Financial History of The United States BY DAVIS RICH DEWEY, PH. D., PROFESSOR OF ECONOMICS AND STATISTICS, MASSACHUSETTS INSTITUTE OF TECHNOLOGY. SECOND EDITION LONGMANS, GREEN, AND CO., 91 AND 93 FIFTH AVENUE, NEW YORK LONDON AND BOMBAY 1903 Copyright, 1902. BY LONGMANS, GREEN, AND Co. All rights reserved. First edition, February, 1903. Second edition, revised, November, 1903. JOHN WILSON AND K, f AMB flfirn T r - TO THE SEMINARY OF THE DEPARTMENT OF HISTORY, POLITICS, AND ECONOMICS OF JOHNS HOPKINS UNIVERSITY, Of which the author was a member from 1883 to 1886. Under the gtiidance of Adams, Ely, and Jameson, we read and learned. The first has gone, leaving affectionate memories and organized activities of permanent usefulness the others are still doing their work in a spirit of broad-minded sympathy and fine scholarship. Preface. THE attempt to compress into a volume of moderate size an account of Federal finance from the Colonial period down to the present time occasions perplexity. Some knowledge of politics and economics must be pre-supposed, but the exact measure it is difficult to estimate. In order to place readers as far as possible on a common basis, the reference lists which are scat tered through the volume have been constructed on a generous plan. In no way, however, are these lists to be regarded as conditional to an understanding of the text they are simply opportunities for a better prepar ation, or a further study of special topics. In writing this work, I have kept two things constantly in mind first, its proportions, or the general perspec tive and second, the relations of financial legislation to democracy. It is easy in the light of accumulated ex perience to passjudgment on the errors of the past, but historical study, in my opinion, is more fruitful if the reader endeavors to interpret the past in accordance with the experience which was available at the time the occurrences took place. Past environment is the true test of past action. With this conviction, I have endeavored to refrain, possibly not with entire consist ency, from emphasizing the mistakes of previous gen erations. A work on American Finance might well viii Preface. have a didactic purpose, but this is a history and not a treatise. In determining the proportions of this volume, I have been obliged to pass by many incidents of keen interest the omissions arc necessarily far greater than the inclu sions. The result is doubtless a loss of interest, but it is hoped that the gain from an orderly presentation of the essential facts may be a substantial compensation. It is impossible to include by name all of those who have given friendly counsel, but I wish to thank in particular the editor of this series, Professor Hart, and Professor Henry B. Gardner, of Brown University. The former undertook a very considerate reading of the manuscript, and without the support of his knowledge of American history my task would have been much more difficult. To Professor Gardner I am under great in debtedness his learning and sound judgment have constantly stood me in good stead, and strengthened a friendship of long standing. I also wish to make acknowledgment to Professor Bullock, who has done pioneer work for several periods of American finance his investigations justify the hope that he will find opportunity to write a larger work on the finances of our country. I am in a special way indebted tomy colleague, Professor Currier, to Mr. S. N. D. North, and to various officials of the Treasury Department. MASSACHUSETTS INSTITUTE OF TECHNOLOGY, BOSTON, January, 1903. SUGGESTIONS FOR STUDENTS, TEACHERS, AND READERS. I. Introductory Heading Political History and Biography...