Reminiscences of Sixty Years in Public Affairs, Vol. 2

G >> George S. Boutwell >> Reminiscences of Sixty Years in Public Affairs, Vol. 2

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On the 15th day of January, 1872, I renewed my request in writing,
after having had several conversations with the officers on the
subject, and received an answer which, with the letter of request, is
hereto annexed.

In this, their most recent communication, they express a willingness
to enter the account in our joint names as I suggested, regarding it,
however, as a "personal account" and requiring that you should "join
in the request and concur in the conditions proposed before either
party can in that case draw upon the account."

As I must now almost daily draw from the account for money with which
to pay bonds, I cannot join your name therein until you have sent me
a written compliance with the conditions which they set forth, because
to do so would shut me out from the account altogether for several
weeks.

Besides, having no instruction from you on the subject, I don't know
that you would care to give written directions as to the deposit. I
know very well that, in case of my sudden decease, you would be glad
enough to find that you could at once avail yourself of the whole
amount of money here on deposit, and so I should have joined your name
as I have stated. Now you can do as you please. I have taken every
possible precaution within my power, and have no fear that the
arrangements are insufficient to protect the Government in any
contingency whatever. With the correspondence which has passed between
the officers of the Bank and myself, and our conversation together, the
account is sufficiently well known to them as a U. S. Government
deposit, and is fully enough stamped with that character, as I intended
it should be, however much they may ignore it now.

But for still greater caution, I made the written declaration of trust
on the very day of the first deposit, signed and sealed by me,
declaring the money and account as belonging to our Government, and not
to me, a copy of which is hereto annexed.

I also gave written instruction to Messrs. Bigelow and Prentiss to
draw all the checks, and how to draw them and keep an account thereof.
As I make all my purchases through Jay Cooke, McCullough & Co., every
check is in fact payable to that house, so that the account is easily
kept, and the transactions cannot be mingled with others, for there
are no others. I annex a copy of these instructions.

This, I believe, will give you a pretty correct idea of the
difficulties which have been presented to me in the matter of taking,
keeping, and paying out the money arising from the sale of the bonds,
and the manner in which I have met them.

I may add that when the officers of the Bank were satisfied that I was
not to withdraw the money and take it to New York, they reduced the
rate of interest and there has been an easy market ever since.

There are now on deposit more than twelve million dollars; but I hope
it will be reduced very fast next month. Had you not sent over the
last ten million of bonds, we should have been able to close up very
soon. I hope now that you will make another call of twenty million at
least, because I think it would enable us to purchase more rapidly.

I annex:
(1) Copy of declaration of trust.
(2) Copy of instructions for drawing checks.
(3) Copy of letter from Cashier of Bank of England, stating that the
account would be considered personal.
(4) Copy of my letter to the Governor of the Bank, asking that your
name might be joined.
(5) Copy of reply to last mentioned letter.

I am, very respectfully,
Your obedient servant,
(Signed) WILLIAM A. RICHARDSON.

When Cooke & Co. had completed their undertaking, the deposits in the
Bank of England exceeded fifteen million dollars, and for three months
they were for the most part unavailable, as the five-twenty bonds which
had not matured under the calls that had been made were above par in
the market. It was a condition of the loan that the five-twenty bonds
redeemed should equal the 5 per cent bonds that had been issued, both
issued to be reckoned at their par value.

In the month of April, 1872, the Commissioners who had been designated
under the Treaty of Washington of 1871 to ascertain and determine the
character and magnitude of the claims that had been preferred by the
United States against Great Britain, growing out of the depredations
committed by the "Alabama" and her associate cruisers, were about to
meet at Geneva for the discharge of their duties.

The administration had appointed the Hon. J. C. Bancroft Davis, the
most accomplished diplomatist of the country, as the agent of the
United States, and the preparation of "the Case of the United States"
was placed in his hands.

The British Ministry discovered--or they fancied that there was
concealed in covert language--a claim for damages, known as
"consequential or indirect damages"--in other words, a claim to
compensation for the value of American shipping that had been driven
from the ocean and made worthless through fear of the cruisers that had
been fitted out in British ports.

This claim, in the extreme form in which it had been presented by Mr.
Sumner, had been relinquished by the Administration, and a present
reading of "the Case of the United States" may not justify the
construction that was put upon it by the British Ministry.

Nevertheless, the Administration received notice that Great Britain
would not be represented at the Geneva Conference.

The subject was considered by the President and Cabinet on three
consecutive days at called sessions. At the final meeting I handed
a memorandum to the President, which he passed to the Secretary of
State. The memorandum was not read to the Cabinet.

Mr. Adams, the Commissioner for the United States, had not then left
the country. By a despatch from the Secretary of State Mr. Adams
was asked to meet me at the Parker House in Boston, on the second day
after the day of the date of the despatch.

What occurred at the meeting may be best given through an extract from
the diary of Mr. Adams, which has been placed in my hands by Mr.
Charles Francis Adams, Jr., with the privilege of its full and free
use by me.

The first entry is under date of Saturday, April 20, 1872, and is in
these words: "Charles brought me a telegram from Governor Fish,
desiring me to meet Mr. Boutwell, who will be at the Parker House
at eleven o'clock on Monday." The second entry is under date of
"Monday, 22d of April."

"At eleven o'clock called on Mr. Boutwell, the Secretary of the
Treasury, at Parker's Hotel, according to agreement. Found him
alone in his minute bedroom. He soon opened his subject--handed over
to me a packet from Governor Fish, and said that it was the desire of
the Government, it I could find it consistent with what they
understood to be my views of the question of indirect damages, that I
would make such intimation of them to persons of authority in London
as might relieve them of the difficulty which had been occasioned by
them. I told them of my conversation held with the Marquis of Ripon,
in which I had assumed the heavy responsibility of assuring him that
the Government would not press them. I was glad now to find that I
had not been mistaken. I should cheerfully do all in my power to
confirm the impressions consistently with my own position."

Thus, through Mr. Adams, the claim for "indirect damages" was
relinquished. When the fact of the disturbed relations between the
United States and Great Britain became public there was a panic in
the London stock market, and in the brief period of eight and forty
hours our deposit of twelve million or more in the Bank of England was
converted into five-twenty United States 6 per cent bonds, purchased
at par.

In my annual report for December, 1872, I was able to make this statement:

"Since my last annual report the business of negotiating two hundred
million of 5 per cent bonds, and the redemption of two hundred million
6 per cent five-twenty bonds has been completed and the accounts have
been settled by the accounting officers of the Treasury.

"Further negotiations of 5 per cent bonds can now be made on the basis
of the former negotiation."

XXXVII
GENERAL GRANT'S ADMINISTRATION

The greatness of General Grant in war, in civil affairs, and in
personal qualities which at once excite our admiration and deserve our
commendation, was not fully appreciated by the generation to which he
belonged, nor can it be appreciated by the generations that can know
of him only as his life and character may appear upon the written
record. He had weaknesses, and of some of them I may speak; but they
do not qualify in any essential manner his claim to greatness in the
particulars named. He was not fortunate in the circumstances incident
to the appointment of his Cabinet. The appointment of Mr. Washburne
as Secretary of State for the brief period of one or two weeks was not
a wise opening of the administration, if the arrangement was designed,
and was a misfortune, if the brief term was due to events not
anticipated. The selection of Mr. Fish compensated, and more than
compensated, for the errors which preceded his appointment. The
country can never expect an administration of the affairs of the
Department of State more worthy of approval and eulogy than the
administration of Mr. Fish. Apparently we were then on the verge of
war with Great Britain, and demands were made in very responsible
quarters which offered no alternative but war. The treaty of 1871,
which was the outcome of Mr. Fish's diplomacy, re-established our
relations of friendship with Great Britain, and the treaty was then
accepted as a step in the direction of general peace.

In the month of February, 1869, I received an invitation from General
Grant to call upon him on an evening named and at an hour specified.
At the interview General Grant asked me to take the office of Secretary
of the Interior. As reasons for declining the place, I said that my
duties and position in the House were agreeable to me and that my
services there might be as valuable to the Administration as my
services in the Cabinet. General Grant then said that he intended to
give a place to Massachusetts, and it might be the Secretary of the
Interior or the Attorney-Generalship. He then asked for my advice as
to persons, and said that if he named an Attorney-General from
Massachusetts, he had in mind Governor Clifford, whom he had met.
Governor Clifford was my personal friend, he had been the Attorney-
General of the State during my term as Governor, he was a gentleman of
great urbanity of manner, a well-equipped lawyer, and as an advocate he
had secured and maintained a good standing in the profession and through
many years. He had come into the Republican Party from the Webster
wing of the Whig Party. To me he was a conservative, and I was
apprehensive that his views upon questions arising, or that might
arise, from our plan of reconstruction might not be in harmony with the
policy of the party. Upon this ground, which I stated to General
Grant, I advised against his appointment. I named Judge Hoar for
Attorney-General and Governor Claflin for the Interior Department. I
wrote the full address of Judge Hoar upon a card, which I gave to
General Grant. Judge Hoar was nominated and confirmed.

At the same time, Alexander T. Stewart, of New York, was nominated
and confirmed as Secretary of the Treasury. It was soon discovered
that Mr. Stewart, being an importer, was ineligible for the office.
Mr. Conkling said there were nine statutes in his way. A more
effectual bar was in the reason on which the statutes rested, namely,
that no man should be put in a situation to be a judge in his own
cause. The President made a vain effort to secure legislation for the
removal of the bar. Next, Judge Hilton, then Mr. Stewart's attorney,
submitted a deed of trust by which Mr. Stewart relinquished his
interest in the business during his term of office. The President
submitted that paper to Chief Justice Cartter of the Supreme Court of
the District of Columbia. The Chief Justice gave a brief, adverse,
oral opinion, and in language not quotable upon a printed page.

We have no means of forming an opinion of Mr. Stewart's capacity for
administrative work, and I do not indulge in any conjectures. His
nomination was acceptable to the leading business interests of the
country, and in the city of New York it was supported generally. He
was a successful man of business and an accumulator of wealth, and at
that time General Grant placed a high estimate upon the presence of
talents by which men acquire wealth.

Following these events, there were early indications that Mr. Stewart's
interest in the President had been diminished, and gradually he took
on a dislike to me. When I knew of his nomination, or when I knew it
was to be made, I met him in Washington and assured him of my
disposition to give my support to his administration. On two occasions
when I was in New York I made calls of civility upon him, but, as he
made no recognition in return, my efforts in that direction came to an
end.

At a dinner given by merchants and bankers in the early part of
September, 1869, at which I was a guest, Mr. Stewart made a speech in
which he criticized my administration of the Treasury. In the canvass
of 1872 the rumor went abroad that Mr. Stewart had given $25,000 to
the Greeley campaign fund. In the month of October of that year, the
twenty-eighth day, perhaps, I spoke at the Cooper Union. Upon my
arrival in New York, I received a call from a friend who came with a
message from Mr. Stewart. Mr. Stewart would not be at the meeting,
although except for the false rumor in regard to his subscription to
the Greeley fund, he should have taken pleasure in being present. As
General Grant was to be elected, his attendance at the meeting might
be treated by the public as an attempt to curry favor with General
Grant and the incoming Administration.

As I was passing to the hall, a paper was placed into my hands by a
person who gave no other means of recognizing his presence. When I
reached the hall and opened the paper, I found that it was a summons
to appear as a defendant in an action brought by a man named Galvin,
who claimed damages in the sum of $3,000,000. At the close of the
meeting and when the fact became known one gentleman said to me: "I
do not see how you could have spoken after such a summons."

I said in reply: "If the suit had been for $3,000 only, it might have
given me some uneasiness, as a recovery would have involved payment.
A judgment of $3,000,000 implies impossibility of payment."

I had no knowledge of Galvin, but his letters of advice were found on
the files of the Treasury. Even after the suit, I did not examine them
for the purpose of forming an opinion of their value or want of value.
Galvin alleged in his declaration that he had furnished the financial
policy that I had adopted, that it had benefitted the country to the
amount of $300,000,000 and more, and that a claim of $3,000,000 was a
moderate claim. Under the statute, the Department of Justice assumed
the defence. The case lingered, Galvin died, and the case followed.

At the election of 1872, I voted at Groton in the morning, and in the
afternoon I went to New York, to find that General Grant had been
re-elected by a sufficient majority. On the morning of the next day, I
left the hotel with time for a call upon General Dix, who had been
elected Governor, and for a call upon Thurlow Weed. General Dix was
not at home. Notwithstanding the criticisms of Thurlow Weed as a
manager of political affairs in the State of New York and in the
country, I had reasons for regarding him with favor, although I had
never favored the aspirations of Mr. Seward, his chief. When I was
organizing the Internal Revenue Office in 1862-1863, Mr. Weed gave me
information in regard to candidates for office in the State of New
York, including their relations to the factions that existed--usually
Seward and anti-Seward--and with as much fairness as he could have
commanded if he had had no relation to either faction.

As I had time remaining at the end of my call upon Mr. Weed, and as I
had in mind Mr. Stewart's message at the Cooper Union meeting, I drove
to his down-town store, where I found him. He received me with
cordiality, but in respect to his health he seemed to be already a
doomed man. He was anxious chiefly to give me an opportunity to
comprehend the nature and magnitude of his business. As I was about
to leave, he took hold of my coat button and said: "When you see the
President, you give my love to him, and say to him that I am for him
and that I always have been for him." Still holding me by the button,
he said: "Who buys the carpets for the Treasury?"

I said: "Mr. Saville is the chief clerk, and he buys the carpets."

Mr. Stewart said: "Tell him to come to me; I will sell him carpets
as cheap as anybody."

When I repeated Mr. Stewart's message to the President he made no
reply, and he gave no indication that he was hearing what I was saying.

In regard to Judge Hoar's relations to President Grant, the public has
been invited to accept several errors, the appointment to the bench of
the Supreme Court of Justices Bradley and Strong, by whose votes the
first decision of the court in the Legal Tender cases was overruled,
and the circumstances which led to the retirement of Judge Hoar from
the Cabinet. First of all I may say that President Grant was attached
to Judge Hoar, and, as far as I know, his attachment never underwent
any abatement. Whatever bond there may be in the smoking habit, it
was formed without delay at the beginning of their acquaintance. While
General Grant was not a teller of stories, he enjoyed listening to good
ones, and of these Judge Hoar had a large stock always at command.
General Grant enjoyed the society of intellectual men, and Judge Hoar
was far up in that class. General Grant had regrets for the retirement
of Judge Hoar from his Cabinet, and for the circumstances which led to
his retirement. His appointment of Judge Hoar upon the Joint High
Commission and the nomination of Judge Hoar to a seat upon the bench of
the Supreme Court may be accepted as evidence of General Grant's
continuing friendship, and of his disposition to recognize it,
notwithstanding the break in official relations.

Judge Hoar's professional life had been passed in Massachusetts, and
he had no personal acquaintance with the lawyers of the circuit from
which Justices Strong and Bradley were appointed. Strong and Bradley
were at the head of the profession in the States of New Jersey and
Pennsylvania, and in truth there was no debate as to the fitness of
their appointment. Judge Hoar was not responsible for their
appointment, and I am of the opinion that the nomination would have
been made even against his advice, which assuredly was not so given.
Judge Strong, as Chief Justice of the Supreme Court of Pennsylvania,
had sustained the constitutionality of the Legal Tender Act, and it
was understood that Bradley was of the same opinion. As the President
and Cabinet were of a like opinion, it may be said that there could
have been no "packing" of the Supreme Court except by the exclusion
of the two most prominent lawyers in the circuit and the appointment
of men whose opinions upon a vital question were not in harmony with
the opinion of the person making the appointment.

As to myself, I had never accepted the original decision as sound law
under the Constitution, nor as a wise public policy, if there had
been no Constitution. By the decision the Government was shorn of a
part of its financial means of defence in an exigency. When the
Supreme Court had reached a conclusion, Chief Justice Chase called
upon me and informed me of that fact, about two weeks in advance of
the delivery of the opinion. He gave as a reason his apprehension of
serious financial difficulties due to a demand for gold by the
creditor class. Not sharing in that apprehension, I said: "The
business men are all debtors as well as creditors, and they cannot
engage in a struggle over gold payments, and the small class of
creditors who are not also debtors will not venture upon a policy in
which they must suffer ultimately." The decision did not cause a
ripple in the finances of the country.

Pursuing the conversation, I asked the Chief Justice where he found
authority in the Constitution for the issue of non-legal-tender
currency. He answered in the power to borrow money and in the power
given to Congress to provide for the "general welfare of the United
States." I then said, having in mind the opinion in the case of
MacCulloch and Maryland, in which the court held that where a power
was given to Congress, its exercise was a matter of discretion unless
a limitation could be found in the Constitution: "Where do you find
a limitation to the power to borrow money by any means that to Congress
may appear wise?" The Chief Justice was unable to specify a
limitation, and the question remains unanswered to this day.

When the case of Hepburn and Griswold was overruled in the Legal Tender
cases, the Chief Justice was very much disturbed, and with the
exhibition of considerable feeling, he said: "Why did you consent to
the appointment of judges to overrule me?" I assured him that there
was no personal feeling on the part of the President, and that as to
my own unimportant part in the business, he had known from the time of
our interview in regard to the former action of the court that I
entertained the opinion that the decision operated as a limitation of
the constitutional powers of Congress and that its full and final
recognition might prove injurious to the country whenever all its
resources should be required. At the time of the reversal, the Chief
Justice did not conceal his dissatisfaction with his life and labors
on the bench, and at the interview last mentioned he said that he
should be glad to exchange positions with me, if it were possible to
make the exchange.

Various reasons have been assigned for the step which was taken by
President Grant in asking Judge Hoar to retire from the Cabinet. Some
have assumed that the President was no longer willing to tolerate the
presence of two members from the same State. That consideration had
been passed upon by the President at the outset, and he had overruled
it or set it aside. In my interview with Mr. Washburne the Sunday
before my nomination, I had said to him that Judge Hoar and I were not
only from the same State, but that we were residents of the same
county, and within twenty miles of each other. Moreover, any public
dissatisfaction which had existed at the beginning had disappeared.
In the meantime the President had become attached to Judge Hoar. Nor
is there any justifying foundation for the conjecture that a vacancy
was created for the purpose of giving a place in the Cabinet to another
person, or to another section of the country. General Grant's
attachment to his friends was near to a weakness, and the suggestion
that he sacrificed Judge Hoar to the low purpose of giving a place to
some other person is far away from any true view of his character.

Judge Hoar had had no administrative experience on the political side
of the government, and he underestimated the claims, and he undervalued
the rights, of members of Congress. As individuals the members of
Congress are of the Government, and in a final test the two Houses may
become the Government. More than elsewhere the seat of power is in the
Senate, and the Senate and Senators are careful to exact a recognition
of their rights. They claim, what from the beginning they have
enjoyed, the right to be heard by the President and the heads of
departments in their respective States. They do not claim to speak
authoritatively, but as members of the Government having a right to
advise, and under a certain responsibility to the people for what may
be done.

It was claimed by Senators that the Attorney-General seemed not to
admit their right to speak in regard to appointments, and that
appointments were made of which they had no knowledge, and of which
neither they nor their constituents could approve. These differences
reached a crisis when Senators (I use the word in the plural) notified
the President that they should not visit the Department of Justice
while Judge Hoar was Attorney-General. Thus was a disagreeable
alternative presented to the President, and a first impression would
lead to the conclusion that he ought to have sustained the Attorney-
General. Assuming that the complaints were well founded, it followed
that the Attorney-General was denying to Senators the consideration
which the President himself was recognizing daily.

President Grant looked upon members of his Cabinet as his family for
the management of civil affairs, as he had looked upon his staff as
his military family for the conduct of the army, and he regarded a
recommendation for a Cabinet appointment as an interference. His
first Cabinet was organized upon that theory somewhat modified by a
reference to locality. Mr. Borie who became Secretary of the Navy
was a most excellent man, but he had had no preparation either by
training or experience for the duties of a department. Of this he
was quite conscious, and he never attempted to conceal the fact. He
often said:

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