The Silver Issue

A remarkable manifesto, dated February 22, 1895, summarized the grievances of the Populists in these words:

As early as 1865-66 a conspiracy was entered into between the gold gamblers of Europe and America to accomplish the following purposes: to fasten upon the people of the United States the burdens of perpetual debt; to destroy the greenbacks which had safely brought us through the perils of war; to strike down silver as a money metal; to deny to the people the use of Federal paper and silver—the two independent sources of money guaranteed by the Constitution; to fasten upon the country the single gold standard of Britain, and to delegate to thousands of banking corporations, organized for private gain, the sovereign control, for all time, over the issue and volume of all supplemental paper currency.

Declaring that the "international gold ring" was summoning all its powers to strike at the prosperity of the country, the authors of this address called upon Populists to take up the gauntlet and meet "the enemy upon his chosen field of battle," with the "aid and coÖperation of all persons who favor the immediate free coinage of silver at a ratio of 16-1, the issue of all paper money by the Government without the intervention of banks of issue, and who are opposed to the issue of interest-bearing government bonds in the time of peace."

There was nothing new in this declaration of hostility to bank issues and interest-bearing bonds, nor in this demand for government paper money, for these prejudices and this predilection had given rise to the "Ohio idea," by force of which George H. Pendleton had hoped to achieve the presidency in 1868. These same notions had been the essence of the platforms of the Greenback party in the late seventies; and they had jostled government ownership of railroads for first place in pronunciamentos of labor and agricultural organizations and of third parties all during the eighties. Free silver, on the other hand, although not ignored in the earlier period, did not attain foremost rank among the demands of the dissatisfied classes until the last decade of the century and more particularly after the panic of 1893.

Prior to 1874 or 1875 the "silver question" did not exist. In 1873 Congress, moved by the report of a commission it had authorized, had demonetized silver; that is, it had provided that the gold dollar should be the standard of value, and omitted the standard silver dollar from the list of silver coins. ¹ In this consisted the "Crime of '73." At the time when this law was enacted it had not for many years been profitable to coin silver bullion into dollars because silver was undervalued at the established ratio of sixteen to one. In 1867 the International Monetary Conference of Paris had pronounced itself in favor of a single gold standard of currency, and the principal countries of Europe had preceded the United States in demonetizing silver or in limiting its coinage. In 1874 as a result of a revision of the statutes of the United States, the existing silver dollars were reduced to the basis of subsidiary coins with only limited legal tender value.

The Act of 1873 was before Congress for four sessions; every section, including that which made gold the sole standard of value, was discussed even by those who later claimed that the Act had been passed surreptitiously. Whatever opposition developed at this time was not directed against the omission of the silver dollar from the list of coins nor against the establishment of a single standard of value. The situation was quickly changed, however, by the rapid decline in the market price of silver. The bimetallists claimed that this decline was a result of the monetary changes; the advocates of the gold standard asserted that it was due to the great increase in the production of silver. Whatever the cause, the result was that, shortly after silver had been demonetized, its value in proportion to gold fell below that expressed by the ratio of sixteen to one. Under these circumstances the producers could have made a profit by taking their bullion to the mint and having it coined into dollars, if it had not been for the Act of 1873. It is not strange, therefore, that the people of those Western States whose prosperity depended largely on the silver mining industry demanded the remonetization of this metal. At the same time the stringency in the money market and the low prices following the panic of 1873 added weight to the arguments of those who favored an increase in the quantity of currency in circulation and who saw in the free and unlimited coinage of silver one means of accomplishing this end. So powerful was the demand, especially from the West, that in 1878 the Bland-Allison Act, passed over the veto of President Hayes, provided for the restoration of the silver dollar to the list of coins, with full legal tender quality, and required the Treasury to purchase in the open market from two to four million dollars' worth of bullion each month. This compromise, however, was unsatisfactory to those who desired the free coinage of silver, and it failed to please the champions of the single standard.

For ten years the question of a choice between a single standard or bimetallism, between free coinage or limited coinage of silver, was one of the principal economic problems of the world. International conferences, destined to have no positive results, met in 1878 and again in 1881; in the United States Congress read reports and debated measures on coinage in the intervals between tariff debates. Political parties were split on sectional lines: Western Republicans and Democrats alike were largely in favor of free silver, but their Eastern associates as generally took the other side. Party platforms in the different States diverged widely on this issue; and monetary planks in national platforms, if included at all, were so framed as to commit the party to neither side. Both parties, however, could safely pronounce for bimetallism under international agreement, since there was little real prospect of procuring such an agreement. The minor parties as a rule frankly advocated free silver.

In 1890, the subject of silver coinage assumed new importance. The silverites in Congress were reËnforced by representatives from new States in the far West, the admission of which had not been unconnected with political exigencies on the part of the Republican party. The advocates of the change were not strong enough to force through a free-silver bill, but they were able by skillful logrolling to bring about the passage of the Silver Purchase Act. This measure, frequently called the Sherman Law, ¹ directed the Secretary of the Treasury to purchase, with legal tender Treasury notes issued for the purpose, 4,500,000 ounces of pure silver each month at the market price. As the metal was worth at that time about a dollar an ounce, this represented an increase, for the time being, over the maximum allowed under the Bland-Allison Act and more than double the minimum required by that measure, which was all the Treasury had ever purchased. But the Silver Purchase Act failed to check the downward trend in the value of the metal. The bullion in a silver dollar, which had been worth $1.02 in 1872, had declined to seventy-two cents in 1889. It rose to seventy-six in 1891 but then declined rapidly to sixty in 1893, and during the next three years the intrinsic value of a "cartwheel" was just about half its legal tender value.

Even under the Bland-Allison Act the Treasury Department had experienced great difficulty in keeping in circulation a reasonable proportion of the silver dollars and the silver certificates which were issued in lieu of part of them, and in maintaining a sufficient gold reserve to insure the stability of the currency. When the Silver Purchase Act went into operation, therefore, the monetary situation contributed its share to conditions which produced the panic of 1893. Thereupon the silver issue became more than ever a matter of nation-wide discussion.

From the Atlantic to the Pacific the country was flooded with controversial writing, much of it cast in a form to make an appeal to classes which had neither the leisure nor the training to master this very intricate economic problem. W.H. Harvey's Coin's Financial School was the most widely read campaign document, although hundreds of similar pamphlets and books had an enormous circulation. The pithy and plausible arguments of "Coin" and his ready answers to questions supposedly put by prominent editors, bankers, and university professors, as well as by J.R. Sovereign, master workman of the Knights of Labor, tickled the fancy of thousands of farmers who saw their own plight depicted in the crude but telling woodcuts which sprinkled the pages of the book. In his mythical school "the smooth little financier" converted to silver many who had been arguing for gold; but—what is more to the point—he also convinced hundreds of voters that gold was the weapon with which the bankers of England and America had slain silver in order to maintain high interest rates while reducing prices, and that it was the tool with which they were everywhere welding the shackles upon labor. "Coin" harped upon a string to which, down to the time of the Spanish War, most Americans were ever responsive—the conflict of interests between England and the United States. "If it is claimed," he said, "we must adopt for our money the metal England selects, and can have no independent choice in the matter, let us make the test and find out if it is true." He pointed to the nations of the earth where a silver standard ruled: "The farmer in Mexico sells his bushel of wheat for one dollar. The farmer in the United States sells his bushel of wheat for fifty cents. The former is proven by the history of the world to be an equitable price. The latter is writing its history, in letters of blood, on the appalling cloud of debt that is sweeping with ruin and desolation over the farmers of this country."

When many men of sound reputation believed the maintenance of a gold standard impossible what wonder that millions of farmers shouted with "Coin": "Give the people back their favored primary money! Give us two arms with which to transact business! Silver the right arm and gold the left arm! Silver the money of the people, and gold the money of the rich. Stop this legalized robbery that is transferring the property of the debtors to the possession of the creditors.… Drive these money-changers from our temples. Let them discover your aspect, their masters—the people."

The relations of the Populist party to silver were at once the result of conviction and expediency; cheap money had been one, frequently the most prominent, of the demands of the farming class, not only from the inception of the Greenback movement, as we have seen, but from the very beginning of American history. Indeed, the pioneer everywhere has needed capital and has believed that it could be obtained only through money. The cheaper the money, the better it served his needs. The Western farmer preferred, other things being equal, that the supply of currency should be increased by direct issue of paper by the Government. Things, however, were not equal. In the Mountain States were many interested in silver as a commodity whose assistance could be counted on in a campaign to increase the amount of the metal in circulation. There were, moreover, many other voters who, while regarding Greenbackism as an economic heresy, were convinced that bimetallism offered a safe and sound solution of the currency problem. For the sake of added votes the inflationists were ready to waive any preference as to the form in which the cheap money should be issued. Before the actual formation of the People's Party, the farmers' organizations had set out to capture votes by advocating free silver. After the election of 1892 free silver captured the Populist organization.

Heartened by the large vote of 1892 the Populist leaders prepared to drive the wedge further into the old parties and even hoped to send their candidates through the breach to Congress and the presidency. A secret organization, known as the Industrial League of the United States, in which the leaders were for the most part the prominent officials of the People's Party, afforded for a time through its lodges the machinery with which to control and organize the silverites of the West and the South.

The most notable triumph of 1893 was the selection of Judge William V. Allen, by the Democrats and Independents of Nebraska, to represent that State in the United States Senate. Born in Ohio, in a house which had been a station on the "underground railroad" to assist escaping negroes, Allen at ten years of age had gone with his family to Iowa. After one unsuccessful attempt, he enlisted in the Union Army at the age of fifteen and served from 1862 to the end of the War. When peace came, he resumed his schooling, attended college, studied law, and in 1869 was admitted to the bar. In 1884 he went to Madison County, Nebraska, where seven years later he was elected district judge by the Populists. Reared in a family which had been Republican, he himself had supported this party until the campaign of 1890. "I have always," said he, "looked upon a political party … simply as a means to an end. I think a party should be held no more sacred than a man's shoes or garments, and that whenever it fails to subserve the purposes of good government a man should abandon it as cheerfully as he dispenses with his wornout clothes." As Senator, Allen attracted attention not only by his powers of physical endurance as attested by a fifteen-hour speech in opposition to the bill for the repeal of the Silver Purchase Act, but also by his integrity of character. "If Populism can produce men of Senator Allen's mold," was the comment of one Eastern review, "and then lift them into positions of the highest responsibility, one might be tempted to suggest that an epidemic of this Western malady would prove beneficial to some Eastern communities and have salutary results for the nation at large."

In this same year (1893) Kansas became a storm-center in national politics once more by reason of a contest between parties for control of the lower house of the legislature. The returns had given the Republicans a majority in the assembly, but several Republican seats had been contested on suspicion of fraud. If the holders of these seats were debarred from voting, the Populists could outvote the Republicans. The situation itself was fraught with comedy; and the actions of the contestants made it nothing less than farce. The assembly convened on the 10th of January, and both Republican and Populist speakers were declared duly elected by their respective factions. Loftily ignoring each other, the two speakers went to the desk and attempted to conduct the business of the house. Neither party left the assembly chamber that night; the members slept on the benches; the speakers called a truce at two in the morning, and lay down, gavels in hand, facing each other behind the desk, to get what rest they could. For over two weeks the two houses continued in tumultuous session. Meanwhile men were crowding into Topeka from all over the State: grim-faced Populist farmers, determined that Republican chicanery should not wrest from them the fruits of the election; equally determined Republicans, resolved that the Populists should not, by charges of election fraud, rob them of their hard-won majority. Both sides came armed but apparently hoping to avoid bloodshed.

Finally, on the 15th of February, the Populist house retreated from the chamber, leaving the Republicans in possession, and proceeded to transact business of state in the corridor of the Capitol. Populist sympathizers now besieged the assembly chamber, immuring the luckless Republicans and incidentally a few women who had come in as members of the suffrage lobby and were now getting more of political equality than they had anticipated. Food had to be sent through the Populist lines in baskets, or drawn up to the windows of the chamber while the Populist mob sat on the main stairway within. Towards evening, the Populist janitor turned off the heat; and the Republicans shivered until oil stoves were fetched by their followers outside and hoisted through the windows. The Republican sheriff swore in men of his party as special deputies; the Populist governor called out the militia.

The situation was at once too absurd and too grave to be permitted to continue. "Sockless" Jerry Simpson now counseled the Populists to let the decision go to the courts. The judges, to be sure, were Republican; but Simpson, ever resourceful, argued that if they decided against the Populists, the house and senate could then impeach them. Mrs. Lease, however, was sure that the Populists would not have the courage to take up impeachment proceedings, and the event proved her judgment correct. When the struggle was finally brought to an end with the assistance of the judicial machinery, the Republicans were left in control of the house of representatives, while the Populists retained the senate. In joint session the Republicans could be outvoted; hence a silver Democrat, John Martin, was sent to Washington to work with Peffer in the Senate for the common cause of silver.

The congressional and state elections of 1894 revealed the unstable equilibrium of parties, and at the same time the total Populist vote of nearly a million and a half reflected the increasing popular unrest. In the West, however, the new party was not so successful in winning elections as it had been in 1892 because the hostile attitude, sometimes of the Populists and sometimes of the Democrats, made fusion impossible in most cases. A few victories were won, to be sure: Nebraska elected a free-silver Democrat-Populist governor, while Nevada was carried by the silver party; but Colorado, Idaho, Wyoming, Kansas, and North Dakota returned to the Republican fold. In the South, the fusion between Populists and Republicans against the dominant Democrats was more successful. From several States, Congressmen were elected, who, whether under the name of Populist or Republican, represented the radical element. In South Carolina the Democratic party adopted the Farmers' Alliance platform, swept the State in the elections, and sent "Pitchfork" Tillman to the United States Senate as an anti-administration Democrat. Tillman admitted that he was not one of those infatuated persons who believed that "all the financial wisdom in the country is monopolized by the East," and who said, "'Me, too,' every time Cleveland grunts." "Send me to Washington," was his advice to cheering crowds, "and I'll stick my pitchfork into his old ribs!"

Every political move in 1895 was calculated with reference to the presidential election of 1896. Both old parties were inoculated with the free-silver virus; silver men could have passed a free coinage bill in both houses of Congress at any moment but were restrained chiefly by the knowledge that such a measure would be vetoed by President Cleveland. The free coinage of silver, which was the chief demand of Populism, was also the ardent desire of a majority of the people west of the Alleghanies, irrespective of their political affiliations. Nothing seemed more logical, then, than the union of all silver men to enforce the adoption of their program. There was great diversity of opinion, however, as to the best means of accomplishing this union. General Weaver started a movement to add the forces of the American Bimetallic League and the silver Democrats to the ranks of the People's Party. But the silver Democrats, believing that they comprised a majority of the party, proceeded to organize themselves for the purpose of controlling that party at its coming national conventions; and most of the Populist leaders felt that, should this movement be victorious, the greatest prospect of success for their program lay in a fusion of the two parties. Some there were, indeed, who opposed fusion under any conditions, foreseeing that it would mean the eventual extinction of the People's Party. Prominent among these were Ignatius Donnelly of Minnesota, "General" J.S. Coxey of Ohio, and Senator Peffer of Kansas. In the South the "middle-of-the-road" element, as the opponents of fusion were called, was especially strong, for there the Populists had been coÖperating with the Republicans since 1892, and not even agreement on the silver issue could break down the barrier of antagonism between them and the old-line Democrats.

It remained, then, for the political events of 1896 to decide which way the current of Populism would flow—whether it would maintain an independent course, receiving tributaries from every political source, eventually becoming a mighty river, and, like the Republican party of 1856 and 1860, sweeping away an older party; or whether it would turn aside and mingle with the stream of Democracy, there to lose its identity forever.