Twenty years of tariff agitation and tinkering had thus ended in general dissatisfaction with the promises and performances of both parties. The Republicans had advanced to a position of high protection based princ.i.p.ally upon the demands of manufacturing interests themselves, modified by such protests on the part of consumers as became vocal and effective in politics. The Democrats had been driven, under Mr.

Cleveland's leadership, to what seemed to be a disposition to reduce the tariff to something approaching a revenue basis, but when it came to an actual performance, their practical views, as manifested in the Wilson-Gorman act, were not far behind those of the opposing party.

Representatives of both parties talked as if the issue was a contest between tariff-for-revenue and protection, but in fact it was not. The question was really, "which of the several regions shall receive the most protection?" Of attempts to get the tariff upon a "scientific basis," striking a balance among all the interests of the country, there was none. Ten years of political warfare over free silver and imperialism were to elapse before there could be a renewed examination of protection as a system.

_The Civil Service Law of 1883_

The "spoils system" of making Federal offices the reward for partisan services began to draw a strong fire of criticism in Grant's first administration. It was natural that the Democrats should view with disfavor a practice which excluded them entirely from serving their country in an official capacity, and the reformers regarded it as a menace to American inst.i.tutions because it was the basis of a "political machine" which controlled primaries and elections and shut out the discussion of real issues. In response to this combined attack, Congress pa.s.sed in 1871 a law authorizing the President to prescribe regulations for admission to the civil service and provide methods for ascertaining the fitness of candidates--a law which promised well while the distinguished champion of reform, George William Curtis, was head of the board in charge of its administration. Congress, however, had accepted the reform reluctantly and refused to give it adequate financial support. After two years' experience with the law, Curtis resigned, and within a short time the whole scheme fell to the ground.

The reformers, however, did not give up hope, for they were sufficiently strong to compel the respect of the Democrats, and the latter, by their insistence on a reform that cost them nothing, forced the Republicans to give the merit system some prominence in their campaign promises.

But practical politicians in both parties had small esteem for a plan that would take away the incentive to work for victory on the part of their followers. It was scornfully called "snivel service" and "goody-goody reform"; and the old practices of distributing offices to henchmen and raising campaign funds by heavy a.s.sessments on officeholders were continued.

Never was the spoils system more odious than when the a.s.sa.s.sination of Garfield by a disappointed office hunter startled the country from its apathy. Within a year, a Senate committee had reported favorably on a civil service reform bill. It declared that the President had to wear his life out giving audiences to throngs of beggars who besieged the executive mansion, and that the spectacle of the chief magistrate of the nation dispensing patronage to "a hungry, clamorous, crowding, and jostling mult.i.tude" was humiliating to the patriotic citizen. And with the Congressman the system "is ever present. When he awakes in the morning it is at his door, and when he retires at night it haunts his chamber. It goes before him, it follows after him, and it meets him on the way." The only relief, concluded the report, was to be found in a thoroughgoing merit system of appointing civil servants.

At length in 1883 Congress pa.s.sed the civil service act authorizing, but not commanding, the President to appoint a commission and extend the merit system to certain Federal offices. The commission was to be composed of three members, not more than two of the same party, appointed by the President and Senate, and was charged with the duty of aiding the President, at his request, in preparing suitable rules for compet.i.tive examinations designed to test the fitness of applicants for offices in the public service, already cla.s.sified or to be cla.s.sified by executive order or by further legislation. The act itself brought a few offices under the merit system, but it left the extension of the principle largely to the discretion of the President. When the law went into force, it applied only to about 14,000 positions, but it was steadily extended, particularly by retiring Presidents anxious to secure the jobs already held by their partisans or to improve the efficiency of the service. Neither Cleveland nor Harrison enforced the law to the satisfaction of the reformers, for the pressure of the office seekers, particularly under Cleveland's first administration, was almost irresistible.

_Railway and Trust Regulation_

In the beginning of the railway era in the United States, Congress made no attempt to devise a far-sighted plan of public control, but negligently devoted its attention to granting generous favors to railways. It was not until the stock-watering, high-financing, discriminations and rebates had disgraced the country that Congress was moved to act. It is true that President Grant in his message of 1872 recommended, and a Senate committee approved, a comprehensive plan for regulating railways, but there was no practical outcome. The railway interests were too strong in Congress to permit the enactment of any drastic regulatory laws. But at length the Granger movement, which had produced during the seventies so much railway regulation in the States,[30] appeared in Congress, and stirred by a long report by a Senate committee enumerating a terrifying list of abuses against shippers particularly, Congress pa.s.sed, in 1887, the first important interstate commerce law.

This act was a timid, halting measure, and the Supreme Court almost immediately sheared away its effectiveness by decisions in favor of the railway companies. The law created a commission of five members empowered to investigate the operations of common carriers and order those who violated the law to desist. The act itself forbade discriminations in rates, pooling traffic, and the charging of more for "short" than "long hauls" over the same line, except under special circ.u.mstances. In spite of the good intentions of the commission, the law was practically a dead letter. According to a careful scholar, Professor Davis R. Dewey, "By 1890 the practice of cut rates to favored shippers and cities was all but universal at the West; pa.s.ses were generally issued; rebates were charged up to maintenance of way account; special privileges of yardage, loading, and cartage were granted; freight was underbilled or carried under a wrong cla.s.sification and secret notification of intended reduction of rates was made to favored shippers.... The ingenuity of officials in breaking the spirit of the law knew no limit, and is a discouraging commentary on the dishonesty which had penetrated into the heart of business enterprise."[31]

The critics of railway policy who were able to force the pa.s.sage of the interstate commerce act usually coupled the denunciation of the industrial monopolies with their attacks on common carriers; and, three years after the establishment of the interstate commerce commission, Congress, feeling that some kind of action was demanded by the political situation, pa.s.sed the Sherman anti-trust law of 1890. There was no consensus of opinion among the political leaders as to the significance of the trust. Blaine declared that "trusts were largely a private affair with which neither the President nor any private citizen had any particular right to interfere." Speaker Reed dismissed the subject by announcing that he had heard "more idiotic raving, more pestiferous rant, on that subject than on all others put together." Judge Cooley, on seeing "the utterly heartless manner in which the trusts sometimes have closed many factories and turned men willing to be industrious into the streets in order that they may increase profits already reasonably large," asked whether the trust "as we see it is not a public enemy; whether it is not teaching the laborer dangerous lessons; whether it is not helping to breed anarchy."

In the midst of this general confusion of opinion on the trust, it is not surprising that Congress in the Sherman law of 1890 enunciated no clear principles. Apparently it intended to restore compet.i.tion by declaring illegal "every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several states or with foreign nations." But a study of the debates over the law fails to show any consistent opinion as to what combinations were included within the prohibition or as to the exact meaning of "restraint of trade." Of course, the lawyers pointed at once to the simplicity of the old common law doctrine that conspiracies in restraint of trade are illegal, but this was an answer in verbiage which gave no real clew to concrete forms of restraint under the complex conditions of modern life.

The vagueness of the Sherman anti-trust law was a subject of remark during its pa.s.sage through Congress. O. H. Platt, in the Senate, criticized the bill as attacking all combinations, no matter what their practices or forms. "I believe," he said, "that every man in business--I do not care whether he is a farmer, a laborer, a miner, a sailor, manufacturer, a merchant--has a right, a legal and a moral right, to obtain a fair profit upon his business and his work; and if he is driven by fierce compet.i.tion to a spot where his business is unremunerative, I believe it is his right to combine for the purpose of raising prices until they shall be fair and remunerative. This bill makes no distinction. It says that every combination which has the effect in any way to advance prices is illegal and void.... The theory of this bill is that prices must never be advanced by two or more persons, no matter how ruinously low they may be. That theory I denounce as utterly untenable, as immoral."

Senator Platt then went on to say that the whole subject had not been adequately considered and that the bill was a piece of politics, not of statesmanship. "I am sorry, Mr. President," he continued, "that we have not had a bill which had been carefully prepared, which had been thoughtfully prepared, which had been honestly prepared, to meet the object which we all desire to meet. The conduct of the Senate for the past three days--and I make no personal allusions--has not been in the line of the honest preparation of a bill to prohibit and punish trusts.

It has been in the line of getting some bill with that t.i.tle that we might go to the country with. The questions of whether the bill would be operative, of how it would operate, or whether it was within the power of Congress to enact it, have been whistled down the wind in this Senate as idle talk, and the whole effort has been to get some bill headed: 'A Bill to Punish Trusts,' with which to go to the country."

Senator h.o.a.r, who claimed that he was the author of the Sherman anti-trust law, says, however, that the act was not directed against _all_ combinations in business. "It was expected," he says, "that the court in administering that law would confine its operations to cases which are contrary to the policy of the law, treating the words 'agreements in restraint of trade' as having a technical meaning, such as they are supposed to have in England. The Supreme Court of the United States went in this particular farther than was expected.[32] ... It has not been carried to its full extent since, and I think will never be held to prohibit those lawful and harmless combinations which have been permitted in this country and in England without complaint, like contracts of partnership, which are usually considered harmless."

The immediate effects of the Sherman anti-trust law were wholly negligible. Seven of the eight judicial decisions under the law during Harrison's administration were against the government, and no indictment of offenders against the law went so far as a trial. During Cleveland's second term the law was a dead letter. Meanwhile trusts and combinations continued to multiply.

_The Income Tax Law of 1894_

In the debates over tariff reduction, silver, and paper money, evidences of group and cla.s.s conflicts were almost constantly apparent, but it was not until the enactment of the income tax provision of 1894 that political leaders of national standing frankly avowed a cla.s.s purpose--the shifting of a portion of the burden of national taxes from the commodities consumed by the poor to the incomes of the rich.

The movement for an income tax found its support especially among the farmers of the West and South and the working cla.s.ses of the great cities. The demand for it had been appearing for some time in the platforms of the agrarian and labor parties. The National or Greenback party, in its platform of 1884, demanded "a graduated income tax" and "a wise revision of the tariff laws with a view to raising revenues from luxury rather than necessity." The Anti-monopoly party, in the same year, demanded, "a graduated income tax and a tariff, which is a tax upon the people, that shall be so levied as to bear as lightly as possible upon necessaries. We denounce the present tariff as being largely in the interest of monopolies and demand that it be speedily and radically reformed in the interest of labor instead of capital." The Union Labor convention at Cincinnati in 1888 declared in its platform: "A graduated income tax is the most equitable system of taxation, placing the burden of government upon those who can best afford to pay, instead of laying it upon the farmers and producers and exempting millionaire bondholders and corporations."

In the campaign of 1892, the demand for an income tax was made by the Populist party and by the Socialist Labor party. The former frankly declared war on the rich, proclaiming in its platform that, "The fruits of the toil of millions are boldly stolen to build up colossal fortunes for a few, unprecedented in the history of mankind; and the possessors of these, in turn, despise the republic and endanger liberty." Among the remedies for this dire condition of things the Populists demanded "a graduated income tax." The Democrats, at their convention of that year, denounced the McKinley tariff law "as the culminating atrocity of cla.s.s legislation," and declared that "The Federal government has no const.i.tutional power to impose and collect tariff duties except for the purpose of revenue only."

When it was discovered in the ensuing election that the Democratic party, with its low tariff p.r.o.nunciamento was victorious, and that the Populists with their radical platform had carried four western states and polled more than a million votes, shrewd political observers saw that some revision in the revenue system of the Federal government was imperative. President Cleveland, in his message of December, 1893, in connection with the recommendation for a revision of the tariff, stated that, "the committee ... have wisely embraced in their plans a few additional revenue taxes, including a small tax upon incomes derived from certain corporate investments." It is not clear what committee the President had in mind, and Senator Hill declared that the Ways and Means Committee had not agreed "upon any income tax or other internal taxation"; although it had undoubtedly been considering the subject in connection with the revision of the tariff.

When the tariff bill was introduced in Congress, on December 19, 1893, it contained no provision for an income tax, and it was not until January 29 that an income tax amendment to the Wilson bill was introduced in behalf of the Committee. In defending his amendment, the mover, Mr. McMillin, declared that the purpose of the tax was to place a small per cent of the enormous Federal burden "upon the acc.u.mulated wealth of the country instead of placing all upon the consumption of the people." He announced that they did not come there in any spirit of antagonism to wealth, that they did not intend to put an undue embargo upon wealth, but that they did intend to make acc.u.mulated wealth pay some share of the expenses of the government. The tariff, in his opinion, taxed want, not wealth. He was impatient with the hue and cry that was raised, "when it is proposed to shift this burden from those who cannot bear it to those who can; to divide it between consumption and wealth; to shift it from the laborer who has nothing but his power to toil and sweat to the man who has a fortune made or inherited." The protective tariff, he added, had made colossal fortunes by levying tribute upon the many for the enrichment of the few; and yet the advocates of an income tax were told that this acc.u.mulated wealth was a sacred thing which should go untaxed forever. In announcing this determination to tax the rich, Mr. McMillin disclaimed any intention of waging a cla.s.s war, by declaring that the income tax, in his opinion, would "diminish the antipathy that now exists between the cla.s.ses," and sweep away the ground for that "iconoclastic complaint which finds expression in violence and threatens the very foundations upon which our whole inst.i.tution rests."

The champions of property against this proposal to tax incomes in order to relieve the burden upon consumption summoned every device of oratory and argument to their aid. They ridiculed and denounced, and endeavored to conjure up before Congress horrible visions of want, anarchy, socialism, ruin, and destruction. J. H. Walker, of Ma.s.sachusetts, declared that, "The income tax takes from the wealth of the thrifty and the enterprising and gives to the shifty and the sluggard." Adams, of Pennsylvania, found the income tax "utterly distasteful in its moral and political aspects, a piece of cla.s.s legislation, a tax upon the thrifty, and a reward to dishonesty." In the Senate, where there is supposed to be more sobriety, the execrations heaped upon the income tax proposal were marked by even more virulence. Senator Hill declared that, "The professors with their books, the socialists with their schemes, the anarchists with their bombs, are instructing the people of the United States in the organization of society, the doctrines of democracy, and the principles of taxation. No wonder if their preaching can find ears in the White House." In his opinion, also, the income tax was an "insidious and deadly a.s.sault upon state rights, state powers, and state independence." Senator Sherman particularly objected to the high exemption, declaring, "In a republic like ours, where all men are equal, this attempt to array the rich against the poor, or the poor against the rich, is socialism, communism, devilism."

In spite of this vigorous opposition, the House pa.s.sed the provision by a vote of 204 to 140 and the Senate by a vote of 39 to 34. In its final form the law imposed a tax of two per cent on all incomes above $4000--an exemption under which the farmer and the lower middle cla.s.s escaped almost entirely. Cleveland did not like a general income tax, and he was dissatisfied with the Wilson tariff bill to which the tax measure was attached. He, therefore, allowed it to go into effect without his signature.

_Labor Legislation_

The only measures directly in the interests of labor generally pa.s.sed during this period were the Chinese exclusion act, the law creating a labor bureau at Washington, and the prohibition of the importation of alien workingmen under contract. Shortly after the Civil War, protests were heard against cheap Chinese labor, not only in the western states, but also in the East, where manufacturers were beginning to employ coolies to break strikes and crush unions. At length, early in 1882, Congress pa.s.sed a measure excluding Chinese laborers for a period of twenty years, the Republicans from the eastern districts voting generally against it. President Arthur vetoed the bill, holding in particular that it was a violation of treaty provisions with China, and suggested a limitation of the application of the principle to ten years.

This was accepted by Congress, and the law went into force in August of that year. More stringent identification methods were later applied to returning Chinese, and in 1892, the application of the principle of exclusion was further extended for a term of ten years. In 1884, a Federal bureau of labor statistics was created to collect information upon problems of labor and capital. In 1885, Congress pa.s.sed a law prohibiting the importation of laborers under contract, which was supplemented by later legislation.[33]

FOOTNOTES:

[28] See below, p. 123.

[29] The Silver Democrats declared that this demonetization was secretly brought about by a "conspiracy" on the part of gold advocates, and named the act in question "the crime of '73."

[30] See above, p. 167.

[31] _National Problems_, p. 103.

[32] See below, p. 332.

[33] In 1887, Congress enacted a law providing for counting the electoral vote in presidential elections. This measure grew out of the disputed election of 1876.

CHAPTER VI

THE GROWTH OF DISSENT

Important as was the legislation described in the preceding chapter, there were sources of discontent which it could not, in the nature of things, dry up. With the exception of the income tax, there had been no decisive effort to placate the poorer sections of the population by distinct cla.s.s legislation. It is true, the alien contract labor law and the Chinese exclusion act were directed particularly to the working cla.s.s, but their effects were not widely felt.

The acc.u.mulation of vast fortunes, many of which were gained either by fraudulent manipulations, or shady transactions within the limits of the law but condemned by elementary morals, and the ma.s.sing of millions of the proletariat in the great industrial cities were bound in the long run to bring forth political cleavages as deep as the corresponding social cleavage. The domination of the Federal government by the captains of machinery and capital was destined to draw out a counter movement on the part of the small farmers, the middle cla.s.s, and the laborers. Mutterings of this protest were heard in the seventies; it broke forth in the Populist and Socialist movement in the nineties; it was voiced in the Democratic campaign of 1896; silenced awhile by a wave of imperialism, it began to work a transformation in all parties at the opening of the new century.

This protest found its political expression in the organization of "third" or minor parties. The oldest and most persistent of all these groups is the Prohibitionist party, which held its first national convention at Columbus, Ohio, in 1872, and nominated Mr. Black, of Pennsylvania, as its candidate. In its platform, it declared the suppression of the liquor traffic to be the leading issue, but it also proposed certain currency reforms and the regulation of transportation companies and monopolies.

Although their popular vote in 1872 was less than six thousand, the Prohibitionists returned to their issue at each succeeding campaign with Spartan firmness, but their gains were painfully slow. They reached 9522 in 1876, and 10,305 in 1880. In the campaign of 1884, when many Republicans were dissatisfied with the nomination of Blaine, and unwilling to follow Curtis and Schurz into the Democratic camp, the Prohibition vote rose to 150,369. A further gain of nearly one hundred thousand votes in the next election, to which a slight addition was made in 1892, encouraged the Prohibitionists to hope that the longed-for "split" had come, and they frightened the Republican politicians into considering concessions, especially in the states where the temperance party held the balance of power. In fact, in their platform of 1892 the Republicans announced in a noncommittal fashion that they sympathized with "all wise and legitimate efforts to lessen and prevent the evils of intemperance and promote morality." The scare was unwarranted, however, for the Prohibition party had about reached its high-water mark. Being founded princ.i.p.ally on one moral issue and making no appeal to any fundamental economic divisions, it could not make headway against the more significant social issues, and its strength was further reduced by the growth of state and local prohibition.

Almost immediately after the Civil War, labor entered politics in a small way on its own account. In 1872, a party known as the "Labor Reformers" held a national convention at Columbus which was attended by delegates from seventeen states. It declared in favor of restricting the sale of public lands to homesteaders, Chinese exclusion, an eight-hour day in government employments, civil service reform, one term for each President, regulation of railway and telegraph rates, and the subjection of the military to the civil authorities. The party nominated Justice Davis, who had been appointed to the Supreme Court of the United States by Lincoln and had shown Populist leanings immediately after the War; but Mr. Davis declined to serve, and O'Connor of New York, to whom the place was then tendered, only polled about 29,000 votes.

This early labor party was simply a party of mild protest. It originated in Ma.s.sachusetts, where there had been a number of serious labor disputes and a certain shoe manufacturer had imported a carload of Chinese to operate his machinery. Although Wendell Phillips, who had declared the emanc.i.p.ation of labor to be the next great issue after the emanc.i.p.ation of slaves, was prominently identified with it and stood next to Justice Davis on the first poll in the convention, the party as a whole manifested no tendency to open a distinct cla.s.s struggle, and the leading planks of its program were shortly accepted by both of the old parties.

Standing upon such a temporary platform, and unsupported by any general philosophy of politics, the labor reform party inevitably went to pieces. Its dissolution was facilitated by the rise of an agrarian party, the Greenbackers, who, in their platform of 1880, were more specific and even more extensive in their declaration of labor's rights than the "Reformers" themselves had been. It was not until 1888 that another "labor" group appeared, but since that date there has been one or more parties making a distinct appeal to the working cla.s.s. In that year, there were two "labor" factions, the Union Labor party and the United Labor party. Both groups came out for the public ownership of the means of transportation and communication and a code of enlightened labor legislation. The former advocated the limitation of land ownership and the latter the application of the single tax. Both agreed in denouncing the "Democratic and Republican parties as hopelessly and shamelessly corrupt, and, by reason of their affiliation with monopolies, equally unworthy of the suffrages of those who do not live upon public plunder." The vote of both groups in the ensuing election was slightly over 150,000.

The labor groups which had broken with the old parties took a more definite step toward socialism in 1892, when they frankly a.s.sumed the name of the Socialist Labor party[34] and put forward a declaration in favor of the public ownership of utilities and a general system of protective labor legislation. Although the socialism of Karl Marx had by this time won a wide influence among the working cla.s.ses of Europe, there are few if any traces of it in the Socialist Labor platform of 1892. That platform says nothing about the inevitable contest between labor and capitalism, or about the complete public ownership of all the means of transportation and production. On the contrary, it confines its statements to concrete propositions, including the political reforms of the initiative, referendum, and recall, all of which have since been advocated by leaders in the old parties. The small vote received in 1892 by the socialistic candidate, 21,532, is no evidence of the strength of the labor protest, for the Populist party in that year included in its program substantially the same principles and made a distinct appeal to the working cla.s.s, as well as to the farmers.