CHAPTER XII Estimate of McKinley's First Term Ο N the 4th of March, 1897, William McKinley assumed the duties of the exalted office of President of the United States. It was a time of marked industrial depression. Business and commerce were lagging, and large numbers of people throughout the country were seeking employment. The platform upon which he had been elected declared for a change in our tariff laws which would recognize more fully the protective principle, and for the enactment of a law which would firmly establish gold as the monetary standard of the nation. The new president, without hesitation, assembled Congress in extraordinary session, and addressed to it a message urging a revision of the existing tariff laws, under which business was suffering, while a deficiency in revenue was endangering the nation's credit and the stability of its currency. This prompt action in convening Congress, and the resultant passage of the Dingley law, unquestionably hastened the return of national prosperity. Under that law revenues revived, and with stable tariff conditions assured, the industries of the country slowly recovered from their depression. The intimate relations existing under the old financial laws between adequate revenues and the credit of governmental currency soon led to a restoration of public confidence; and even before the passage of the gold-standard law, gold was freely offered at the Treasury in exchange for greenbacks. CURRENCY REFORM The deficiency in revenues under the Wilson law, and the commercial panic of 1893, with the ensuing business depression, had exposed the inherent weakness of our currency system. This weakness resulted from a disproportion between the demand currency liabilities of the Government and the gold in the Treasury to redeem them; while the awkward fact existed that after these currency liabilities had been redeemed in gold they could again be paid out for expenses, thus enabling the public to present them again for redemption, causing what was commonly known as the "endless chain." After the success of the Republican party upon its platform of sound money, in a campaign in which this weakness formed one of the chief subjects of discussion, several plans of currency and banking reform were presented to the public and discussed generally in the press. It is highly creditable to the President's discernment and breadth of view that he avoided complicated recommendations, confining himself to urging the enactment of a provision which would remedy the weakness of our financial system without involving the business of the country in the dangers incident to radical legislative experiments with currency laws. His recommendation, made in his first annual message and repeated in his second, went to the very gist of the trouble; and it is the corner-stone of the financial law which Congress passed at its session in March, 1900. In his first annual message to Congress, the President said : "I earnestly recommend, as soon as the receipts of the Government are quite sufficient to pay all the expenses of the Government, that when any of the United States notes are presented for redemption in gold and are redeemed in gold, such notes shall be kept and set apart and only paid out in exchange for gold." In his second annual message to Congress, after renewing his recommendation of the year before, he said : "In my judgment the condition of the Treasury amply justifies the immediate enactment of the legislation recommended one year ago, under which a portion of the gold holdings shall be placed in a trust fund from which greenbacks should be redeemed upon presentation, but when once redeemed should not thereafter be paid out except for gold." To the President's plain and simple presentation of a fundamental remedy, and his avoidance of the recommendation of extensive and experimental plans, the people of the country largely owe the present stable and safe condition of our entire financial system. THE ANNEXATION OF HAWAII Almost as if foreseeing by intuition the necessity for the annexation of Hawaii, as later revealed by the tremendous events of the following years, the President early in his administration recommended to Congress the annexation of those islands, the movement towards which had been decisively checked by the preceding President. The importance of this step, both from the standpoint of the best interests of the islanders and of our own people, now seen so clearly by all, was not then so apparent; and, but for the earnest and aggressive attitude of the President, annexation would have failed. During the pendency of the Hawaiian question, speaking of the islands, he said to a visitor: "We need Hawaii just as much as, and a good deal more than, we did California." The annexation of these beautiful islands was the first step in the new and broader life upon which this republic has entered, and from which neither duty nor self-interest will allow it to turn back. THE MERIT SYSTEM The delicate problem of such a revision of the merit system of civil service as would remove therefrom the dangers to its permanence, arising from too rigid application of theory, was for many months a subject of the most serious consideration by the President and the members of his cabinet, and the operation of the amendments finally adopted is daily proving their wisdom. The country sees the rise and disposition of questions of great moment to its welfare, but, from want of knowledge of details, |