ate had the largest pre-war
debt. Its $33,000,000 with accrued interest had amounted to about
$45,000,000 in 1870. In 1871 the question of settlement was taken up;
one-third of the debt was assigned to West Virginia, and the remainder
was funded into new bonds bearing interest at five and six per cent. The
coupons were made receivable for taxes and other debts due the State.
The amount recognized was beyond the ability of the State to pay, and
many members of both parties felt that some compromise must be made. So
many of the coupons were paid in for taxes that money to keep the
Government going was found with difficulty. Various attacks on the
privilege were made, but these "coupon killers" were usually declared
unconstitutional by the Supreme Court of the United States. Meanwhile
the contest had split the State. Some were in favor of paying the whole
debt according to the agreement of 1871; others wished to reduce the
interest rate; while the radicals wished to repudiate part of the debt
and reduce the rate of interest upon the remainder. The last named
faction, under the leadership of H.H. Riddleberger, organized a
political party known as the Readjusters and in 1879 captured the
Legislature. Riddleberger then introduced a bill which scaled down the
debt to less than $20,000,000, but it was vetoed by the Governor. Two years
later the new party captured both Governorship and Legislature and sent
General William Mahone to the United States Senate, where he usually voted
with the Republican party.

The Legislature repassed the Riddleberger bill, which the creditors
refused to accept, and an ingenious "coupon killer." Similar acts were
passed in 1886 and 1887. The United States Supreme Court, before which
these acts were brought, pronounced them unconstitutional in that they
impaired the obligation of contracts, but the Court also stated that
there was no way in which the State could be coerced. Meanwhile the
credit of the State was nonexistent, and all business suffered. In 1890
a commission reported in favor of compromising the debt on the lines of
the Riddleberger Act and, in 1892, $19,000,000 in new bonds were
exchanged for about $28,000,000 of the older issue. Interest was to be 2
per cent for ten years and then 3 per cent for ninety more.

West Virginia steadfastly refused to recognize the share of the debt
assigned to her on the ground that the principal part had been incurred
for internal improvements in Virgini