The second question relating to the greenbacks was that in regard to their volume. At first Congress adopted the policy of contraction and when greenbacks came into the treasury they were destroyed. As continued contraction tended to make the volume of currency smaller and to make money harder to get, and therefore, to raise its value, the debtor classes began to object. As early as 1865 there was strong sentiment against contraction and in favor of paying the public debt in paper. Economic distress in the West furthered the movement and some of the Republican leaders were doubtful of the wisdom of reducing the outstanding stock of paper. Contraction was stopped, therefore, in 1868, and only President Grant's veto in 1874 prevented an increase in the amount. Eventually, in 1878, the amount then in circulation—$346,681,000—was fixed by a law forbidding further contraction.[1]
The western farmers, meanwhile, were feeling the pinch of falling prices. Believing that their ills were due to the scarcity of money, they opposed the policy of contraction and even launched the Greenback party to carry out their principles. In 1876 it polled 80,000 votes, and in 1878 at the time of the congressional elections over 1,000,000, but thereafter its strength rapidly declined. Neither the East nor the West understood the motives of the other in this controversy. Eastern congressmen considered western insistence upon a large volume of currency as a dishonest movement to reduce bond values by legislation. Such an action, they asserted, would do away with the national integrity. The people of the West thought of the eastern bondholders as "fat bullionists" who dined at costly restaurants on terrapin and Burgundy and paid for their luxuries with bonds whose values were raised by a contracted currency.
The third question relating to the greenbacks was that of the resumption of specie payments. At the close of the war practically all the money in circulation was paper, which passed at a depreciated value because it was not redeemable in coin. The obvious thing was to resume the exchange of specie for paper and thus restore the latter to par value, but serious obstacles stood in the way. A money crisis in 1873 aroused a clamor for larger supplies of paper; gold was hard to procure, as France and Germany were both accumulating a redemption fund and specie was actually flowing out of the country. Outside of the treasury there was little gold in the United States, the amount being less than one hundred million dollars as late as 1877. The friends of resumption could not be sure of the feasibility of their project, and the opponents were aggressive and numerous.
In the elections of 1874 the Republicans were severely defeated, and it was seen that the Democrats would have a clear majority in the next House of Representatives. Hence the Republicans hurried through a resumption bill on January 14, 1875—a sort of deathbed act. It authorized the secretary of the treasury to raise gold for redemption purposes, and set January 1, 1879, as the date when resumption should take place. As in the case of the tariff, the political parties found difficulty in determining which side of the resumption question they desired to take. Although the Democratic platform of 1868 contained a greenback plank, yet some of its leaders opposed, and the state platforms of 1875 and 1876 demanded resumption. The national platform of the latter year both denounced the Republicans for not making progress toward resumption and demanded the repeal of the act of 1875, without disclosing whether the party was prepared to offer any improvements. In November, 1877, a bill practically repealing the resumption act passed the House—the western and southern Democrats furnishing most of the affirmative votes, assisted by twenty-seven Republicans. A resolution declaring it to be the opinion of Congress that United States bonds were payable in silver was introduced and advocated by many Republicans. On the other hand, eastern state Democratic and Republican platforms were much alike. Apparently, therefore, differences of opinion in regard to the greenbacks and resumption were caused as much by sectional as by party considerations.
More lasting than finance as a political issue but less enduring than the tariff, was the reform of the civil service. In its widest sense, the term civil service included all non-military government officers from cabinet officials and supreme court judges to the humblest employee in the postal or naval service. The reform, however, was directed mainly toward the appointment and tenure of the lower officers. Before the Civil War the "spoils system" had been in full swing; appointments to positions had been frankly used as rewards for party activity; office-holders had been openly assessed a fraction of their salaries in order to fill the treasure chest at campaign times; rotation in office had been the rule. During the war, President Lincoln had found his ante-room filled with wrangling, importunate office-seekers who consumed time which he needed for the problems of the conflict. As he himself had expressed the situation, he was like a man who was letting offices in one end of his house while the other end was burning down. During the war, also, the patronage at the disposal of the government had vastly increased. Not only had the number of laborers, clerks and officials become greater, but numerous contracts had been let for the production of war materials, and manufacturers and merchants intrigued for a share of federal business. "Influence" and position had been more powerful than merit in procuring the favor of government officers.
After the war many abuses that had earlier been overlooked began to attract the attention of a few thoughtful men. It was estimated that not more than one-half to three-fourths of the legitimate internal revenue was collected during Johnson's presidency, so corrupt and inefficient were the revenue collectors. Endless Indian troubles and countless losses of money resulted from the corruption of the federal Indian agents. Conditions were even worse during the Grant regime. The President's appointments were wretched; he placed his relatives in official positions; revenue frauds amounting to $75,000,000 were discovered during his second administration. In certain departments, it was customary, when vacancies occurred, to allow the salaries to "lapse"—that is, accumulate—so as to provide a fund to satisfy patronage seekers. In one case, thirty-five persons were put on the "lapse fund" for eight days at the end of a fiscal year, in order to "sop up" a little surplus which was in danger of being saved and returned to the treasury. One customs collector at the port of New York removed employees at an average rate of one every three days; another, three every four days; and another, three every five days, in order to provide places for party workers. One secretary in an important department of the government had seventeen clerks for whom he had no employment. The party assessments on officeholders became little short of outrageous. Two or three per cent. of the salary of the lower officers was called for, while the more important officials were expected to contribute much larger sums. In New York—for the system held in the states and cities—candidates for the mayoralty were reputed to pay $25,000 to $30,000; judges, $10,000 to $15,000; and representatives in Congress, $10,000. While these conditions were by no means wholly due to the spoils system, the method of appointment in the civil service made a bad matter worse.
Conditions such as these could hardly fail to produce a reform movement. In fact, as far back as 1853 some elementary and ineffective legislation had attempted a partial remedy. The war gave added impetus to the movement and attention turned to the reform systems of Great Britain and other countries, where problems similar to ours had already been met and solved. The first American who really grasped civil service reform was Thomas A. Jenckes, a member of Congress from Rhode Island. He introduced reform bills in 1865 and later, based on studies of English practice and on correspondence with the leaders of reform there; but no legislation resulted. In brief, his plan provided for the appointment of employees in the public service on the basis of ability, determined by competitive examinations. After a time Jenckes and his associates achieved considerable success and finally interested President Grant in their project. In 1871 they got a rider attached to an appropriation bill which authorized the chief executive to prescribe rules for the admission of persons into the civil service and allowed him to appoint a commission to put the act into effect. George William Curtis, a well-known reformer, was made chairman, and rules were formulated which were applied to the departments at Washington and to federal offices in New York. Grant, although favorable to the reform, was not enthusiastic about it, and soon made an appointment which was so offensive that Curtis resigned. Congress, nothing loath, refused to continue the necessary appropriations and the reform project continued in a state of suspended animation until the inauguration of President Hayes.
The human elements in the struggle for civil service reform, both during the decade after the war and for many years later, are necessary for an understanding of the course of the controversy and its outcome. These elements included the advocates of the patronage system, the reformers and the president.
Sometimes the advocates of the patronage system viewed the reform with contempt. Roscoe Conkling, for example, expressed his sentiments in the remark, "When Dr. Johnson said that patriotism was the last refuge of the scoundrel he ignored the enormous possibilities of the word reform!" Sometimes they attempted to discredit the project by an exaggeration of its effects, as when John A. Logan declared that he saw in it a life-tenure and an aristocratic caste. "It will not be apparent how great is its enormity," he declared in Congress, "how vicious are its practices and how poisonous are its influences until we are too far encircled by its coils to shake them off." The strength of the exponents of the patronage system, however, lay not in their capacity for contempt and ridicule, but in a theory of government that was founded upon certain very definite human characteristics. The theory may be clearly seen in the Autobiography of Thomas C. Platt, a colleague of Conkling in the Senate and for many years the boss of New York state. It may be expressed somewhat as follows.
In the field of actual politics, parties are a necessity and organization is essential. It is the duty of the citizen, therefore, to support the party that stands for right policies and to adhere closely to its official organization. Loyalty should be rewarded by appointment to positions within the gift of the party; and disloyalty should be looked upon as political treason. One who votes for anybody except the organization candidate feels himself superior to his party, is faithless to the great ideal and is only a little less despicable than he who, having been elected to an office through the energy and devotion of the party workers, is then so ungrateful as to refuse to appoint the workers to positions within his gift. Positions constitute the cohesive force that holds the organization intact.