Passage of the public credit act of 1869 which

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passage of the Public Credit Act of 1869, which promised to pay the war debt in "coin."Holders of war bonds expected no less; in fact, they expected payment in coin, althoughmany had bought their bonds with greenbacks!With investors reassured by the Public Credit Act, Sherman guided legislation throughCongress that swapped the old short-term bonds for new ones payable over the nextgeneration. In 1872 another bill in effect defined "coin" as "gold coin" by dropping thetraditional silver dollar from the official coinage. Through a feat of ingenious compromise,which placated investors and debtors, Sherman preserved the public credit, the currency,and Republican unity. In 1875 he engineered the Specie Resumption Act, which promisedto put the nation effectively on the gold standard in 1879, while tossing a few moreimmediate but less important bones to Republican voters who wanted "easy money."Grant, no financial theorist, signed this act.The Republican leadership acted not a moment too soon, because when the Democratsgained control of the House in 1875, with the depression in full force, a verbal storm brokeout. Many Democrats and some Republicans passionately demanded that the silver dollar
be restored in order to expand the currency and relieve the depression. These "free-silver"advocates secured passage of the Bland-Allison Act of 1878, which partially restored silvercoinage. The law required the treasury to buy $2 million to $4 million worth of silver eachmonth and turn it into coin but did not revive the silver standard. In 1876 otherexpansionists formed the Greenback party, which adopted the debtors' cause and fought tokeep greenbacks in circulation. But despite the election of fourteen Greenbackcongressmen, they did not get even as far as the free-silver people had. As the nationemerged from depression in 1879, the clamor for "easy money" subsided, only to resurge inthe 1890s. The controversial "money question" of the 1870s, never permanently solved,gave politicians and voters another reason to focus on new northern issues and forget aboutthe South.The Supreme Court of the 1870s also played a role in weakening northern support forReconstruction. In the wartime crisis, few cases of note had come before the Court. Afterthe war, however, constitutional questions surged into prominence.First, would the Court support congressional laws to protect freedmen's rights? Thedecision inEx parte Milligan(1866) suggested not. In this case, the Court declared that amilitary commission established by the president or Congress could not try civilians inareas remote from war where the civil courts were functioning. Thus special militarycourts to enforce the Supplementary Freedmen's Bureau Act were doomed. Second, wouldthe Court sabotage the congressional Reconstruction plan, as Republicans feared? Theirqualms were valid, for if the Union was indissoluble, as the North had claimed during thewar, then the concept of restoring states to the Union would be meaningless. InTexas v.

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Term
Spring
Professor
B.Rice
Tags
Reconstruction, Southern United States, Reconstruction era of the United States, President Johnson, black suffrage

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