e financial centres, recommended in a letter
to the Ways and Means Committee that the several States be asked
to pledge the United-States "deposit funds" in their hands for the
security of the loan. His immediate predecessor, Philip F. Thomas,
had, in his annual report in the preceding December, urged that
the "public lands be unconditionally pledged for the ultimate
redemption of all the Treasury notes which it may become necessary
to issue."

Such suggestions seem strange to the ears of those who were afterwards
accustomed to the unbounded credit of the Republic. But these
secretaries were called to hear from capitalists the declaration
that the national debt had increased from $28,460,958 on the 1st
of July, 1857, to $64,640,838 on the 1st of July, 1860, and that
the figures were still mounting upward. In the mean time the
revenues were falling off, the sales of public lands were checked,
and the estimates of customs for the current year were practically
overthrown by the secession of the Southern States and the denial
of the authority of the Union.

The task of Congress might well strike some thoughtful legislators
as that of making bricks without straw. As the Rebellion took form
and organization, it became clear that the ability and willingness
of the people to raise large sums of money were vital factors in
the problem of the maintenance of the Union. It was well that no
one knew just how great were the burdens which the loyal people
must bear. It is no disparagement to the leading statesmen of that
era, that they did not at first propose measures adequate to the
emergency, because no standards existed by which the magnitude of
that emergency could be estimated. If Congress had understood on
the 1st of July, 1861, that the ordinary expenditures of the
government would be, within the fiscal years 1863 and 1864, more
than the entire expenditures of the National Government from the
foundation of the nation to that day, paralysis would have fallen
upon the courage of the bravest. If the necessity had been proclaimed
of raising by loans before the 1st of July, 1865, two thousand
millions of dollars more than the National Treasury had ever received
from loans and revenue combined, the audacity of the demand would
have forbidden serious consideration. If the Ways and Means
Committee had been notified that before the end of 1865, the annual
charge for interest on the national debt, for which provision must
b