I wish to make a statement to the Senate in regard to a bill that is pending between the two Houses on an amendment.

It is the bill (S. No. 352) to authorize the temporary supply of vacancies in the Executive Departments. It belongs to that class of bills which ought to be passed early that it may go to the Executive. It is pending now on an amendment of the House of Representatives, and in the Judiciary Committee we have agreed to the House amend ment with a slight amendment which we have recommended. I do not think it will take three minutes to dispose of it. I was very anxious yesterday to dispose of it, but the Senator from Vermont [Mr. EDMUNDS] wanted to look at it.

Mr. HOWARD. Let us take a vote on this bill first.

Mr. TRUMBULL. If you will lay it aside for a moment after it is taken up in order to have this amendment disposed of I will not object.

Mr. HOWARD. Very well.

Mr. CATTELL. I must object to taking up the bill of the Senator from Michigan if it is to supplant the bill which I have moved that the Senate proceed to the consideration of. It is a bill that ought to be disposed of. I have been instructed by the Committee on Finance to insist upon the consideration of the bill. I am sorry ever to interfere with a Senator, but I am constrained, as a matter of duty, to do it on the present occasion.

Mr. HOWARD. I have this to say in reply: if I can get this bill up and read that will satisfy me for the present, and I will throw no more embarrassment in the way of other gentlemen; but I want to put this bill in a way so that at the proper time I can have it passed. Mr. CATTELL. Will the Senator from Michigan give way to this bill afterward?

Mr. HOWARD. After the bill is read I will yield.

The PRESIDENT pro tempore. The question is on the motion of the Senator from Michigan.

The motion was not agreed to.

VACANCIES IN EXECUTIVE DEPARTMENTS. Mr. TRUMBULL. Now I move that the Senate proceed to the consideration of the amendment to the bill which I have indicated, which I am sure will take but a moment or two. I assure the Senator from New Jersey that it will take no time scarcely, and it is important that it should go back to the House.

The motion was agreed to; and the Senate proceeded to consider the amendment of the House of Representatives to the bill (S. No. 352) to authorize the temporary supply of vacancies in the Executive Departments. The amendment of the House was to strike out all of the original bill after the enacting clause and to insert in lieu thereof the following:

That in case of the death, resignation, absence, or sickness of the head of any executive Department of the Government, the first or sole assistant thereof shall, unless otherwise directed by the President of the United States, as is hereinafter provided, perform the duties of such head until a successor be appointed, or such absence or sickness shall cease.

SEC. 2. And be it further enacted, That in case of the death, resignation, absence, or sickness of the chief of any bureau, or of any officer thereof whose appointment is not in the head of any executive Department, the deputy of such chief or such officer. or if there be no deputy then the chief clerk of such bureau, shall, unless otherwise directed by the President of the United States, as is hereinafter provided, perform the duties of such chief or of such officer until a successor be appointed or such absence or sickness shall cease.

SEC. 3. And be it further enacted. That in any of the cases hereinbefore mentioned it shall be lawful for the President of the United States, in his discretion, to authorize and direct the head of any other executivo Department or other officer in either of those Departments whose appointment is, by and with the advice and consent of the Senate, vested in the President, to perform the duties of the office vacant as aforesaid until a successor be appointed. or the sickness or absence of the incumbent shall cease: Provided, That nothing in this act shall authorize the supplying as aforesaid a vacancy for a longer period than ten days when such vacancy shall be occasioned by death or resignation, and the officer so performing the duties of the office temporarily vacant shall not be entitled to extra compensation therefor.

SEC. 4. And be it further enacted. That all acts here

tofore passed on the subject of temporarily supply

ing vacancies in the Executive Departments, or which empower the President to authorize any person or persons to perform the duties of the head of any executive Department, or of any officer in either of the Departments, in case of a vacancy therein or inability of such head of a Department or officer to discharge the duties of his office, and all laws inconsistent with the provisions of this act be, and the same are hereby, repealed.

The Committee on the Judiciary reported an amendment to the House amendment, to insert at the end of the third section the following:

And provided also, That in ease of the death, resignation, absence, or sickness of the Commissioner of Patents, the duties of said Commissioner, until a successor shall be appointed or such absence or sickness shall cease, shall devolve upon one of the examiners in chief in said office, to be designated by the President.

Mr. TRUMBULL. There is another slight amendment before that, to insert the words except the Commissioner of Patents" after the word "thereof," in line three of section

two.

Mr. CONKLING. That is really part of the same amendment.

Mr. TRUMBULL. Yes, sir.
The amendment was agreed to.

The PRESIDENT pro tempore. The question now is on concurring in the amendment of the House as amended.

Mr. WILLIAMS. We ought to know what that is.

Mr. TRUMBULL. It is printed and on your table.

Mr. EDMUNDS. If there is no special objection, before this bill passes I should like to offer an amendment.

Mr. TRUMBULL. I do not think there is any objection to the amendment the Senator from Vermont wishes to offer. I think it means that now.

Mr. EDMUNDS. So do I; but we have had so much discussion about these loose and latitudinarian powers that I wish to offer an amendment to come in at the end of the second section, and which will read as follows:

And no appointment, designation, or assignment otherwise than as herein provided in the cases mentioned in the first and second sections of this act shall be made, except to fill a vacancy happening during the recess of the Senate.

The amendment was agreed to.

The amendment of the House of Representatives, as amended, was concurred in.

WASHINGTON TARGET-SHOOTING ASSOCIATION.

Mr. HARLAN submitted the following report:

The committee of conference on the disagreeing votes of the two Houses of the bill (H. R. No. 344) to incorporate the "Washington Target-Shooting Association" in the District of Columbia, having met, after full and free conference have agreed to recommend, and do recommend, to their respective Houses, as follows:

That the House recede from its disagreement to the amendment of the Senate to the said bill, and agree to the same with an amendment, as follows:

Strike out of said amendment, after the word "provided," in the first line, the following words: The amount of real property or estate to be held by the said association shall not exceed in value the sum of $50,000; and provided further that."

JAMES HARLAN,
GEORGE VICKERS.
ROSCOE CONKLING,
Managers on the part of the Senate.
JOHN D. BALDWIN,
M. WELKER,

A. J. GLOSSBRENNER,
Managers on the part of the House.

The report was concurred in.

TEMPORARY LOAN CERTIFICATES.

Mr. CATTELL. I now move to proceed to the consideration of the bill (S. No. 543) to provide for a further issue of temporary loan certificates, for the purpose of redeeming and retiring the remainder of the outstanding compound-interest notes.

Mr. POMEROY. I do not like to oppose these bills from the Committee on Finance, but they have every day after one o'clock, and they will have during the whole session; but for them to occupy the morning hour, and then every day from one o'clock out, seems to me to be a little too much.

The motion was agreed to; and the Senate, as in Committee of the Whole, resumed the

consideration of the bill (S. No. 543) to provide for a further issue of temporary loan cer tificates, for the purpose of redeeming and retiring the remainder of the outstanding compound-interest notes, the pending question being on the amendment of Mr. TRUMBULL, to strike out all of the bill after the enacting clause and in lieu thereof to insert:

That for the purpose of redeeming and retiring the remainder of the compound-interest notes, saving the unnecessary payment of interest, and reducing the public debt, the Secretary of the Treasury is hereby authorized and directed to make sale of $10,000,000 of the surplus coin in the Treasury of the United States, on the first Monday of the month of August next, and on the first Monday of every month thereafter, till the amount of coin in the Treasury, exclusive of that for which gold certificates of deposit shall have been given, shall be reduced to the sum of $40,000,000, the sale to be made in manner following: the Secretary shall give five days' public notice in one daily newspaper published in each of the cities of Washington and New York, that sealed proposals for $10,000,000 of gold coin will be received at the office of the Assistant Treasurer in the city of New York till three o'clock p. m. of the day appointed for the sale. Such proposals shall bo addressed to the Assistant Treasurer at New York, and shall be opened by him in the presence of such persons as may choose to attend at the time designated in the notice. No proposals shall be received unless accompanied by a certificate of deposit in the Treasury of the United States of five per cent. in eurrency of the amount of coin bid for in such proposal, which shall be received in part pay for the coin bid for, in case the bid is accepted, and if not accepted, shall be returned to the party who inado the bid. Payments may be received for coin in currency or compound-interest notes with the interest accrued thereon. When compound-interest notes are received they shall be canceled by the Secretary of the Treasury, and with the currency received he shall purchase and cancel any interest-bearing indebtedness of the United States, paying t .crefor not exceeding its current market value at the time. None but the highest bid shall be accepted for gold; and in case of different bids at the same rate, said bids shall be accepted only pro rata; and the Assistant Treasurer, with the approval of the Secretary of the Treasury, shall have the right to reject all or any bids if deemed by him less than the fair value of gold at the time.

Mr. TRUMBULL. When the morning hour expired some days ago, I was addressing the Senate upon the subject of that amendment. I shall not repeat this morning what I said on that occasion, and will say nothing more, as I wish to take up no time unnecessarily; but I simply beg to call the attention of the Senate to what it is, as there are some Senators now present who were not here on that occasion, and it may have passed out of the minds of others.

The object of my amendment is to dispose of the gold in the Treasury. I presented tables when up before showing that the average amount of gold per month in the Treasury during the last year exceeded eighty-three million dollars, beside about about twenty million dollars for which certificates of deposit had been issued. I also showed that the amount of currency in the Treasury during the same period averaged something over thirty-four million dollars, and that the two together, the gold being turned into currency at its market price, would make a sum of more than one hundred and fifty million dollars which lay in the Treasury idle during the whole of the last year. The tables which I have also show that the amount which lay idle in the Treasury during the previous year was about the same; so that during the last two years there has been in the Treasury of the United States at all times from eighty to one hundred millions of coin lying idle, and from thirty to forty millions of currency, which I undertook to show was very bad economy; and I have proposed an amendment to this bill the object of which is to dispose of this gold. The amendment is in print and on the tables of Senators. It provides for dispos ing of this gold in the city of New York at the rate of $10,000,000 per month until the amount is reduced to $40,000,000, not to be reduced below that, and the gold to be sold on proposals, and to be awarded to those who give the highest price for it, after giving five days' notice in the papers of New York and Washington city, so as to have the benefit of this gold. If the gold which has been in the Treasury for the last two years had been sold and used by the Government, it would have saved the Govern

ment more than $10,000,000. It seems to me there is no object in keeping the money there; at least, I know of none. No financial policy has been adopted which requires this money to be kept in the Treasury.

Mr. CATTELL. Mr. President, I listened with attention to the remarks of the Senator from Illinois when he addressed the Senate last week in opposition to the bill under consideration, and am surprised at his hostility to a measure so obviously advantageous to the Government.

The provisions of the bill are so simple, its purpose so obvious, and the advantage to the Government so apparent, that I am at a loss to account for the opposition of the Senator from Illinois. The entire question, and the only one involved, is whether the Government, owing as it does something over two thousand million dollars, for nearly all of which it is paying six per cent. interest in gold, shall accept a loan of $25,000,000 at three per cent. currency, thus reducing the interest on that amount more than one half.

Now, Mr. President, if there is one subject which more than any other is engaging the attention of the American people, and challenging the consideration of both statesmen and politicians, it is how the Government can, while maintaining its faith with the public creditor, reduce the interest on the public debt, and thereby lighten the burdens of taxation. This has been a fruitful theme for discussion in Congress and out of Congress, and it has been declared to be the duty of Congress to work in this direction by the great political party with which the Senator and myself affiliate.

I commend the fifth article of the Chicago platform to the consideration of the Senator from Illinois. It reads:

5. The national debt, contracted as it has been for the preservation of the Union for all time to come, should be extended over a fair period for redemption, and it is the duty of Congress to reduce the rate of interest thereon whenever it can possibly be done.

And I desire to say in this connection that while I hold it to be the first duty of the Government to maintain at all hazards the faith of the nation and meet all its obligations to the public creditor, not only according to the letter, but the spirit of the laws under which they were contracted, I also hold that it is the bounden duty of Congress to avail itself of all honorable means to reduce the rate of interest by negotiating, if possible, a loan at a lower rate, as is proposed in the funding bill of my friend from Ohio, by exchanging the fivetwenty bonds, with the consent of the holder, for a longer bond with more distinct and definite terms as the equivalent for a lower rate of interest, or by any other method consistent with the perfect maintenance of the public faith and honor.

And yet when the Finance Committee brings to the Senate a feasible proposition to convert a debt upon which we are paying six per cent. compound interest into a three per cent. currency loan, the astute Senator from Illinois objects, and expresses his surprise that so important a bill_should be called up in the morning hour. Is the Senator from Illinois opposed to the Government taking money at three per cent. if it can get it, and reducing to that extent the loans upon which we are paying six per cent. in gold?

Now, the question of how much or how little balance shall be held in the Treasury, so largely discussed by the Senator, has no bearing upon this bill. That is entirely a different question, one which I am aware is a source of great distress to the honorable Senator, and I sincerely wish he could obtain relief in some form. But the Senator will find that there are differences of opinion on this question which seems so clear to him, even in this Chamber, and it ought not to be mixed up with a proposition such as that now before the Senate.

But suppose, for the sake of the argument, that we are holding more coin in the Treasury than is wise, that the surplus ought to be sold

and the proceeds applied to the payment of the public debt, surely it would be the part of wisdom to apply this surplus to the reduction of the debt upon which we are paying six per cent. gold interest. This proposition is so simple it does not admit of argument. Why, sir, we are issuing bonds almost daily in exchange for the seven-thirties, with interest at six per cent. in gold. Why not use the surplus, if we have any, to take up some of these notes at the market rate, and accept a three per cent. currency loan to retire the compoundinterest notes. The interest on $25,000,000 at six per cent. gold, estimating the premium at forty per cent., the present rate, would be $2,100,000 in currency, while the interest on $25,000,000 at three per cent. currency would be but $750,000, thus making an annual saving of $1,350,000. We have already, in the form of these temporary loan certificates, placed $50,000,000, and when these $25,000,000 are added the annual saving of interest on the $75,000,000, as compared with our six per cent. gold loans, will be $4,050,000. Has the Senator from Illinois any objection to this saving of over four million dollars annually, or does the arithmetic he uses give a different result?

I submit, therefore, Mr. President, that even if we have a surplus in the Treasury it does not make against the proposition to accept a loan at three per cent., which may be applied to the payment of bonds upon which we are paying more than twice as high a rate of

interest.

But have we this large surplus of coin of which the Senator speaks now in the Treasury? If the Senate will give me their attention I think I shall be able to show that the Senator has not been as careful as he should be when he deals with figures as connected with the national finances; and I cannot consent that his statement shall go to the country without correction. The Senator proceeds upon the assumption that we have something over eighty millions of gold in the Treasury belonging to the United States. Now, what are the facts in the case? I read from a statement prepared for me by the Secretary of the Treasury himself on Friday last, which is as follows: Amount of gold in the Treasury July 1, 1868..$99,914,105 From which deductInterest payable July 1, 1868. Bonds of 1848 maturing July 1, 1868. Gold certificates.....

Leaving a balance July 1....................................

31,000,000 6,893,441 17,678,640

$55,572,081 ..$44,342,024

our estimates, both for import duties and internal tax. This has been largely the case since the close of the war, so much so that estimates made to about cover current expenses and interest on the public debt have so far exceeded as to furnish a surplus of some three hundred millions to be applied to the reduction of the public debt. But it would be unsafe and unwise in the face of the reductions we have made on the tax list to depend upon our receipts to pay the $30,000,000 of compound-interest notes which fall due between this and 15th October, and of course must be paid.

I submit, then, Mr. President, that the proposed loan is the simplest, easiest, and cheapest form of providing for these maturing obligations, and trust that the Senate will disagree to the amendment offered by the Senator from Illinois as impracticable and pass the bill as it came from the committee. As I stated on a previous occasion, the Committee on Finance are unanimously in favor of the bill, and it is warmly approved by the Secretary of the Treasury and the Comptroller of the Currency.

Mr. TRUMBULL. Mr. President, I cannot permit the manifest fallacy of the statement of the Senator from New Jersey to go unchallenged. It is a most remarkable way of stating a balance in the Treasury to compute all the payments that will have to be made out of the Treasury and say nothing about the receipts. The Senator from New Jersey tells us that we are liable to pay $7,000,000 for Alaska; that there is a maturing indebtedness of the United States which we may be called upon to pay.

Mr. CATTELL. It is paid.

Mr. TRUMBULL. That we have to pay interest on the debt. Surely we do. We would not want this gold if there were none of these obligations. But did the Senator tell us how much gold we were receiving? He told us he was afraid, in consequence of the reduction of the internal revenue taxes, that our receipts would be less. What has that to do with the receipts from customs? Did the Senator from New Jersey tell us that the duties had been reduced? He did not say a word about that. I stated the other day, and the official report of the Secretary of the Treasury will show the facts which I state, that the receipts from customs for the year ending June 30, 1867, were upward of $176,000,000 in gold. What does the Senator from New Jersey propose to do with that? I stated that during the last year, for which we had full reports, as shown by the report of the Secretary of the Treasury in his last annual report, there were received in gold from customs for the year ending June 30, 1867; the report for the year

Beside the currency in the Treasury on the 1st July was but $27,877,751, quite low enough when we consider the magnitude of the Treasury operations, and the fact that we owe $10,000,000 payable on demand and liable to be called for any day.

Moreover, we have at this session of Congress made very important reductions of internal revenue taxes. We have taken off the tax on cotton, and also on all manufactures, making an estimated reduction of some fifty or sixty million dollars; and although we expect some increase from other sources the amount to be received from internal revenue in the next fiscal year is somewhat problematical, and we ought not, therefore, run the Treasury too close.

I do not, however, sympathize with the views entertained by many that we shall have a deficit at the end of the next fiscal year. The development of our great country is so rapid and its resources so immense, the enterprise and energy of our people so wonderful, that our receipts are almost uniformly in excess of

but that is the report made to us at the commencement of the present sesssion of Congress-$176,417,810 88. What does the Senator from New Jersey propose to do with that?

Mr. CATTELL. I answer the gentleman just here. The constant practice of the Seeretary of the Treasury is to sell the gold down to a point which he thinks is safe and convert it into currency and use it for current expenses. Further, while I am on my feet, let me say to the Senator that the receipts of gold from duties were only about one half for the month of June, 1868, what they were for June, 1867. The receipts have fallen off and have been falling off, and the probabilities are that they will continue to do so. The Secre tary of the Treasury told me that you could not compute at the extreme the income now at more than from ten to twelve millions per month.

Mr. TRUMBULL. I have a little information on that subject. I stated what the re ceipts from customs were for the fiscal year ending June 30, 1867. The Secretary in his report gave us one quarter's receipts during the last fiscal year. The receipts from customs for the quarter ending September 30, 1867, were $48,081,907 61; so that the receipts were much larger that quarter of the fiscal year ending June 30, 1868, than they were the yest before.

Mr. CONKLING. That would be $192,- || 000,000 a year.

Mr. TRUMBULL. Yes; that would be $192,000,000 for the year if it kept on at that rate. But the Senator from New Jersey says the receipts were very small for last June. Possibly they may have been. I have not those figures before me, but it appears from the last official report to which I had access that we were receiving duties at the rate of $192,000,000 a year in gold during the last fiscal year that ended only a few days since. Certainly during the first quarter of that year we received more than forty-eight millions. The Senator, when I ask him what is to be done with this money, says the Secretary is to sell it. Well, I want him to sell it down to $40,000,000. My amendment would do no harm, let me say to the Senator from New Jersey, if there is no gold more than is required.

Mr. CATTELL. You do not provide for the payment of the $30,000,000 of compound

notes.

Mr. TRUMBULL. I think you will find enough to sell. The Senator from New Jersey did not tell us what the receipts for July were. We had eighty-three millions of gold on the 1st day of July belonging to the Government. If any of it has gone out since, it has been paid since this report, which was made by the Secretary of the Treasury at my instance within a few days.

Mr. CATTELL. That was made up to June 1, I think.

Mr. TRUMBULL. No, sir; made up to July 1, and if any money has been paid, if any thirty millions have been paid for interest, it is since the 1st of July.

Mr. CATTELL. It was not due till the 1st of July.

Mr. TRUMBULL. We all know it has been very much the custom to anticipate the interest and to pay it out before the 1st day of July. I do not know whether any of the interest was paid in this particular instance before the 1st day of July; but on the 1st day of July, according to this official report, there were $82,235,465 95 of gold coin in the Treasury belonging to the Government, and $17,000,000 more for which certificates of deposit had been issued. In round numbers, there were $100,000,000 of gold in the Treasury on the 1st day of July last.

What do you want to keep $40,000,000 of gold in the Treasury at all for, except to guard against a contingency? As I said the other day, my own judgment was that it was wholly unnecessary to keep such a large sum as that. I think $25,000,000 would be ample, but out of deference to the opinions of others who have insisted upon keeping this amount in the Treasury for the last year, I have put it at $40,000,000. How does the Senator from New Jersey meet it? The official report of the Secretary of the Treasury says that there have been in the Treasury during the last two years more than eighty millions all the time, notwithstanding the interest we have to pay. Now, I propose that we shall sell this gold monthly in the manner proposed, until we reduce it down to $40,000,000. That is my proposition, and I do not think it is fairly met by telling us what we have got to pay, and not saying a word about the receipts. The receipts in coin greatly exceed the payments in coin, and have done so for the last two years, and I have not the least doubt will greatly exceed the payments in coin during the present year.

The PRESIDENT pro tempore. The question is on the amendment offered by the Senator from Illinois.

Mr. TRUMBULL. I should like to have the yeas and nays on that.

Mr. CONKLING. Is it a substitute or an addition?

Mr. TRUMBULL. It is a substitute. Mr. HENDRICKS. I should like to hear the amendment read.

The Secretary read the amendment. Mr. CAMERON. Mr. President, it seems to me proper that we should begin to pay the

public debt; and I do not see any project offered that looks better than this. We have, I believe, about one hundred million dollars lying in the Treasury idle. We have certainly had about that amount there lying idle for the last three years. That does not appear to me to be wisdom. It is not the way an individual would manage his own affairs. An individual whose credit was not very good, and who wished to restore it and get it on a proper basis, would begin by paying every surplus dollar that he had to his creditors, thereby convincing them of his honesty and his belief in his own ability to pay his debts. If we sell ten millions of gold per month, as proposed by the Senator from Illinois, we shall pay off with it fourteen millions of our debt, taking gold at an average of about forty per cent. premium. In place of that we suffer this money to remain idle in the Treasury, in the vain hope, as I believe, that men who are now getting six per cent. for the obligations of the Government which they hold, will give up the right to demand six per cent. and take three per cent.

I object to all these expedients. They are like the constitutional drunkard trying to cure himself by taking a little each day. The only cure for him is to leave off immediately. The only cure for our troubles is for us to get back to a regular system and not resort to these expedients. It would have been better, in my opinion, if the Committee on Finance had given us a general system of finance, one which would have recommended itself to the common sense of everybody here, and which would have convinced the country that we were going to do something toward paying our debts. I do not believe that except in a few cases anybody will give up an obligation of the Government draw. ing six per cent. interest for a certificate bearing but three per cent. There are a few cases where it will be done. Banks that want to hold these certificates as part of their reserve will do it because in that way they get three per cent. upon their surplus capital, and it will be very convenient for some of the banks to use these three per cent. certificates. It will have but little effect beyond here and there a bank that will be glad to use them.

As I have said frequently, I would much rather leave this whole business until we come back next winter. Let us go before the country on no new questions, allowing us to devote our whole time to convince our constituents that the country is in a condition to be reconstructed, if we do our duty, relying also for ourselves upon our acts here, upon the disposition we have shown to meet every public engagement, and our determination to keep the public faith and pay fully the public obligations.

I have not paid much attention to the subject immediately before us; but I am satisfied, as a plain business man, that if I had money lying in my vaults, and I had creditors pushing me daily and doubting my intention to pay, the first thing I would do would be to give them every cent that I had in my possession; and especially would I do so if I had daily and hourly large sums of money coming into my treasury. We are receiving money from imports and from taxes all the time, and yet we leave this money lying in the Treasury in the vain hope that keeping it there will enable us to meet specie payments. To my mind, as the Senator from Vermont said on another occasion, that is ridiculous. When the country is in a condition to resume specie payments, this little sum of $100,000,000, much as it may sound, will be very small. Let us get clear of the greenbacks, as we shall after a while when our credit is restored, and there will be very few demands upon the Treasury; but above all things let us have all the States of the Union here in the Senate acting together with one heart and one mind for the restoration of the credit of the country, and there will be no difficulty about it. I object to this measure entirely because it is one of those temporary expedients; one of those things which are put forward by those who do not look at the whole subject before them, and is unfit, I

believe, for the consideration of the Senate of the United States.

Mr. MORTON. I desire to offer a substi tute for the amendment of the Senator from Illinois, if it is in order, in these words:

That the surplus gold now in the Treasury, and such as shall accrue during the present and next fiscal year. shall be reserved and set apart for the redemption and payment of the legal-tender notes.

Mr. CONKLING. Allow me to ask a single question, that I may understand this amendment. The Senate having, by the aid of the vote of the honorable Senator from Indiana, prohibited the Secretary of the Treasury from retiring any more legal-tender notes, if the gold is set apart for the purpose of that retirement under this amendment, I should like to know what will become of it in fact?

The PRESIDENT pro tempore. The amendment is in order now as an amendment to the amendment of the Senator from Illinois.

Mr. MORTON. I offer it as such. I will only say that we now hold in the Treasury a large surplus of gold. The object of holding it is not expressed by law. Let us say by law that this surplus of gold and the gold which shall accrue in the next year or two shall be held for the purpose of redeeming the legaltender notes, and for no other purpose. Such a declaration in itself, in my opinion, will knock down the premium on gold from ten to twenty per cent. at once.

Mr. CONKLING. Does the Senator mean that it shall be held, and that at the same time we shall retain on the statute-book a prohibition against the cancellation of legal tenders?

Mr. MORTON. I am opposed to the cancellation of legal tenders as that has been done; but, as I said the other day, I am in favor of this Government fixing a time in the future when we shall redeem the legal-tender notes in gold and resume specie payments, and I am in favor of reserving the gold now in the Treasury and that which is to accrue in the ordinary way as a surplus for that purpose, the time to be designated hereafter when the Government will begin the work of redemption and resume specie payments.

Mr. HOWE. Mr. President, I am inclined to vote for the amendment offered by the Senator from Illinois. I am not prepared to discuss the question very satisfactorily to myself how much coin we ought to keep in the Treasury; but it has seemed to me that a prudent Administration ought to be able to calculate their wants a good deal closer than $100,000,000; that it ought not to be necessary to keep $100,000,000 in the Treasury to meet unforeseen demands. That, I believe, has been about the way our finances have been administered since the close of the war. I think we could calculate our necessities more closely than that, and I am, therefore, inclined to adopt some expedient which will reduce this surplus in the Treasury.

The Senator from New Jersey, however, says that if we conclude to do that it is better to sell this coin and redeem the five-twenties. Why so? The five-twenties we are not obliged to pay. The compound-interest notes we are obliged to pay. If you have funds in the Treasury which you can dispense with it seems to me the better use to make of them is to supply the most pressing demand, and the most pressing demand seems to me to be that which you cannot postpone.

Mr. CATTELL. You can postpone it by paying three per cent. interest.

Mr. HOWE. The Senator says we can postpone it by paying three per cent. interest. And so we can postpone the same amount of fivetwenties.

Mr. CATTELL. By paying six per cent. in gold.

Mr. HOWE. We can raise the same amount of money with your three per cent. certificates. But it was upon this point that I wished to say the few words I have to say; and I speak on this question always with a great deal of diffidence, and not at all certain that I can express the views which I really entertain.

notes. The Government cannot redeem the notes without gold any more than a man can pay his debts without money, and the gold cannot be obtained all at once upon a given day, but it must be collected and reserved. What day that shall be, what time shall be fixed to begin this work, I am not now prepared to say; but we are prepared to say that we will begin the work of reserving the gold for that purpose.

We have now in the Treasury a large amount of surplus gold. We have sold within one year back perhaps $40,000,000 that might also have been reserved for this very purpose. We shall collect in the next year at least $40,000,000 of gold that may be reserved for this purpose; and in the course of a year from this time we shall have a very large sum. If we now declare that this gold is to be held as a reserve for the purpose of redeeming these notes, it would at once give the notes a credit they have never had, as I believe. I heard one of the ablest financiers in the country-it was his suggestion-say that the very existence of a large surplus of gold in the Treasury, although there was no declared purpose for which it was held, gave a strength and support and credit to the legal tender notes from expectation of the people that at some time that gold would be applied to their redemp

tion.

Mr. President, the Senator from New York says that we resolved that contraction should cease. What kind of contraction? Not contraction by redeeming our notes in gold and then building up the credit of the Government; but contraction by taking in these notes and putting out gold-bearing bonds. That did not restore the credit of the country; it simply gave oue form of paper for another. That kind of contraction ceased, and ought to have ceased some time before it did. But, sir, let us hold the gold and collect more, and then say that at a certain time, a year hence or two years hence, whatever time Congress in its wisdom next winter may say, the Government shall begin to redeem these notes; and my prediction is that before you get to the time fixed the premium on gold will be down to almost nothing, and a greenback will be as good as gold, and when a greenback is as good as gold it settles the question as to how the bonds are to be paid and it settles a hundred other difficult and troublesome questions.

Sir, we have a debased and depreciated currency to-day not worth more than seventy cents on the dollar. This lies at the foundation of all our financial troubles, and I believe the way to begin is to begin at the foundation, to take some step directly in the direction of returning to specie payment.

Let us say to day that we pledge the surplus gold in the Treasury and that which shall accumulate this financial year and the next to the redemption of the legal-tender notes, and the very moment that declaration becomes a law, in my opinion the premium on gold will go down one half.

Mr. FRELINGHUYSEN. Mr. President, I understand the argument of the Senator from Indiana to be that the best mode to improve our financial condition is to inerrease the public confidence in our ability and intention to pay. I agree that this is the grand idea to our financial recovery. We want to give confidence to the people; and the suggestion made by the Senator from Oregon [Mr. WILLIAMS] that the gold in the Treasury has some value in that regard is well taken. But, Mr. President, nothing can do so much to check the confidence of the American people in the purpose of the Government to deal fairly with its creditors as suggestions every now and then thrown out that we are not legally bound to pay as the people of the United States understand that we undertook to pay that debt. Nothing is so injurious to this country as the suggestion that our securities are to be paid in promises instead of in dollars, as made in the Senate yesterday. The Republican party at Chicago took the true

ground on this subject when it declared in these impressive words:

"We denounce all forms of repudiation as a national crime, and the national honor requires the payment of the public indebtedness in the utmost good faith to all creditors at home and abroad, not only according to the letter, but according to the spirit of the law under which they were contracted."

"Not only according to the letter, but according to the spirit," "the utmost good faith," are the expressions of our party. Can any one deny that, when that convention met, there were some in the country who insisted that our securities might lawfully be paid in promises to pay in greenbacks; and can any one deny that that delaration of the convention was made for the express purpose of negativing the idea that they were to be paid in anything else than coin? That was the purpose of that provis ion of the platform, and it was received by this country with acclamation; and I think that wherever a leader undertakes to commit this party to any other doctrine than that we are to pay all our securities as those who took them understood they were to be paid, he goes contrary to the avowed principles of his party and does it great injury. And while my distinguished friend from Indiana [Mr. MORTON] would be selected by me, perhaps, sooner than any other Senator to be my leader, he cannot represent me or my constituents in holding the doctrine that the bonds of this country are pay able in any other mode than those who received the bonds understood and had a right to understand they were to be paid; and I am satisfied that any party which holds a contrary doctrine underrates the integrity of the American people; the honor of this country is sacred to them. They have invested their money for the purpose of saving this country, and it has been wrung from the sweat of honest toil at the loom and anvil and plow; and the people are ready to pay the last farthing of it.

My learned friend in his argument said that the law does not require that these securities should be paid in coin. I do not agree with him. I understand that by the custom of this and of every other Government, its prom ises were always payable in coin; and unless some declaration is made in the law contravening that custom, when this country makes a promise it is by strict legal construction | payable in coin. I have examined these statutes. The statutes says that the interest shall be payable in coin, without saying the principal. Why? Because it was at a time when specie payments were suspended; and it was only to give the assurance that notwithstanding specie payments were suspended elsewhere, and as to other contracts, this interest as it accrued should be paid in coin. It does not say the principal, because that would be a work of supererogation; and no one doubted that if the country was saved before the principal fell due, being twenty years after date, we would have resumed specie payment, and I do not doubt it now. We find, too, by looking at the act of February 25, 1862, that the Government has by law provided that both the principal and interest shall be paid in coin, for that act expressly declares that there shall be a sinking fund set aside, not to pay the interest of these bonds alone, but also to pay the principal.

But it is argued that because the act of March 3, 1863, authorizing the issue of what are known as ten-forties, provides that the principal as well as the interest shall be paid in coin, that the omission of such a provision as to the principal in the prior acts is very significant. The fact that the law creating the ten-forties states that the principal is to be paid in coin has no significance.

Mr. SHERMAN. I ask my friend to allow the funding bill to be taken up. It is manifest that the other bill is lost sight of and we cannot get a vote on it to-day, and then his speech would be nearer the question before the Senate.

Mr. FRELINGHUYSEN, I shall detain the Senate but a minute or two longer.

Mr. SHERMAN. It is manifest that a vote cannot be obtained on this bill to-day.

Mr. FRELINGHUYSEN. I will finish my remarks, Mr. President.

Mr. SHERMAN. Very well.

Mr. FRELINGHUYSEN. The act of March 3, 1863, does say that the principal is to be paid in coin. But if any one will look at that act of March 3, 1863, he will find that the second act provides for the issue of Treasury notes which are not to be payable ia coin, but to be payable by express provision in lawful money, and therefore it was requisite in the same act to specify how the principal of these tenforties should be paid. As the act necessarily provided that the Treasury notes should be paid in lawful money, when speaking of the principal of these bonds it became necessary to say that they should be paid in coin; and that is clearly the manner in which the expression "in coin" grew into that act.

Besides, those who invested in these bonds had the declaration of the Secretary of the Treasury, Mr. Chase, the Secretary of the Treas ury, Mr. Fessenden, and Mr. McCullough, that these securities were to be paid in coin. We had the declaration and the public advertisements of the agents of this Government; and we all sat here and saw those advertisements made without ever controverting or contradicting them; and the people of this country, men who had fifty and one hundred dollars which they had earned by hard toil came forward with the capitalist and poured their money into the Treasury and took our securities. I rejoice that the great liberty party of the country, the strength of which consists in its advocacy of what is right and just, have in their platform declared that those securities shall be paid in the utmost good faith and according to the letter and the spirit of the contract.

Mr. SHERMAN. Now, unless we can have a vote I ask that the funding bill be taken up. Mr. CATTELL. I hope that the vote will be taken now.

Mr. SUMNER. Let us have a vote.

The PRESIDENT pro tempore. The question is on the amendment of the Senator from Indiana, [Mr. MORTON,] on which the yeas and nays have been ordered.

The question being taken by yeas and nays, resulted-yeas 8, nays 30; as follows:

YEAS-Messrs. Corbett, Edmunds, Morton, Osborn, Patterson of Tennessee, Pomeroy, Ramsey, and Wade-8.

NAYS-Messrs. Anthony, Cameron, Cattell, Chandler, Cole, Conness, Ferry, Fessenden, Frelinghuysen, Harlan, Henderson, Hendricks, Howard. McCreery, McDonald, Morgan, Nye, Patterson of New Hampshire, Rice, Ross, Sherman, Sumner, Tipton, Trumbull, Vickers, Welch, Whyte, Willey, Williams, and Wilson-30.

ABSENT-Messrs. Bayard, Buckalew, Conkling, Cragin, Davis, Dixon, Doolittle, Drake. Fowler, Grimes, Howe, Morrill of Maine, Morrill of Vermont, Norton, Saulsbury, Sprague, Stewart, Thayer, Van Winkle, and Yates-20.

So the amendment to the amendment was

rejected.

The PRESIDENT pro tempore. The question recurs on the amendment of the Senator from Illinois.

Mr. TRUMBULL. At the suggestion of several Senators I will change my amendment so as to offer it as an additional section and not as a substitute, leaving the bill to stand, and moving as an additional section the amendment which I offer, striking out the words relating to the compound-interest notes; in the third line striking out the words "redeeming and retiring the remainder of the compoundinterest notes ;" and in the twenty-eighth and twenty-ninth lines striking out the words "or compound-interest notes with the interest accrued thereon."

Mr. HENDRICKS. I am embarrassed to know how to vote upon the amendment proposed by the Senator from Illinois. The evil of accumulating gold in the Treasury ought to be overcome if possible; but I do not like this mode of overcoming it. My opinion is that the tariff ought to be so adjusted as to bring into the Treasury only the amount of gold that the demands in gold upon the Treasury require. This system of collecting by duties $50,000,000 each year more thau are required in