History of the United States, v.3, by James Ford Rhodes, 1910 [c1892].

Chapter 12, Part 1: Material Progress from 1850-1860 through Business Revival of 1860

HISTORY OF THE UNITED OF STATES

CHAPTER XII

The slavery question, after the repeal of the Missouri Compromise in 1854, became so grave that the historian in describing the period is apt to convey the impression that it engrossed the minds of Northern men, that a large part of the North was resolved upon resistance to the extension of slavery, spending all its energies in the controversy, and that the country stood still, awaiting the issue of the tremendous conflict. But for him who aims to write the story of events within the memory of many men now living, it is an advantage that he may presume upon their recollection to fill the gaps involved in the very art of writing history. "Happy the people whose annals are tiresome," said Montesquieu; and in stirring epochs the routine of work and the round of pleasures of the majority—these blank leaves of history which, if written over, would indeed be tiresome—are overlooked by the reader in the interest excited by the characteristic events. To men born during and since the war of the secession, the events of 1850-60 are almost as far away in spirit as the French Revolution is from their fathers and their grandfathers. When under influence of the powerful emotion excited by the story of the greatest of all revolutions, it seems to us that pleasure-seeking must have come to an end, and that business, except that which was necessary to support life, must have been suspended. But the spell is broken when we read Carlyle's description of Paris in 1792 and 1793. "Singular city! For overhead of all this, there is the customary baking and brewing; Labor hammers and grinds. Frilled promenaders saunter under the trees; white muslin promenadress, in green parasol, leaning on your arm. Dogs dance and shoe-blacks polish, on that Pont-Neuf itself where Fatherland is in danger. So much goes its course; and yet the course of all things is nigh altering and ending." "Neither shall the reader fancy that it was all black, this Reign of Terror: far from it. How many hammer-men and square men, bakers and brewers, washers and wringers over this France must ply their old daily work, let the Government be one of Terror or one of Joy! In this Paris there are Twenty-three Theatres nightly; some count as many as Sixty Places of Dancing." 1

Americans are more serious. When the questions of a United States bank and the tariff were those on which they divided, De Tocqueville wrote: "To take part in the government of the country and to talk about it is the most important business and, as it were, the only pleasure that
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1 Carlyle's History of the French Revolution, vol. ii. book ii. chap, iv., book vii. chap. i. "The clerk goes to his office, the workman to his shop, the artisan to his loft, the merchant to his warehouse, the student to his cabinet, and the functionary to his duty; they are devoted first of all to their pursuits, to their daily bread, to the discharge of their obligations, to their own advancement, to their families, and to their pleasures ; to provide for these things the day is not too long. . . . 'The declaration that the country is in danger,' say many eye-witnesses, 'has made no change in the physiognomy of Paris. There are the same amusements, the same gossip. . . . The theatres are full as usual. The wine-shops and places of diversion overflow with the people, National guards and soldiers. The fashionable world enjoys its pleasure parties.'"—Taine's History of the French Revolution, vol. ii. p. 188, edition of Henry Holt & Co., 1887.

an American knows."1

Between 1854 and 1860 all the ordinary political interest was reinforced by a sentiment prompted by the moral and religious feeling of men. Never was there such an earnest discussion engaging such masses of people. We represent best, therefore, the spirit of the time when in the narrative all other events pale before the central controversy. Yet when the story has been told, we see that the whole life of the people has not been described. To fill out the picture is the object of this chapter. In the decade we are considering, the growth in population was great absolutely and amazing relatively. The immigration showed a marked increase over that of the preceding decade; and even in the succeeding decade it did not reach the numbers of 1850-60.2 The percentage of increase of the population of the cities was more than double that of the whole country,3 while the gain of 1860 over 1850 in the production of cotton, wheat, corn, oats, hay, and tobacco was immense. The comparisons of the census showed a marvellous growth in wealth. But there is little need of amplifying the subject, for the story of our material advancement is apt to be more tedious than a twice-told tale. No study of the census reports is necessary for men whose memory goes back to this decade. Their recollections are exact enough to picture the progress made from the day they were excited over Webster's Seventh-of-March speech to the day when they rejoiced at the election of Abraham Lincoln. Men born since 1850 and men born since the war have had pointed out to them by their fathers and their grandfathers the amazing growth of their city or their State. The forest, in which might have been heard the howling of wolves, has given place to a field clothed
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1 De la Democratic en Amerique, vol. ii. p. 128.
2 The United States, Whitney, pp. 235, 245. Population 1850: 23,191,876; 1860, 31,443,322.
3 Increase in city population, 78.62 per cent. ; in the whole country, 35.59 per cent. Preliminary Report of the Eighth Census, pp. 117, 242.

with verdure. The black swamp through which in 1813 Harrison's army wallowed,1 and which, until the day of railroads, traders and travellers shunned, men now living have seen transformed into cultivated plains giving forth rich increase of grain. What were sterile rocky wastes resound, since the development of their mineral wealth, with the busy hum of industry. In cities where once were orchards we now behold streets lined with comfortable houses. A stately block is seen on ground which formerly served as a pasture for a herd of cows, and an opera-house replaces a squatter's cabin. Contrasts like these, familiar as they are to most Americans, convey a better idea than can come from the pen of the most thorough and accurate statistician.

The great material prosperity of the country amazed De Tocqueville in 1832 and Bryce in 1881. Since the adoption of the Constitution the progress has been certain from decade to decade. War has checked it, political troubles have weighed upon it, financial panics have interrupted it, but each wave of prosperity has been higher than the preceding. In the West, said Edward Everett in 1854, in his speech on the Kansas-Nebraska bill, "What is a wilderness to-day is a settled neighborhood to-morrow."2 What Burke said of the American colonies may be used to illustrate any decade of our growth: "Such is the strength with which population shoots in that part of the world that, state the numbers as high as we will, while the dispute continues, the exaggeration ends. While we are discussing any given magnitude, they are grown to it. . . . Your children do not grow faster from infancy to manhood than they spread from families to communities, and from villages to nations."3
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1 See Adams's History of the United States, vol. vii. p. 79.
2 Congressional Globe, vol. xxix. p. 159.
3 Burke's Speech on Conciliation with America. Works, Bonn's edition, vol. i. p. 456.

If this increase in wealth, comfort, and luxury were the
only end and the sole result of the occupation of this magnificent continent by our energetic race, philosophers and philanthropists might reasonably be disappointed, and they might then assent to the words of Lowell, who, in speaking of the time when "we had nothing to boast of in arts or letters, and were given to bragging overmuch of our merely material prosperity," declared that "had we gone down like that other Atlantis, in some vast cataclysm, we should have covered but a pin's point on the chart of memory, compared with those ideal spaces occupied by tiny Attica and cramped England."1 Nevertheless, this same material prosperity is a great factor in American life. It may have been overrated. It is easy for the scholar to underrate it. No American has preached the gospel of culture with greater force than Lowell; but in one of the legacies he left to that public to whom he told so much wholesome truth he averred that "one of the greatest lessons taught by history is the close relation between the moral and the physical well-being of man."2 In one respect the influence of our material prosperity has been enormous. It has given greater well-being to the masses than was ever before known. In another respect its influence is destined to be beyond estimate. It is giving a chance for higher education to more boys and more men than ever had it before. Have great minds failed to devote themselves to speculative truth because their whole energy was absorbed in the struggle for a living?3 America is seeing to it that her geniuses shall not lack bread and training.
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1 My Study Windows, published in 1871, p. 66. "That the individual should rise to a higher order either of intelligence or morality than had existed in former ages was not to be expected, for the United States offered less field for the development of individuality than had been offered by older and smaller societies. The chief function of the American Union was to raise the average standard of popular intelligence and well-being." —Henry Adams, History of the United States, vol. ix. p. 237.
2 Latest Literary Essays (1892), p. 162.
3 See some noteworthy remarks in the Nation of January 21st, 1892, p. 55.

The material progress during 1850-60 was greater than that of any preceding decade. To excel it, we must look forward to the time intervening between the end of the civil war and the present.1 The growth in foreign trade is marked up to the panic of 1857; after which a decline in exports and imports took place until both began to gain in 1859.

Invention was busy. To this decade belong the harvester, the breech-loading fire-arm, and the sewing-machine.2
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1 Since the tariff has again become one of the questions on which political parties divide, the comparative prosperity of the decade 1850-60 has received attention from political leaders and from party newspapers. The statement has been made on the one hand that this period was more prosperous than any before or since; on the other hand, it has been asserted that it was not a time of prosperity, but one of depression. Now, no one who has studied the subject with care can doubt that from 1846 to the first part of 1857 the country was very prosperous. Business received a severe check by the panic of 1857, from which it took the country nearly three years to recover.
   To determine the relative prosperity of 1850-60 with that of any decade since the war is more difficult, but after considerable investigation and thought I have arrived at the conclusion that the material prosperity of 1870-80 and of 1880-90 was greater. I am glad to quote Edward Atkinson, whose opinion is almost conclusive in support of this position. He writes: "The writer has recently presented statistics which cannot be gainsaid, proving, so far as figures suffice for proof, that greater progress than ever before has been made during the present generation, dating from 1865 ... in providing for the means of subsistence, shelter, and clothing, and in organizing the machinery for distributing the necessaries of life."— The Forum, November, 1888, p. 257.
   Three years later Mr. Atkinson wrote: "So far as observation, experience, and statistics combined may be taken in proof of conditions, there has never been in the history of civilization a period, or a place, or a section of the earth in which science and invention have worked such progress or have created such opportunity for material welfare as in these United States in the period which has elapsed since the end of the civil war. ... I think it may be claimed that Uncle Sam can produce one third more of all the articles of necessity and comfort, perhaps even luxury, in the same number of hours, at this time, with less labor, than he could produce the lesser quantity one generation since in the period immediately preceding the war, or we will say in the period between 1857 to 1861."—Boston Herald, November 1,1891.
2 Edward H. Knight, First Century of the Republic, p. 95, Harper & Brothers, 1876. He writes: "Although each of these was on trial, and to some extent a success, previous to 1850, yet it may be said in general terms that their celebrity and usefulness date from about that time. The Hussey and McCormick reapers were largely introduced to our countrymen by their success at the London World's Fair, in 1851 ;. . . the first valuable working sewing-machine was the 'Singer,' made in the fall of 1850."
   Ampère speaks of the McCormick machine as one of the glories of Chicago. He saw it working in England, and wrote: "Adieu done les moissonneurs de Theocrite et de Virgile, et le patriarche Booz, ordonnant & ses serviteurs de laisser des epis dans le sillon pour que Ruth puisse glaner aprss eux !"—Promenade en Amerique, vol. i. pp. 200, 201.

1852 saw the first fire-alarm telegraph system. A year later was built the first successful steam fire-engine.1 This invention took the fireman out of politics, where he had been an element necessary to reckon with, and limited his duty to that of fighting conflagrations.

The story of our merchant marine is easily told. In 1824 Webster exulted over the amount of our shipping engaged in the foreign trade. "Without any government protection whatever," he declared, our merchant marine "goes abroad to challenge competition with the whole world." How is it, he continued, that our ship-owners "are able to meet, and in some measure overcome, universal competition? It is not, sir, by protection and bounties, but by unwearied exertion, by extreme economy, by unshaken perseverance, by that manly and resolute spirit which relies on itself to protect itself.2 In 1832 De Tocqueville was struck with the extent of American commerce on the ocean. He wrote: "I cannot keep from believing that the Americans will one day become the first maritime power on the globe. They are pushed on to master the Romans were to conquer the world."3 The navigation and commerce of the United States, wrote Webster in 1850, in the Hulsemann letter, "are hardly exceeded by the oldest and most commercial nations; its maritime means and its maritime power
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1 First Century of the Republic, p. 105.
2 Works, vol. iii. p. 104.
3 De la Democratic en Amerique, vol. ii. p. 422. See also pp. 411, 412, 414.

may be seen by Austria herself, in all seas where she has ports, as well as it may be seen also in all other quarters of the globe." "Providence has placed us between the two great world oceans," said Edward Everett, in 1853, "and we shall always be a maritime power of the first order. Our commerce already visits every sea." 1 In the same year the New York Herald declared: "It must be a matter of sincere satisfaction to every American to know that in both sailing and steam vessels we have surpassed the whole world."2 George William Curtis spoke of the United States as "a nation whose ships could float all the kings and nobles and regalia of the world.'3 "We have," said Clayton, in 1854, " acquired a degree of skill in the construction of ships unequalled by any other nation." 4 Hawthorne, in his "Consular Experiences," speaks of our disputing "the navigation of the world with England." 5 Fresh from his mission to England, Buchanan, in a public speech, declared: "Our commerce now covers every ocean; our mercantile marine is the largest in the world."6 In November, 1860, on the eve of secession, Alexander H. Stephens said in a speech delivered before the Georgia Legislature: "We have now an amount of shipping, not only coastwise but to foreign countries, which puts us in the front rank of the nations of the world. England can no longer be styled the mistress of the seas. What American is not proud of the result ?"7
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1 Congressional Globe, vol. xxvii. p. 289.
2 May 16, 1853.
3 Harper's Magazine, November, 1853, p. 847.
4 Congressional Globe, vol. xxviii. p. 1258.
5 Our Old Home, chap. i.
6 Speech at a reception at the Merchants' Exchange in Philadelphia, New York Times, April 29, 1856. The figures seem to bear out Buchanan's statement. Our tonnage in 1861 was 5,539,812.—Preliminary Report on the Eighth Census, p. 108. The tonnage of Great Britain in 1861 was 4,360.000.—Article by John Fiske on Great Britain in Lalor's Cyclopaedia. In 1856, 75 per cent, of our exports and imports was carried in American bottoms.—Article by David A. Wells on American Merchant Marine, in Lalor's Cyclopaedia.
7 The War between the States, Stephens, vol. ii. p. 288.

An energetic attempt was made to compete with the Cunard line in the fast steam-service between New York and Liverpool. Edward K. Collins, whose success as a shipping merchant in handling sailing vessels had been brilliant, said in 1840, two years after the Sirius and Great Western —the first steamers, with perhaps one exception,1 to cross the Atlantic—had arrived at New York: "I will build steamers that shall make the passage from New York to Europe in ten days and less."' Congress in 1847 contracted to give Collins a subsidy of $385,000 per annum as a compensation for carrying the mails. Four fine steamships were built in the United States—the Arctic, Baltic, Atlantic, and Pacific; and the Collins line began business April 27, 1850, when the Atlantic sailed from New York for Liverpool.3 The competition between the American and the Cunard boats at once became fierce; the strife was keen to make the fastest passage. The Cunard line bore the palm for a while; then it went to Collins. Captain Eldridge of the Pacific is reported to have said on leaving Liverpool for New York: "If I do not beat the Persia (Cunarder) I will send the Pacific to the bottom." 4 For a time the Pacific had the fastest record.5 But in 1853 one of the chroniclers of the time mournfully wrote: "Our ocean steamers have become so identified with our national pride that no American but acknowledged an emotion of sorrow when it was announced a few weeks since that a Cunarder had at length succeeded by fifteen minutes, in a course of 3000 miles, in winning the palm for speed so long worn indisputably by the Collins vessels."6
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1 The steamship Savannah, of 300 tons' burden, crossed the Atlantic, using both sails and steam, in 1819.
2 Harper's Magazine, February, 1892, p. 471.
3 American Almanac, 1851, p. 327.
4 Harper's Magazine, February, 1892, p. 471.
5 Her quick passage was made in 1851. It was 9 days, 19 hours, and 25 minutes, Liverpool to New York. The boats did not then stop at Queenstown. The Baltic, however, this same year made a quicker trip.
6 Harper's Magazine, September, 1853, p. 557.

Hawthorne, spending the first month of his Liverpool residence at the Rock Ferry Hotel, and seeing from his parlor window the activity of the port, has left his testimony to the competition between the lines. "Once a fortnight," he wrote, "comes an American steamer of the Collins line; and then the Cunard salutes her with a cannon, to which the Collins responds, and moors herself to another iron buoy, not far from the Cunard. When they go to sea it is with similar salutes, the two vessels paying each other the more ceremonious respect, because they are inimical and jealous of each other."1

The first subsidy being found too small, Collins asked for more, though for a time without success. In 1852 the steamship Baltic came to Washington, and Congress was invited to visit the ship. It was understood that a handsome entertainment would be provided. Congress adjourned for one day, so that the senators and representatives might accept the invitation, but this action encountered opposition in the Senate. One senator declared that Collins and his friends were "acting upon a saying we sometimes hear throughout the country, that the nearest way to the hearts and understanding of senators is down their throats."2 Before this Congress adjourned, the subsidy was increased to $858,000 per annum, but the arrangement for the increased subsidy might be terminated by Congress after December 31, 1854, by giving six months' notice.3 "The Free-Soil members of Congress," complained Bryant,—"Hale and Sumner and many others,—are not more than half right on various important questions. . . . They vote away the public money into the pockets of the Hunkers—Collins, for example." 4 Success then seemed to have crowned the work of Collins. July 8, 1854, his heart was made glad by the arrival of the Baltic, 9 days, 16 hours and 53 minutes after she
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1 English Note Books. Entry of September 1, 1853.
2 Congressional Globe, vol. xxiv. p. 658.
3 Act of July 21,1852.
4 Life of Bryant, Godwin, vol. ii. p. 63.

had left Liverpool, surpassing the time of the Arabia in 1853, and making the quickest trip west on record.1

Hard upon this came disaster. In the decade we are considering, New York City saw no more exciting and sorrowful day than October 12, 1854, when the news came that the Arctic had been sunk fifteen days before, as the result of a collision in a dense fog with the French steamer Vesta off Cape Race, and that nearly all on board of the Arctic were lost.2 The captain of the Arctic was brave, but he did not exhibit the sound judgment and energetic command which are expected of a master seaman at such times. The sea was calm, and the ship did not go down until four and a half hours after she was struck.3 Yet only twenty-two passengers and sixty-five of the crew were saved.4 All the women and children on board, including the wife, daughter, and son of Collins, were lost. Three hundred and twenty-two sank beneath the waves. Discipline had broken down; the conduct of the crew was dastardly. As the various heart-rending accounts of the accident were published, business was suspended, and New York City gave itself up to mourning.5 "The disaster comes," said the New York Tribune, "from bullying fogs and waves for the pastime of seeing a steamer arrive in 9 days, 37 minutes and 23 seconds from Liverpool."6

At the next session of Congress, the annual subsidy of $858,000 to the Collins line was passed, and with it was incorporated a provision depriving Congress of its option to terminate on six months' notice the arrangement for the additional compensation, thus making the subsidy absolute
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1 New York Times, July 10, 1854.
2 American Almanac for 1856, p. 367.
3 According to the account of Luce, the captain of the Arctic, the ship was struck at 12.15 and sank at 4.45. New York Times, October 16, 1854.
4 She had 226 passengers, exclusive of children, and a crew of 175.
5 See New York Tribune and Times.
6 Weekly Tribune, October 21, 1854.

for the remaining six years of the contract. This the President vetoed.1 The New York Tribune praised President Pierce for rebuking corruption by defeating the Collins grant.2 Congress failed to pass the bill over the veto, and then voted the subsidy under the previous conditions.3 The Pacific, Captain Eldridge, sailed from Liverpool, January 23, 1856, and was never again heard from.' This was the final blow. In August, 1856, Congress directed the Secretary of the Navy to give the notice terminating the arrangement for the additional allowance to the Collins line. April 1, 1858, the three remaining ships were sold by the sheriff for a sum considerably less than the cost of one of them.'

To the decade of 1850-60 belongs the demonstration of the fact that telegraph messages could be successfully transmitted across the Atlantic Ocean. In 1848, Sir Charles Lyell stated, what was then a surprising circumstance, that a friend in London had asked a question, needing a quick response, of a man in New Orleans, and had received the answer in twenty-nine days.' Ten years later the Queen and the President were exchanging congratulations over the electric wires. The success was mainly due to the farsightedness and indomitable energy of Cyrus W. Field. Four years previously he had been applied to for assistance in the construction of a land-telegraph line across the island
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1 March 3, 1855. See Veto Messages, 1886, p. 251.
2 Weekly Tribune, March 10,1855.
3 Amount paid for the transportation of mails of the United States to and from foreign countries, to companies owning steamships or other vessels sailing under the American flag: 1853, $1,880,273.33; 1854, $1,903,286.36; 1855, $1,936,714.62; 1856, $1,886,765.63; 1857, $1,589,152.65; 1858, $1,177,303.01; 1859, 1,075,220.09. Nothing was paid foreign vessels until 1858, when small payments to them began.—Letter from the Superintendent of Foreign Mails to R. Q. Mills, May 7, 1886.
4 American Almanac, 1857, p. 368.
5 New York Times, April 2, 1858. The Adriatic had been added to the line after 1850.
6 Second Visit to the United States, vol. i. p. 185,

of Newfoundland, which, when completed, would bring the United States within one week of Europe. In the quiet of his library as he carefully weighed the project, turning his terrestrial globe, he said to himself: "Why not carry the line across the ocean?"' An unsuccessful attempt to lay the cable was made in 1857, and another in the early summer of 1858; but on August 5, 1858, the last stroke of work was done, and Trinity Bay, Newfoundland, was connected with Valencia Bay, Ireland, by a submarine telegraph.

America went wild with excitement and joy. Cyrus W. Field was the hero of the time. There were ecstatic humors in the ink of American journalists. One wrote: "It is not possible to grasp the wondrous beauty and magnitude of this triumph. The ocean has defied man; now man defies the ocean." It is an event "which belittles the imagination and exceeds the capacity of language." It is "the greatest undertaking ever attempted by man."2 Yet it was remarked that in England the event aroused less enthusiasm. "John Bull," an editor wrote, "received the intelligence without an emotion, and kept himself as cool as a cucumber." 3 Hero-worship intensified the American rejoicing. While the enterprise was largely backed with English money, its conception and its execution, in spite of so many obstacles, was due to an American. The first message sent over the wires was from the Queen to the President. She fervently hoped that " the Electric Cable . . . will prove an additional link between the
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1 American Cyclopaedia, article "Cyrus W. Field;" Story of the Atlantic Telegraph, Henry M. Field. This book gives a circumstantial and graphic account of the enterprise.
2 New York Tribune, August 6 and 10, 1858. See also New York Times, August 6.
3 New York Times, August 23, 1858; see also article of August 24; but the London Times was enthusiastic enough. "Since the discovery of Columbus," it said, "nothing has been done in any degree comparable to the enlargement thus given to human activity." Cited in Report of Proceedings of banquet to C. W. Field, November 15, 1866.

nations whose friendship is founded upon their common interest and reciprocal esteem." In reply, President Buchanan echoed the sentiment.1 Between August 16 and September 1, four hundred messages were sent through the cable.' The last one, to Cyrus W. Field, was read by him at a great celebration over the success of the enterprise, which took place September 1, in New York City. Then, through a defect which could not be remedied, the Atlantic telegraph became silent. Again had the enterprise failed. But Field was not one to be crushed; he kept at work. The crash of civil conflict delayed the undertaking, but the year 1866 saw a cable successfully laid, and a permanent telegraphic connection established between Europe and America.

Although the attempt to establish an American steamship line, which should carry passengers and mails as swiftly and safely across the Atlantic as did the English vessels, had failed, and although the Atlantic telegraph was not for the time a success, yet these noble efforts show to what extent the energetic spirits of the country were willing to embark in hazardous enterprises, and that they sought after honor as well as profit. Such attempts serve to bring out clearly by contrast the successful results obtained in other undertakings, and they emphasize for our purpose the great prosperity of the country from 1846 to 1857.

What were the causes of this extraordinary material development? In the main, they were the same as those of our growth from the adoption of the Constitution—those which gave rise to the well-being that Webster rejoiced at in his Plymouth speech of 1820. "Two thousand miles westward from the rock where their fathers landed," he said, "may now be found the sons of the Pilgrims, cultivating smiling fields, rearing towns and villages. . . . Regions
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1 New York Times, August 20, 1858. The messages were exchanged August 16.
2 C. W. Field's speech at banquet, 1866.

large enough to be empires, and which half a century ago were known only as remote and unexplored wildernesses, are now teeming with population, and prosperous in all the great concerns of life: in good governments, the means of subsistence, and social happiness."1

The chief causes of our prosperity have been the energetic and independent disposition of our people, characteristic of the Protestants of the seventeenth century; their bringing to a virgin country the arts and appliances that an old civilization had painfully evolved; their own rapid progress in mechanical invention; a government giving efficient protection to property, and a fair degree of protection to life; equality of men and free institutions; emancipation from such European institutions as had circumscribed individual activity; a good climate and a good soil; local self-government, little governmental interference, and free trade over a large extent of territory.2 That the character of the people, and, what has almost naturally followed, the character of our institutions, are greater factors than the material virtues of our continent, we must believe when we contrast New England with Argentine and Chili.3 "Countries," wrote Montesquieu, "are cultivated not by reason of their fertility, but by reason of their liberty."4 We
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1 Webster's Works, vol. i. p. 30. On our great material prosperity in 1825, see Webster's "First Bunker Hill Oration," Works, vol. i. p. 63. 2 See De Tocqueville, Democratie en Amerique, passim; The Predictions of Hamilton and De Tocqueville, James Bryce, Johns Hopkins University Studies in History and Political Science, 1887, p. 56 ; Grund's Americans, vol. i. p. 272, vol. ii. p. 104; The Industrial Progress of the Nation, Atkinson, p. 77; Article by Edward Atkinson in the Boston Herald, Nov 1, 1891; Essays, Scientific, Political, and Speculative, Spencer, vol. iii. p. 472; Lecky's England, vol. ii. p. 1.
3 South America has probably 3,000,000 square miles of arable land— just the area of the United States exclusive of Alaska. A contrast between the history of the United States and that of the South American countries would be more instructive, were it not for the fact that a large part of South America lies in the tropics. See Edward Atkinson's article in the Boston Herald, January 10,1892; also De Tocqueville, vol. ii. p. 241.
4 Esprit des Lois, livre xviii. chap. iii.

see, said Carlyle, "these descendants of Saxons conquering more than the Romans did, who subdued men, but these subdued the incoherences and difficulties of Nature, reclaiming wild and boundless wastes, and converting them into arable land and scenes of civilization!" 1

The American, even he who is of pure English blood, is a different man from the Englishman. As an easy way of accounting for the difference, it used to be ascribed to the variation in climate. Investigators are more diligent now than heretofore in collecting their facts, and less rash in their generalizations, so that the tendency of such discussions in the last generation has been to ascribe less influence to this cause.' But though this tendency is undoubtedly sound, it does not follow that climate has no effect. In one respect it seems clear that the climatic influence has had something to do in transforming the Englishman into the American. Dry climates, reasons Herbert Spencer, induce energy.' Bryce felt "the brilliance and keenness" of our air. "The fog of an English town," he wrote, "is wanting; you are in a new world, and a world which knows the sun."4 In business, the American has greater energy than the Englishman.' The migration from
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1 History of Literature, p. 149. "The incalculable Yankee Nation itself, biggest Phenomenon (once thought beautifullest) of these Ages."—Carlyle's Frederick the Great, book xii. chap. xii. On the difficulty of subduing the continent, see Henry Adams's History of the United States, vol. i. pp. 16, 40, 72. On "the marvellous prosperity," due to " the thrift, the energy, the self-reliance of the people," see McMaster's United States, vol. iii. p. 459.
2 See for example Herbert Spencer's Sociology; Nature and Man in America, Shaler, p. 265. 3 Sociology, vol. i. p. 22.
4 American Commonwealth, vol. ii. p. 661; see also Shaler, p. 264.
5 De Tocqueville said of the Northerner: "Il y a. . . une sorte d'héroisme dans son avidité pour le gain."—De la Démocratie en Amérique, vol. ii. p. 315. "All Americans, it has been said, know business; it is in the air of their country."—English Constitution, Bagehot, p. 187; see also Society in America, Martineau, vol. i. p. 293, vol. ii. p. 145.
   In the eighteenth century the American had not secured his present reputation for restless activity. Hamilton thought that "Americans were too indolent, and that taxation would be a valuable spur to them."—Sumner’s  Hamilton, p. 149. Baron de Kalb's aides were too lazy to do his writing. Professor Sumner adds: "This trait seems to be connected with the general easy-going temper. It raises an interesting question as to when and how the Americans took on the character of highly strained nervous energy which has marked them in later times. Traces of it are hardly to be found until after the second war. It has always been presented side by side with an ability to spend time in absolutely vacuous idleness which no other people shows in the same degree."—Ibid., p. 98. "Strange to modern experience were the continual complaints in books of travel that loungers and loafers, idlers of every description, infested the taverns, and annoyed respectable travellers, both native and foreign. Idling seemed to be considered a popular vice, and was commonly associated with tippling. So completely did the practice disappear in the course of another generation that it could scarcely be recalled as offensive; but in truth less work was done by the average man in 1800 than in after-times, for there was actually less work to do."—Henry Adams, vol. i. p. 56.
   English energy seems to be of modern growth. "Nowhere in the world," writes C. H. Pearson, in National Life and Character, p. 99, "has the struggle for existence been so fierce as in Great Britain, and it has been the mainspring of English energy. In the sixteenth century Meteren declared that Englishmen were as lazy as Spaniards."

Europe to America, and from the East to the West has been a constant sifting of population, so that in America as compared with Europe, and in the Western States as compared with the Eastern, we have a constantly increasing predominance of youth, health, and ambition. The influence of this factor in creating an atmosphere of hopefulness and strenuous activity, which has exerted a profound influence on American character, can hardly be overestimated.1 Another influence of the greatest power has been the immense development of rapid exchange and communication following the application of steam to production and transportation and the invention of the electric telegraph.2 Trading
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1 Compare Bryce's chapter in vol. ii. on "The Temper of the West."
2 See, for example, Spencer's Sociology, vol. i. p. 575, where, in speaking of the vast transformation suddenly caused by railways and telegraphs, he writes: "Within a generation the social organism has passed from a stage like that of a cold-blooded creature with feeble circulation and rudimentary nerves to a stage like that of a warm-blooded creature with efficient vascular system and a developed nervous apparatus. To this more than to any other cause are due the great changes in habits, beliefs, and sentiments characterizing our generation."

increased in extent and variety, and social observers detected a growing love of gain. The "nation of shopkeepers," as England was called in the eighteenth century, is not, we must admit, as vivid a description as Leigh Hunt's characterization of the United States in the first half of the nineteenth century. I can "never think of America," he wrote, "without seeing a gigantic counter stretched all along the seaboard;"1 and indeed this avidity in the pursuit of gain was noted of New Englanders in colonial days.2

For the prosperity of 1846-57 there were several contributing causes, either special to that period, or then for the first time effective. The greatest of these (whose influence, continuing with ever-increasing momentum to our own day, is still transcendent, and will pervade the future to a degree to which no philosopher can now set bounds) were railroad transportation, beginning its first great era,' and the coming into general use of the electric telegraph.4

"We may mark the year 1849 as the commencement of railroad extension. Having less than 6000 miles January 1, 1849, the country had at the end of 1860 30,635 miles. In 1850 it was impossible to go by direct railway from New York to either Albany or Boston; in 1860 New York had continuous lines reaching beyond the Mississippi. In 1850 Chicago had one short road; in 1860 that city was a great railroad centre, her main lines "reaching hundreds of miles —east, west, north, south. In 1850, Ohio, Indiana, and
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1 Lowell's My Study Windows, p. 76.
2 Montcalm and Wolfe, Parkman, vol. i. p. 26; Lecky's England, vol. iii. p. 316; Bancroft, vol. v. p. 143, Little, Brown & Co.'s edition of 1876. I presume it will not be necessary to remind the reader that the struggle against physical obstacles in the early days may have fostered this trait more than the climate.
3 The period 1833-47 was unfavorable for railroad building; "nor was it until 1849 that the new system of inland carriage began that prolific career."—Schouler, History of the United States, vol. iv. p. 131.
4 William G. Sumner, in First Century of the Republic, p. 253.

Illinois were open fields; in 1860 they were crossed and recrossed many times." 1 "I arrived here last night," wrote Emerson from Pittsburg in 1851, "after a very tedious and disagreeable journey from Philadelphia, by railway and canal, with little food and less sleep; two nights being spent in the rail-cars, and the third on the floor of a canal-boat."' Not until the end of 1860 did the railway system between the East and the West approach unification 2 and give promise of that consolidation of separate railroads and branches into systems which in our own day has characterized this development.

The primitive ideas in regard to railway travel prevailing
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1 The American Railway, p. 431 et ante.
2 Life of Emerson, Cabot, p. 566. "A good story is told of James Burns, at one time canal commissioner. J. Edgar Thompson, who was in 1846 chief engineer of the Pennsylvania Railroad, met Burns in Hollidaysburg. 'I asked him,' said Burns, 'how he expected to take cars over the mountains.' 'By locomotives,' said he. Then I saw the man was a fool. I thought I would find out how big a fool he was, so I asked him how long he expected a train to be in running from Pittsburg to Philadelphia. 'Fifteen hours,' he said. Then I knew the man was a howling idiot."—Article of Russel Errett, Magazine of Western History, vol. vii. p. 44.
   "A gentleman who resides in Bath, Me., recently gave the items of a trip to Peoria, 111., which he and his wife took thirty-five years ago (1853). The same trip can now be taken in two days from Portland, at an expense of about $35.

Bath to Portland (stage) $5 00
Portland to Boston (boat) 7 50
Boston to Pittsburg, via Stonington Railroad and steamboats and canals 64 00
Pittsburg to St. Louis 50 00 St.
Louis to Peoria 15 00
Total $141 50

The time occupied was fourteen and a half days, and the distance travelled was 2400 miles, an average of about seven miles an hour."—Lewiston Journal. Cited by Boston Transcript, June 29, 1888. A comparison of some of the items leads to the conjecture that the $35 is the expense for one person, while the $141.50 is for that of two persons.
3 Atkinson, The Industrial Progress of the Nation, p. 33.

in the decade of 1850-60, are well illustrated by what was then known as the Erie Railroad War. The traveller who goes from New York to Chicago in our day is not obliged to set foot from his train, for he is provided with the comforts and conveniences of a hotel. Far different was it in 1853. The traveller could, indeed, then go from New York to Albany in four hours; but there he must change to another road and another train which carried him from Albany to Buffalo, and he esteemed himself fortunate to be able to cover so great a distance in the same car. If he made the western connection at Buffalo it was considered good-luck. The tales of those days are full of complaints of trains behind time, of connections missed, of tedious delays. From Buffalo the traveller had a short run to the station on the line between New York and Pennsylvania, called State Line, where, on account of a difference in gauge, a transfer was necessary. On the broader gauge he could travel twenty miles to Erie, Pa., when he must change again to a road of the Ohio gauge. The train on this railroad carried him to Cleveland; but on the way, if at all late, he was subject again to the anxiety of missing connections. At Cleveland he must hurry to the river, where a scow, carrying at most a dozen passengers and sculled by a weather-beaten mariner, was used as a ferry to take passengers to the Toledo railroad station.1 In this open boat travellers suffered from exposure to rain and snow; at times the waves ran high and the crossing was attended with danger. If the eastern train was crowded or a few minutes late, haste was necessary to secure passage in the first trip of the scow, for it was well known that the Toledo train started on schedule time and waited for neither train nor boat. At Toledo the traveller made the last change, and— if not more than five minutes behind time—found the Michigan Southern train awaiting him; otherwise he had a tedious delay, which, if his arrival at Toledo happened on a
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1 See Things in America, Chambers, p. 143.

Saturday, might extend to thirty-six hours.1 The traveller from New York who missed no connections and arrived at Chicago on time had a marvellous story to tell.

The railroad managers of the lines between Buffalo and Erie, eager to improve their route, decided to alter the six-foot gauge of the railway between State Line and Erie to four feet ten inches—the gauge of the roads east of State Line and west of Erie—so that passengers could go from Buffalo to Cleveland without change. The railroad ran a distance through the streets of Erie. The Erie municipal authorities refused to give a permit for making the alteration unless the railway company would agree to stipulations to which its directors, considering them unreasonable, declined to accede. In the contest which followed, a color of law and reason was given to the position taken by Erie; but no one was deceived as to the real ground of the trouble. Erie objected to the change of gauge because the transfer of passengers and freight was deemed important to the borough's prosperity. The wait involved brought custom to her eating-houses; the transfer of freight and live-stock gave work to her people. The populace ignored the legal points and the pretended grounds of demur, but they keenly appreciated the vital objection.

On December 7,1853, the railroad company began at State Line the work of changing the gauge. The news came quickly to Erie. A cannon was fired to call out the citizens. A large mob assembled, tore up the track, and cut down the railroad bridge in the borough. The infection spread to Harbor Creek, a Pennsylvania town seven miles east of Erie, and that evening its citizens held an orderly meeting and resolved to remove the track of the railroad running on the public highway. The resolution was the next day carried into effect. Two days later (December 10) the track of the new gauge was completed to the borough limits of
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1 See for example Greeley's experience, New York Weekly Tribune, January 7, 1854.

Erie. That night rioters at Harbor Creek tore up the track, destroyed the bridge, and ploughed up part of the grade of the road. War had begun in earnest. The mayor and the sheriff at times directed the mob, while the local militia, arrayed for service, swelled its number. Even the governor of the commonwealth seemed to sympathize with the Erie people. Certainly they had the sentiment of the whole of Pennsylvania on their side. The United States Circuit Court then granted an injunction restraining all persons from interfering with the railroad company. An Erie justice of the peace pronounced the injunction null and void, and the populace, believing the later decision to be the better law, refused to respect the order of the court. Two days after Christmas, the Harbor Creek bridge was torn down for the fourth time.

The contest attracted the attention of the country. In Buffalo the excitement was intense. Cincinnati held an indignation meeting presided over by Thomas Corwin, to protest against the conduct of the Erie citizens. The New York Tribune said: "Let Erie be avoided by all travellers until grass shall grow in her streets, and till her piemen in despair shall move away to some other city."1 The press of Philadelphia espoused the cause of Erie. The City of Brotherly Love held a large public meeting to express sympathy with the borough at the other end of the commonwealth. It was declared that "the only protection Erie has to prevent her own ruin is to require the break to be made within her boundaries."

About this time Horace Greeley had occasion to go West. He wrote to his newspaper that he was obliged to ride the seven miles from Harbor Creek to Erie in an open sleigh "through a cutting storm of wind, snow, and sleet. . . . Let Erie have her way," he continued, "and all passengers and freight must change cars before her pie-shops. . . . The whole world is to be taxed, as in the days of Caesar Augustus, in
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1 December 31, 1863.

order that Erie may clutch a sixpence for every dollar of expense she imposes on others. Is it strange that so mean and selfish an exaction should be enforced by mobs, arson, devastation, and ostentatious defiance of judicial mandates?"1

With the new year the excitement grew. The Erie people became vindictive. They warned the president and a director of the railroad company, living at Erie, to leave the borough. Women joined the rioters and assisted in the work of destruction of the bridges. The New York Tribune called upon President Pierce to interfere, and suggested that he issue a proclamation and call out troops in order that the laws might be executed. "Had a runaway negro," this journal said, "been somehow mixed up with the matter, we should have had half of the United States army in Erie a month ago." 2 The trouble brought into view the rivalry between New York and Philadelphia, between New York State and Pennsylvania. The Commonwealth of Pennsylvania was declared an accomplice with the Erie rioters and bridge-burners, for the purpose of diverting business from the West to the seaboard through her territory and to her port by a projected line from Erie to Philadelphia, and an appeal was made to the West to frustrate her purpose. It is possible that the sentiment of the West had some influence in bringing about a settlement; but in the early part of January, 1854, the minds of Northern men became engrossed with the proposed repeal of the Missouri Compromise, and the Erie war ceased to attract attention. An act of the Pennsylvania legislature, by a fair compromise, brought the trouble to an end. The railroad company, having consented to confer certain desired advantages upon Erie and Pennsylvania, was allowed to complete the change of gauge and run its trains through Erie without molestation.
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1 Letter of Horace Greeley from Cleveland, January 1,1854, WeeklyTribune, January 7th. 2 January 19, 1854.

With the extension of the railroad system came accidents; travelling in the decade of 1850-60 was attended with much greater danger than it is now.1 Casualties, both on the railway and on steamboats, rated according to the number of passengers carried, were more frequent and more terrible than at the present day. The era of the application of steam to travel had only begun, and the aberrations of this force, when unchained, harrowed men with fear and wonder. The moralist at the North preached a sermon on the national disregard of life as evidenced by the railway and steamboat accidents.' The economist of the South spoke of railroads that had "stained their tracks with human blood."3 De Bow seriously suggested as a remedy, if his recommendation for making the railroads pecuniarily liable for the loss of life and limb of their passengers proved inadequate, that on every train should be placed a small private car, in which one of the directors of the railroad company should be required by law to ride; for accidents were attributed to fast time and to want of proper precautions, both of which were supposed to be in some way due to the greed of railway directors.4 A comical illustration in Harper’sMagazine represented a popularly suggested remedy. On the top of a locomotive just starting, two fat, sleek, and prosperous-looking directors were tied as a gage for the safety of the passengers.5
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1 From January 1 to August 12, 1853, there were 65 fatal accidents; the total number killed was 177, injured 333. New York Herald cited by De Bow's Renew, October, 1853, p. 429. The railroad mileage January 1, 1853, was 15,360. See vol. i. p. 416.
2 "Editor's Easy Chair," Harper's Magazine, July, 1853, p. 272.
3 De Bow's Review, October, 1853, p. 426.
4 Ibid., p. 430.
5 July, 1853. The accident at Norwalk, Conn., in 1853, to the express train from New York to Boston, by which forty-six persons were killed and thirty severely injured (for account of which see Charles Francis Adams's "Railroad Accidents"), called forth the following letter to the New York Tribune: "Let rails be laid with cars drawn by horses through great lines of travel. Tens of thousands of persons who will not go by steam, either by land or water, will fill the horse-cars. Each relay of horses can travel twenty miles a day, at something near ten miles an hour. So that one may go in a day 160 miles and sleep eight hours; he can stop anywhere in five seconds, view scenery, and be as safe as on the present horse-car track of Sixth and Eighth avenues." To this the editor of the Tribune replied: "No, sir! Ten miles an hour won't do. There is no difficulty in going thirty with safety, under proper arrangements."

Massachusetts early enacted a law, making the railroads pecuniarily liable for the death of passengers resulting from negligence. This course was gradually followed by the other New England States. New York and Pennsylvania before 1850, and Ohio, Indiana, Illinois, Michigan, and Wisconsin in the decade of 1850-60, adopted similar legislation.1

Contemporaneous with the growth of railroads and in many cases as an adjunct to them, steamboat navigation, the earliest successful form of steam transportation, increased on our inland waters.2 The accidents on the water were more fearful than those on the land. In June, 1850, on Lake Erie, the steamer Griffith was burned to the water's edge and three hundred persons were drowned within a quarter of a mile of land. This and other similar accidents3 induced Senator John Davis, of Massachusetts, to devote much time and labor to the preparation of a bill that should provide for the better security of travellers by water. His bill, having passed the Senate, underwent amendment in the House, and, coming up again for consideration in the Senate, August 28, 1852, gave rise to an animated debate,
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1 General statutes of Massachusetts, p. 362, sec. 97, 1840; Revised Statutes of Maine, p. 370, sec. 42, 1848, 1855; General Laws of New Hampshire, p. 635, sec. 14, 1850; Statutes of Connecticut, p. 758, sec. 8, 1853; Revised Laws of Vermont, p. 658, sec. 3443, 1855; Public Statutes of Rhode Island, p. 553, sees. 15, 16, 17, 1855; New York Code of Civil Procedure, sees. 1902, 1904, act passed in 1847 ; Laws of Pennsylvania, 1836; Law of Ohio, approved March 25, 1851; Law of Indiana, approved May 11, 1852 ; Law of Illinois, approved February 12, 1853 ; Law of Michigan, 1855; of Wisconsin, 1858; Pierce on Railroads (1881), p. 887.
2 It was not until after this decade that the steamboat passenger service declined from inability to meet railway competition,
3 The total number of boats lost in the year 1850 on the Western waters was 109, and lives lost 320.—Industrial Resources of the South and West, De Bow, vol. iii. p. 156.

prompted largely by the feeling caused by the recent disasters to the steamer Henry Clay and the steamer Atlantic. The Henry Clay, while racing with a rival boat on the Hudson River, using tar or like inflammable material under the boilers, with the safety-valve tied down, took fire near Yonkers; a loss of eighty-one lives was the result.1 After the accident, an indignant passenger wrote to the New York Herald asking if the authorities could spare time from their absorbing occupation of President-making to devise some means to prevent "the accursed practice of racing upon the Hudson River," by which the lives of thousands were daily put in jeopardy. Owing to a lack of merely ordinary care the steamer Atlantic had been sunk on Lake Erie in a collision with the propeller Ogdensburg, and two hundred persons were lost.2 One journal entitled its account of this collision "More Murder by Steam ;"3 another said, "If intemperance slays its hundreds, and pestilence its thousands, the modern steam demon is instrumental in slaying its tens of thousands;" and the same editor bewails the "complete disregard of human life which has now become a distinguishing trait of the national character." 4

With these occurrences fresh in the minds of senators, their expressions in the debate on the Davis bill were emphatic. "Three hundred persons," said one senator, "have perished within the last month on our waters, and no less than seven hundred lives have been lost by steamboat accidents within the last twelve months." In reply to arguments in favor of a postponement of the subject to another session, he declared, "This is a bill to punish murder, and nothing else." One of the senators from Texas said: "The perils accompanying steamboat navigation, under the present system, are so great, and the chances of encountering an instant and horrible death are so numerous, that... I will candidly avow that
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1 This was July 28th. See New York Herald and Tribune.
2 This was August 20th. Ibid.
3 The New York Independent.
4 New York Herald.

I would rather take part in an Indian fight; aye, or enter on a long Indian campaign, than venture on undertaking this voyage of three thousand or four thousand miles, as I must, to see my wife and children once again." 1 The bill passed and received the approval of the President. It provided for a careful inspection of the steamers to see that suitable and safe provisions were made throughout such vessels, to guard against loss or danger from fire; boilers must also be strictly inspected. There must be carried, in accordance with the size of the boat, a proper number and kind of small boats, and a life-preserver for each passenger. The bill was one of forty-four sections, and appeared to cover all points suggested by the experience of the past few years. One of the last sections made the boat and its owners liable for damage sustained by any passenger, if such damage happened through neglect to comply with the provisions of this law.2 This statute in its substantial features still remains on our statute-book.

Having spoken of the causes of the material prosperity of the United States in operation from the adoption of the Constitution,3 and of those which began in 1846 and still continue,4 I have now to refer to the causes special to the years 1846-57. They were, the increase in immigration, a result of the Irish famine and of the revolutions on the Continent; the demand for our large harvests of grain, occasioned by the Irish famine and the repeal of the British corn-laws; and the production of gold in California.

The prosperity of 1846-57 has been attributed to yet another cause—the revenue tariff of 1846. While economists
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1 Congressional Globe, vol. xxiv. p. 3425.
2 The full text of this act may be found in Congressional Globe, vol. xxiv. part iii., Laws, p. 38; United States Statutes at Large, chap, cvi., App., August 30, 1853. Senator Rusk, of Texas, thanked Davis, "in the name of humanity, for the immense labor he has bestowed upon the preparation of this bill. It will form a page in his history that his children may look upon with pride when he is gone."
3 See p. 15.
4 See p. 18.

have spoken of this influence with caution,1 statesmen have declared that it was the main factor in the material development of the decade. The Act of 1846 is known as the Walker Tariff, for it was framed on lines recommended by the Secretary of the Treasury, Walker, and its passage was due to his influence and to the support of the administration. His report, submitted to Congress in December, 1845, when he recommended a material reduction of the tariff, has received high commendation from writers opposed to protection, for the reason that he affirmed principles which are held by the majority of political economists, and which are undoubtedly sound. But his advice to repeal all specific duties, and to substitute entirely ad valorem duties, is so at variance with correct legislative practice as to make it highly probable that all the commercial advantage which might have proceeded from his reduction of the tariff was more than offset by the demoralization from the increased opportunities for fraud. The protective tariff of 1842 was based upon the principle of specific duties where possible, ad valorem duties only when unavoidable; the tariff of 1846 for the first time in our history made the duty on every article ad valorem on a foreign valuation. Webster, ably arguing against the Walker Bill, seized upon its weak point, and devoted a large portion of his speech to showing the impolicy of the proposed departure from the principle which governed the commercial legislation of England, and which in the main had dictated our own policy. "It has been the experience of this government, always," he declared, "that the ad valorem system is open to innumerable frauds. . . . Sir, a system of ad valorem duties is not free trade, but fraudulent trade."2 In remarks made eleven days previously, Webster had stated that nearly all the New York City importers of reputation and character had memorialized
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1 See William G. Sumner, First Century of the Republic, p. 253; Tariff History of the United States, Taussig, p. 121.
2 Speech of July 25 and 27, 1846. Works, vol. v. p. 178.

Congress against the proposed new system; and he then presented a petition from all the importers of drygoods in Boston, praying against the change: they averred that if ad valorem duties are substituted for specific, "we shall be compelled to abandon our business into the hands of unscrupulous foreigners, who have little or no regard to our custom-house oaths."1 That events bore out the prophecy of the Boston merchants is probably true. Under the operation of the tariff of 1846, frauds were rife.2 The reduction of the tariff was one sixth, or about five per cent, on the valuation’s hardly a sufficient stride towards commercial freedom to warrant the impulse given to individual dishonesty in dealings with the government.

That this comparatively slight reduction of the tariff had any considerable influence on the prosperity of the country cannot be sustained by the historical evidence. There is no reason whatever for thinking that, had the tariff of 1842 remained in force, things would have fallen out much differently. The other causes adequately explain the effects. The results ascribed to the tariff of 1846—and, for that matter, to many other tariff acts 4—call to mind the importance that
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1 Congressional Globe, vol. xv. p. 1089.
2 See President Fillmore's Message of December, 1852, Congressional Globe, vol. xxvii. p. 3. "In my deliberate judgment, specific duties are the best, if not the only, means of securing the revenue against false and fraudulent invoices; and such has been the practice adopted for this purpose by other commercial nations."—Message of President Buchanan, December, 1858; see also Morrill's speech of April 23, 1860.
3 The tariff of 1842 was substantially equivalent to a 30-per-cent. tariff; that of 1846 was a 25-per-cent. tariff. See Rates of Duty on Imports, Report No. 2130, 51st Congress 2d Session—De la Democratie en Amerique, De Tocqueville, vol. i. p. 275.

he fly in La Fontaine's fable attributed to his efforts in getting the coach drawn up the hill.

I should have been glad to relate the history of the tariff from 1846 to 1861 without trenching upon a present issue of politics. But fairness requires that the point of view from which these events are approached should be disclosed. Moreover, as history does not admit of complete induction, we shall better understand the influence of this particular legislation if we are able to agree upon the general considerations that bear upon it.

The importance of the tariff is overrated on account of its having been for so many years a partisan question. If the country is prosperous under a revenue tariff, its advocates maintain that the prosperity is due to their legislation; if times are hard under a policy of protection, they assert it is because the principles of political economy are violated. On the other hand, if the country is prosperous under a protective tariff, its advocates point to that prosperity as a result of their policy; if disaster comes contemporaneously with a tariff for revenue only, they aver that nothing different could have been expected when practical business ideas were not conformed to. This sort of reasoning is natural. Nor is it bad for a country that its people should be divided on such an issue as a revenue policy. The question is something higher than a mere strife between the Ins and the Outs. As the tariff policy of our country affects the prices of necessary articles, it has a certain importance among the affairs that go to make up the life of the citizen. Moreover, the teachings of science and political economy are thus brought to bear on the question in a way that broadens the minds of men. While the discussion of it is an education for voters, yet it is not one of those deep constitutional or social questions which the thinking citizen trembles to see made an issue at the polls, since it does not touch the organic life of the nation or the very constitution of society. The revenue policy of the country may increase or decrease the income of the mass of men a trifle; it may increase or decrease in a small degree their cost of living; but beyond this it does not affect the security of property, nor does it raise a vital question of life or liberty. The moral bearing given in England to the agitation for the repeal of the corn laws,1 enforced as it was by the argument of famine, cannot obtain in the United States, where the movement for free trade is not one prompted by the desire for cheap food. Food, says Edward Atkinson, costs the average family three or four times as much as clothing. In this fact, for the mass of the people, lies the difference between the weight of reasons for free corn or for free wool.

The economists maintain that a protective tariff does not in our country procure the greatest good of the greatest number; that while legislation can create nothing, yet legislation affects the distribution of the earnings of the nation, and the protective tariff is apt to make an unfair distribution, for the reason that it is an interference with the natural movement of trade; moreover, protective legislation may direct investments into channels rendered profitable at the expense of other interests, and if this takes place, the
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1 See The Platform, Jephson, chap. xviii. Students, however, differ. Lecky wrote in vol. vi. of his History of England, published in 1887: "The growth of the manufacturing towns produced an extreme pressure of population on subsistence, and a great reduction of the corn duties became absolutely inevitable. Under these circumstances the manufacturing leaders strenuously supported the agitation for their total repeal. As great employers of labor, it was to them a class interest of the most direct and important character; and by a singular felicity, while they were certain to obtain an enormous share of the benefits of the change, the whole risk and loss would fall upon others. The movement was easily turned into a war of classes; and the great, wealthy, and intelligent class which directed and paid for it conducted it so skilfully that multitudes of Englishmen even now look upon it as a brilliant exhibition of disinterested patriotism, and applaud the orators who delight in contrasting the enlightened and liberal spirit of English manufacturers with the besotted selfishness of English landlords" (p. 230). "I have not got acres enough to make me a Protectionist," said Arthur Pendennis, on the eve of entering Parliament.

result is an artificial distribution of capital and earnings. Such interference to be just and effective would demand superhuman reason.1 History, so far as we are able to interpret its lessons, confirms the teachings of the economists. We may also draw another lesson from history. While it is hardly conceivable that the able and intelligent men who are engaged in manufactures work against their own immediate interests when they advocate high protection for their products, their efforts in one way are certainly demoralizing. No country on earth, argued Webster in 1824, needs protection to its industries as little as the United States. "We need not resort," he declared, "to the clumsy helps with which, in less auspicious times, governments have sought to enable the ingenuity and industry of their people to hobble along."2 Now when manufacturers, ceasing to rely on their own ability and energy, appeal to Congress to make business better or to keep it from getting worse, do they not unite "with avowed contempt for 'abstract principles' and generalizations" an "unlimited faith in a motley assemblage of nominees of caucuses, ruled by ignorant and fanatical wire-pullers?"3 Or in their influence on legislation do not manufacturers betray "little anxiety that each shall have that which belongs to him, but great anxiety that he shall have that which belongs to somebody else?"4 And is it not as Webster in 1824 found it when he
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1'' The favors of government are like the box of Pandora, with this important difference, that they rarely leave hope at the bottom."—Economical Interpretation of History, Thorold Rogers, p. 378. Of England Huxley writes: "It appears to be universally agreed . . . that it is unnecessary and undesirable for the State to attempt to promote the acquisition of wealth by any direct interference with commerce."—Critiques and Addresses, p. 26.
2 Works, vol. iii. p. 188.
3 The quotations are from Herbert Spencer's Justice, p. 49. The people alluded to are those "brought up in the reigning school of politics and morals" and the "assemblage" is obviously the House of Commons.
4 Herbert Spencer's Justice, p. 44. Conditions in England are again referred to. "You cannot trust human nature to legislate from the point of view of its own interests."—Economic Interpretation of History, Thorold Rogers, p. 165.

said: "It is very remarkable, that when the losses and disasters of certain manufacturers, those of iron, for instance, are mentioned, it is done for the purpose of invoking aid for the distressed." 1

As the tendency of protective legislation is to make manufacturers look to a paternal government for help, when they ought to rely on their own efforts, so also does it lead statesmen to attribute to their legislation results due mainly to other causes. How frequent is the statement that the magnificent development of the iron industry in the past generation has been due to our protective policy! But in what has this progress consisted? It has consisted in: the cheapening of pig iron by improvements in the construction of the blast furnace, by the use of better fuel and less of the better fuel per ton of metal, by a study of effects brought about by a mechanical mixture of different ores, and by the introduction of chemical analysis in every stage of operation; by the practical application of the Bessemer process and the substitution of steel for iron; and by economy of work and the use of improved machinery in every department of manufacture.

To attribute a result produced by such causes to legislation is absurd. Not to the men at Washington is the development of the iron industry due. For that we must look elsewhere. We must regard the patient, attentive, intelligent furnace-manager watching his ores, scanning his fuel, observing the gas at the top and the slag at the bottom of his furnace, comparing his results with those of his neighbors, with those of other furnaces in America and with furnaces in England; the brilliant engineer to whom the success of the Bessemer steel industry of this country is a monument; the vigorous iron-master who first made iron and then made steel in many forms and wore out his brain in devices to extend the trade and make famous the name of his company and keep his army of men at work; the
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1 Works, vol. iii. p. 134.

steel-works manager who found chaos and left order, who constructed an admirable system and obtained results that are the envy of manufacturers—to these men and men of their kind are due the marvellous results that mark the history of the iron industry in this country. Would not these results have been obtained whether a tariff of 50 per cent.— which is the ideal of the protectionist—or a tariff of 20 per cent, levied on substantially the same articles—which is the ideal of the revenue reform statesman—had prevailed? The historian must answer the question in the affirmative. He will not say dogmatically that the gross product would now have been as great and the number of iron and steel works in the country as large, had the 20 per cent, tariff of 1857 been restored when we had got beyond the need of the war tariff; but he will affirm that the improvements, producing such grand results, would have been made, with the effect of an extraordinary development; and he can have no hesitation in asserting that to the ore and coal in the ground and to the brains of the men who have used them are due, in the main, the striking characteristics of the progress of the iron manufacture in our country.

Statesmen learn from economists slowly;1 and economists must reach the great mass of voters through statesmen or through the press. Were this not so, it might be a matter of surprise that so many intelligent business men of the United States hold to the doctrine of a high protective tariff, condemned as it is by the majority of economists. The impatience frequently exhibited by philosophers at the slow progress of ideas among practical people is repaid by the contempt of practical people for what they deem the barren speculations of closet theorists. They aver, with a considerable degree of truth, that schemes of government devised by philosophers have not always been successful in the working.
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1 See Economic Interpretation of History, Thorold Rogers, p. 391.

But once in a while we get the opinion of a very great mind on a subject of practical legislation—the opinion of a man who combines in the highest degree speculative wisdom with a knowledge of affairs; and once in a while we are fortunate enough to hear from that man when the enthusiasm of a vigorous manhood has not been chilled by the calculation of age and self-seeking; when he is not beset with clamorous delegations from his district, arguing and praying that some special interest may be protected by legislation, but when circumstances combine to enable him to make a careful, disinterested, and profound inquiry. Such a man was Webster at forty-two, and such were the circumstances when he made his speech in the House of Representatives against the tariff of 1824. His reasoning is deep enough for the economist, practical enough for men of affairs, and so clear that it may be safely said it would be difficult to find a Northern voter of American birth who could not fully comprehend it.

It was, moreover, the speech of as true an American as ever lived. Clay had christened protection the American policy.1 To this Webster objected. The so-called "American policy," he declared, "is what America has never tried. . . . Sir, that is the truest American policy which shall most usefully employ American capital and American labor, and best sustain the whole population. . . . The great interests of the country are united and inseparable; agriculture, commerce, and manufactures will prosper together or languish together; all legislation is dangerous which proposes to benefit one of these without looking to consequences which may fall on the others." 2

There is room for surprise and reflection when, in this debate, we hear Clay warmly commending the "complex mechanism " of the British protective system, and Webster intimating that England was prosperous and great, not on account of her prohibitory tariff laws, but in spite of them.
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1 Life of Clay, Schurz, vol. i. p. 216 ; Webster's Works, vol. iii. p. 95. 2 Speech of Webster against the tariff of 1824, Works, vol. iii. p. 96.

Webster, moreover, took occasion to say that English journalists, theorists, and scientific writers advanced the doctrines of freedom of trade.1 "There is a broad and marked distinction," he declared, "between entire prohibition and reasonable encouragement. It is one thing, by duties or taxes on foreign articles, to awaken a home competition in the production of the same articles; it is another thing to remove all competition by a total exclusion of the foreign article; and it is quite another thing still, by total prohibition, to raise up at home manufactures not suited to the climate, the nature of the country, or the state of the population.' Protection," he continued, " when carried to the point which is now recommended—that is, to entire prohibition—seems to me destructive of all commercial intercourse between nations. We are urged to adopt the system upon general principles. ... I do not admit the general principle; on the contrary, I think freedom of trade to be the general principle, and restriction the exception. . . . The balance of trade made its appearance in debate, and I must confess that I spoke of it . . . somewhat freely and irreverently. ... I did it simply for the purpose of laying the spectre and driving it back to its tomb. ... If the value of goods imported exceed the value of those exported, then the balance of trade is said to be against us, inasmuch as we have run in debt to the amount of this difference. Therefore, it is said that if a nation continue long in a commerce like this, it must be rendered absolutely bankrupt. It is in the condition of a man that buys more than he sells ; and how can such a traffic be maintained without ruin? Now sir, the whole fallacy of this argument consists in supposing that, whenever the value of imports exceeds that of exports, a debt is necessarily created to the extent of the difference, whereas, ordinarily, the import is no more than the result of the export, augmented in value by the
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1 Speech of Webster against the tariff of 1824, Works, vol. iii. p. 107. 2 Ibid., p. 108.

labor of transportation. The excess of imports over exports, in truth, usually shows the gains, not the losses, of trade; or, in a country that not only buys and sells goods, but employs ships in carrying goods also, it shows the profits of commerce, and the earnings of navigation. Nothing is more certain than that, in the usual course of things, and taking a series of years together, the value of our imports is the aggregate of our exports and our freights." 1

Webster, in words of truth that men must learn if they would understand the nature of trade between countries, went on to say : " Commerce is not a gambling among nations for a stake, to be won by some and lost by others. It has not the tendency necessarily to impoverish one of the parties to it, while it enriches the other; all parties gain, all parties make profits, all parties grow rich, by the operations of just and liberal commerce."2

To the argument that "the price paid for every foreign manufactured article is so much given for the encouragement of foreign labor, to the prejudice of our own," he had a pregnant reply: "But is not every such article the product of our own labor as truly as if we had manufactured it ourselves? Our labor has earned it, and paid the price for it. It is so much added to the stock of national wealth."3

Clay had asked " in a tone of interrogatory indicative of the feeling of anticipated triumph, to mention any country in which manufactures have flourished without the aid of prohibitory laws. . . . Sir," declared Webster, "I am
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1 Speech of Webster against the tariff of 1824, Works, vol. iii. pp. 116, 118. The quotation, and what follows (p. 119, et seq.) is the clearest, most concise, and most common-sense view of the balance-of-trade doctrine that I know of in literature. As a supplement to this, discussing, in 1888, the movement of securities and the different standards for debtor and creditor nations, see Thorold Rogers's Economic Interpretation of History, chap, xviii.; see also an acute article, entitled "Unbalanced Foreign Trade," in The Nation of February 11, 1892, where the writer says: "For the last thirty-five years England's balances of foreign trade have been steadily ' unfavorable,' and foot up for the whole period (1856-1890) the frightful sum of $18,250,000,000."
2 Ibid., p. 120.
3 Ibid., p. 129.

ready to answer this inquiry. There is a country, not undistinguished among the nations, in which the progress of manufactures has been far more rapid than in any other, and yet unaided by prohibitions or unnatural restrictions. That country, the happiest which the sun shines on, is our own." 1 Those of us who are ready to receive the truth as thus laid down by Webster, and believe that it applied in 1824, applies now, and will apply as long as commerce between civilized nations shall endure, will have no difficulty in understanding the tariff and financial history of the country from 1846 to 1860.

In 1850, iron-masters of Pennsylvania and manufacturers of Massachusetts went to Washington, hoping to get the tariff raised on their especial products; but Congress was too much occupied with the Compromise measures to lend an ear to their prayers.2 In September, Webster, who since 1828, had advocated protection, wrote to Harvey that it was too late that session to do anything with the tariff.3 President Pierce was fortunate in the selection of Guthrie, a wealthy lawyer of Louisville, Kentucky, as his Secretary of the Treasury. To rate Guthrie with our four great secretaries, who brought to bear upon finance their many-sided minds, would not be just, but among our financiers of the second rank he holds a high place. His four annual reports abound with sound economic notions, and had not the war of 1861 brought to an end the policy which he both represented and influenced, he would now have fame beyond the history-books. He opened the discussion in his first report. As the country had more revenue than it needed, Guthrie, holding the opinion that the tariff is a tax, recommended a revision of it by enlarging the free
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1 Speech of Webster against the tariff of 1824, Works, vol. iii. p. 137.
2 Pike to the New York Tribune, May 25, 1850, First Blows of the Civil War, p. 81.
3 Letter of September 13, 1850, Curtis, vol. ii. p. 475. For an explanation of Webster's change of views, see Lodge, p. 165; for Webster's defence, see his speech on the tariff of 1846, Works, vol. v. p. 186.

list and reducing the duties on dutiable articles. "The principle of free trade," he wrote, "may not yet be sufficiently verified from experience, in this and other nations, to justify its full adoption, but the progress towards free trade, now proposed, will be justified, it is believed, by both public opinion and public interest." 1 While the secretary did not propose a change in the system of ad valorem duties, he recommended a specific duty on iron, based on the average of the last three or four years' ad valorem duties.

Before Guthrie had occasion to make his next annual report, a stringent money-market and hard times distracted men's minds in some degree from the exciting political controversies of the year 1854.

Greater dulness than had been known since 1837 characterized the summer trade.2 Money was hard to get. The very best of paper sold at 10 to 12 per cent., and notes with good names went as high as 11/2per cent, a month. Money lenders looked askance at railroad acceptances. Illinois Central 7 per cent, bonds sold at 62, and New York Central sixes at 85 ½ 3 "Snow tells me," wrote Charles A. Dana to Pike, "he has sacrificed mining property for which he had paid $12,000 cash, and glad to get off so. Greeley has fared worse. Why, last week he had to let good lands in Pike County, Pennsylvania, on which he had paid $5000, go to the dogs because he couldn't raise $500. So we go, and the worst not come yet. We are lucky, who are not under the necessity of borrowing."4 Surprise was expressed at the failure of a Philadelphia dry-goods house, for their credit had been so good that their notes sold readily at 1 per cent. a month.5 The export of specie from the country was large.6
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1 Guthrie's Report of December 6, 1853.
2 New York Weekly Tribune, July 1 and August 19, 1854
3 Ibid., August 26 and September 2. 4 C. A. Dana to Pike, September 1, 1854. Pike's First Blows of the Civil War, p. 261.
5 New York Weekly Tribune October 7, 1854.
6 For the fiscal year ending June 30,1854, the net export of specie and bullion was in round numbers $34,500,000; year ending June 30, 1855, $52,500,000. But the production of gold in California was about $60,000,000 per annum. According to the report of the Secretary of the Treasury, March 2, 1854, there were held abroad of American securities, $202,922,937.

In September, 1854, there was a panic in Wall street;1 in November a series of financial disasters at the West and the South: many banks and bankers suspended payment.2 In New York, commercial paper sold at from 2 to 3 per cent, a month.3 When winter came, men lacked work; in New York City there was distress.4 When the trouble began, Greeley ascribed the cause of it to overtrading and extravagance;5 but as it grew, it is not surprising that the Tribune imputed the hard times to the Walker tariff, and indicated, as a certain remedy, the restoration of the tariff of 1842.6 This monetary difficulty was, however, but the precursor of the panic of 1857 ; the causes of it will appear when we come to discuss that financial crisis.

Guthrie, in his report of December, 1854, again called "the attention of Congress to the propriety of reducing the revenue from customs, so that no more money shall be received into the treasury than is required for an economical administration of the government." He proposed the removal of duties on most of the raw materials used in our manufactures; he recommended that the coarser wools be admitted free; and in his scheme he recognized the principle of reciprocity.7 The Secretary of the Treasury was backed by his party. "Protection," said the Democratic Review, "has succumbed to 'free trade.' . . . Indeed, its doom is
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1 See New York Tribune; W. G. Sumner, in First Century of the Republic, p. 254.
2 New York Weekly Tribune, November 18.
3 Ibid., November 4.
4 New York Tribune, January 15, 1855.
5 New York Weekly Tribune, July 1, 1854.
6 Ibid., November 25, 1854: the Daily Tribune, January 15,1855.
7 "In recognizing, as I do, the principle that duties should be levied for revenue, and not for protection, I have considered it no departure from the principle to counteract the legislation of other countries, and make the same articles free under our laws that are free under theirs."

manifest, and expediency alone serves as an apology for delaying its absolute annihilation." 1 A bill to reduce the tariff passed the House of Representatives late in February, 1855, but failed in the Senate more from want of time than from any other reason.

In his report of December, 1855, Guthrie argued that, as the principle of a tariff, or, as he termed it, taxes, for revenue only was conceded, the admission of raw materials free of duty would be a desirable step towards free trade. He showed that he understood the balance-of-trade doctrine as Webster expounded it in 1824. Yet he was not a rigid doctrinaire, being quite ready to admit that the consumer did not always pay the whole tax on the dutiable article, and that a reduction of duty did not always diminish the price to the consumer.

The tendency of opinion which had acted on Guthrie, and which he, in turn, by demonstrating economical principles, had influenced, was clearly shown in the Democratic national platform of 1856. "The time has come," it declared, "for the people of the United States to declare themselves in favor of free seas, and progressive free trade throughout the world, and by solemn manifestations to place their moral influence at the side of their successful example."2 Strange anomaly! This convention, completely out of tune with the enlightened sentiment of the world on slavery, was yet in advance of the age in its view of a commercial policy. That negro slavery and free trade were twin Democratic tenets is an opinion we frequently meet with in the decade of 1850-60; the association of these ideas was destined to have an influence that has lasted to our own time. Tariff reformers may have been amazed at the tenacity with which men in the most intelligent country districts, seemingly blind to their own interests, have clung to the notion of protection, but they must seek the reason
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1 December, 1854.
2 History of Presidential Elections, Stanwood, p. 203.

of it in opinions formed in the ten years before the war. Along the lines of New England influence, where the New York WeeklyTribune was read,1 the same people who were led to make the fight against slavery extension were moved to believe by Greeley's vigorous presentation of half-truths that protection to American labor by a high tariff was a necessary counterbalance to the system which involved the actual ownership of the working-man. Applying then to these communities Burke's remark, "The march of the human mind is slow,"2 and Spencer's statement," The bias of education and the bias of patriotism severally warp men's convictions,"3 we have a solution of what has undoubtedly puzzled those who advocate tariff reform.

In December, 1856, Guthrie submitted his most remarkable report. As the government still had more revenue than it needed, he was firmer than ever in the conviction that there should be a reduction of the revenue from customs. He gave evidence that he was a friend to the manufacturing industries of the country; he argued that, if we should take off the duties on raw materials, thus putting our manufacturers on a par with those of other countries, the incidental protection afforded by a revenue tariff, and the skill and enterprise of our people, would enable us to keep pace with any nation in the world. He illustrated his opinion by a reference to the iron industry. Owing to our natural advantages and our skill in making use of them, the production of iron and steel had since 1840 steadily increased, and, at the present rate of progress, we might fairly expect to produce, by the year 1870, all the iron we consumed. In the interest of the woollen manufacturers, he recommended free wool.

Hardly anything in this report calls for criticism. The argument in favor of the ad valorem system was based on the inexpediency of making a change in the policy of the
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1 See vol. ii. p. 71.
2 Works, Bohn's edition, vol. i. p. 486.
3 Sociology, vol. ii. p. 230,

past ten years. But he mentioned with candor the adoption by Great Britain of specific taxation on most dutiable articles, and of the home valuation on the residue.

The report was so fair and had such merit that it called forth the commendation even of Greeley. He approved the secretary's idea of placing " wool, silk, furs, hides, and skins," on the free list; he agreed with the recommendation to admit salt free, and was glad that Guthrie did not "even hint at a reduction of the sugar duty;" and he commended the manner in which the iron and steel industry was discussed. Greeley ended his article by saying that, although the report was not always right, it was on the whole a good one, and might be studied with profit; and he further took occasion to remark that James Guthrie was an " able and upright" Secretary of the Treasury.1

Just before his term of office expired, Guthrie had the satisfaction of seeing the tariff revised largely in accordance with his ideas. The Senate held an interesting discussion on the different plans proposed to carry out the secretary's repeated recommendations. Hunter, the chairman of the Senate committee on finance, argued that the surplus revenue should be cut down, and the accumulation of specie in the treasury stopped; for the overflowing treasury was a temptation to wild and extravagant schemes of expenditure, and had even given rise to suggestions of a plan of distribution of the surplus revenue among the States. The debate was non-partisan. Pugh, a Democrat of Ohio, disagreed materially with Hunter, a Democrat of Virginia, in regard to the proposed reduction on wool. Collamer, a Republican of Vermont, concurred with Pugh, while Wilson, a Republican of Massachusetts, was of the same mind as Hunter. Bigler and Brodhead, Democrats of Pennsylvania, criticised Hunter for his proposed reduction of iron duties.
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1 New York Weekly Tribune, December 6,1856,

While the Senate and the House were in accord that a reduction of the tariff should be made, they had different projects to bring about the desired end. The matter went finally to a committee of conference. Hunter, Douglas, and Seward represented the Senate; Campbell of Ohio and De Witt of Massachusetts, Republicans, and Letcher of Virginia, a Democrat, the House. The conferees agreed, and all signed the report. The House adopted the report by the non-partisan vote of 123 to 72; the Senate by 33 to 8. All the senators and representatives from Massachusetts and South Carolina, the one delegation entirely Republican, the other Democratic, voted for the bill. Thus the tariff bill of 1857 was enacted. This non-partisan measure—passing when the bent of the country was towards freer commercial intercourse, and when there was a lull in the hot contention about slavery and Kansas—would have been, but for its adherence to the ad valorem system, one of the best tariff laws ever enacted by Congress.1 Its operation showed it to be a little less than a 20-per cent. tariff.2 It did not have a fair trial, for one of the effects of the panic of 1857, which followed soon after, was a material reduction in the revenues of the country. To this tariff for revenue, therefore, could be urged the fatal objection that it did not provide sufficient money for the expenses of the government. With the revival of business this defect would have disappeared, and it is probable that had it not been for
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1 In the Senate, Bell, Bigler, Douglas, Mason, Pugh, Seward, Trumbull, and Wilson voted for it; Brodhead, Collamer, and Wade against it. In the House, Burlingame, Lewis D. Campbell, and De Witt voted for it; Colfax, Morrill, and Sherman against it. Greeley criticised the policy which found expression in this act, but did not share the forebodings of some regarding the future of our manufactures "incited by the obvious tendency of our legislation."—New York Weekly Tribune, April 11, 1857.
2 See Senate Report No. 2130, 2d Session 51st Congress The duty on pig-iron was 24 per cent. This made the duty for 1858 $4.20 per ton; for 1859, $3.65; for 1860, $3.40. All wool, valued at 20 cents per pound or less at the place of exportation, was free, which practically admitted all wool free. See Taussig, pp. 124, 150.

he civil war, protection would not later have had an important place in our tariff legislation.

If repeated warnings could prevent a financial crisis, that occurring in 1857 might have been averted. As early as March, 1857, the alarm was sounded.1 Set thy house in order, was the counsel of the Tribune; we are on the eve of great financial trouble, for we have run too deeply into debt abroad. In April Greeley wrote: "We are heavily in debt to Europe. Our city merchants and bankers owe those of Great Britain, the country owes the cities, the farmers owe the merchants—in short, two thirds of us are in debt."2 By June, the apprehensions of a crash were so general that Greeley took them as a text on which to preach an economic sermon. If the tariff of 1842 had not been changed, he asserted, we should now be exporting iron, hardware, and fabrics; we should not be buying such an enormous amount of goods from Europe, and draining ourselves of specie to pay for them.3 By the fourth of July, the complaint of hard times was heard: ready money was difficult to get. In August the suspended blow fell: on the 24th the Ohio Life Insurance and Trust Company of Cincinnati and New York failed, with reported liabilities of $7,000,000.4 The announcement of the failure on the New York Stock Exchange caused a panic; stocks fell; many bankers and brokers were unable to meet their engagements. Money rose to three, four, and five per cent, a month.5 Deposits ran down. Loans were contracted.6 September 25, the Bank of Pennsylvania at Philadelphia suspended. A run on all of the banks began. The presidents held a meeting, and resolved
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1 New York Weekly Tribune, March 28,1857.
2 Ibid., April 4,1857.
3 Ibid., June 27, 1857.
4 New York Independent, August 27; New York Times, August 28; William G. Sumner, First Century of the Republic, p. 254.
5 Banks of New York and the Panic of 1857, p. 345.
6 New York City banks contracted their loans, from August 22 to October 24, $25,000,000.

unanimously to suspend specie payments.1 The banks of Baltimore, Pittsburg, and Reading stopped payment. "The panic rages like the pestilence. Philadelphia having fallen, who shall now be safe?" asked an observer at Washington.2 Merchants and manufacturers were failing everywhere.3 The shipwreck of the Central America, bound from Aspinwall to New York, intensified the gloom. Besides the large loss of life, $2,000,000 of gold had gone to the bottom of the sea.

All eyes were on New York. During the first part of October the Illinois Central Railroad Company made an assignment, the notes of the New York and Erie Railroad Company went to protest, and the Michigan Central Railroad Company suspended payment on its floating debt.4 Amid wild excitement, a heavy run began on all of the New York banks.5 It was impossible for them to stand the drain. October 13, at half-past ten in the evening, the New York City banks resolved to suspend specie payments on the following day.6 But it was not the redemption of the circulating notes that broke the banks: it was the
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1 Philadelphia correspondence New York Tribune, September 26,1857.
2 Washington correspondence, see New York Weekly Tribune, October 3.
3 In 1857 there were in the United States and the British Provinces 6022 failures, with liabilities of $282,335,000. For the first three months of 1858, 1540 failures, with liabilities of $31,733,000.—Report of the Tappan, M'Killop Commercial Agency, History of the Commercial Crisis, 1857-58, Evans, p. 136 et seq.
4 New York Weekly Tribune, October 17.
5 "Tuesday (October 13) was par excellence our dies irae. No one who passed the doors of any of our leading banks, or took his stand at the corner of Wall Street and watched the affrighted groups who thronged to the counters or 'whispered with white lips' on the sidewalk, could avoid feeling the profoundest pity at the spectacle which met his gaze. If Nena Sahib were encamped at Yonkers at the head of 100,000 cut-throats, and were expected to butcher us to-morrow, the prospect could not produce more complete depression than was betrayed on the acutest mercantile visages in the community."—New York Times, October 16.
6 See picture of Wall Street on suspension day, Banks of New York and the Panic, p. 346.

withdrawal of the deposits.1 The banks of New England, of New York State, and of New Jersey now stopped payments of coin. Nearly every financial institution in the country had adopted the same course.2

The excitement of the past few weeks now gave way to torpor and debility.3 Merchants no longer had trade. The decline in the price of flour and pork was alarming.4 "These are emphatically hard times," wrote Greeley to his 200,000 subscribers. "The money value of nearly every description of property has suddenly depreciated from 25 to 75 per cent. The farmer's produce must be generally sold at this reduction, if sold at all; the manufacturer meets little demand for his fabrics at any price; the artisan, mechanic, and laborer are widely bereft of employment, or constrained to work for reduced wages, to famish and shiver in idleness, or to wander away from their families in dubious quest of something to do. Rich and poor alike suffer: those engaged in trade were the first victims; but all share in the common misfortune. And there seems to be little ground of hope for any but a gradual improvement, to be wrought out by patient industry and rigid economy."5 "There was never so much mental suffering in any two months as in the last five weeks," wrote Theodore Parker. "Think of men who never thought of want, except as the proud angels
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1 New York Weekly Tribune, October 17, 1857 ; Banks of New York and the Panic, note on p. 380. Specie in New York City banks, October 10,$11,476,294; circulation, $7,523,599; deposits, $49,745,176.—Ibid., p. 333. "At the time the New York City banks suspended specie payments in October, they reported a larger amount of specie in their vaults than their notes in circulation."—Report of Secretary of the Treasury Cobb, Dec, 1857. "Not a bank in New York City failed in 1857 having insufficient funds to pay every dollar of its circulation. Their notes circulated without loss of value during all the time that specie payments were suspended."—Bolles, Financial History of the United States, cited by Von Hoist, vol. vi. p. 119.
2 Tribune, October 17 and 24.
3 Ibid., October 24.
4 Von Hoist, vol. vi. p. 120; New York Herald, cited in History of the Commercial Crisis, 1857-58, Evans, p. 112.
5 This letter in fac-simile of Greeley's handwriting was published in the Weekly Tribune of November 28.

think of suffering—as something fit only for the 'lower classes'—now left without a dollar! The man who refused $30,000 for his house in Temple Place, when he wanted to sell before he went to Europe, saw it knocked down at auction for $19,000. Michigan State bonds have gone down from $1.25 to 66 cents. . . . All property is depreciated. My income will not be half this year what it was last. But 'I still live;' only I shall buy no books; and it makes a great gap in my charities." 1

The stoppage of manufacturing establishments, throwing large numbers of men out of work, was a serious feature of the situation. Many employers were bereft of their peace of mind in contemplating the want and suffering of mechanics and laborers who had wrought for them faithfully.2 The condition of affairs was the most grave in New York City, where, it was estimated, 30,000 to 40,000 men lacked employment.3

Mayor Fernando Wood, in a message to the Common Council, urging the prosecution of the public works, and recommending the purchase by the city of 50,000 barrels of flour and corresponding quantities of provisions to be given the laborers at cost prices in payment for their labor, added, by his remarks, fuel to the flame. "Truly may it be said," he declared, "that in New York those who produce everything get nothing, and those who produce nothing get everything. They labor without income, whilst surrounded by thousands living in affluence and splendor, who have income without labor." 4 November 2, a procession of the unemployed marched through the streets to the music of a drum, following a banner, on which was inscribed,
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1 Letter of October 19,1857, Life of Theodore Parker, Frothingham, p. 464.
2 "Business stops—that is the great calamity. ... In Lawrence there were three thousand five hundred, in Little Taunton one thousand five hundred, in Natick, in one week, two hundred men without work."—Letter of Theodore Parker, October 19, Life by Frothingham, p. 465.
3 New York Times, October 23. The population of New York City in 1855 was 629,810.
4 Ibid., October 23.

"Work—Arbeit." 1 Crowds of people cried: "Bread or Death." 2 On the fourth, a meeting, prompted by foreigners, was held in the City Hall Park, at which violent and menacing speeches and peremptory demands for employment were made.3 The Common Council received only a part of the mayor's suggestions with favor; the demonstrations continuing, it became known that they were in some measure due to a political manipulation in favor of Wood's candidacy for mayor at the approaching election. Threats were now made of attacking and plundering the sub-treasury and the banks in Wall Street.4 Daily meetings of the unemployed were held in Tompkins Square. On the 6th of November, 5000 gathered, and, when the speakers had finished, they formed in procession, and, with a banner, "We Want Work," marched to the Merchants' Exchange in Wall Street and thence to the City Hall. On account of this and subsequent demonstrations and threats of the speakers, that the hungry mob would break into the vaults of the sub-treasury and seize upon the twenty millions of specie said to be deposited there, a squad of fifty soldiers from Governor's Island, and fifty marines from the Navy Yard, were detailed to guard the government treasure.5

It seemed for the moment as if the prediction made by Macaulay six months before had come true; that the demagogue had appeared, "ranting-about the tyranny of capitalists and usurers, and asking why anybody should be permitted to drink champagne and to ride in a carriage while thousands of honest folk are in want of necessaries;" and that working-men, hearing their children cry for more bread, and the Huns and Vandals engendered by our institutions, would choose to high place the demagogue who had
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1 New York Times, November 3.
2 Harper's Magazine, January 1858.
3 New York Times, November 5, 1857.
4 Ibid., November 10; American Almanac for 1859, p. 365.
5 New York Times, November 13. It spoke, however, of "the farce of the United States troops guarding the custom-house."

flattered them.1 But at the close of election day, when the votes were counted, it was seen that the arts of Wood had not prevailed. The decent and orderly citizens elected their candidate for mayor.2

The panic broke forth in England. The causes there had been long generating, but the crisis in America was the occasion that brought them to a head. The discount rate of the Bank of England was raised to 10 per cent.; the bank act was suspended. The trouble in Lombard Street reacted on Wall and State Streets.3

By some hasty reasoners, the panic in the United States was charged to the reduction of the tariff made in March, 1857.4 But Greeley knew that such an argument could not hold. He sincerely believed, however, that, while there were several immediate forces tending to the crisis, the ultimate cause was the Walker tariff of 1846. With great power and without ceasing, the Tribune advocated this view;5 and its influence was potent and enduring. While the association of slavery with free trade has probably made a more lasting impression in the agricultural districts than the connection as cause and effect of the tariff of 1846 and the panic of 1857, yet in industrial centres the opinion grew—and maybe traced from 1857—that the hard
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1 See Macaulay's letter to H. S. Randall, May 23, 1857, appendix to Trevelyan's Life and Letters.
2 But only by a majority of 2331 in a vote of 83,233. New York Times, December 4,1857.
3 The Theory and History of Banking, Dunbar, p. 173; The Commercial Crisis, 1857-58, Evans, p. 34.
4 See, for example, a letter of David Wilmot, of September 26, New York Weekly Tribune, October 10. Wilmot was the Republican candidate for Governor of Pennsylvania. President Buchanan deemed the charge worthy of attention, for he argued against it in his message of December, 1858, as did also the Secretary of the Treasury in his report of 1858.
5 See especially the New York Weekly Tribune for October 3, October 10, November 14. The writer of the article of October 3 says: "The trash taught in our colleges [as political economy] is worse than nothing. It is simply a very stupid and very provincial echo of the fallacies of British free trade."

times under Buchanan were linked to a free-trade policy. Those who have taken into the mind Webster's reasoning of 1824 do not need to have the fallacy of this statement exposed in detail. The reasoners, moreover, who set about proving it must have been staggered to come upon such great effects from causes so slight—to see the commercial and financial fabric of the country shaken by the paltry 5per-cent. reduction of the tariff in each of the years 1846 and 1857.1
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1The Austrian economist, Max Wirth, in his standard history of Financial Panics, in a full analysis of the causes of the panic of 1857 in the United States, makes no mention of the tariff. He places especial emphasis on the speculation and speculative spirit engendered by the new supply of gold from California, and calls particular attention to the feeling on the part of the people in the spring of 1857 that their prosperity was unparalleled.—Wirth, Geschichte der Handelskrisen, pp. 334-359.
Some writers, who have ascribed the panic of 1857 to the tariff of 1846, argue that the large importations of goods resulting from the reduction of duties led to a heavy export of specie to make payments, and that this drain of specie brought on the panic. In this reasoning cause and effect are confused, and in part, at least, inverted. It was the export of specie which increased the importations of merchandise, and not the importations of merchandise which increased the export of specie. The discovery of gold in California naturally added gold to the staple exports of the United States. The transmission of gold to Europe thus became as normal a feature of trade as the export of cotton, according to the well-established laws governing the distribution of the precious metals. The only way to determine whether the export of specie exceeded what would be its normal export as a staple commodity is to compare the total production during this period with the total exportation.
Taking the nine years between the discovery of gold to the panic, from June 30,1848, to June 30,1857, the excess of the imports of merchandise over exports of merchandise amounted to 336 million dollars. The excess of the exports of specie over imports of specie was 271 million dollars (found by deducting from the excess of exports of silver and of domestic gold, 276 millions, the slight excess over imports of foreign gold, 4.8 millions). During these nine years there was therefore an excess of imports of merchandise over exports of merchandise and specie of 65 million dollars, too small an amount to be of serious consequence. During the same period there was a production of gold in the United States of about 477.5 million dollars (found by including the production of 1848, the most of which occurred after June 30, and one half the production of 1857, i.e., up to June 30). The production of silver during this period is estimated at somewhat less than one-half million, and may fairly be left out of account. Subtracting the net export of specie during this period from the production, it will be seen that there was a net increase of specie in the United States of about 206 million dollars. It is thus perfectly certain that the panic was not brought on by a loss of specie occasioned by excessive importation.
Wirth estimates that in this period the world's stock of gold was increased 1060 millions, and the stock of silver about 585 millions (p. 315), making a total of 1645 millions. Thus the United States, with a population of about 29,000,000 people, secured during this period one eighth of the increase of the world's stock of specie. This strikingly illustrates the error of ascribing the panic to a loss of specie. The figures in regard to the exports and imports and the production of gold are derived from the Statistical Abstract of the United States, 1890, pp. 52, 62, 63.
For the above note I am indebted to my friend Professor Edward G. Bourne, of Adelbert College. It clearly expresses my own belief. This is only a small part of the assistance I have had from Mr. Bourne on this chapter. He studied it thoroughly in manuscript, and his suggestions enabled me to enrich the notes and to treat more critically and more fully the economic and sociological topics considered in the text.

The reason of panics lies deep in the human heart. They occur in commercial countries, where the sentiment of confidence is well enough developed to build up an extensive system of credit; and it matters not whether the legislation tends to free trade or protection. The crisis of 1837 came when our progress was towards a revenue tariff; that of 1857 when duties were levied for revenue only; that of 1873 after twelve years, and that of 1893 after thirty-two years, of protection.

The most important element in bringing on the panic of 1857 was the expansion of credit, induced by the rapid building of new railroads, and by the new supply of gold from California.1 It fitted well that the failure of the Ohio Life Insurance and Trust Co., which had got into trouble by
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1 On this point, to show how Americans were discounting the future, Wirth cites a vivid sentence from the New York correspondent of the Allgemeine Zeitung: "The most rash enterprises were begun—railroads through unsettled regions with no local traffic, cities projected on worthless farm lands, steamer lines without profitable business, banks without specie" (p. 345).

loaning its own and borrowed funds to aid in railway construction,1 should usher in the crisis. Nearly 21,000 miles of railway were constructed from January 1, 1849, to January 1,1858. This was seven ninths of the total mileage of the country. The capital and indebtedness of the railroads was about $900,000,000,2 so that in nine years $700,000,000 had been invested in railway construction.' The work was done hastily and extravagantly. Poor rails were bought in England with bonds rated ruinously low. A popular estimate of our indebtedness abroad was $450,000,000,4 and, although an analysis of the movement of trade for nine years, as given in the official figures of exports and imports, does not confirm this notion, it is impossible to escape the conviction that we owed Europe largely. We had sent securities to Europe and taken the pay in goods: this, in part, accounted for the excessive importations which were a symptom of the condition of things that brought on the panic. An accessory cause was the expansion of bank loans and circulation. This came in part from the demand for money to be used in railroad construction. While the banks of New York were sound, and had not a circulation beyond the safety mark, Western banks had gone wild in their issues of paper. In the train of the too rapid railroad building and bank expansion came stock and real-estate speculation, 5 extravagance in living, and inordinate use of European luxuries.6
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1New York Independent, August 27; New York Times, August 28; W. G. Sumner, First Century of the Republic, p. 254.
2 Report of the Secretary of the Treasury, December, 1857.
3 In England, in the five years 1846-50 inclusive, 4150 miles of railway were built at an expense of $750,000,000. This was about half of the mileage in England in 1855.—Wirth, p. 251.
4 Life and Liberty in America, Mackay, vol. ii. p. 117. The highest estimate the New York Tribune had seen was $500,000,000.— Weekly of December 12, 1857.
5 The real-estate speculation was not nearly so great, however, as that which preceded the crisis of 1837.
6 New York Weekly Tribune; New York Times; Banks of New York and the Panic of 1857; Message of the President, Dec, 1857; Report of the Secretary of the Treasury, December, 1857. As illustrating the increased demand for European luxuries, Wirth, p. 448, gives an interesting table of importations for the years 1856-57.
ARTICLES FOR WOMEN.
Silks $28,699,681
Embroideries 4,443,175
Cotton insertings, trimmings, etc. 1,129,754
Shawls 2,256,351
Straw hats, etc. 2,246,698
Gloves 1,559,322
Jewelry 503,633
Total $40,838,614
ARTICLES FOR MEN.
Spirits $3,963,725
Wines 4,272,205
Tobacco and cigars 5,582.557
Total $13,818,487
This table is probably compiled from the figures in the American Almanac for 1859.
It is to be noted that these sums represent wholesale prices, and do not include what was imported free of duty. Wirth well remarks that this consumption of luxuries was not a cause of the panic, but a symptom of the condition of things which was bringing it on.

Immediately after the suspension, the New York City banks began to gain in specie; gold coming from England and California, they, as well as the Albany banks, felt strong enough, December 12, to attempt the resumption of specie payments, and this they accomplished successfully. Two days later the Boston banks did likewise.1 Deposits increasing, a more liberal policy in regard to loans was pursued. President Buchanan, in his message of December, 1857, laid at the door of the banks a larger share of the trouble than was justly their due, but he made one suggestion of real value—that the States ought to prohibit the issue of paper money in smaller denominations than twenty dollars. It is good education for the people that the money they habitually use should be gold and silver.

In the spring of 1858, there were hopes of reviving business,' but these proved delusive.' "The hard year of 1858

4, 1859. "The effects of the revulsion are now slowly but surely passing away."—President Buchanan's Message, December 6,1858.
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1 New York Times, December 14, 1857; American Almanac, 1859, p. 366.
2 Ibid., March 26, April 6, 1858.
3 See decline in prices of leading articles, June 30, 1857, to June 30, 1858, Report of the Secretary of the Treasury, December, 1858.

draws to a close," wrote Greeley from Racine, Wis., December 20, 1858. "The West is very poor. I think a larger proportion of the people of Michigan, Indiana, Illinois, Wisconsin, and Iowa are under the harrow now than at any former period. There is no real lack of money, provided one has wherewith to buy it; and what passes for money is a better article than that which usurped the name a year ago; but real estate, mortgages, railroad stocks and bonds, notes of hand, and promises of all kinds are not the sort of property that easily tempts a moneyed man to open his safe or his pocket-book. There is on all hands such a superabundance of debt of various kinds that promises are a drug, and faith in human solvency sadly alloyed by scepticism. Very many want to borrow; very few are anxious to lend, no matter at what rate or on what security. Railroads partly constructed, and there stopped for want of means; blocks of buildings ditto; counties and cities involved by the issue of railroad bonds, and practically insolvent; individuals striving to stave off the satisfaction of debts, obligations, judgments, executions—such is the all but universal condition." 1 Moreover, Greeley went on to say: the crops of 1858 were poor, there was little travel on the railroad, the half a dozen splendid hotels of Chicago, and the fine Newhall House, of Milwaukee, were far from full.2

Money had been easy during the summer of 1858. Call loans were made in New York at 3 to 4 per cent, per annum. The government 5-per-cent. loan was taken in this country at a premium of 4 5/8.3 The revenues of the government fell off. Twenty million of treasury notes were issued, and a loan for the same amount was made.

With the close of the year 1858 and the opening of 1859, it seemed as if a real improvement in business had begun.4
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1 New York Tribune, December 25, 1858.
2 See also New York Times, November 5,1858.
3 The Independent, August 12, 1858.
4 Ibid., December 30,1858; New York Tribune, January 20 and March 11,1859; New York Times, January 4,1859; New York Herald, February 9, 11, 19, and March 4, 1859. "The effects of the revulsion are now slowly but surely passing away."—President Buchanan's Message, December 6,1858.

The South was very prosperous. "There is no disputing the fact," wrote a correspondent from New Orleans, "that the southern portion of the Confederacy is in a highly prosperous condition—perhaps never more so. Of all the great staples produced, the crops during the past year have been abundant, sales active, and prices high. . . . No species of property has felt the effect of this state of affairs more sensibly than the negroes. The average price of field hands may be stated at $1500, and the tendency is upward. Al niggers sell for $1750 to $2000. These rates were never reached but once before, and that was during the speculative times of 1836. . . . The South is getting out of debt and beginning to accumulate surplus capital."1

In a large part of the country, however, the rising hopes, springing from the better outlook of affairs, were blasted by the June frost of 1859. In the early morning of June 5, the mercury went down to 32°: the frost killed the wheat, corn, potatoes, vegetables, and fruit of a considerable portion of New York, Pennsylvania, Ohio, Indiana, and Illinois.' John Brown wrote from Akron, Ohio, that the frost had been very destructive in western New York and Ohio. "Farmers here," he said, "are mowing the finest-looking wheat I ever saw, for fodder only." 3

In 1860, business was actually becoming good. The credit of the government remained high, United States 6-per-cent. stocks selling at 117.4 Another season of commercial prosperity had begun, and would undoubtedly have continued, had it not been checked by political troubles and war.

President Buchanan had, in his message of December, 1858, recommended a revision of the tariff for the purpose
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1 New York Times, March 25, 1859.
2 Ibid., June 7 and 10, 1859; New York Herald, June 9.
3 Life of John Brown, Sanborn, p. 526.
4 Wilson, U. S. Senate, December 8, 1859.

of increasing the revenue. The Tribune called for a moderate increase of the tariff, "in the interest of our depressed and languishing national industry."1 "But," wrote Pike from Washington, "nothing can be done with the great body of the Democratic party, which is a Southern planters' and slavery party, devoted to free trade, and against anything and everything that favors Northern or free-State interests."2 In accordance with the President's recommendation, backed by the Secretary of the Treasury, the administration leader in the House asked leave to introduce a bill revising and increasing the tariff, but he could not obtain the necessary two-thirds vote for his proposition. He had with him 111 members from the free, and 17 from the slave States; against him 66 from the slave, and 22 from the free States.3 "How comes it," asked Greeley, a year later, "that every champion of eternal and universal slavery is also an intense free-trader? What is the 'mystic tie that binds' these two seemingly unrelated theories of fettered labor and unfettered trade in such intimate and loving union ?" 4
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1 December 24,1858.
2 New York Tribune, February 4, 1859; see also Atlantic Monthly, November 1857, p. 120.
3 Ibid., February 28, 1859.
4 bid., February 22, 1860.


Source: Rhodes, James Ford. History of the United States; from the compromise of 1850 to the final restoration of home rule at the south in 1877, v.3. New York: Macmillan, 1910 [c1892].