Madison, Wisconsin
September 10th, 1878


I would like in opening the few remarks I have to make this afternoon, if I felt that I could safely do so, to undertake to catalogue the various advantages and attractions possessed by Wisconsin and the city of Madison. But we have seen so many, and heard of so many others we have not seen, that the catalogue would be unreasonably long. I assure you, however, that all who are traveling with me, if I may judge from the expressions I have heard, are all sufficiently impressed by the very great advantages of your great state, and with the superior advantages of your beautiful capitol city.

We know something of the benevolent institutions of your state--so honorable to its people. We can see this prosperous and growing university, and the beginning of an observatory there, as we are told, thanks to the enlightened liberality of a citizen, Gen. Washburn, who has the good fortune, as well as the wisdom, to see that his public benefactions are properly distributed in his lifetime.

When I started upon this visit to the northwestern states, to be present, as I knew I should be, at several agricultural and some of the mechanical fairs of this part of the United States--organizations established in the interest of the material prosperity of the country--it occurred to me that, if it were possible, I ought to try to say something that should advance and promote the material prosperity of the country, not expecting, not even hoping, that much could be done by any words of mine; but it did occur to me that after five years of business stagnation and depression throughout the country, the time had come when words of encouragement, to give increased confidence to those who already have confidence, and a greater hope to those who already are hopeful, would be fitting and proper.

Now, my friends on this general subject my occupations have naturally let me to consider the condition of the Government and of the burdens which, by reason of the Government, rest upon the capital, the business, and the labor of the country; and, if I could demonstrate to the people of these States that, notwithstanding the depression of the times, these burdens have been made lighter and lighter during these years since the close of the war, it seems to me that it would be doing a useful thing; and I therefore invite you to attend for a moment upon a course of remarks which I pursued at St. Paul and at Minneapolis, said to which I shall add something not said there, "bearing upon the general proposition that there has been great improvement and great progress in lifting burdens from the people in the last thirteen years, and especially in the five years since the panic; and in doing this, my friends, do not misunderstand me--I am not here even to refer to what has been done in that way during the short period of the administration which was inaugurated in March, 1877. The most of what has been done I think of in connection with such names as Mr. Hugh McCulloch, Secretary of the Treasury in Mr. Johnson's time and Gov. Boutwell, the Secretary of the Treasury in Gen. Grant's time.

When the war closed, it left us with many grave questions pressing for consideration and decision, and perhaps no more grave or difficult than that about the debt. The debt, as ascertained, was $2,757,000,000, and that in a country that had known almost no national debt at all, and the actual debt was more than that, for we owed to the soldiers that had not been paid; we owed for quartermaster and commissary stores; and the actual debt was not less than $3,000,000,000 thirteen years ago to-day. Worse than that; all nations in the war are compelled to borrow, and they are compelled to borrow at such rates as the men who have money to lend choose to ask. Our burden of interest on that debt was over $151,000,000 a year. For interest alone, we were paying, in 1865, after peace, double the expenses of the government in any year of peace prior to the rebellion. Well, now how are we? Fortunately, Secretary McCulloch did not regard a national debt as a national blessing, and he adopted the policy of reducing the debt, thereby strengthening the credit of the nation, and in that way enabling us to get our money at lower rates of interest, to refund the debt on better terms. Now, among the wise men of the country, through the press and upon the platform there were a number who told the people that that debt would never be paid--that great nations never paid their war debts; that it would be like debt of England and France--a burden upon us and our posterity for all generations. Hugh McCulloch and the people of the United States were fortunately wiser than that. They believed that the debt could be honestly paid according to its spirit and the letter of the obligations creating it, and they went to work, and from that day to this, every year has seen a material reduction of the debt; and to-day, instead of $3,000,000,000, it is only about $2,000,000,000--nearly one-third paid off in thirteen years.

By reason of improved credit, the interest of that debt has been changed until to-day, it is only $95,000,000 a year, instead of $151,000,000 a year. More than a third of the interest has been cut off. If we were to put into a sinking fund to-day, at four per cent. interest, the reduction of the rate of interest, it would pay the whole debt in less than twenty-five years. But that is not all. Every man in this community is not only relieved somewhat of the burden of that great debt, but all engaged in business, who have to borrow money, understand that the rate of interest that is paid by the Government of the United States influences, I might also say regulates, the interest that you are to pay. If the Government pays seven and three-tenths per cent, with such securities as Government bonds, none of you can get it for any less. Nay, it will be ten, twelve, or fourteen for the citizen; and when we get it down to four, that brings it down for every citizen borrowing money in the United States. In short, a good national credit means a good credit for the individual. Lower rates of interest for the Government mean lower rates of interest for business men everywhere.

But, again, in reference to this debt, only seven years ago, in 1871, it was ascertained, as near as such fact can be ascertained, that our bonds owned abroad amounted to from $200,000,000 to $1,000,000,000; that we were paying from fifty to sixty millions of dollars a year to go across the water; and now we have ascertained in the same way that those bonds have been coming back under the changed balance of trade, until to-day there is owned abroad only from $200,000,000 to $300,000,000. Instead of sending abroad each year $50,000,000 or $60,00,000, we send abroad only from $12,000,000 to $15,000,000. Now, that is the debt, greatly diminished, interest greatly diminished, owned at home instead of abroad.

Well, take taxation. When the war ended, the first year of peace, our taxes were $488,000,000 for national purposes. Custom duties and internal revenue duties amounted to $488,000,000. To-day they amounted to $240,000,000, an improvement of almost $250,000,000 in the taxes that burden the capital and labor of the country; expenditures the same, a diminution almost equally as great; and this decrease has gone straight on during the period of the panic.

Well, now take the other side. We have less debt, we have less taxes, we have greatly improved currency and exports and imports. Let us look at these two things just for a moment. Our currency thirteen years ago--bank note paper and greenbacks--amounted to six or seven hundred millions of dollars. It amounts to about that now. But then each dollar was worth 69 cents. To-day each dollar is worth 99 1/2 or 99 ¾ cents. Then our six or seven hundred millions of dollars was worth only about $500,000,000. To-day it is worth about six or seven hundred millions of dollars. But better than that: Then our currency was fickle, and it fluctuated in value from day today. We had Black Fridays, days when it went up; and then we had other days when it went down; and, now, what effect had that upon the plain people of the country--the producers and laborers, the middlemen? The men who buy and who sell, do it, if they have good sense, for profit. They understand very well that this fickle standard of value may be against them. They may buy at one price and sell at another, but the currency may vary in such a way as it makes it against them. Therefore they put on enough profit for the purchaser and laborer to pay to make up for the shifting standard of the value of currency, and at last the laborer of the country and the producer of the country pay for the fickleness of the standard. Now, how is it? We have brought the greenback, the National bank note, and all kinds of paper money to within a half to a quarter of a cent of the value of gold and silver, and there it sticks, steady as the level of your lakes. Why, in four months, in five months, the variation of the currency has not reached more than a fraction of a cent. Then we have a better currency.

But perhaps more interesting to you as farmers, is the condition of our export and import trade. For five years before the panic the balance of trade against the United States was $100,000,000. That is to say, we bought of those men across the ocean $100,000,000 more than we sent them, and balances have to be made up in cash. How is it now? Why, last year, the balance of trade in our favor was $257,000,000--more than ever before, and as an average for three years past, we gained between three and four hundred millions of dollars, as compared with the period next before the panic. And how does that come? Then we sent between two and three hundred millions of dollars of agricultural products abroad. We are sending living animals, we are sending bread and breadstuffs--that means wheat largely, and corn. We are sending leather. We are sending some manufactured goods never sent abroad before. We are beating them with our watches in Paris, and sending watch-works actually up to the shops where they make watches in Switzerland, because we do it better than they do.

We are gaining then, my friends, in this whole business between us and abroad. Now I am not here to discuss the question of the balance of trade--a very abstruse matter--economists differ about that. But there is one thing we do not differ about. It is a good deal better to have a hundred millions on our side than against us. That we understand, and that is the way it is to-day. Now the encouragement and the hope that I would draw from all these facts is that we are getting along to better and better times.

And on this journey of ours to the West we learned another fact that I had not got into my prepared budget of material when I left Washington, and that is this: East of the mountains there are a great many people out of employment, not half so many out of employment that really want to work as they pretend, but there are a great many. Now they said to us that all the good lands in the United States were taken up - there were no more left. "We have got now to support ourselves as they do in Europe, on what we have got." Well, we have been out there; we have been clear out there, nearly into the center of the American Desert; and right there in the center of that desert Mr. Dalrymple took us at a trot and a gallop in his buggy around for about an hour and a half through 13,000 acres of wheat field which had averaged, this year, twenty-four bushels to the acre of first class wheat, and that in the desert; and the land cost them, I am told, about one dollar an acre. Now what is the trouble? Is it that they have not room enough? The world has laughed a great deal at Mr. Greeley for a favorite phrase of his, "Young man, go West;" but Mr. Greeley was wiser than those that laughed at him. There is good sense in that. Every thousand people that go West make it just that much easier for those that are left at the East to get employment and when they get West they want furniture; they want every description of supplies, and they give just that more employment to the manufactures of the East. And that is not all. They go to work and they raise their twenty-four bushels of wheat to the acre, and help feed those men at the East, and so the movement of population that is now going to more rapidly than ever before in this country, to Texas in the South, to Kansas in the center, to Dakota and Minnesota in the North, is steadily helping us on to that period of better times of which I think we are now on the threshold.

And now, my friends, may I talk a little of my own convictions as to remedies that are proposed for these hard times? I do not like to mingle in mere partisan discussions, and I do not propose to, but I have some friends who tell me that, after all, our trouble is that our currency is not cheap enough, and that it will not stay at home. It goes abroad, and therefore they tell me that they want a currency that is so cheap that it is better for us than that costly currency, gold and silver, and of such quality that it will not go away. Now that is very desirable quality in currency. You have all found it so. If you can keep it, it is a good thing. Let us talk about that a little. First, the cheapness of the currency. They tell me what they wish is this: the United States ought to say, "This is one dollar anywhere in the United states, by act of congress"-- a piece of paper about the size of that probably: "Of course, we do not want to counterfeit it." I am afraid it would not be a great while after it was issued that nobody would want to counterfeit it. But, that in order that it should be as good on paper--the people are accustomed to good paper; they would have it look like a national bank note, or a greenback--good type, good-looking pictures on it, good engraving. And now, what does it cost? They say they want a cheap currency.

What does that "dollar" cost? About this size the paper would be. Now, if it is a gold dollar, or a silver full dollar, we know what it costs; and that is, it costs, take the world over, about a day's work; that is what it costs; it costs about a bushel of wheat; that is what each dollar costs. But now what does the new currency cost, each dollar? Well, they tell me it costs rather less than a cent; that piece of paper, all pictured off nicely, ready for currency, costs about a cent. Now that is a good operation. To make it out of gold or silver, it will cost us a bushel of wheat, or a day's work, but this costs only the one-hundredth part of a day's work, or a bushel of wheat. That is a good operation. "We will do that; we will do that." But stop! Is that best? Let us see. Why, it doesn't cost any more to make that "Two dollars" than "one dollar."

Then we were not a little hasty only to make it "one?" We will make it "Two," and it still costs only a cent. Now, my friends, don't you see that we made only ninety-nine cents on it before; now we make a dollar and ninety-nine cents? But if we would undertake to make two dollars out of gold and silver, it would take two days' work, or two bushels of wheat. But stop! are we right? Why it is just as cheap to make that "ten dollars." Let us make it ten dollars, then, and make nine dollars and ninety-nine cents in the operation. Instead of paying for it ten days' work or ten bushels of wheat, we will give just exactly the one-hundredth part of a day's work for our ten dollar bill. We are doing well; but not wisely, for we might just as well make it a hundred--it will cost no more; or a thousand--it will cost no more, and now we will pay off our whole national debt with it, and that is what we want, they tell us. Why stop at that? Why not pay all the expenses of our government with it, and not tax people at all? It only costs a cent for a hundred dollars or a thousand dollars, and then, Mr. Senator, or Mr. Representative, we will pay you easy, and somebody would turn on me and say, "Yes, Mr. President, and we will pay you off easy, too." Now, my friends, doesn't it begin to dawn upon the simplest mind that there is some mistake about this? That that is inflation and that inflation is nonsense? The real thing is what we want--no sham. But the friends say: "It will stay at home; it won't go abroad; good here, good nowhere else; therefore it will stay here."

Is that good? Let us see about that. Let us have the United States act upon this principle: none of our money will be taken abroad--and so we will keep it. If that is good for the United States, would it not be well for Wisconsin. Wisconsin sends her money to New York and to New England and the big cities East. Why not keep it at home? Let Wisconsin make her own money in the same way , then; now, if that is good for Wisconsin, why is it not good for Madison--not be sending off to Milwaukee and Chicago, and so on; let Madison make her own money; if it is good for Madison why isn't it good for John Smith, the grocer? Let him make his own money:

"This is one dollar. JOHN SMITH."

He will never spend it; he can keep it; it will stay at home. No, no, my fellow citizens, the men who made the Constitution of the United States said: "Congress shall have power to coin money." Gold and silver are the money of the world and have been ever since the days of Abraham, and you cannot change it by legislation. Either that, or paper that will command that, is a sound Constitutional currency. then, my first objection to this my friends, is, either to get your currency, you have got to change the Constitution of your country or violate that constitution of your country. Change it! When will you change it? Gentlemen have introduced resolutions into Congress to change it, thereby admitting that under the Constitution as Washington and the Fathers made it, they cannot do this--and so they want to change it.

Now, long before they can change it, the march of events will bring again the wheels of industry everywhere in motion, and a prosperous and happy country. Then, my friends, let us remember that with every day, more and more, our products of the soil and our products of the shop are going to Europe, connecting us with the commerce of the world. We should conduct our financial system, then, on principles and instrumentalities, such that the experience of the world and the general judgment of the commercial world will sanction our principles and our instrumentalities, and we know what that is. We know how the commerce of the world is bound together. We have the good fortune, my friends, to have here the gentleman [Gen. Myer, chief of the Signal Office] who, under the laws of the United States, has charge of the weather of the United States, and he tells us that this air that enwraps this globe is a unit, and that any great disturbance, any great commotion, anywhere on any sea or continent, sooner or later is felt on every other sea and every other continent; and so it is with the commotions and the disturbances in the commercial world. Anything seriously affecting any great nation, soon affects all the others. This panic that has affected us has afflicted others also, clear around the globe.

Now my friends, let me say; the true need is, when we are marching steadily on to the threshold of better times, to be wise and let well enough alone. What we want is a restoration of confidence. A restoration of confidence comes only with stability in legislation and in conduct. Let us then try no new experiments, but march in the path around marked out by the fathers. Let us say our restored financial prosperity shall rest upon a national credit unimpaired, without taint or stain, and upon a currency solid and constitutional--that defends no one. Let it be a currency such that honest capital, for there is honest capital, and plenty of it; that honest business enterprise, for there is honest enterprise; that honest labor; for there is honest enterprise; that honest labor, for there is honest labor, shall all have, alike honest money.

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