raph. He promised that as the law
makes no provision for any report from the department of state, a
brief history of the transactions of that important department
might furnish the occasion for future consideration.

I have a sincere respect for President Cleveland, but I thought
the message was so grave a departure from the customary annual
message of the President to Congress that it ought to be answered
seriatim. I did so in a carefully prepared speech. The answer
made can be condensed in a few propositions: An increase of revenue
(the law remaining unchanged) is an evidence of unusual trade and
prosperity. The surplus revenue, whatever it might be, could and
ought to be applied to the reduction of the public debt. The law
under which the debt was created provided for this, by requiring
a certain percentage of the debt to be paid annually, and appropriating
the surplus revenue for that purpose. Under this policy it was
estimated that the debt would be paid off prior to 1907.

But experience soon demonstrated that, whatever might be the law
in force, the revenues of the government would vary from year to
year, depending, not upon rates of taxation, but upon the financial
condition of the country. After the panic of 1873, the revenues
were so reduced that the sinking fund was practically suspended by
the fact that there was no surplus money in the treasury to meet
its requirements. At periods of prosperity the revenues were in
excess of the current expenses and the sinking fund, and in such
conditions the entire surplus revenue, was applied to the reduction
of the public debt and thus made good the deficiency in the sinking
fund in times of financial stringency. This was a wise public
policy, fully understood and acted upon by every Secretary of the
Treasury since the close of the war and prior to Mr. Manning.

Another rule of action, founded upon the clearest public policy,
had been observed prior to the incumbency of Mr. Cleveland, and
that was not to hold in the treasury any form of money in excess
of a reasonable balance, in addition to the fund held to secure
the redemption of United States notes. All sums in excess of these
were promptly applied to the payment of the public debt, and, if
none of it was redeemable, securities of the United States were
purchased in the open market. It was the desire of Congress and
every Republican Secretary of the Treasury, in order to comply with
the sinking fund