“Throughout our history there may be seen a curious uniformity in the movement of the annual expenditures for the years immediately following a war. We have not the data to determine how long it was, after the war of independence, before the expenditures ceased to decrease; that is, before they reached the point where their natural growth more than balanced the tendency to reduction of war expenditure; but in the years immediately following all our subsequent wars, the decrease has continued for a period almost exactly twice the length of the war itself.
“After the war of 1812–’15, the expenditures continued to decline for eight years, reaching the lowest point in 1823.
“After the Seminole war, which ran through three years, 1836, 1837, and 1838, the new level was not reached until 1844, six years after its close.
“After the Mexican war, which lasted two years, it took four years, until 1852, to reach the new level of peace.”
Probably the most remarkable portion of this speech is the following prophecy:
WHEN SHALL WE REACH OUR NEW LEVEL OF EXPENDITURES?
“It is, perhaps, unsafe to base our calculations for the future on these analogies; but the wars already referred to have been of such varied character, and their financial effects have been so uniform, as to make it not unreasonable to expect that a similar result will follow our late war. If so, the decrease of our ordinary expenditures, exclusive of the principal and interest of the public debt, will continue until 1875 or 1876.
“It will be seen by an analysis of our expenditures, that, exclusive of charges on the public debt, nearly fifty million dollars are expenditures directly for the late war. Many of these expenditures will not again appear, such as the bounty and back pay of volunteer soldiers, and payment of illegal captures of British vessels and cargoes. We may reasonably expect that the expenditures for pensions will hereafter steadily decrease, unless our legislation should be unwarrantably extravagant. We may also expect a large decrease in expenditures for the internal revenue department. Possibly, we may ultimately be able to abolish the department altogether. In the accounting and disbursing bureaus of the treasury department, we may also expect a further reduction of the force now employed in settling war claims.
“We can not expect so rapid a reduction of the public debt and its burden of interest as we have witnessed for the last three years; but the reduction will doubtless continue, and the burden of interest will constantly decrease. I know it is not safe to attempt to forecast the future; but I venture to express the belief that if peace continues, the year 1876 will witness our ordinary expenditures reduced to one hundred and twenty-five million dollars, and the interest on our public debt to ninety-five million dollars; making our total expenditures, exclusive of payment on the principal of the public debt, two hundred and thirty million dollars. Judging from our own experience and from that of other nations, we may not hope thereafter to reach a lower figure. In making this estimate, I have assumed that there will be a considerable reduction of the burdens of taxation; and a revenue not nearly so great in excess of the expenditures as we now collect.”
Seven years afterwards, in the June number (1879) of the North American Review, General Garfield quoted the above paragraphs from the speech of January, 1872, and called attention to the fulfillment of his prediction in the following words: