for a law directly taxing slaves and land had been ignored by Congress,
but another of his suggestions had been incorporated in the Funding Act.
The state of the currency was now so grave that Davis attributed to it
all the evils growing out of the attempts to enforce impressment. As the
value of the paper dollar had by this time shrunk to six cents in
specie and the volume of Confederate paper was upward of seven hundred
millions, Congress undertook to reduce the volume and raise the value
by compelling holders of notes to exchange them for bonds. By way of
driving the note-holders to consent to the exchange, provision was made
for the speedy taxation of notes for one-third their face value.

Such were the main items of the government program for 1864. Armed with
this, Davis braced himself for the great task of making head against the
enemies that now surrounded the Confederacy. It is an axiom of military
science that when one combatant possesses the interior line, the other
can offset this advantage only by exerting coincident pressure all
round, thus preventing him from shifting his forces from one front
to another. On this principle, the Northern strategists had at last
completed their gigantic plan for a general envelopment of the whole
Confederate defense both by land and sea. Grant opened operations by
crossing the Rapidan and telegraphing Sherman to advance into Georgia.

The stern events of the spring of 1864 form such a famous page in
military history that the sober civil story of those months appears by
comparison lame and impotent. Nevertheless, the Confederate Government
during those months was at least equal to its chief obligation: it
supplied and recruited the armies. With Grant checked at Cold Harbor, in
June, and Sherman still unable to pierce the western line, the hopes of
the Confederates were high.

In the North there was corresponding gloom. This was the moment when
all Northern opponents of the war drew together in their last attempt to
shatter the Lincoln Government and make peace with the Confederacy. The
value to the Southern cause of this Northern movement for peace at
any price was keenly appreciated at Richmond. Trusted agents of the
Confederacy were even then in Canada working deftly to influence
Northern sentiment. The negotiations with those Northern secret
societies which befriended the South belong properly in the story of
Northern politics and the presidential election of 1864. They