The agitation for the resumption of specie payment brought forward the contest between contract ionists and inflationists. The latter failed in their efforts to balk the resumption hut the general feeling on which their rested. that a ln.althy curreney must expand with the needs of the country, had to be reckoned with. This led in 1876 to the appoint ment, of the 1\lonetary Commission (q.v.), whose report presented in 1877 favored the free coinage of silver and thus began the long battle for that ideal. fIermany had adopted the gold standard and was selling silver, the mines of the United States continued to increase their output, and silver was falling in the market below the legal ratios established by long usage in bimetallic countries. A bill for the free coinage of silver passed the House of Representatives in 1878. The Senate, however, was unwilling to accept for the United States alone the whole burden of the rehabilitation of silver, and a compromise resulted in the Bland-Allison Act. which was passed over the President's veto, February 28, 1878. It provided that not less than $2.000,000 worth of silver nor more than $4,000,000 worth should be purchased monthly and coined into standard silver del hers (412V, grains of silver 900 fine), which should be a full legal tender for all debts, public and private, without exception. It also authorized the President to call an inter national conference for the of interna tional bimetallism at a common ratio to be agreed upon. It also permitted the issue of silver cer tificates in sums of $10 and upward for standard silver dollars deposited in the Treasury. No re lief came from the international conference, and the coinage went on inereasing in volume as the price of silver fell. Soon embarrassment was caused by the tendency of these dollars to return to the Treasury, as has than $60,000,000 were absorbed by the circulation. There was no dif ficulty, however, after a law of 1886 permitted the issue of certificates in denominations of $1, $2, and $5. 'While the number of dollars in cir
culation is not large, there is no obstacle to the circulation of silver certificates.
Under the law• of 1878, which continued in force until 1890, $378.1100,000 were coined. The price of silver continued to fall and with it the price of other commodities. International bimetallism as a remedy for failing prices continued to gain favor among economists, and the• agitation for free silver coinage in the United States grew in strength. In 1890 again the house of Represen tatives passed a free coinage bill, but a compro mise worked out in the Senate was finally ac cepted and became law. This provided for the purchase of 4,500,000 ounces of silver monthly and thq issue of Treasury notes for the cost price thereof. These notes were a legal tender, and the privilege was given to the Treasury Department to coin the silver thus purchased and replace the notes with silver certificates. The embarrass ments of the Treasury and the difficulty of keep ing the growing mass of silver money at a parity with gold led in 1893 to the repeal of the com pulsory silver purchase provision. limier this law 168,000,000 ounces of silver had been pur chased and Treasury notes to the amount of 8155. 000,000 issued. The repeal of the act in 1893 took place only after a severe struggle, and the friends of silver did not give up the light. The Presidential contest of 1596 was fought out on the free coinage question and resulted in the signal defeat of the Silver Party. In 1900 a new was passed which squarely defined the gold dollar as the standard of value in the United States. It provided, as already stated, a larger reserve for the redemption of the legal tender notes. The attempt to make silver dol lars redeemable in gold was, however, unsuccess ful. The saute measure favored the expansion of the national bank note issues by permitting note issues to the amount of the. par value of the bonds deposited and by reducing the tax upon the circulation of banks.
See articles BANK. BANNINO;