772,138. During the following year it in- 
creased nearly 700 millions. For the next nine months, 
to the close of the war, it increased at the rate of about 
sixty millions a month. An immense amount of obliga- 
.tions against the Government were presented, after the 
close of the war, and for the five months thereafter the 


ascertained debt increased at the rate of three millions 
a day. The cost of conducting the war, after it was once 
fully inaugurated, was scarcely at any time less than 
thirty millions a month. At many times it far exceeded 
that amount ; sometimes it was not less than ninety 
millions a month, and the average expenses of the war, 
from the date of its inception to its conclusion, may be 
said to have been not less than two millions each day. 

The public debt reached its maximum on August 31, 
1865, at which day it amounted to $2,845,907,626.56. 
Of this amount, $1,109,568,191 was in. funded debt ; 
$1,503,020 was debt which had matured ; and $2,111,000 
was in suspended requisitions. The remainder was as 
follows : 

United States legal tender notes $433,160,569 00 

Compound interest legal tender notes 217,024,160 00 

Five per cent, legal tender notes 33,954,230 00 

Seven-thirty notes 830,000,000 00. 

Fractional currency 26,344,742 51 

.Temporary loans 107,148,713 16 

Certificates of indebtedness . . 85,093,000 00 

Total $1,732,725,414 67 

There were more than 684 millions of these obligations 
which were a legal tender, of which 217 millions were 
bearing compound interest at the rate of 6 per cent. ; 
830 millions were in treasury notes, bearing interest 
at the rate of 7 T 3 per cent, per annum. There were 
$1,540,483,701 of treasury notes, either payable on de- 
mand or bearing interest. If the temporary loans, which 
were payable in thirty days from the time of deposit, after 
notice of ten days, and the certificates of indebtedness, 


which bore interest at 6 per cent., payable one year after 
date, or earlier, at the option of the Government, are in- 
cluded with the treasury notes, the whole would amount 
to considerably more than three- fifths of the whole pub- 
lic debt of the country. 

Secretary Chase, in his report, estimated the whole 
sum required for the fiscal year to be not less than 318 
millions, of which 215 millions would be required for 
the war and naval service ; more than twelve millions 
($12,639,861.64) to pay treasury notes due and to be- 
come due, and nine millions to pay interest upon the 
proposed new debt. He was of the opinion that not 
less than eighty millions should be provided by taxation, 
and 240 millions obtained by loans. The principal part 
of the revenue was to be obtained from the tariff, the 
remainder by a system of direct taxation or internal 
duties. Six per cent, bonds, amounting to $18,415,000, 
had already been sold at from par to $85.34 for $100, 
and treasury notes bearing interest at 6 per cent, had been 
paid to creditors. He considered that " in a contest 
for national existence and the sovereignty of the peo- 
ple, it is eminently proper that the appeal for the means 
of prosecuting it with energy to a speedy and successful 
issue should be made, in the first instance at least, to the 
people themselves." 

Among other recommendations, he proposed a loan of 
100 millions, to be issued in the form of treasury notes, 
or exchequer bills, bearing interest at the rate of 7 T 3 T per 
cent., to be paid semi-annually, and redeemable at pleas- 
ure, after three years from date. The interest at this 
rate was suggested, because it was liberal to the subscrib- 
ers, convenient for calculation, and, under existing cir- 


cumstances, a fair rate for the Government. The rate 
would be convenient for calculation; for, the interest 
being equal to one per cent a day on $50, two cents a 
day on $100, ten cents on $500, twenty cents on $1,000, 
and one dollar on $5,000, it would be only necessary to 
consider the number of days since the date of the note, 
to determine, at the close, the amount due on it. It was 
proposed to issue these notes in sums of fifty, one hun- 
dred, five hundred, one thousand, and five thousand dol- 
lars, with the amount of interest for specified periods 
engraved on the back of each note, and the facility thus 
secured to the holder of determining the exact amount 
of interest, it w r as thought, would enhance its value. 
" While the rate proposed is thus liberal and convenient, 
the Secretary regards it also as, under existing circum- 
stances, fair and equitable to the Government. The 
bonds of the United States, bearing an interest of 6 per 
cent., and redeemable twenty years after date, cannot be 
disposed of at current market rates, so that the interest 
on the amount realized will not exceed 7 T 3 Q- per cent.; nor 
is there any reason to believe that treasury notes, bearing 
an interest of 6 per cent., receivable for public dues and 
convertible into twenty years' 6 per cent, bonds, can be 
disposed of in any large amounts, so that the interest on 
the sum realized will not fall much, if at all, short of the 
rate proposed. For the difference of interest, if any, be- 
tween such notes and those of the proposed national loan, 
the Secretary thinks that the absence of the feature of 
receivability for public dues in the latter is a sufficient 
compensation." He also proposed notes of small denomi- 
nations, ten, twenty, and twenty-five dollars, payable one 
year from date, to an amount not exceeding fifty mil- 


lions, bearing interest at the rate of 3^^ per cent., to 
be exchanged for the other form of treasury notes, bear- 
ing interest at Ty 3 ^, or, if more convenient, made redeem- 
able in coin, on demand, without interest. " The great- 
est care," he said, "will, however, be requisite to prevent 
the degradation of such issues into an irredeemable paper 
currency, than which no more certainly fatal expedient 
for impoverishing the masses and discrediting the Gov- 
ernment of any country can well be devised." 

Treasury notes authorized by the acts of June 30, 1812, 
February 24, 1815, and three intervening acts, bore in- 
terest, as recommended by Secretary Gallatin, as has 
been seen, at the rate of 5f per cent, a year, and were 
receivable in payment of all duties and taxes laid by the 
authority of the United States, and for all public lands 
sold by said authority ; and when so received, interest was 
to be computed at the rate of " one cent and one-half a 
cent per day" on every one hundred dollars of principal, 
each month being reckoned as thirty days. It is prob- 
able that the proposition for the issue of the seven-thirty 
notes was obtained from this act, for a substitute was 
proposed for the legal tender act which passed the 
House of Representatives February 6, 1862, which con- 
tained a section providing for the issue of transferable 
certificates bearing interest at the rate of 5| per cent. 
per annum. 

These recommendations of the Secretary w r ere em- 
bodied in the acts of July IT and August 5, 1861. 
The first was passed by nearly the unanimous vote of the 
House, only five votes (one from Kentucky, two from 
Missouri, one from Ohio, and one from Kew York) hav- 
ing been against it. It authorized the Secretary to bor- 


row 250 millions, either in twenty-year treasury notes, 
with interest not exceeding Y per cent., or in seven-thirty 
three-year treasury notes, and to issue demand notes, 
bearing no interest, and receivable for public dues. 
These latter notes were limited to fifty millions, and to 
denominations of not less than ten dollars. But the act 
of August 5th authorized the issue of five-dollar notes ; 
also twenty-year 6 per cent, bonds for the amount pf the 
seven-thirty notes issued, which bonds were to be used 
only in exchange, or for the purpose of funding such 
notes. Under these acts, nearly 140 millions of seven- 
thirty notes were issued, and sixty millions of demand 
notes, without interest ; ten millions of these notes hav- 
ing been authorized by the act of February 12, 1862. 

The first demand notes were issued in August, and 
paid for salaries at "Washington. They were received 
with reluctance, and the merchants and shop-keepers 
endeavored to discredit them. Railroad corporations 
refused them in payment of fares and freight ; and lead- 
ing banks in the city of Kew York refused to receive 
them except on special deposit. The Secretary and 
other officers of the treasury signed a paper agreeing 
to accept them in payment of salaries. A circular was 
issued to the various assistant treasurers, stating that 
treasury notes of the denominations of five, ten, and 
twenty dollars had been, and will continue to be issued, 
redeemable in coin on demand in Boston, New York, 
Philadelphia, St. Louis, and Cincinnati. Gen. Scott 
also issued a circular on September 3, 1861, announcing 
to the army, " that the Treasury Department, to meet 
future payments to the troops, is about to supply, besides 
coin, treasury notes in five, ten, and twenty dollars, as 


good as gold in all banks and Government offices through- 
out the United States, and most convenient for transmis- 
sion bj mail from the officers and men to their families 
at home." Of these notes 824,550,325 were issued 
before December 1st, and $33,460,000 were in circula- 
tion at the time of the suspension of specie payment 
on December 28th. The whole amount authorized was 
issued prior to April 1, 1862. On page 91 is the form 
of the demand note, the size of which was precisely the 
same as the greenback, now in circulation. Notwithstand- 
ing the circular of the Secretary, it became necessary to 
use the available coin in payment of the interest upon 
the public debt, and there was at times some difficulty 
in redeeming the notes promptly in gold. 

At a meeting of the associated banks in the city of 
Xew York, in January, 1862, it was resolved, "That 
before we receive such notes, we must require that such 
legal provision be made by Congress as shall insure their 
speedy redemption, and that a committee of the associa- 
tion be appointed to consider the subject and report on 
it at an adjourned meeting." The notes were receivable 
for duties, and soon obtained good credit. After the 
suspension of specie payment, efforts were made to retire 
them as rapidly as possible, for as they were receivable 
for duties, they embarrassed the Government in provid- 
ing for the gold interest upon the public debt. On 
July 1, 1863, more than fifty-six millions had been re- 
tired, and a much larger amount of legal tender notes 
had been placed in circulation. The demand notes 
were not, by the terms of the law, made payable in gold, 
but as they were authorized prior to the suspension of 
specie payment, and proclaimed as payable in coin by the 


circular of the Secretary, they were considered so pay- 
able, and, after the suspension of specie payment, were 
quoted at times at about the same premium for legal- 
tender notes as gold. 

Interest upon the first issue of the seven-thirty notes 
was paid in gold. These notes were f undable into twenty- 
year 6 per cent, bonds of 1881, and but few were pre- 
sented for payment. The amount redeemed in money 
to November 1, 1864, was only $63,500, while the whole 
amount converted into bonds to that date was $125,864,- 
900. 1 The seven-thirty loan was successfully negotiated 
through the associated banks of New York, who, jointly 
with the banks of Boston and Philadelphia, made a con- 
tract with the Secretary on August 15, 1861, for the 
purchase of Government securities to the amount of 150 
millions, in three different instalments. The total 
amount taken by the New York banks was 105 millions. 
Whenever subscriptions were made, 10 per cent, was 
paid to the Assistant Treasurers in New York, Boston, 
and Philadelphia, and the remainder was placed to the 
credit of the United States on the books of the banks 
subscribing. The arrangement of the associated banks 
among themselves was to issue certificates to each sub- 
scriber, stating the amount so subscribed, and placed to 
the credit of the Government ; and, as such deposits 
were withdrawn, or paid into the treasury, seven-thirty 
notes were issued for the same amount to the subscribers 
respectively. An immediate issue was to be made of 
seven-thirty treasury notes, dated August 15, 1861, to 
the extent of fifty millions, bearing interest from that 

1 Finance Report, 1864, p. 10. 


date. The associated banks were to take jointly this 
amount at par, with the privilege of fifty millions on 
October 15th, and fifty millions on December 15th ; the 
banks giving their decision on the first days of these 
months. It was understood that, if the whole amount 
should be taken, no other Government stock or treasury 
notes, except demand notes, should be negotiated or paid 
out by the treasury until February 1, 1862. The details 
of this negotiation, which was perhaps the most impor- 
tant one during the war, are given in the Banker^ Mag- 
azine for September, 1861, and August, 1862. 

The report of June 12, 1862, of the Loan Committee 
of the Associated Banks of New York, states that, at the 
time the negotiation was made, " the credit of the Gov- 
ernment had become impaired to such a degree that a 
large loan could not be obtained in any ordinary way, 
nor even a small temporary loan, except for a very short 
period at a high rate of interest. Men's hearts failed 
them ; the rebellion was on so large a scale, and had so 
unexpectedly broken out and raged with such fury, that 
to subdue it seemed to most persons to be impossible. 
Then it was, after careful deliberation and consultation 
with the Secretary, that the banks decided it to be wise 
for them to depart from their usual legitimate business, 
and sustain the Government credit, and stand or fall with 
it. This act restored the public confidence, and was the 
highest indorsement of the public credit that could then 
have been given. * * When the banks agreed to 
advance this large amount to the Government, they 
did so without hope or expectation of profit from it, and 
they earnestly sought to obtain from the Government 
the assurance that they should be indemnified from loss. 


It was not until five months after taking the first loan, 
and two months after taking the third, in the month of 
January last, that there was any reason to expect the 
securities to command in the market a price higher 
than that at which they had been taken. * * Much 
doubt was expressed, even by our most experienced bank- 
ers and financiers, when the contract was entered into, 
of the ability of the banks fo fulfil it. It has been ful- 
filled by them to the letter, and has proven of more 
value to the country than can be estimated. As fortu- 
nately as unexpectedly, it has resulted profitably for the 
associates, and has probably enabled them to employ 
their means to nearly as much advantage as would have 
been done but for the political disturbances of. the 

Secretary Chase, in his report for December 9, 1861, 
thus refers to this negotiation : " Representatives from 
the banking institutions of the three cities, responding 
to his invitation, met him for consultation in New York, 
and after full conference, agreed to unite as associates 
in moneyed support to the Government, and to subscribe 
at once a loan of fifty millions of dollars, of which five 
millions were to be paid immediately to the Assistant 
Treasurers, in coin, and the residue, also in coin, as 
needed for disbursement. The Secretary, on his part, 
agreed to issue three-year seven-thirty bonds, or treas- 
ury notes, bearing even date with the subscription, and 
of equal amount ; to cause books of subscription to the 
national loan to be immediately opened ; to reimburse 
the advances of the banks, as far as practicable, from 
this national subscription ; and to deliver to them seven- 
thirty bonds, or treasury notes, for the amount not thus 


reimbursed. It was further understood, that the Secre- 
tary of the Treasury should issue a limited amount of 
United States notes, payable on demand, in aid of the 
operations of the Treasury, and that the associated insti- 
tutions, when the first advance of fifty millions should be 
expended, would, if practicable, make another, and, when 
that should be exhausted, still another advance to the 
Government of the same amount, and on similar terms. 
* * All these objects were happily accomplished. 
Fifty millions of dollars were immediately advanced by 
the banks. The Secretary caused books of subscription 
to be opened throughout the country, and the people 
subscribed freely to the loan. The amounts thus sub- 
scribed were reimbursed to the banks, and the sum re- 
imbursed, though then covering but little more than 
half the amount, enabled those institutions, when a 
second loan was required, to make a second advance of 
850,000,000. Thus, two loans, of $50,000,000 each, 
have been negotiated for three-year seven- thirty bonds, 
at par. The first of these loans was negotiated, and the 
first issue of bonds bears date, August 19, the second 
October 1, 1861." 

On November 16th, a third loan was negotiated with 
the associated institutions, under the seventh section of 
the act of August 5, 1861, the Secretary agreeing to 
issue to them fifty millions of dollars in 6 per cent, 
bonds, at a rate equivalent to par, for bonds bearing 7 
per cent, interest, authorized by the act of July IT, 1861. 

The following table gives quotations of United States 
5 and 6 per cent, bonds, of treasury notes and of gold r at 
the dates stated, compiled from tables in Hunfs Mer- 
chants? Magazine for 1862-63-64. 













February 5 




March 1 
April 1 








Mav 10 
June 7 
July 5 



100 V. 








August 2 








September 6 
October 4 . .. 








November 1 
December 6 








January 3 















March 7 
April 4 . 








May 2 
June 6 






1 Year 

150 * 

July 11 
August 1 
September 5 
October 3. . . . 
November 7. .. . 
November 27. .. . 
January 2 
February 6 
March 5 
April 2. . . 
May 7 
June 4. . . . 
July 11 ... . 
August 6 
September 3 
October 1 
November 5 
December 12 



111 4 






106 y, 

108 % 





100 % 













About three years after the passage of the act author- 
izing the first issue of seven-thirty notes, another act 
was passed, on June 30, 1864, authorizing 200 millions 
of similar notes, and a subsequent act of March 3, 1865, 
authorized 600 millions in addition, and under this act 
the whole amount (including $29,992,500 of reissues), was 


issued. Of this amount forty-four millions were in de- 
nominations of fifty dollars ; 137 millions, in one hun- 
dreds ; 228 millions, in five hundreds ; 370 millions, in one 
thousands ; and about fifty millions, in five thousands. 
They were issued in three series, dated August 15, 1864, 
June 15, 1865, and July 15, 1865. These notes, like 
those that preceded them, were fundable into 6 per 
cent, bonds the former into eighty-ones, and the latter 
into five-twenties and this fact was printed upon the 
reverse of each note. The 800 millions last issued were 
payable, principal and interest, in lawful money. More 
than twenty millions, which were authorized by the act of 
June 20, 1864, were paid to the soldiers direct. Of the 600 
millions, authorized by the act of March 3, 1865, seventy 
millions were issued during that month, and the whole 
remainder was taken during the following four months. 
Secretary McCulloch, in his report for December 4, 
1865, thus refers to the negotiations and issue of the 
remaining 530 millions of these notes: "Upon the 
capture of Richmond, and the surrender of the Confed- 
erate armies, it became apparent that there would be an 
early disbanding of the forces of the United States, and 
consequently heavy requisitions from the War Depart- 
ment for transportation and payment of the army, in- 
cluding bounties. As it was important that these 
requisitions should be promptly met, and especially im- 
portant that not a soldier should remain in the service a 
single day for want of means to pay him, the Secretary 
perceived the necessity of realizing as speedily as pos- 
sible the amount $530,000,000 still authorized to be 
borrowed under this act. The seven and three-tenths 
notes had proved to be a popular loan, and although a 


security on longer time and lower interest would have 
been more advantageous to the Government, the Secre- 
tary considered it advisable, under the circumstances, to 
continue to offer these notes to the public, and to avail 
himself, as his immediate predecessors had done, of the 
services of Jay Cooke, Esq., in the sale of them. The 
result was in the highest degree satisfactory. By the 
admirable skill and energy of the agent, and the hearty 
co-operation of the national banks, these notes were dis- 
tributed in every part of the Northern and some parts of 
the Southern States, and placed within the reach of every 
person desiring to invest in them. No loan ever offered 
in the United States, notwithstanding the large amount 
of Government securities previously taken by the people, 
was so promptly subscribed for as this. Before the 
first of August the entire amount of $530,000,000 had 
been taken, and the Secretary had the unexpected satis- 
faction of being able, with the receipts from customs 
and internal revenue and a small increase of the tem- 
porary lodn, to meet all the requisitions upon the treas- 

On page 101 is the form of the seven-thirty note 
issued under the act of March 3, 1865, with one coupon 

The whole half year's interest \vas payable with the 
note, and there were five coupons upon the right end of 
the note. The size of the note was 3f by 11^ inches, in- 
cluding the coupons, which were 3^- inches in width. On 
the reverse was printed these words : " Pay to bearer. 
At maturity convertible at the option of the holder into 
bonds redeemable at the pleasure of the Government, at 
any time after five years, and payable twenty years from 


July 15, 1868, with interest at 6 per cent, per annum, 
payable semi-annually in coin." 

During the month of July, 1862, gold was at a pre- 
mium for legal tender notes of from 10 to 15 per cent., 
and demand notes, which were receivable for customs, at 
a premium of about 8 per cent. The subsidiary silver 
coinage authorized by the act of February 21, 1853, was 
about 7 per cent, less in intrinsic value than the silver 
dollar, and this difference in weight was authorized, so 
that it Anight be retained in the country for purposes of 
change. This silver coin soon began to disappear. Con- 
siderable amounts were hoarded in the isorth and South, 
and larger amounts were exported to Canada and South 
America ; and a premium of from 10 to 12 per cent, 
was offered for small amounts by business men who de- 
sired it for convenience in making change. Many in- 
dividuals as well as corporations issued small obligations, 
or " shinplasters," such as had been issued in 1812 and 
1837. Postage stamps were used to a considerable ex- 
tent for purposes of change. The Postmaster-General, 
in his report of December, 1862, says: "In the first 
quarter of the current year, ending September 20th, the 
number of stamps issued to postmasters was one hundred 
and four millions; there were calls for about two hun- 
dred millions, which would have been nearly sufficient 
to meet the usual demand for a year. This extraordi- 
nary demand arose from the temporary use of these 
stamps as a currency for the public in lieu of the 
smaller denominations of specie, and ceased with the 
introduction of the so-called ' postal currency.' " 

On July 17, 1862, an act was passed which authorized 
the issue of " postage and other stamps of the United 

Pay .Bearer 1.82tf-100 c/an'y 15i 1868 for tth rtxmonths interest on . , 

Six per cent - r _ 
\ 50 U. S. Treaty Note No. 123,150 F. E. Spinner. 

Gold Option Treas. of the U. 8. "* 

W) UJ. 

' 'S981 P8 ip-tvjf fo vy 

09 O9 


States ;" which were receivable in exchange for United 
States notes, and in payment of all dues to the United 
States, in sums of not less than five dollars. Under this 
law, notes of the denominations of 5, 10, 25 and 50 cents 
were issued, and the denominations of 5 cents wero 
printed on brown tinted paper, with an engraved head of 
Jefferson, which was the exact counterpart of that used 
on the five-cent postage stamp. On the twenty-five- 
cent note the head of Jefferson was five times repeated. 
The form and size of these notes are given on pages 
105-7. The ten-cent note was printed in green, with 
the head of Washington, the counterpart of that used on 
the ten-cent postage stamp. Upon the fifty-cent note 
this vignette was five times repeated. The form and size 
of the ten-cent and fifty-cent notes are given on pages 
106-8. These notes were issued in the month of August, 
1862, and were termed " postage currency," and continued 
in use until they were replaced by the fractional currency 
authorized by section four of the act of March 3, 1863. 
The previous act prohibited private corporations, bank- 
ing associations, and individuals from issuing or circulat- 
ing notes for fractions of a dollar, and imposed a pen- 
alty, upon conviction, of a fine not exceeding five 
hundred dollars, and imprisonment not exceeding six 
months. The law did not prohibit the issue of frac- 
tional currency by cities, and considerable amounts were 
placed in circulation by various municipalities, notwith- 
standing that in many of the States, laws had been 
passed in the year 1837, or prior thereto, prohibiting 
such issues. 

The amount of fractional currency was limited to 
fifty millions of dollars, and denominations of from. 


three cents to fifty cents were issued, which were ex- 
changeable for United States notes in sums of not less than 
three dollars. On the days on which this small currency 
was first issued to the public, the offices of the Assistant 
Treasurer in Xew York and in other cities were thronged 
with long lines of people anxious to obtain this paper 
currency to supply the deficiency caused by the with- 
drawal of silver coin. On account of the scarcity of one 
and two-dollar notes and of fractional currency, whole 
sheets of these notes, when they were first issued, were 
paid to the army, and subsequently were so cut that 
four 25-cent notes were used in place of a one-dollar 
note, and four fifty-cent notes in place of a two dollar 
note, and in this form considerable amounts were paid 
out. These notes were universally used for small change 
in and out of the army. The total issue of " postage cur- 
rency," which commenced August 21, 1862, and ceased 
May 27, 1863, was $20,215,635. $4,282,082 was out- 
standing on April 1, 1884, of which $1,028,332 was in de- 
nominations of five cents ; $.L, 243,974 in ten cents ; $1,- 
039,203 in twenty-five cents, and $970,572 in denomina- 
tions of fifty cents. The total amount of issues and 
reissues under both acts was $368,720,074. These little 
notes were stuffed in the trowsers pocket of the soldier, 
with the jack-knife, the cartridge, the plug of tobacco, 
and other handy articles, and soon became unfit for cir- 
culation. They wore out rapidly and became ragged and 
filthy, and were frequently returned for redemption. 

The first issues under the act of March 3 commenced 
on October 10, 1863, and ceased on February 15, 1876 ; 
and an act was passed on April 17th, of the latter year, 
directing the Secretary to replace this circulation by the 



Furnished only by the Assistant 
Treasurers and Designated Depositaries of the U. S. 


5 5 

U.S. Postage 


Five Oenta 
U. S. 




Treasurer or 
Depositary in . 


By any Assistant \ 
designated U. S. 
sums not less than 

Receivable in O -JPJ payment of all 
dues to the U. States less that 




Treasurers and D 

ted only by the Assistant 
esignated Depositaries of the U. S. 

10 10 

~\ r\ 

U. S. Postage 

, r-\ 

4>i &. 


"1 ] ] 1" 

1 U 

Ten Dents 

i. w 

U. S. 






Treasurer or 
Depositary in 

V\\lt &OUARS. 
payment of all 

By any Assistant 

designated U. S. 

sums not less tha n 

Receivable in 

duet to the U. States less th 



Furnished only by the Assistant 
Treasurers and Designated Depositaries of the U. S. 



5 5 

U. S. Postage 

Five Cents 

U. S. 

U.S. I 

five times. 




Designated U. 
sums not l 

Receivable in 
dues to the U. States le 

Treasurer or 

edU.S. ) ^L Deposit, 
'ess than ^j ^J y\\jt OC 

CT APPROVED, JULY 17, 1882. 




Furnished only by the Assistant 
Treasurer* and Designated Depositaries of the U. S. 


10 io[j 


U.S. Postage j 





five times. 

Ten Cents jj 

[U. S.jj 





By any Assistant 

designated U. S. 

sums not less than 

Receivable in 


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Depositary in 

payment of all 

dues to the U. States less th 



issue of subsidiary silver coin. The fractional paper 
currency was issued in five different series. The high- 
est amount outstanding at any one time was less than fifty 
millions. The amount outstanding on January 1, 1885, 
was $15,347,277. A considerable amount is still held 
by banks and bankers, which is grudgingly paid out to 
those customers who desire it for purposes of remittance 
by letter. The principal portion of the amount out- 
standing will probably never be presented for redemp- 
tion. The proportion of loss to the people from this 
fractional currency is vastly greater than that of any 
other kind of circulation ever issued in this country, and 
this loss, in a large measure, must be attributed to the small 
value of the notes and the many casualties of the war. 
The proportion of legal tender notes and national bank 
notes, of the highest amount outstanding at any one time, 
not presented for redemption, or lost, in the course of 
twenty years, is estimated at about 1% per cent. 

Authority was given by the second section of the act 
of March 3, 1863, to issue 400 millions of treasury 
notes, bearing interest at a rate not exceeding six per 
cent, in lawful money for a term not exceeding three, 
years, payable at periods expressed on their face, and in, 
denominations of not less than ten dollars. These notes 
were exchangeable, together with the accumulated in? 
terest. for treasury notes not bearing interest. They 
were made legal tender for their face value, excluding 
interest. Power was also given to the Secretary to issue 
150 millions of additional greenbacks, which were to be 
issued only in exchange for these interest-bearing notes. 
Under this act, $44,520,000 notes were issued, redeem- 
able one year from date, and, $166j480jOOO two years 


from date, bearing interest at 5 per cent, per annum., 
which were known as " one and two year notes of 1863." 
Authority was given by the act of June 30, 1864, for 
the issue of 200 millions of treasury notes in denomina- 
tions of not less than ten dollars, not exceeding three 
years, and bearing interest not exceeding 7.30 per cent. 
per annum, interest payable semi-annually, principal and 
interest to be paid in lawful money. The notes were 
to be a legal tender for their face value. Xo seven- 
thirty notes were issued under this act, but, in lieu there- 
of, $266,595,440 of compound interest notes were issued. 
The act did not authorize in terms the issue of compound 
interest notes, but as the interest at six per cent, com- 
pounded, would be considerably less than at 7.30 per cent, 
simple interest, their issue was not in conflict with the 
terms of the act. The notes were of the form shown on 
pages 111-112. The size of these notes was 3^ by 7|- 
inches. Of these notes, $177,045,770 were issued in re- 
demption of the one and two year five per cent, notes, 
and it is not probable that more than 200 millions of 
these notes were outstanding at any one time. Secre- 
tary Fessenden, in his report for December 6, 1864, 
thus refers to the issue of these notes : " The whole 
amount of national circulation, not bearing interest, ex- 
clusive of fractional currency, and of notes issued by 
national banks, is limited to four hundred millions of 
dollars, subject to slight occasional increase from the fifty 
millions held in reserve for the payment of temporary 
deposits. Of five per cent, interest-bearing notes there 
were outstanding, on the first of November last, $120,- 
519,110. To a considerable extent these notes have been, 
and will continue to be, used as currency. Those with 




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coupons have been found particularly objectionable, as, 
though withdrawn to a certain extent while the interest 
is maturing, they are liable to be periodically rushed 
upon the market. In consideration of this feature, a 
l.vrge amount, viz., about ninety millions of the original 
issue of one hundred and fifty millions of these coupon 
notes, have been withdrawn and destroyed, and their 
place occupied by notes payable in three years, bearing 
interest at six per centum, compounded semi-annually. 
This is believed to be the best form of interest-bearing 
legal-tender notes, as being more likely to be withdrawn 
and held until maturity, as an investment. Of these, 
fifteen millions in amount were issued under the act of 
March 3, 1863, and about ninety millions under the act 
of June 30, 1864. The total amount of interest-bearing 
notes outstanding on the 22d of JSTovember last was 8210,- 
222,870. What proportion of these maybe considered as 
an addition to the circulation I am unable to determine. 
To that extent, whatever it may be, they contribute to 
the amount of the currency, and thus in some degree 
occasion, and in still greater degree sustain, an increase 
of prices, and depress values." 

About two years and eight months after the passage 
of the last act, authority was given for the issue of tem- 
porary loan 3 per cent, certificates, for the purpose of 
retiring the compound interest notes. When these latter 
notes were issued, it was expected that they would, as the 
interest accumulated, soon pass out of circulation into the 
hands of bankers and capitalists. These expectations 
were realized, for the interest was only payable at ma- 
turity, three years from date. Such notes, with accrued 
interest, would not be paid out by the 1 holders except in 


cases of absolute necessity. In order to insure the re- 
tirement of these notes, " An act to provide ways and 
means for the payment of compound interest notes," 
was passed on March 2, 1867. This act authorized the 
issue of 3 per cent, certificates in denominations of not 
less than $100, payable on demand. The national banks 
\yere authorized to hold these certificates as a part of 
their reserve, provided that not less than two-fifths of 
the entire reserve should consist of lawful money of the 
United States. This privilege did not largely diminish 
the amount of gold coin and greenbacks which the 
banks were required continually to keep on hand, as 
most of the banks held a large amount of cash reserve, 
in addition to the amount required by law. This excess 
could with great profit be invested in the new certifi- 
cates, and they could be used to advantage for clearing- 
house purposes, and the banks at once availed them- 
selves of this privilege. The amount authorized by this 
act was fifty millions, which was increased to seventy- 
five millions by the act of July 25, 1868. These certifi- 
cates were payable on demand, and redeemable at the 
pleasure of the Government ; they were chiefly issued 
during the fiscal year 1868 and 1869, and for the most 
part retired in the fiscal years from 1869 to 1873 
$12,195,000 being retired during the latter year. 

The act of July 12, 1870, authorized the issue of $54,- 
000,000 additional bank circulation, and section two of 
that act provided that, at the end of each month after 
the passage of this act, the Comptroller of the Currency 
should report the amount of such circulating notes issued, 
whereupon the Secretary of the Treasury should redeem 
and cancel a like amount of 3 per cent, certificates ; and 


in order to retire such certificates he was authorized to 
give notice to the holders, designating the number, date 
and amount, that such certificates shall cease to bear 
interest and be available for reserve, from and after the 
day designated in the notice. 

Thus it will be seen that the compound interest notes 
were issued for the purpose of retiring 5 per cent, notes, 
the 3 per cent, certificates for the retirement of the com- 
pounds which were maturing, and the act of July 12, 
1870, was passed in turn for the retirement of the 3 per 
cents; and the different acts authorizing these issues had 
the effect of rapidly accomplishing these results, with but 
little inconvenience either to the banks or to the public. 

The act of March 3, 1863, authorized the issue of gold 
certificates, of one and two-year notes, and of compound 
interest notes ; and certificates under the fifth section of 
that act were used for clearing-house purposes soon after 
the passage of the national bank act. They were au- 
thorized to be issued in sums of not less than $20, cor- 
responding with the denomination of United States 
notes. The coin and bullion deposited were required to 
be retained in the treasury for the payment of the same 
on demand. Certificates representing coin in the treas- 
ury were authorized to be issued in payment of interest 
on the public debt, but it was provided that the amount of 
certificates issued should not, at any one time, exceed 20 
per centum beyond the amount of coin and bullion in 
the treasury. These certificates were authorized to be 
received at par in payment of duties. The first issue 
was made on November 13, 1865. On June 30, 1875, 
there were outstanding $21,796,300, of which the na- 
tional banks in New York City held $12,642,180. 


Their issue Avas discontinued on December 1, 1878, just 
previous to the resumption of specie payments, and the 
amount outstanding had decreased on June 30, 1879, to 
15,413,700. The amount outstanding on October 3, 

1883, was $4,907,440, of which the national banks held 
84.594,300. On January 1, 1883, the amount outstand- 
ing was $3,568,840. Most of these certificates were is- 
sued for clearing-house purposes, in denominations of 
$1,000, $5,000, and $10,000. 

On June 8, 1872, an act was passed authorizing the 
Secretary of the Treasury to receive United States notes 
on deposit without interest from national bank associa- 
tions, in sums not less than $10,000, and issue certifi- 
cates therefor, of denominations not less than $5. our. 
These certificates were similar to the 3 per cent, cer- 
tificates just referred to, except that they bore no in- 
terest, and were largely used in place thereof for clear- 
ing-house purposes. The certificates were payable on 
demand in United States notes at the place of issue, 
and they were authorized to be held and counted by 
national banks as part of their legal reserve, and to bo 
used in settlement of clearing-house balances. These 
certificates were not properly treasury notes, and the 
highest amount issued was $64,780,000, on August 3, 
1875, which amount was rapidly reduced after the re- 
sumption of specie payments. On June 30, 1875, there 
were outstanding $59,045,000, of which the national 
banks held $47,310,000. On June 30, 1876. the amount 
outstanding was $33,140,000, of which the banks held 
$27,955. The amount outstanding on September 30, 

1884, was $15,945,000, of which the banks held on the 
same date, $14,200,000. 


The act of February 26, 1879, authorized the issue 
of 4 per cent, certificates, of the denomination of $10, 
which were convertible at any time, with accrued in- 
terest, into the 4= per cent, bonds authorized to be issued 
July 14, 1870. This act was passed for the purpose of 
facilitating the refunding of 5 and 6 per cent, bonds 
then falling due into 4 per cents, but the act was really 
unnecessary, for about the time the certificates began to 
be issued, the 4 per cent, bonds were above par in the 
market. Long lines of people gathered at the different 
Government depositories where the certificates were 
offered, and the amount was taken as fast as they could 
be furnished. $40 012,750 were disposed of at par, of 
which $39,398,110 were issued during the fourth quarter 
of the fiscal year 1879, and the amount outstanding on 
January 1, 1885, was $260,000. 

The table on page 118 exhibits the amount of treasury 
notes of the different forms issued during the late civil 
war, outstanding on January 1, 1885, interest upon all 
of which has long since ceased. 

" An act to authorize the issue of United States notes, 
and for the redemption or funding thereof, and for re- 
funding the floating debt of the United States," which 
was signed by President Lincoln on February 25, 
1862, is the first law ever placed upon the statute books 
making treasury notes, or anything but gold and silver 
coin, a tender in payment of debts. Indeed, it may be 
said that neither the Congress of the United States nor 
the Continental Congress, which preceded it, issued any 
form of legal tender treasury notes. The Continental Con- 
gress had no power to enact such a law. It did, however, 
pass a resolution, on January 4, 1777, recommending to 





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the legislatures of the different States to pass laws mak- 
ing the bills of credit issued by Congress a lawful tender 
in payment of public and private debts, and a refusal 
thereof an extinguishment of such debts ; that debts 
payable in sterling money be discharged in continental 
dollars at the rate of 43.6 sterling per dollar ; and that 
in the discharge of all other debts and contracts, conti- 
nental dollars shall pass at the rate fixed by the respect- 
ive States for the value of Spanish milled dollars. In 
accordance with the recommendation contained in these 
resolutions, continental paper money was made a legal 
tender in Connecticut, Massachusetts, Rhode Island, and 
New Jersey in 1776, and in Pennsylvania, Delaware, 
Maryland, and Virginia in 1777. 

The legal tender act was passed during the second ses- 
sion of the 32d Congress, which met December 2, 1861. 
The report of the Secretary of the Treasury bears date 
December 9th. The third instalment of fifty millions, 
of the loan of 150 millions already referred to, had been 
negotiated on the 16th of November previous, with the 
associated banks. The Secretary was hopeful that the 
war would be brought to an auspicious termination be- 
fore midsummer, but at the same time submitted esti- 
mates based upon its continuance. In this event, it was 
estimated that the public debt, which, on July 1, 1861, 
was 890,867,828, would be on July 1, 1862, 517 millions, 
and on July 1st of the following year, 897 millions. He 
recommended the issue of circulating notes in place of 
the existing bank-note circulation, which depended " on 
the laws of thirty-four States, and the character of some 
sixteen hundred private corporations." 

Two plans for effecting this object were suggested ; 


the first was the withdrawal of the bank circulation, 
and the issue of United States notes instead thereof, pay- 
able in coin on demand ; the second contemplated the 
delivery to banks of notes prepared for circulation un- 
der national direction, and to secure prompt convertibil- 
ity into coin by the pledge of United States bonds, and 
other needful regulations. Both of these plans were 
discussed at considerable length in the report, the pref- 
erence of the Secretary being decidedly in favor of the 
issue of bank notes. The avails of the large loan made 
from the banks were not allowed to remain on deposit, 
to be drawn by checks as the necessities of the Gov- 
ernment should require, but were, from time to time, 
paid into the treasury, so that it was quite difficult for 
some of the banks to meet the last instalment. The 
banks were in danger of suspending specie payment at 
the time of the meeting of Congress. Suspension finally 
took place on December 28, 1861, and two days later, 
on the 30th, Mr. Spaulding, of the sub-committee of the 
Committee of Ways and Means, introduced the legal 
tender bill. 

A national bank bill had been prepared previously, and 
when nearly completed, Mr. Hooper, of Massachusetts, 
also of the sub-committee, incorporated in it several pro- 
visions contained in a recent free-banking bill, which had 
passed the Legislature of his own State. Two hundred 
copies of this bill, which was hastily prepared late in the 
month of December, were printed for the use of the 
Committee of Ways and Means, and a copy of this bill, 
which was the basis of the national bank act, which be- 
came a law about a year afterward, is in the possession 
of the writer. It being evident that the bank bill would 


encounter considerable opposition from the friends of 
banks organized under State laws, and that great delay 
would necessarily occur from the consideration of an 
elaborate bank bill of sixty or more sections, arranged 
for the organization of banks in the different States of 
the Union, the bill was laid aside, and the bill authoriz- 
ing the issue of legal tender notes was considered. 

An informal letter was read to the Committee from 
Attorney-General Bates, in which he gave it as his 
opinion that Congress had not only the right to issue 
such bills of credit, but also to make them a legal 
tender. Discussion of the bill continued for several 
days, and upon a vote being taken, it was found that 
the Committee was equally divided, but by the change 
of a vote it was finally reported to the House on July 7, 
1862, and published in the leading New York news- 
papers. Only two daily newspapers favored the meas- 
ure, and it is said that other newspapers, which were 
bitterly hostile, were for a time excluded from the 
privilege of the mails. The leading financial magazine 
ridiculed and denounced the plans of the Secretary and 
of Congress in its monthly issues, and at one time de- 
clared that " the financial fabric of the Union totters 
to its base ! " Delegates from ten of the principal banks 
in the three leading cities appeared in Washington and 
opposed the bill. The bill was afterward submitted to 
the Secretary of the Treasury by the Committee, and, 
upon its return with his suggestions, was reported to the 
House on January 22, 1862, with the title above given, 
as a substitute for the previous bill. The bill passed the 
House on February 6, 1862, by a vote of 93 to 59. There 
were no democratic votes in favor of the bill, and among 


the nays were : Merrill, of Yermont ; Conkling and 
Pomeroy, of Xew York ; Porter, of Indiana ; Lovejoy, 
of Illinois ; Thomas, of Massachusetts ; Rollins, of Xew 
Hampshire, and other leading Republicans. The chief 
amendments in the Senate were : requiring payment of 
interest semi-annually in coin on bonds and seven-thirty 
notes ; conferring on the Secretary power to sell 6 per 
cent, bonds at the market value thereof for coin ; making 
the bonds redeemable in five years and payable in twenty 
years from date at the option of the Government, and 
authorizing temporary deposits in the treasury at 6 per 

There was considerable debate in both Houses upon the 
question of the right of the Government to issue demand 
notes, and the arguments were not unlike those which 
have already been given in previous debates in Congress. 
The principal discussion was, however, upon the consti- 
tutional right of Congress to make these notes a legal 

Secretary Chase, afterward Chief Justice, in a letter 
to the Committee of Ways and Means on January 29, 
1862, says: "It is not unknown to the Committee that 
I have felt, nor do I wish to conceal that I now feel, a 
great aversion to making anything but coin a legal ten- 
der in payment of debts. It has been my anxious wish 
to avoid the necessity of such legislation. It is, how- 
ever, at present impossible, in consequence of the large 
expenditures entailed by the war, and the suspension of 
the banks, to procure sufficient coin for disbursement ; 
arid it has, therefore, become indispensably necessary 
that we should resort to the issue of United States notes. 
The making them a legal tender might, however, still 


be avoided, if the willingness manifested by the people 
generally, by railroad companies, and by many of the 
banking institutions, to receive and pay them as money 
in all transactions, were absolutely or practically univer- 
sal ; but, unfortunately, there are some persons and 
some institutions which refuse to receive and pay them, 
and whose action tends, not merely to the unnecessary 
depreciation of the notes, but to establish discrimina- 
tions in business against those who, in this matter, give 
a cordial support to the Government, and in favor of 
those who do not. Such discriminations should, if pos- 
sible, be prevented ; and the provision making the notes 
a legal tender, in a great measure at least, prevents it, 
by putting all citizens in this respect on the same level, 
both of rights and duties. 

" The Committee, doubtless, feel the necessity of ac- 
companying this measure by legislation necessary to se- 
cure the highest credit, as well as the largest currency 
of these notes. This security can be found, in my judg- 
ment, by proper provisions for funding them in interest- 
bearing bonds ; by well-guarded legislation authorizing 
banking associations with circulation based on the bonds 
in which the notes are funded ; and by a judicious sys- 
tem of adequate taxation, which will not only create a 
demand for the notes, but by securing the prompt pay- 
ment of interest raise and sustain the credit of the 
bonds. Such legislation, it may be hoped, will divest 
the legal tender clause of the bill of injurious tenden- 
cies, and secure the earliest possible return to a sound 
currency of coin and promptly convertible notes." 

From the introduction of the bill in Congress on De- 
cember 30, 1861, to its final approval on February 25, 


1862, a period of eight weeks, it was thoroughly dis- 
cussed both in Congress and throughout the country. 
More than twenty members of the House participated 
in the debate. Messrs. Spaulding, Hooper, Alley, Kel- 
logg, Campbell, Hickman, and Stevens were the most 
prominent speakers in favor of the measure. Messrs. 
Pendleton, Yallandigham, Morrill, Conkling, Wright, 
and Lovejoy opposed it. Mr. Spaulding made the 
speech introducing the bill. He said : " The bill before 
us is a war measure, a measure of necessity, and not of 
choice, presented by the Committee of Ways and Means 
to meet the most pressing demands upon the treasury 
to sustain the army and navy, until they can make a 
vigorous advance upon the traitors, and crush out the 
rebellion. These are extraordinary times, and extraor- 
dinary measures must be resorted to in order to save 
our Government, and preserve our nationality." 

In the course of the discussion the following extract 
from a letter just received by Mr. Spaulding from the 
Secretary of the Treasury was read : " Immediate action 
is of great importance. The treasury is nearly empty. 
I have been obliged to draw for the last instalment of 
the November loan. So soon as it is paid, I fear the 
banks generally will refuse to receive the United States 
notes, unless made a legal tender. You will see the 
necessity of urging the bill through without more delay." 

The influences which seemed to render it necessary 
that the notes authorized to be issued by the bill should 
be declared a legal tender, is shown, not only by the let- 
ters of the Secretary but by the debate which followed. 

Mr. Hooper said : " The unusual exigencies of the 
country require that we should look for other and deeper 


sources of revenue than any to which we have heretofore 
been accustomed. We are contending for maintenance 
of the Government, the preservation of the Union, and 
for the enforcement of the laws." 

Mr. Alley said : " Beneficent as this measure is, as 
one of relief, nothing could induce me to give it sanc- 
tion but uncontrollable necessity. * * There can be 
no more issues than the real necessities of the Govern- 
ment require. The Government cannot make issues, 
like the banks, for profit. * * Its issues must neces- 
sarily be limited to its absolute wants." 

On the same point Mr. Kellogg said : " If this ques- 
tion came up in ordinary times, I am frank to confess 
that I might, perhaps, have had some doubt of its con- 
stitutionality sufficient to induce me to oppose it. I 
mean by that only to say that in time of peace, when the 
integrity of the Government is not threatened, I would 
be more careful and cautious ; and if I doubted the con- 
stitutionality of the measure I would not vote for it. 
But, sir, in this our extremity, while we are struggling 
to perpetuate our Government, I am willing to go to the 
very verge of the Constitution. I treat this, Mr. Chair- 
man, as emphatically and clearly a war measure." 

Mr. Blake argued that it was constitutional to issue 
treasury notes and make them a legal tender. He in- 
sisted that it was a necessary and proper means of carry- 
ing into effect the war powers to raise and support 
armies, and to provide and maintain a navy. We are 
now in the midst of a great national exigency, and one, 
too, that we must provide for ; and one that in the appli- 
cation of the means there must of necessity be great lati- 
tude of discretion. 


Mr. Campbell remarked : " The bill now before the 
Committee is necessary to sustain the credit of the coun- 
try, and to carry on the war. It is with reluctance that 
I have come to this conclusion. I do not like the neces- 
sity which exists for the legal tender clause ; still less 
do I like to place the issues of the Government in the 
hands of the brokers and money-lenders of the country. 
Depreciated now, let the legal tender clause fail, and 
mark the result to-morrow. The treasury notes will fall 
from 4 per cent, to 15 and 25 below par, and the Gov- 
ernment will have to pay that percentage additional for 
every article they purchase." 

Mr. Ilickman, of Pennsylvania, on the same side, 
said : " I am disposed to waive the question of propriety 
or expediency, and to vote for it as a necessity." 

Mr. Stevens, who closed the debate, said : " This bill 
is a measure of necessity, not of choice. ISTo one would 
willingly issue paper currency not redeemable on de- 
mand, and make it a legal tender. It is never desirable 
to depart from the circulating medium which, by the 
common consent of civilized nations, forms the standard 
value. But it is not a fearful measure, and when ren- 
dered necessary by exigencies it ought to produce no 

He argued in favor of the constitutionality of the 
legal tender clause, and that it was a necessary and 
proper measure at this time. " In short, whenever any 
law is necessary and proper to carry into execution any 
delegated power, such law is valid. That necessity need 
not be absolute, inevitable, and overwhelming if it be 
useful, expedient, profitable, the necessity is within the 
constitutional meaning. Whether such necessity exists 


is solely for the decision of Congress. Their judgment 
is absolute and conclusive. If Congress should decide 
this measure to be necessary to a granted power, no de- 
partment of the Government can rejudge it. The Su- 
preme Court might think the judgment of Congress 
erroneous, but they could not review it. * * Our 
proposition is to issue United States notes, secured at the 
end of twenty years to be paid in coin, and the interest 
raised by taxation semi-annually ; such notes to be 
money, and of uniform value throughout the Union. 
I look upon the immediate passage of the bill as es- 
sential to the very existence of the Government. Reject 
it, and the financial credit, not only of the Government, 
but of all the great interests of the country, will be 
prostrated. Mr. Chairman, let me say in conclusion, 
that unless this bill is to pass with the legal tender 
clause in it, it is not desirable to its friends, or to the 
Administration, that it should pass at all ; and those 
who think as I do will have to vote against it, if it 
should be thus mutilated and emasculated. If it is to 
be defeated, I should be glad if we had the power which 
they have m the British Parliament to resign our 
places on the Committee of Ways and Means, and leave 
it to those who oppose this bill to mature some other 
measure. So far as I am concerned, I shall be modest 
enough not to attempt any other scheme. The Com- 
mittee of Ways and Means have labored in the prepara- 
tion of this measure anxiously, and to the best of their 
poor abilities. We are not infallible. We do not come 
near it. I am but poorly qualified for anything of this 
kind. But we have given it our most anxious consider- 
ation, and have consulted those whom we believed to 


be the best qualified to advise us. We have sought to 
harmonize conflicting views in the substitute which the 
majority of the Committee have prepared, and we hope 
it will pass. We. believe that the credit of the country 
will be sustained by it, that under it all classes will be 
paid in money which all classes can use, and that it 
will confer no advantage on the capitalist over the poor 
laboring man." 

The following extracts from the speeches of those op- 
posed to the bill will indicate the drift of their argu- 
ments. Mr. Pendleton said : " These notes are to be 
made lawful money, and a legal tender in discharge of 
all pecuniary obligations, either by the Government or 
individuals, a character which has never been given to 
any note of the United States, or any note of the Bank 
of the United States, by any law ever passed. Not only, 
sir, was such a law never passed, but such a law was 
never voted on, never proposed, never introduced, never 
recommended by any department of the Government ; 
the measure was never seriously entertained in debate 
in either branch of Congress." He contended that the 
bill, if passed, would impair the obligation of past as 
well as of future contracts, and that it would make it il- 
legal to make a contract for dealing in gold or silver 
coin, for the reason that these legal tender notes might 
be tendered in payment of coin contracts ; and added : 
"When I come to examine the powers of Congress ac- 
cording to the principles of interpretation to which I ad- 
here, I look to the grants of the Constitution. I find 
no grant of this power in direct terms, or, as I think, by 
fair implication. It is not an accidental omission ; it is 
not an omission through inadvertency. It was inten- 


tionally left out of the Constitution, because it was de- 
signed that the power should not reside in the Federal 

Mr. Yallandigham denied the right of the Federal 
Government to provide a paper currency, intended 
primarily to circulate as money, and meet the demands 
of business and commercial transactions, and to the ex- 
clusion of all other paper. It is not the intent or object 
of the substitute to furnish such a currency for the coun- 
try. He said : " THE SHIP OF STATE is UPON THE ROCKS. 
I was not the helmsman who drove her there ; nor had 
I part or lot in directing her course." 

Mr. Merrill protested " against making anything a legal 
tender but gold and silver, as calculated to undermine all 
confidence in the Republic, whose reputation should be 
dearer to statesmen, as well as to soldiers, than life itself." 

Mr. Conkling assigned his reasons for voting against 
the attempt to make paper a legal tender as follows : 
" The proposition is a new one. ~No precedent can be 
urged in its favor ; no suggestion of the existence of 
such a power can be found in the legislative history of 
the country ; and I submit to my colleague, as a lawyer, 
the proposition that this amounts to affirmative author- 
ity of the highest kind against it. Had such a power 
lurked in the Constitution, as construed by those who 
ordained and administered it, we, should find it so re- 
corded. The occasion for resorting to it, or at least re- 
ferring to it, has, we know, repeatedly arisen ; and had 
such a power existed, it would have been recognized and 
acted on. It is hardly too much to say, therefore, that 
the uniform and universal judgment of statesmen, jur- 
ists, and lawyers has denied the constitutional right of 


Congress to make paper a legal tender for debts to any 
extent whatever. But more is claimed here than the 
right to create a legal tender heretofore unknown. The 
provision is not confined to transactions in future, but is 
retroactive in its scope. It reaches back and strikes at 
every existing pecuniary obligation." And he added : 
" I believe all the money needed can be provided in sea- 
son by means of unquestionable legality and safety. 
The substitute I have offered will, I believe, without 
essential alteration, effect that result." 

Mr. Wright thought that " the people had means 
enough in their possession, and he was willing to go for 
taxation to the uttermost limit; but the time had not yet 
arrived when we should resort to such an extreme meas- 
ure as to make these notes a legal tender." 

Mr. Lovejoy held " that no respectable argument could 
be made in vindication of the constitutionality of this 
bill. He would admit the plea of necessity if he be- 
lieved it ; and he thought it more manly to confess it, 
as Jefferson did, than to attempt to torture the Consti- 
tution into the support of a measure which everybody 
must see to be unconstitutional." 

The bill passed the House on February 6th, by a vote 
of 93 to 59. It was sent to the Senate on February 
7th. Mr. Fessenden, Chairman of the Finance Com- 
mittee, obtained unanimous consent to consider the sub- 
ject forthwith, and read a letter from the Secretary of 
the Treasury of which the following is an extract : 
" The condition of the treasury requires immediate legis- 
lative provision." 

Mr. Fessenden opened the debate. He proposed to 
state briefly the arguments on both sides without either 


favoring or opposing the measure. He said : " The 
ground upon which this clause making these notes a 
legal tender is put, I have already stated. It is put 
upon the ground of absolute, overwhelming necessity ; 
that the Government has now arrived at that point 
where it must have funds, and those funds are not to be 
obtained from ordinary sources, or from any of the ex- 
pedients to which we have heretofore had recourse, and 
therefore, this new, anomalous, and remarkable provi- 
sion must be resorted to in order to enable the Govern- 
ment to pay off the debt that it now owes, and afford 
circulation which will be available for other purposes. 
The question then is, does the necessity exist ? " He 
did not hesitate to say that he " would advocate the use 
of the strong arm of the Government to any extent in 
order to accomplish the purpose in which we are engaged. 
He would take the money of any citizen against his will 
to sustain the Government, if nothing else was left, and 
bid him wait until the Government could pay him. It 
is a contribution which every man is bound to make under 
the circumstances. We can take all the property of any 
citizen. That is what is called a forced contribution. 
* * The question after all returns : Is this measure 
absolutely indispensable to procure means ? If so, as I 
said before, necessity knows no law. Say what you 
will, nobody can deny that it is bad faith. If it be 
necessary for the salvation of the Government, all con- 
siderations of this kind must yield ; but to make the 
best of it, it is bad faith, and encourages bad morality, 
both in public and private. Going to the extent that it 
does, to say that notes thus issued shall be receivable in 
payment of all private obligations, however contracted, 


is in its very essence a wrong, for it compels one man 
to take from his neighbor, in payment of a debt, that 
which he would not otherwise receive or be obliged to 
receive, and what is probably not full payment." 

Mr. Collamer made an elaborate speech against the 
legal-tender clause in the bill. He argued that it was 
unconstitutional, and that even if it was a necessity, he 
could not vote for the measure. His honest opinion was 
that the Constitution never intended to invest Congress 
with any such power. He referred to the debates in 
the convention that formed the Constitution, to show 
that " the men of that period always entertained the 
opinion that the United States could have nothing else 
a tender but coin. While they lived there never was 
such a thing thought of as attempting to make the evi- 
dences of the debt of the Government a legal tender, 
let their form be what they might." He argued that 
there was an express power " to borrow money on the 
credit of the United States. That where there is an 
express power to do a thing, there can be no implied 
power to do the same thing. There were two modes of 
replenishing the treasury. One was by taxation, and 
the other to borrow money. To borrow money there 
must be a lender and a borrower ; and both should act 
voluntarily, and not compel the lender to part with his 
money without an inducement. The operation of this 
bill was not anything like as honorable or honest as a 
forced loan." 

Mr. Sherman spoke in favor of the legal-tender clause, 
and in regard to its necessity said : " Every organ of 
financial opinion " referring to the action of the Cham- 
bers of Commerce in the principal cities " if that is a 


correct expression in this country agrees that there is 
such a necessity, in case we authorize the issue of de- 
mand notes. * * Our arguments must be submitted 
finally to the arbitration of the courts of the United 
States. When I feel so strongly the necessity of this 
measure, I am constrained to assume the power, and re- 
fer our authority to exercise it to the courts. I have 
shown, in reply to the argument of the Senator from 
Maine, that we must no longer hesitate as to the neces- 
sity of this measure. That necessity does exist, and now 
presses upon us." He thought himself required " to 
vote for all laws necessary and proper for executing 
these high powers, and to accomplish that purpose. 
This is not the time when I would limit these powers. 
Rather than yield to revolutionary force, I would use re- 
volutionary force." 

Mr. Howe said : " Congress is also clothed with power 
' to make all laws which shall be necessary and proper 
for carrying into execution the foregoing powers, and 
all other powers vested by this Constitution in the Gov- 
ernment of the United States.' Those who deny the 
constitutional authority to pass this bill must deny its 
necessity or its propriety. Those who deny its necessity 
or its propriety ought to show us some plan for avoid- 
ing it, some measure adequate to the emergency, and 
more proper than the one proposed by this bill. Two 
months have elapsed since the policy of this bill has 
been discussed, and no one of its opponents has yet pro- 
duced a substitute. The total neglect to offer a substi- 
tute isprimafaeie evidence of the necessity for this." 

Mr. Bayard said : " No one can deny the fact that in 
contracts between man and man, and in government 


contracts to pay money, the obligation is to pay intrin- 
sic value. If you violate that by this bill, which you 
certainly do, how can you expect that the faith of the 
community will be given to the law which you now pass, 
in which you say that you will pay hereafter the interest 
on your debt in coin ? Why should they give credit to 
that declaration ? If you can violate the Constitution of 
the United States in the face of your oaths, in the face 
of its palpable provision, what security do you offer to 
the lender of money ? " 

Mr. Sumner argued, in the present existing state of the 
country, for the constitutionality and expediency of the 
legal-tender clause. He quoted from Mr. Justice Story 
" that all these prohibitory clauses as to coining money, 
emitting bills of credit, and tendering anything but gold 
and silver in payment of debts, are founded upon the 
same general considerations. The policy is to provide 
a fixed and uniform rule throughout the United States, 
by which commercial and other dealings of the citizens, 
as well as the moneyed transactions of the Government, 
might be adjusted" (2 Story's Com., Sec. 1372). 

" If this view be correct, then no inference adverse to 
the powers of the National Government can be drawn 
from these prohibitory clauses ; for whatever may be 
the policy of the ^National Government, it will be a 
fixed and uniform rule throughout the United States." 
" Surely, we must all be against paper money, we must 
all insist upon maintaining the integrity of the Govern- 
ment ; and we must all set our faces against any propo- 
sition like the present, except as a temporary expedient, 
rendered imperative by the exigency of the hour." 

" Others may doubt if the exigency is sufficiently im- 


perative ; but the Secretary of the Treasury, whose duty 
it is to understand the occasion, does not doubt. In his 
opinion the war requires this sacrifice. Whatever may 
be the national resources, they are not now within reach, 
except by summary process. Eeluctantly, painfully, I 
consent that the process should issue. And yet I cannot 
give such a vote without warning the Government 
against the dangers from such an experiment. The 
medicine of the Constitution must not become its daily 

The motion of Mr. Collamer, on February 13, to 
strike out the legal tender clause, was defeated, 17 yeas 
to 22 nays. Anthony, of Rhode Island, Collamer and 
Foot, of Vermont, Fessenden, of Maine, King, of Xew 
York, Cowan, of Pennsylvania, Foster, of Connecticut, 
and Willey, of Virginia, of the Republicans, voted yea. 
Four Democrats only Davis, of Kentucky, McDougall, 
of California, Rice, of Minnesota, and Wilson, of Mis- 
souri voted nay. The bill passed by a vote of 30 to 1, 
three Republicans Collamer, Cowan, and King and 
four Democrats Kennedy, Pearce. Powell, and Sauls- 
bury voting nay. 

The Senate amendment to pay interest upon the five- 
twenty bonds in coin was adopted by the House, by a 
vote of 88 to 56- The amendment authorizing the 
Secretary to sell the bonds at the market value was also 
adopted ayes, 72 ; nays, 66. 

On February 20th the amendments were returned 
to the Senate with the concurrence of the House in 
part of them, and non-concurrence in others, and with 
some amendments to the Senate amendments ; after 
which a conference committee Senators Fessenden, 


Sherman, and Carlisle, and Eepresentatives Stevens, 
Horton, and Sedgwick was appointed, which committee 
had a long consultation extending through two or three 
days. The report of the conference committee was agreed 
to on the 24th in the House by yeas 97, nays 22, and in 
the Senate on the 25th without a division, and on the 
same day the bill was approved by the President. It 
authorized the issue of 150 millions of United States 
notes, not bearing interest, payable to bearer at the Treas- 
ury of the United States, and of denominations of not 
less than $5, fifty millions of which were to be in lieu of 
the demand treasury notes which had been previously 
issued ; they were similar in form to those notes, but they 
were not receivable in payment of duties on imports, and 
were not payable by the Government for interest upon 
its obligations, which were payable in coin ; they were to 
be a legal tender in payment of all other debts, public 
and private, within the United States. They differed 
from the first notes issued also, and in this respect that 
all holders of legal-tender notes were authorized to de- 
posit any sum not less than $50, or an j multiple of $50, 
with the Treasurer, or either of the Assistant Treasurers, 
and receive duplicate certificates, upon which were to be 
issued to the holder an equal amount of bonds of the 
United States bearing interest at the rate of 6 per cen- 
tum per annum, payable semi-annually, and redeemable 
at the pleasure of the United States after five years, 
and payable twenty years from the date thereof. The 
second section of the same act authorized the issue of 
500 millions of five-twenty bonds into which the treas- 
ury notes were to be funded, in accordance with the 
previous section and as stated in the title of the bill. 


The first notes issued were of the date of March 10, 
1862, and there was printed upon the back the following 
words : " This note is a legal tender for all debts, public 
and private, except duties on imports and interest on the 
public debt, and is exchangeable for United States 6 
per cent, bonds redeemable at Hie pleasure of the United 
States after five years." The ten-dollar note was in its 
general appearance almost precisely like the demand 
note of that denomination ; the principal difference being 
that the words " on demand " were omitted, and the sig- 
natures of the Register and Treasurer were engraved. 

On June T, 1862, the Secretary addressed letters to 
the chairmen of the Committee of Ways and Means of 
the House and the Finance Committee of the Senate, 
recommending a further issue of 150 millions of dollars 
of legal-tender notes. He said that nearly the whole 
issue of sixty millions in demand notes was held by 
bankers and by capitalists, and was at a premium of from 
to.lj per cent, on account of its availability for the 
payment of duties ; so that there was really only about 
ninety millions of United States notes in circulation. 
He said that the United States notes are maintained at 
near par in gold by the provision for their conversion 
into bonds bearing 6 per cent, interest payable in coin, 
and that resumption would be more easily effected " if 
the currency small as well as large were of United 
States notes, than if the channels of circulation be left 
to be filled up by the emissions of non-specie paying 
corporations, solvent and insolvent." "With these letters 
he transmitted bills for the consideration of these com- 
mittees. The immediate necessities of the Government 
admitted of but little delay, and the bill, substantially 


as recommended by the Secretary, passed both Houses, 
and was signed by the President on June 11, 1862. 
The bill authorized the issue of 150 millions of legal- 
tender notes, thirty -five millions of which were to be in 
denominations less than $5. The subsequent act of 
March 3, 1863, authorized the issue of an additional 
150 millions, making the aggregate authorized issue of 
legal-tender notes 450 millions of dollars. This act was 
similar to the previous legal-tender acts, so far as the 
issue of treasury notes was concerned, except that it 
provided " that the holders of United States notes issued 
under former acts shall present the same for the purpose 
of exchanging them for bonds as therein provided on or 
before July 1, 1863, and thereupon the right to exchange 
the same shall cease and determine." 

After the passage of the act of March 3, 1863, the 
Secretary decided to commence the negotiation of 5 per 
cent, ten-forty bonds, and gave notice that he should de- 
cline to allow the holders of legal tenders to fund such 
notes in bonds bearing a greater rate of interest than 
5 per cent, after July 1, 1863. The negotiation of the 5 
per cents was not successful at that time, and that por- 
tion of the act of March 3d which repealed the right to 
fund legal tenders into five-twenties, as printed upon 
the back of the notes, was not only a violation of the 
contract with the holder, but also a serious financial 
mistake. It had the effect to materially reduce the 
value of the treasury notes in the market, prevented the 
further funding of treasury notes after July 1st, and 
undoubtedly postponed for many months the date for 
the resumption of specie payment. 

The highest amount of legal-tender notes outstanding 


at any time was on January 3, 1864, when the amount 
reached $449,338,902. The second section of the act of 
June 30, 1864, provided that "the total amount of 
United States notes issued or to be issued shall not ex- 
ceed 400 millions, and such additional sum, not exceed- 
ing fifty millions, as may be temporarily required for 
the redemption of temporary loans." The following 
table shows by denominations the amount of legal-ten- 
der notes outstanding on January 1, 1885 : 

Ones $26,523,143 80 

Twos 26,840,217 20 

Fives 77,538,81500 

Tens 67,860,366 00 

Twenties 55,513,489 00 

Fifties 22,703,695 00 

One hundreds 33,263,790 00 

Five hundreds 15,015,000 00 

One thousands 22,272,500 00 

Five thousands 100,000 00 

Ten thousands 50,000 00 

Less destroyed in the Chicago fire 1,000,000 00 

Total $346,681,016 00 

Secretary McCulloch, in his report for 1865, expressed 
the opinion that the legal-tender acts were war meas- 
ures, and ought not to remain in force one day longer 
than should be necessary to enable the people to prepare 
for a return to the gold standard. The House of Repre- 
sentatives during the same month passed a resolution, by 
a vote of 144 yeas to 6 nays, " cordially concurring in the 
views of the Secretary of the Treasury in relation to the 
necessity of the contraction of the currency, with a view 


to as early a resumption of specie payment as the busi- 
ness interests of the country will permit." In order to 
carry into effect this resolution, Congress, by an act ap- 
proved March 12, 1866, authorized the retiring and can- 
cellation of not more than ten millions of legal-tender 
notes within six months from the passage of the act, 
and thereafter not more than four millions in any one 
month. Under this act the amount outstanding was so 
far reduced that on December 31, 1867, the amount was 
356 millions. On February 4, 1868, the further reduc- 
tion of the volume of such notes was prohibited, leaving 
the last-named amount outstanding until October 1, 
1872. Between March 17, 1873, and January 15, 1874, 
under Secretary Richardson, the amount was increased 
to $382,979,815, and on June 20, 1874, the maximum 
amount was fixed at $382,000,000 ; section six of the 
act of that date providing that " the amount of United 
States notes outstanding and to be used as a part of the 
circulating medium shall not exceed the sum of 382 mil- 
lions, which said sum shall appear in each monthly state- 
ment of the public debt, and no part thereof shall be 
held or used as a reserve." 

Section three of the act of January 14, 1875, author- 
ized an increase of the circulation of national banks, in 
accordance with existing law, without respect to the 
limit previously existing, but required the Secretary of the 
Treasury to retire legal-tender notes to an amount equal 
to eighty per cent, of the national-bank notes thereafter 
issued, until the amount of such legal-tender notes out- 
standing should be 300 millions, and no more. Under 
the operation of this act $35,318,984 of legal-tender 
notes were retired, leaving the amount in circulation on 


May 31, 1878, the date of the repeal of the act, $346,- 
681,016, which is the amount now outstanding. 

The table on page 142 exhibits the amount of the 
various issues of Treasury notes outstanding on July 1st, 
of each year from 1862 to 1884, and on January 1, 1885 ; 
together with the amount of national- bank notes and the 
value of the legal-tender Treasury note as compared with 
coin for the same dates. 

The act of January 14, 1875, required the Secretary 
of the Treasury, on and after January 1, 1879, to re- 
deem in coin the legal-tender notes on their presentation 
at the office of the Assistant Treasurer in the city of New 
York, in sums of not less than $50. In order that he 
might always be prepared to do this, he was authorized 
" to use any surplus revenue from time to time in the 
Treasury not otherwise appropriated, and to issue, sell, 
and dispose of, at not less than par in coin, any of the 
five, four and one-half, and four per cent, bonds author- 
ized by the act of July 14, 1870. Under this act Sec- 
retary Sherman, in 1877, sold at par in coin fifteen 
millions of four and one-half per cents, and twenty-five 
millions of four's ; and in April, 1878, he sold fifty mil- 
lions of four and one-half per cents at a premium of 1 
per cent. This coin was placed in the Treasury for pur- 
poses of resumption, and on January 1, 1879, the Sec- 
retary held 135 millions of gold coin and bullion, arid, 
in addition, over thirty-two millions in silver coin and 
bullion ; the gold coin alone being nearly equal to 40 
per cent, of the United States notes then outstanding. 

The Assistant Treasurer of the United States, at New 
York, became a member of the clearing-house, thus fa- 
cilitating the business of the banks with the Government. 




The banks in Xew York strengthened the hands of the 
Government by agreeing to receive United States notes, 
not only for their ordinary balances, but in payment of 
the interest upon the public debt, and of other coin ob- 
ligations of the Government. The banks of the country, 
at the date of resumption, held more than one-third of 
the outstanding treasury notes ; but they had so much 
confidence in the ability of the Secretary to maintain re- 
sumption that none were presented by them for redemp- 
tion. The people preferred the issues of national banks 
and of the Government to coin itself. There was, there- 
fore, no demand for payment of the notes of the Govern- 
ment, and the gold coin in the treasury, which amounted 
to 135 millions on the day of resumption, increased more 
than thirty-six millions in the next ten months. The 
amount held on Xovember 1, 1879, exceeded 171 mill- 
ions, and on November 1, 1883, 209 millions. The 
amount held on January 1, 1885, was $234,975,852, in- 
cluding $93,287,420, held for the redemption of gold 
certificates outstanding. The resumption act is still in 
force, and gives the Secretary unlimited power with 
which to provide for the redemption in coin of the legal- 
tender notes. He is thus enabled, so long as the credit 
of the Government continues good, to check, by the sale 
of United States bonds, any exportation of coin which 
might endanger the redemption of the United States 
legal-tender notes. 

From the date of the passage of the act of April 12, 
1866, which authorized a reduction of the amount of 
legal -tender notes, to the passage of the act of July 12, 
1882, enabling national banking associations to extend 
their corporate existence, a period of more than sixteen 


years, hundreds of bills of almost every conceivable form 
to regulate the currency were introduced in Congress. 
Throughout the country the subject was continually dis- 
cussed, not only during political campaigns and at public 
conventions, but in the smaller gatherings of the school 
district and the meetings of individuals by the wayside. 
Speeches and political pamphlets by the thousand, essays, 
campaign papers innumerable, and caricatures of almost 
every kind and description, upon the subject of the ex- 
pansion and contraction of the currency, and its effect 
upon business, were distributed broadcast in all directions. 
Perhaps the most plausible argument which was pre- 
sented, over and over again, in every portion of the coun- 
try during these continued discussions, was in reference 
to the retirement of the national bank-notes, and the 
substitution therefor of treasury notes, in order, as was 
claimed, to save to the Government the interest upon the 
bonds held by the national banks as security for their 
circulating notes. Discussions of this subject in its vari- 
ous forms, and statements of the profits of the circula- 
tion of the national banks at different dates, may be 
found in the reports of the Comptroller of the Currency 
during the last nine years. 

A recent and distinguished writer, discussing the policy 
of the legal-tender issues, says : " Grave differences of 
opinion exist, even to this day, concerning the neces- 
sity and expediency of the legal-tender provision. The 
judgment of many whose financial sagacity is entitled 
to respect is that if the internal tax had been first 
levied, and the policy adopted of drawing directly upon 
the banks from the treasury for the amounts of any 
loans in their hands, the resort by the Government to 


irredeemable paper might at least have been postponed 
and possibly prevented. The premium on gold became 
the measure of the depreciation of the government 
credit, and practically such premiums were the charge 
made for every loan negotiated. In his report of De- 
cember, 1862, Secretary Chase justified the legal-tender 
policy. He explained that by the suspension of specie 
payments the banks had rendered their currency unde- 
sirable for government operations, and consequently no 
course other than that adopted was open. Mr. Chase 
declared that the measures of general legislation had 
worked well. ' For the fiscal year ending with June,' 
he said, ' every audited and settled claim on the Gov- 
ernment, and every quartermaster's check for supplies 
furnished which had reacheol the treasury, had been 
met.' For the subsequent months the Secretary ' was 
enabled to provide, if not fully, yet almost fully, for the 
constantly increasing disbursements.' 

" The political effects of the legal-tender bill were of 
large consequence to the Administration and to the suc- 
cessful conduct of the war. If it had been practicable 
to adhere rigidly to the specie standard, the national ex- 
penditure might have been materially reduced ; but the 
exactions of the war would have been all the time grat- 
ing on the nerves of the people and oppressing them 
with remorseless taxation. Added to the discourage- 
ment caused by our military reverses, a heavy financial 
burden might have proved disastrous. The Adminis- 
tration narrowly escaped a damaging defeat in 1862, 
and but for the relief to business which came from the 
circulation of legal-tender notes, the political struggle 
might have been hopeless. But as trade revived under 


the stimulus of an expanding circulation, as the market 
for every species of product was constantly enlarging 
and prices were steadily rising, the support of the war 
policy became a far more cheerful duty to the mass of 
our people. 

" This condition of affairs doubtless carried with it 
many elements of demoralization, but the engagement 
of the people in schemes of money-making proved a 
great support to the war policy of the Government. 
We saw the reproduction among us of the same causes 
and the same effects which prevailed in England dur- 
ing her prolonged contest with Napoleon. Money was 
superabundant ; speculation was rife ; the Government 
was a lavish buyer, a prodigal consumer. Every man 
who could work was employed at high wages ; every 
man who had commodities to sell was sure of high 
prices. The whole community came to regard the prev- 
alent prosperity as the outgrowth of the war. The 
ranks of the army could be filled by paying extravagant 
bounty after the ardor of volunteering was past, and the 
hardship of the struggle was thus in large measure 
concealed if not abated. Considerate men knew that 
a day of reckoning would come, but they believed it 
would be postponed until after the war was ended and 
the Union victorious. 

" The policy of the legal- tender measure cannot there- 
fore be properly determined if we exclude from view 
that which may well be termed its political and moral 
influence upon the mass of our people. It was this 
which subsequently gave to that form of currency a 
strong hold upon the minds of many who fancied that 
its stimulating effect upon business and trade could be 


reproduced under utterly different circumstances. Ar- 
gument and experience have demonstrated the fallacy 
of this conception, and averted the evils which might 
have flowed from it. But in the judgment of a large 
and intelligent majority of those who were contempo- 
rary with the war and gave careful study to its progress, 
the legal-tender bill was a most effective and powerful 
auxiliary in its successful prosecution." 1 

1 Twenty Years of Congress. James G. Elaine. Vol. I., pp. 427- 
429. Norwich, Conn. : Tke Henry Bill Publishing Company. l-*84. 



THE act of April 2, 1792, for establishing a mint and 
regulating the coinage of the United States, authorized 
the free coinage of a silver dollar of 412.5 grains, and 
this provision remained in force until 1873. 

The act of June 28, 1834, which reduced the gold 
standard about six and one-fourth per cent., practically 
demonetized the silver coinage. Previous to the date 
of the passage of that act American gold and silver coins 
of all denominations were equally a legal tender, and the 
silver coins of less denomination than one dollar were 
chiefly in use, only $1,369,517 in Silver dollars having 
been issued from the mint at that date. The act of 
1834 overvalued the gold coinage, driving from the 
country the full-weight silver coins previously in circula- 
tion ; and it may be confidently stated that from 1834 
to 1873 no silver dollar-pieces had been presented at 
any custom-house in payment of duties. The entire 
customs-duties of the country during this period were, 
with the exception of silver used in change, paid in gold 
coin, and from this fund the interest paid upon the pub- 
lic debt has been chiefly derived ; and it is not probable 
that during this time any of these silver dollar-pieces 
were used in this country in the payment of debt, except 


in certain cases of special contract, while thousands of 
millions in gold coin have been used to liquidate debts, 
both public and private. The average amount in silver 
dollar-pieces annually coined from 1834 to 1873 was 
about $160,000. 

From 1793 the date of the first issue of silver coin 
by the United States to 1834 the silver and the gold 
dollar were alike authorized to be received as legal ten- 
der in payment of debt, but silver alone circulated. 
Subsequently, however, silver was not used, except in 
fractional payments, or, since 1853, as a subsidiary coin. 
The silver coin, as a coin of circulation, had become 
obsolete. The reason why, prior to 1834, payments 
were made exclusively in silver, and subsequently to 
that date in gold, is found in the fact that prior to 
the legislation of 1834 the weight of fine silver in the 
silver dollar was fixed at fifteen times the weight of fine 
gold in the gold dollar ; but after that date, owing to a 
reduction in the weight of gold required for the standard 
gold dollar, the silver dollar was made to contain of fine 
metal almost precisely sixteen times that of the new 
gold dollar, the actual market value of gold during the 
entire period having been greater than fifteen and less 
than sixteen times the value of silver of equal weight. 
During the earlier period, therefore, the standard silver 
coins were relatively the cheaper, and consequently cir- 
culated to the exclusion of the gold ; while during the 
later period the standard gold coins were the cheaper, 
circulating to the exclusion of the silver. 

The Coinage Act of 1873, by which the coinage of the 
silver dollar was discontinued, became a law on Febru- 
ary 12th of that year. The act of February 28, 1878, 


which passed Congress by a two-thirds vote over the 
veto of President Hayes, again provided for the coinage 
of a silver dollar of 412.5 grains, the silver bullion to be 
purchased at the market price by the Government, and 
the amount so purchased and coined not to be less than 
two millions of dollars per month. During the debate 
on this bill the charge was repeatedly made, in and out 
of Congress, that the previous act of 1873, discontinuing 
the free coinage of the silver dollar, was passed surrep- 
titiously. This statement has no foundation in fact. 

The report of the writer, who was then Deputy Comp- 
troller of the Currency, transmitted to Congress in 18TO 
by the Secretary, three times distinctly stated that the 
bill accompanying it proposed to discontinue the issue 
of the silver dollar-piece. 1 Various experts, to whom it 
had been submitted, approved this feature of the bill, 
and their opinions were printed by order of Congress. 
The House was informed by its members of this provi- 
sion, and the bill was printed thirteen times by order of 
Congress, and once by the commissioners revising the 
statutes, and was considered during five successive ses- 
sions. If the question of the double standard did not 
become prominent in the discussion upon the bill, it was 
for the reason that usage had established the gold dollar 
as the unit, the silver dollar, on account of its greater 
relative value, having, with the Mexican dollar and the 
pistareen, disappeared from the circulation of the coun- 
try. The Coinage Act of 1873 2 and the Eevised Statutes 
of 1874 simply registered in the form of a statute what 

1 Senate, Mis. Doc. No. 132, XLI. Cong. , 2d Sess. 
! For the history of the Coinage Act of 1873, see pp. 170-175, Re- 
port of the Comptroller of the Currency for 1876. 

COINAGE ACT OF 1873. 151 

had been really the unwritten law of the land for nearly 
forty years. 

It is not probable that any act passed by any Con- 
gress ever received more care in its preparation, or was 
ever submitted to the criticism of a greater number of 
practical and scientific experts ' than was this Coinage 
Act of 1873. The statements in reference to the surrep- 
titious or inadvertent passage of the bill was subsequently 
repeated in the city of Paris by a member of the Silver 

A well-known scientific author 2 and writer on finan- 
cial subjects, in criticising the report of the Paris Silver 
Commission, says : 

" Another act which must have placed our commis- 
sioners at a moral disadvantage was their filing the hu- 
miliating plea that the act of 18T3, demonetizing the 
silver dollar, was passed through inadvertence. 

" It is difficult to see what this plea meant, what re- 
lation it had to the business of the conference, or what 
object was to be gained by raising it. If a proposed 
law can be debated in Congress for five years, be reported 
several times from committees in various forms, be rec- 
ommended by the Secretary of the Treasury in at least 
one annual report, finally pass both Houses of Congress, 
and be signed by the President, then remain on the 
statute-books for two or three years without any one 
knowing it, and all through 'inadvertence,' what shall 
we say of our political system, or of the attention of 

1 H. R., Ex. Doc. No. 307, XLI. Cong., 2d Sess. 
s The Silver Commission and the Silver Question, by Professor 
Simon Newcomb : International Review, March, 1879. 


our people or our legislators to public affairs ? Every 
one who cares for the good name of his country will 
certainly say, ' Try to keep the fact out of the newspa- 
pers, and by no means confess it to our neighbors.' The 
plea was as pointless as humiliating. Had our delegates 
frankly said that at the time of the passage of the act 
silver had long ceased to circulate in their country, ex- 
cept as a subsidiary coin ; that, therefore, the legislation 
discontinuing its coinage and legal tender was, at the 
time, only a matter of form, the acceptance of a histori- 
cal fact ; but that the extraordinary fall in the price of 
silver which had occurred in the meantime had again 
called public attention to the subject, and convinced us 
that silver should be money of full power, and thus led 
us to retrace our steps, the statement would have been 
correct and frank, and would have produced a much 
better effect than did the plea actually put forward." 

The act of February 28, 1878, also authorized the 
holder of these silver dollars to deposit the same with 
the Treasurer, or any Assistant Treasurer, of the United 
States, in sums not less than ten dollars, and receive 
therefor certificates of not less than ten dollars each, 
corresponding with the denominations of the United 
States notes. It required that the coin deposited or rep- 
resenting the certificates should be retained in the treas- 
ury for the payment of the same on demand, and that 
said certificates should be receivable for customs, taxes, 
and all public dues, and also authorized their reissue. 
This act did not authorize their use as clearing-house 
certificates, nor make them available as lawful reserve 
for the national banks. The following table shows the 
amount of standard silver dollars coined under the act of 


February 28, 1878, the amount in the treasury, and the 
amount of silver certificates outstanding on July 1st, 
from 1878 to 1884, and on January 1, 1885 : 



Amount in treas- 

Silver certi- 
ficates out- 


$8 573 500 

$7 718 357 

gl 850 410 


35 801 000 

28 358 589 

2 529 950 


63,734 750 

45,108 296 

12,374 270 





1882 ' 





147 255 899 

111 914 019 

88 616 831 


175 355 829 

135 560 916 

96 427 Oil 

1885, January 1 




This table exhibits the rapid increase in the coinage 
of the silver dollar and in the issue of silver certificates. 
The law requires the purchase of not less than two 
millions of silver bullion each month for coinage into 
silver dollars. It provides for a forced coinage of silver 
dollars at the expense of the gold coin in the treasury ; 
and the various efforts to repeal this law have been fruit- 
less. If not repealed the result will be, not long hence, 
the demonetization of the gold coin which is now the 
standard, and the substitution of the silver dollar in place 
thereof. This law would doubtless have been repealed 
long since if silver certificates had not been issued in place 
of the silver dollar, the latter coin becoming unpopular 
when forced upon a people so long accustomed to a paper 
medium. The silver certificate, which is a substitute for 
the cumbrous dollar, performs every service of the coin 
itself, with a single exception,, It is not a legal tender in 
payments between individuals, but it is receivable in pay- 
ment of all public dues, may be included in the reserves 
of the banks, and used in the payment of clearing-house 


balances. Even the legal-tender note is not and never 
has been authorized to be received in payment of customs 

The cost of the transportation of gold coin between 
remote points is so great that many millions of gold coin 
have been exchanged during the last two years for paper 
silver certificates, the treasury itself, without any spe- 
cial authority of law, encouraging in this way the circula- 
tion of this inferior medium, which is issued against 
deposits of silver dollars only, thus rendering this other- 
wise undesirable silver coinage available for use by the 
banks and the people. 

In the opinion of those who believe in a single gold 
standard, the silver certificate is a most dangerous 
substitute for money. The recent decision of the Su- 
preme Court places in Congress the power to increase 
the issue of legal-tender notes at all times, and there is 
great danger that every commercial crisis or sudden 
panic, or cry of hard times, may be succeeded by legis- 
lation which shall increase the issue of the greenback 
and reduce its value even below the level of the silver 
certificate ; the former being a promise to pay dollars 
either gold or silver, while the latter represents the 
silver coin itself safely stored in the vaults of the 

The Government may at any time bring the nation 
upon the silver standard by declining to make payments 
or to redeem the legal-tender notes in gold, thus taking 
from the holder the option of payment. In such an 
event the hoard of coin will not be increased by customs 
duties paid in gold as at present, but by the return of 
silver dollars and silver certificates and legal- tender 


notes, thus demonetizing all of the gold coin of the 
country, and advancing prices to the level of the silver 

The act of July 12, 1882, authorized and directed the 
Secretary of the Treasury to receive deposits of gold 
coin in denominations of not less than $20 each, corres- 
ponding with the denominations of the United States 
notes. The coin deposited for the certificates is re- 
quired to be retained for the payment of the same on 
demand, and these certificates, and also silver certificates, 
are authorized to be counted as part of the lawful re- 
serve of the national banks. The act also provides, not- 
withstanding the fact that these issues are not a legal 
tender, that no national banking association shall be a 
member of any clearing-house in which such certificates 
shall not be receivable in the settlement of clearing- 
house balances. 

The amount of gold certificates which have been is- 
sued under the act of July 12, 1882, was, on Novem- 
ber 1, 1883, $21,790,000 ; on April 1, 1884, $87,874,500 ; 
and on January 1, 1885, $117,050,170. 



ON April 30, 1866, the Legislature of New York pro- 
vided by law for refunding to the banks and other 
corporations in like condition, the taxes of 1863 and 1864 
collected upon that part of their capital invested in securi- 
ties of the United States exempt by law from taxation. 
The Board of Supervisors of the County of New York 
was charged with the duty of auditing and allowing, 
with the approval of the Mayor of the city and the Cor- 
poration Counsel, the amount collected from each corpor- 
ation for taxes on the exempt portion of its capital, to- 
gether with costs, damages, and interest. This act was 
passed in conformity with the decisions of the United 
States Supreme Court in Bank of Commerce vs. Xew 
York City (reported in 2 Black, 620), and in the Bank Tax 
Case (reported in 2 Wallace, 200), which decided that a 
tax on banking capital invested in Government securi- 
ties being a tax on the obligations of the United States, 
by State authority was void. The Bank of Xew York 
presented a claim to the said Board of Supervisors for 
the refunding of those taxes which the bank had paid on 
the United States notes commonly called " greenbacks" 
during the years aforesaid. The Board refused the ap- 


plication on the ground that " greenbacks " were not 
" securities " of the United States Government, but were 
practically and in effect " money," taxable as cash. The 
Court of Appeals of the State of New York sustained 
the action of the Board, but on appeal to the United 
States Supreme Court (Bank vs. The Supervisors, 7 Wal- 
lace, 26), that court, at its December term, 1868, re- 
versed the opinion of the State court. 

The court said: " The act of February, 1862, declares 
that ' All United States bonds and other securities of the 
United States held by individuals, associations, or cor- 
porations within the United States, shall be exempt from 
taxation by or under State authority.' We have already 
said that these notes are obligations. They bind the 
national faith. They are, therefore, strictly securities. 
They secure the payment stipulated to the holders by 
the pledge of the national faith, the only ultimate secu- 
rity of all national obligations, whatever form they may 

On June 20, 1860, a certain Mrs. Hepburn made a 
promissory note, by which she promised to pay to Henry 
Griswold, on February 20, 1862, eleven thousand two 
hundred and fifty " dollars." At the time when the note 
was made, and also at the time when it fell due, there was, 
confessedly, no lawful money of the United States, or 
money which could be lawfully tendered in payment of 
private debts, but gold and silver coin. Five days after 
the day when the note by its terms fell due, that is to say, 
on February 25, 1862, Congress passed the first legal-ten- 
der act, commonly so called, by which the United States 
notes issued thereunder were made a legal tender for 
" all debts, public and private, within the United States," 


except certain public debts. In March, 1864, Mrs. Hep- 
burn, Laving been sued on the note in the Louisville 
Chancery Court, in the State of Kentucky, tendered pay- 
ment of the debt, principal and interest, in the United 
States notes issued under this act. The amount ten- 
dered, $11,250 in legal-tender notes, at that time was 
worth only about $7,000 in coin. The tender was re- 
fused. The notes were then tendered and paid into 
court. It was declared by the Chancellor to be a satis- 
faction of the debt. The case was appealed to the Court 
of Errors of Kentucky. That court reversed the Chan- 
cellor's decision, and ordered a contrary judgment to be 
entered. Whereupon Mrs. Hepburn took the case to 
the United States Supreme Court, where it was first ar- 
gued upon printed briefs at the December term, 1867, 
and afterward reargued by very numerous and able 
counsel at the December term, 1868, but not decided un- 
til the December term, 1869 (Hepburn vs. Griswold, 8 
"Wallace, 603). The court was comprised of Mr. Chief 
Justice Chase and Associate Justices Kelson, Clifford, 
Field, Grier, Davis, Miller, and Swayne. Mr. Justice 
Grier resigned before the opinion of the court was an- 
nounced, but agreed with the majority in the consultation 
room, as was announced by the Chief Justice. The 
Chief Justice delivered the opinion of the court. In 
this opinion Justices Nelson, Clifford, and Field con- 
curred. The court held that the language of the act of 
February 25, 1862, making the United States notes issued 
thereunder " a legal tender in payment of all debts, pub- 
l ; c and private, within the United States," included pre- 
existing debts as well as debts which should be incurred 
after the passage of the act, and while it might be an 


exercise of rightful power in Congress, under the powers 
granted it by the Constitution, to declare war, suppress in- 
surrection, raise and support armies and navies, borrow 
money on the credit of the United States to pay the debts 
of the Union, and to provide for the common defence and 
general welfare- to emit bills of credit or United States 
notes intended to circulate as money, and make the same 
legal tender for debts to be incurred after the passage 
of the act, yet inasmuch as the act by construction de- 
clared these notes to be legal tender in payment of pre- 
existing debts, that the act was inconsistent with the spirit 
of the Constitution, and was not a law " necessary and 
proper " for carrying into execution the powers vested 
by the Constitution in Congress or in the Government 
of the United States. The Constitution reads that 
Congress shall have, besides certain powers granted in 
express terms, " power to make all laws which shall be 
necessary and proper for carrying into execution the fore- 
going powers, and all other powers vested by this Consti- 
tution in the Government of the United States, or in any 
department or offices thereof." The court held that the 
legal-tender clause was unnecessary and improper ; that 
the notes would have maintained themselves equally 
well without it. The Chief Justice quoted the fact that 
the three hundred millions of dollars in notes issued by 
the national banking associations under the act of Feb- 
ruary, 1863, and the fifty millions of fractional currency 
issued under the act of March, 1863, were not made a 
legal tender, and argued that it was the quality of re- 
ceivability for public dues, and not the quality of legal 
tender which made these United States notes circulate as 
freely as they did. The Chief Justice declared that the 


act was obnoxious to those clauses of the Constitution, 
also, which forbade the impairment of the obligations 
of contracts, the taking of private property for public 
use without compensation, and the deprivation of any 
person of his property without due process of law. 
And that the Constitution was ordained to " establish 
justice," which this act did not do, so far as regards 
pre-existing debts. For all of which reasons, elabor- 
ately stated, the court held the act unconstitutional and 
therefore void. 

Mr. Justice Miller, with whom concurred Justices 
Davis and Swayne, delivered a dissenting opinion. He 
held that what was " necessary and proper " to carry 
into execution the powers vested by the Constitution 
in the Government of the United States, cannot right- 
fully be construed to mean only such legislation as 
is indispensably necessary, but that Congress has the 
choice of means, and is empowered to use any means 
which are, in fact, conducive to the exercise of the 
power granted or calculated to produce the end de- 
sired. He fortified this position by the clear, strong deci- 
sions of the court delivered by Chief Justice Marshall, 
who announced this exposition of the Constitution in 
United States vs. Fisher (2 Cranch, 358) and in McCul- 
loch vs. The State of Maryland (4 Wheaton, 316). He 
further said that, while the Constitution forbade any 
State from impairing the obligation of a contract, it said 
nothing about the power of Congress in the premises. 
And that the provision that private property should not 
be taken for public use without due compensation, nor 
any person be deprived of his property without due 
course of law, had no application to the indirect ef- 


feet of great public measures whereby lands, stocks, 
contracts, etc., might depreciate in value, because, for in- 
stance, such an effect would doubtless succeed an imme- 
diate abolition of the tariff on iron by depreciating the 
value of furnaces and the capital employed in its man- 
ufacture, and yet no one would claim that such a re- 
peal was therefore unconstitutional and void. That the 
whole argument of the injustice of the law and of its 
being opposed to the spirit of the Constitution was too 
abstract and intangible for application to courts of jus- 
tice. That the act was passed to save the life of the Gov- 
ernment, to pay its soldiers and sailors, and other public 
debts. That the legal-tender clause was considered 
"necessary and proper" by Congress, and that the 
courts had no right to interfere with that discretion. 
" It would authorize this court to enforce theoretical 
views of the genius of the Government, or vague notions 
of the spirit of the Constitution and of abstract justice, 
by declaring void laws which did not square with those 
views. It substitutes our ideas of policy for judicial 
construction, an undefined code of ethics for the Consti- 
tution, and a courtof justice for the National Legislature." 
One Parker (Legal-Tender Cases, 12 Wallace, 457) 
was under contract to convey a lot of land to one Davis, 
upon payment of a certain sum of money. The contract 
was dated, and suit was brought upon it before the pas- 
sage of any of the legal-tender acts. After their pas- 
sage, to wit, in February, 1867, the Supreme Court of 
Massachusetts decreed that Davis should pay into court 
a certain sum of money, and that Parker should there- 
upon execute a deed to him for the land in question. 
Davis accordingly paid into court the given sum in. 


United States notes. Parker refused to execute the deed 
on the ground that he was entitled to coin ; whereupon 
the court changed the decree, and ordered that Parker 
should execute the deed upon payment by Davis into 
court of the specificed sum in United States notes. 

From that decree the case was appealed to the United 
States Supreme Court. The case was argued at its De- 
cember term, 1870, and decided on May 1, 1871 ; and 
on January 15, 1872, the opinion of the court was de- 
livered by Justice Strong, who, with Justice Bradley, had 
been added to the court in 1870, by President Grant, 
making a full bench of nine. The other justices had 
sat in the case of Hepburn vs. Griswold. The court 
overruled the latter case and held the legal-tender acts 
to be constitutional both as respects contracts made be- 
fore their enactment as well as after. The court said, 
in reference to the case of Hepburn vs. Griswold : 
" That case was decided by a divided court, and by a 
court having a less number of judges than the law then 
in existence provided that this court shall have. These 
cases have been heard before a full court, and they have 
received our most careful consideration." 

Mr. Justice Bradley, in his separate concurring opinion, 
said : " And in this case, with all deference and respect 
for the former judgment of the court, I am so fully con- 
vinced that it was erroneous and prejudicial to the rights, 
interests, and safety of the general Government, that I, 
for one, have no hesitation in reviewing and overruling 
it. It should be remembered that this court, at the 
very term in which, and within a few weeks after, the 
decision in Hepburn vs. Griswold was delivered, when 
the vacancies on the bench were filled, determined to 


hear the question reargued. This fact must necessarily 
have had the effect of apprising the country that the de- 
cision was not fully acquiesced in, and of obviating any 
injurious consequences to the business of the country by 
its reversal." 

Justice Strong, in delivering the opinion of the court, 
reiterated and enforced the arguments made by the 
minority in Hepburn vs. Griswold. He held that the 
distinction made by the Chief Justice in regard to the 
constitutional validity of the act as to debts contracted 
after its passage and debts contracted before, was not 
well founded, and that the fundamental question was, 
Can Congress constitutionally give to United States 
notes the character and quality of money ? If they can, 
then such notes can be made legally available to fulfil 
all contracts solvable in money, without reference to 
the time when such contracts were made, unless ex- 
pressly otherwise provided. 

It was not insisted that Congress might make money 
of that which possessed no value. " What we do assert 
is, that Congress lias power to enact that the Govern- 
ment's promises to pay money shall be, for the time being, 
equivalent in value to the representative of value deter- 
mined by the coinage acts, or to multiples thereof." 
And that, therefore, all contracts calling for " dollars " 
simply, can be legally fulfilled by a tender of the Gov- 
ernment's promises to pay dollars, by force of the legal- 
tender acts, without regard to date. And on this point 
Mr. Justice Bradley, in his concurring opinion, after no- 
ticing that life, liberty, and property are equally sub- 
ject to be impaired, from the exercise of undoubted 
national powers in times of emergency or necessity, 


says : " So with the power of the Government to borrow 
money, a power to be exercised by the consent of the 
lender, if possible, but to be exercised without his con- 
sent if necessary. And when exercised in the form of 
legal-tender notes or bills of credit, it may operate for 
the time being to compel the creditor to receive the 
credit of the Government in place of the gold which he 
expected to receive from his debtor. All these are fun 
darnental political conditions on which life, property, and 
money are respectively held and enjoyed under our sys- 
tem of government, nay, under any system of govern- 
ment. There are times when the exigencies of the 
State rightly absorb all subordinate considerations of 
private interest, convenience, or feeling; and at such 
times the temporary, though compulsory, acceptance by 
a private creditor of the Government credit, in lieu of 
his debtor's obligation to pay, is one of the slightest 
forms in which the necessary burdens of society can be 
sustained. Instead of being a violation of such obliga- 
tion, it merely subjects it to one of those conditions 
under which it is held and enjoyed." 

The Chief Justice, with whom concurred Justices Nel- 
son, Field, and Clifford, delivered a dissenting opinion. 
He strenuously maintained his former views, as did also 
Justices Field and Clifford, in separate opinions. The 
burden of their argument was, that the Constitution for- 
bade any State to make anything but gold and silver a 
legal tender, and granted to the Government only the 
right to coin this gold and silver, and regulate the value 
thereof and of foreign coin. And while the power to 
emit treasury notes was conceded as one means of bor- 
rowing money, yet that Congress had no right to make 


such notes money, or legal tender as money. Mi 1 . Jus- 
tice Clifford showed that the words " and emit bills on 
the credit of the United States" were originally reported 
in article seven, in the draft of the Constitution as sub- 
mitted to the convention. Mr. Morris moved to strike 
the clause out on the ground that it was unnecessary, 
and a vicious suggestion of a power which would be 
unquestionably used anyhow without it. Mr. Madison 
thought it would be sufficient to let the clause remain, 
as it did not contain the hurtful power to make such 
bills legal tender, but finally voted in favor of striking 
out the clause entirely as was done, as eliminating even 
a "pretext for a paper currency, and particularly fw 
making the bills a tender either for public or private 
debts" without disabling the Government from the use 
of treasury notes. 

One Juilliard, a citizen of Xew York, made a sale of 
cotton to one Greenman, the defendant, who is a citizen 
of Connecticut, in April, 1879, for $5,122.90, payable on 
delivery. The defendant tendered in payment 85,100 
in United States notes of the series of 1878, which had 
been redeemed and reissued under the act of May 31, 
1878, and $22.90 in gold and silver coin. The coin 
was accepted, but the tender of the United States notes 
was rejected, and Juilliard claims judgment for $5,100 
with interest and costs. The case was submitted in the 
United States Circuit Court at ]STew York in June with- 
out assignment, and a pro forma decision was rendered 
for the defendant, whereupon the plaintiff appealed to 
the Supreme Court. 

The opinion of the court in the first legal-tender case 
submitted, which was concurred in by five judges out of 


eight, was that at no time could Congress constitution- 
ally give the quality of legal tender to United States 
notes. Then came the decision of the United States 
Supreme Court, after the number of judges had been in- 
creased to nine, making these notes a legal tender for 
all debts, whether contracted before the passage of the 
legal-tender act or after that date. The constitutionality 
of the legal-tender acts was based upon the war powers 
of Congress, leaving the question still open whether said 
notes could be issued in time of peace. 

The decision of the Supreme Court delivered during 
the present term, which has been concurred in by eight 
judges, with but one dissentient, holds that under the 
Constitution Congress has power, if it deems it expe- 
dient, to issue legal-tender notes to any amount either 
in time of peace or war. 

The opinion of the court and the dissenting opinion 
are given in the Appendix. 

Since these opinions were rendered, resolutions have 
been introduced in the present Congress, both in the 
Senate and the House, proposing an amendment of the 
Constitution in regard to the issue of legal- tender paper 
money. As the Constitution provides that amendments 
to it shall be concurred in by a vote of two-thirds of 
each House, and subsequently ratified by three-fourths 
of the Legislatures of the several States, it is probable 
that the questions presented in this volume will con- 
tinue to be discussed, both in Congress and by the 
people for many years to come. 



THE following historical sketch is properly included in 
this volume, not alone on account of the recent dis- 
cussion of similar propositions and the introduction of 
similar measures in Congress, but also for the reason, as 
may be seen by reference to Chapter VI., that the dis- 
tribution of the surplus was the immediate cause of the 
issue of treasury notes during the period of the finan- 
cial crisis of 1837. 

The report of the Secretary of the Treasury, William 
H. Crawford, for 1816, and his reports and those of his 
successor, Richard Rush, for succeeding years up to 1827, 
had in the estimates made shown an available surplus 
of revenues over all expenditures of from two to six 
millions of dollars. This led to some discussion as to 
the best method of employing this surplus. Secretary 
Crawford suggested in 1816 that it be used in internal 

In 1827 the first proposition to distribute the surplus 
was made in Congress. A bill for the distribution of 
$5,000,000 annually for four years was introduced and 
laid on the table. On motion of Mr. Dickerson, of Kew 
Jersey, the author of the measure, it was taken up for 
discussion. He stated its principal object to be to pro- 


vide the States with money for educational and internal 
improvements. But Congress adjourning soon after- 
ward, it received but little attention. 

The Secretary of the Treasury (Ingham), in his report 
to Congress in December, 1829, estimated that the reve- 
nues of the Government for that year would amount, in- 
cluding the balance on hand on January 1st, to $30,574,- 
666, and the expenditures to $26,164,595, of which 
$9,841,011 was on account of principal and $2,563,994 
on account of interest of the public debt. He also esti- 
mated that the public revenue for the next five years 
would be such as to leave free for application to the pay- 
ment of the public debt about twelve millions yearly. 
The amount of debt becoming due or payable during 
the next five years was $48,522,869. The surplus, after 
paying this indebtedness, would be twelve millions. 
The Secretary did not favor a sudden change in the 
tariff, but recommended such gradual changes as would 
reduce the revenues to correspond with the existing ex- 

President Jackson, in his message to Congress in 
1829, said : " After the extinction of the public debt, it 
is not probable that any adjustment of the tariff, upon 
principles satisfactory to the people of the Union, 
will, until a remote period, if ever, leave the Govern- 
ment without a considerable surplus in the treasury be- 
yond what may be required for its current service. As, 
then, the period approaches when the application of the 
revenue to the payment of debt will cease, the disposi- 
tion of the surplus will present a subject for the serious 
deliberation of Congress, and it may be fortunate for 
the country that it is yet to be decided. Considered in 


connection with the difficulties which have heretofore 
attended appropriations for purposes of internal im- 
provement, and with those which this experience tells 
us will certainly arise whenever power over such subjects 
may be exercised by the general Government, it is hoped 
that it may lead to the adoption of some plan which will 
reconcile the diversified interests of the States, and 
strengthen the bonds which unite them. Every mem- 
ber of the Union, in peace and in war, will be benefited 
by the improvement of inland navigation and the con- 
struction of highways in the several States. Let us, 
then, endeavor to attain this benefit in a mode which 
will be satisfactory to all. That hitherto adopted has, 
by many of our fellow-citizens, been deprecated as an 
infraction of the Constitution, while by others it has 
been viewed as inexpedient. All feel that it has been 
emplo3 r ed at the expense of harmony in the legislative 
councils. To avoid these evils, it appears to me that 
the most safe, just, and federal disposition which could be 
made of the surplus revenue, would be its apportionment 
among the several States according to their ratio of rep- 
resentation ; and should this measure not be found war- 
ranted by the Constitution, that it would be expedient to 
propose to the States an amendment authorizing it. I 
regard an appeal to the source of power, in cases of real 
doubt, and where its exercise is deemed indispensable to 
the general welfare, as among the most sacred of all our 

It thus appears that President Jackson regarded as 
unconstitutional the appropriation of money for in- 
ternal improvements by Congress, and, in view of 
the anticipated surplus, suggested that its distribution 


among the States will enable them to make such im- 
provements without the assistance of Congress. He in- 
timated that such a distribution would be constitutional, 
but if there was any doubt on this point, an amendment 
would remove the difficulty. During the session of Con- 
gress of 1829-30, the duties on tea, coffee, cocoa, salt, 
and also on tonnage, were reduced, but the reductions 
were not sufficient to exhaust the surplus after the debt 
then maturing should be paid. 

In his message for December, 1830, President Jack- 
son referred to this subject as follows : " In my first 
message I stated it to be my opinion that it is not prob- 
able that any adjustment of the tariff, upon principles 
satisfactory to the people of the Union, will, until a re- 
mote period, if ever, leave the Government without a 
considerable surplus in the treasury beyond what may 
be required for its current services. I have had no 
cause to change this opinion, but much to confirm it." 
The Secretary of the Treasurj^, in his report for 1832, 
says: "After January 1, 1833, no part of the public 
debt, except the remaining fragments of the unfunded 
debt, of which only small portions are occasionally pre- 
sented, will be redeemable before the following year ; 
and, though there will be in the treasury during the 
year ample means to discharge the whole debt, they can 
be applied only to the purchase of stock at the market 

The whole public debt was virtually extinguished by 
January 1, 1835, on which date the balance of available 
funds in the treasury was $5,586,232. It was estimated 
that for the year 1835 the receipts from all sources 
would be twenty millions ; the actual receipts were 


$35,430,087, the receipts from the sale of the public 
lands during that year having greatly increased. In 
1834 these receipts were only $4,857,600, but in 1835 
they were $14,757,600. The receipts from the sales of 
public lands in 1834-5-6 were $44,492,381, and the 
total receipts from this source, from 1796 to 1834, were 
but $44,595,000. The balance left in the treasury at 
the beginning of the year 1833 was $2,011,777 ; in 
1834, $11,702,905 ; in 1835, $8,892,858, and on Janu- 
ary 1, 1836, $26,749,803. In view of this large balance, 
and its probable large increase by January 1, 1837, the act 
of June 23, 1836, was passed, authorizing the distribu- 
tion of the surplus among the States. 

As has been seen, this method of disposing of the sur- 
plus was favorably suggested by President Jackson in his 
message for 1829, and again indorsed by him in his 
message for 1830. In 1836, however, the views of the 
President appear to have changed. Secretary Wood- 
bury, in his report for 1835, disapproved of the distri- 
bution of the surplus among the States, intimating that 
it was unconstitutional. He said : " The people them- 
selves, it is believed, can best manage all their own 
money which they and their representatives think may 
not be wanted for public purposes ; and it would seem 
to be far preferable to leave it originally in their 
possession, than to withdraw it for the expensive 
operation of returning it substantially to the place 
whence it came, and that probably in a manner not 
conformable to the Constitution, till after the delay 
of procuring an amendment to it ; and even then not 
expedient, because calculated injudiciously to strengthen 
the general Government, and to render the States more 


dependent on a great central power for yearly and im- 
portant resources. Indeed, a reduction in the price of 
public lands, whose unusually large sales the past year 
are the source of most of the present surplus, would, if 
their sales should not thereby be much increased, seem 
another mode far more natural to obviate the present 
difficulty. But, before adopting it, this and various 
other considerations must be weighed, and it must be 
fully considered whether all the revenue anticipated 
from them at their present prices would not be neces- 
sary, after the great reductions in the tariff in 1842, and 
whether a resort to a higher tariff would not then be- 
come indispensable, if the average receipts from lands 
or customs should, from any new legislation, become 
then much diminished below the estimates which have 
been submitted on the present occasion." 

This change of opinion of the Administration from 
1829 to 1836 was probably owing to the hostility of 
the President to the Bank of the United States, result- 
ing in the veto of the bill for renewal of its charter 
on July 10, 1832, and the removal of the United 
States deposits from the bank by order of the Secre- 
tary of the Treasury of September 26, 1833. In 1835 
and 1836 the revenues of the Government were de- 
posited with the State banks, the favorites of the Ad- 
ministration, and the distribution of the surplus at this 
time among the States would have deprived these banks 
of the deposits. In his message to Congress of 1836, 
after the passage of the act of June of that year, regulat- 
ing the public deposits, and providing at the same time 
for the distribution of the surplus in the treasury on 
January 1, 1837, President Jackson said : " Without de- 


siring to conceal that the experience and observation of 
the last two years have operated a partial change in my 
views upon this interesting subject, it is nevertheless re- 
gretted that the suggestions made by me in my annual 
message of 1829 and 1830 have been greatly misunder- 
stood. At that time the great struggle was begnn 
against that latitudinarian construction of the Constitu- 
tion which authorizes the unlimited appropriation of 
the revenues of the Union to internal improvements 
within the States, tending to invest in the hands, and 
place under the control, of the general Government all 
the principal roads and canals of the country, in violation 
of State rights and in derogation of State authority. 
At the same time the condition of the manufacturing 
interest was such as to create an apprehension that 
the duties on imports could not, without extensive mis- 
chief, be reduced in season to prevent the accumulation 
of a considerable surplus after the payment of the na- 
tional debt. In view of the dangers of such a surplus, 
and in preference to its application to internal improve- 
ments, in derogation of the rights and powers of the 
States, the suggestion of an amendment of the Consti- 
tution to authorize its distribution was made. It was 
an alternative for what was deemed greater evils a 
temporary resort to relieve an overburdened treasury 
until the Government could, without a sudden and de- 
structive revulsion in the business of the country, grad- 
ually return to the just principle of raising no more 
revenue from the people, in taxes, than is necessary for 
its economical support. Even that alternative was not 
spoken of but in connection with an amendment of the 


In the meantime Jackson, in his attack on the Bank 
of the United States, had been bitterly opposed by 
Clay, Calhoun, Webster, and a majority of both Houses 
of Congress, by whom many of his acts were re- 
garded as an exercise of arbitrary power. In his first 
message in 1829 he recommended that the Bank of 
the United States should not be rechartered. In Jan- 
uary, 1832, the bank's memorial for recharter was pre- 
sented both in the House and Senate, and, after some de- 
bate, the bill for the recharter passed both Houses. This 
bill was vetoed, on July 10th, by the President, and the 
recharter of the bank was made one of the issues of the 
campaign of 1832. Henry Clay was defeated and Jack- 
son re-elected, and the latter claimed that the result was 
an indorsement of his policy against the bank. 

During the summer of 1832, Jackson, as a measure of 
hostility against the bank, conceived the project of the 
removal of the United States deposits. Benton, in his 
" Thirty Years' View " (vol. i., p. 377), says : " General 
Jackson was not the man to tolerate these illegalities, 
corruptions, and indignities. He therefore determined 
on ceasing to use the institution any longer as a place of 
deposit for the public moneys ; and accordingly commu- 
nicated his intention to the Cabinet, all of whom had been 
requested to assist him in his deliberations on the sub- 
ject. The major part of them dissented from his design ; 
whereupon he assembled them on September 22d and 
read to them a paper containing his views on this subject. 
This paper concludes as follows : ' Under these convic- 
tions he feels that a measure so important to the Ameri- 
can people cannot be commenced too soon ; and he there- 
fore names the first day of October next as a period 


proper for the change of the deposits, or sooner, pro- 
vided the necessary arrangements with the State banks 
can be made.' " Secretary Duane refused to carry out 
the wishes of the President without a previous refer- 
ence to Congress. Roger B. Taney, then Attorney- 
General, was made Secretary of the Treasury, and 
issued the order for the removal of the deposits on 
September 26, 1833. 

The opponents of the Administration, looking at the 
surplus revenue, regarded the propositions made for dis- 
tribution of the surplus among the States favorably, as 
tending to deprive the President of a portion of an 
immense patronage. The deposit of the public money 
in the pet banks had been followed by great financial 
distress, continuing during the year 1834 ; and previous 
to and during that year propositions were frequently 
made in the public press for distribution of the surplus 
revenue among the States as a measure of relief. 
These propositions were first in the form of a distribu- 
tion of the revenue from public land, then a distribution 
of the public lands themselves, and finally the distribu- 
tion of both land and customs revenues. 

During the session of 1835, on motion of Mr. Cal- 
houn, a select committee, consisting of Calhoun, Web- 
ster, Benton, Bibb, Southard, and King, were appoint- 
ed to inquire into the extent of executive patronage, 
the increase of public expenditures, and the number of 
persons employed or fed by the executive Government. 
The committee assumed that there would be an annual 
surplus of nine millions for the next eight years. It re- 
garded the disposal of this surplus as a problem to bo 
solved with great difficulty, but one which was import- 


ant to determine, lest the Executive should greatly 
increase his power by depositing the public funds with 
the favorite banks. The committee accordingly "re- 
ported a resolution so to amend the Constitution that 
the money remaining in the treasury at the end of each 
year, till January 1, 1843, deducting therefrom the sum 
of $2,000,000 to meet current and contingent expenses, 
shall annually be distributed among the States and Ter- 
ritories, including the District of Columbia ; and, for 
that purpose, the sum to be distributed to be divided 
into as many shares as there are Senators and llepresent- 
atives in Congress, adding two for each Territory and 
two for the District of Columbia ; and that there shall 
be allotted to each State a number of shares equal to its 
representation in both Houses, and to the Territories, 
including the District of Columbia, two shares each. 
Supposing the surplus to be distributed should average 
$9,000,000 annually, as estimated, it would give to each 
share $30,405, which, multiplied by the number of Sen- 
ators and Representatives from a State, will show the 
amount to which any State will be entitled." 

This resolution was opposed by Benton, who repre- 
sented the Administration in the Senate. He argued 
that the customs revenues could he largely reduced by 
changes in their methods of collection ; that the reve- 
nues from the sale of land could be made to disappear by 
selling these lands at nominal prices to the people. If, 
after this, there should still be a surplus, he advocated its 
use in the construction of fortifications to protect the 
coasts and frontiers of the country. The proposition of 
the committee to amend the Constitution to authorize 
the distribution was never brought to a vote. 


In the spring of 1836 the following paragraph ap- 
peared in the Philadelphia National Gazette: "The 
great loss of the bank has been in the depreciation of 
the securities, and the only way to regain a capital 
is to restore their value. A large portion of them 
consists of State stocks, which are so far below their 
intrinsic worth that the present prices could not have 
been anticipated by any reasonable man. !No doubt 
can be entertained of their ultimate payment. The 
States themselves, unaided, can satisfy every claim 
against them ; they will do it speedily if Congress adopt 
the measures contemplated for their relief. A division 
of the public lands among the States, which would en- 
able them all to pay their debts, or a pledge of the pro- 
ceeds of sales for that purpose, would be abundant secur- 
ity. Either of these acts would inspire confidence and 
enhance the value of all kinds of property." A bill for 
the distribution of the revenues was introduced in the 
Senate, and supported both by Mr. Clay and Mr. Web- 
ster. It was opposed by Mr. Benton, who introduced 
an antagonistic bill devoting the surplus revenues to 
public defences. The bill passed the Senate by a vote 
of 25 to 20. 

Being sent to the House for concurrence, it became 
evident that it could not pass that body, as a majority 
of its members regarded the project in its form of a 
distribution as unconstitutional. The friends of the 
measure in the Senate determined to change its form so 
as to remove the difficulty. Instead of a distribution it 
was to be a deposit, and the faith of the States was to 
be pledged to the return of the money. There was an- 
other bill in the Senate for regulating the deposit of 


public moneys with the State banks, and the proposi- 
tion in the form of a deposit with the States became 
sections thirteen and fourteen of this bill, which passed 
with only six dissenting votes. It passed the House by 
i large majority, 155 to 38. In the form of distribution 
it had no chance of passing the House. "It was ap- 
proved by the President," Benton says, "but with a re- 
pugnance of feeling and a recoil of judgment which it 
required great effort of friends to overcome." Probably, 
if he had returned it with his veto, it would have had 
two-thirds of each House in, its favor. 

The following is a copy of the thirteenth and fourteenth 
sections of the act of June 23, 1836 : " An act to regulate 
the deposits of the public money." " Section 13. That the 
money which shall be in the treasury of the United States 
on the first day of January, eighteen hundred and thirty- 
seven, reserving the sum of five millions of dollars, shall 
be deposited with such of the several States, in propor- 
tion to their respective representation in the Senate and 
House of Representatives of the United States, as shall, 
by law, authorize their Treasurers, or other competent 
authorities, to receive the same on the terms hereinafter 
specified ; and the Secretary of the Treasury shall deliver 
the same to such Treasurers, or other competent authori- 
ties, on receiving certificates of deposit therefor, signed 
by such competent authorities, in such form as may be 
prescribed by the Secretary aforesaid ; which certificates 
shall express the usual and legal obligations, and pledge 
the faith of the State for the safe-keeping and repayment 
thereof, and shall pledge the faith of the States receiv- 
ing the same, to pay the said moneys, and every part 
thereof, from time to time, whenever the same shall be 


required by the Secretary of the Treasury, for the pur- 
pose of defraying any wants of the public treasury, be- 
yond the amount of the five millions aforesaid : Provided, 
that if any State declines to receive its proportion of the 
surplus aforesaid, on the terms before named, the same 
shall be deposited with the other States, agreeing to ac- 
cept the same on deposit in the proportion aforesaid : 
And provided, furthef, that when said money, or any 
part thereof, shall be wanted by the said Secretary, to 
meet appropriations by law, the same shall be called for 
in ratable proportions, within one year, as nearly as con- 
veniently may be, from the different States with which 
the same is deposited, and shall not be called for, in 
sums exceeding ten thousand dollars, from any one 
State, in any one month, without previous notice of 
thirty days for every additional sum of twenty thousand 
dollars which may at any time be required. Section 14. 
And be it further enacted, That the said deposits shall 
be made with the said States in the following propor- 
tions and at the following times, to wit : one-quarter 
part on the first day of January, eighteen hundred and 
thirty-seven, or as soon thereafter as may be ; one-quar- 
ter part on the first day of April, one-quarter part on 
the first day of July, and one-quarter part on the first 
day of October, all in the same year." 

In his message for December, 1836, President Jack- 
son objected to the method of distribution provided 
in the law, viz., according to representation, and ad- 
vocated a method founded on the population of each 

On January 1, 1837, the surplus in the treasury, after 
reserving the five millions required by law, was $37,- 



468,869.97, and the apportionment among the several 
States is shown by the following table : 


of elec- 

Amount to be 
deuosited during 
the year 1837. 





Rhode Island .... 

New York 

New Jersey 






Indiana . .... 


Arkansas . . 




The above table, with the exception of the last column, 
is copied from the report of Mr. Woodbury to Con- 
gress, of January 3, 1837. It will be noticed that 
by the law authorizing the deposit of the surplus, 
each State was required to authorize its Treasurer by 


law to receive the deposit and to give certificates of 
deposit therefor. The necessary forms for carrying ovit 
this plan were prepared by the Secretary of the Treas- 
ury, and rnay be found in Ex. Doc. and Reports of 
Committees, 1st Sess. 25th Congress, Doc. No. 30. All 
of the States named in the foregoing table of apportion- 
ment passed laws authorizing the receipt of the deposit, 
and some took the opportunity of instructing their rep- 
resentatives to protest against, or to endeavor to obtain 
changes in, some of the features of the law. 

The Legislature of the State of New Hampshire, by 
resolution, declared that any distribution of surplus was 
unconstitutional. They instructed their delegates to 
vote for a reduction of revenue and against any measure 
for relinquishment, by the United States, of the sums on 
deposit with the States. The Legislature of the State of 
Indiana requested its Senators and Representatives to 
use their exertions to procure the passage of an act of 
Congress for the relinquishment, on the part of the 
United States, of all claims of surplus revenue deposits 
under act of June 23, 1836. These resolutions show 
conclusively that these States regarded the money re- 
ceived as a deposit to be likely to be recalled, and not as 
a gift. 

The first three instalments were paid to the States 
as nearly as possible on the following dates, viz. : one- 
fourth on January 1, 1837, one-fourth on April 1st, and 
one-fourth on July 1st, following. The sums were paid 
by transfers from the deposit banks. On November 1, 
1836, the Secretary of the Treasury notified the banks of 
the requisition which would be made upon them to meet 
the instalments due to the several States on January 


1st. On February 18, 183T, lie gave similar notification 
in reference to the next three instalments. Forms of 
the letters sent to each of the deposit banks are given, 
also, in Document 30, September 26, 1837, before re- 
ferred to. The instalments payable on January 1st, 
April 1st, and July 1st, were transferred to the States 
on or near those dates. They amounted in all to 
$28,101,645, and proportionate amounts were deposited 
with and receipted for by each State. 

In May, 1837, the financial pressure became so great 
that the banks generally suspended specie payments. 
The fifth section of the act of June 23, 1836, for regu- 
lating the deposits of public money, provided that no 
bank shall be selected or continued as a place of deposit 
of public money which shall not redeem its notes and 
bills on demand in specie. On May 1, 1837, the num- 
ber of the deposit banks was eighty-eight, distributed 
by States as follows: 

Maine 8 

New Hampshire 4 

Vermont 2 

Massachusetts. . . .6 

North Carolina 1 

South Carolina 2 

Georgia 3 

Alabama. . . ........ 1 

Connecticut 3 Mississippi 2 

Rhode Island 2 j Louisiana 2 

New York 16 Tennessee . . 2 

XewJersey 3 Kentucky 7 

Pennsylvania 3 Ohio . 



District of Columbia 1 

Virginia 3 

Indiana 1 

Illinois 1 

Michigan 2 

Total... .. 88 

The number of deposit banks on November 1, 1836, was 
eighty-nine. Their capital was $77,576,449; United States 


deposits, $49,377,986 ; other deposits, only $26,573,479.' 
The difficulties arising from the necessity of discontinu- 
ing as public depositories those banks which refused to 
pay specie, made it apparent that it would be very in- 
convenient, if not impossible, to transfer the fourth in- 
stalment of the deposit with the States. 

Further legislation was deemed necessary in this emer- 
gency, and an extra session of Congress was called by 
President Yan Buren. Congress met on September 4th. 
Among other reasons for the extra session, the President 
in his message mentioned that " questions were also ex- 
pected to arise in the recess in respect to the October 
instalment of those deposits, requiring the interposition 
of Congress." Secretary Woodbury, in a report made on 
the safe-keeping of the public moneys, on September 
23d, in answer to a resolution of the House of Representa- 
tives, said : " This last mode [viz., deposit with selected 
State banks] ceased by operation of law during the last 
spring, except in relation to five or six deposit banks 
which have continued to redeem their notes in specie. 
The direct losses sustained under it appear to be large. 
But, in the end, they are not considered likely to 
amount to anything, though the disappointments, de- 
lays, and injuries under it must, it is manifest, in sev- 
eral cases be great. The indirect losses to the public 
creditors and contractors have been considerable, and 
are difficult to be computed." From this it will be seen 
that only six out of the eighty-eight banks designated 
as public depositories on May 1st could be used as such 
in September. 

1 For statement of resources and liabilities of these banks, see Re- 
port of Comptroller of the 'Currency, p. 43. 1876. 


Benton says, in relation to these payments : " The 
deposit with the States had only reached its second 
instalment when the deposit banks, unable to stand a 
continued quarterly strain of near ten millions to the 
quarter, gave up the effort, and closed their doors. 
The first instalment had been delivered on January 1st, 
in specie or its equivalent ; the second in April, also in 
valid money ; the third one, demaudable on July 1st, was 
accepted by the States in depreciated paper ; and they 
were very willing to receive the fourth instalment in 
the same way. The Secretary's report shows that there 
would be a deficiency in the revenues to meet expendi- 
tures of over ten millions of dollars, which would render 
it necessary either to recall some of the money deposited 
with the States, or to postpone the payment of the fourth 
instalment due on October 1st. The Secretary men- 
tioned the inconvenience of paying the fourth instal- 
ment, arising from the difficulty of transferring from the 
West and Southwest, where the money received from 
sales of public lands had accumulated. The lack of rev- 
enue was his principal reason for urging the withholding 
or postponement of the fourth instalment. Believing the 
money would be immediately necessary to the Govern- 
ment, he thought it would be less inconvenient to with- 
hold payment than to pay and immediately recall." 

On September 11, 1837, Mr. Silas Wright, from the 
Senate Committee on Finance, reported a bill which pro- 
vided " that the transfer of the fourth instalment of de- 
posits directed to be made with the States, under the 
thirteenth section of the act of June 23, 1836, be and 
the same is hereby postponed until further provision by 
law." The bill was brought up for consideration on the 


14th, when he said that, according to the report of the 
Secretary of the Treasury of the 28th ult., there was then 
in the treasury subject to draft, available and unavail- 
able, but $8,100,000. If the expenses of the month of 
September were deducted, which were estimated at two 
and a half millions, there would be in the treasury, sub- 
ject to draft on October 1st, less than six millions, with- 
out the transfer of a dollar to the States toward the Oc- 
tober instalment. If the October instalment was to be 
transferred to the States, all the means in the treasury 
on the day when that instalment was made transferable 
would not be equal to two-thirds of the amount, and 
money must be borrowed upon the credit of the United 
States to supply the deficiency. The largest portion of 
the funds in the treasury was wholly unavailable ; they 
were in the Western and Southwestern banks, and expe- 
rience had already shown that the drafts of tlie Treas- 
urer upon these banks would not be received in payment 
by the public creditors, neither would the States other 
than those in which the banks were located take these 
drafts, and give their obligations for a repayment of the 
amount in money in pursuance of the provisions of the 
deposit law. The transfer to the States, therefore, could 
not be made, even to the amount of the funds in the 
treasury subject to draft, by reason of the character of 
the funds to be drawn upon. 

The whole means in the treasury on the first day of 
October next would be from three and a half to four 
millions less than the transfer required. If Congress 
should insist upon this transfer, it must authorize a loan 
of money upon the public credit in order that that 
money, when loaned, may be deposited with the States 


for safe-keeping. Mr. Webster thought that it was a 
mere question of convenience, the distributed money 
would go to all the people, and any deficiency in the 
treasury must be supplied by all the people. He 
thought the most convenient way was to pay the instal- 
ment, and provide for the necessities of the treasury by 
other means. Mr. Preston opposed the bill on the 
ground that many States had already appropriated the 
money, and had undertaken public works on the strength 
of it, etc. Mr. Crittenden, of Kentucky, opposed it on 
the same ground. By other Senators the deposit act 
was treated as a contract which the United States was 
bound to carry out. 

Mr. Buchanan proposed an amendment, the effect of 
which was to change the character of the deposit act 
and make it a distribution measure. By the act it was 
the du,ty of the Secretary of the Treasury to call for a 
return of the deposit when needed by the Federal 
Treasury. The amendment superseded this, and enacted 
that the deposits should remain until called for by Con- 
gress. Mr. Xiles pointed out the effect of this amend- 
ment. He said the majority of those who voted for the 
deposit act did so because it was a deposit and not a 
distribution, and merely withdrew the public moneys 
from the banks and deposited them with the States. 
The amendment would change the deposit to a loan, or, 
more properly, a grant, to the States. Mr. Buchanan's 
amendment, however, passed by a vote of 32 to 12, and 
thus the recall of the deposits already made was taken 
from the hands of the States and placed with Congress. 

In the House of Representatives the disposition to re- 
gard the deposit act as a contract was even stronger than 


in the Senate. Mr. Caleb Gushing argued that it had 
all the features of a contract, that it was a " contract of 
deposit." It was a contract in honor, and, as far as 
there could be a contract between the United States and 
the States, a contract in law. 

On the other hand, it was argued very forcibly that 
neither in honor nor in law was there any reason for 
paying the fourth instalment when there was no surplus 
in the treasury. Mr. Halsted, on the same side, said : 
" In reference to the deposit act, if a contract, it was a 
contract based alone upon the distribution of an existing 
surplus, not wanted for the ordinary or extraordinary 
expenditures of the Government. The structure was 
reared upon that rock, and was so understood at the 
time the statute was enacted. The money to be dis- 
tributed was out of a surplus fund. Where was there 
a surplus fund ? There was none." 

The opponents of the bill, apart from the argument 
of contract, mainly founded their arguments on the fact 
that the States had been induced to undertake public 
works and other engagements by the promise of the 
money, and the inconvenience to which they would be 
put by withholding the fourth instalment. It was justly 
observed by their opponents that the States should have 
regulated their action by the actual terms of the law of 
Congress, to which they agreed when they accepted the 
deposits. The opposition to the bill was persistent, the 
debate was long, and many members were participants, 
among whom was Adams, of Massachusetts, Fillmore and 
Sibley, of Kew York, Bell, of Tennessee, and Wise, of 
Virginia. It finally passed the House by the close vote 
of 119 to 117. A motion to reconsider was made by 


Mr. Pickens, and carried. On reconsideration, Mr. Pick- 
ens moved to amend so that, instead of postponing the 
payment indefinitely until further action by Congress, 
it be postponed to January 1, 1839, a day certain. This 
amendment was agreed to and concurred in by the Sen- 
ate, and the bill finally passed in that form. 

The effect of the postponement of the payment to a 
fixed day has been held by some to bind the United 
States to such a payment; and the making the with- 
drawal of the first three instalments received by the 
States dependent on an act of Congress has, by the 
same kind of construction, been regarded by some as 
altering what was originally a deposit to a gift. 

As January 1, 1839, approached, it became apparent 
that there would be no funds in the treasury available 
for the deposit of the postponed instalment. The Sec- 
retary of the Treasury, in his report for December, 

1838, stated that the available balance on January 1, 

1839, would be $2,765,342 only, and at the date of the 
report the treasury notes outstanding amounted to over 
$7,754,560. He said : " It will be perceived by these 
statements that no surplus balance will probably exist, 
either on January 1, 1839, or during that year, to be 
deposited with the several States for safe-keeping as a 
fourth instalment under the deposit act of June 23, 

Since January 1, 1839, there has never been a time 
when the United States had in its treasury a surplus 
over and above all its debts and estimated expenditures. 
The amount deposited in the first three instalments with 
the States has always been carried as funds of the treas- 
ury unavailable ; and under the terms of the acts rela- 


tive to its deposit, it could now be recalled at any time 
by an act of Congress. 

General John A. Dix, Secretary of the Treasury, 
in a letter to the Chairman of the Committee of Ways 
and Means, of January 18, 1861, called attention to 
the fact that " there are deposited with twenty-six of 
the States, for safe-keeping, over twenty-eight mil- 
lions of dollars belonging to the United States, for 
the payment of which the promise of these States is 
pledged by written instruments on file in this depart- 
ment. The annual statement of receipts and expendi- 
tures for the year ending June 30, 1860, represents this 
amount as part of ' the balance in the treasury ' on that 
day. * * I refer to this final resource as an avail- 
able one, should the public exigencies demand it. It is 
not doubted that the greater portion of the amount so 
deposited would be promptly and cheerfully paid should 
an exigency arise involving the public honor or safety. 
If, instead of calling for these deposits, it should be 
deemed advisable to pledge them for the repayment of 
any money the Government might find it necessary to 
borrow, loans contracted on such a basis of security, su- 
peradding to the plighted faith of the United States 
that of the individual States, could hardly fail to be ac- 
ceptable to the capitalists." 

It is easy to see that there can be no constitutional 
authority for the claim that this money, already in the 
possession of the States, irrevocably belongs to them, 
since, according to the Constitution, it is still in the 
treasury of the United States. The only method of tak- 
ing money out of the treasury is by an appropriation by 
Congress, upon which the Secretary of the Treasury is 


authorized to issue his warrant, and no such method was 
ever adopted in relation to this money. The whole ob- 
ject and intention of the act was to deposit the surplus, 
not distribute it, as it has been seen that a distribution 
act was known at the time to be unconstitutional. Upon 
the delivery of the money the Treasurer of each State 
gave to the United States, not a receipt, but a certificate 
of deposit, subject to the future requisition of the Gov- 
ernment. The amount of the deposit has always been 
held among the " unavailable funds of the treasury," 
and is annually so reported among other like funds, as 
may be seen by reference to page 383, Finance Report, 
1882, and previous reports. But whether a deposit or a 
distribution, no constitutional method has been taken to 
authorize the payment of the money out of the treasury. 
Moreover, it was a deposit of surplus and surplus only, 
and when the surplus did not exist was suspended by 
act of Congress until a certain date ; and when at that 
date there was still no surplus, the deposit was again 
withheld by the Executive, and, on the same principle, 
has been withheld ever since. Congress at any time 
can authorize the withdrawal of the whole amount from 
the States, and it doubtless could authorize the perpet- 
ual withholding of the fourth instalment in view of the 
fact that at some time in the future, after the national 
debt is paid, there may be a surplus similar to that 
which existed January 1, 1877. 

Benton, in his " Thirty Years' Yiew," thus refers to 
the use made of the deposits by the different States : 
" All sorts of plans were proposed for the employment 
of the money ; and combinations, more or less interested 
or designing, generally carried the point in the universal 


scramble. In some States a pro rata division of the 
money per capita was made ; and the distributive share 
of each individual, being but a few shillings, was re- 
ceived with contempt by some, and rejected with scorn 
by others. In other States it was divided among the 
counties, and gave rise to disjointed undertakings of no 
general benefit. Others, again, were stimulated, by the 
unexpected acquisition of a large sum, to engage in large 
and premature works of internal improvement, embar- 
rassing the State with debt, and commencing works 
which could not be finished." 

This paragraph conveys a wrong impression. It is 
generally believed that the moneys deposited by the 
Government with the different States were, for the most 
part, wasted or employed in works of internal improve- 
ment which were unnecessary. The data for a full in- 
vestigation of this subject are not at hand, but it is 
known that the States of Massachusetts, Connecticut, 
New York, New Jersey, Pennsylvania, Delaware, Mary- 
land, North Carolina, Illinois, Indiana, Kentucky, Ohio, 
and Missouri appropriated a considerable portion of the 
income from this fund to the support of public schools ; 
and that in some of these States the income from the 
whole fund has been from the commencement, and still 
is, devoted to the education of the people. In some in- 
stances the States used the funds for internal improve- 
ments, but provided by legislation for the appropriation 
of an amount equal to the interest for the support of 
public schools, which was similar to an investment in 
the bonds of the State. 

A claim has been made within a few months (1884) 
upon the Secretary of the Treasury, under authority of 


an act passed by the Legislature of the State of Vir- 
ginia, for the deposit of the amount of the fourth in- 
stalment ($732,809.33) under the act of June 23, 1836. 
A similar claim has also been made by the Treasurer of 
the State of Arkansas, through Senator Garland, of 
that State, to which the Secretary replied, on October 
8, 1883 : " I find that the tradition of this department 
for over a dozen years has been to consider that act as 
obsolete, or at least not imperatively effective during a 
season of large public federal indebtedness. I can for 
the present follow in the path of my predecessors in the 
office of the Secretary of the Treasury." 

A petition was subsequently made to the Supreme 
Court of the United States, by the State of Virginia, 
through its properly authorized agent, for a writ of 
mandamus upon the Secretary of the Treasury, to com- 
pel him to pay to that State the amount of the fourth 
instalment of surplus alleged to be due under the 
provisions of the act of June 23, 1836. The court, on 
March 17, 1884, held that there was no case for a man- 
damus, and that the Secretary of the Treasury has no 
authority under existing legislation, and without further 
direction from Congress, to use the surplus revenue in 
the treasury, from whatever source derived, or when- 
ever, since January 1, 1839, it may have accrued, for 
the purpose of making the fourth instalment of deposit 
required by the act of 1836. 



No. 9. October Term, 1883. 

AUGUSTUS D. JUILLIABD, plaintiff in error, vs. THOMAS S. 
GREENMAX. In error to the Circuit Court of the United States 
for the Southern District of New York 

Congress has the constitutional power to make the treasury 
notes of the United States a legal tender in payment of private 
debts in time of peace as well as in time of war. 

Under the act of May 31, 1878, chapter 146, which enacts 
that notes of the United States issued during the war of the 
rebellion under acts of Congress declaring them to be a legal 
tender in payment of private debts, and since the close of that 
war redeemed and paid in gold coin at the treasury, shall be 
reissued and kept in circulation, notes so reissued are a legal 

[March 3, 1884.] 

Mr. Justice GRAY delivered the opinion of the court. 

Juilliard, a citizen of New York, brought an action against 
Greenman, a citizen of Connecticut, in the Circuit Court of the 
United States for the Southern District of New York, alleging 
that the plaintiff sold and delivered to the defendant, at his 
special instance and request, one hundred bales of cotton, of 
the value and for the agreed price of $5,122.90, and that the 
defendant agreed to pay that sum in cash on the delivery of 
the cotton, and had not paid the same, or any part thereof, 
except that he had paid the sum of $22.90 on account, and was 
now justly indebted to the plaintiff therefor in the sum of 


$5,100, and demanding judgment for this sum -with interest and 

The defendant in his answer admitted the citizenship of the 
parties, the purchase and delivery of the cotton, and the agree- 
ment to pay therefor, as alleged ; and averred that after the 
delivery of the cotton he offered and tendered to the plaintiff, 
in full payment, $22.50 in gold coin of the United States, forty 
cents in silver coin of the United States, and two United States 
notes, one of the denomination of $5,000 and the other of the 
denomination of $100, of the description known as United 
States legal-tender notes, purporting by recital thereon to be 
legal tender, at their respective face values, for all debts, public 
and private, except duties on imports and interest on the 
public debt, and which, after having been presented for pay- 
ment, and redeemed and paid in gold coin, since January 1, 
1879, at the United States sub-Treasury in New York, had been 
reissued" and kept in circulation under and in pursuance of 
the act of Congress of May 31, 1878, chapter 146 ; that at the 
time of offering and tendering these notes and coin to the 
plaintiff the sum of $5,122.90 was the entire amount due and 
owing in payment for the cotton, but the plaintiff declined to 
receive the notes in payment of $5,100 thereof ; and that the 
defendant had ever since remained, and still was, ready and 
willing to pay to the plaintiff the sum of $5, 100 in these notes, 
and brought these notes into court, ready to be paid to the 
plaintiff if he would accept them. 

The plaintiff demurred to the answer upon the grounds that 
the defence, consisting of new matter, was insufficient in law 
upon its face, and that the facts stated in the answer did not 
constitute any defence to the cause of action alleged. 

The Circuit Court overruled the demurrer and gave judgment 
for the defendant, and the plaintiff sued out his writ of error. 

The amount which the plaintiff seeks to recover, and which, 
if the tender pleaded is insufficient in law, he is entitled to 
recover, is $5,100. There can, therefore, be no doubt of the 
jurisdiction of this court to revise the judgment of the Circuit 
Court (act of February 16, 1875, ch. 77, sec. 3 ; 18 Stat., 315). 


The notes of the United States, tendered in payment of the 
defendant's debt to the plaintiff, were originally issued under 
the acts of Congress of February 25, 1862, ch. 33, July 11, 1862, 
ch. 142, and March 3, 1863, ch. 73, passed during the war of 
the rebellion, and enacting that these notes should " be lawful 
money and a legal tender in payment of all debts, public and 
private, within the United States," except for duties on imports 
and interest on the public debt (12 Stat., 345, 532, 709). 

The provisions of the earlier acts of Congress, so far as it is 
necessary for the understanding of the recent statutes to quote 
them, are re-enacted in the following provisions of the Revised 
Statutes : 

" SEC. 3579. When any United States notes are returned to 
the treasury, they may be reissued, from time to time, as the 
exigencies of the public interest may require. 

" SEC. 3580. When any United States notes returned to the 
treasury are so mutilated or otherwise injured as to be unfit 
for use, the Secretary of the Treasury is authorized to replace 
the same with others of the same character and amounts. 

" SEC. 3581. Mutilated United States notes, when replaced 
according to law, and all other notes which by law are required 
to be taken up and not reissued, when taken up shall be de- 
stroyed in such manner and under such regulations as the 
Secretary of the Treasury may prescribe. 

" SEC. 3582. The authority given to the Secretary of the 
Treasury to make any reduction of the currency, by retiring 
and cancelling United States notes, is suspended." 

"SEC. 3588. United States notes shall be lawful money and 
a legal tender in payment of all debts, public and private, with- 
in the United States, except for duties on imports and interest 
on the public debt." 

The act of January 14, 1875, chapter 15, "To provide for 
the resumption of specie payments," enacted, that on and after 
January 1, 1879, " the Secretary of the Treasury shall redeem 
in coin the United States legal-tender notes then outstanding, 
on their presentation for redemption at the office of the Assist- 
ant Treasurer of the United States in the city of New York, in 


sums of not less than fifty dollars ; " and authorized him to use 
for that purpose any surplus revenues in the treasury and the 
proceeds of the sales of certain bonds of the United States (18 
Stat., 296). 

The act of May 31, 1878, chapter 146, under which the notes 
in question were reissued, is entitled " An act to forbid the 
further retirement of United States legal-tender notes," and 
enacts as follows : 

"From and after the passage of this act it shall not be lawful 
for the Secretary of the Treasury or other officer under Mm to 
cancel or retire any more of the United States legal-tender 
notes. And when any of said notes may be redeemed or be 
received into the treasury under any law, from any source 
whatever, and shall belong to the United States, they shall not 
be retired, cancelled, or destroyed, but they shall be reissued 
and paid out again and kept in circulation : Provided, that 
nothing herein shall prohibit the cancellation and destruction 
of mutilated notes, and the issue of other notes of like denomi- 
nation in their stead, as now provided by law. All acts and 
parts of acts in conflict herewith are hereby repealed" (20 
Stat., 87). 

The manifest intention of this act is that the notes which it 
directs, after having been redeemed, to be reissued and kept in 
circulation, shall retain their original quality of being a legal 

The single question, therefore, to be considered, and upon 
the answer to which the judgment to be rendered between 
these parties depends, is whether notes of the United States, 
issued in time of war, under acts of Congress declaring them to 
be a legal tender in payment of private debts, and afterward in 
time of peace redeemed and paid in gold coin at the treasury, 
and then reissued under the act of 1878, can, under the Consti- 
tution of the United States, be a legal tender in payment of 
such debts. 

Upon full consideration of the case, the court is unanimously 
of opinion that it cannot be distinguished in principle from the 
cases heretofore determined, reported under the names of the 


Legal-tender Cases, 12 Wall., 457 ; Dooly vs. Smith, 13 Wall., 
604 ; Railroad Company vs. Johnson, 15 Wall., 195 ; and Mary- 
land vs. Railroad Company, 22 Wall., 105; and all the judges, 
except Mr. Justice Field, who adheres to the views expressed 
in his dissenting opinions in those cases, are of opinion that 
they were rightly decided. 

The elaborate printed briefs submitted by counsel in this 
case, and the opinions delivered in the Legal-tender Cases, and 
in the earlier case of Hepburn vs. Griswold, 8 Wall., 603, which 
those cases overruled, forcibly present the arguments on either 
side of the question of the power of Congress to make the 
notes of the United States a legal tender in payment of private 
debts. Without undertaking to deal with all those arguments, 
the court has thought it fit that the grounds of its judgment in 
the case at bar should be fully stated. 

No question of the scope and extent of the implied powers of 
Congress tinder the Constitution can be satisfactorily discussed 
without repeating much of the reasoning of Chief Justice Mar- 
shall in the great judgment in McCulloch vs. Maryland, 4 
Wheat., 316, by which the power of Congress to incorporate a 
bank was demonstrated and affirmed, notwithstanding the 
Constitution does not enumerate, among the powers granted, 
that of establishing a bank or creating a corporation. 

The people of the United States by the Constitution estab- 
lished a National Government, with sovereign powers, legis- 
lative, executive, and judicial. " The Government of the 
Union," said Chief Justice Marshall, "though limited in its 
powers, is supreme within its sphere of action ; " " and its laws, 
when made in pursuance of the Constitution, form the supreme 
law of the land." " Among the enumerated powers of Govern- 
ment we find the great powers to lay and collect taxes ; to 
borrow money ; to regulate commerce ; to declare and conduct 
a war ; and to raise and support armies and navies. The sword 
and the purse, all the external relations, and no inconsiderable 
portion of the industry of the nation are entrusted to its govern- 
ment" (4 Wheat., 405, 406, 407). 

A constitution establishing a frame of government, declaring 


fundamental principles, and creating a national sovereignty, 
and intended to endure for ages, and to be adapted to the 
various crises of human affairs, is not to be interpreted with 
the strictness of a private contract. The Constitution of the 
United States, by apt words of designation or general descrip- 
tion, marks the outlines of the powers granted to the National 
Legislature, but it does not undertake with the precision and 
detail of a code of laws to enumerate the subdivisions of those 
powers or to specify all the means by which they may be 
carried into execution. Chief Justice Marshall, after dwelling 
upon this view, as required by the very nature of the Consti- 
tution, by the language in which it is framed, by the limita- 
tions upon the general powers of Congress introduced in the 
ninth section of the first article, and by the omission to use any 
restrictive term which might prevent its receiving a fair and 
just interpretation, added these emphatic words : " In consider- 
ing this question, then, we must never forget that it is a con- 
stitution we are expounding" (4 Wheat., 407. See also page 

The breadth and comprehensiveness of the words of the 
Constitution are nowhere more strikingly exhibited than in re- 
gard to the powers over the subjects of revenue, finance, and 
currency, of which there is no other express grant than may be 
found in these few brief clauses : 

' ' The Congress shall have power to lay and collect taxes, 
duties, imposts, and excises, to pay the debts and provide for 
the common defence and general welfare of the United States ; 
but all duties, imposts, and excises shall be uniform through- 
out the United States ; 

' ' To borrow money on the credit of the United States ; 

' ' To regulate commerce with foreign nations, and among the 
several States, and with the Indian tribes ; 

" To coin money, regulate the value thereof, and of foreign 
coin, and fix the standard of weights and measures." 

The section which contains the grant of these and other 
principal legislative powers concludes by declaring that the 
Congress shall have power " to make aU laws which shall be 


necessary and proper for carrying into execution the foregoing 
powers, and all other powers vested by this Constitution in the 
Government of the United States, or in any department or 
officer thereof." 

By the settled construction and the only reasonable inter- 
pretation of this clause the words " necessary and proper " are 
not limited to such measures as are absolutely and indispen- 
sably necessary, without which the powers granted must fail of 
execution ; but they include all appropriate means which are 
conducive or adapted to the end to be accomplished, and 
which in the judgment of Congress will most advantageously 
effect it. 

That clause of the Constitution which declares that " the Con- 
gress shall have power to lay and collect taxes, duties, imposts, 
and excises, to pay the debts and provide for the common 
defence and general welfare of the United States " either em- 
bodies a grant of power to pay the debts of the United States, 
or presupposes and assumes that power as inherent in the 
United States as a sovereign government. But in whichever 
aspect it be considered, neither this nor any other clause of the 
Constitution makes any mention of priority or preference of 
the United States as a creditor over other creditors of an indi- 
vidual debtor. Yet this court, in the early case of United 
States vs. Fisher (2 Cranch, 358), held that under the power to 
pay the debts of the United States, Congress had the power 
to enact that debts due to the United States should have that 
priority of payment out of the estate of an insolvent debtor 
which the law of England gave to debts due to the crown. 

In delivering judgment in that case Chief Justice Marshall 
expounded the clause giving Congress power to make all neces- 
sary and proper laws as follows : "In construing this clause it 
would be incorrect and would produce endless difficulties if the 
opinion should be maintained that no law was authorized which 
was not indispensably necessary to give effect to a specified 
power. Where various systems might be adopted for that pur- 
pose it might be said with respect to each that it was not 
necessary because the end might be obtained by other means. 


Congress must possess the choice of means, and must be em- 
powered to use any means which are, in fact, conducive to the 
exercise of a power granted by the Constitution. The Govern- 
ment is to pay the debt of the Union, and must be authorized 
to use the means which appear to itself the most eligible to 
effect that object " (2 Cranch, 396). 

In McCulloch vs. Maryland he more fully developed the same 
view, concluding thus: "We admit, as all must admit, that 
the powers of the Government are limited, and that its limits 
are not to be transcended. But we think the sound construc- 
tion of the Constitution must allow to the National Legislature 
that discretion with respect to the means by which the powers 
it confers are to be carried into execution, which will enable 
that body to perform the high duties assigned to it in the 
manner most beneficial to the people. Let the end be legiti- 
mate, let it be within the scope of the Constitution, and all 
means which are appropriate, which are plainly adapted to 
that end, which are not prohibited, but consist with the letter 
and spirit of the Constitution, are constitutional " (4 Wheat., 

The rule of interpretation thus laid down has been con- 
stantly adhered to and acted on by this court, and was ac- 
cepted as expressing the true test by all the judges who took 
part in the former discussions of the power of Congress to make 
the treasury notes of the United States a legal tender in pay- 
ment of private debts. 

The other judgments delivered by Chief Justice Marshall 
contain nothing adverse to the power of Congress to issue 
legal-tender notes. 

By the articles of confederation of 1777, the United States in 
Congress assembled were authorized "to borrow money or 
emit bills on the credit of the United States ; " but it was 
declared that " each State retains its sovereignty, freedom, and 
independence, and every power, jurisdiction, and right which 
is not by this confederation expressly delegated to the United 
States in Congress assembled" (Art. 2 ; Art. 9, Sec. 5; 1 Stat., 
4, 7). Yet, upon the question whether, under those articles. 


Congress, by virtue of the power to emit bills on the credit of 
the United States, had the power to make bills so emitted a 
legal tender, Chief Justice Marshall spoke very guardedly, say- 
ing : " Congress emitted bills of credit to a large amount, and 
did not, perhaps could not, make them a legal tender. This 
power resided in the States " (Craig vs. Missouri, 4 Pet., 410, 
435). But in the Constitution, as he had before observed in 
McCulloch vs. Maryland, "there is no phrase which, like the 
articles of confederation, excludes incidental or implied powers, 
and which requires that everything granted shall be expressly 
and minutely described. Even the tenth amendment, which 
was framed for the purpose of quieting the excessive jealousies 
which had been excited, omits the word ' expressly,' and de- 
clares only that the powers ' not delegated to the United States, 
nor prohibited to the States, are reserved to the States or to the 
people ; ' thus leaving the question whether the particular power 
which may become the subject of contest has been delegated to 
the one government or prohibited to the other to depend on a 
fair construction of the whole instrument. The men who drew 
and adopted this amendment had experienced the embarrass- 
ments resulting from the insertion of this word in the articles 
of confederation, and probably omitted it to avoid those em- 
barrassments " (4 Wheat., 405, 406). 

The sentence sometimes quoted from his opinion in Sturges 
vs. Crowninshield had exclusive relation to the restrictions 
imposed by the Constitution on the powers of the States, and 
especial reference to the effect of the clause prohibiting the 
States from passing laws impairing the obligation of contracts, 
as will clearly appear by quoting the whole paragraph : " Was 
this general prohibition intended to prevent paper money? 
We are not allowed to say so, because it is expressly provided 
that no State shall ' emit bills of credit ; ' neither could these 
words be intended to restrain the States from enabling debtors 
to discharge their debts by the tender of property of no real 
value to the creditor, because for that subject also particular 
provision is made. Nothing but gold and silver coin can be 
made a tender in payment of debts" (4 Wheat., 122, 204). 


Such reports as have come down to us of the debates in the 
convention that framed the Constitution afford no proof of any 
general concurrence of opinion upon the subject before us. 
The adoption of the motion to strike out the words " and emit 
bills " from the clause " to borrow money and emit bills on the 
credit of the United States " is quite inconclusive. The philip- 
pic delivered before the Assembly of Maryland by Mr. Martin, 
one of the delegates from that State, who voted against the 
motion, and who declined to sign the Constitution, can hardly 
be accepted as satisfactory evidence of the reasons or the 
motives of the majority of the convention (see 1 Elliot's 
Debates, 345, 370, 376). Some of the members of the conven- 
tion, indeed, as appears by Mr. Madison's minutes of the de- 
bates, expressed the strongest opposition to paper money. 
And Mr. Madison has disclosed the grounds of his own action 
by recording that " this vote in the affirmative by Virginia was 
occasioned by the acquiescence of Mr. Madison, who became 
satisfied that striking out the words would not disable the 
Government from the use of public notes, so far as they could 
be safe and proper ; and would only cut off the pretext for a 
paper currency, and particularly for making the bills a tender 
either for public or private debts." 

But he has not explained why he thought that striking out 
the words ' ' and emit bills " would leave the power to emit bills, 
and deny the power to make them a tender in payment of 
debts. And it cannot be known how many of the other dele- 
gates, by whose vote the motion was adopted, intended neither 
to proclaim nor to deny the power to emit paper money, 
and were influenced by the argument of Mr. Gorham, who 
" was for striking out, without inserting any prohibition," and 
who said : " If the words stand, they may suggest and lead to 
the emission." " The power, so far as it will be necessary or 
safe, will be involved in that of borrowing " (5 Elliot's De- 
bates, 434, 435, and note). And after the first clause of the 
tenth section of the first article had been reported in the form 
in which it now stands, forbidding the States to make anything 
but gold or silver coin a tender in payment of debts, or to pass 


any law impairing the obligation of contracts, when Mr. Gerry, 
as reported by Mr. Madison, " entered into observations incul- 
cating the importance of public faith, and the propriety of the 
restraint put on the States from impairing the obligation of 
contracts, alleging that Congress ought to be laid under the 
like prohibitions," and made a motion to that effect, he was 
not seconded (ib., 546). As an illustration of the danger of 
giving too much weight upon such a question to the debates 
and the votes in the convention, it may also be observed that 
propositions to authorize Congress to grant charters of incor- 
poration for national objects were strongly opposed, especially 
as regarded banks, and defeated (ib., 440, 543, 544). The 
power of Congress to emit bills of credit, as well as to incor- 
porate national banks, is now clearly established by decisions 
to which we shall presently refer. 

The words "to borrow money," as used in the Constitution, 
to designate a power vested in the National Government, for 
the safety and welfare of the whole people, are not to receive 
that limited and restricted interpretation and meaning which 
they would have in a penal statute, or in an authority conferred, 
by law or by contract, upon trustees or agents for private pur- 

The power ' ' to borrow money on the credit of the United 
States " is the power to raise money for the public use on a 
pledge of the public credit, and may be exercised to meet 
either present or anticipated expenses and liabilities of the 
Government. It includes the power to issue, in return for the 
money borrowed, the obligations of the United States in any 
appropriate form, of stock, bonds, bills, or notes ; and in what- 
ever form they are issued, being instruments of the National 
Government, they are exempt from taxation by the governments 
of the several States (Western vs. Charleston City Council, 2 
Pet., 449 ; Banks vs. Mayor, 7 Wall., 16 ; Bank vs. Supervisors, 
7 Wall., 26). Congress has authority to issue these obligations 
in a form adapted to circulation from hand to hand in the 
ordinary transactions of commerce and business. In order to 
promote and facilitate such circulation, to adapt them to use as 


currency, and to make them more current in the market, it may 
provide for their redemption in coin or bonds, and may make 
them receivable in payment of debts to the Government. So 
much is settled beyond doubt, and was asserted or distinctly 
admitted by the judges who dissented from the decision in the 
Legal-tender Cases, as well as by those who concurred in that 
decision (Veazie Bank vs. Fenno, 8 Wall., 533, 548 ; Hepburn 
TS. Griswold, 8 Wall., 616, 636 ; Legal-tender Cases, 12 Wall., 
543, 544, 560, 582, 610, 613, 637). 

It is equally well settled that Congress has the power to in- 
corporate national banks, with the capacity, for their own profit 
as well as for the use of the Government in its money trans- 
actions, of issuing bills which under ordinary circumstances 
pass from hand to hand as money at their nominal value, and 
which, when so current, the law has always recognized as a 
good tender in payment of money debts, unless specifically 
objected to at the time of the tender (United States Bank vs. 
Bank of Georgia, 10 Wheat., 333, 347; Ward vs. Smith, 7 Wall., 
447, 451). The power of Congress to charter a bank was main- 
tained in McCulloch vs. Maryland, 4 Wheat., 316, and in Os- 
born vs. United States Bank, 9 Wheat., 738, chiefly upon the 
ground that it was an appropriate means for carrying on the 
money transactions of the Government. But Chief Justice 
Marshall said : " The currency which it circulates, by means of 
its trade with individuals, is believed to make it a more fit 
instrument for the purposes of government than ifc could other- 
wise be ; and, if this be true, the capacity to carry on this trade 
is a faculty indispensable to the character and objects of the 
institution " (9 Wheat., 864). And Mr. Justice Johnson, who 
concurred with the rest of the court in upholding the power to 
incorporate a bank, gave the further reason that it tended to 
give effect to " that power over the currency of the country 
which the f ramers of the Constitution evidently intended to give 
to Congress alone " (ib., 873). 

The constitutional authority of Congress to provide a cur- 
rency for the whole country is now firmly established. In 
Veazie Bank vs. Fenno, 8 Wall., 533, 548, Chief Justice Chase, 


in delivering the opinion of the court, said : "It cannot be 
doubted that under the Constitution the power to provide a 
circulation of coin is given to Congress. And it is settled by 
the uniform practice of the Government, and by repeated deci- 
sions, that Congress may constitutionally authorize the emission 
of bills of credit." Congress, having undertaken to supply a 
national currency, consisting of coin, of treasury notes of the 
United States, and of bills of national banks, is authorized to 
impose on all State banks, or national banks, or private bankers, 
paying out the notes of individuals or of State banks, a tax of 
ten per cent, upon the amount of such notes so paid out 
(Veazie Bank vs. Fenno, above cited ; National Bank vs. United 
States, 101 U. S., 1). The reason for this conclusion was stated 
by Chief Justice Chase, and repeated by the present Chief 
Justice, in these words : ' ' Having thus, in the exercise of un- 
disputed constitutional powers, undertaken to provide a cur- 
rency for the whole country, it cannot be questioned that 
Congress may, constitutionally, secure the benefit of it to the 
people by appropriate legislation. To this end, Congress has 
denied the quality of legal tender to foreign coins, and has 
provided by law against the imposition of counterfeit and base 
coin on the community. To the same end, Congress may re- 
strain, by suitable enactments, the circulation as money of any 
notes not issued under its own authority. Without this power, 
indeed, its attempts to secure a sound and uniform currency for 
the country must be futile " (8 Wall., 549 ; 101 U. S., 6). 

By the Constitution of the United States the several States 
are prohibited from coining money, emitting bills of credit, or 
making anything but gold and silver coin a tender in payment 
of debts. But no intention can be inferred from this to deny 
to Congress either of these powers. Most of the powers granted 
to Congress are described in the eighth section of the first 
article ; the limitations intended to be set to its powers, so as 
to exclude certain things which might otherwise be taken to be 
included in the general grant, are defined in the ninth section ; 
the tenth section is addressed to the States only. This section 
prohibits the States from doing some things which the United 


States are expressly prohibited from doing, as well as from 
doing some things which the United States are expressly au- 
thorized to do, and from doing some things which are neither 
expressly granted nor expressly denied to the United States. 
Congress and the States equally are expressly prohibited from 
passing any bill of attainder or ex post facto law, or granting 
any title of nobility. The States are forbidden, while the Pres- 
ident and Senate are expressly authorized, to make treaties. The 
States are forbidden, but Congress is expressly authorized, to 
coin money. The States are prohibited from emitting bills of 
credit ; but Congress, which is neither expressly authorized nor 
expressly forbidden to do so, has, as we have already seen, been 
held to have the power of emitting bills of credit, and of 
making every provision for their circulation as currency, short 
of giving them the quality of legal tender for private debts 
even by those who have denied its authority to give them this 

It appears to us to follow, as a logical and necessary conse- 
quence, that Congress has the power to issue the obligations of 
the United States in such form, and to impress upon them such 
qualities as currency for the purchase of merchandise and the 
payment of debts, as accord with the usage of sovereign gov- 
ernments. The power, as incident to the power of borrowing 
money and issuing bills or notes of the Government for money 
boiTOwed, of impressing upon those bills or notes the quality of 
being a legal tender for the payment of private debts, was a 
power universally understood to belong to sovereignty, in 
Europe and America, at the time of the framing and adoption 
of the Constitution of the United States. The governments of 
Europe, acting through the monarch or the legislature, accord- 
ing to the distribution of powers under their respective consti- 
tutions, had and have as sovereign a power of issuing paper 
money as of stamping coin. This power has been distinctly 
recognized in an important modern case, ably argued and fully 
considered, in which the Emperor of Austria, as King of Hun- 
gary, obtained from the English Court of Chancery an injunc- 
tion against the issue in England, without his license, of notes 


purporting to be public paper money of Hungary (Austria vs. 
Day, 2 Giff., 628, and 3 D. F. & J., 217). The power of issuing 
bills of credit, and making them, at the discretion of the legis- 
lature, a tender in payment of private debts, had long been 
exercised in this country by the several Colonies and States ; 
and during the Eevolutionary War the States, upon the recom- 
mendation of the Congress of the Confederation, had made the 
bills issued by Congress a legal tender (see Craig vs. Missouri, 
4 Pet., 435, 453 ; Briscoe vs. Bank of Kentucky, 11 Pet., 257, 
313, 334-336; Legal-tender Cases, 12 Wall., 557, 558, 622; 
Phillips on American Paper Currency, passim). The exercise of 
this power not being prohibited to Congress by the Constitu- 
tion, it is included in the power expressly granted to borrow 
money on the credit of the United States. 

This position is fortified by the fact that Congress is vested 
with the exclusive exercise of the analogous power of coining 
money and regulating the value of domestic and foreign coin, 
and also with the paramount power of regulating foreign* and 
interstate commerce. Under the power to borrow money on 
the credit of the United States, and to issue circulating notes 
for the money borrowed, its power to define the quality and 
force of those notes as currency is as broad as the like power 
over a metallic currency under the power to coin money and to 
regulate the value thereof. Under the two powers, taken to- 
gether, Congress is authorized to establish a national currency, 
either in coin or in paper, and to make that currency lawful 
money for all purposes, as regards the National Government or 
private individuals. 

The power of making the notes of the United States a legal 
tender in payment of private debts being included in the 
power to borrow money and to provide a national currency, is 
not defeated or restricted by the fact that its exercise may 
affect the value of private contracts. If, upon a just and fair 
interpretation of the whole Constitution, a particular power or 
authority appears to be vested in Congress, it is no constitu- 
tional objection to its existence, or to its exercise, that the prop- 
erty or the contracts of individuals may be incidentally affected. 


The decisions of this court, already cited, afford several ex- 
amples of this. 

Upon the issue of stock, bonds, bills, or notes of the United 
States, the States are deprived of their power of taxation to the 
extent of the property invested by individuals in such obliga- 
tions, and the burden of State taxation upon other private prop- 
erty is correspondingly increased. The ten per cent, tax im- 
posed by Congress on notes of State banks and of private 
bankers not only lessens the value of such notes, but tends 
to drive them, and all State banks of issue, out of existence. 
The priority given to debts due to the United States over the 
private debts of an insolvent debtor diminishes the value of 
these debts, and the amount which their holders may receive 
out of the debtor's estate. 

So, under the power to coin money and to regulate its value, 
Congress may (as it did with regard to gold by the act of June 
28, 1834, ch. 95, and with regard to silver by the act of 
February 28, 1878, ch. 20) issue coins of the same denomina- 
tion as those already current by law, but of less intrinsic value 
than those by reason of containing a less weight of the precious 
metals, and thereby enable debtors to discharge their debts 
by the payment of coins of the less real value. A contract to 
pay a certain sum in money, without any stipulation as to the 
kind of money in which it shall be paid, may always be satis- 
fied by payment of that sum in any currency which is lawful 
money at the place and time at which payment is to be made 
(1 Hale, P. C., 192-194 ; Bac. Ab. Tender, B. 2 ; Pothier, Con- 
tract of Sale, No. 416 ; Pardessus, Droit Commercial, Nos. 204, 
205 ; Searight^s. Calbraith, 4 Dall., 324). As observed by Mr. 
Justice Strong, in delivering the opinion of the court in the 
Legal-tender Cases, " Every contract for the payment of money, 
simply, is necessarily subject to the constitutional power of the 
Government over the currency, whatever that power may be, 
and the obligation of the parties is, therefore, assumed with 
reference to that power" (12 Wall., 549). 

Congress, as the legislature of a sovereign nation, being ex- 
pressly empowered by the Constitution " to lay and collect 


taxes, to pay the debts and provide for the common defence 
and general welfare of the United States," and " to borrow 
money on the credit of the United States," and " to coin money 
and regulate the value thereof and of foreign coin ;" and being 
clearly authorized, as incidental to the exercise of those great 
powers, to emit bills of credit, to charter national banks, and 
to provide a national currency for the whole people, in the 
form of coin, treasury notes, and national bank bills ; and the 
power to make the notes of the Government a legal tender in 
payment of private debts being one of the powers belonging to 
sovereignty in other civilized nations, and not expressly with- 
held from Congress by the Constitution ; we are irresistibly 
impelled to the conclusion that the impressing upon the treas- 
ury notes of the United States the quality of being a legal 
tender in payment of private debts is an appropriate means, 
conducive and plainly adapted to the execution of the un- 
doubted powers of Congress, consistent with the letter and 
spirit of the Constitution, and therefore, within the meaning of 
that instrument, " necessary and proper for carrying into execu- 
tion the powers vested by this Constitution in the Government 
of the United States." 

Such being our conclusion in matter of law, the question 
whether at any particular time, in war or in peace, the exigency 
is such, by reason of unusual and pressing demands on the 
resources of the Government, or of the inadequacy of the 
supply of gold and silver coin to furnish the currency needed 
for the uses of the Government and of the people, that it is, as 
matter of fact, wise and expedient to resort to this means, is a 
political question, to be determined by dongress when the- 
question of exigency arises, and not a judicial question, to be 
afterward passed upon by the courts. To quote once more 
from the judgment in McCulloch vs. Maryland : "Where the 
law is not prohibited, and is really calculated to effect any of 
the objects entrusted to the Government, to undertake here to 
inquire into the degree of its necessity would be to pass the 
line which circumscribes the judicial department^ and to tread 
on legislative ground " (4 Wheat., 423). 


It follows that the act of May 31, 1878, ch. 146, is constitu- 
tional and valid ; and that the Circuit Court rightly held that 
the tender in treasury notes, reissued and kept in circulation 
under that act, was a tender of lawful money in payment of the 
defendant's debt to the plaintiff. 

Judgment affirmed. 

Mr. Justice FIELD wrote a dissenting opinion, as follows : 
From the judgment of the court in this case, and from all 
the positions advanced in its support, I dissent. The question 
of the power of Congress to impart the quality of legal tender 
to the notes of the United States, and thus make them money 
and a standard of value, is not new here. Unfortunately, it 
has been too frequently before the court, and its latest decision, 
previous to this one, has never been entirely accepted and ap- 
proved by the country. Nor should this excite surprise ; for 
whenever it is declared that this Government, ordained to 
establish justice, has the power to alter the condition of con- 
tracts between private parties, and authorize their payment or 
discharge in something different from that which the parties 
stipulated, thus disturbing the relations of commerce and the 
business of the community generally, the doctrine will not and 
ought not to be readily accepted. There will be many who 
will adhere to the teachings and abide by the faith of their 
fathers. So the question has come again, and will continue to 
come until it is settled so as to uphold and not impair the con- 
tracts of parties, to promote and not defeat justice. 

If there be anything in the history of the Constitution which 
can be established with moral certainty, it is that the framers 
of that instrument intended to prohibit the issue of legal-tender 
notes both by the general Government and by the States ; and 
thus prevent interference with the contracts of private parties. 
During the Revolution and the period of the old Confederation, 
the Continental Congress issued bills of credit, and upon its 
recommendation the States made them a legal tender, and the 
refusal to receive them an extinguishment of the debts for 
which they were offered. They also enacted severe penalties 


against those who refused to accept them at their nominal 
value, as equal to coin, in exchange for commodities. And 
previously, as early as January, 1776, Congress had declared 
that, if any person should be "so lost to all virtue and regard 
for his country " as to refuse to receive in payment the bills 
then issued, he should, on conviction thereof, be "deemed, 
published, and treated as an enemy of his country, and pre- 
cluded from all trade and intercourse with the inhabitants of 
the colonies." 

Yet, this legislation proved ineffectual ; the universal law of 
currency prevailed, which makes promises of money valuable 
only as they are convertible into coin. The notes depreciated 
until they became valueless in the hands of their possessors. 
So it always will be ; legislative declaration cannot make the 
promise of a thing the equivalent of the thing itself. 

The legislation to which the States were thus induced to re- 
sort was not confined to the attempt to make paper money a 
legal tender for debts ; but the principle that private contracts 
could be legally impaired, and their obligation disregarded, 
being once established, other measures equally dishonest and 
destructive of good faith between parties were adopted. What 
followed is thus stated by Mr. Justice Story, in his " Commen- 
taries : " 

" The history, indeed," he says, " of the various laws which 
were passed by the States, in their colonial and independent 
character, upon this subject, is startling at once to our morals, 
to our patriotism, and to our sense of justice. Not only was 
paper money issued and declared to be a tender in payment of 
debts, but laws of another character, well known under the 
appellation of tender laws, appraisement laws, instalment laws, 
and suspension laws, were from time to time enacted, which 
prostrated all private credit and all private morals. By some 
of these laws the due payment of debts was suspended ; debts 
were, in violation of the very terms of the contract, authorized 
to be paid by instalments at different periods ; property of any 
sort, however worthless, either real or personal, might be ten- 
dered by the debtor in payment of his debts ; and the creditor 


was compelled to take the properly of the debtor, which he 
might ,seize on execution, at an appraisement wholly dispro- 
portionate to its known value. Such grievances and oppres- 
sions, and others of a like nature, were the ordinary results of 
legislation during the Revolutionary War and the intermediate 
period down to the formation of the Constitution. They en- 
tailed the most enormous evils on the country, and introduced 
a system of fraud, chicanery, and profligacy which destroyed 
all private confidence and all industry and enterprise " (2 
Story on the Constitution, 1371). 

To put an end to this vicious system of legislation which 
only encouraged fraud, thus graphically described by Story, 
the clauses which forbid the States from emitting bills of credit 
or making anything but gold and silver a tender in payment of 
debts, or passing any law impairing the obligation of contracts, 
were inserted in the Constitution. 

"The attention of the convention, therefore," says Chief 
Justice Marshall, "was particularly directed to paper money 
and to acts which enabled the debtor to discharge his debt 
otherwise than was stipulated in the contract. Had nothing 
more been intended, nothing more would have been expressed, 
but in the opinion of the convention much more remained to 
be done. The same mischief might be effected by other means. 
To restore public confidence completely, it was necessary, not 
only to prohibit the use of particular means by which it might 
be effected, but to prohibit the use of any means by which the 
same mischief might be produced. The convention appears 
to have intended to establish a great principle, that contracts 
should be inviolable " (Sturges vs. Crowninshield, 4 Wheat. , 
122, 206). 

It would be difficult to believe, even in the absence of the 
historical evidence we have on the subject, that the framers of 
the Constitution, profoundly impressed by the evils resulting 
from this kind of legislation, ever intended that the new Gov- 
ernment, ordained to establish justice, should possess the power 
of making its bills a legal tender, which they were unwilling 
should remain with the States, and which in the past had 


proved so dangerous to the peace of the community, so dis- 
turbing to the business of the people, and so destructive of 
their morality. 

The great historian of our country has recently given to the 
world a history of the convention, the result of years of labor 
in the examination of all public documents relating to its for- 
mation, and of the recorded opinions of its framers ; and thus 
he writes : 

"With the full recollection of the need or seeming need of 
paper money in the Revolution, with the menace of danger in 
future time of war from its prohibition, authority to issue bills 
of credit that should be legal tender was refused to the gen- 
eral Government by the vote of nine States against New Jersey 
and Maryland. It was Madison who decided the vote of Vir- 
ginia, and he has left his testimony that 'the pretext for a 
paper currency, and particularly for making the bills a tender, 
either for public or private debts, was cut off.' This is the in- 
terpretation of the clause made at the time of its adoption, alike 
by its authors and by its opponents, accepted by all the states- 
men of that age, not open to dispute because too clear for 
argument, and never disputed so long as any one man who took 
part in framing the Constitution remained alive. History can- 
not name a man who has gained enduring honor by causing 
the issue of paper money. Wherever such paper has been em- 
ployed it has in every case thrown upon its authors the burden 
of exculpation under the plea of pressing necessity" (Ban- 
croft's History of the Formation of the Constitution, vol. 2, 

And when the convention came to the prohibition upon the 
States, the historian says that the clause, "No State shall make 
anything but gold and silver a tender in payment of debts," 
was accepted without a dissentient State. " So the adoption of 
the Constitution," he adds, "is to be the end forever of paper 
money, whether issued by the several States or by the United 
States, if the Constitution shall be rightly interpreted and 
honestly obeyed" (id., 137). 

For nearly three-fourths of a century after the adoption of 


the Constitution, and until the legislation during the recent 
civil war, no jurist and no statesman of any position in the 
country ever pretended that a power to impart the quality of 
legal tender to its notes was vested in the general Government. 
There is no recorded word of even one in favor of its possessing 
the power. All conceded, as an axiom of constitutional law, 
that the power did not exist. 

Mr. Webster, from his firs!; entrance into public life in 1812, 
gave great consideration to the subject of the currency, and in 
an elaborate speech on that subject, made in the Senate in 
183G, then sitting in this room, he said : " Currency, in a largo 
and perhaps just sense, includes not only gold and silver and 
bank bills, but bills of exchange also. It may include all that 
adjusts exchanges and settles balances in the operations of 
trade and business ; but if we understand by currency the legal 
money of the country, and that which constitutes a legal tender 
for debts, and is the standard measure of value, then undoubt- 
edly nothing is included but gold and silver. Most unques- 
tionably there is no legal tender, and there can be no legal 
tender in this country, under the authority of this Government 
or any other, but gold and silver, either the coinage of our own 
mints or foreign coins at rates regulated by Congress. This is 
a constitutional principle, perfectly plain and of the highest 
importance. The States are expressly prohibited from making 
anything but gold and silver a legal tender in payment of debts, 
and although no such express prohibition is applied to Con- 
gress, yet, as Congress has no power granted to it in this respect 
but to coin money and to regulate the value of foreign coins, it 
clearly has no power to substitute paper or anything else for 
coin as a tender in payment of debts and in discharge of con- 
tracts. Congress has exercised this power fully in both its 
branches ; it lias coined money, and still coins it ; it has regu- 
lated the value of foreign coins, and still regulates their value. 
The legal tender, therefore, the constitutional standard of 
value, is established and cannot be overthrown. To overthrow 
it would shake the whole system " (4 Webster's Works, 271). 

When the idea of imparting the legal tender quality to the 


notes of the United States issued under the first act of 1862 
was first broached, the advocates of the measure rested their 
support of it on the ground that it was a war measure, to 
which the country was compelled to resort by the exigencies of 
its condition, being then sorely pressed by the Confederate 
forces, and requiring the daily expenditure of enormous sums 
to maintain its army and navy and to cariy on the Govern- 
ment. The Eepresentative who introduced the bill in the 
House declared that it was a measure of that nature, " one of 
necessity and not of choice ; " that the times were extraordi- 
nary and that extraordinary measures must be resorted to in 
order to save our Government and preserve our nationality 
(speech of Spaulding, of New York, Gong. Globe, 1861-62, Part 
1, 523). Other members of the House frankly confessed their 
doubt as to its constitutionality, but yielded their support of it 
under the pressure of this supposed necessity. 

In the Senate also the measure was pressed for the same 
reasons. When the act was reported by the Committee on 
Finance, its chairman, while opposing the legal tender provi- 
sion, said: "It is put on the ground of absolute, overwhelming 
necessity ; that the Government has now arrived at that point 
when it must have funds, and those funds are not to be ob- 
tained from ordinary sources, or from any of the expedients to 
which we have heretofore had recourse, and therefore, this new, 
anomalous, and remarkable provision must be resorted to in 
order to enable the Government to pay off the debt that it now 
owes and afford circulation which will be available for other 
purposes" (Cong. Globe, 1861-62, Part 1, 764). 

And upon that ground the provision was adopted, some of 
the Senators stating that in the exigency then existing money 
must be had, and they, therefore, sustained the measure, al- 
though they apprehended danger from the experiment. " Tho 
medicine of the Constitution," said Senator Sumner, "must 
not become its daily food " (id., 800). A similar necessity was 
urged upon the State tribunals and this court in justification 
of the measure, when its validity was questioned. The dissent- 
ing opinion in Hepburn vs. Griswold referred to the pressure 


that was upon the Government at the time to enable i* to raise 
and support an army and to provide and maintain a navy. 
Chief Justice Chase, who gave the prevailing opinion in that 
case, also spoke of the existence of the feeling when the bill 
was passed that the provision was necessary. He favored the 
provision on that ground when Secretary of the Treasury, al- 
though he had come to that conclusion with reluctance, and 
recommended its adoption by Congress. When the question as 
to its validity reached this court, this expression of favor was 
referred to, and by many it was supposed that it would control 
his judicial action. But after long pondering upon the sub- 
ject, after listening to repeated arguments by able counsel, he 
decided against the constitutionality of the provision ; and, 
holding in his hands the casting vote, he determined the judg- 
ment of the court. He preferred to preserve his integrity as a 
judicial officer rather than his consistency as a statesman. In 
his opinion he thus referred to his previous views : 

"It is not surprising that amid the tumult of the late civil 
war, and under the influence of apprehensions for the safety 
of the Republic almost universal, different views, never before 
entertained by American statesmen or jurists, were adopted 
by many. The time was not favorable to considerate reflec- 
tion upon the constitutional limits of legislative or executive 
authority. If power was assumed from patriotic motives, the 
assumption found ready justification in patriotic hearts. Many 
who doubted yielded their doubts ; many who did not doubt 
were silent. Some who were strongly averse to making gov- 
ernment notes a legal tender felt themselves constrained to 
acquiesce in the views of the advocates of the measure. Not a 
few who then insisted upon its necessity, or acquiesced in that 
view, have, since the return of peace, and under the influence 
of the calmer time, reconsidered their conclusions, and now 
concur in those which we have just announced. These conclu- 
sions seem to us to be fully sanctioned by the letter and spirit 
of the Constitution" (8 Wall., 625). 

It must be evident, however, upon reflection, that if there 
were any power in the Government of the United States to 


impart the quality of legal tender to its promissory notes, it 
was for Congress to determine when the necessity for its exer- 
cise existed ; that war merely increased the urgency for money ; 
it did not add to the powers of the Government nor change 
their nature ; that if the power existed it might be equally 
exercised when a loan was made to meet ordinary expenses in 
time of peace as when vast sums were needed to support an 
army or a navy in time of war. The wants of the Government 
could never be the measure of its powers. But in the excite- 
ment and apprehensions of the war these considerations were 
unheeded ; the measure was passed as one of overruling neces- 
sity in a perilous crisis of the country. Now, it is no longer 
advocated as one of necessity, but as one that may be adopted 
at any time. Never before was it contended by any jurist or 
commentator on the Constitution that the Government, in full 
receipt of ample income, with a treasury overflowing, with 
more money on hand than it knows what to do with, could 
issue paper money as a legal tender. What was, in 1862, called 
the "medicine of the Constitution," has now become its daily 
bread. So it always happens that whenever a wrong principle 
of conduct, political or personal, is adopted on a plea of neces- 
sity, it will be afterward followed on a plea of convenience. 

The advocates of the measure have not been consistent in 
the designation of the power upon which they have supported 
its validity, some placing it on the power to borrow money, 
some on the coining power, and some have claimed it as an 
incident to the general powers of the Government. In the 
present case it is placed by the court upon the power to bor- 
row money, and the alleged sovereignty of the United States 
over the currency. It is assumed that this power, when exer- 
cised by the Government, is something different from what it 
is when exercised by corporations or individuals, and that the 
Government has, by the legal tender provision, the power to 
enforce loans of money because the sovereign governments of 
European countries have claimed and exercised such power. 

" The words to borrow money," says the court, " are not to 
receive that limited and restricted interpretation and meaning 



which they would have in a penal statute or in an authority 
conferred by law or by contract upon trustees or agents for 
private purposes." And it adds that " the power, as incident 
to the power of borrowing money and issuing bills or notes of 
the Government for money bqrrowed, of impressing upon those 
bills or notes the quality of being a legal tender for the pay- 
ment of private debts, was a power universally understood to 
belong to sovereignty, in Europe and America, at the time of 
the framing and adoption of the Constitution of the United 
States. The governments of Europe, acting through the mon- 
arch or the legislature, according to the distribution of powers 
under their respective constitutions, had and have as sovereign 
a power of issuing paper money as of stamping coin," and that 
"the exercise of this power not being prohibited to Congress 
by the Constitution, it is included in the power expressly 
granted to borrow money on the credit of the United States." 

As to the terms to borrow money, where, I would ask, does 
the court find any authority for giving to them a different in- 
terpretation in the Constitution from what they receive when 
used in other instruments, as in the charters of municipal bod- 
ies or of private corporations, or in the contracts of individuals? 
They are not ambiguous ; they have a well-settled meaning in 
other instruments. If the court may change that in the Con- 
stitution, so it may the meaning of all other clauses, and the 
powers which the Government may exercise will be found de- 
clared, not by plain words in the organic law, but by words 
of a new significance resting in the minds of the judges. Until 
some authority beyond the alleged claim and practice of the 
sovereign governments of Europe be produced, I must believe 
that the terms have the same meaning in all instruments wher- 
ever they are used ; that they mean a power only to contract 
for a loan of money, upon considerations to be agreed between 
the parties. The conditions of the loan, or whether any particu- 
lar security shall be given to the lender, are matters of arrange- 
ment between the parties ; they do not concern any one else. 
They do not imply that the borrower can give to his promise to 
refund the money any security to the lender outside of property 


or rights which he possesses. The transaction is completed 
when the lender parts with his money and the borrower gives 
his promise to pay at the time, and in the manner, and with the 
securities agreed upon. "Whatever stipulations may be made 
to add to the value of the promise or to secure its fulfilment, 
must necessarily be limited to the property, rights, and priv- 
ileges which the borrower possesses. Whether he can add to 
his promises any element which will induce others to receive 
them beyond the security which he gives for their payment, 
depends upon his power to control such element. If he has a 
right to put a limitation upon the use of other persons' prop- 
erty, or to enforce an exaction of some benefit from them, he 
may give such privilege to the lender ; but if he has no right 
thus to interfere with the property or possessions of others, of 
course he can give none. It will hardly be pretended that the 
Government of the United States has any power to enter into 
an engagement that, as security for its notes, the lender shall 
have special privileges with respect to the visible property of 
others, shall be able to occupy a portion of their lands or their 
houses, and thus interfere with the possession and use of their 
property. If the Government cannot do that, how can it step 
in and say, as a condition of loaning money, that the lender 
shall have a right to interfere with contracts between private 
parties ? A large proportion of the property of the world ex- 
ists in contracts, and the Government has no more right to de- 
prive one of their value by legislation operating directly upon 
them, than it has a right to deprive one of the value of any 
visible and tangible property. No one, I think', will pretend 
that individuals or corporations possess the power to impart to 
their evidences of indebtedness any quality by which the holder 
will be able to affect the contracts of other parties, strangers to 
the loan ; nor would any one pretend that Congress possesses 
the power to impart any such quality to the notes of the 
United States, except from the clause authorizing it to make 
laws necessary and proper to the execution of its powei-s. That 
clause, however, does not enlarge the expressly designated 
powers ; it merely states what Congress could have done with- 


out its insertion in the Constitution. Without it Congress 
could have adopted any appropriate means to borrow ; but that 
can only be appropriate for that purpose which has some rela- 
tion of fitness to the end, which has respect to the terms essen- 
tial to the contract, or to the securities which the borrower 
may furnish for the repayment of the loan. The quality of 
legal tender does not touch the terms of the contract ; that is 
complete without it ; nor does it stand as a security for the loan, 
for a security is a thing pledged over which the borrower has 
some control, or in which he holds some interest. 

The argument presented by the advocates of legal tender is, 
in substance, this : The object of borrowing is to raise funds ; 
the addition of the quality of legal tender to the notes of the 
Government will induce parties to take them, and funds will 
thereby be more readily loaned. But the same thing may be 
said of the addition of any other quality which would give to 
the holder of the notes some advantage over the property of 
others, as, for instance, that the notes should serve as a pass on 
the public conveyances of the country, or as a ticket to places 
of amusement, or should exempt his property from State and 
municipal taxation, or entitle him to the free use of the tele- 
graph lines, or to a percentage from the rev?nues of private 
corporations. The same consequence, a ready acceptance of 
the notes, would follow ; and yet no one would pretend that the 
addition of privileges of this kind with respect to the property 
of others, over which the borrower has no control, would be in 
any sense an appropriate measure to the execution of the power 
to borrow. 

Undoubtedly the power to borrow includes the power to give 
evidences of the loan in bonds, treasury notes, or in such other 
form as may be agreed between the parties. These may be issued 
in such amounts as will fit them for circulation, and for that 
purpose may be made payable to bearer, and transferable by 
delivery. Experience has shown that the form best fitted to 
secure their ready acceptance is that of notes payable to bearer 
in such amounts as may suit the ability of the lender. The 
Government, in substance, says to parties with whom it deals : 


Lend us your money, or furnish us with your products or your 
labor, and we will ultimately pay you, and as evidence of it we 
will give you our notes, in such form and amount as may suit 
your convenience, and enable you to transfer them; we will 
also receive them for certain demands due to us. In all this 
matter there is only a dealing between the Government and the 
individuals who trust it. The transaction concerns no others. 
The power which authorizes it is a very different one from a 
power to deal between parties to private contracts in which the 
Government is not interested, and to compel the receipt of these 
promises to pay in place of the money for which the contracts 
stiptilated. This latter power is not an incident to the former ; 
it is a distinct and far greater power. There is no legal con- 
nection between the two ; between the power to borrow from 
those willing to lend and the power to interfere with the inde- 
pendent contracts of others. The possession of this latter 
power would justify the interference of the Government with 
any rights of property of other parties, under the pretence 
that its allowance to the holders of the notes would lead to 
their more ready acceptance, and thus furnish the needed 

The power vested in Congress to coin money does not in my 
judgment fortify the position of the court as its opinion affirms. 
So far from deducing from that power any authority to impress 
the notes of the Government with the quality of legal tender, 
its existence seems to me inconsistent with a power to make 
anything but coin a legal tender. The meaning of the terms 
" to coin money " is not at all doubtful. It is to mould metallic 
substances into forms convenient for circulation and to stamp 
them with the impress of the Government authority indicating 
their value with reference to the unit of value established by 
law. Coins are pieces of metal of definite weight and value, 
stamped such by the authority of the Government. If any 
doubt could exist that the power has reference to metallic sub- 
stances only it would be removed by the language which im- 
mediately follows, authorizing Congress to regulate the value 
of money thus coined and of foreign coin, and also by clauses 


making a distinction between coin and the obligations of the 
general Government and of the States. Thus, in the clause 
authorizing Congress "to provide for the punishment of coun- 
terfeiting the securities and current coin of the United States," 
a distinction is made between the obligations and the coin of 
tha Government. 

Money is not only a medium of exchange, but it is a standard 
of value. Nothing can be such standard which has not intrin- 
sic value, or which is subject to frequent changes in value. 
From the earliest period in the history of civilized nations, we 
find pieces of gold and silver used as money. These metals are 
scattered over the world in small quantities ; they are suscepti- 
ble of division, capable of easy impression, have more value in 
proportion to weight and size, and are less subject to loss by 
wear and abrasion than any other material possessing these 
qualities. It requires labor to obtain them ; they are not de- 
pendent upon legislation or the caprices of the multitude ; they 
cannot be manufactured or decreed into existence, and they do 
not peiish by lapse of time. They have, therefore, naturally, 
if not necessarily, become throughout the world a standard of 
value. In exchange for pieces of them, products requiring an 
equal amount of labor are readily given. When the product 
and the piece of metal represent the same labor, or an approxi- 
mation to it, they are freely exchanged. There can be no ade- 
quate substitute for these metals. Says Mr. Webster, in a 
speech made in the House of Representatives in 1815 : 

" The circulating medium of a commercial community must 
be that which is also the circulating medium of other commer- 
cial communities, or must be capable of being converted into 
that medium without loss. It must also be able, not only to 
pass in payments and receipts among individuals of the same 
society and nation, but to adjust and discharge the balance of 
exchanges between different nations. It must be something 
which has a value abroad as well as at home, by which foreign 
as well as domestic debts can be satisfied. The precious 
metals alone answer these purposes. They alone, therefore, 
are money, and whatever else is to perform the functions of 


money must be their representative, and capable of being 
turned into them at will. So long as bank paper retains this 
quality it is a substitute for money ; divested of this, nothing 
can give it that character " (3 Webster's Works, 41). 

The clause to coin money must be read in connection with 
the prohibition upon the States to make anything but gold 
and silver coin a tender in payment of debts. The two taken 
together clearly show that the coins to be fabricated under the 
authority of the general Government, and as such to be a legal 
tender for debts, are to be composed principally, if not entirely, 
of the metals of gold and silver. Coins of such metals are 
necessarily a legal tender to the amount of their respective 
values without any legislative enactment, and the statute of 
the United States providing that they shall be such tender 
is only declaratory of their effect when offered in payment. 
WTien the Constitution says, therefore, that Congress shall have 
the power to coin money, interpreting that clause with the pro- 
hibition upon the States, it says it shall have the power to 
make coins of the precious metals a legal tender, for that alone 
which is money can be a legal tender. If this be the true im- 
port of the language, nothing else can be made a legal tender. 
We all know that the value of the notes of the Government in 
the market, and in the commercial world generally, depends 
upon their convertibility on demand into coin ; and as confi- 
dence in such convertibility increases or diminishes, so does 
the exchangeable value of the notes vary. So far from becom- 
ing themselves standards of value by reason of the legislative 
declaration to that effect, their own value is measured by the 
facility with which they can be exchanged into that which 
alone is regarded as money by the commercial world. They 
are promises of money, but they are not money in the sense of 
the Constitution. The term money is used in that instrument 
in several clauses; in the one authorizing Congress " to borrow 
money;" in the one authorizing Congress "to coin money;" 
in the one declaring that " no money " shall be drawn from the 
treasury but in consequence of appropriations made by law ; 
and in the one declaring that no State shall " coin money." 


And it is a settled rule of interpretation that the same term 
occurring in different parts of the same instrument shall bo 
taken in the same sense, unless there be something in the con- 
text indicating that a different meaning was intended. Now, 
to coin money is, as I have said, to make coins out of metallic 
substances, and the only money the value of which Congress 
can regulate is coined money, either of our mints or of foreign 
countries. It should seem, therefore, that to borrow money is to 
obtain a loan of coined money, that is, money composed of the 
precious metals, representing value in the purchase of property 
and payment of debts. Between the promises of the Govern- 
ment, designated as its securities, and this money, the Constitu- 
tion draws a distinction, which disappears in the opinion of the 

The opinion not only declares that it is in the power of Con- 
gress to make the notes of the Government a legal tender and 
a standard of value, but that under the power to coin money 
and regulate the value thereof. Congress may issue coins of the 
same denominations as those now already current, but of less 
intrinsic value, by reason of containing a less weight of the 
precious metals, and thereby enable debtors to discharge their 
debts by payment of coins of less real value. This doctrine is 
put forth as in some way a justification of the legislation 
authorizing the tender of nominal money in, place of real money 
in payment of debts. Undoubtedly Congress has power to 
alter the value of coins issued, either by increasing or diminish- 
ing the alloy they contain ; so it may alter, at its pleasure, their 
denominations ; it may hereafter call a dollar an eagle, and it 
may call an eagle a dollar. But if it be intended to assert that 
Congress can make the coins changed the equivalent of those 
having a greater value in their previous condition, and compel 
parties contracting for the latter to receive coins with diminished 
value, I must be permitted to deny any such authority. Any 
such declaration on its part would be not only utterly inopera- 
tive in fact, but a shameful disregard of its constitutional duty. 
As I said on a former occasion : " The power to coin money, 
as declared by this court, is a great trust devolved upon Con- 


gress, carrying with it the duty of creating and maintaining a 
uniform standard of value throughout the Union, and it would 
be a manifest abuse of this trust to give to the coins issued 
by its authority any other than their real value. By debasing 
the coins, when once the standard is fixed, is meant giving to 
the coins, by their form and impress, a certificate of their having 
a relation to that standard different from that which, in truth, 
they possess ; in other words, giving to the coins a false certifi- 
cate of their value. Arbitrary and profligate governments 
have often resorted to this miserable scheme of robbery, which 
Mill designates as a shallow and impudent artifice, the ' least 
covert of all modes of knavery, which consists in calling a 
shilling a pound, that a debt of one hundred pounds may be 
cancelled by the payment of one hundred shillings.' " No such 
debasement has ever been attempted in this country, and none 
ever will be so long as any sentiment of honor influences the 
governing power of the nation. The changes from time to time 
in the quantity of alloy in the different coins have been made 
to preserve the proper relative value between gold and silver, or 
to prevent exportation, and not with a view of debasing them. 
Whatever power may be vested in the Government of the United 
States, it has none to perpetrate such monstrous iniquity. One 
of the great purposes of its creation, as expressed in the preamble 
of the Constitution, was the establishment of justice, and not a 
line nor a word is found in that instrument which sanctions any 
intentional wrong to the citizen, either in war or in peace. 

But beyond and above all the objections which I have stated 
to the decision recognizing a power in Congress to impart the 
legal-tender quality to the notes of the Government, is my 
objection to the rule of construction adopted by the court to 
reach its conclusions, , rule which, fully carried out, would 
change the whole nature of our Constitution and break down 
the barriers which separate a government of limited from one 
of unlimited powers. When the Constitution came before the 
conventions of the several States for adoption, apprehension 
existed that other powers than those designated might be 
claimed ; and it led to the first ten amendments. When these 



were presented to the States they were preceded by a preamble 
stating that the conventions of a number of the States had, at 
the time of adopting the Constitution, expressed a desire, " in 
order to prevent misconception or abuse of its powers, that 
further declaratory and restrictive clauses should be added." 
One of them is found in the tenth amendment, which declares 
that " the powers not delegated to the United States by the 
Constitution, nor prohibited by it to the States, are reserved to 
the States respectively, or to the people." The framers of the 
Constitution, as I have said, were profoundly impressed with 
the evils which had resulted from the vicious legislation of the 
States making notes a legal tender, and they determined that 
such a power should not exist any longer. They therefore 
prohibited the States from exercising it, and they refused to 
grant it to the new government which they created. Of what 
purpose is it, then, to refer to the exercise of the power by the 
absolute or the limited governments of Europe, or by the States 
previous to our Constittition ? Congress can exercise no power 
by virtue of any supposed inherent sovereignty in the general 
Government. Indeed, it may be doubted whether the power 
can be correctly said to appertain to sovereignty in any proper 
sense as an attribute of an independent political community. 
The power to commit violence, perpetrate injustice, take pri- 
vate property by force without compensation to the owner, and 
compel the receipt of promises to pay in place of money, may 
be exercised, as it often has been, by irresponsible authority, 
but it cannot be considered as belonging to a government 
founded upon law. But be that as it may, there is no such 
tiling as a power of inherent sovereignty in the Government of 
the United States. It is a government of delegated powers, 
supreme within its prescribed sphere, but powerless outside of 
it. In this country sovereignty resides in the people, and Con- 
gress can exercise no power which they have not, by their 
Constitution, entrusted to it ; all else is withheld. It seems, 
however, to be supposed that, as the power was taken from 
the States, it could not have been intended that it should dis- 
appear entirely, and therefore it must in some way adhere to 


the general Government, notwithstanding the tenth amend- 
ment and the nature of the Constitution. The doctrine, that 
a power not expressly forbidden may be exercised, would, as I 
have observed, change the character of our Government. If I 
have read the Constitution aright, if there is any weight to be 
given to the uniform teachings of our great jurists and of com- 
mentators previous to the late civil war, the true doctrine is 
the very opposite of this. If the power is not in terms granted, 
and is not necessary and proper for the exercise of a power 
which is thus granted, it does not exist. And in determining 
what measures may be adopted in executing the powers granted, 
Chief-Justice Marshall declares that they must be appropriate, 
plainly adapted to the end, not prohibited, and consistent u-ith 
the letter and spirit of the Constitution. Now, all through that 
instrument we find limitations upon the power, both of the gen- 
eral Government and the State Governments, so as to prevent 
oppression and injustice. No legislation, therefore, tending to 
promote either can consist with the letter and spirit of the Consti- 
tution. A law which interferes with the contracts of others and 
compels one of the parties to receive in satisfaction something 
different from that stipulated, without reference to its actual 
value in the market, necessarily works such injustice and wrong. 
There is, it is true, no provision in the Constitution of the 
United States forbidding in direct terms the passing of laws 
by Congress impairing the obligation of contracts, and there 
are many express powers conferred, such as the power to de- 
clare war, levy duties, and regulate commerce, the exercise 
of which affects more or less the value of contracts. Thus war 
necessarily suspends intercourse between citizens or subjects 
of belligerent nations, .and the performance during its con- 
tinuance of previous contracts. The imposition of duties upon 
goods may affect the prices of articles imported or manufac- 
tured, so as to materially alter the value of previous contracts 
respecting them. But these incidental consequences arising 
from the exercise of such powers were contemplated in tho 
grant of them. As there can be no solid objection to legis- 
lation under them, no just complaint can be made of such con- 


sequences. But far different is the case when the impairment 
of the contract does not follow incidentally, but is directly and 
in terms allowed and enacted. Legislation operating directly 
upon private contracts, changing their conditions, is forbidden 
to the States ; and no power to alter the stipulations of such 
contracts by direct legislation is conferred upon Congress. 
There are also many considerations, outside of the fact that 
there is no grant of the power, which show that the framers of 
the Constitution never intended that such power should be 
exercised. One of the great objects of the Constitution, as al- 
ready observed, was to establish justice, and what was meant 
by that in its relations to contracts, as said by the late Chief 
Justice in his opinion in Hepburn vs. Griswold, w r as not left to 
inference or conjecture. And in support of this statement he 
refers to the fact that when the Constitution was undergoing 
discussion in the convention, the Congress of the Confedera- 
tion was engaged in framing the ordinance for the government 
of the Northwest Territory, in which certain articles of com- 
pact were established between the people of the original States 
and the people of the Territory for the purpose, as expressed 
in the instrument, " of extending the fundamental principles 
of civil and religious liberty, whereon these republics [the 
States united under the confederation], their laws and constitu- 
tions are erected." That Congress was also alive to the evils 
which the loose legislation of the States had created by inter- 
fering with the obligation of private contracts and making notes 
a legal tender for debts ; and the ordinance declared that in 
the just preservation of rights and property no law "ought 
ever to be made, or have force in the said Territory, that shall 
in any manner whatever interfere with or affect private con- 
tracts, or engagements, bona fide and without fraud, previously 
formed." This principle, said the Chief Justice, found more 
condensed expression in the prohibition upon the States against 
impairing the obligation of contracts, which has always been 
recognized " as an efficient safeguard against injustice ; " and 
the court was then of opinion that "it is clear that those who 
framed and those who adopted the Constitution intended that 


the spirit of this prohibition should pervade the entire body of 
legislation, and that the justice which the Constitution was 
ordained to establish was not thought by them to be com- 
patible with legislation of an opposite tendency." Soon after 
the Constitution was adopted the case of Calder vs. Bull came 
before this court, and it was there said that there were acts 
which the Federal and State legislatures could not do without 
exceeding their aiithority ; and among them was mentioned a 
law which punished a citizen for an innocent act, and a law 
which destroyed or impaired the lawful private contracts of 
citizens. "It is against all reason and justice," it was added, 
' ' for a people to entrust a legislature with such powers, and, 
therefore, it cannot be presumed that they have done it " (3 
Dallas, 388). And Mr. Madison, in one of the articles in the 
Federalist, declared that laws impairing the obligation of con- 
tracts were contrary to the first principles of the social com- 
pact, and to every principle of sound legislation. Yet this 
court holds that a measure directly operating upon and neces- 
sarily impairing private contracts, may be adopted in the execu- 
tion of powers specifically granted for other purposes, because 
it is not in terms prohibited, and that it is consistent with the 
letter and spirit of the Constitution. 

From the decision of the court I see only evil likely to fol- 
low. There have been times within the memory of all of us 
when the legal-tender notes of the United States were not 
exchangeable for more than one-half of their nominal value. 
The possibility of such depreciation will always attend paper 
money. This inborn infirmity no mere legislative declaration 
can cure. If Congress has the power to make the notes a legal 
tender and to pass as money or its equivalent, why should not 
a sufficient amount be issued to pay the bonds of the United 
States as they mature ? Why pay interest on the millions of 
dollars of bonds now due, when Congress can in one day make 
the money to pay the principal ? And why should there be 
any restraint upon unlimited appropriations by the Government 
for all imaginary schemes of public improvement, if the print- 
ing-press can furnish the money that is needed for them ? 


Accumulation of notes in Treasury, 

Action of Parliament in 1720, 3 ; of 
Parliament in 1740, 3 ; of Parlia- 
ment in 1751, 3 ; of Colonies, 3 ; 
of Continental Congress, 9 ; of 
Federal Convention, 13. 

Action, Congressional. See Acts. 

Action of States in regard to sur- 
plus, 181. 

Acts of Parliament prohibiting 
paper money in Colonies, of 1720, 
3; of 1740, 3; of 1751, 3; for 
issue of Treasury notes, of June 
30, 1812, 29; of February 25, 
1813, 29; of March 14, 1814, 30; 
of December 26, 1814, 30 ; of Feb- 
ruary 24, 1815, 33; of October 1. 
1837, 42; of May 1, 1838, 45; of 
March 2, 1839, 45 ; of March, 31, 
1840, 46; of February 15, 1841, 
49 ; of January 31, 1842, 51 ; of 
August 31. 1842, 51 ; of March 3, 
1848, 51 ; of July 22, 1846, 64 ; of | 
January 28, 1847, 69 ; of Decem- 
ber 23, 1857, 70 ; of December 17, ! 

1860, 75. 

Acts authorizing Treasury notes, of ! 

March 2, 1861, 79. 
Acts authorizing 7-30 notes, of July 

17, 1861, 88; of August 5, 1861, 

88 ; of June 30, 1864, 97 ; of March . 

3, 1865, 97. 
Acts authorizing demand notes, of 

July 17, 1861, 88; of August 5, 

1861, 88. 

Acts, miscellaneous, of June 22, 
1860, 72 ; of February 8, 1861, 79 ; \ 
postal note, 100 ; prohibiting shin- j 
plasters, 103; for retiring 7-30 

notes, 113; authorizing four per 
cent, certificates, 117; authorizing 
additional issue bank circulation, 
1 14 ; authorizing issue of legal ten- 
ders, 136, 138 ; authorizing issue of 
gold certificates, 115; authorizing 
issue of legal-tender note cer- 
tificates, 116; authorizing cancel- 
lation of legal tenders, 140 ; repeal- 
ing right to fund legal-tender 
notes, 138 ; for resumption of 
specie payments, 141 ; removing 
restrictions as to limit of issue of 
National bank notes, 140 ; coinage 
of 1792, 148; of 1873, 149; au- 
thorizing silver dollars, 152 ; au- 
thorizing silver certificates, 152; 
regulating deposits with State 
banks, 172; authorizing deposit of 
surplus money with the States, 172. 

Adams, John Quincy, opposes post- 
ponement bill, 187. 

Additional issue of notes, 30. 

Administration, Harrison's, 49 ; 
Van Buren's, 50 ; Tyler's, 53 ; 
Buchanan's, 71; Lincoln's, 117; 
Jackson's, represented by Benton 
in Senate, 176 ; Hayes', 150. 

Advances made by banks to Govern- 
ment, 96. 

Advantages to banks in placing 7-30 
notes, 94. 

Allegations of favoritism to banks, 
29, 175. 

Alley, John B. Remarks on legal- 
tender bill, 125. 

Amendment to Constitution to per- 
mit distribution of surplus, sug- 
gested by Jackson, 169. 

Amount of Treasury notes author- 



ized in 1812, 25 ; of bank currency, 
31 ; of Treasury notes outstand- 
ing in 1814. 31 ; of notes author- 
ized, 42 ; largest outstanding at 
any one time, 45 ; amount out- 
standing at advent of Harrison's 
administration, 50; issued nnder 
Act of February, 1841, 49; of notes 
issued from 1837 to 1841, 49; 
notes falling due during year 1843. 
51 ; of loan of 1846, t>4 ; issues and 
reissues under Act of 1847, 09; 
Treasury notes outstanding in 1860, 
71 ; in 1884, 71 ; of Treasury notes 
issued under the Act of March 2, 
1861, 79; of 7-30 notes taken by 
New York bankers, 93; of fraction- 
al currency issued, 104 ; of surplus 
due from States carried as una- 
vailable on Treasury books, 188 ; 
authorized under various Acts, 53. 

Anticipation of revenues by use of 
Treasury notes, 49. 

Antipathy to paper money, 10. 

Anxiety to obtain fractional cur- 
rency, 104. 

Apportionment of deposit banks 
among States, 182. 

Apportionment of surplus revenue 
among States, recommended by 
Jackson, 169; opposed by Jackson, 
171 ; basis of, 180. 

Appropriation of public money for 
improvements thought unconsti- 
tutional, 169; required to take 
surplus from Treasury, 189. 

Approval of bills. See Acts. 

Arguments for and against Treasury 
notes in 1812, 22; in 1813, 29; in 
1814-15, 31 ; in 18:)7, 41 ; in 1838, 
43; in 1840, 46; in 1842, 51; of 
Committee of Ways and Means in 
1844, against Treasury notes, 54 ; 
in Federal Convention, 14; in 1862, 
125; in legal-tender cases, 156- 
166 ; relative to distribution of sur- 
plus, for and against, in 1829, 171 ; 
in 1835, 172 ; of Jackson's oppo- 
nents, 175; of Benton, against, 177; 
for and against postponement of 
fourth instalment, 183-188. 

Arrangements with New York banks 
for placing 7-30 loan, 93. 

Attorney General Bates' opinion as 
to legal tender, 121. 

Authority to issue bills, States de 
prived of, 10. 

Authority to coin money, States de- 
prived of, 10. 

Available balance in Treasury at 
various dates, 171. 

BANKS, land, proposed by John 
Coleman, 1 ; defeat of land, 2 ; 
paper money, under auspices of 
Treasury, 2 ; loan of merchants of 
Boston, 2 ; second land, proposal 
by Coleman, 2 ; plan of, 3 ; oppose J 
by Governor Belcher, 3 ; Hutchi- 
son's specie, 3 ; charter of, l/y 
States, 11 ; power of Congress to 
create, to circulate bills, 11 ; Na- 
tional recommended, 31 ; Secord, 
of United States, 41 ; National, 
Hamilton's report on, 19 ; propo- 
sition to tax circulation on, 51. 

Banks of New York City strengthen 
hands of Government, 143. 

Banks, right to issne paper money 
when chartered by States, 11 ; to 
circulate bills when chartered by 
Congress, 1 1 ; bad condition of 
currency . of, in 1 81 5, 31 ; great 
increase in number of, 31 ; alleged 
favoritism shown to, 29 ; resump- 
tion of specie payments by, 43 ; 
negotiations and agreements with, 
95 ; advances agreed to be made 
by, 1:6 ; National, bill for, 120 ; of 
deposit in 1837. 182 ; forms of let- 
ters sent to, directing transfer of 
deposits, 182 ; losses from failure to 
pay specie, 1 83 ; specie payments 
suspended by, in 1814. 31 ; in 1837, 
40 ; in 1857, 10 ; amounts due Gov- 
ernment from insolvent, 43 ; re- 
sumption of specie payments by, in 
1837, 43 ; use of, as depositories of 
Government money, 40, 172; favor- 
ites of the administration, 172. 

Bank circulation, Benton's propo- 
sition to tax, 51 . 

Bank vs. Supervisors, legal-tender 
case, 156. 

Bank of Commerce vs. New York 
City, 156. 

Banking Act, free, of New York 
State, 43. 

Banking Act, National, 120. 

Bates, Attorney-General, opinion 



as to constitutionality of legal- 
tender bill, 121. 

Bayard, Thomas F., Delaware, re- 
marks on legal-tender bill, 133. 

Belcher, Governor, Massachusetts, 
intrigues of paper money advocates I 
against, 4 ; proclamation of, 5 ; 
differences with Legislature, 6 ; ! 
forced to retire, 4 ; subsequently 
Governor of New Jersey, 4 ; let- 
ter to Hutchison, 6. 

Bell, John, Tennessee, opposes bill 
for postponement of fourth instal- 
ment of surplus, 187. 

Benton, Thos. H., Missouri, moves to ' 
increase denominations of Treas- 
ury notes, 41 ; in favor of Treas- I 
ury notes, 41 ; in favor of Treasury j 
note bill of 1838, 45 ; proposes to ! 
tax bank circulation, 51 ; objects 
generally to issue of Treasury 
notes, 41 : " Thirty years' view " 
upon Jackson's course toward ' 
Bank of United States, 174; made 
member of committee to inquire 
into Federal expenditure, 175; 
defends Jackson's administration, 
176 ; opposes bill for distribution 
of surplus, 177; his description 
of Jackson's repugnance to sign 
bill for distribution of surplus. 
178 ; remarks on use of deposits 
made by States, 190. 

Bibb, Gdo. M., Secretary of Treas-; 
ury, 52 ; member of committee to ; 
inquire inio- extent of Executive 
patronage, 175. 

Bids, for Treasury notes, 76 ; for 
bonds, 80. 

Bills, for Treasury notes 1812, 15 ; 
arguments for and against, 23 ; 
for Treasury notes 1813, 29 ; for 
Treasury notes 1837, 41 ; for uew 
issue of" Treasury notes 1838, 43 ; 
for Treasury notes 1840, 46 ; 
long debate on bill of 1840, 46 ; 
loan introduced by Millard Fill- 
more, 50 ; objections to Fillmore's 
loan bill, 50; Fillmore's loan, 
bitter debate on, 50 ; for issue and 
reissue of Treasury notes intro- 
duced 1842, 51 ; Treasury notes of 
1843, 51 ; Treasury notes of 1840, 
63 ; Treasury notes of 1847, 64 ; ' 
Treasury notes of 1857, 70 ; 
National Bank, 120; legal-tender, 

121 ; exchequer of President Ty- 
ler, 53 ; for loan and issue of 
Treasury notes, 63 ; legal tender 
(see Legal tenders) for recharter 
of Bank of United States, 174; 
for distribution of surplus rev- 
enue, 167, 177 ; for postponement 
of payment of fourth instalment 
of surplus, 184. 

Bills of credit, in Federal Conven- 
tion, 13 ; authority of States to 
issue, 13; power of Congress to 
emit, 13 ; discussion of right to 
make legal tender, 14 ; Hamilton's 
opinion as to, 19; revolutionary, 
bore interest, 44 ; definition of, by 
Chief Justice Marshall, 44 ; argu- 
ment of committee of House in 
1844 as to right to issue, 54-61. 

Blaine, James G., Maine, discusses 
policy of legal tender issues in 
''Twenty Years in Congress," 

Blake, Harrison G., Ohio, remarks 
on legal-tender bill, 125. 

Board of Supervisors of New York 
City claim greenbacks are not 
obligations of the United States, 
156, 157. 

Bollan, Thos., agent of Province of 
Massachusetts in England. 7. 

Bonds. U. S., discount during period 
1812-1815, 39; discount during 
1860, 1861, 79. 

Bradley, Mr. Justice, of Supreme 
Court, separate concurring opin- 
ion in legal-tender case, 162. 

Brown. Bedford, Senator from 
North Carolina, in favor of Treas- 
ury note bill, 45. 

Bubble Act enacted by Parliament 
in 1720, 7. 

Buchanan, Jas., President, Treasury 
notes of administration of, 70; 
amendment to bill for postpone- 
ment of fourth instalment of sur- 
plus, 186. 

CABINET. Jackson's, dissent from 
his views, 174 ; paper read to, 174 ; 
changes in, 1 75. 

Calhoun, Jno. C., of South Carolina, 
in favor of Treasury note bill of 
1838, 45 ; makes motion in Senate 
for select committee, 175. 

Cambreling, Churchill C., of New 



York, introduces Treasury note 
bill, 43 ; argument of, in favor of 
bill, 48. 

Capital, of Confederate States at 
Montgomery, Ala., 8-J ; Washing- 
ton. D. C.. in danger, 83 

Capital of depository banks in 1S33, 

Cases, legal-tender. Bank vs. Su- 
pervisors, 157; Hepburn w. Gris- 
wold, 158 ; Parker vs. Davis, 102 ; , 
Juilliard vx. Gree:iman, 1(55. 

Certificates, tour per cent., denomi- 
nations of, .117; convertible into 
four per cent, bonds, 117; unneces- 
sary, 117; eagerness of the people 
to obtain, 117. 

Certificates, gold, issued under act 
of March 3, 1863, 115 ; used for 
Clearing-house purposes, 114; de- 
nominations of, 115 ; coin and 
bullion deposited for, 115; issued in 
payment of interest on public debt. 
115; terms of issue, 115; amount 
outstanding, 116 ; of act of July 
12, 1882, 155 ; amount issued under 
act of July 12, 1882, 155. 

Certificates, legal-tender, bear no in- 
terest, 116; used for Clearing-house 
purposes, 116; payable in U. S. 
notes at place of issue, 116; held 
in reserve by national banks, 116 ; 
amount reduced after resumption 
of specie payments, 116 ; amount 
outstanding, 118. 

Certificates, loan, to be made a legal 
tender, 43. 

Certificates, silver, authorized by act 
of February 28, 1878, 152 ; denom- 
inations of, 152; coin deposited for, 
to remain in Treasury, 152 ; to be 
receivable for customs, taxes, and 
dues, 152; may be reissued, 152; 
amount outstanding, 153 ; act of 
July 12, 1882, makes available for 
reserve of national banks, and re- 
servable for Clearing-house bal- 
ances, 155 ; not a legal tender, 155. 

Certificates, three per cent. , author- 
ized, 113; excess of bank reserve 
invested in, 114 ; advantage for 
Clearing-house purposes, 114 ; 
amount of first issue, 114; addi- 
tional amount, 114 ; to be cancell- 
ed, 114 ; terms of redemption, 115. 

Chase, Salmon P., Ohio, Secretary 

of Treasury, 8G ; estimates in 1861, 
86 ; recommends loan of one hun- 
dren millions in Treasury notes 
bearing 7-, |T per cent, interest, 8(5 ; 
signs circular to receive demanl 
notes for salary, 89 ; consults with 
the banks, <J4, 95 ; letter of, to the 
Ways and Means Committee, 122 ; 
proposes two plans for strength- 
ening finances, 120; recommend- 
ing further issue of legal-tender 
notes, 137; gives notice of with- 
drawal of right to fund legal-ten- 
ders into 5-20's, 138; Chief-Jus- 
tice, 158; delivers opinion in first 
legal-tender case, 158 ; dissenting 
opinion in second legal-tender case, 
164 ; justifies legal-tender policy, 
145 ; opinion as to power of States 
to create banks to issue bills, 12. 

Cheves, Langdon, South Caiolina, 
reports first bill for issue of 
Treasury notes, 22. 

Circular, of Secretary Chase and 
other officials agreeing to receive 
demand notes in payment of sal- 
aries, 89 ; announcing redemption 
of small notes in coin, 93 ; of Gen- 
eral Scott to army, 89 ; notifying 
deposit banks of drafts to pay in- 
stalments of surplus, 182. 

Circulating medium, condition in 
1814, 33 ; inquiry as to, 53 ; unfit- 
ness of Treasury notes for use as, 

Cities omitted from law forbidding 
issue of fractional notes. 

Civil war, inauguration of, 83. 

Claims of States for payment of 
fourth instalment, 191. 

Clay. Henry, Kentucky, opposes 
issue of Treasury notes, 42, 45 ; 
attacks Jackson, 174; defeated in 
Presidential campaign of 183:?, 
174 ; supports bill for distribution 
of revenues, 177. 

Clearing-house, Assistant Treasurer 
of U. S. at New York member of, 

Clifford, Mr. Justice, concurs with 
Chief Justice in first legal-tender 
decision, 158 ; concurs with Chief 
Justice in dissenting opinion in 
second legal-tender decision, 164. 

Cobb, Howell. Georgia, Secretary 
of Treasury, 70 ; estimates of, for 



1857, 70; recommends Treasury 
notes, 70 ; proposals invited by, 
for loan, 73; recommends that 
Government lands be pledged for 
payment of Treasury notes, 75; 
resigns, 75. 

Coin, gold and silver, only legal 
tender, 18 ; subsidiary silver, 109 ; 
gold, Secretary may sell bonds for, 
for resumption purposes, 141. 

Coinage of silver dollars, 150 ; Acts 
regulating, 148, 149. 

Coinage acts, of 1792, 148 ; of 1834, 
148; of 1853, 149; of 1873, 149; 
of 1878, 149. 

Collamer, Jacob, Vermont, moves to 
strike out legal-tender clause, 135; 
votes against legal-tender bill, 

Coleman, John, advocates land bank, 
1 ; incorporates a second land 
bank, 2 ; his scheme opposed by 
Governor Belcher, 3. 

Colonies, paper money in, 1 ; Par- 
liament forbids issue of paper 
money by, 3. 

Colonists embittered against Eng- 
land, 3. 

Commissioners of Loans to coun- 
tersign Treasury notes, 25. 

Commissioners of Sinking Fund au- 
thorized to pay notes, 26. 

Committee of Ways and Means, 
Mr. Cheves chairman of, 22 ; Mr. 
Eppes chairman of, 32 ; Mr. Cam- 
breling chairman of, 43 ; Mr. Jones 
chairman of, 46 ; Millard Fillmore 
chairman of, 50 ; instructed to in- 
quire into issue of Treasury notes, 
53 ; reports of, 32, 54 ; Gallatin's 
letter to, 22 ; Dallas' report to, 
31 ; Spencer's btter to, 53 ; Dix's 
letter to, 77, 89 ; letter of Chase 
to, 122. 

Committee, Finance, of Senate, letter 
of Secretary Chase to, 137. 

Committee, select, to inquire into 
extent of Executive patronage, 
175 ; report of, 176. 

Compound interest notes issued in 
place of 7-30 notes, 110; form 
of, 111 ; amount of, 85 ; amount 
outstanding, 118; Secretary on, 
110 ; Acts to retire, 113, 114; were 
legal tender, 109. 

Condition of postal currency bad, 104. 

Congress, power to coin money 10; 
authority to create banks, 11; 
to authorize bills of credit (see 
Legal tender) ; Acts of (see Acts); 
reduction of revenues by, in 1845, 
63; extra session of 1837, 183; 
in 1861, 84; considers Spencer's 
issue of Treasury notes an evasion 
of law, 54. 

Conkling, Roscoe, New York, objects 
to making U. S. notes a legal ten- 
der, 1 29 ; remarks on legal-tender 
bill, 129. 

Constitution, Federal, debate on, 10; 
adopted, 19 ; original draft of, 13. 

Constitutional right of Senate to 
originate money bill, 41. 

Constitutionality of issue of Treas- 
ury notes discussed, in 1812, 22 ; 
in 1813, 29; in 1837, 41 ; in 1838, 
45 ; by Committee of Ways and 
Means, in 1844, 53; in 1861 and 
1862, 124-136 (also see Cases, 

Continental Congress, no legal-ten- 
der notes issued by, 117 ; recom- 
mends Legislatures of States to 
pass tender laws, 119 ; authorized 
issue of paper money, 9; fixed 
total issue, 9 ; authorized a new 
issue to redeem old, 90. 

Continental money, first issue of, 
9; depreciation of, 9; required to 
be bought in for coin at market 
value, 9; new issue of, 9; total 
amount of, 10 ; loss on, lO ; an- 
tipathy to, 10; convention (see 
Federal Convention). 

Convention, Federal (see Federal 

Cooke, Jay, services in placing 7-30 
loan, 99. 

Co-operation of National banks in 
placing 7-30 loan, 93. 

Court, Supreme, of United States, 
156 ; of Appeals, of State of New 
York, 157; of Errors, of Ken- 
tucky, 158 ; Supreme, of Massa- 
chusetts, 101. 

Counterfeiting, penalty for, 26. 

Crawford, Win. H. , Georgia, Secre- 
tary of Treasury, resigns in 1814, 
31 ; again Secretary in 1816, 16V ; 
reports of, show surplus, 167 ; sug- 
gests that surplus be used in 
internal improvements, 167. 



Credit, revolutionary bills of, bore 
interest, 43 ; of notes receivable 
for duties, good, 90; motion of 
Mr. Hull to revive, of Treasury 
notes, 33. 

Crisis, financial, of 1814, 31 ; of 

1837, 40 ; of 1857, 70. 
Crittenden, John J., Kentucky, op- 
poses use of Treasury notes lu 

1838, 45 ; opposes postponement 
of distribution of surplus, 180. 

Cashing, Caleb, Massachusetts, ar- 
gument of, against Treasury notes 
in 1838, 44 ; opposes postponement 
of payment of fourth instalment, 

DALLAS, Alexander J., Secretary of 
Treasury, 31 ; succeeds Crawford 
in 1S14, 31 ; report to Committee 
on Ways and Means, 31 ; recom- 
mends establishment of National 
bank, 31; mentions Treasury 
notes, 32 ; reports in regard to, 37. 

Danger of increasing Executive 
power, 175. 

Dates of maturity of Treasury notes, 
37 ; of first issues of paper money 
in Colonies, 1 ; of issue and re- 
demption of notes of 1812, 26. 

Davis, Mr. Justice, dissents from 
Chief Justice in first legal-tender 
decision, 160. 

Death of President Harrison, 49. 

Debates, on striking out "emit 
bills," 14 ; on Treasury notes in 
1812, 22 ; on Treasury notes, 1813, 
29; on Treasury notes, 1814, 29; 
on Treasury notes, 1 837, 41 ; on 
Treasury notes, 1838, 43 ; on 
Treasury notes, 1840, 46 ; on con- 
duct of Mexican War, 64 ; on 
legal-tender bill, 124-136 ; on de- 
posit of surplus, 177; on post- 
ponement of fourth instalment, 

Debt, national, highest amount, 85 ; 
proportion consisting of Treasury 
notes, 85 ; in 1812, 21 ; in 1840, 50 ; 
extinguished in 1835, 170. 

Debts and dues, what notes receiv- 
able for (see Treasury Notes and 
Legal Tender). 

Decisions, Bank vx. Supervisors, 157 ; 
Hepburn vs. Griswold, 160; Park- 
er vs. Davis, 162, 163 ; Juilliard vs. 

Greepman, 1fi6, 193; as to claim 
of Virginia for fourth instalment 
of surplus, 1 92 ; Biiscoe vs. Bank of 
Kentucky, and other decisions, see 
note page 44. 

Declaration of war with England, 
22; with Mexico, 63 ; civil war, 83. 

Deficiency in revenues, of Continen- 
tal Congress, 9; in 1812, 21; in 
1813, 29 ; in 1837, 41 ; from 1837 to 
1841, 49; in 1840. 63 ; during civil 
war, 84, 85. 

Demand notes, limitation of amount, 
89 ; first issue of, 89 ; amount is- 
sued, 90 ; difficulty of redemption 
in gold coin, 90 ; retirement of, 
90; action of New York banks 
in regard to, 90 ; Secretary's cir- 
cular as to, 89 ; General Scott's 
circular, 89 ; refused by many, 89 ; 
at a premium, 93 ; denominations 
of, 89. 

Denominations, of notes from 181 2 to 
1815, 38; of notes of period of 
1837,42; Benton moves to make 
lowest 1 00, 41 ; of 7-30 notes, 89; 
of demand notes, 89 ; of frac- 
tional currency, 103 ; of compound 
interest notes, 110; of 5 per cent. 
Treasury notes, 1C9 ; of gold cer- 
tificates 115-155; of legal -tender 
certificates, 116 ; of 4 per cent. 
I certificates, 117 ; of silver certifi- 
j cates, 152. 

i Deposit Act (see Deposit of Surplus, 
also page 40) regarded as contract, 
j 187. 

Deposit of public money with State 
banks, 40, 182. 

Depository banks, regulation of, 40 ; 
amounts due from, 43 ; number of, 
182 ; all but six suspend specie 
payment, 183 ; losses on account 
of, 183. 

Deposits of surplus with States, pro- 
position for, in 1827, 1 67 ; Presi- 
dent Jackson's message regarding 
constitutionality of, 168 ; Jack- 
son's message of 1830, 170 ; change 
of Jackson's views in 1836, 172 ; 
act of June 23, 1836, authorizing, 
178; Secretary Woodbury disap- 
proves of, 171 ; approved by Presi- 
dent with reluctance, 178; pro- 
visions of law regulating, 179; 
amounts to be deposited, 180; 



.postponement of fourth instal- 
ment of, 187 ; Mr. Buchanan's 
amendment relative to, 186 ; 
favorably regarded by opponents 
of the administration, 175 ; propo- 
sitions for. made through press, 
177 ; suggested by Secretary Dix 
that it be withdrawn, 189 ; with- 
drawal dependent on future act of 
Congress, 193; use of, by States, 

Deposits. U. S. change from Bank of 

the United States, 175. 
Depreciation of Colonial paper 

money, 45 ; of Continental paper 

money, 9 ; loss from, 10 ; of 
from 1812-1815, 395 ; of notes of 
1837, 44. 

Description, of notes of 1812, 25 ; of 
notes of 1813,30; of notes of 1814, 
30 ; of notes of 1815, 34 ; of notes 
of 1837, 42 ; of notes of 1838-1840, 
45, 40 ; of endorsement on spurious 
. notes, 52; of notes of 1846, 64 ; of 
notes of 1857-58, 71, 72 ; of 7-30 
notes, 87 ; of fractional currency, 
103 ; of compound interest notes, 
110 ; of 5 per cent, notes, 109 ; of 
demand notes, 93 ; of 3 per cent, 
certificates, 114 ; of gold certifi- 
cates, 115, 155; of legal-tender 
certificates, 116; of 4 per cent, 
certificates, 117; of silver certifi- 
cates, 152, 155. 

Dexter, Samuel, regarded the emis- 
sion of bil s by banks chartered by 
States as unconstitutional, 12. 

Dickersori, Mahlon, New Jersey, au- 
thor of bill to distribute surplus, 
introduced and discussed in 1827, 

Differences between colonial gover- 
nors and legislatures, 3. 

Difficulties in transferring public 
funds, 32 ; in paying fourth in- 
stalment of surplus, 185 ; in effect- 
ing loins, 22, 39, 50, 72, 78. 

Disappearance of silver change, 100. 

Discount on U. S. loans, 39, 72. 

Discussion, general, of the legal- 
tender question, 144; of the coin- 
age act of 1873, 151. 

Dissenting opinions of Justices 
Miller, Davis, and Swayne in first 
legal-tender case, 16 ; " of Chief- 
Justice Chase, Nelson, Field, and 

! Clifford in second legal-tender 
| case, 164; of Justice Field in 
I third legal-tender case, 166, 210. 
Distribution of revenues from public 
I lands, 175; of all revenues, 175; 
! annual, recommended, 176 ; op- 
posed by Benton, 176 ; paragraph 
! in Philadelphia National Gazette 
| advocating, 177; bill for, intro- 
| duced in Senate, 177; regarded 
I as unconstitutional, 177 ; changed 
I to a deposit with States, 178, 
Dix, John A., Secretary of the 
Treasury, 76 ; opens bids for 
Treasury notes, 76; letter to 
| Chairman of Ways and Means 
I Committee, 77 ; recommends with- 
I drawal of deposits made with 
1 States, 78, 189; succeeded by 
i Chase, 80. 

EAGERNESS of people to obtain 
| postal currency, 104 ; to obtain 

4 per cent, certificates, 117. 
: Effect of amendment of Mr. Bu- 
chanan's to postponement bill, 
! 186. 

Ellsworth, Oliver, against paper 
money in the Federal Convention. 

! 15 -' 

! Emissions of paper money, colonial, 
in the colony of Massachusetts, 1 ; 
in other colonies, 1 ; by means of 
banks, 2-5; attitude of mother 
country toward, 5 ; Gov. Belcher's 
proclamation, 5 ; Parliament for- 
bids 7 ; legal tender prohibited, 8 ; 
by Continental Congress, author- 
ized, 9 ; depreciation of, 9 ; amount 
of, 10 ; loss to people from, 10 ; ef- 
fect of on Federal Constitution, 
10-12 (see Treasury Notes). 
1 England, declaration of war with, 
j 22 ; treaty of peace with, 34. 
i Enterprises, private banking, re- 
I stricted by act of Parliament, 7. 
i Eppes, John W., Virginia, Chair- 
I man of Committee of Ways and 

Means. 32 ; report on Treasury 
notes in 1814, 32. 

Estimates, of amounts of Conti- 
nental currency, 10 ; of deficiency 
for year 1813, 29 ; of balance in 
Treasury, 1838, 43; of revenue 
under tariff of 1842, 63; of re- 
ceipts and expenditures in 18i7,. 



70 ; of Secretary Chase of require- 
ments for year 1861, 2, 86; of 
surplus revenues, 167 ; of defi- 
ciency in revenue for year 1841, 
49 ; of amount of public debt in 
the year 1841 , 50 ; of deficiency in 
the year 1846, 63. 

Evils of paper money in colonies, 

Ewing Thomas, Ohio, appointed 
Secretary of Treasury by Harrison, 
4:9 ; report on expenditures of Gov- 
ernment, 49 ; estimates of public 
debt, 50; resigns, 50. 

Excess of bank reserve invested in 
3 per cent, certificates, 114. 

Expectations of States receiving 
deposits of surplus, 187. 

Expedients to prevent depreciation, 
of colonial paper money, 4 ; of 
Continental money, 9. 

Expense of printing and prepar- 
ing Treasury notes, how paid, 26. 

Expiration of authority to issue 
Treasury notes in 1839, 45 ; in 
1842, 51. 

Extra session of Congress, in Sep- 
tember, 1837, 183 ; in July, 1861, 

FAC-SIMTLE of large notes of 1815, 
35 ; of small notes of 1815, 36 ; of 
$100 notes of 1840, 47 ; of note of 
March 3, 1843, end of text; of 
31CO note of 1S46, 65 ; of 100 note 
of 1847, 67; of $100 note of 1857, 
73 ; of $50 note of March 2, 1861, 
81 ; of demand note, 91 ; of seven- 
thirty note of March 3, 1865, 10j ; 
of fractional currency, 105-108; 
of compound interest note of 1SG4, 
111, 112. 

Faith of Government pledged for 
payment of Treasury note >, 2 1. 

Favoritism, alleged, shown to banks, 
29, 42; to deposit banks, i:2, 

Federal Constitution, original draft 
of, 13 ; debate on clause relative to 
emission of bills of credit, 1418 ; 
power to emit bills struck out, 16; 
States deprived of authority to 
issue bills, 13 ; comments of Mr. 
Justice Strong, 11; views of Daniel 
Webster, 11. 18 ; power of State 
to create banks to issue bills under, 

11 ; opinion of Samuel Dexter, 12; 
opinion of Secretary Chase, 12. 

Federal Convention, when held 13 ; 
debate in, on power to emit bills, 
14 ; motion of Gouverneur Morris, 
14; Mr. Butler seconds, 14; re- 
marks of Mr. Madison, 14; re- 
marks of Mr. Gorham, 14 ; remarks 
of Messrs. Mason, Mercer, Ells- 
worth, Randolph, Wilson, Butler, 
Read, Langdon, 14-16; Mr. Mar- 
tin delegate to, 16 ; report on pro- 
ceedings of, by Mr. Martin. 17; 
vote of States, 16 ; vote of Virginia, 

Fessenden, Wm. P., Maine, Chair- 
man of Finance Committee of 
Senate, 130 ; introduces legal-ten- 
der bill, 130; opens debate, 130; 
Secretary of the Treasury, 110 ; 
authorizes issue of compound in- 
terest instead of seven - thirty 
notes, 110 ; extract from report of, 

Field, Mr. Justice, of Supreme 
Court of United States, concurs 
with Chief Justice in first legal- 
tender decision, 158 ; concurs in 
dissenting opinion of Chief J ustice 
in second legal-tender decision, 
164 ; dissents singly to the third 
I legal-tender decision, 166, 210. 
! Fillraore, Millard, New York, Chair- 
man of Committee of Ways and 
Means, 50 ; introduces a bill for a 
loan, 50; concedes that the lovin 

shall be for short term, 50 ; intro- 
duces Treasury note bills, 51 ; op- 
poses postponement of fouith 
instalment 187. 

First issue of colonial paper money, 
1 ; of Continental paper money, y ; 
of Treasury notes, 25. 

First three instalments of surplus 
money, payment of, 40, 181. 

Fiscal operations of Government 
embarrassed in 1814, 32. 

Five-dollar demand notes issued, 89. 

Five Treasury note acts of period 
of 1812, 38. 

Folger, Charles J., New York, Sec- 
retary of Treasury, 191 ; letter of, 
relative to fourth instalment of 
surplus, 192 ; mandamus on, 192. 

Form of Treasury notes (see Fac- 



Forms used in making deposit with General sentiment in favor of Treas- 
States, 181 ; used in withdrawing ury notes in 1847, 64. 
money from depository banks, Gold and silver coin only can be 
182. made a legal tender by States, 13 ; 

Fort Sumter, attempt to relieve, 80 ; , only legal tender until passage of 
attack on and surrender of, 83. ! legal-tender act in 1862, 19. 

Forward, Walter, Pennsylvania, Gold coin, demand notes payable in, 
Secretary of Treasury, 50 ; sue- j 90, 91 ; seven-thirty notes payable 
ceeds Mr. Ewing, 50 ; succeeded i in, 93 ; the standard after 1873, 

by John C. Spencer, 52. 
Fourth instalment of surplus, dif- 
ficulty in paying, 183 ; bill to post- 


j 150 ; over-valued by Act of 1834 
] and took place of silver, 148. 
| Gorham, Nathaniel, Massachusetts, 

pone payment of, 184; debate on ; remarks in Federal Convention. 14. 

postponement of, 187, 1S8 ; post- j Gouverneur Morris, remarks in Fed- 

ponement of, 188 ; demand for, ! eral Convention, 14. 

made by Virginia and Arkansas, [ Government, Federal, operations of, 


Fractional currency, necessity for, 
100; Act of July 17, 1863, author- 
izing postal, 100 ; denominations 
of, 103 ; receivable in sums of 85 
for dues, etc., 103 ; fac-similes of, 
105-108 ; issue of, by private per- 
sons, corporations, etc. , prohibited, 
103 ; amount of limited, 103 ; ex- 
changeable for United States notes 
in sums not less than three dollars, 
104 ; people anxious to obtain, 

in 1814, 31 ; deprived of use of 
specie, 14, 33; Treasury notes 
based on faith of, 24 ; Treasury 
notes 1812-1815 receivable for 
dues to, 24, 29, 39 ; Treasury notes 
1837 receivable for dues to, 42, 65; 
Treasury notes of 1857 receivable 
for dues to, 73 ; Treasury notes of 
1861 receivable for dues to, 81; 
loan certificates to be receivable 
for dues to, 43 ; credit of, affected 
by political complications, 72. 

104; p'aid'in sheets to army, 104; Government of Confederate States, 
total amount issued, 104; wore | organization of, 83. 
out rapidly, 104 ; replaced by sub- Governor Belcher, Massachusetts, in- 
sidiary silver coin, 105. j trigues of paper money advocates 

Funding, of legal-tender notes pro- [ against, 4 ; differences with Legis- 
vided for, 127, 1 36 ; of legal-tender lature, 6 ; forced to retire, 4 ; 
notes to cease after certain date, Governor of New Jersey, 4 ; letter 
138 ; of seven-thirty notes, 98 ; .of | to Hutchison, 6. 
one- and two-year notes into com- j Governors of Massachusetts, opposi- 
pound interest notes, 110, 115 ; of j tion to paper money, 3. 
compound interest notes into three ' Gray, Mr. Justice, delivers opinion 
per cent, certificates, 113, 115 ; of 1 of court in third legal tender de- 

reasury notes of 1812-1815, 38. 
?unds, public, difficulty in transfer- 

cision, 193. 

ring' 33 ke'pt with banks, 29, 40, j HALSTED, WILLIAM, New Jersey, 
182 ; kept with Bank of United j claims that deposit act was not a 
States, 40; changed to State banks, j contract, 187. 

175 ; unavailable, 43, 78, 183; losses 
of, through banks, 43, 183. 

GALLATIN, ALBERT, Secretary of 
the Treasury, 21 ; first suggests 
issue of Treasury notes, 22; his 
plan for Treasury notes, 22 ; letter 
of, to Chairman of Ways and 
Means Committee, 22. 

General Scott, his circular to the 
army as to demand notes, 89. 

Hamilton. Alexander, report on Na- 
tional Bank, 19; opinion as to 
emission of bills of credit by Gov- 
ernment, 19; never suggested 
Treasury notes, 23. 

Harrison, "William H., elected Presi- 
dent by Whig party, 49 ; appoints 
Ewing Secretary of Treasury, 49 ; 
death of, 49; policy of administra- 
tion changed by death of, 

Hickman, John, Pennsylvania, votes 



for legal-tender bill as a necessity, 

Hooper, Samuel, Massachusetts, pre- 
pares National Bank bill, 120; re- 
marks on legal -tender bill, 124. 

House of Representatives, refuses 
to consider resolutions to make 
Treasury notes a legal tender, 33 ; 
does not discuss proposition to 
make loan certificates a legal ten- 
der, 43; long session of, in 1840, 
46 ; objects to Senate introducing 
money bill, 41 ; action of (see Bills 
and Acts). 

Howell Cobb, Georgia, Secretary of 
Treasury, 70; estimates for year 
1857, 70 ; recommends Treasury 
notes, 70; invites proposals for 
loan, 72 ; recommends that public 
lands be pledged for payment of 
Treasury notes, 75. 

Hutchison, Edward, Massachusetts, 
forms specie bank, 3. 

Hutchison, Thomas, Massachusetts, 
letter to, from Governor Belcher, 6. 

INCREASE of public debt, from 1837 
to 1841, 50 ; from 1841 to 1844, 63 ; 
from 1844 to 1861, 72; to August 
81, 1865, 85. 

Independent Treasury Act, repeal 
of, 50. 

Ingham, Samuel D., Secretary of 
Treasury, 168 ; estimates for 'year 
1829, 168 ; reports aniount applica- 
ble to payment of debt, 168 ; re- 
ports probable surplus, 168. 

Interest, paper money issued by 
States during Revolution bore, 44; 
on Continental money, '.) ; on Treas- 
ury notes of 1812, 25; on notes 
of 1813, 1814, and 1815, 39; small 
notes of 1815 bore no, 34; on notes 
of 1837. 42; on notes of 1838, 45 ; 
nominal, of one mill per cent., 46 ; 
on notes issued by Secretary Spen - 
cer, 52 ; report on, by Committee 
of Ways and Means, 56 ; on notes 
of 1846, 64 ; on notes of 1847, 69 ; 
on notes of 1857, 71 ; bids on notes 
of 1860, 76 ; on notes of 1861, 8't ; 
on notes of the civil war, 88, 1 CO, 
110; on certificates, 114, 116, 117. 

Introduction of bills (see Bills). 

Issues, paper money, in Colonies, 
object of, 1 ; by means of loan 

banks, 2 ; by merchants of Boston, 

I 2 ; by Hutchison's specie bank, 3 ; 

opposition to, by Parliament, 3 ; 

! Acts of Parliament prohibiting, 3, 

7 ; depreciation of, 5 ; loss, and 

money inflated by, 4. 

Issues of paper money by Conti- 
nental Congress, first issue of, 9 ; 
depreciation of, 9 ; bought in at 
market value for coin, 9 ; new in 
place of old, 9 ; total amount of, 
10; loss on, 10; antipathy to, 10. 

Issues of paper money from 1812 to 
1815 (see Notes, Treasury, from 
1812 to 1815). 

Issues of paper money of period of 
1837 (see Notes, Treasury, of pe- 
riod of 1837). 

Issues of paper money of Mexican 
War (see Notes, Treasury, of Mex- 
ican War). 

Issues of paper money of Buchan- 
an's Administration (see Notes, 
Treasury, of Buchanan's Adminis- 

Issuer, of paper money of Civil War 
(see Notes, Treasury,of Civil War). 

JACKSON, ANDREW, President of 
United States, 168 ; message to 
Congress of 1829, 168; thinks use 
of surplus for internal improve- 
ments unconstitutional, 169; ad- 
vises apportionment of surplus 
among States, 169 ; message of 
1830, 170; views as to surplus, 
change in 1836, 171 ; causes of 
change in his views, 172 ; message 
of 1836, 173 ; attack on Bank of 
the United States, 174 ; declares 
in 18^9 against recharter of bank, 
174 ; determines to receive public 
deposits from bank, 174 ; disa- 
grees with his Cabinet, 174; reads 
paper to Cabinet, 1 74 ; makes 
Taney Secretary of Treasury, 175 ; 
orders removal of deposits, 1 75 ; 
proposes method of distribution cf 
surplus, 1 79. 

Jay Cooke, services of, in placing 
seven-thirty loan, 99. 

Justice Story, comments on consti- 
tutionality of issue of notes by 
bank chartered by State, 11. 

Justices of Supreme Court, in 1869, 
158; in 1871, 162. 



setts, remarks of, on legal-tender 
bill, 125. 

King, of England, issue of paper 
money in Colonies to be under 
control of, 7. 

LAND Bank, proposed by John Cole- 
man in 1715, 1 ; second, proposed 
in 1739, 2 ; plan of, 2 ; opposed by 
Governor Belcher, 3. 

Langdon, John, New Hampshire, 
remarks in Federal Convention, 

Laws (see Acts and BillsV 

Legal tender, paper money prohib- 
ited in Colonies. 8 ; gold and silver 
coin, only, a, under Constitution 
prior to 1852, 19; proposition to 
make Treasury notes a, rejected, 
33 ; proposition to make loan cer- 
tificates a, rejected, 43 ; Conti- 
nental Congress had no power to 
make paper, 117; States pass ten- 
der laws, 119 ; discussed in Fed- 
eral Convention, 14. 

Legal-tender Acb, bill introduced in 
Committee by Mr. Spaulding, 120 ; 
letter of Attorney-General Bates 
in regard to, 121 ; reported to 
House, 121 ; hostility of the press, 
121 ; hostility of the banks, 121 ; 
bill submitted to the Secretary, 
121 ; again reported to House with 
the Secretary's amendments, 121 ; 
passed the House, 121 ; vote on 
bill in House, 121 ; amendments in 
Senate, 122; charactar of debate, 
122; Secretary Chase's letter to 
Committee of Ways and Means, 
122 ; bill thoroughly discussed 
throughout the country, 124; a 
measure of necessity, 124 ; ex- 
tracts from debate in Senate, 130- 
135 ; Conference Committee, 13 ; 
approved by President February 
25, 1862, 136 ; of 1862, authorized 
issue of 150 millions dollars in 
notes, 136 ; of June 11, 1862, 138 ; 
of March 3, 1863, 138; policy of, 
discussed by Mr. Elaine, 146-147 ; 
Secretary McCulloch's opinion of, 

Legal-tender decisions, Bank v. Su- 
pervisors, 156-157; Hepburn v. 
Griswold, 157-161 ; Parker v. Da- 


vis, 161-165 ; Juilliard v. Green- 
man, 165, 193 ; dissenting opinions, 
160, 164, 166, 210. 

Legal-tender notes, authorized by 
act of February 25, 1862, 136; 
bore no interest, 136 ; payable to 
bearer at Treasury, 136; denomina- 
tions not less than $5, 136 ; differed 
from demand notes, fundable into 
bonds, 136; receivable for all 
debts, public and private, except 
duties on imports, 137 ; descrip- 
tion of, 137 ; act of June 11, 1862, 
authorizes under $5, 138; whole 
amount authorized, 138 ; restric- 
tion on funding, 138 ; effect of re- 
striction, 138 ; highest amount 
outstanding, 139; retirement of 
under Secretary McCulloch, 140; 
increase under Secretaries Bout- 
well and Richardson, 140 ; restric- 
tion of amount in 1874, 140; re- 
tirement after 1875, 140; amount 
outstanding fixed in 1878, 141 ; 
amounts at various dates, 142 ; 
payment on presentation in coin, 
143; certificates of deposit for 
(see Certificates, Legal-tender). 

Legal reserve of national banks, 
gold certificates held as, 155 ; sil- 
ver certificates held as, 155; cer- 
tificates for legal-tender notes held 
as, 116 ; three per cent, certificates 
held as, 114. 

Legislature of New York, action 
remitting taxes on U. S. securi- 
ties, 156. 

Legislatures of States accept depos- 
its of surplus money, 181. 

Letter, of Governor Belcher to 
Thomas Hutchison, 6 ; of Mr. Bol- 
lan, agent, 7; of Secretary Gd Da- 
tin to Committee of Ways and 
Means, 22 ; of Secretary Chase to 
Committee of Ways and Means, 
122; of Secretary Chase to Mr. 
Spaulding, 124 ; of Secretary Spen- 
cer to Committee of Ways and 
Means, 53. 

Lincoln, Abraham, President of the 
United States. 117; signs legal- 
tender act, 117. 

Loans, temporary, of 1810, 22; of 
1813, 29 ; policy of Congress as to, 
in 1812-15, 33 ; authorized in 1815 to 
fund Treasury notes, 34 ; discount 



on, from 1812-15, 39 ; bill for, in- 
troduced by Millard Fillmore, 50 ; 
object defeated, 50; Treasury notes 
a form of, 59 ; Treasury notes of 
Mexican War fundable into, 69; of 
18BO, 72; of 1861, 79; on August 
31, 1865. 85 ; temporary, 85 ; by the 
New York banks, 95 ; seven-thirty 
notes a popular, 99; for funding 
legal-tender notes, 117; obtained 
on security of Treasury notes, 25 ; 
to aid in resumption of specie pay- 
ments, 141. 

Loan banks, bills issued by, 2. 

Losses on colonial paper money, 4 ; 
on Continental paper money, 10; 
on fractional currency, 104. 

MADISON, JAMES, remarks on Fed- 
eral Convention, 14 ; note on vote 
of Virginia, 16. 

Mandamus on Secretary of Treasury 
by State of Virginia, 192. 

Marshall, Chief Justice, definition 
of bills of credit, 44. 

Martin, Luther, Maryland, delegate 
to Federal Convention, 16; address 
to Maryland Legislature, 17 (also 
see note on page 16). 

Mason, George, Virginia, remarks on 
Federal Convention, 14. 

Massachusetts, paper money issues 
in, 1; loan banks, 2; specie banks, 
2, 3 ; governors of, oppose paper 
money, 3 ; makes Continental 
money a legal tender, 119. 

Maximum of public debt, 85 ; of le- 
gal-tender notes, 188 ; of Treasury 
notes prior to civil war, 52, 69, 79 ; 
of fractional currency, 104. 

McCulloch, Hugh, Secretary of the 
Treasury, 139 ; opinion of Legal- 
tender Act, 139 ; retires legal-ten- 
der notes, 140. 

Measures (see Bills and Acts). 

Mercer, John F. , Maryland, friendly 
to paper money in Federal Con- 
vention, 15 ; remarks of, 15. 

Mexico, declaration of war with, 63. 

Miller, Mr. Justice, dissents to first 
legal-tender decision, 160. 

Money, power of Congress to bor- 
row. 59, 159; borrowed on security 
of Treasury notes, 25 ; specie, stock 
diminished, 31 ; Continental, made 
legal tender by States, 119; colonial 

paper, 2; surplus of United States 
(see Deposit of Surplus); legal-ten- 
der (see Legal-tender); power of 
Congress to coin, 11. 

Morrill, Justin S. , Vermont, remarks 
on Legal-tender Act, 129. 

Morris,' Gouverneur, moves to strike 
out "emit bills" from draft of 
Constitution, 14. 

NATIONAL bank, Secretary Dallas 
recommends establishment of, 31 ; 
bill for, referred to committee, 2 ; 
bill for, vetoed by President Tyler, 

National banks, bill for, prepared, 
120 ; co-operation of, in placing 
seven-thirty loan, 99. 
National debt in 1812, 21 ; extin- 
guished in 1835, 170; amount of, 
in 1841, 50 ; "amount of, in 1860, 
72 ; maximum of, in 1865, 85 ; 
form of, in 1865, 85. 
Newcomb, Prof. Simon, criticism 
npon Silver Commission, 151 (see 
also note at foot of page 151). 
New York City banks, action of, as 
to demand notes, 90 ; first seven- 
thirty loan negotiated by, 93; 
total amount of seven-thirty notes 
taken by, 93 ; arrangements of, for 
placing" seven-thirty loans, 93 ; re- 
port of Loan Committee of, 94 ; 
Secretary Chase's report in regard 
to action of, 95 ; loans made by, 
in 1861, 96. 

Niles, John M., Connecticut, op- 
poses Mr. Buchanan's amendment 
I to postponement bill, 186. 
' Niles' Register, extract from, relative 
to Treasury notes of 1812, 26 ; 
notice of distribution of surplus 
sent to banks, 131. 
Note of Madison on vote of Virginia 

in the Federal Convention, 16. 
Notes, compound interest (see Com- 
j pound interest notes). 
i Notes, Exchequer, recommended by 
I President Tyler, 53. 
[ Notes, fractional (see Fractional 
! currency). 

Notes, legal-tender (see Legal-ten- 
der notes). 

Notes, one- and two-year (see One- 
and two-year notes) . 



Notes, seven-thirty (see seven- 
thirty notes). 

Notes, Treasury (see Treasury 

OBJECTIONS to issue of Treasury 
notes 1812-1815, 22, 29,32 ;-to issue 
of Treasury notes in 1837, 41, 44, 
46, 53 ; of Committee on Ways and 
Means to spurious notes, 53 ; to 
legal-tender bill, 128 ; Woodbury's 
to distribution of surplus, 171 ;*to 
postponement of fourth instal- 
ment, 186 ; to loan bill of 1841, 50. 

Obligations of the United States, 
legal-tender notes held not to be, 
150 ; legal-tender notes held to be, 

One and two year notes of 1863, 109 ; 
bore interest at five per cent., 110 ; 
redeemed in compound interest j 
notes, 110. 

Opinion of Hamilton on authority of 
Government to emit paper money, 
19 : of Samuel Dexter as to rightf j 
of States to charter banks to issue 
notes, 12 ; of Chief Justice Chase, 
12 ; of Secretary McCulloch, as to 
Legal-Tender Act, 139 ; of At- 1 
torney-General Bates as to legal- I 
tender bill, 121. 

Opinions of courts. (See Decisions.) 

Opposition of President Jackson to 
distribution of surplus, 171 ; to ; 
bill postponing payment of fourth 
instalment, 180 ; of newspapers 
and banks to legal-tender bill, 121. ! 

Outstanding Treasury notes, 71, 118. 

PAPER read by President Jackson 
to his cabinet, 174. 

Paper money of the colonies, first 
issued in Massachusetts, 1 ; issued 
in other colonies, 1 ; dates of first 
issues, 1 ; issued by loan banks, j 
2 ; rate of interest on, 2 ; payable I 
in silver issued by merchants in 
Boston, 2; prohibited by Parlia- 
ment, 37 ; opposition of governors 
to, 3; intrigues of advocates of, 
4 ; depreciation of, 4 ; terms ap- 
plied to, 4 ; loss and misery in- 
flicted by, 4 ; value in coin in dif- 
ferent States, 5 ; disputes about, 
7 ; attitude of mother country, 7. 

Paper money of Revolution emit- 

ted by Continental Congress, 9 ; 
first issue of, 9; depreciation of, 
9, 10; new issue bearing interest 
payable in coin, 9; amount lim- 
ited, 10 ; redeemable in coin at 
market value, 9; ceases to circu- 
late, 10 ; loss through, 10 ; made a 
legal-tender in certain States, 119 ; 
issued by States, 10. 

Paper money under constitution, 
power of States to emit, taken 
away, 10, 13; power of States to 
charter banks to issue, doubted, 11, 
12 ; discussion on, in Federal con- 
ventions (see also Notes). 

Paris, Silver Commission meets at, 

Parker v. Davis, legal-tender case, 

Parliament, acts of, in reference to 
paper money. 7. 

Pay of signers of Treasury notes, 25. 

Payment of fourth instalment of sur- 
plus postponed, 188. 

Payment, specie, suspended in 1814, 
31; suspended in 1837, 40; re- 
sumption of, in 1838, 43 ; suspen- 
sion of, in 1857, 70 ; suspension of, 
in 1861, 84 ; resumption of, on 
January 1, 1879, 141. 

Peace, treaty of, with England, 34. 

Pelatiah Webster recites evils of 
Colonial paper money, 4. 

Pendleton, George H., Ohio, remarks 
of, on legal-tender bill, 128. 

People, seven-thirty loans taken by 
the, 98 ; anxiety of, to obtain frac- 
tional currency, 104 ; anxiety of, to 
obtain four per cent, certificates, 

Pickens, Francis W. , South Carolina, 
on postponement of fourth instal- 
ment of surplus, 138. 

Plan for Treasury notes, Secretary 
Gallatins, 21; Secretary Dallas', 

Plans of States to use surplus depos- 
ited, 190. 

Postage stamps used for change. 100. 

Postal currency (see fractional cur- 

Postmaster-General's report on use 
of postage stamps for change, ICO. 

Postponement of fourth instalment, 
rendered necessary by financial 
pressure, 182; extra session of 



Congress called to consider, 183 ; 
President Van Buren on, 183 ; bill 
for, introduced by Silas Wright, 
184 ; long debate on. in House and 
Senate, 184, 187 ; bill for, amended, 
187 ; bill for, passed, 188. 

Power of Executive, select commit- 
tee to inquire into, 175. 

Prejudices against Treasury notes, 

Premium, on small Treasury notes 
of 1815, 37 ; on Treasury notes of 
1837, 45; on 5 per cent. U. S. 
stock, 72 ; on demand notes, 93 ; 
on gold, 97, 100; on four per 
cent, bonds, 117. 

Preparations of Secretary Woodbnry 
for distribution of surplus money, 
181, 182. 

Presidents, Jackson, 168,170, 172; 
Harrison, 49 ; Tyler, 53 ; Van 
Buren, 183 ; Lincoln, 117 ; Hayes, 

Preston, William C., South Caro- 
lina, opposed to Treasury note bill 
of 1838, 45 ; opposes postpone- 
ment of fourth amendment, 186. 

Proclamation of Governor Belcher, 

Provincial Governors, trouble with 
their Legislatures, 3. 

Public advertisement for bids for 
Treasury notes, 71, 76 ; for loans, 

Public debt (see National debt). 
Public lands, distribution of revenue 
from, 175 ; distribution of, 175. 

QUOTATIONS of coin valueof Colonial 
paper money, 5 ; of bids for Treas- 
ury notes in 1861, 76; of bonds, 
notes and gold for 1862, 1863, 1864, 

Quotations from Governor Belcher's 
proclamation, 5 ; from Chief Jus- 
tice Story, 11; from Secretary 
Chase, reports and letters, 12, 86, 
95, 12, 124; from Daniel Webster, 
18; from debate in Federal Con- 
vention, 14 ; from Luther Martin, 
16 ; from Niles' Register, 26 ; 
from Secretary Dallas, 31 ; from 
report of Committee on Ways and 
Means, in Spencer's notes, 5, 3; 
from Secretary Dix, 77, 189 ; from 
General Scott's circular, 91 ; from 

report of associated banks, 94 ; 
from Secretary McCulloch, 98, 
139; from Postmaster -General's 
report, 100 ; from debate on legal- 
tender bill, 124-135; from James 
G. Elaine, 144-147; from Prof essor 
Newcomb, 151 ; from legal-tender 
decisions, 157, 162 ; from Presi- 
dent Jackson, 168, 170,174; from 
Secretary Woodbury, 171 ; from 
Thomas H. Benton, 190. 

RANDOLPH, EDMUND, Virginia, re- 

marks in Federal Convention, 15. 
Rates of interest (see Interest). 
Read, remarks in Federal Conven- 

tion, 16. 
Reasons for failure of loan bill of 

1841, 50. 

Rebellion, war of, inaugurated, 83. 
Rebellious demonstrations among 

colonists, 6. 
Receipts, from sale of public lands, 

171 ; from loans, 1812-1815, 39. 
Re-charter of Bank of U. S. op- 

posed by President Jackson, 174; 

bill for, passes both Houses, 174 ; 

bill for, vetoed, 174; made an 

issue in campaign of 1832, 174. 

Refusal of Whigs to vote on 
Treasury note bill in 1840, 96. 

Register of Treasury, notes first 
signed by, 42. 

Reissues of Treasury notes (see 
Treasury notes). 

Removal of deposits from Bank of 
U. S., 175. 

Report of Hamilton on a National 
bank, 19; of Secretary Dallas in 
1814, 32 ; of Mr. Eppes, 32 ; of 
Secretary Dallas in 1815, 37; of 
Secretary Woodbury in 1839, 45 ; of 
Secretary Woodbury in 1840, 49 ; 
of Secretary Ewing in 1841, 49 ; of 
Committee of Ways and Means on 
Spencer's notes, 54 ; of Secretary 
Cobb in 1857, 70; of Secretary 
Cobb in 1860, 72; of Secretary 
Chase, for year 1861, 86, 95 ; of 
loan committee of associated 
banks of New York City, 94 ; of 
Secretary McCulloch for 1865, 98 ; 
of Postmaster-General in 1862, 
100 ; of Deputy Comptroller of 
Currency in 1870, 100; of Paris 
silver commission, 151 ; of Secre- 



taries Crawford, Rush, and sue- ' 
cessors, 167 ; of Secretary Ingham I 
in 1829, 168. 

Reserve, National Bank (see Na- 
tional Bank Reserve). 

Resolution of Continental Con- 
gress recommending that States ; 
make paper issues legal tender, 
117 ; of associated banks in New ] 
York City, 90 ; making Treasury 
notes a legal tender, 33. 

Resumption of specie, payments, 
in 1838, 43; on January 1, 1879, 
141 ; act of 1875 requiring, 141 . 

1864, authorizing second issue, 97 ; 
act of March 3, 1805, authorizing 
third issue, 97 ; denominations 
of, 98 ; last two issues fundable 
into bonds, 98; a popular loan, 
98 ; services by Jay Cooke in 
negotiating, 99 ; co-operation of 
national banks, 99 ; form of, 100 ; 
reverse described, 99. 
Sherman, John, Secretary of Treas- 
ury, favors legal tender clause. 132; 
votes in favor, 135 ; member of 
Conference Com., 130 ; sells bonds 

to prepare for resumption, 141 ; 

Revenues from public lands, distri- confidence of note holders in. 143. 
bution of, 175; surplus (see Stir- Signers of Treasury notes, pay of , 25. 
plus Revenues) ; deposited with Silver certificates authorized, 152 ; 

State banks, 40, 182. 

Revenues for 1837, 41 ; expenditures 
exceed, from 1837 to 1841, 49. 

Richardson, Secretary, increase of \ 
legal-tender notes under adminis- 
tration of, 140. 

Rush, Richard, Secretary of Treas- 
ury, 167. 

SCOTT, GENERAL, issues circular 

denominations of, 152 ; coin depos- 
ited for, to be returned in Treasury, 
152 ; amount outstanding, 153 ; 
not a legal-tender, 155 ; count as 
reserve of national banks, 155; 
receivable for Clearing-house bal- 
ances, 155, receivable tor customs, 
taxes, and all public dues, 152 ; 
dangerous substitute for money, 

Silver coinage, acts regulating, 148, 
149, 152. 

about demand notes to army. 
Secession of Southern States, 83. 
Secretaries of the Treasury, Hamil- I Silver commission, report of, criti- 

ton, 19 ; Gallatin, 22 ; Dallas, 31 ; ! cised, 151. 

Crawford, 31, 107 ; Rush, 167 ; ! Silver dollar, authorized by act of 

Ingham, 168; Duane, 175; Taney, ! April, 1792, 148; coinage discon- 

175 ; Woodbury, 41, 42, 45, 49, 

171, 180 ; Spencer, 52 ; Ewing, 

49; Forward, 52; Bibb, 52; Cobb, - 

70 75 Dix, 76, 77 ; Chase, 80, 95, amount outstanding, 

122; Fessenden, 110; Walker, 63; ! continued coinage, 153. 

McCulloch, 98, 139; Richard- Small Treasury notes of 1815, descrip- 

son, 140 ; Sherman, 141 ; Folger, tion of, 34. 

192. | Spaulding, E. G., New York, brings 

Secretary of the Treasury author- ! legal-tender bill before Committee 

ized to borrow money on security 

of Treasury notes, 25. 

tinned by act of 1873, 150; revived 
by act of 1878, 152 ; weight of, 150 ; 
amount coined per month, 150: 
mtstanding, 153 ; effect of 

Series of fractional currency, 103, 
104 ; of seven-thirty notes, 93, 97 ; 
of colonial currency, 4 ; of Conti- 
nental currency, 9. 

Seven -thirty notes, first issue au- 
thorized by acts of July 17, and 
August 5, 1861, 89; suggested by 
Gailatin, 88; interest on first is- 

of Ways and Means, 120 ; intro- 
duces bill in House, 124 ; letter of 
Secretary Chase to, 124; extract 
from speech of, on legal-tender 

Special session of Congress, in 1837, 
183; in 1861,84. 

Specie, difficulty to procure. 31 ; de- 
mand notes payable in, 53 ; legal- 
tenders payable in, after January 
1, 1879, 141 ; first instalment of 

sue paid in sold, 93 ; ftmdable 1, 1879, 141 ; first insta 
into bonds 93 ; negotiation of , surplus paid to States in, 1 
first loan 'on, with New York Specie bank, Hutchison's 3. 
banks, 93, 96 ; act of June 30, Specie payments suspended in 1814, 



31 ; suspended in 1837, 40 ; resmnp- , 
tion of, in 1838, 43 ; suspension of, j 
in 1857, 70 ; suspension of, in 1861, 
84 ; resumption of, by United , 
States on January 1, 1879, 141 ; ] 
all but six deposit banks suspend, I 

Spencer, JohnC., Secretary of Treas- 
ury. 52 ; issues Treasury notes at j 
nominal interest payable on de- ' 
mand, 52 ; his notes investigated , 
by Committee of Ways and Means, j 

State banks, public funds deposited 
with, 40 ; act regulating deposit 
of lawful money with, 40, 178 ; de- ! 
prived of deposits by distribution 
of surplus, 181 ; forms of drafts 
on, 182. 

States recommended to make Con- 
tinental money legal-tender, 119; ; 
paper money issued by, during 
llevolution, 10 ; deprived of au- 
thority to issue paper money, 13 ; 
right to charter banks to issue ! 
notes, 11 ; lack of authority to 
coin money, 11 ; deposit of surplus [ 
with, 181 ; table showing appor- i 
tionment among, 180 ; to give au- 
thority to Treasurers to receive de- 
posit of surplus, 180 ; laws of, rela- 
tive to deposit of surplus. 181 ; | 
use of depo_sits by, 190 ; amounts 
deposited with, carriad on Treas- i 
ury books as unavailable funds, j 
190 ; public works undertaken by, 
186 ; power to borrow money, 59. 

States, Southern, secession of, 83. 

Stevens, Thaddeus, Pennsylvania, i 
close debate on legal-tender bill, j 
126 ; extract from speech on legal- 
tender bill, 126. 

Story, Mr. Justice, comments on 
power of States to charter banks , 
to issue notes, 11. 

Sumter, Fort, effect of attack on, 

Supreme Court decisions in legal-ten- 
der cases (see Decisions and Dis- 
senting Opinions). 

Surplus revenues, estimates from 
1816 to 1829, 167, 168 ; proposition 
to distribute among the States, 
169; Mr. Dickerson ? s proposition 
in 1827, 167 ; estimate of amount 
on January 1, 1636, 171 ; views of 

President Jackson as to disposi- 
tion of, 171-176 ; report of select 
committee on, 175 ; bill to deposit 
with States, 178; apportionment 
among States, 180 Xsee Deposit 
of Surplus with States). 
Swayne. Mr. Justice, concurs in 
dissenting opinion in first legal- 
tender case, 160. 

York, in favor of Treasury notes, 

Taney, Roger P., Secretary of 
Treasury, 175 ; issues orders for 
removal of deposits, 175. 

Tar iff of 1842, 63. 

Taxation, reduction of remedy for 
surplus, 173. 

Tender (see Legal Tender). 

Three per cent, certificates (see 

Three-sixty-five notes proposed, 88. 

Treasuries of colonies, issue of paper 
money by, 1, 2. 

Treasury rotes of 1812-1815 author- 
ized, 25, 29, 30, 33 ; signed by per- 
sons designated by President, 25 ; 
countersigned by" Commissioners 
of Loans, 25 ; money borrowed 
upon security of, 26 ; receivable 
for dues, duties, etc., 26 ; Niles' 
register upon, 26 ; small notes 
of 1815, 34; denominations of, 26, 
30, 38 ; interest on, 39 ; penalties 
for counterfeiting, 26. 

Treasury notes of period of 1837 au- 
thorized, 42, 45, 46, 51 ; signed by 
Treasurer, 42 ; countersigned by 
Register, 42; receivable for all 
debts due Government, 42 ; inter- 
est on, 42, 45, 52 ; denominations 
of, 41, 52 ; payable one and two 
years after date, 51 ; outstanding, 

Treasury notes issued by John C. 
Spencer, 52, 54, 60. 

Treasury notes of Mexican War, 
authorized, 63, 64 ; signed by 
Treasurer and Register, 64 ; other 
features of, 64; amounts issued, 
64, 69 ; denominations of, 64, 69. 

Treasury notes of Buchanan Admin- 
istration, recommended by Sec- 
retary Cobb, 70; authorized, 70; 
features of law authorizing, 71 ; 



offered to lowest interest bidder, 
71 ; amount issued, 71 ; denomina- 
tions of, 71 ; act of December, 
1860, 75 ; operations of Secretary 
Dix, 76. 

Treasury notes of Civil War (see 
Seven-thirty notes, Compound in- 
terest notes. One- and two-year 
notes, and Notes). 

Treasury notes, outstanding in 1884, 
71, 118; forms of, 35, 36, 47, 65, 
67, 73, 81, 91, 100, 105-108, 111- 
112, 137, end of text ; no legal- 
tender until 1861, 117; depreciation 
of, 33, 38, 44, 76, 77 ; premium on, 
37, 45. 

Tyler, John, President, 53 ; vetoes 
"bill to create a National Bank, 53 ; 
recommends bill for Exchequer 
notes, 53. 

UNDERSTANDIXO of Treasury with 

banks in 1862, 95. 
United States, Bank of, question of 

recharter, 174; Jackson's attack 

on, 174 ; veto of recharter bill, 

173 ; removal of deposits, 175 ; 

charter expires, 40. 
United States notes (see Treasury 

notes, and Notes). 
Use of postage stamps for change, 

United States Supreme Court (see 


VALLANDIGHAM, C. L., Ohio, op- 
poses legal-tender bill, 129. 

Van Buren, Martin, President of the 
United States, 183 ; calls extra 
session of Congress, 183. 

Veto of bill rechartering Bank of 
United States, 174; of bill for 
National Bank by President Tyler, 
53; of act for coinage of silver 
dollar by President Hayes, 150. 

Vote of States in Federal Conven- 
tion, 16; on first Treasury note 
bill in House, 25; in House and 
Senate on second Treasury note 

bill, 29 ; on Treasury note bill of 
1837 in House and Senate, 41, 42 ; 
on Treasury note bill of 1838 in 
House and Senate, 45 ; on Treas- 
ury note bill of 1840 in House, 
46 ; on legal-tender bill, 135 ; on 
coinage act of 1873, 150; on de- 
posits of surplus with the States, 
178 ; on postponement of fourth 
instalment, 187 

WAR declared with England, 22; 
declared with Mexico, 63; Jack- 
son's, with Bank of United States, 
174 ; Civil, inaugurated, 83. 

War measure, issue of Treasury and 
legal-tender notes a, 22, 64, i24. 

Ways and Means Committee (see 
Committee of Ways and Means). 

Webster, Daniel, views on right of 
State to charter bank to issue 
notes; 11 ; on legal-tender under 
Constitution, 18. 

Webster, Petaliah, views as to evils 
of paper money in Colonies, 4. 

Whig party, opposition to Treas- 
ury notes, 44, 49; support a loan 
bill, 50. 

Whigs refused to vote in House in 
1840, 46. 

Wilson James, Pennsylvania, op- 
posed to paper money in Federal 
Convention, 15. 

Wise, Henry A., Virginia, favors 
paying fourth instalment, 187. 

Withdrawal of deposits from Bank 
of the United States, 175 ; from de- 
posit banks, 181 ; from States. 190. 

Woodbury, Levi, Secretary of Treas- 
ury, 41 ; recommends Treasury 
notes, 41 ; reports amount of 
Treasury notes outstanding, 46; 
disapproves of distribution of 
surplus among the States, 171 ; 
method of distribution of surplus, 

Wright, Silas, Massachusetts, Chair- 
man Senate Finance Committee, 
184 ; reports bill for postponement 
of fourth instalment, 148, 






Xondon : 


New Work by the iate Editor of " THE EXPOSITOR." 



Author of "Balaam, an Exposition and a Study," " A Commentary on the 
Book of Job," 1 ' " Salvator Mundi," &c. 


1. The Purchase of Opportunities. ] 

2. The Sanitary Order of the Moral j 


3. The Divine Root of the Human 


4. The Children of Wrath. 

5. Abraham. 

6. Religion and Reward. 

7. The City of the Soul. 

8. Nor any other Creation. 

9. The Law of Retribution. 

I0 ' 1 The Prayer of the Remnant. 

12. Forgiveness not Impunity. 

13. Dives and Lazarus. 

14. The Transfiguration. 

15. Faith, a Condition of Miracles. 

1 6. Faith and Unfaith, the Two 

Marvels which astonished 

17. The Righteousness .which is by 


18. Faith, a Condition of Pleasing 


19. The Scope of Prayer. 

20. The Sin unto Death. 

21. Child of the Devil or Child of 


22. The Mission of Christ. 

23. Destruction from the Face of 

the Lord. 

24. The Son of Man the Saviour of 

the Lost. 

25. The Sin of Iscariot. 

26. The Repentance of Iscariot. 

27. Fear cast out by Love. 

28. Spiritual Husbandry. 

29. The Sterner Parables. 

30. The Moral of the Barren Fig 


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March 31, 1885. 





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come to all lovers of Dickens for Dickens' sake." At/iena'itm. 

" Will certainly be read with interest by all who admiie the 
great writer . . . The book will be welcomed by all who are 
eager to learn everything relating to one who has left behind so 
deep an impression on the heirts of mankind." Daily Telegraph. 
" He has told his story in the most effective manner, accom- 
panying a plain and clear narrative with abundant touches of the 
peculiar humour which no friend of Dickens should be without." 
Daily News. 

" George Dolby knew the ' Chief full well, 

And as he knew him drew him ; 
So read the tale he has to tell 

' Charles Dickens as I Knew Him.' " Punch. 
" The book is one which will well repay reading. ... A 
book which gives us so many pleasant pictures of one of the most 
interesting figures in modern literature." Saturday Revieiu. 

of the various Issues of Paper Money by the 
Government of the United States, and of the dis- 
tribution of the Surplus in 1837. With Appendix 
on the Legal Tender Question. By JOHN JAY 
KNOX, late Comptroller of the Currency. With 
Photo- Lithographic Specimens, and Forms of the 
various Notes. Crown 8vo., cloth {Nearly Ready o 12 

' ' A very minute historical sketch of the treasury and other 
notes issued by the Government. . . . The book should be 
carefully studied by those who would understand the subject." 
New York Herald. 

"The book has solid merits, and will be found highly service- 
able by students of our financial history. It would be difficult 
to name any other work in which the currency operations of the 
Treasury and the proceedings of Congress in relation thereto are 
so minutely and impartially described." The Nation (New 

By A. P. ALLEN, An Old Traveller. With Six 
Illustrations. Crown 8vo., cloth ^Nearly Ready 036 

New and Recent Books. 


" Camilla's Girlhood," " In Change Unchanged," 
" In the Golden Shell," &c. With Ten Illustrations 
by Mrs. ARTHUR LEMON. Square Imp. i6mo. ... o 7 6 
' ' Her style is easy and pleasant, and ever and again her remarks 
are happy. . . . Very delightful is the account of the Abetone. " 
Literary World. 

" Next to the privilege of visiting these localities, this book is 
the best thing, and no expense has been spared in making the 
volume an artistic success." Bookseller. 


Pictured by F. CARRUTHERS GOULD. Twenty-two 
Illustrations. Square Imp. i6mo. ... ... ... o 5 o 

"The extravagance of invention displayed in his tales will 
render them welcome in the nursery. The translation, not an 
ensy task, has been very cleverly accomplished. " The Academy. 

"The illustrations are delicately executed, and "the binding is 
one no-child, who is a child, could look upon without delight." 
Whitehall Keview. 

" An admirable translator in Madame Kroeker, and an inimi- 
table illustrator in Mr. Carruthers Gould. . . . The stories deserve 
both the German and the English poet's encomium, and the illus- 
trations are simply irresistible." Truth. 

THE POISON TREE : A Tale of Hindu 
JEE. Translated by M. S. KNIGHT. Introduction 
by EDWIN ARNOLD, M. A., C.S.I. Crown 8vo. ... o 6 o 

" I am glad to recommend this translation to English readers 
as a work which, apart from its charm in incident and narrative, 
will certainly give them just, if not complete, ideas of the ways 
of life of their fellow-subjects in Berfgal. '--Extract from Preface. 

" The healthiness and purity of tone throughout the book. . . . 
In reviewing novels, it is seldom that we regret very seriously the 
limitations of our space ; but we are genuinely sorry that we cannot 
speak at greater length of a book which presents so many points 
of interest." Academy. 

"Admirably translated into English by Mrs. Knight." 


By ANNIE JENKYNS. Crown 8vo o 5 o 

" In delineation of character the authoress is extremely 
clever. "Schoolmaster. 

Mr. T. Fisher Unwin, 26, Paternoster Square. 


conteynynge Thyrtie and Eyghte Wodecuttes 
Illvstratynge the Lyfe, Parablis, and Miraclis off 
Oure Blessid Lorde and Savioure Jhesus Crist, 
with the Propre Descrypciouns theroff extracted 
fro the Originall Texte off lOHN WICLIF, somtyme 
Rector of Luttenvorth. With Preface by the late 
Dean of Westminster. Square 8vo. Bound in 
Parchment, old style ; brass clasps ... ... o 10 

A very interesting volume, elegantly bound in a cover copied 

from an old book in the British Museum." Bibliographer. 

' ' The illustrations are grotesque and quaint specimens of early 

art, and the whole book with its mysterious history, and its evident 

function as an instructor of the illiterate, is extremely suggestive 

and interesting. "Literary World. 

Shakespeare's "As You Like It." ARTISTS' EDI- 
TION. Illustrated with Seven Photogravures from 
Original Paintings by the most eminent American 
Artists. List of Illustrations : The Infant, by F. 
S. CHURCH ; The Schoolboy, by WILLIAM ST. 
The Soldier, by GILBERT GAUL ; The Justice, by 
A. B. FROST ; The Lean and Slippered Pantaloon, 
by W. F. SMEDLEY ; Second Childishness, by 
WALTER SHIRLAW. Large 410., elegantly bound, 
bevelled boards, gilt edges ... ... ... ...oro 6 

POPULAR EDITION of the above, Illustrated 
with Woodcuts by the following eminent Engra- 
FRED. JUENGLING. Square pott i6mo., cloth 
elegant, bevelled boards, gilt edges o 5 o 

" The comparison is interesting and instructive throughout, and 
justifies this lengthened notice of two very pretty books." Satur- 
day Review. 

"It is simple justice to say that as a gift -book the volume will 
be prized for its beauty as a production of somewhat ambitious 
designs. " Scotsman. 

' ' Strongly contrast the old and new style of engraving. . , 
The various artists have all been well-chosen." Graphic. 

New and Recent Books. 


Author of " Christianity and the Religions of 
India." Introduction by Sir WILLIAM MuiR, 
K.C.S.L, LL.D., D.C.L., Late Lieut-Governor, 
N.W.P. Eleven Illustrations. Crown 8vo., cloth 060 
"Of what he saw and did he writes agreeebly, without 
obtruding the autobiographical form. . . . The volume is better 
worth reading than others of much higher literary pretensions." 

THE UNKNOWN GOD, and other Sermons. 
Preached in St. Peter's, Vere Street, by the Rev. 
Exhibitioner of Oriel College, Oxford, Author of 
" Seeking for Light.'' Crown 8vo., cloth [Ready 060 


NEWMAN SMYTH, D.D., Author of " Old Faiths 
in New Light," " The Religious Feeling," " The 
Orthodox Theology of To-day." Thirdand cheaper 
Edition. Crown 8 vo., cloth... ... ... ... o 4 6 

"They are fresh and beautiful expositions of those deep 
things, those foundation truths, which underlie Christian faith 
and spiritual life in all their varied manifestations. . . . We 

thank the publisher for bringing out these singularly suggestive 
and instructive discourses in so good a iorm."C/iristian Age. 


Is Christ indeed the Saviour of the World? 

By THOS. ALLIN. Crown 8vo o 5 

" We cannot but accord it a hearty welcome. . . . Care- 
fully and vigorously worked out. . . . We commend Mr. 
Allin's careful and eloquent statement." Church Reformer. 

" Mr. Allin's book will have a welcome from those who desire 
\\ise and simple guidance in their study of this important ques- 
tion." Literary World. 

PAYING THE PASTOR, Unscriptural and 
Traditional. By JAMES BEATY, D.C.L., O.C., 
Member of the Canadian Legislature. Crown 8vo. o 6 

"Is well got,ijp,. and in every respect calculated to repay 
careful perusal. . . . We recommend it as greatly helpful in 
mastering New Testament doctrine on this important and practical 
question. ' 'Ecclesiastical Observer. 

" Skilfully put." Presbyterian. 

Mr. T. Fisher Unwin, 26, Paternoster Square. 

EUPHORION : Studies of the Antique and 
the Mediaeval in the Renaissance. By VERNON 
LEE, Author of " Ottilie," &c. In 2 vols. Demy 
8 vo., cloth extra i i 

" The book is bold, extensive in scope, and replete with well- 
defined and unhackneyed ideas, clear impressions, and vigorous 
and persuasive modes of writing. . . . Large questions have 
been scrutinized in a comprehensive spirit, and are treated with 
both breadth and minuteness, according to the scale of the work. 
This will be apparent from a list of articles in the two volumes. 
After an introduction comes 'The Sacrifice,' 'The Italy of the 
Elizabethan Dramatists,' ' The Outdoor Poetry,' and ' Symmetria 
Prisca.' . . . 'The Portrait Art,' 'The School of Boiardo.' . . . 
lastly comes the longest essay of all, ' Mediaeval Love,' filling 
nearly one hundred pages. This is certainly a masterly per- 
formance, going over a wide field, and showing at every stage 
Abundant discrimination." Athenceum. 

" It is a distinct advance on Vernon Lee's previous work. The 
impressions it records are as vividly individual as ever, the know- 
ledge which informs it is fuller and riper. It deals with a period 
incomparably more interesting than the ' teacup times of hood 
and hoop, ' through whose mazes her first work led us so plea- 
santly ; and it has more unity and continuity than ' Belcaro.' 
Its title is most happily chosen, since the studies all converge 
upon that mystic union of the mediaeval Faust with the Helen of 
antiquity from which the Renaissance sprang." Pall Mall 

" Every page of ' Euphorion ' give evidence of immense read- 
ing in Renaissance and in mediaeval literature, and the author 
possesses the sure instinct so needful in a student of old books, 
which leads her to the passages where intellectual 'booty is to be 
found. . . . Deserves a most cordial welcome as a fresh and 
original contribution to the history of civilization and art; written 
in graceful and often eloquent English." Spectator. 

THE AMAZON : An Art Novel.. By CARL 
VOSMAER. With Preface by Professor GEORGE 
EBERS, and Frontispiece drawn specially by L. 
ALMA TADEMA, R. A. Crown 8vo., cloth o 6 o 

" It is a delineation of inner life by the hand of a master. It 
belongs to the school of Corinne, but is healthier and nobler, and 
in its thought and style fully equal to Madame de Stael's famous 
work. We do not wonder at the European recognition of its 
great merits." British. Quarterly Review. 

" Throughout the book there is a fine air of taste, reminding 
one a little of Longfellow's ' Hyperion.' " The World. 

" It is a work full of deep, suggestive thought. M. Vosmacr, 
in writing it. has added another testimony to his artistic greatness 
ind depth."- Tile Academy. 

New and Recent Books. 

Adventures. Written by himself. With Portrait 
and 14 Illustrations. Fourth and Popular Edition. 
Square Imperial i6mo., cloth extra o 6 o 

"A most fascinating work, full of interesting and curious 
experiences. " Contemporary Review. 

" It is partly an autobiographic sjcetch of character, partly an 
account of a singularly daring and successful adventure in the 
exploration of a practically unknown country. In both aspects 
it deserves to be spoken of as a work of great interest and of 
considerable merit." Saturday Review. 

" This remarkable book is partly an autobiographical sketch 
of character, partly a record of a singularly bold and successful 
attempt to explore a country which at the time when Professor 
Vambery undertook his journey was practically terra incognita. 
. . . Professor Vambery's Autobiography is omnium conscnsu 
a work of very great interest and merit." Life. 

" We can follow M. Vambery's footsteps in Asia with pride 
and pleasure; we welcome every word he has to tell us about the 
ethnography and the languages of the East." Academy. 

"Professor Vambery, of Pest, has just published a book in 
England that tells the story of his life ; a book that forms, under 
every aspect, most agreeable reading. It is not only a deeply 
interesting account of his adventurous career, but it is also 
written in a light and attractive manner, so that the reader's 
attention does not flag for a moment." Die Gegenioart. 

" The character and temperament of the writer come out well 
in his quaint and vigorous style. . . . The expressions, too, in 
English, of modes of thought and reflections cast in a different 
mould from our own gives additional piquancy to the composi- 
tion, and, indeed, almost seems to bring out unexpected capacities 
in the language." Athenaum. 

"There is something in his travels which reminds us of the 
wanderings of Oliver Goldsmith. . . . The English public will 
rind their interest in him increased rather than diminished by this 
graphic account of his life and adventures." British Quarterly 

"Has all the fascination of a lively romance. It is the con- 
fession of an uncommon man ; an intensely clever, extraordinarily 
energetic egotist, well-informed, persuaded that he is in the right 
and impatient of contradiction." Daily Telegraph. 

" The work is written in a most captivating manner, and illus- 
trates the qualities that should be possessed by the explorer.'' 
Novoe Vremya, Moscow. 

" We are glad to see a popular edition of a book, which, how- 
ever it be regarded, must be pronounced unique. The writer, 
the adventures, and the style are all extraordinary the last not 
the least of the three. It is flowing and natural a far better 
style than is written by the majority of English travellers." St. 
James's Gazette. 

** Over Eighty other English and Foreign periodicals have 
reviewed this work. 

Mr. T. Fisher Unwin, 26, Paternoster Square. 

THE EPIC OF KINGS. Stories retold from 
the Persian Poet Firdusi. By HELEN ZIMMERN, 
Author of " Stories in Precious Stones/' "Life of 
Lessing, 1 ' &c. With Etchings by L. ALMA 
TADEMA, R.A., and Prefatory Poem by E. W. 
GOSSE. Popular Edition, Crown 8vo., cloth extra 076 

"Charming from beginning to end. . . . Miss Zimrr.ern 
deserves all credit for her courage in attempting the task, and for 
her marvellous success in carrying it out. . . . Miss Zimmern 
has indeed mastered a pure simple English which fits the anti- 
quity of her subject, and the stories are told in a manner which 
must provoke the envy and admiration of all who have attempted 
this singularly difficult style of composition. " Saturday Revino. 

Also an Edition de luxe, on Dutch Hand-made 
Paper, Super Roy. Quarto, limited to 200 copies. 
Artist's Proofs on Japanese Paper, signed and 
numbered, bound in Parchment extra 3 3 o 

Later Impressions, limited to 300 copies, on 
English Super Roy. 4to., the Etchings on India 
Paper, unsigned, bound in Cloth extra ... ... 2 2 o 

%* A limited number of these editions may still be had. 

GLADYS FANE : The Story of Two Lives. 
By T. WEMYSS REID. Fourth and popular edition. 
In i vol. Crown 8vo., cloth extra o 

" 'Gladys Fane ' is a good and clever book, which few readers 
who begin it are likely to put down unfinished." Saturday 

"The author of the delightful monograph on 'Charlotte 
Bronte ' has given us in these volumes a story as beautiful as life 
and as sad as death. . . . We could not ' wear in our heart's 
core 1 the man who could read aloud with unfaltering voice and 
tindimmed eyes the last pages of this prose story, which is almost 
a poem, and which 

'Dallies with the innocence of love 
Like the old age.' " Standard. 

" Mr.T.Wemyss Reid, the talented editor of the Leeds Mercitn', 
has in ' Gladys Fane ' developed wonderful power as a writer of 
fiction. 'Gladys Fane ' is no ordinary tale; the conventionalities 
of the present-day novel writer are not observed, but Mr. Reid 
gives us what should be the aim of all who produce light literature, 
something novel." Guardian. 

" She is thoroughly original ; her portrait is carefully finished ; 
and it may safely be said that if Mr. Reid has a few more char- 
acters like this in reserve, his success as a novelist is assured. . . . 
I lisa sound piece of work, and, above all, it is very enjoyable 
reading." Academy. 

New and Recent Books. 

SUMMER: From the Journal of HENRY D. 
THOREAU. Edited by H. G. O. BLAKE. With 
an Index. Map. Crown 8vo., cloth, 382 pp. ... o 7 6 
This volume will contain passages selected from Thoreau's 
Journals, comprising his observations and reflections during the 
.summers of many years. Some of these are descriptive, with 
that fine photographic accuracy which marks Thoreau's pictures 
of natural scenes. Other passages contain those subtle reflections 
on society, religion, laws, literature, which also characterize 
whatever Thoreau wrote, and which pique the curiosity and 
stimulate the minds of his readers. The book has a full index. 
Thoreau himself seems to have contemplated a work of this 
kind, for in his Journal he writes of "A book of the seasons, 
each page of which should be written in its own season and out- 
of-doors, or in its own locality, wherever it may be." 

HENRY IRVING : in England and America, 
1838-1884. By FREDERIC DALY. With a Vig- 
nette Portrait, specially etched from a Private 
Photograph taken by S. A. WALKER, by AD. 
LALAUZE ; printed on hand-made paper by M. 
. SALMON, of Paris. Second thousand. Crown 

8vo., cloth extra o 5 o 

"Mr. Frederic Daly has brought together an interesting mass 
of facts which will be acceptable to the admirers of the eminent 
actor. Mr. Daly writes with judicious moderation, and without 
excessive adulation, thoroughly appreciates the deservedly high 
position occupied by the subject of his biography." Athettaum. 

" Mr. Daly is a strong though by no means undiscriminating 
admirer of Mr. Irving. This ensy and well-written narrative gives 
a good idea of the popular actor's career." Contemporary Review. 

' ' Conscientiously full, thoughtfully considered, and gracefully 
written '' Daily Telegraph, 

"It refers succinctly to Mr. Irving's literary efforts, essays, and 
addresses, and concludes with a survey of Mr. Irving's personal 
characteristics. ... An interesting and useful volume. ... A 
portrait of Mr. Irving, etched by M. Lalauze, is admirable in 
execution." Saturday Review. 

"Written with discriminating taste." The World. 

' ' Mr. Daly sets forth his materials with a due sense of propor- 
tion, and writes in a pleasing vein." Daily News. 

SETTLING DAY : A Sketch from Life. By 

SOPHIE ARGENT. Crown 8vo., cloth o 3 6 

' ' A charming story of real life, and one that is as true to 
human nature as it is true to {^^."Cotigregationalht. 

"A pleasant and wholesome little novelette. . . . It is agree- 
ably written." Society. 

Mr. T. Fisher Unwin, 26, Paternoster Square. 


Free Trade in Land. II. Financial Reform. III. 
Monopolies. ( The Cebden Club Prize Essay for 
1883.) By C.' E. TROUP, B.A , Balliol College, 
Oxford. Crown 8vo., cloth o 3 6 

" Lucid in style, and based on a thorough comprehension of 
economic science, the book deserves the attention of all who are 
interested in the questions of which it treats questions which 
are likely to assume prominence in the not-distant future." 

" Leaves no doubt in the reader's mind that Mr. Troup fully 
earned his prize by treating the whole subject in a spirit of dis- 
crimination as well as with undoubted ability." Leeds Mercury. 

ORIENTAL CARPETS: How they are Made 
and Conveyed to Europe. With a Narrative of a 
Journey to the East in Search of Them. By 
HERBERT COXON. Illustrated with Plates and 
Map. Demy 8vo., cloth extra .. o 3 

"We have many new and interesting facts, put in an extremely 
readable form, concerning carpets and the makers and dealers in 
them." Literary World. 

STOPS ; or, How to Punctuate. With Instruc- 
tions for Correcting Proofs, &c. By PAUL 
ALLARDYCE. Third edition. Demy i6mo., 
parchment antique or cloth ... 

" Is a clear and useful little book, which is written with more 
literary skill than is usually shown in such manuals. Mr. Allar- 
dyce will no doubt do more important work." Athenaum, 

"At the end Mr. Allardyce gives the useful example of how to 
correct a proof an art which some of those who live by the pen 
never master thoroughly." Saturday Review. 

" We have hardly any words but those of praise to give to his 
very thoughtful, very dainty little book." Journal of Education. 

"We can conceive no more desirable present to a literary 
aspirant. ' ' A ca demy. 


Practical Hints for all Householders. By 
FREDERICK SNELLING. Demy i6mo., Cloth 
limp ... ... ... ... ... ... ... o o 9 

New and Recent Books. 


1. JOHN WICLIF, Patriot and Reformer: his 

Life and Writings. By RUDOLF BUDDENSIEG, 
Lie. Theol., Leipsic. Parchment covers, Antique 
printing ... ... ... ... ... ... o 2 o 

Paper Covers o i o 

" Mr. Fisher L'mvin has printed in delicious old text, with a 
frontispiece and vellum binding worthy of an old Elzevir, Mr. 
Rudolf Buddensieg's brief extracts from Wiclif 's writings. . . . 
These are full of interest, and the little volume will be useful for 
reference. " Grapkic. 

' ' The matter is equal to the manner, consisting of a summary 
of the career of the great Reformer, drawn up by an acknowledged 
master of the subject, and of a judicious selection of characteristic 
passages from Wiclif 's works. " Sf. James's Gazette. 

' ' No better summary of the conclusions could perhaps be given 
than that which Dr. Buddensieg has epitomized.'' British 
Quarterly Review. 

" A charming book got up in the 'old-style,' bound in parch- 
ment and well printed on thick paper, containing a scholarly and 
appreciative account of Wiclif s life." Nonconformist. 

" Beautifully printed in the old-fashioned manner, and bound 
in imitation of vellum, this book is a thing of beauty. The 
specimens of Wiclif's writings are deeply interesting." Sword 
and Trowel. 


LUTHER. Fcap. I2mo., Antique Paper, Parch- 
ment boards ... ... ... ... ... ... o 2 o 

This is an entirely new selection and translation by Professor 
Gibb, from the ever- popular Tischreden oder Colloquia of " The 
Monk that shook the world," and forms an appropriate souvenir 
of the 4th Centenary now being held throughout Christendom. 

" His words are half-battles." Richter. 

" ' The Table-talk. ' The most interesting now of all the books 
proceeding fiom him.'' Carlyle. 

"Deserves the very highest praise. Great discrimination has 
been shown in the choice of extracts, and considerable skill in the 
grouping of them under appropriate heads." Congregationalist. 

3. DOCTOR JOHNSON: His Life, Works 
and Table Talk. By Dr. MACAULAY, Editor of 

The Leisure Hour o 2 o 

Paper Covers o i o 

This little work will form an interesting souvenir of the great 
lexicographer, as described in its title. The first part will be a 
newly-written life by Dr. Macaulay, and the remaining part of 
the book will be short extracts illustrative of his writings and 

Mr. T. Fisher Unwin, 26, Paternoster Square. 


Darwin, Bain, and Spencer ; or, The Descent of 
Man, Mind, and Body. A Rhyme, with Reasons, 
Esssys, Notes, and Quotations. By "PSYCHOSIS." 
Crown 8vo., cloth extra, 236 pp o 4 6 

" He is a powerful writer. . . . Many of his stanzas are happy 
illustrations of wit md wisdom." Literary World. 

"This is a clever, amusing, and instructive book." 'The 

"This work is highly creditable to the learning and industry of 
its author." Glasg<no Herald. 


Being the Hulsean Lectures for 1882. By F. 
WATSON, M.A., Rector of Starston, and some 
time Fellow of St. John's College, Cambridge. 
Demy 8vo., cloth o 6 o 

"It is worthy of careful and critical review. . . . The book 
will be read with great interest by those who are interested in 
questions that it treats." British Quarterly Review. 

" Mr. Watson's lectures must be awarded unqualified praise. 
The lectures themselves are admirable, and nothing less can be 
s"aid of the subsidiary additions, which are very valuable as con- 
firmatory of the main arguments and theses." Clergyman's 

ment grounded on the Facts of His Life on Earth. 
By JOHN YOUNG, LL.D., Author of " The Life and 
Light of Men," " The Creator and the Creation," 
&c. Seventh and Popular Edition. Crown 8vo., 
cloth o 3 6 

OFF DUTY : Stories of a Parson on Leave. 

By CHARLES WRIGHT. Crown 8vo., cloth o 2 6 

"So genial in its conception, and so modest in its pretentions." 
Christian Million. 

" It is a pleasant miscellany of prose and verse, with sunny 
gleams of humour." Christian Leader. 

"A playful little volume, full of cheery chat, often running 
away from the flats of prose into airy verse with racy anecdote, 
wise suggestion, and sound good sense underlying even its fun." 
Greenock Daily Telegraph. 

" The idea of the book is well conceived and carried out. . . , 
The book is just the one for the sea-side or holiday resort, and 
only needs to be read to be thoroughly enjoyed." Banbury 

New and Recent Books. 


A Record of Mission Work in 





By ROBERT YOUNG, Author of "Modern Missions." 
With an Introduction by the RT. HON. THE EARL 
OF SHAFTE-SBURY, K.G. Illustrated. Crown 8vo., 
cloth extra. Second edition ... ... ...060 

This volume may be considered as a second series of Modern 
Missions (see page 18). It has been issued in response to the 
general demand for a completion of the record of all Protestant 
Missions throughout the world. 

of " The Life of Gladstone,'' &c. Crown 8vo., cloth 
extra, with Steel Portrait 076 

* Including Talleyrand, Sir R. M. Keith, Gondomar, The 
Chevalier D'Eon, Metternich, Harley, Alberoni, and Lord 

"More entertaining than many a sensational novel." Echo. 


after the Original Editions. With Twenty Illus- 
trations, by KAUFFMAN, printed in colours. Fcap. 
4to., cloth extra o 7 6 

" This is irrefutably the edition of 'Robinson Crusoe' of the 
season. It is charmingly got up and illustrated. The type and 
printing are excellent." Standard. 

MOLINOS. Golden Thoughts from "The 
Spiritual Guide" of MIGUEL DE MOLINOS, the 
. Quietist. With a Preface by J. HENRY SHORT- 
HOUSE, Author of "John Inglesant." 136 pp., 
large Fcap. Svo., cloth extra or parchment ... o 2 6 

Readers of "John Inglesant " will be glad to have the oppor- 
tunity of renewing their acquaintance with this Spanish Mystic 
of the Seventeenth Century, through the medium of a careful 
selection and translation of the best things in his " Guide." 

Mr. T. Fisher Unwin, 26, Paternoster Square. 

(The Queen of Roumania). Translated by HELEN 
ZIMMERN, Author of " The Epic of Kings." With 
Portrait-etching by LALAUZE. Square Crown 8vo., 
cloth extra ... ... ... ... ... ... o 5 

' For this nature of literature the Queen appears to have a 
I gift. . . . And never has she been happier than in her 

Leidens Erdengang, which lies before us to-day. The funda- 
mental idea of this cycle of stories is wholly symbolical. . . . 

'ITie next story . . . is a piece of exquisite writing ... It 
is said that for the very charming motherly figure of Patience, 
the Queen's own mother, the wise and good Princess of Wied, 
has furnished the prototype. . . . The last story of the 

cycles, called A Life, changes into an elegiac tone, and depicts 
an existence spent in the search of Truth. Though slightly 
veiled, it is impossible to ignore its autobiographic character. We 
have here the soul of the Queen laid bare before us." Literary* 
World (Review of the German edition). 

"If to write poetry upon a throne be rare of itself, it is. 
certainly still rarer to find Queens giving artistic form to those 
moments of existence that approach the mysteries of human life. 
Already, in her " Sappho," the German poetess, who now occupies- 
a throne, has treated of the relationship of man to the eternal, 
but the antique garb somewhat veiled her purpose, while here (in 
" Pilgrim Sorrow ") she moves amid modern as well as universal 
life, and is thus able to reveal the whole depth of her feeling and 
lament. For what has inspired her poetic phantasy is the ever- 
unanswered question : Wherefore and whence is sorrow in the 
world? The treatment is throughout symbolical. ... It 

deserves to be counted among the modern monuments of our 
literature." Review of the first German edition in the Angsburger 
Allgemeine Zeitung, Nov. 2, 1882. 

OTTILIE: an Eighteenth Century Idyl. By 
VERNON LEE, Author of " Belcaro," " Prince of the 
Hundred Soups," &c. Square 8vo, cloth extra ... o 3 6 

"A graceful little sketch. . . . Drawn with full insight 
into the period described." Spectator. 

" Pleasantly and carefully written. . . . The author lets 
the reader have a glimpse of Germany in the " Sturm und Drang ' 
period. " Athenceum. 

' 'Ottilie von Craussen is a charming character." LeedsMercury. 

"A graceful little picture. . . . Charming all through." 

"Of exquisite literary workmanship; it is full of interest." 
Galignani's Messenger. 

"It is a prose-poem which cannot fail to exercise on most 
readers a refining and purifying influence." Scotsman. 

"To all who relish a simple, natural, and most pathetic story, 
admirably told, we recommend this eighteenth century idyl." 
St. James' Gazette. 

New and Recent Books. 

THE TEMPLE : Sacred Poems and Private 
Ejaculations. By Mr. GEORGE HERBERT. Small 
Crown. New Edition, with Introductory Essay 

This is afac-simile reprint by typography oj 
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paper, size, print, and binding. 

4th Edition, Sheep, imitation of Original Binding 050 
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Imitation Morocco : ... ... ... o 6 o 

' ' This charming reprint has a fresh value added to it by the 
Introductory Essay of the Author of 'John Inglesant.'" 


the Author of " Lays of Modern Oxford. 

Crown 8vo., cloth extra o 6 o 

POEMS AND HYMNS. By the Rev. G. T. 
COSTER, of Whitby. Fcap. 8vo., cloth extra, 
gilt edges o 5 o 

A CUP OF COFFEE. Illustrated. Fcap. 

8vo., boards o i o 

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throughout." Daily Chronicle. 


Prince of Abyssinia. By SAMUEL JOHNSON, LL.D. 
A new edition, small crown 8vo 

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ON THE FIRST PSALM : On the Penitential 
and the Consolatory Psalms. By Sir RICHARD 
BAKER, Knight, Author of " The Chronicle of 
England," &c. c. A verbatim reprint in modern 
spelling. With Introduction by Rev. A. B. GROSART, 
LL.D., F.S.A. Portrait and Autograph. Crown 

Svo., cloth o 6 6 

' ' We have long known the comments of Sir Richard Baker, 
and we have often wondered how they escaped reprinting. . . . 
He turns his text over and over, and sets it in new lights, 
and makes it sparkle and flash in the sunlight after a manner 
little known among the blind critics of the midnight school. 
Deep experience, remarkable shrewdness, and great spirituality 
are combined in Sir Richard. It is hard to quote from him, for 
he is always good alike, and yet he has more memorable 
sentences than almost any other writer. " The Sword and Trowel. 

THOMAS CARLYLE, The Man and His 

Books. Illustrated by Personal Reminiscences, 
Table Talk, and Anecdotes of Himself and his 
Friends. By WM. HOWIE WY LIE. Third edition, 
revised and corrected. Crown 8vo., cloth extra ... o 7 6 

Reviewing the latest volumes on Carlyle, the Spectator of No- 
vember 12, 1881, says: "The best specimen is that by Mr. 
Howie Wylie, previously reviewed in these columns, a work 
which we know to have been read with pleasure by at least one 
svarm and intimate friend of Carlyle, and to which, after perusing 
others of its kin, we return with a somewhat heightened estimate, 
from the point of view of the critic." 

' ' One of the most masterly biographies a bit of work, in- 
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liberality of view, and wealth of friendly insight." Contemporary 


of Thought, Philosophic and Religious. By 

WILLIAM BENTON CLULOW, author of " Essays 

of a Recluse." New and enlarged edition, with 

Portrait and Appendix. Crown 8vo., cloth extra... o 5 o 

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readers will regard ' Sunshine and Shadows ' as great spoil, as a 

companion in rambles, a book to be pencilled in the margin, to 

be taken down at odd moments as a refreshment. Readers who 

love Landor and Hare and Pascal will welcome Mr. Clulow's 

ivork and prize it highly." Bradford Observer. 

New and Recent Books. 

FOOTPRINTS: Nature seen on its Human 
Side. By SARAH TYTLER, Author of "Papers 
for Thoughtful Girls," &c. With 125 Illustrations. 
3rd and cheaper edition. Crown 8vo., cloth extra, 

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MODERN MISSIONS: Their Trials and 
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Missions. It was a happy idea to endeavour to include that 
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Christian people of every Church might read within its four 
hundred pages the tale of what has been done in every 1 nd 
and by all sorts of Christians for the evangelisation of mankind. 
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comprehensive. ' ' Christian World. 


In a Series of Biographical Studies. By A. H. 
JAPP, LL.D. Demy 8vo., cloth o 12 

"This volume, as a whole, is admirable, each chapter being 
characterised by thoroughness, impartiality, fine critical dis- 
cernment, an always manly literary ability, and, above all, a 
moral healthiness of tone. In fact, we are not acquainted with 
any English work, or, for that matter, with any Continental or 
American work, which we could place with so much confidence 
in the hands of a young student of modern German literature as 
the volume under review, and as special proof of our assertion we 
would select the essay on Goethe. . . . For this work we 
must express sincere gratitude to the author." Spectator. 


CONNECTED PARTS A Popular Guide for 
Speakers and Singers. By Dr. J. FARRAR. With 
Thirty-nine Illustrations. Crown 8vo. cloth extra. 036 
" A veiy careful and minute exposition of vocal phenomena. 
Its utility is enhanced by a large number of diagrams." Tht 

" A work that is sure to be found of real practical value." 
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Mr. T. Fisher Unwin, 26, Paternoster Square. 

Crown 8vo., cloth extra ... ... per vol. 036 

1. Leaders of Men. I 3. Master Missionaries. 

2. Wise Words and Loving Deeds. [ 4. Labour and Victory. 

5. Heroic Adventure. 

LEADERS OF MEN: A Book of Biogra- 
phies specially written for Young Men. By H. A. 
PAGE, author of " Golden Lives." Crown 8vo., 
cloth extra, with Portraits. Fourth edition ...0^3 6 
The Prince Consort. | Samuel Greg. 

Commodore Goodenough. 
Robert Dick. 
George Moore. 

Andrew Reed. 
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Lord Lawrence. 

"Mr. Page thoroughly brings out the disinterestedness and 
devotion to high aims which characterise the men of whom he writes 
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"No one knows better than Mr. Page how to put within mode- 
rate compass the outstanding features of a life that has blessed 
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A Book of Biographies for Girls. By E. CONDER 
GRAY. Crown 8vo., cloth extra, w'ith Portraits. 
Fifth edition o 

Mary Somerville. I Madame Feller. 

Lady Duff Gordon. . Baroness Bunsen. 

Sarah Martin. 

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Ann Taylor. Mary Carpenter. 

Charlotte Elliott. | Catherine Tail. 

" A series of brightly-written sketches of lives of remarkable 
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New and Recent Books. 


Heroic Pioneer Work. By ALEXANDER H. JAPP, 
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Crown 8vo. Third edition ... ... ... ... o 3 6 

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" A collection of sketches from the practised pen of Dr. Japp, of 
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graphic and very interesting. " Nonconformist. 

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are many who must have felt the want of just such a handy book 
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"A really excellent and readable book." Literary Churchman 

JAPP, LL.D. Memoirs of Those who Deserved 
Success and Won it. Third edition, Crown 8vo., 
cloth extra o 3 6 

Sir James Outram. 
Thomas Edward. 
Sir James Simpson. 
William Ellis. 

Bishop Selwyn. 
Sir Titus Salt. 
Thos. Davidson. 
Friedrich Augusti 

"There must assuredly be a large number of readers to whom 
these stories of the lives of such men will prove very acceptable. " 

' ' We should be glad to see this volume in the hands of thou- 
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5. HEROIC ADVENTURE: Chapters in 
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Third edition. Crown 8vo., cloth extra o 3 6 

*.*# Containing in a popular form an account of 
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modern times, including Schweinjurth, Prejeval- 
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and Nordenskiold. 

' ' Gives freshness to the old inexhaustible story of enterprise 
and discovery by selecting some of the very latest of heroes in 
this field." Daily News. 

Mr. T. Fisher Unwin, 26, Paternoster Square. 

among our Gipsies and their Children in their 
Tents and Vans. By GEORGE SMITH, of Coal- 
ville, Author of " Gipsy Life," " Canal Adventures 
by Moonlight," &c. With an Appendix showing 
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dren. New and Revised and Popular Edition. 

12 Illustrations o 3 6 

Her Majesty the Queen has been graciously pleased to accept, 
and to thank Mr. Smith for, a copy of the above work. 
' The Kl. Hon. Sir Stafford Northcote, M.P. , thus writes to the 
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" Mr. Smith's sketches of his visits to the gipsies are graphic 
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the perplexing question of their amelioration, to which the author 
has already given yeoman's service." Contemporary Review. 


Wings of the Morning. A Tale of the Renaissance. 
By the Author of " The Spanish Brothers," &c. 
With Illustrations by G. P. JACOMB HOOD. 
Cheaper edition. Imperial 8vo., cloth extra ... o 4 6 

"One of the best stories of the year." British Quarterly 

AMERICAN DISHES, and How to Cook 
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Lady. Crown 8vo., cloth extra o 2 6 

"A smart little tome . . . Fisheries and fish being at present 
in the ascendant, I should recommend all culinary students to 
turn to the section of the lady's book devoted to fish recipes and 
general instructions how to choose and prepare the denizens of 
the deep for the table . . . She is great also in fish-balls . . . 
Consult her pages likewise for baked beans, hominy, potato 
puffs, rye meal, squash biscuits, and minced cabbage. In soups 
she is strong." G. A. S., in Illustrated London News. 

DICK'S HOLIDAYS, and What He Did with 
Them. A Picture Story Book of Country Life. 
By JAMES WESTON. Profusely Illustrated. Im- 
perial 410., Cheaper edition, cloth extra ... ... o 3 6 

' ' This is precisely the book that sensible parents must often 
have been wanting. . . . This delightful book." Academy. 
"A delightful collection." Graphic. 

New and Recent Books. 



With other Mediaeval Tales. By JOHN GIBB. 
With 20 Illustrations. Second and cheaper 
edition. Crown 8vo., cloth extra o 3 6 

"This volume will be certain to charm youthful readers ; and 
a safer or more acceptable gift-book it would be difficult to 
find. . . . Without some such work these precious prototypes of 
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for all youthful readers ; they therefore owe a debt of gratitude 
to him who has translated, condensed, and put them into a popular 
prose form for their perusal." Academy. 


EDWARD GARRETT, Author of " Occupations of 
a Retired Life," &c., &c. With Frontispiece. Third 
and Cheaper edition. Crown 8 vo., cloth extra ... o 3 

"The girls with their Quaker and Moravian training, the 
worthy and benevolent Mrs. Pendlebury, and society generally, 
rich and poor, in Perford, are depicted with skill." Daily News. 

" The picture he gives us here of the Enticknapp household, 
with its Moravian and Quaker traditions, is one nearly perfect of 
its kind for sobriety of taste and freedom from all sentimental 
exaggerations. ' ' Graphic. 


SOUPS : A Puppet Show in Narrative. Edited, 
with a Preface by VERNON LEE, Author of 
" Belcaro," " Studies of the Eighteenth Century in 
Italy," &c. With Four Illustrations in Sepia, by 
SARAH BIRCH. Cheaper edition. Square 8vo., cloth 036 

" There is more humour in the volume than in half-a-dozen 
ordinary pantomimes. " Spectator. 

" The preface is really more interesting than the ' Prince of the 
Hundred Soups,' and that as we hope our readers will find out 
for themselves is saying a good deal." Academy. 

" For myself, I can say that it had upon me the appetising 
effect of that dish in Horace which ' replaced the sated guest upon 
his elbow ; ' for though, when I took it up, I was utterly weary and 
dazed with the number of books I had gone through, yet I 
devoured it from cover to cover with a new zest." Truth, 

Mr. T. Fisher Unwin, 26, Paternoster Square. 

Here and There in the World of Labour. Written 
and Edited by ALEXANDER HAY JAPP, LL.D., 
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" Would make an excellent prize or present-book, especially 
for boys with a taste for miscellaneous information. Anyone, 
however, whose notion of a book is not limited to novels ought 
to be able to read it with pleasure, and can hardly do so without 
profit. ' ' Academy. 

" Dr. Japp travels through a variety of subjects, always 
entertaining and instructive." Spectator. 

'' Nowadays boys are so fed upon story books and books of 
adventure that we welcome a book which tells them something 
about the facts of the world they live in." Graphic. 

PLANT LIFE : Popular Papers on the Pheno- 
mena of Botany. By EDWARD STEP. With 148 
Illustrations drawn by the Author. Third 
edition. Crown 8vo., cloth extra ..036 


" The author has produced a little volume well suited to attract 
the attention and stimulate the curiosity of the student. By 
clothing the dry details of morphological construction with in- 
formation as to the life history of plants, and by calling attention 
to the varied adaptations of form to function, he has followed in 
the wake of that numerous band of naturalists who have at once 
done so much to extend the bounds of botanical science, and to 
make it attractive to the amaleur." Athenceum. 

"More delightful reading for the country at this season of the 
year authors and publishers have not provided for us." Pail 
Mall Gazette. 

"An unpretending book, whose contents cver a very great 
extent of botanical ground. " --Science Gossip. 


WATER COLOURS, 1885. With Facsimiles of 
Sketches by the Artists. Demy Svo. [Just Ready o 

New and Recent Books. 


A MINOR POET : And other Verses. By 
AMY LEVY. Crown 8vo., paper board style, uncut 
edges o 3 6 

"A distinct advance in power on Miss Levy's former verse. 
... It will be hard if her verse does not win many friends by its 
sympathy and tenderness." Cambridge Review. 

' ' Some of her more ambitious pieces remind one of George 
Eliot's poems." St. James's Gazette. 

" Her idea of the character of 'Xantippe' is certainly original, 
and several of her shorter pieces are simple, heartfelt, and har- 
monius." Whitehall Revieiv. 

"Deserves to be singled out from the mass of every-day verse 
for special commendation. The book is very much above the 
average of such productions." Derby Mercury. 


Crown 8vo., cloth o 4 

"He is very happy in his 'Translations from Heine,' fully * 
entering into the poet's humour, and deftly reproducing the half- 
sarcastic, half-pathetic spirit in which Heine so often wrote." 
Whitehall Review. 

" Mr. Radford is himself a poet of no mean ability, and with a 
good deal of Heine in his composition." Sheffield Independent. 

" He has imported into his deeper verse the beauty of a half- 
regretful subtlety and the interest of a real penetration. He can 
think with fineness and record his thoughts with point." 
Frederick Wedmore, in The Academy. 


GWYNNE. Square' Crown 8vo., cloth extra ... o 3 6 

COLLEGE DAYS: Recorded in Blank Verse. 
Printed on Dutch hand-made paper. Fcap. 8vo., 
parchment 050 

A RIVER HOLIDAY. The Lay of a Boat- 
ing Trip, With 17 Illustrations by HARRY 
FuRtflSS. Demy 8vo. ... ... o i o 

This delightful brochure is exquisitively illustrated. "Society. 

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SOLATION : For all in Sorrow or Suffering. 
Compiled and Edited by BENJAMIN ORME, M.A., 
Editor of "The Treasure Book of Devotional 
Reading." Crown 8vo., cloth extra, gilt top ... o 3 6 

TYTLER, Author of " Papers for Thoughtful Girls," 
" Footprints, " &c. Illustrated by M. E. 
EDWARDS. Second Edition. Small Svo., cloth 
extra, gilt edges o 

" Miss Tytler is one of the few writers of modern times who 
know how to write girls' stories. It is impossible for her to be 
dull ; her tales are always sprightly, easy, and clever, and while 
she does not condescend to preach, there are admirable life-lessons 
to be learned in all she writes." Literary World. 


Quarterly Maritime Magazine. Edited by W. 
R. BUCK, Secretary of the Shipwrecked Mariners' 
Society. Illustrated. Published in January, April, 
July, and October ... ... ... ... ... 006 

Yearly Volumes 036 

*-* Adopted by the London School Board. 
For Standard II. In accordance with the require- 
ments of the Revised Code. Beautifully Illustrated. 
Crown 8vo., cloth 009 

" Written in a simple and pleasant style." School Guardian.' 

" The woodcuts, which are to be found on every page, will make 

the lessons pleasant to the scholars, and the text is wisely put 

in a semi-conversational form, calculated to induce intelligent 

reading. "Publisher's Circular. 

New and Recent Books. 


Tale for the Young. By CECILIA LUSHINGTOX, 
Author of " Over the Seas and Far Away." With 
Illustrations by M. E. EDWARDS. Second Edition. 
Small 8vo., cloth extra, gilt edges o 2 6 

other Essays. By H. A. PAGE, Author of " De 
Ouincey," and" Thoreau." Crown Svo., cloth extra o 

' ' We have been much interested in this amusing and instructive 
volume, the first half of which is devoted to "Vers de Societe 
and Parody." ... If published alone this essay itself would 
have deserved to have been placed alongside of the famous 
Rejected Addresses. " Literary World. 


for Young Readers. Sm. Crown 8vo., cloth extra 026 

Gilt edges 030 

" It is the best book of the kind which has passed through our 
hands for some time." Bookseller. 

Short Essays, with Illustrative Proverbs and Anec- 
dotes from many sources. Third edition. Small 
8vo., cloth extra ... -~ ;? - ;..'" o 2 6 

" Profusely illustrated with proverbs and anecdotes, which 
being throughout apt to the injunctions, are likely to act as useful 
memories, when the text of "The Way to Fortune " is not at 
hand." The Inquirer. 

' ' The author is not only a man with a large outlook '.ipon 
human affairs, but with a wide and varied knowledge of English 
literature. Any young man or, for that matter, any young 
woman who will lay the counsels of this book to heart, cannot 
fail to find the way to nobility, fruitfulness, and usefulness of life, 
if not to fortune. We could wish nothing better for this book 
than to see it in the hands of all who set any value on self-help. "- 
Literary World. 

' ' This is not a big book, but it contains no fewer than fifty 
essays. Each is necessarily brief, and yet there is not one that 
does not contain a large amount of wisdom, made more effective 
by the help of illustrative proverbs and anecdotes." Freeman. 

Mr. T. Fisher Unwm, 26, Paternoster Square. 


ISAAC WATTS, D.D. Introduction by THOMAS 
BlNNEY, D.D. Seventh Thousand. 321110, red 
edges, cloth elegant, or in the new wood binding : 
maple, cedar, walnut, and sycamore ... ... o i 

' ' A gem in the way of printing and binding, while the excellence 
of the short practical precepts offered by the writers can hardly 
be over-estimated. " Rock. 

"Just the sort of book for a young man setting out in life. It 
can easily be carried in the waistcoat pocket, and we can conceive 
of no better vade mccum. It is seldom that we meet with so much 
good sense packed into so small a space." Congregationalism 


Verse and Hymn. Gathered by AUNT SARAH and 
COUSIN GRACE. 321110, red edges, cloth elegant, 
or wood : maple, cedar, walnut, or sycamore ... o 

' ' Love for the little ones has clearly been at work in the making 
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pathy." Christian Leader. 

"Its little verses and hymns are selected with fine taste and 
appreciation of children's likings. Externally, the book is a little 
gem.'' Baptist. 

"One of the daintiest of dainty little books for little people. 
The selection of verses is admirable, containing, with some old 
favourites, many that will be fresh to most children." Christian. 


of "Minna's Holiday," &c. Illustrations by Miss 
JOANNA SAMWORTH. Small 8vo., cloth extra... o 


Mrs. MILNE RAE, Author of " Morag," " Hart- 
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WIN MORE & CO. A Tale of the Great Bank 
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New ani Recent Books. 


Guides to Rambles round London. With Maps, 
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sewed ...... ... ... ... ... ... o 9 

Cloth i o 


LONDON : A Guide to Old- World 








DISTRICT, including BARNES, 





7 he last three are in preparation. 

"We could not do better than consult one of these cheap 
Handbooks." Times. 

Those 'Half-Holiday Handbooks' are very useful. But why 

not ' Whole Holiday Pocket Books,' showing where to go, when 
to go.and how to go it? If Mr. Fisher Unwin doesn't look sharp, we 
shall have this series out ourselves about Whitsuntide." Punch. 

' Will be a boon to the weary Londoner, anxious to commune 
with nature." The Inquirer. 

" Capital guides to walks in the districts." Daily Chronicle. 

"A pleasant and convenient series of books for the guidance 
of the pedestrian.'' Literary World. 

" An idea with which we and our fellow-naturalists heartily 
sympathise. The series is one marked by that feeling for nature 
which it is so desirable to extend." H. W., in Bays-Mater 

" The publishers have hit upon a good idea in their Half- 
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favourites." Graphic. 

Mr. T. Fisher Unwin, 26, Paternoster Square. 



containing full directions how to make, stock, and 
maintain Ferneries and Freshwater Aquaria. By 
Illustrations. Crown 8vo., cloth extra ... ... o I o 

Paper Covers... 009 
%* Issued also in two parts, paper covers, 6d. each. 

' ' We cordially recommend it as the best little brochure on ferns 
%ve have yet seen. Its merits far exceed those of much larger and 
more pretentious works." Science Gossip. 

Detect the). By the Author of " Ferns and Fern- 
eries." Numerous Illustrations. Crown 8vo., 
sewed ... ... ... ... ... ... ... o 

"The little work before us offers many useful hints to house- 
holders as to the detection of everyday adulteration." Pall Mall 


FARRAR, F.R.C.P.E. Crown 8vo., limp cloth ... o o 9 

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pages." Literary World. 

GENESIS THE THIRD . History, not 
Fable. Being the Merchants' Lecture for March, 
1883. By EDWARD WHITE. Crown 8vo., Cloth 
extra ... ... ... ... ... ... ... o i o 

Sewed 006 

E. CONDER GRAY, Author of "Wise Words." 
Small 8vo., cloth extra o i o 

" The three tales of which this volume is composed are not 
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them, especially the young, in pure and holy living." Literary 

New and Recent Books. 


taining General Hints to Candidates, Former 
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Practice in Scales and General Problems. By 
C. H. OCTAVIUS CURTIS. Illustrated. Crown 
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By LE COMPTE DE LA HoussAYE, Officier de la 
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and Civil Appointments. Crown 8vo., cloth extra... 026 

cially adapted for Candidates preparing for the 
Preliminary Examination. By R. H. ALLPRESS, 

M.A., Trin. Coll., Camb. Crown 8vo., cloth extra o 2 6 

STEP, Authorof "Plant Life." With 120 Illustrations 
by the Author. Third Edition. Linen covers ... o o 7 
Also in two parts, paper covers, 3d. each. 


" Numerously illustrated, clearly written, with a good deal of 
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' ' The arrangement is good ; the illustrations are very numerous, 
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OF SCHOOLS. Arranged on an entirely new 
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work. In Two Parts, each o I 3 

Or in sections separately. 

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SCHOOLS. Adapted to the Requirements of 
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Mr. T. Fisher Unwin, 26, Paternoster Square. 

BLIND, Author of " Life of George Eliot," 
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LARI, Author of " On Tuscan Hills and Venetian 
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By JANE H. SPETTIGUE, Author of "The Gre- 
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"wo vols. Crown Svo. ... [In Preparation i i 

i> - or 

MAJOR FRANK : A Novel. By A. L. G. 
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vol. Crown 8vo., cloth [Ready 060 

A 000018372 3