CHAP. ment." Nov. Among the results of that law had been a great fall in the price of silver and a corresponding rise in that of gold. After a discussion in both Houses at intervals, lasting for nearly three months, Congress repealed the 1893. portion of the bill that pertained to the purchase of silver bullion. The unsettled business of the country still continued, the repeal of the silver-purchase law having scarcely an effect, if any at all, upon the financial and industrial affairs of the Union. 1. In connection with the repeal just mentioned it may be noted that the most important legislation of Mr. Cleveland's second administration was the passage of the "Reformed Tariff," popularly known as the Wilson-Gorman Bill,-thus designated from the names of the respective chairmen of the committees of the House and the Senate. The discussion on this tariff began in the regular session of the Fifty-third Congress Dec. 19, 1893, lasting to Aug. 15, 1894. The bill was sent to the President, who refused either to sign or veto it, because he regarded it as not such a reform of the tariff as he had advocated and as his Democratic supporters had promised-promises which had gained them the election. The Wilson Bill, as passed by the House, had been changed and corrupted by the Senate under lead of the Gorman Committee. The bill was a botch, embodying the most objectionable features of both protection and anti-protection. Mr. Cleveland declined to be responsible for it, and let it become a law by the lapse of time it remained in his hands. This act produced in a very short time sad effects upon the main industries of the land, even more distress, especially upon the workpeople, than the previous forebodings of evil had anticipated. The speedy transition from the unusual prosperity of the wage-earners to that of extreme distress was unprecedented. Soon CLEVELAND'S SECOND ADMINISTRATION. 1169 LXXV. their deposits in the savings banks were exhausted, and CHAP. great numbers of these worthy people, especially in the cities, were compelled to become beneficiaries of charity. In respect to the revenues of the general Government, they also began to fall off,-both the internal revenue, because of the universal stagnation of business, industrial and commercial, and also that derived from import duties. In regard to the latter, when it became certain that the new tariff, with its lower duties, would be enacted by Congress, at once the importers began to hold back their goods from market in the bonded warehouses, so as to pay no customs till they could get the benefit of the reduced duties. During this time scarcely any duties were paid, and the national revenue to that extent fell off. When the expected tariff was enacted, these goods were passed through custom-houses at a comparatively low rate of duty and in vast quantities; they glutted the market and, in connection with the cautionary curtailment of our manufacturers already mentioned, reduced for many months the production of home manufactures, for, costing less, they of course undersold the domestic goods. In consequence, the duties paid by this great influx of foreign merchandise fell far below the financial necessities of the Government. Thus, for the first time in twenty-seven years the Government was unable to pay any portion of the national debt, and our characteristic of being the only debt-paying nation was marred. On the contrary, the Government was compelled to borrow money for its current expenses by issuing bonds to the amount of $262,000,000. In this connection we will anticipate. Toward the close of Mr. Cleveland's second administration these foreign importers took a course which in a manner was the reverse of the former one. The presidential elec LXXV. CHAP. tion in 1896 gave assurance that the new Republican majority would return to the time-honored principle of protecting the nation's industries by a judicious financial measure. The importers therefore brought in an immense quantity of foreign manufactured goods, under the existing low tariff, and poured them forth in such abundance as to overstock the market for a year, if not more. Thus the Government failed to receive what was properly its due in import duties. Meanwhile the full progress of American manufacturing industries was also retarded for a year or more. In an off-year election, that held in November, 1894, came the greatest revulsion ever known in respect to the members of Congress. The Fifty-third Congress, elected in 1892, had a Democratic majority in the Senate of seven, and in the House of ninety-six. The Fifty-fourth Congress, elected in 1894, had a Republican majority in the Senate of four, and in the House of one hundred and forty-four. History shows that during the previous thirty-three years there were only two years in which the Democratic party had a majority in both Houses of Congress, though during that period the lower House, owing to what was called the "Solid [Democratic] South," had a corresponding majority much oftener than had the Republicans. Of course there must have been reasons which induced this radical and decisive reversal of opinion on the part of the majority of the people, as manifested by their votes in 1894. These reasons are found in legislative measures, which when put in practice affected injuriously the industries of the whole country, especially the interests of the wage-earners. Mr. Cleveland and the new Congress had undone much of what the Harrison administration had done. The first instance on this line of action was in the case of the Hawaiian Islands. A bill authorizing their annexa CLEVELAND'S SECOND ADMINISTRATION. 1171 LXXV. tion as territory to the United States had passed the CHAP. House and was in possession of the Senate, but that body, for lack of time, had been unable to pass it before the Fifty-second Congress ended. Mr. Cleveland at once asked the Senate for the bill, which he kept in his own hands while in office. He did not believe in the measure, and the annexation was delayed four years. The McKinley Bill had authorized the President, in order to remove misapprehensions that might arise, to make reciprocity treaties-with consent of the Senatewith other nations in relation to duties imposed upon merchandise passing from one to the other in the form of trade. When Mr. Cleveland entered upon his sec- 1893. ond term about twenty of these treaties were in existence all the outcome of mutual concessions made in a friendly spirit. To these treaties the provisions of the Wilson-Gorman tariff law were more or less obstructive. An instance or two will illustrate the advantages secured to the American people by these treaties. We import an immense amount of rubber free of duty from Brazil as raw material to use in certain of our manufactures. By treaty for the first time this was counterbalanced by Brazil reducing the duties on a great number of our various exports to that country. A treaty was also made with Spain, of mutual benefit to both parties. By agreement we admitted Cuban sugar free of duty and in return Spain reduced the rate of duty on a great number of our exports to her territories. One item may illustrate: the tax on American flour was $4.62 a barrel, which was reduced to 90 cents, while in consequence of this treaty our trade with Cuba alone was increased seventy per cent. The new Congress, without consulting Spain, violated this treaty by reimposing a duty on sugar, while on account of similar legislation Brazil gave notice of withdrawal from the treaty. That free sugar was a boon to those of limited means in the March. 4. LXXV. CHAP. Union is made clear by the increase of fifty per cent. in its importation. The rich and the well-to-do never stinted themselves in the use of sugar at their tables, but those of limited means were now compelled to deny themselves. In addition was introduced other legislation hostile to the production of sugar in some of the Southern States, and also to that obtained from sugar-beets. This sugar legislation was popularly interpreted as a favor to our great sugar-refining trust and was one of the reasons of President Cleveland's refusal to sign the Wilson-Gorman bill. This kind of legislation predominated in that bill, which in its effect prostrated more or less all our industries that came in competition with the low wages paid operatives in Europe. (There seems to be a general difference of opinion between Congress and the men elected to administer the executive and diplomatic business of the country, for similar reciprocity treaties negotiated by President McKinley's administration have been refused confirmation by the Congress of 1900–1901.) However, the new Democratic Congress was held responsible for all these blunders, and it was no wonder, as we have seen, that under a sense of wrong the majority of the people were indignant, and in the election of 1894 put their veto upon such incompetent statesmanship by changing the majority in both Houses of Congress. The change was remarkable in the case of the wage-earners, most of whom voted in 1892 in favor of the promised cheap goods under the proposed "Reformed Tariff." They were also duped by the specious electioneering slogan, "Let us have a change, anyway," which was proclaimed throughout the land. The cheap goods came, but the wage-earners had no money to buy their wages were diminished, while for the most part they themselves were out of employment. In consequence they saw their error, and went back to the party |