154 



CONGRESS, UNITED STATES. 



desire for becoming rapidly rich, without much 

 regard to the means, and a reckless spirit of ex- 

 travagance in expenses pervaded the whole peo- 

 ple. The immense amounts of the Treasury 

 notes issued and in circulation at the close of 

 the war, and the hundreds of millions of Uni- 

 ted States bonds afloat in the market, which 

 really constituted the debt of the nation, the 

 debt of the whole people, soon began to be 

 looked upon as the capital of the nation and its 

 people. The unnatural stimulus of such an in- 

 flation of the currency encouraged a reckless 

 spirit of speculation, and drew men into the 

 undertaking of numerous and gigantic enter- 

 prises far in advance of the legitimate demands 

 of healthy business. 



"Railroads especially were projected every- 

 where ; not only to meet the present wants of 

 commerce, but with the sole idea of creating 

 business where it did not exist ; running hun- 

 dreds of miles through forests or prairies or 

 deserts without an inhabitant, and depending 

 upon future settlements to furnish business to 

 the roads. The existing trunk lines were 

 loaded down with the branches which they 

 undertook to construct, and which would not 

 pay running expenses then, and some of which 

 do not to-day; and fin ally the Northern Pacific 

 Railroad, that abortion of the last decade, 

 which should only have been undertaken in 

 the next generation, was projected and com- 

 menced. All these roads issued bonds and 

 stocks which were thrown upon the market, 

 and large sums were invested in them. They 

 bought and speculated in each other's bonds 

 and stocks, treating them as so much reliable 

 capital. The iron manufacturers enlarged their 

 works and machinery to meet the increased 

 demands which so many roads were expected 

 to require. Some of the iron companies also 

 issued bonds and stocks. They sold their iron 

 in large quantities for the bonds and stocks of 

 these railroad companies, and went on enlarg- 

 ing their works and increasing their produc- 

 tion. This is but a sample of all the other 

 great business enterprises of the day, all of 

 which were carried on largely upon credit; 

 and all had come to look upon each other's 

 stocks and bonds, and frequently upon their 

 own liabilities, as so much actual capital, as 

 they had before looked upon the debt of the 

 nation as the capital of the nation : as if the 

 day of payment was never to come. 



*' All kinds of business were buoyant, brisk, 

 lively, and apparently prosperous beyond ex- 

 ample in the history of the world. Labor was 

 in demand and wages high ; prices were infla- 

 ted, purely fancy and almost fabulous, 'and 

 all went merry as a marriage bell,' for the 

 time and the multitude were so short-sighted 

 as to suppose such a state of things could en- 

 dure forever ; as if the real prostration caused 

 by the war could be finally got over in this 

 pleasant way. Now this, in my opinion, then 

 and now, was exactly the period of disease in- 

 stead of health in the body politic, which had 



been excited and stimulated into an unnatural 

 and feverish frenzy of exaltation, far above the 

 healthy and normal equilibrium of its powers. 

 A state of intoxication and unnatural exhilara- 

 tion sure, inevitably sure, to make the patient 

 sink as far below his normal condition as the 

 stimulus had raised him above it ; a state in 

 which all men saw visions, dreamed dreams, 

 and built air castles, and took them for reality 

 and sober truth. 



" But just in this stage of the disease, when 

 all seemed gold that glittered, there burst forth 

 in New York, like a clap of thunder in a clear 

 sky, the dismal shriek, ' The Northern Pacific 

 Railroad has collapsed ; Jay Cooke is a bank- 

 rupt! ' And in a few hours this cry had been 

 carried over the wires to every corner of the 

 Union, bringing a chill to the hearts of thou- 

 sands who had invested their treasures in its 

 bonds and others directly or indirectly con- 

 nected with that enterprise. And at once the 

 holders, not only of these bonds, but the hold- 

 ers of all the bonds and stocks of other abor- 

 tive railroad projects (for all were more or less 

 connected with and dependent upon the others), 

 began to tremble. 



"The people began to open their eyes; and 

 down went one after another of those abor- 

 tive railroad projects. All stocks and bonds 

 felt the shock ; and through the whole series 

 one knocked down another, like a set of blocks 

 set up by children for amusement. All the 

 bright visions had been dissipated, and a con- 

 gestive chill succeeded the fever of exaltation 

 which had preceded it. All began to open 

 their eyes to the fact that debts were not capi- 

 tal ; and distrust took the place of confidence. 

 All then saw that, like insects, they had only 

 been lifted into the region of imaginary pros- 

 perity upon a hollow bubble, by the explosion 

 of which they had been sunk deeper into the 

 mire than if they had never clung to its glitter- 

 ing film. Down went the iron men with mil- 

 lions of the worthless bonds of such companies 

 in their hands and with large stocks of iron 

 for which there was no demand ; and all de- 

 pendent upon them or connected with them 

 went down with them. Works were stopped 

 or greatly reduced in efficiency. Laborers be- 

 fore employed in the various railroad projects 

 and at the forge were thrown out of employ- 

 ment, and the stocks of iron would only sell 

 at reduced prices. 



" This is but a sample. All other great busi- 

 ness enterprises took a similar course ; and the 

 people woke up to the fact that all were in 

 debt and none could pay. And capital, always 

 timid, shrunk from undertaking or continuing 

 business enterpriseo which gave employment 

 to laborers ; and the hard times were upon us. 

 Such, in brief, were the causes of the hard 

 times and distress by which the country has 

 been afflicted, and not the want of a sufficient 

 volume of currency, which business and enter- 

 prise would not venture to use, had it been 

 issued. Whatever the amount of currency not 



