I soon found that Mr. Bayard and Mr. Beck were quite opposed to each other on this topic, and I suggested that I thought that the argument upon it should be between them. My own opinions were sufficiently stated in the report in which I submitted to Congress whether the legal tender should not be repealed as to all future contracts, and parties be left to stipulate the mode of payment. I said that United States notes should still be receivable for all dues to the government, and ample provision should be made to secure their redemption on demand.
The examination, or, rather, conference, took a wide range between the members of the committee and myself. Mr. Beck pressed me to express my opinion of the legal tender which was contained in the bill introduced by him, providing for a mandatory legal tender of all forms of money. I answered:
"I do not think, Mr. Senator, you ought to ask me that question, because that is a matter you are called upon to decide and pass upon in your sphere as a Senator. I would say, on the other hand, that I do not think it ought to have any such effect. I suppose, however, Mr. Bayard would very frankly tell you what the intention of the resolution is."
Mr. Bayard then said:
"I know one thing: That banks cannot compel me to receive their notes for debts due me, nor can any man compel me to receive them. If the government owes me my salary, I think they could, perhaps, pay me in the national bank notes, under the existing law, but you cannot compel the payment of a debt between private parties with it."
I said:
"If you will allow me, I should like to amplify a little on one point: I think if Congress would take up this question of the modification of the legal tender note and make certain rules of evidence (which would be clearly constitutional), which good lawyers undoubtedly approve, declaring that where a contract is made between parties upon the basis of United States notes, it shall be presumed by courts, in the affirmance of contracts, that the payment in United States notes shall be a sufficient compliance therewith, and that, in the absence of any absolute provision to the contrary, paper money, or promises to pay money, shall be a legal tender in discharge of any obligation."
In respect to the cost of refunding, the next subject of inquiry, I was able to give them full details, with all the orders of the treasury department from the 16th of January, 1878, until the close of these operations in the summer of 1879. Many of these details had not then been published, but I furnished the fullest information available. In response to an inquiry as to the amount of commissions paid to the national banks on account of the sale of the four per cent. bonds, a full table was exhibited of the subscriptions of, and commissions paid to, the twenty-six national banks chiefly engaged in this business, in which the total amount of sales made by them was shown to be $552,929,100, and the amount of commissions paid was $1,363,070.34. In exhibiting these tables I said:
"Here is a table showing the sales and commissions of certain banks. I have taken all banks who sold over $1,000,000. There were twenty- six of them. The First National Bank, having been always connected with the national securities and having been the agent of the syndicate, continued to be the agent of the foreign syndicate, and continued to have altogether the largest business. They sold of the four per cent. bonds $262,625,000. The sales of the other banks are kept here in the same way. The Bank of New York (National Banking Association), I think, was the next. It sold $57,259,500. The National Bank of Commerce sold $51,684,000; the National Bank of the State of New York sold $46,915,000, and so on down."
I called attention to the fact that in the last sale of about $200,000,000 four per cent. bonds, we received one-half of one per cent. premium, or a million dollars, which nearly covered the entire commissions paid to the twenty-six banks named. Full details were given of the various loans, and it was shown that the cost of selling the last loan was less expensive to the government, in proportion to the amount sold, than any previous loan.