Page:The Republican Party (1920).djvu/80

 American market with American-made goods in place of foreign, often of better quality and at lower prices than the foreign; and at the same time an abundant revenue to be applied not only to the current expenses of government but also to the extinguishment of the public debt. Another copious source of governmental income was found in the internal revenue, especially the tax upon alcoholic liquors and tobacco. This had originated as a war measure, but it was generally recognized as highly desirable for continuance in time of peace. And although it was not until 1875 that a law was enacted providing for the resumption of specie payments making “greenbacks” and national bank notes as good as gold on January 1, 1879 such action was long before anticipated and the fiscal policy of the government was early directed to that end.

It was not all easy going. Back in President Johnson's administration an attempt had been made to reduce the volume of treasury notes in circulation. This meant contraction of currency, and that had an unfavorable effect upon business; wherefore Congress enacted a law forbidding any further such attempts. Later, under President Grant, the contrary course was essayed. It was thought that business depression was due to lack of circulating medium, and a bill was passed providing for a considerable increase in the issue of “greenbacks.” This was done by the Democratic Congress which was elected in 1874, the first Democratic Congress since before the war. President Grant and his Republican advisers rightly perceived that such inflation of the currency would make more difficult if not impossible the resumption of specie payments at the appointed time and would really aggravate