In 1870, the total amount of national bank circulation being limited by law to $300,000,000 and largely absorbed in the East, a cry arose in the South and West against this injustice. General Garfield drew up and presented a bill which became a law, increasing the limit $54,000,000, and providing for the cancellation of the surplus of notes in States having more than their quota, as fast as the Southern and Western States, having less than their quota, organized national banks and commenced to issue currency. It was a just measure, and was exactly in the line of future legislation, but the Western and Southern States had no capital to invest for banking purposes, and consequently availed themselves but slightly of the opportunity. The measure, however, was of a character to allay public clamor, demonstrate the folly of the outcry against the existing law, and facilitate the progress toward resumption. It was the forerunner of the law, removing all limit to national bank circulation, and making the volume of the currency adjustable to the demand. General Garfield’s great speech on the bill, delivered June 7, 1870, has been the inexhaustible quiver from which most of the arrows of financial discussion have since been drawn by all smaller marksmen. A second speech on the same subject on June 15th, was but little its inferior.
The last day of the Forty-First Congress witnessed a remarkable attempt of the Senate to encroach upon the constitutional prerogative of the House to originate all bills for raising revenues, the claim being that the measure was one to reduce revenue instead of raising it. It was a bill to abolish the income tax. Garfield favored the reduction, but an encroachment which might become a dangerous precedent had to be resisted. His argument covered the vast field of the history of the House of Commons, the debates of the Constitutional Convention, and the precedents of Congress. His conclusions were:
First.—That the exclusive right of the House of Commons of Great Britain to originate money bills, is so old that the date of its origin is unknown; it has always been regarded as one of the strongest bulwarks of British freedom against usurpation of the King and of the House of Lords, and has been guarded with the most jealous care; that in the many contests which have arisen on this subject between the Lords and Commons, during the last three hundred years, the Commons have never given way, but have rather enlarged than diminished their jurisdiction of this subject; and that since the year 1678, the Lords have conceded, with scarcely a struggle, that the Commons had the exclusive right to originate, not only bills for raising revenue, but for decreasing it; not only for imposing, but also for repealing taxes; and that the same exclusive right extended also to all general appropriations of money.
Second.—The clause of our Constitution, now under debate, was borrowed from this feature of the British Constitution, and was intended to have the same force and effect in all respects as the corresponding clause of the British Constitution, with this single exception, that our Senate is permitted to offer amendments, as the House of Lords is not.
Third.—In addition to the influence of the British example, was the further fact, that this clause was placed in our Constitution to counterbalance some special privileges granted to the Senate. It was the compensating weight thrown into the scale to make the two branches of Congress equal in authority and power. It was first put into the Constitution to compensate the large States for the advantages given to the small States in allowing them an equal representation in the Senate; and, when subsequently it was thrown out of the original draft, it came near unhinging the whole plan.
“It was reinserted in the last great compromise of the Constitution, to offset the exclusive right of the Senate to ratify treaties, confirm appointments, and try impeachments. The construction given to it by the members of the Constitutional Convention, is the same which this House now contends for. The same construction was asserted broadly and fully, by the First Congress, many of the members of which were framers of the Constitution. It has been asserted again and again, in the various Congresses, from the First till now; and, though the Senate has often attempted to invade this privilege of the House, yet in no instance has the House surrendered its right whenever that right has been openly challenged; and, finally, whenever a contest has arisen, many leading Senators have sustained the right of the House as now contended for.
“Again, if the Senate may throw their whole weight, political and moral, into the scale in favor of the repeal or reduction of one class of taxes, they may thereby compel the House to originate bills, to impose new taxes, or increase old ones to make up the deficiency caused by the repeal begun in the Senate, and thus accomplish by indirection, what the Constitution plainly prohibits. What Mr. Seward said in 1856, of the encroachment of the Senate, is still more strikingly true to-day.
“The tendency of the Senate is constantly to encroach,—not only upon the jurisdiction of the House, but upon the rights of the Chief Executive of the nation. The power of confirming appointments is rapidly becoming a means by which the Senate dictates appointments. The Constitution gives to the President the initiative in appointments, as it gives to the House the initiative in revenue legislation. Evidences are not wanting that both these rights are every year subjected to new invasions. If, in the past, the Executive has been compelled to give way to the pressure, and has, in some degree yielded his constitutional rights, it is all the more necessary that this House stand firm, and yield no jot or tittle of that great right intrusted to us for the protection of the people.”
This speech was absolutely conclusive on the question, and must take its place with all the immortal arguments and efforts put forth in the past to preserve the rights of the popular branch of national legislature. February 20, 1871, General Garfield delivered a powerful speech against the McGarraghan claim, one of the many jobs of which Congress was the victim.