the first section fixed the maximum limit of United-States notes at
$382,000,000. The limit was raised to $400,000,000 on motion of Mr.
Wright of Iowa, and the Senate refused to allow any clause for future
reduction. This was $44,000,000 beyond the amount of legal-tender
notes then in circulation. An enlargement of the circulation of the
National banks was made at the same time, by which in connection with
the greenbacks there might be an addition of $100,000,000 to the paper
currency of the country. The two Houses differed as to details, but
soon agreed upon a bill containing the general provisions proposed in
the Senate.

This action of Congress followed an earnest popular demand, resulting
from the distrust which had become so general in consequence of the
panic. A large proportion of the business men, especially in the West
and South-West, believed that an increased circulation of notes would
bring great relief. At the beginning of the session of Congress,
President Grant had clearly intimated that he had come to the same
conclusion. He said in his annual message: "In view of the great
actual contraction that has taken place in the currency, and the
comparative contraction continuously going on, due to the increase of
manufactures and all the industries, _I do not believe there is too
much of it now for the dullest period of the year_. Indeed, if
clearing-houses should be established, thus forcing redemption, it is
a question for your consideration whether banking should not be made
free, retaining all the safeguards now required to secure bill-holders."
But nearly five months had elapsed since the President had expressed
these views, and during that time he had come to more conservative
conclusions, and he now vetoed the bill, which did not seem so
radical in its provisions as his own recommendation had been.
To make National banking free before compelling the banks to redeem
their notes in coin, would have proved a measureless inflation, and the
President wisely receded from the position assumed in his annual
message.

An important Act, changing the Customs laws, was reported from the
Committee on Ways and Means by Mr. Ellis H. Roberts, who had made the
investigation which led to it with great care and sagacity. It
received the assent of both branches, though some amendments were added
to it in the Senate. It was radical in its nature. It changed methods
which had prevailed from the foundation of the