Whlle the Supreme Court was thus busy, like Penelope with her web, patiently undoing the work which it had as patiently done, public opinion concerning the currency drifted far away from the safe moorings where it had rested from the foundation of the government.

During the discussion which preceded the passage of the national bunk acts of 1863 and 1864, it was invariably and clearly set forth, in executive documents and Congressional debates, that the issue of United States notes was a temporary and doubtful measure, only justified by the controlling necessity of the times, while the bank act was a permanent provision for a sound. uniform, and convenient paper currency.

The act, which was finally passed in 1863, was submitted to the committee on ways. and means by Secretary Chase in December, 1861, and. then contained a provision for a temporary issue of United States notes, to relieve the treasury during the interval before the organization of the national banks, which were expected to furnish both a market for the bonds and a currency which could be safely received for taxes. This transformation of the banking system. has been shown, encountered the unanimous opposition of the State banks, and Congress dared not then proceed with it. The section providing that "for temporary purposes" the secretary should be authorized to issue United States notes, was presented and passed as an independent proposition,1 and the notes were made a legal tender. Yet, during the discussion of this bill, Mr. Hooper, of Massachusetts, took occasion elaborately to explain the proposed banking system, which was " designed to be more permanent" in its character, and upon the expected results of which, he said, the pending measure was in some degree based. " We all know," said Mr. Fessen-den, when the bill came to the Senate, "that it was resorted to as a temporary measure." The opponents of the bill contended that it was the inauguration of a new and ruinous policy, and must therefore be rejected; but the majority replied, in the language of Mr. Sherman, that it was "a mere temporary expedient." "We dare not repeat this experiment a second time," he added; "if we do, we enter on the same course that was followed in the French revolution, and also by our American ancestors." Mr. Sumner, as he reluctantly gave his vote for the bill, uttered the warning which has passed into a proverb, that " The medicine of the constitution must not become its daily bread."

1 The bill, as reported, expressly affirmed that the notes were to be issued "for temporary purposes."- Congressional Globe, January 28,1862, p. 522.

The attention of Congress was recalled to the proposed bank act by Secretary Chase in December, 1862. "The issue of United States notes," he wrote, "if exclusive, is hazardous and temporary; the security by national bonds of similar notes furnished to banking associations is comparatively safe and permanent." In his message to Congress, of the same date, President Lincoln expressed great doubt whether a circulation of United States notes, payable in coin and sufficiently large for the wants of the people, could be "permanently,usefully, and safely maintained," and recommended the organization of banking associations under a well-guarded national law. When the bill for the organization of such associations came up in the Senate. Mr. Sherman commended it expressly because as soon as the war should be over and the national bonds at par with gold and silver, the banks would become specie- paying banks. "During the war," he said, "the greenbacks are necessary to carry on the government." "It will be toward the close of the war," said Mr. Spaulding in the House, "that this measure will be most valuable in providing a way for funding the public debt and establishing a permanent system of national currency."

In his report for December, 1863, Secretary Chase announced that "the great work of introducing a permanent national currency," in distinction from the temporary legal tender currency, had been "entered upon in a spirit and with an energy promising perfect success." Except through the national banking system, he said, "no sure way is seen to the complete and permanent establishment of a uniform currency." When Congress entered upon the revision of the bank act recommended by the secretary in this report, a few members expressed a preference for the legal tender currency, to which the country was then becoming accustomed. To them Mr. Hooper replied, that "To confine the right of issuing paper for currency to the treasury department would seem to be a permanent arrangement for an irredeemable currency. When the act was passed authorizing the issue of legal tender notes," he continued, "no one advocated it as a permanent measure, but only as a temporary expedient to meet the emergency that existed after the banks suspended specie payments at the close of the year 1861." He proceeded to show that the government could not get its hills into circulation, in time of peace, "Without assuming the functions of a bank by loaning its notes," and the objection to this expedient he considered too manifest to need any discussion. "If this bill is a Success," said Mr. Sherman in the Senate, "I have no doubt that, within a very few-years after the Avar is over, there will be no currency but national currency and gold and silver coin." This, Mr. Sherman said, was also the expectation of Secretary Chase -that the notes of the United States would be funded and retired, and nothing would be left but the national bank currency and coin.

In December, 1864. President Lincoln, in his annual message to Congress the hope that very soon there might be no bank-note circulation in the United States not secured by the government; and Congress, acting upon the suggestion of Secretary Fessenden, proceeded to lay a 10 per cent, tax upon the bills of State banks. It had previously been decreed that the issue of United States notes should never exceed $400,000,000. It was now determined that the bank currency should be limited to the $300,000,000 authorized by the national government.