Evening journal., 1911-04-08
NEW NEWS OF YESTERDAY
The Gentle Threat That Got
Uncle Sam His First
Civil War Loan
By "HOIlsnd."

Il have always thought that II was
Secretary of the Treasury Salmon p.
Chase's gentle threat, made to group
of bankers whom he met in April, 1861
that decided the bankers Of the East
to accept his proposition that We take
fifty millions Of Government bonds on
q six per cent. basis and pay fifty mil
| lion dollars in gold therefor" So said
the late George S. Coe, one of the
I leading bankers Of the United States
at the time of the Civil War, now on
the eve of its semi-centennial. And
as / look back upon that first meeting
with Lincoln's Secretary Of the Treas
ury a meeting which occurred about six
weeks after Lincolns Inauguration, l
am often impressed by the idea that
this was both personally and in it's
effect upon national finance the most
important Of the meetings of the bank
ers Of the United States with Treasury
officials during the~entire civil war.
I'VE bankers knew that the credit Of
the United States was practically gone.
In the latter part of Buohanans adj
ministration II was practically impos-
sible to negotiate a loan by the Gov
ernment excepting upon ruinOus terms.
There was no money In the Treasury
when Secretary Chase took charge
II was a question whether he was go
ing TO be able 10 meet current ex-
penses We knew the Secretary of the
Treasury as a man who had been
prominent in politics. very active I'm
anti-slavery movements. Governor and
Senator of his State. but there was
nothing. so far as we knew, In his
career that justified us In believing
that he had the slightest practical
knowledge of finance or Of banking
We supposed that he had been made
Secretary of the Treasury solely for
political reasons.
"At the Secretarys request there
was a gathering of Eastern bankers in
April. 1861. which. for convenience
sake, met In New York City He came
over from Washington TO talk with the
bankers OF course, we were all very
curious about him and the plans which
he intended to lay before us. A lurk-
ing belief was in the mind of each one
of us that here was a neophyte or
amateur financier ready TO expond TO
us very practical government finance.
For we knew that he wanted to bor-
row gold. But what was he going to
say? How was he going to persuade
us?
Well, instead Of a man conscious Of
his own importance, puffed up with a
sort Of heavy dignity, there stood be-
fore us in the person of the Secretary !
of the Treasury, a man of very gentle |
manner, modest in his demeanor and |
apparently with no sense of great au-
thority. We were favOrably impressed. !
Then he made It clear to us that be |
regarded us as the real financiers, and |
fhaf ho nnlxr a ~ fpf g
icer He told us that he wanted to |
negotiate for the Government at Wash |
ington a loan of fifty millions in gold, |
for which he would give us Govern |
ment bonds upon six per cent. basis. |
l shall never forget the looks of in |
quiry that passed from one to another
of the bankers who were gathered
around the table. For a time no one
said word. Il was evident that we
we're all wondering whether the credit
Of our Government. justified agreeing
to these terms.
Il think Secretary Chase noticed our
hesitation and understood its meaning. |
for az last he said,
Well. gentlemen, hope YOU will
think it advisable to accept the offer ] |
now make you. If you do not. 7 shall /
nave 70 make use of other resources
which ] have as Secretary of the 4
Treasury. | want to say to you that we
are entering upon a civil war which |
may be long continued and very ex-
pensive, and I also want to say to YOU /
that If 7 cannot secure funds needed to |
carry on that war in any other way. |
snail issue Government notes and keep /
on issuing them. until this rebellion is |
suppressed, even though in time it |
costs you thousand dollars to buy a
beef steak and ten thousand dollars !
for a barrel of -four.
Behind the Jest we saw the earn !
estness and determination Of the Sec |
retary, and everyone of us from that
moment had confidence in the purpose
and ability of the Government 10 sun
press insurrection. We also had perfect
confidence in the ability Of the Govern
ment 10 redeem its bonds when the
time came and ! think before Secre- |
tary Chase sat down we were all of us
OF one mind for we told him that he
could return TO Washington with the
tull assurance that we would make
the loan upon the terms he requested
ana we never had to pay thousand
dollars for beef steak "
Copyright, 1911, by f. J. Edwards AM
Rights ReservedD
Vn Monday Mr.. Edwards will fell of
"Ihe First Meeting Of ThurIow Wood
| and MflInrd EfIIp,nr, 49,"