as fast as
possible; and by 1873 the debt was reduced by more than $500,000,000.

As to the second question, it was decided to "contract the currency" by
gathering into the Treasury and there canceling the "greenbacks." This
was begun, and their amount was reduced from $449,000,000 in 1864 to
$356,000,000 in 1868.

By that time a large part of the people in the West were finding fault
with "contraction." Calling in the greenbacks, they held, was making
money scarce and lowering prices. Congress, therefore, in 1868 yielded
to the pressure, and ordered that further contraction should stop and
that there should not be less than $356,000,000 of greenbacks.

%497. "The Ohio Idea"; the Greenback Party.%--But there was still
another idea current. To understand this, six facts must be remembered.
1. In 1862 Congress ordered the issue of certain 5-20 bonds; that is,
bonds that might be paid after five years, but must be paid in twenty
years. 2. The interest on these bonds was made payable "in coin." 3. But
nothing was said in the bond as to the kind of money in which the
principal should be paid. 4. When the greenbacks were issued, the law
said they should be "lawful money and a legal tender for all debts,
public and private, within the United States, except duties on imports
and interest as aforesaid." 5. This made it possible to pay the
principal of the 5-20 bonds in greenbacks instead of coin. 6. Fearing
that payment of the principal in greenbacks might have a bad effect on
future loans, Congress, when it passed the next act (March 3, 1863) for
borrowing money, provided that _both_ principal and interest should be
paid in coin.

At that time and long after the war "coin" commanded a premium; that is,
it took more than 100 cents in paper money to buy 100 cents in gold.
Anybody who owned a bond could therefore sell the coin he received as
interest for paper and so increase the rate of interest measured in
paper money. The bonds, again, could not be taxed by any state or
municipality.

Because of these facts, there arose a demand after the war for two
things--taxation of the bonds and payment of the 5-20's in greenbacks.
This idea was so prevalent in Ohio in 1868 that it was called the "Ohio
idea," and its supporters were called "Greenbackers."

%498. Opposition to Land Grants to Railroads.%--Much fault was now
found with Congress for giving away such great tracts of the public
domain. In 1862 a law known as the Homestead