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F I F T Y - T H I E D



S E S S I O N .

we heard many times on this floor in the discussion of the silverpurchase repeal bill. It was an act which was intended to be
temporary and. to meet conflicting views by settling nothing,
practically, but only to bridge over a present condition. There
were men on this floor who were dissatisfied with what was
known as the Bland law, which by way of decoration has an adOF
dition added to it sometimes. They said we were pouring into
the channels of circulation metallic money inferior as respects
the money standard authorized by our laws, namely, the gold
standard, and that therefore we must get rid of the feature of
OF I O W A ,
that law which required the coining, of the silver purchased at
the rate of $2,000,000 worth per month. There were others who
insisted that in lieu of that we should enter upon the experiment of opening our mints to the free and unlimited coinage, at
Monday, March 121189
the ratio of 16 to 3, of all silver that might come to our mints,
without respect to what other nations might do. There were
still others, not many, who were in favor of discarding at once
all relation to and all alliance with silver, and going forward
The Senate having trader consideration the bill (H.R.4956) directing the
straight to a gold standard and a gold circulation alone.
coinage of the silver bullion held in the Treasury, and for other purposesI occupied then a rather conservative position upon this quesMr. ALLISON said:
tion. I believed that it would be wiser to let well
Mr. PRESIDENT: When I made the motion a few days ago to and follow the maxim which some conservatives enough other
reconsider the vote by which the pending bill was ordered to a side of this Chamber are now following, of making on the
haste slowly.
third reading, I did so for the purpose mainly of curing what I be- We had sent to us in 1889 in
of the
lieve to be manifest defects in the bill in its first section, and also Treasury, Mr. Windom (whothe report of the Secretary to this
for the purpose of striking out all, or at least a portion, of the sec- subject, and who desired to solve given great attention own
it so as to utilize our
ond section. It was not then my purpose, nor is it now my pur- silver in some form and at the same time provide a constantly
pose, to enter into the debate of the general question as to what increasing circulation upon the single standard of gold), a sugwe shall do hereafter for silver or what we shall refrain from gestion that we should brand all silver that came to our shores
doing. I know that when the purchasing clause of the Sherman
it could not be
act was repealed last fall, in November, there was a pledge made in such a form thatall the product ofutilized at our mints, and
should use
the American
"by some Senators on tills floor on tlio oilier side of the Chamber, ceivewe into the Treasury at its bullion value on the mines, reday of reand a pledge embodied in the bill itself, that some further action ceipt, it pay for it in treasury notes; and having so received
should be taken in this regard. I had hoped and still hope that it and and notes for it we could again, at our own discretion
the currency legislation of our country, which has been so often and will, or at the will and discretion of the Secretary, redeem
characterized on the other side of this Chamber as a piece of those notes in coined money, or we could pay them in bullion by
patchwork and mosaic, would at the present session, or at least weighing out in ounces the current value of silver bullion at the
during the present Congress, find some general solution. But time of such redemption, and the Bland law, so called, should
that does not yet appear.
cease in its operation, and that no more silver should be coined.
Now, we find coming to us from the House of Representatives
It was believed
a bill which deals wholly with one question, and that is the mittee on Finance by many, certainly by members of the Com*
who then
upon the subject, that
question what this Government shall do with the silver it has whilst this operation on themade a reportTreasury might work
part of
now in the Treasury and.which lies there in the form of bullion, well in the beginning it would onlythe a few years, or a few
and how we shall treat the currency issued to purchase it. I can months perhaps—certainly only a fewyears—when the accumuhardly agree with those who think that the bullion in its pres- lated bullion in the Treasury would operate to depreciate the
ent form is not available for any purpose save one, and that is
and therefore
for sale. It is true that we can riot redeem any of our paper ob- price of the bullion that came from the mines, come in comthe Treasury
ligations in the bullion. We can not make the bullion available petition, and and the producer of silver wouldwould be conthus the price of silver bullion
for the redemption of the obligations of the Government except stantly depreciating by this double competition in the market.
by coining it or selling it. I have yet to hear in this Chamber So the Senate Finance Committee, and the Senate afterwards,
a suggestion made by any Senator or by any committee of the adopted a scheme whereby a part of the plan of the Secretary
Senate that it is the purpose of the Congress of the United States, should be adopted, namely, that he should buy
either present or remote, to authorize the sale of the bullion; and open market to the extent of a certain number .the bullion in
of ounces each
without such authority sale is impossible. Therefore it is clear month, and we should issue the Treasury notes in payment for
that at some time, ii^we, do not^daaljgyitbuthe QUQation tmw _
lhA VuilUpn»which, Treasury notes should bo a legal tender, havshall be obliged to deal with it.
ing the qualities which wo ho w understand them to have, and
I am willing to deal with it now so far as we can, but I do not be redeemed in coin.
believe the method of dealing with it proposed in this bill is a
The House of Representatives passed a different measure.
wise method, when it includes things wholly irrelevant to and These two measures were compromised in the act which is crysoutside of the question of its coinage. The Secretary of the tallized and known as the Sherman act. Both original bills proTreasury has now the authority, if. he chooses to exercise it, as vided for the purchase of silver bullion; the one contemplated
I understand the act of 1890, to coin every dollar of the bullion the exchange of notes for the bullion on demand, the other for
for the purpose of redeeming the Treasury notes oustanding, if coinage. I do not agree with those who believe that there is a
he, in his discretion, deems it necessary to do so. He does not special trust in any way created by the purchase of the silver
see proper to exercise the authority, nor does there seem to be bullion whereby the bullion and all of it must be held in the
any necessity for its exercise at this moment,Sinless it be to pay Treasury as security for the payment of the notes issued. I do
current expenditures through the seigniorage, and that for this not find that trust in specific terms in the law. There is no propurpose he will be compelled to coin all the bullion in order to vision for its sale, and no one stated in the debate that it would
utilize the seigniorage, or that we shall give by statute addi- or could be sold. I find in the phraseology employed only the
tional power whereby $55,000,000 of coin may be created out of declaration that a specified portion should be coined within a
the surplus which arises from the purchasing price of the bul- given time, and the remainder to be coined in the discretion of
lion as compared with its coinage value in advance of the coin- the Secretary oi the Treasury; that no greater or less amount of
age authorized by the act of 1890.
the Treasury notes so called "shall be outstanding at any time
I do not agree with some Senators as to the construction of the than the cost of the silver bullion and the standard silver doloriginal Sherman act. Its history is perhaps familiar to every lars coined therefrom," thus limiting the total amount of TreasSenator on this floor. The Sherman act was a compromise, as ury notes which should at any time remain in circulation, this
Coinage of Silver Bullion.




clause being only a limitation upon the quantity of such notes,
and not a pledge for their redemption.
That provision was in the original Senate bill. It was a part
of our plan and scheme, which wasreported by the*Finance Committee to the Senate. I may- be mistaken in my construction; I
may have a different idea from others who participated in this
legislation, but that was a declaration limiting the issue of the
Treasury notes, which were to have special qualities not obtaining or belonging to any paper issued in the United States except
those notes. When the compromise act was agreed upon, it appears in two places that provision was made for the redemption
of those notes. In the second section it. is provided—
That the Treasury notes issued in accordance with the provisions of this
act shall he redeemable on demand, in coin, at the Treasury of the United
States, or at the office of any assistant treasurer of the United States, and
when so redeemed may be reissued.

But it appears that those who finally framed the law were not
satisfied with that declaration of redemption, and the following
provision is found later in the same section:
That upon demand of the holder of any of the Treasury notos herein provided for the Secretary of the Treasury shall, under such regulations as ho
may prescribe, redeem such notes in gold or silver coin, at his discretion,
It being the established policy of the United States to maintain the two metals on a parity with each other upon the present legal ratio, or such ratio
as may be provided by law.

And the last clause was not in either bill as originally passed,
but was intended to take the place of the provision in the House
bill for redemption in silver bullion at its value in gold.
This was regarded by some as an essential and by all as an
important and a vital addition, intended to give additional
strength to the provision before inserted in the same section for
the redemption of the Treasury notes in coin, and was a part of
the compromise between the two Houses.
Mr. STEWART. What effect did the third section have in
that connection?
Mr. ALLISON. I will state to the Senator from Nevada that
I am just about to deal with the third section.
Mr. STEWART. I shall be glad to hear the Senator on that
Mr. ALLISON. The third section of the law of 1890 undertook to deal with the bullion. While the second section deals
with the notes that aro to be issued, the third ppq^'iap deals
with the result of the purchase. What is it?
Mr. STEWART. It deals with the notes too; it deals with
the whole subject.
Mr. ALLISON. The Senator from Nevada will see later on
the distinction I desire to make, if I have not already made it
clear. The third section provides—
That the Secretary of the Treasury shall each month coin 2,000,000 ounces
of the silver bullion purchased under the provisions of thi3 act into standard
silver dollars until the 1st day of July, 1831—

That is a mandatory provision. There is no discretion there
vested in the Secretary of the Treasury, either as respects the
amount of bullion to bieused or the number of coins to be issued,
or the time who ^ they are to be issued. As I have said, that is
a mandatory provision. There were perhaps two reasons why
that provision was inserted. One was to make it mandatory
that a certain amount of silver should be immediately put in
the Treasury for the purpose of redeeming these notes; and secondly, probably, for the purpose of continuing the mints at .least
for another year in the prosecution of the coinage.
Now, having thus provided a mandatory provision for the
coining of a portion of the bullion, the section continues:

Mr. ALLISON. Very well; it may be so interpreted, and *I
think fairly so.
Mr. STEWART. I wish to ask a' question for information.
Have not silver certificates been issued on all that has been
coined, or is there some in the Treasury yet?
Mr. TELLER. There is some in the Treasury yet.
Mr. ALLISON. I understand that no silver certificates have
been issued upon the silver that was coined under the provisions of the third seotion.
Mr. STEWART. There has been nearly $7,000,000 issued.
Mr. ALLISON. That is the seigniorage.
Mr. TELLER. Yes; that is the seigniorage.
Mr. ALLISON. All the silver coined under the law of 1890
has attached to it what is denominated in the pending b ill as
seigniorage, which seigniorage is the residuum that remains after
the difference between the bullion value in the market and the
coin value at the mint is found. The difference, not the seigniorage, is found the moment a pound of silver bullion is purchased, because the moment a pound of silver is purchased the
number of grains in the pound and the number of dollars in silver that the pound of silver will create, are just as well known
as after it is coined.
Mr. MILLS. And how much was paid for it?
Mr. ALLISON. And how much was paid for it. The residuum is the seigniorage contemplated in the bill, which seigniorage arises under existing law when the silver is coined, and not
Mr. STEWART. And they are issuing certificates now on
the seigniorage.
Mr. ALLISON. They have a perfect rigjht to do so upon the
bullion already coined, because that seigniorage by the terms
of the law is covered into the Treasury as money, and therefore
is a part of the money of the Treasury, and can be used, and
when used silver certificates may be issued upon the deposit of
the resulting coins.
Mr. MITCHELL of Oregon. Is not the exact amount of seigniorage known before the silver is coined just as well as afterwards?
Mr. ALLISON. We know the amount, of course, as it is the
difference between the. purchase price and the dollars coined at
the mint.
Mr. P L ATT. But it is not seigniorage until the coinage takes
Mr. ALLISON. It is not seigniorage until the coinage takes
place as a matter of course, became seigniorage is clearly defined in the statutes and is perfectly well understood.
Mr. PALMER. I should like to ask the Senator from Iowa
if he understands that the whole mass of silver purchased stands
pledged for the redemption of the Treasury notes issued for its
purchase to only a specific amount of the coinage value?
Mr. ALLISON. When we speak of a pledge I understand we
speak of a thing; that is segregated, set apart, and devoted to a
particular purpose. Now, this purchase of bullion is defined in
the second section, and in the third section as respects what is
to be done with it.
Mr. PALMER. I understand the Senator from Iowa holds
that the Treasury notes issued in the purchase of bullion rest
upon the credit of the Government, and are to be paid by the
Government, and that the bullion purchased constitutes no security or pledge for the redemption of the notes?
Mr. ALLISON. When the Senator says *4 security of course
he reaches another point which I have not yet discussed. I
was speaking of the segregation of the bullion in the Treasury.
I have now stated what I understand to be the position of this

and after that time he shall coin of the sliver bullion purchased under the
provisions of this act as much as may be necessary to provideiqr the redejnption of the Treasury notes.herein provided for.

Mr. ALDRICH* Will the Senator from Iowa allow me to ask
him a question?
Mr. ALLISON. Certainly.
Mr. ALDRICH. Does the Senator think any further coinage
of silver at this time is necessary for the redemption ol those
notes in silver coin?
Mr. TELLER. It was a command that he should coin just as
much silver as the notes were put out.
Mr. ALLISON. In answer to the inquiry of the Senator from
Rhode Island I will say I do not think so, but neither am I prepared to say that that was the intent and purpose of the framers
of the law, as derived from the language I have read, although
I have no doubt that was in the mind of most of the men who
framed it, and it may be construed, I think, either to include all
or only so much as may b3 necessary. It is ambiguous in that
Mr. TELLER. I should like to ask the Senator from Iowa if
the clear interpretation of that language is not that it was a
command that the Secretary of the Treasury should coin the
bullion, not what might bs called for, but an amount equal to
the Treasury notes which were issued? That is what, it means.

and the dollars coined therefrom.
Mr. ALDRICH. Will the Senator from Iowa allow me?
Mr. ALLISON. Certainly.
Mr. ALDRICH. I understood the Senator from Iowa to say
in the commencement of his remarks that he believes the Sec*
retary of the Treasury now has the right under the act of 1890
to coin the bullion which remains in the Treasury*
Mr. GEORGE. Fifty-five million dollars?
Mr. ALDRICH. No; the whole of it.
Mr. ALLISON. Including the $55,000,000.
Mr, ALDRICH. Now, has the Secretary of the Treasury
any right, unless he believes in the exercise of his discretion
that it is necessary, to coin the bullion for the redemption of
Treasury notes?
Mr. A&LISON. Probably not, or at least he does not choose
to exeroise it without some further legislation.
Mr. TELLER. I think he has the right.
Mr. ALLISON. The clause is open at least to the construction that he can, if he chooses, coin all. He can coin a silver
dollar for every dollar of Treasury notes in circulation, if he so
interprets his authority, as the discretion is given to him.

Mr. SQUIRE. Will the Senator from Iowa allow me to ask of public expenditures." This money thus coined and the silver
certificates issued thereon do not go into the Treasury. It is
him a question?
the duty of the Secretary of the Treasury to use these coins for
Mr. ALLISON. Certainly.
this only purpose or practically by implication for this only purMr. SQUIRE. As a matter of fact, can the Secretary of the
Treasury redeem the Treasury notes in anything else unless pose. Was ever b3foro a law so prepared? Have wo ever in
any statute declared that a fund in the Treasury should ba set
this bullion were coined?
Mr. ALLISON. As a fact, the Secretary of the Treasury can apart only for a single purpose, that is, the payment of public
redeem those notes out of any means of redemption he has in expenditures, and that it should bo used, and the Secretary of
the Treasury, and it is so expressly provided. 1 have read the the Treasury should exercise no discretion as to the kind of
section regarding the redemption of the notes. The redemp- funds he pays for public expenditures?
Under the first section of the proposed law if the quarterly intion of the notes is, in the discretion of the Secretary, in coin in
thefirstclatise and whether of silver or of gold in the last clause, terest on the 1st of April, if you please, should become due, is
he not obliged to use the silver certificates and the silver dolboth of which I have read.
Mr. LINDSAY. I should liko to ask the Senator from Iowa lars in payment of interest upon the public debt, thus discrimiif under the management of the Treasury Department any of the nating, if I may use that term, as respects thesa expenditures
Treasury notes have been regarded as finally redeemed so as to against every other fund in the Treasury, and in favor of this
one, which is not in the Treasury at all by the terms of the probe retired unless they have been redeemed in silver?
Mr. ALLISON. Thave no doubt they could not be redeemed posed statute? . That is my first objection to the praseology of
the pending'bill, that it creates a special fund which never goes
in any other way than in silver if they are to be retired and canaccord with the forms
celled, a portion of the silver bullion having been coined, because into the Treasury inessentials to put money of law which we prenecessary
in the Treasury.'
there is a restriction upon the Secretary of the Treasury that scribe asin the next place, without fear of successful contradic^ Now,
he shall at no time have in circulation an amount of the notes tion, I maintain that the first section authorizes the Secretary
in excess of the original cos t and the coined money. Therefore,
to issue $55,000,000 of
when he redeems the notes in silver he is bound to retire them, of the Treasury in upondiscretion not only upon dollars that are
dollars or
as I understand the law. When he redeems them in gold -he can silvercoined, but he can coined discretion exercise the power to
to be
in his
reissue them, and I suppose he has reissued them.
issue $55,000,000 of silver certificates upon no dollars at all.
Mr. DOLPH. And upon no other security or deposit.
Mr. ALDRICH. I am sure my colleague on the committee
Mr. ALLISON. And upon no deposit and no security. The
does not wish to be misunderstood. By reading the plain pro- money which we authorize him in this bill to pay out at his own
t visions of the law I think he will find that the notes must be, or discretion is to go into the great volume of silver certificates
' may be, in the language of the law, reissued under any circum- which are now in circulation and which have actual coined dolstances.
lars bshind them, without any coined dollars in the Treasury
Mr. PL ATT. There is no distinction as to gold or silver*
representing them.
Mr. ALDRICH. There is no distinction as to whether they
Mr. DAVIS. A double issue?
are redeemed in gold or silver. There is no such thing as a final
Mr. ALLISON. A double issue. Now, the Secretary of the
redemption in the sense in which the Senator from .Kentucky
alludes to it. Redemption is simply exchange for other purposes Treasury is authorized to coin $55,000,000. The amount of
seigniorage, as it is called, which is the difference between the
as money and their reissue from time to time.
Mr. HOAR. I should like to inquire of the Senator from Iowa coin value and the purchase cost of the bullion, is named in the
whether the word " redeemed " in the second section is used in bill. I have read the bill up to the point where it requires the
Secretary of the Treasury to use these
any otjierwnse than the word " redemption" in the third sec-« issued upon them for a single purpose.dollars or the elsa can he
Now, what
Mr. ALLISON. Yes, it is. I think I can point the distinc- do under this section?
The Secretary of
tion out. The first question is the amount of th© notes that can Treasury demand ithe Treasury may, in his discretion, if the needs of the
tbe issued. That is provided for as respects the purchase. Now,
Do what?—
when that is done the Secretary of the Treasury is bound to have
no more and no less of the notes in circulation than the cost of issue silver certificates in excess of such coinage.
When? Ordinarily and manifestly that means when the $55,the bullion before any was coined. When the silver is coined
there was attached to it the other provision, that the note3 000,000 is coined, and not before. After he has gone on and
should never be any greater or any less in amount than the cost issued these certificates and executed this coinage of $55,000,of the silver bullion together with the silver coined therefrom. 000—that is the first imperative provision—then he may go on
So if the cost of the silver bullion and the silver coined there- and issue $55,000,000 more. The latter clause is not exhausted
from together, by the redemption from the coins, would make after all the seigniorage is coined, but is still operative, and if
more Treasury notes, they must then be canceled or retired. If there were nothing else in the bill except what I have read he
it would make less Treasury notes the Secretary of the Treas- could issue silver certificates in his discretion to the limit of a
ury must reissue them. That is the plain and clear interpreta-: thousand million dollars, or without any limit, if the Treasury
needed it. That is as plain as the English language can make
tion of the law as I understand it.
Mr. PL ATT. Would if not always be a constant amount in it. Now, what is the limitation upon this unlimited authority?
Provided, That said excess shall not exceed the amount of the seigniorage
any event?
Mr. ALLISON. If that be true I have not examined that as herein authorized to he coined.
Mr. DOLPH. This excess.
point with care. Has the Senator from Connecticut done so?
Mr. ALLISON. This excess, which he can issue by the very
Mr. PLATT. I have not.
Mr. ALLISON. I do not think it would be a constant amount letter of the proposed law, after every dollar of the bullion is
in any event, because the moment you coin the silver bullion or coined—that is the amount of the seigniorage, that is in round
any part of it you create a certain number of dottnro wfeicfe are F numbsrs $55,000,000. The discretion is not confined to him dur>
to be accounted for, as well as the cost of the bullion itself not ing the process of coinage, and'by fair implication he ought not
yet coined, the coined dollars, together with the cost of the bul- to exercise it until every dollar is coined by tho very language
lion uncoined, always measure the amount of the Treasury notes of the bill, because when he undertakes to issue those certifito be kept in circulation. Now, I have detailed what I conceive cates in advance of coinage he issues them without positive auto be a fair construction of the act of 1890, at least as I- under- thority to do so, the theory of this provision being that he will
issue the certificates as the coinage is created, having a silver
stand it.
What is the thing we call seigniorage? It is clearly defined dollar in the Treasury when the certificates are issued.
It is said that this proviso limits his authority. How does it
everywhere where treated of in our statutes. It is that residuum which arises from coinage, and by the law it is twice a limit his authority? It limits it as to the amount, which is, in
year covered into the Treasury and made an asset of the Treas- substance, that he shall not coin more than $2 for one of every
ury. After taking out the cost of the coinage and, the expense, coined dollar there is to be placed in the Treasury under the
twice a year the remainder Is covered into the Treasury. That coinage of the seignoriage, so called. If Senators on this floor
are willing to vote the authority to a Secretary of the Treasury,
is seigniorage.
Now, we come to the first objection that I have to the phrase- to be exercised in his discretion, of issuing $55,000,000 of paper
ology of the bill. The bill provides practically that the $55,- money with no security behind it, no promise to redeem it, and
000,1:00 shall not bs covered Into the Treasury., As thefirstsec- no silver dollars surrounding it or deposited for it, then they
tion stands it provides that it shall ba a separate and distinct are willing to do what has never yet been done by the United
fund outside of and separated from «very fund in the Treasury, States; they will issue practically fiat money.
Mr. ALDRICH. Not a legal tender.
and that it shall be used for a single purpose—impliedly for
only one purpose, and that is that it shall be coined " and the
Mr, ALLISON. Not a legal tender, but receivable for cussilver certificates issued thereoa shall be used in the payment toms and other dues.



tainly they can not be. But when those notes do come in they
Mr. HOAR. Perpetual In the matter of time.
Mr. ALLISON. There is no limit of time. He may do it in are to be canceled and retired, and there shall be issued in lieu
one year, or in ten years if the needs of the Treasury require it. of them silver certificatas for the amount of the coin.
Mr. PLATT. Suppose they are paid in for customs?
If I were in favor of the general purposes of the pending bill I
Mr. ALLISON. It is the same.
should ^never consent to give my vote for the issuance of $55,Mr. PLATT. Then they are not subject to redemption?
(XX),000 without the deposit of an equal number of dollars, and
Mr. ALLISON. Whenever those notes get into the Treasury
without a particle of security behind it as respects silver or any
by any method they are to be canceled and silver certificate's
other thing.
Therefore, when I saw that this section was defective in this issued in lieu of them. Twenty-seven million dollars of those
regard I turned to see what possible defense there could be for notes came into the Treasury in a single month, largely for cussuch an extraordinary proposition at this time. I found that toms, as I can show from the statement of the Secretary of tho
the bill was reported from a committee to the House of Repre- Treasury. I shall not go into that, however, because I wish to
sentatives on the 3d day of February; that it was debated and dis- ask Senators why it is that they want to disturb thefinancesof
cussed elsewhere in ways which I need not speak of and that at our country as respects our circulating money by compelling a
the last moment of time a substitute was offered for the first total change of $153,000,000 from one kind of currency to antime embodying this provision, and that when a Representative other? What are the Treasury notes? They are greenbacks.
endeavored to construe the bill thus sought to be amended he Nay, they are not only greenbacks, but they have a quality that
wa5 shut down as by a knife in the middle of a sentence by the greenbacks do not have; they are receivable for customs, and
announcement that the hour had arrived when a vote must b3 greenbacks are not so receivable.
taken. So the bill as it came to us did not undergo the crucible
Mr. SQUIRE. Are not silver certificates receivable for cusof debate. It has never bsen discussed as respects these provi- toms?
sions. Here is a new provision inserted at the last moment. I
Mr. ALLISON. But the greenbacks are not.
presume I am in order when I say without any opportunity anyMr. SQUIRE. There is no change in that respect.
where for criticism respecting it, or amendment, or suggestion
Mr. ALLISON. There is no change in that respect. But
of amendment, or suggestion of explanation it came into this the silver certificates are not legal tender, and the Treasury
notes are. They are of the highest class of notes that the GovI need only say that there was a general desire in this Chamber ernment has issued. Now, is it because we want to degrade
that the measure should be got out of the way before we enter these notes, is it because we want to discredit them, is it beupon the long and tedious discussion of the tariff. But it so hap- cause we want to discredit any form of our own paper money
pened that some of us were called from this Chamber, as all of that we insist upon this rapid change of one form of paper for
us are called from it more or less every day. I happened to bo another certainly as rapidly as the silver can be coined?
called out for a moment. I came into the Chamber and found we
I do not agree with the Senator from Wisconsin [Mr. V I L A S ]
were operating under the third reading of the billand the power when he suggests or intimates that it might be wiser to retire
of amendment cut off, a thing which I submit has never before all these notes under certain conditions not named. Until we
been done in the history of the Senate Chamber since thedays of have some new and comprehensive system of currency which
itsfirstorganization until this moment in the way this was done, looks to the divorcement of the United States from the issue of
without general consent for its reconsideration afterwards, at- paper money, I am in favor of the maintenance of the greentention being called to it. The third reading cut off amend- back circulation, and I shall not cast any vote which looks to or
ment. I came in and inquired of a Senator whether the bill had in any way countenances the destruction of this circulation or
passed to its third reading, and he said it had.
any part of it. And yet that is what this bill proposes. I have
1 inquired of another Senator and he said it had not and, was still,no fear that those who liave^&speciai rogacd far tha g man back
subject to amendment. A t that moment the junior SenatolWom circulation will support the bill until that feature of it, at least,
Illinois [Mr. PALMER] came to a seat in front ol me and inquired is eliminated.
of the Presiding Officer whether the bill was open to amendNow, if I had my own way, I will say that I would rather folment. The Presiding Officer answered that it was not, that it low the lamented Senator Beck of Kentucky, who wanted silhad passed to its third reading, and thereupon I rose in my place ver certificates as fast as they came into the Treasury to be conand moved a reconsideration. I do not wishjbo go into the de- verted into coin certificates. If we are to make anew departure
bate and the discussion that preceded that moment of time. I can and upturn and upheave our currency in order that it may be in
only say that if any Senator on this floor desires to cut off debate absolute confusion, let us do it by regulating it so as to make it
in that way and by the sudden processes that were around us at sure that it is all upon an equality and that the farmer in my
that moment, the Senator from Nevada [Mr. STEWART] with- State, or in any State, who holds a silver certificate will not be
drawing his amendment, the Senator from Massachusetts [Mr. cheated in the end, if there is at any time to be a depreciation
HOAR] not knowing that it was withdrawn and asking for it3 of this form of paper money; that he shall stand upon an equalreading practically—if that is to be the way that bills contain- ity with the millionaires, whom we hear described so often, or
ing radical, inherent, and serious defects are to be pushed at least with the great bankers who have their reserves and who
through, then it is a new method of legislation in this Chamber. know how to segregate and assort money in order to secure what
So much for the first section of the bill.
they regard as the best.
Mr. GEORGE. May I ask the Senator a question?
If we are to go either at a slow pace or a rapid pace to a deThe PRESIDING OFFICER. Does the Senator from Iowa preciated currency, I want, when that time comes, that we Bhall
yield to the Senator from Mississippi?
lave in the hands of the farmers and the laborers and the meMr. ALLISON. Certainly.
chanics of this country as good paper money as is to be found in
Mr. GEORGE. Upon the whole, does the Senator from Iowa the banks. I want all our paper money to stand on an equality,
assert that the first section of the bill authorizes the issuance of and do not wish by implication even to degrade any part of it.
silver certificates beyond the amount specified, $55,000,000?
Mr. MILLS. Mr. Beck advocated coin notes, which is betMr. ALLISON., No; only $55,000,000 in excess of the SSSmij* ter,
000 to be coined.
Mr. ALLISON. He advocated coin notes, which is better.
Mr. PL ATT. One hundred and ten million dollars in all.
Mr. MILLS. Not certificates.
Mr. ALLISON. One hundred and ten million dollars in all.
Mr. ALLISON. Now, here we are rushing pellmell into a
If there is any other possible construction of that provision I can disorganization and a reorganization in part of our currency.
not see it.
I wish to call attention to another provision in this bill which
Mr. GEORGE. The position of the Senator from Iowa is that is ambiguous, to say the least, and which will lead to great con$110,000,000 of certificates may be issued on the seigniorage of fusion in the redemption of the Treasury notes, and may require
them to be redeemed in silver only.
I will read the provision:
Mr. ALLISON. It is, and I have no doubt of it.
Now, Mr. President, as respects the second section of the bill,
That as fast
bullion shall
for the redemption of said
the Senator from Wisconsin [Mr. VILAS] has argued at great notes, the notesas thenot ba reissued be coinedbe canceled and destroyed lu
but shall
lengtn one phase of that section which I will speak of only briefly. amounts equal to th9 coin held at any time in the Treasury, derived from
The second section of the bill provides for the coinage of the re- the coinage herein provided tor, and silver certificates shall be issued on such
siduum of the silver; that is, of enough of the silver to make a coin in the manner now provided by law.
silver dollar for each Treasury note in circulation. That is the
This provision may, in its terms, require that hereafter these
first thing to be done' by the second section. If I were to criti- notes shall be redeemed either in silver or, if in gold, operate so
cise it closely, I could criticise that phraseology also. I read it: as to contract the volume of paper money. It provides when
That as fast as the bullion shall be coined for the redemption of said notes these notes come into the Treasury silver certificates shall be
the notes shall not be reissued, but shall be canceled.
issued on such coin in the manner now provided by law, i. e., upon
Suppose they are not in the Treasury? How can those notes the deposit of silver dollars. This limitation as to the deposit
be dealt with until they have come into the Treasury? Cer- of silver dollars is not in the first section. Now, if the notes

shall be redeemed in gold, the silver remains in the Treasury of the Government at any period to sell this bullion or any part
and certificates can not be issued, butthe notes must be canceled. of it. Therefore, it must be coined sooner or later, and I am in
The Secretary, I have no doubt, cbuld use these silver dollars in favor of coining it under favorable conditions and with proper
payment of expenditures, and would be compelled to do so in or- limitations as respects the currency flowing from it. I was
der to lay the foundation for the issue of certificates. This is an willing that it might lie there for a time until we could see
indirect, if not a direct, method of forcing the Secretary to re- whether there could be some international or other arrangedeem the Treasury notes in silver whether he wishes to or not, ment as respects the ratio at which It should be coined, etc.,
because without going into the question of ratio (and I do not
in his discretion.
What is the haste for the passage of the second section of this intend to do so) I have the belief that when silver is restored to
its original position as part of the world's money in full use, as
"bill? By its own terms, ex propria vigore, it can not begin to be
executed for eighteen months or two years. There is no pre- I believe it will be restored at no remote period, the ratio will
tense or pretext that you can coin more than $3,000,000 a month not be our ratio of 16 to 1, but it will be the ratio of the world's
at our mints, using the mints at their utmost proper capacity silver practically, 15£ to 1.
I believe that if this was to come in the near future, inasmuch
for coinage, which will require eighteen months in round numbers, or nineteen months, to coin the $55,000,000 of the seignior- as we have $153,000,000 of this money out in the form of Treasage, so called. Yet, although nearly two years are to intervene, ury notes representing the bullion, we could well afford to lie
we are to pass a species of legislation which will bind us hand still for a brief period, at least as respects the settlement of the
and foot and put gyves upon our wrists as respects this whole coinage as a measure, and we need not at this moment fret ourquestion of coinage and currency derived therefrom, although selves about it. But here comes, I may say thrown upon us, a
within two years we may feel that it is of the utmost importance position where we can not even amend the bill, where we can
that we should make some other change as respects this whole not, with all its defects, cross a " t " or dot an " i " in it under
our rules, with no necessity for its passage at this moment withquestion.
out consideration as respects its amendment, if at all, unless SenMr. SQUIRE. May I ask the Senator one more question?
ators will say that our Treasury is bankrupt, which they can not
Mr. ALLISON. Certainly.
Mr. SQUIRE. The Senator remarked that the Treasury say.
Mr. .MITCHELL of Oregon. May I ask the Senator from Iowa
notes are more valuable than silver certificates because they
are a legal tender, in addition to having the quality of being one question before he sits down?
Mr. ALLISON. Certainly.
receivable for customs duties. I wish to ask him, in view of that
Mr. MITCHELL of Oregon. The Senator from Iowa, I prefact, as he says that the money changers, the bankers, have the
sume, rests his argument that the bill authorizes a double issue,
knowledge requisite to enable them to assort the various kinds
or twice $55,000,000, upon the use of the word "excess " in the
of money, is it not probable that the Treasury notes would be
kept out of the Treasury, would not get into the Treasury, and first line of the proviso to thefirstsection. Does not the Senator
that other money would be used in making payments of duties believe that a court in construing the bill, taking into considerato the Government? The Treasury notes having a superior tion not merely the literal words of the proviso, but the whole
quality, being legal tender, is it not probable that they would scope and purpose of the bill, as apparent on the face of the bill
itself, the purpose being simply to transfer from bullion into
be kept in the hands of the men who assort money?
Mr. ALLISON. Possibly that might be true, but if that be coin the seigniorage, in the first place, and issue certificates on
true then why deal with this question now. That is only an that, and, secondly, as rapidly as possible, transfer the remaining bullion into coin and issue certificates, replacing the legalargument, I take it, in support of what I am about to say.
tender Treasury notes issued under the Sherman law by certifiMr. ALDRICH. We might have another issue then.
cates, looking at the law in that light, having evidently
Mr. ALLISON. We might have another issue then, but purposes and none other, would not any court construe the these
there is a difficulty that lies in the pathway. By this legisla- 44 excess M there to mean certificates? In other words, would not
tion we purposely discredit the silver certificates. We could the court, taking into consideration the whole bill from begindo no more to discredit them if we put a brand upon them, and ning to end, hold that that proviso should
said, "Here is money that is not as good as other money," be- certificates shall not exceed the amount of be read" that said
the seigniorage as
cause by legislation we shall have compelled the best paper
money that there is in circulation to be discarded and destroyed herein authorized to be coined."
Mr. ALLISON. Manifestly not, Mr. President. The truth
in order that we might issue these certificates.
Will it not be said that this change is made because of the is that the Senator from Oregon gathers the meaning of the bill
qualities inherent in the Treasury notes and not found in the from his own intellect and not from the bill itself. There are
three purposes in the bill. One is to issue $55,000,000 upon the
substituted certificates?
So, Mr. President, finding no fault with the policy which de- seigniorage, so called; another is to issue $55,000,000 without
clares that this seigniorage, so called, is not a trust fund, and anything added to it, and another is to coin the remaining bulbelieving as I do believe that we have a right to deal with it, I lion and withdraw Treasury notes and issue silver certificates inam utterly opposed to the complicated method provided for in stead.
Mr. MITCHELL of Oregon. I admit the literal meaning. I
this bill as it now stands. Without fear of contradiction, I say
that there has been no opportunity to debate it anywhere in the admit that if you follow the letter it means what the Senator
United States with a view of proposing amendments; and yet says, but I do not think any court would give it that construcwe are to run it through here with the second section, which tion.
Mr. ALLISON. Let me read the language so that there will
can not take effect for eighteen months or two years, in order
that we may discredit at this moment a portion of the paper be no mistake about it. What is the provision of the bill?
And such coinmoney of our countryWhy are we undertaking to do this? What is the emergency
That is, all this coin—
and what is the haste? You must remember when this bill was or the silver certificates issued thereon, shall bo used in the payment of public expenditures—
first introduced (and it was introduced apparently to get rid of
the necessity of borrowing $50,000,000) it was intended to be a* Is not that clear? Is not that purpose apparent? Now, what
panacea and a soporific which would tide over the peril in our next?
Treasury for some time at least; but it came so slowly in its and the Secretary of the Treasury may. In his discretion. If the needs of
consideration that the Secretary of the Treasury, believing it the Treasury demand It, issue silver certificates in excess of such coinage.
I want to ask the Senator from Oregon, who is a good lawyer,
was necessary to maintain the public credit and provide for current expenditures that he should have a large sum of money, familiar with the construction of statutes, if the phrase that I
made a loan of $30,000,000, although this was not done until after have read exhausts itself when this $55,000,000 of silver is coined?
the bill was introduced, and introduced, as it was supposed, for Is there not a living, positive provision hero after every dollar
of that money is coined? I leaye that to any lawyer to decide
the purpose of makings it unnecessary to borrow money.
Now, it may be that the emergencies upon the Treasury are for himself.
Mr. HOAR. I should like to ask the Senator from Iowa a
so great and the necessities are so great that in addition to the
$50,000,000 we must have $55,000,000 more, or $110,000,000 more, question.
Mr. ALLISON. Certainly.
immediately, as authorized by this bill. If so, then there may
be excuse for this haste. If not so, then there is no excuse
Mr. HOAR. I understood the Senator's argument to be that
for it.
the $55,000,000, whatever the amount may be, is to be duplicated,
This bullion is slumbering in the Treasury and it can slum- and that for the last half of that duplicate in amount there is no
ber there until we can get some comprehensive and sensible obligation for redemption of any sort.
method of dealing with it, or at least until we can amend the
Mr. ALLISON. No obligation other than that redemption
pending bill. I am ready to deal with it now, if need be. I which will come from its receipt for public dues and public payhave never believed that any portion of the bullion would be ments, because they are to be silver certificates without coin in
sold. I do not believe that it would be wise policy on the part the Treasury as the law requires.



Mr. HOAR. What I "want to understand is whether the
Mr. TELLER. Why?
phrase "silver certificates," in this proposed legislation, does
Mr, ALLISON. It has dwindled because of a variety of
not derive its meaning and the obligation which it imposes upon reasons which I shall not undertake at 5 o'clock to go into. It
the Government from the act to which it is an addition, and has arisen from a variety of causes, which we will have enough
therefore, when the act of 1890 has declared that the Treasury time to debate and in which I do not greatly disagree with the
notes, which are in fact silver certificates,:shall be redeemed in Senator from Colorado as respects one of them, the degradation
gold, or silver, at the discretion of the Secretary of the Treas- of our silver as money. Here are $11,000,000,000 less exchanges
ury, although there may be no silver deposited for this particu- in the eleven months last past than in the eleven prior months.
lar issue, does not the obligation still rest upon the Department? Now, it can not be that we must have as much currency to carry
Mr. ALLISON. By no moans, because Treasury tnotes are on two-thirds of the business of our country as we required a
contemplated and provided for in the original act of 1890. These • year ago to carry on the whole of it. I only allude to this for
issues proposed are silver certificates, and therefore they have the purpose of stating that for the single purpose of the enlargeno means of redemption, unless there is silver behind them in ment of the currency of our country there is no pressing necescontemplation of law.
sity for such a measure as this, because our currency, as comMr. HOAR. Are not silver certificates provided in the law pared with what it was a year ago, is one-third more as respects
Of 1890?
the amount of business transacted.
.Mr. ALDRICH. They are not silver certificates; they are
Mr. STEWART. Does the Senator believe that if the curTreasury notes.
rency of the country is reduced business should be reduced to
Mr. ALLISON. They are a different kind of notes. I repeat, correspond with the currency? Would he make the currency
the provision which I have read is a substantive provision— fit the business?
after every dollar of this money has been coined—and there can
Mr. ALLISON. The Senator asks me that question, knowing
be no doubt as to the effect. Therefore, the proviso at the end perfectly well that I do not wish to do either. The existing disof the section is a limitation upon the last clause, and not a lim- tress in our country does not arise wholly from any one cause,
itation upon anything else.
but it arises from a variety of causes. That distress began in
Mr. President, I do not share with the view expressed by the 1893, and it continues to this hour, and no panacea that he or I
Senator from Wisconsin and others in this debate as respects could offer will restore it within the next two years.
our ability to maintain specie payments upon our present standMr. STEWART. It can be restored in three months.
ard of money ; and a word upon that point at this time. I regard
Mr, GEORGE. And no part of the distress comes from a deour ability to maintain at par all our currency as resting upon ficiency in the amount of the currency? Is that the Senator's
the total amount of gold coin in our country as well as in the position?
Treasury, and that ability will not be seriously disturbed except
Mr. ALLISON. I am speaking of the volume of paper money
"by means of the balance of trade running against us, requiring : in the United States. I am not speaking of that great and large
large asportations of our gold. We have here a Treasury state- question of the money of the world, or of the destruction of the
ment (already alluded to by the Senator from Wisconsin) of the; silver and the attempted destruction of one-half of the money Ol
situation as respects our currency and our metallic money on the • the world. I know perfectly well, and "believe, and have often
1st day of March. It is shown that in round numbers we had in i stated on this floor, that, if you strike down one-half of the methe United states on the 1st day of March, 1S94, $527,000,000— tallic money of the world you must in the nature Of things reI only speak inround numbers—of gold coin, of which there was duce prices to a corresponding extent. But I am speaking of
in the Treasury on the 1st day of March, as stated by the Sen- the paper money that we have for local circulation in the United
States as having been regarded as sufficient two years ago, and
ator from Wisconsin, $107,000,000.
Mr. PL ATT. Over and above that held for gold certificates. if our currency then was sufficient for business nooda, certainly
Mr. ALLISON. Over and above that held for^^tTOrtferaff^ Wis sufficient now when wo have only two-thirds of -the volume
c&tes; whilst on the 1st day of February, although there was as of business we had then.
Mr. GEORGE. I understood the Senator to say that we had
much money in the country practically as there was on the 1st
day of March, there was in the Treasury at that date only about a third less currency now than we had a year ago. and that we
$68,000,000 available in the same connection. In other words, £ad enough then to carry on the business of the country?
Mr. STEWART. There is one-third less business now.
during the month of February the Secretary <of the Treasury
Mr. ALLISON. We have largely increased our currency in
made a negotiation of §50,000,000 which yielded to the Treasury
858,000,000 of gold in a single month, without increasing the the last vear and the volume of business has largely diminished.
total coin of the United States apparently, and without disturb-j Mr. GEORGE. I understood the Senator to say that there
ing the financial situation in our country. That is to say, there; was no need for an increase of the currency.
Mr. ALLISON. The Senator does understand me to Say that
was this change of, inround numbers, 850,000^000from circulation into the vaults of the Treasury without any apparent dis- merely for the purpose of securing circulating money to carry
on the ^existing business in the United States there is no pressturbance in our financial situation.
Now, what does that show? It shows that we are strong as ing necessity for this measure. Why? Because our business
respects our gold. We hold to-day,as shown by this statement, is one-third less than it was a year ago, and we have nearly
one-sdxtho? the gold money of the world, although we have less 5100,000,000 more money in circulation now than we had a year
than one-eighteenth of the population;. Therefore there is no ago. That is all I mean to say.
Mr. GEORGE. Then the opinion of the Senator is that the
danger, under existing conditions, as I believe, to our paper
money, as respects its depreciation in its existing volume, unless volume of money in the United States is amply sufficient for the
that dagger shall come by means of an adverse balance of trade; business of the country?
Mr. ALLISON. By no means. I mean to say that the things
and, being interested as the Senator from Wisconsinseems to be
interested strongly in behalf of maintaining existing conditions which have disturbed us in the past, and which are disturbing
in this regard, I would discourage for myself any change of our us now, are the impediments which have been and are put in the
statutes, whether they, be tariff-statutes, or otherwise, which
of ilia business oE tha country, and are causing the disi
would endanger this balance of trade, and which will compel us tress, and not a present lack of currency. What I mean to say
to export gold in addition to what we export, of other things to is that no little additional amount of paper money will restore
meet an adverse balance of trade.
business in our country to its normal status, that it needs severer
The fact that we are making, or proposing to make, radical medicine. I will say to the Senator, than the homeopathic dose
changes in our tariff laws, may and probably will precipitate which is " proposed "in this bill in the hope that it may in some
this adverse balance.
degree alleviate our situation.
Mr, STEWART. What severer medicine would the Senator
The danger as respects our gold payments lies no t in any little
incident as respects our circulation, although I believe they will recommend?
be endangered by this bill unless it is amended in material reMr. GEORGE. Then, the proposition of the Senator from
spects. I believe it would be a direct blow at the stability of Iowa is that the addition proposed by this bill is so small that it
our currency to pass the bill without amendment, hut with will not do any good; that we need a larger addition. Is that
amendments such as I have suggested I do not believe it would the idea?
have that serious effect.
* Mr. ALLISON. Ko, sir, that is not my position at all. I will'
But this manipulation of the Secretary o! the Treasury in the say to Senators now that they can not get me into that debate—
month of February discloses another thing, and that is that we and 1 have especially avoided the debate—of the larger question
do not at this moment need additional currency in the United about silver and gold, and the large question of disturbing our
States—1 mean for circulation. The Senator from Colorado industries and labor "by tariff changes. I believe in the restora[Mr. WOLCOTT] takes my statement literally. In 'Other words, tion of-silver, as does the Senator from Mississippi. I belie ve
we have a sufficient circulation in the United States for our pres- in so restoring it as that its restoration will be permanent. 1
ent business. The amount of business in our country lias dwin- believe in an ample and proper supply of money for our own
dled one-third in the last year.
country. If we had a prosperous business situation, as we should

have, if we were enabled to secure work for all our people at fair
wages, tliat would bring a demand for additional currency, but
that demand is not to-day or to-morrow or next week under the
depressing conditions of to-day, which will be more depressing
as the days and the weeks go by. Having pointed out the imperfections of this bill, and only some of them, which I regard
as serious objections to its passage, I have made the motion to
reconsider in order that proper amendments may be proposed
and considered by the Senate, and if such opportunity is not
given, I can not give the bill the sanction of my vote.
For convenience of reference, I append a copy of the bill to
my remarks:


other purposes," to the amount of the gain or seigniorage of such bullion,
to wit; The sum ot $55,156,081, and such coin or tho silver certificates issued
tbereon shall be used in the payment of public expenditures, and the Secretary of the Treasury may, in his discretion, if the needs of the Treasury demand it, issue silver certificates in excess of such coinage: Provided, That
said excess shall not exceed the amount of the seigniorage as herein authorized to be coined.
SEC. 2. After the coinage provided for in the first section of this act, the
remainder of the silver bullion purchased in pursuance of said act of July
14,1890, shall be coined into legal-tender standard silver dollars as fast as
possiblo, and the coin shall be held in the Treasury for the redemption of
the Treasury notes issued in the purchase of said bullion. That as fast as
the bullion shall be coined for the redemption of said notes the notes shall
not be reissued, but shall be canceled and destroyed in amounts equal to the
coin held at any time in the Treasury, derived from the coinage herein provided for, and silver certificates shall be issued on such coin in tho manner
now provided by law: Provided, That this act shalL not be construed to
Be it enacted, etc,. That the Secretary of ftie Treasury shall immediately change existing law relating to the legal-tender character or mode of recause to he coined as fast as possible the silver bullion held in the Treasury, demption of the Treasury notes issued under said act of July 14,1890.
SEC. 3. That a sufficient sum of money is hereby appropriated to carry
purchased under the act of July 14, 1890, entitled, "An act directing the purchase of silver bullion and the issuing of Treasury notes thereon, and for" into effect tho provisions of this act.