ity that existed during the war under such a
burden of taxation was frequently a matter of surprise. The truth
is that all productive industries were active because of the enormous
demand made by the army for supplies of all kinds, and everyone
who was willing to work could find plenty of employment. The
depreciation of the currency caused by the war did not embarrass
anyone, as the interest on securities was promptly paid in coin,
and greenbacks were the favorite currency of the people. The people
did not stop to inquire the causes of the nominal advance in prices;
they only knew that the United States note was cheerfully received
in every part of the United States as the current money of the
country. At the beginning the tax on whisky was 20 cents per
gallon, but it was gradually increased until it reached $2 a gallon,
when frauds and illicit distilling became serious evils. The tax
was then reduced to 90 cents a gallon.

When I became Secretary of the Treasury, I was impressed with the
magnitude of illicit distilling, even after the rate was reduced.
At that time several hundred men, mostly in the mountain regions
of North Carolina and Tennessee, were under arrest for violation
of the laws against illicit distilling. A delegation of them,
accompanied by Senator Ransom, appeared before me, and I heard
their apologies for distilling, and their complaints against the
officers. We entered into a formal engagement by which they agreed
to stop illicit distilling upon condition that they should be
relieved of punishment for their past acts, and, so far as I could
learn, they substantially observed their obligation. As a rule,
they were rough mountaineers who regarded whisky as a prime necessity
of life, and thought they ought to be allowed to convert their
grain into something better.

As the necessity for excessive taxation diminished after the war
was over, taxes on various articles were gradually repealed, until,
in 1894, they consisted of practically four items, spirits, tobacco,
fermented liquors, and oleomargarine. These are the figures for
two years:

Receipts during fiscal years
Objects of Taxation. ended June 30--
1893. 1894.
Spirits . . . . . . $94,720,260.55 $85,259,252.25
Tobacco . . . . . . 31,889,711.74 28,617,898.62
Fermented Liquors . 32,548,983.07 31,414,788.04
Oleomargarine . . . 1,670,643.50 1,723,4