Twenty Years of Congress, Vol. 1 / From Lincoln to Garfield, with a Review of the Events Which Led to the Political Revolution of 1860

by James Gillespie Blaine

GENERAL STONE'S RESIGNATION.

The responsibility for the arrest and imprisonment of General Stone must, according to the official record of the case, rest on Secretary Stanton, Major-General McClellan, and the Committee on the Conduct of the War. It is very clear that Mr. Lincoln, pressed by a thousand calls and placing implicit confidence in these three agencies, took it for granted that ample proof existed to justify the extraordinary treatment to which General Stone was subjected. General Stone is not to be classed in that long list of private citizens temporarily confined without the benefit of habeas corpus, on the charge of sympathizing with the Rebellion. The situation of those persons more nearly assimilates with that of prisoners of war. It differs totally from the arrest of General Stone in that the cause of detention was well known and very often proudly avowed by the person detained. The key of their prison was generally in the hands of those who were thus confined,—an honest avowal of loyalty and an oath of allegiance to the National Government securing their release. If they could not take the oath they were justifiably held, and were no more injured in reputation than the millions with whose daring rebellion they sympathized. But to General Stone the government permitted the gravest crime to be imputed. A soldier who will betray his command belongs by the code of all nations to the most infamous class—his death but feebly atoning for the injury he has inflicted upon his country. It was under the implied accusation of this great guilt that General Stone was left in duress for more than six weary months, deprived of all power of self- defense, denied the inherited rights of the humblest citizen of the Republic. In the end, not gracefully but tardily, and as it seemed grudgingly, the government was compelled to confess its own wrong and to do partial justice to the injured man by restoring him to honorable service under the flag of the Nation. No reparation was made to him for the protracted defamation of his character, no order was published acknowledging that he was found guiltless, no communication was ever made to him by National authority giving even a hint of the grounds on which for half a year he was pilloried before the nation as a malefactor. The wound which General Stone received was deep. From some motive, the source of which will probably remain a mystery, his persecution continued in many petty and offensive ways, until he was finally driven, towards the close of the war, when he saw that he could be no longer useful to his country, to tender his resignation. It was promptly accepted. He found abroad the respect and consideration which had been denied him at home, and for many years he was Chief of the General Staff to the Khedive of Egypt.

It is not conceivable that the flagrant wrong suffered by General Stone was ever designed by any one of the eminent persons who share the responsibility for its infliction. They were influenced by and largely partook of the popular mania which demanded a victim to atone for a catastrophe. The instances in which this disposition of the public mind works cruel injury are innumerable, and only time, and not always time, seems able to render justice. Too often the object of popular vengeance is hurried to his fate, and placed beyond the pale of that reparation which returning reason is eager to extend. Fortunately the chief penalty of General Stone was the anguish of mind, the wounding of a proud spirit. His case will stand as a warning against future violations of the liberty which is the birthright of every American, and against the danger of appeasing popular clamor by the sacrifice of an innocent man. Throughout the ordeal, General Stone's bearing was soldierly. He faced accusation with equanimity and endured suffering with fortitude. He felt confident of ultimate justice, for he knew that it is not the manner of his countrymen "to deliver any man to die before that he which is accused have the accusers face to face, and have license to answer for himself concerning the crime laid against him."

CHAPTER XVIII.

The National Finances.—Debt when the Civil War began.—Deadly Blow to Public Credit.—Treasury Notes due in 1861.—$10,000,000 required. —An Empty Treasury.—Recommendation by Secretary Dix.—Secretary Thomas recommends a Pledge of the Public Lands.—Strange Suggestions. —Heavy Burdens upon the Treasury.—Embarrassment of Legislators. —First Receipts in the Treasury in 1861.—Chief Dependence had always been on Customs.—Morrill Tariff goes into Effect.—It meets Financial Exigencies.—Mr. Vallandigham puts our Revenue at $50,000,000, our Expenditures at $500,000,000.—Annual Deficiency under Mr. Buchanan.—Extra Session in July, 1861.—Secretary Chase recommends $80,000,000 by Taxation, and $240,000,000 by Loans.— Loan Bill of July 17, 1861.—Its Provisions.—Demand Notes.—Seven- thirties.—Secretary Chase's Report, December, 1861.—Situation Serious.—Sales of Public Lands.—Suspension of Specie Payment.— The Loss of our Coin.—Its Steady Export to Europe.

When the civil war began, the Government of the United States owed a less sum than it owed under the administration of Washington after the funding of the debt of the Revolution. The population in 1861 was nine times as large, the wealth thirty times as great as in 1791. The burden therefore was absolutely inconsiderable when contrasted with our ability to pay. But there had been such gross mismanagement of the Treasury, either from incompetency or design, under the administration of Howell Cobb, that the credit of the government was injured. There was embarrassment when there should have been security; there was scarcity when the most ordinary prudence would have insured plenty. So much depended at that moment on the ability of the government to raise money by pledging its faith, that Mr. Cobb perhaps thought he was dealing the deadliest blow at the nation by depriving it of the good name it had so long held in the money markets of the world. With unblemished credit at the opening of the war, the government could have used its military power with greater confidence, and consequently with greater effectiveness.

THE NATIONAL CREDIT INJURED.

At the beginning of the year 1861 it was necessary for the government to raise about $10,000,000 to meet Treasury notes outstanding and the interest secured upon them. Congress had passed, on the 17th of December, 1860, a law authorizing the issue of new Treasury notes for this amount, bearing interest at the rate of six per cent., and redeemable after one year; but the Secretary of the Treasury was authorized to issue them, upon public notice, at the best rates of interest offered by responsible bidders. Before the close of the month negotiations were completed, after unusual effort, and it was found that the notes were issued at various rates, only $70,200 at six per cent., $5,000 at seven per cent., $24,500 at eight per cent., $355,000 at rates between eight per cent. and below ten per cent., $3,283,500 at ten per cent. and fractions below eleven per cent., $1,432,700 at eleven per cent., and by far the larger share, $4,840,000 at twelve per cent. The average for the whole negotiation made the rate of interest ten and five-eighths per cent.

The Treasury was empty, for the nominal balance was only $2,233,220 on the 1st of January. Obligations were accruing to such an extent that General John A. Dix, as Secretary of the Treasury, informed the Committee on Ways and Means of the House of Representatives, that the revenue exhibited, on the 1st of February, a deficit of $21,677,524. The committee estimated that the sum needed to carry on current operations was at least $5,000,000 in addition. A loan of $25,000,000 was proposed, to meet these demands. Secretary Dix, who felt the pulse of the financial centres, recommended in a letter to the Ways and Means Committee that the several States be asked to pledge the United-States "deposit funds" in their hands for the security of the loan. His immediate predecessor, Philip F. Thomas, had, in his annual report in the preceding December, urged that the "public lands be unconditionally pledged for the ultimate redemption of all the Treasury notes which it may become necessary to issue."

Such suggestions seem strange to the ears of those who were afterwards accustomed to the unbounded credit of the Republic. But these secretaries were called to hear from capitalists the declaration that the national debt had increased from $28,460,958 on the 1st of July, 1857, to $64,640,838 on the 1st of July, 1860, and that the figures were still mounting upward. In the mean time the revenues were falling off, the sales of public lands were checked, and the estimates of customs for the current year were practically overthrown by the secession of the Southern States and the denial of the authority of the Union.