The sun. [volume] (New York [N.Y.]) 1833-1916, 1907-12-15
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Il was in the capacity Of chairman OF the
Finance Committee of the Senate. a position
30 which he was assigned at the begin
ming Of Lincoln's administration. nat Mr..
Fessenden entered upon the severest and
most responsible duties of his life. II
is to be- noted that he resisted. though
unavailingly. the proposal to make the
nO~n-interest bearing Treasury notes (popu-
larry known as -g~reenbacks") a legal tender
in payment Of all debts. public and private.
Having failed to strike out the legal tender
clause Mr.. Fessenden argued in favor Of
making the proposed issue OF $500, 900, 1000
in bonds ~redeemable at the pleasure OF
he Government after five years and pay
able after twenty. This was done. On
June rs, 1854. Senator Fessenden reported
the Loan act. providing ways and means
for the coming fiscal Ear 1t authorized
"a loan Of $500. 900. 900. The Senat accepted
it as reported. Two days later Secretary
Chase resigned the Treasury and Mr..
Fessenden was appointed his successor.
He declined the appointment in a letter
which Mr.. Lincoln. however. refused TO
accept.
II would be hard to ~exaggerate the en-
barrassments and perplexities which sur
AOuIAAhcu LAO AAV@1uAy WhCh ~
became Secretary on July S. 1884. From
the statement Of the Governments financial
condition made to him at that time il
was patent that by October 1 the large
sum Of S3l2. 900. 900 must be provided. and
there was the prospect Of n demand for
SITS. 900. 900 additional for the payment
Of a temporary loan and the 100 bonds
IL the aspect OF public affairs should cOn-
tinue ~unfavOrable. What were the means
with which these liabilities were to be met?
The answer made to the new Secretary
Of the Treasury in the summer OF 1854
threatened bankruptcy. The estimated
revenue for the ensuing quarter was only
S5l. 900. 900. or a daily average OF S550,OOO
scarcely more than enough TO meet the
maturing certificates Of indebtedness alone.
It followed that leaving out Of view tho
possible demands from the temporary
debt the Treasury must raise from loans
within the quarter 1921 600. 900. of which
500, 600, 600 was required forthwith. The
total Of the public indebtedness on July
S. 1854. was 81. T02, 600, 900. of which only
1855, 900. 900 was in the shape Of permanent
or funded debt. The remaining part OF
the indebtedness. amounting to more than
one billion dollars. was made up Of the 1905
of 1881 soon coming due. the legal tenders.
fractional currency. temporary loans.
certificates OF indebtedness. one and two
year notes and compound interest notes.
The magnitude Of the public debt was not
its worst feature. Much Of il was Of a
temporary nature and was about to be-
come due.
The financial policy adopted by Secretary
Fessenden may be outlined briefly. He
resolved. in the first place. that he would
avoid if possible a further increase in the
currency, and secondly. that all temporary
obligations then outstanding should at the
earliest practicable moment be paid or
consolidated. Thirdly. Mr.. Fessenden de-
termined that the current liabilities should
if possible be met with current receipts,
or from loans obtained for such a length
of time as would avert the necessity of
providing for them again during the con-
tinuance Of hostilities. Before the expira-
ton of the eight months during which Mr..
Fessenden held the Office Of Secretary of
the Treasury there were indications that
the receipts would enable the Government
to meet promptly the maturing liabilities.
that the certificates Of indebtedness would
be paid when presented. and that all the
mOHcy nCtuCu WOulu NC ShPDhCu ny tI0
people. When Mr.. Fessenden retired from
the department he felt no anxiety as TO
the suhiciency of the means 10 meet all
demands upon Il. The receipts from
customs and from internal revenue were
rapidly enlarging under the operations
of ne Act of Congress. and while the income
from customs proved considerably greater
than the estimates the internal revenue
was by the end OF the year 1895 more than
800. 900. 600 larger thar had been calculated.
Assistant Secretary Harrington in his ac-
count of the management Of the Treasury
by MIR. Fessenden points out that "by a
firm will. a clearly defined and well sus-
tanned policy and unfinching consistency
he bridge leading from threatened bank
ruptcy has been built and h affairs Of
the Treasury rave been conducted 70 a
position Of comparative safety" Mr.. Har-
rington added that il would be impossible
to depict in words the perplexities. annoy
ances and harassing anxieties to which
the heads of the Treasury Department
were subjected during the four years of
civil war. They had been expected to
provide not only for the present but for
the unknown future. Whatever sum might
be demanded for to-day was sure to be
followed by a demand for a larger amount
tomorrow. The securities of the Govern
ment had apparently replaced all the
boarded wealth of the country. and had
reached an aggregate bewildering to Euro
pean intelligence When Mr.. Fessenden
resigned his Office he knew that the close
Of the war would charge the position Of
the Secretary from one OF unremitting
solicitude to I'll the Treasury TO the more
simple one Of determining the wisest way Of
emptying il.
When he consented. much against his viii
to take the post of Secretary Of the Treasury
Il was with the understanding between
President Lincoln and himss.f that no
should be at liberty 10 resign as soon AZ
the aspect OF public Affairs was sufficiently
favorable % permit him % rgtirp. On