"August Belmont & Co., New York.

"Drexel, Morgan & Co., New York.

"J. & W. Seligman & Co., New York.

"Morton, Bliss & Co., New York.

"First National Bank, New York.

"Drexel & Co., Philadelphia.

"June 16, 1877."

A few days later I wrote the following letter:

"Treasury Department, } "Washington, D. C., June 19, 1877.} "Sir:--Your letter of the 18th instant, in which you inquire whether the four per cent. bonds now being sold by the government are payable, princ.i.p.al and interest, in gold coin, is received. The subject, from its great importance, has demanded and received careful consideration.

"Under laws now in force, there is no coin issued or issuable in which the princ.i.p.al of the four per cent. bonds is redeemable, or the interest payable, except the gold coins of the United States of the standard value fixed by laws in force on the 14th of July, 1870, when the bonds were authorized.

"The government exacts, in exchange for these bonds, payment at par in such gold coin, and it is not to be antic.i.p.ated that any future legislation of Congress, or any action of any department of the government, would sanction or tolerate the redemption of the princ.i.p.al of these bonds, or the payment of the interest thereon, in coin, of less value than the coin authorized by law at the time of the issue of the bonds, being the coin exacted by the government in exchange for the same.

"The essential element of _good faith_, in preserving the equality in value between the coinage in which the government receives and that in which it pays these bonds, will be sacredly observed by the government and the people of the United States, whatever may be the system of coinage which the general policy of the nation may at any time adopt.

"This principle is impressed upon the text of the law of July 14, 1870, under which the four per cent. bonds are issued, and requires, in the opinion of the executive department of the government, the redemption of these bonds and the payment of their interest in coin of equal value with that which the government receives from its issue.

"Very respectfully, "John Sherman, Secretary.

"Francis O. French, Esq., 94 Broadway, New York."

The subscriptions were taken in every part of the United States, and within thirty days $67,600,000 were taken in this country and $10,200,000 in Europe, making $77,800,000 sold. This sum, when applied to the payment of the six per cent. bonds, made an annual saving to the people of the United States of $1,556,000. Since the 1st of March, 1877, there had been sold under the refunding act $135,000,000 four and a half per cent. bonds and that amount of six per cent. bonds was paid off and canceled, thus saving to the people of the United States $2,025,000 in coin each year. The aggregate reduction of interest by both cla.s.ses of bonds from the 1st of March to the close of the popular loan, was $3,581,000 a year in coin. This was regarded as a great success.

Early in July I set out on the revenue cutter "U. S. Grant" on a visit of inspection along the north Atlantic coast, accompanied by the chief of the coast survey, the secretary of the lighthouse board, the superintendent of the life-saving service, and the chief of the revenue marine service, and also by Webb Hayes, the son of the President. We visited the life-saving stations along the New Jersey coast. I was deeply interested in this service, which I regard as the most deserving humanitarian branch of the public service. We also visited some of the leading lighthouses along the coast and the princ.i.p.al customhouses between the Chesapeake Bay and Eastport, Maine. We were everywhere received with great kindness and many social courtesies were extended to us, especially in New York, Boston and Portland. This outing was a great relief from the close confinement I had undergone since the 4th of March.

The information I gathered as to these branches of the service, with which I had not previously had much acquaintance, was of great value to me. Such trips are sometimes treated by the press as "junketing" at the public expense. This is a great error. Each of us paid his share of the expenses and the vessel only pursued its usual course of duty. I was brought into close a.s.sociation with these subordinate officers of the department and became informed of their duties, and their fitness for them, and was enabled to act with intelligence on their recommendations.

The only unpleasant incident that occurred on the trip was the running of the cutter upon a rock upon the coast of Maine. This happened in the afternoon of a beautiful day. All the gentlemen with me and the officers of the vessel were on deck. The various buoys were being pointed out and a map of the channel was lying before us. Some mention was made of a buoy that ought to be near the place where we were to mark the location of a rock, but none was found, and suddenly we heard the sc.r.a.ping of the vessel upon the rock. The cutter trembled and careened over. The captain was somewhat alarmed and turned the vessel toward the beach, where it was speedily examined and found to be somewhat injured. We ascertained afterwards that the buoy had been displaced by a storm and that a vessel was then on its way to replace it. The sinking of the revenue cutter "U. S. Grant" was reported in the morning dispatches and created some excitement; but the vessel did not sustain any substantial injury. We thought it best to leave it for a time to be thoroughly examined and repaired and took another vessel to complete our journey to Eastport, the northeastern port of the United States. From thence Webb Hayes and myself returned to Portland and crossed over the Burlington, Vermont, on Lake Champlain, and from thence went to Saratoga, where we remained a few days, and then returned to Washington on the 22nd of July. We pa.s.sed through Baltimore on the day the riots occurred in that city, and soon after heard of the much more dangerous outbreak in Pittsburg.

On the 6th of August I wrote to Mr. Conant as follows:

"Your letter of the 26th ultimo is received. You can safely say to the Messrs. Rothschild that the strikes have been totally disconnected with the government, but grow purely out of a contract between the managers of the leading lines of railway and their employees as to rates of pay.

"The railroad companies have, for several years, competed with each other in a very improvident and reckless way, and are now, and have been for some time, carrying freight for less than cost. This has caused a large reduction of the net income of roads, has led to the loss of dividends, and now to the reduction of wages of employees to rates scarcely sufficient to support life. Hence the strikes.

"The government has been appealed to by both railroads and strikers, by states and by cities, for relief, and has promptly extended it in every proper case, and, without shedding blood, has, in every case, suppressed the riot, and maintained the peace, so that the government is really stronger by reason of these unfortunate events than before. I do not observe that any change has been made by them, either in the price of bonds or in the price of gold, nor in the payment of subscriptions to four per cent. bonds.

"No effort is made to sell the bonds now, nor do I care to press the home market, until enough bonds are sold abroad to provide for called bonds abroad.

"The month of August must necessarily be a languid one, and I do not advise any unusual efforts to force sales.

"Your supplemental cipher was received after your telegram, but was soon found and dispatch made out."

I no doubt was mistaken in the effect of the strikes upon our public credit. From that time forward for many months there was scarcely any sale of government bonds at any price. The contracting parties informed me that no bonds were then selling in the market and that in New York they were a trifle below par. Practically, for the remainder of the year, government securities were greatly affected in price and value.

CHAPTER x.x.x.

POLICY OF THE HAYES ADMINISTRATION.

Reception at my Home in Mansfield--Given by Friends Irrespective of Party--Introduced by My Old Friend and Partner, Henry C. Hedges --I Reply by Giving a Resume of the Contests in South Carolina and Louisiana to Decide Who Was Governor--Positions Taken by Presidents Grant and Hayes in These Contests--My Plans to Secure the Resumption of Specie Payments--Effects of a Depreciated Currency--Duties of the Secretary of the Treasury--Two Modes of Resuming--My Mansfield Speech Printed Throughout the Country and in England--Letters to Stanley Matthews and General Robinson--Our Defeat in Ohio--An Extra Session of Congress--Bills Introduced to Repeal the Act Providing for the Resumption of Specie Payments--They All Fail of Pa.s.sage-- Popular Subscription of Bonds All Paid For.

About the 10th of August I made my usual visit to my home at Mansfield. Soon after my arrival I received the following invitation, signed by a great number of my neighbors and friends, without respect to party, expressing a desire to tender me a reception:

"Hon. John Sherman.

"Dear Sir:--The undersigned, your townsmen, and fellow-citizens of Richland county, desire to give you some manifestation of the very high regard in which we hold your public services. We are glad to know that you are permitted to again be at your own home, and for a week or two mingle with us in all the unrestrained freedom of friends and townsmen.

"Financial and other public questions are, however, of importance to us always, and especially now. We recognize your great ability and long experience, and cannot but think that an expression of your views on these questions will be very highly prized by the people of Ohio, irrespective of party. We therefore desire, with your sanction, on some day during the next week, to give you a hearty welcome to your old home, and shall be glad to have you, on the occasion, give your views on the public questions, now of such vast importance to all. With our kindest regards, we are,

"Your friends, etc., etc."

I replied as follows:

"Mansfield, O., August 13, 1877.

"Gentlemen:--I received with much pleasure your kindly letter of the 10th inst., signed by so many of my old friends and neighbors of Mansfield, and a.s.sure you of my high appreciation of your generous words of courtesy and regard.

"I always return with satisfaction to my home on the western slope of our little city, and always enjoy the fresh air and picturesque country around us, but, more than all, the cordial greetings of old friends, with whom I have been acquainted since boyhood. It will give me much pleasure, at any time or place, to meet you, and to speak to you on current public questions, and I venture to name next Friday evening.

"Very truly yours, "John Sherman."

The gathering was one of the largest that had come together in Mansfield for years. The evening was delightful, cool and balmy, a bright moonlight adding attraction to the scene. A stand decorated with flags had been erected near the center of the park, with seats in front, and lights gleamed on either hand. I was introduced to the audience by my old friend and partner, Henry C. Hedges, whose remarks were too flattering for me to insert. In closing he said:

"Regarding you as our friend, our neighbor, our townsman, we are glad and rejoice. We welcome you home, though your stay may be only a few days, and we sincerely trust that, rested by your stay, you may go back to your work reinvigorated, and that frequently we may have the pleasure of your temporary visits, and in the future, when your labors are finished, among us you may spend your old age, honored and happy."

As my speech expressed my views upon important questions of that time, I think it well to embody extracts from it as part of the history of the then recent events, and my antic.i.p.ations for the future:

"The kindly words of welcome uttered by my friend and a.s.sociate of many years move me beyond expression. They recall to me the scene of the early time when I came to Mansfield, then a scattered hamlet of about 1,100 inhabitants, without pavements and without any of the modern conveniences of cities and towns. As Mr. Hedges has told you, very many of those I then met here are dead and gone.

I was a boy then. A generation has pa.s.sed away, and the sons of those I met then as citizens of Richland county now fill places of trust and responsibility. I have every reason in the world for being strongly attached to this town of Mansfield. You have always been kind to me. Here I studied law, here I practiced my profession for several years, here I married my wife, a native of your town, here I have lived ever since, and when this mortal coil shall be shuffled off, here, probably, will my body rest with your fathers.

But pardon me, fellow-citizens, if, under the kinds words of welcome of your spokesman, my old and honored friends, Mr. Hedges, I had forgotten that we are not here merely to exchange courtesies, but to discuss grave matters of far more importance than the life or memories of an individual.

"In doing so I wish it distinctly understood that I speak for myself alone, as a citizen of Ohio, to you my fellow-citizens and my neighbors, to whom I am under the highest obligations of grat.i.tude and duty.

"The President authorized me to say one thing, and one thing only, for him, and in his name, and that is that all reports that impute to him any partic.i.p.ation whatever in the nomination of candidates on your state ticket, or any desire or purpose to influence in any way the senatorial contest in Ohio, are utterly groundless.

"These are your matters, and I can a.s.sure you for him, that he does not and will not, interpose in any such contest between political friends.

"You all know that I am now, and have been, warmly attached to the Republican party. I believe in its principles and honor its work.

With my strong convictions I could not conceal my partisan bias, or my earnest hope for the success of the Republican party, but the subjects of which I intend to speak to you to-night will not lead me to say much of former political struggles, or to fight our old battles over again, but chiefly to discuss the actual administrative questions of the day as they have arisen since the 4th of March last, and in all of which you are alike interested, whether you may call yourselves Republicans or Democrats. As to those questions I wish fairly to appeal to the candor and good judgment of honest men of both parties, only asking for the administration of President Hayes that considerate charity of judgment which must be extended to all human agents.

"When Mr. Hayes was inaugurated as President he found thirty-six states in the full and uncontested exercise of all the powers of states in the Union. In two states only there were contests as to who was governor. Both contests had existed from January to March, 1877, while General Grant was President.

"In South Carolina Governor Chamberlain claimed to have been elected on the Republican ticket, and General Hampton on the Democratic ticket. The President is not made the judge of who is elected governor of a state, and an attempt to exercise such a power would be a plain act of usurpation. The const.i.tution of South Carolina is much like that of Ohio. The count of the vote was to be made by the general a.s.sembly of the state. Unfortunately for Chamberlain a controlling question in the contest had been decided against him by a Republican court, and he was only kept in possession of the state house by the actual presence of United States troops in the building. He had appealed again and again to President Grant to recognize him as governor and give him the aid of Federal troops in the enforcement of his claim, which General Grant had refused, seeking only to preserve the public peace.

"When President Hayes was inaugurated both contestants were called to Washington and both were patiently heard and the questions presented were patiently and carefully examined. The President held that a case was not presented in which, under the const.i.tution and the laws, he was justified in using the army of the United States in deciding a purely local election contest. The soldiers and bayonets of the United States were then withdrawn from the state house--not from the state, nor the capital of the state--but from the building in which the legislature, that alone could lawfully decide this contest, must meet. This was all that was done by the President, and Governor Chamberlain, without further contesting his claim, abandoned it and left the state.

"I say to you now that, strongly as I desired the success of Governor Chamberlain and the Republican party in South Carolina, the President had not a shadow of right to interpose the power of the army in this contest, and his attempt to do so would have been rash and abortive as well as without legal right.

"The case of Louisiana was far more difficult. The local returning officers of that state had, after a full examination, certified to the election of the legislature, showing a Republican majority in both houses. This had been done by excluding from their return the votes of certain parishes and counties wherein intimidation, violence and fraud had prevailed to an extent sufficient to change the result of the election. I was present, at the request of General Grant, to witness the count, and I a.s.sure you, as I have said officially, that the proof of this intimidation, violence and fraud, extending to murder, cruelty, and outrage in every form, was absolutely conclusive, showing a degree of violence in some of those parishes that was more revolting and barbarous than anything I could conceive of. It was plain that the returning officers had the legal right to pa.s.s upon and certify, in the first instance, who were elected members of the legislature, and that they were justified by the evidence in excluding bulldozed parishes, but it was equally clear that their return was not conclusive upon the members elected, and that each house had the const.i.tutional right to pa.s.s upon the returns and elections of its members, and to set aside the action of the returning board. The two houses, when organized, had also the power to pa.s.s upon the returns of the election of governor, and they alone and no one else. Neither the President of the United States nor the returning board has any power or right to pa.s.s upon the election of governor. And here the difficulty in the Louisiana case commences.

"Governor Packard contends that a majority of the two houses, as duly returned, did pa.s.s upon the election of the governor, and did return that he was duly elected, but this was stoutly denied by Governor Nichols. This vital point was strongly a.s.serted and denied by the adverse parties, and the legislature of Louisiana divided into two hostile bodies, holding separate session, each a.s.serting its legal power, and denouncing the other as rebels and traitors.