vi Morris Ketchum's reply, March 21, 1864, Second letter of Mr. Spaulding to Morris Ketchum, 195 195 Mr. Chase resigns-W. P. Fessenden appointed Secretary Treasury, - 198 Geo. Harrington Secretary of Treasury, ad interim, Gold $2.85%-Gold bill in force only 15 days, Legal tender U. S. notes limited to $400,000,000, All bonds, notes and other obligations exempt from taxation, How Secretary McCulloch paid the Army at close of the War, $830,000,000 of 7-30 Treasury notes issued, Statement of Public Debt at the close of the War, Tariff and Internal Revenue laws, Contraction of the currency, 198 - 198 198-199 Secretary McCulloch on contraction, Mr. Alley's Resolution in favor of contraction, Yeas and nays on Mr. Alley's resolution in the House, Contraction of the currency suspended, Public Faith-Debt to be paid in coin, Yeas and nays on this bill, U, S. Grant approves the bill, Decision of State Courts on the constitutionality of legal tender, - · 208-213 APPENDIX. Mr. Spaulding's Speech on the National Currency Bank bill, February Letter of Mr. Spaulding to Hon. H. R. Hubbard, Comptroller of Mr. Spaulding's letter to Senator Morgan, Letter of Fisk & Hatch to the Assistant Secretary of the Treasury, Secretary McCulloch's letter to L. P. Morton & Co., Mr. Spaulding's remarks, HISTORY OF THE LEGAL TENDER ACT. . The United States, at the breaking out of the rebellion, had no national bank currency, and no gold or available means in the Treasury, or Sub-Treasury, to carry on the war for the Union, and consequently the means to prosecute the war had to be obtained upon the credit of the government, and by taxation. The fundable legal tender currency was the most available form of credit which the government could use in crushing the rebellion. It was at once a loan to the government without interest, and a national currency, which was so much needed for disbursement in small sums during the pressing exigencies of the war. It was indispensably necessary, and a most powerful instrumentality in saving the government and maintaining the national unity. Experience has proved that, notwithstanding it was a forced loan, the end justified the means, and that no parties were materially injured by being compelled to receive this currency, so long as they could fund it at any time in six per cent. twenty years bonds. Although it was a war measure-a measure of necessity and not of choice, and could only be justified on that ground, it has, for many years, exerted a most decisive influence over the property and material interests of every individual in the United States. It has affected debtor and creditor, producer and consumer, and the price of labor and of every article consumed in every household. It still exerts a mighty influence socially, commercially and politically, over the people of this great nation, and all the ramified and extensive business in which they are engaged. Whether for good or evil, it has been and still is a most powerful element in all business affairs of the people, as well as the government, and the war debt of $2,500,000,000 incurred in maintaining the national union is more or less affected by the large volume of this currency still outstanding. Having been requested to prepare a history of a measure of such transcendent importance as the legal tender act, and having in my possession a considerable number of documents, letters, and other materials relating to the subject, I have consented to put them into form, in order that the facts may be preserved for present and future reference, and which may be of some use in enabling the future historian to write a chapter on the financial history of the war. These facts will be presented in the form of a narrative of the circumstances and events, of the most grave and extraor dinary character, occurring in rapid succession, which led finally to the issue of legal tender Treasury notes, and which were endowed with the attributes of money, so far forth as the Government had power under the Constitution and the pressure of the crisis to impart to a paper currency that high and most important attribute of sovereignty. I was a somewhat prominent though humble actor in originating and maturing the measure, but I do not claim any particular merit or demerit for what I did in preparing and aiding to secure the passage of the bill. I was placed in a position where, if I performed my official duty, I must act, and must act with vigor and promptitude. The perilous condition of the country did not admit of hesitancy or delay. I endeavored, in the peculiar and responsible position in which I was placed, to do what I conceived to be my duty, and that is all I claim to have done. My associates performed their duty with equal fidelity and usefulness. As chairman of the Sub-committee of Ways and Means, it became my duty, in connection with my associates, to devise an adequate plan for obtaining the necessary means for prosecuting the war to a successful issue. The rebellion, after the battle of Bull Run, had assumed most gigantic proportions. An Army and Navy of over half a million of men had been hastily brought into the service of the United States. The Capitol itself was guarded by a vast Army, under the command of General McClellan, which encircled it in all directions. The Army and Navy thus in the service had to be paid, fed, clothed and provided with ships, gunboats, monitors and all the necessary material of |