r as money. He regarded the legal tender acts as war
measures, and, while he did not recommend their repeal, he expressed
his opinion that they ought not to remain in force one day longer
than would be necessary to enable the people to prepare for a return
to the constitutional currency. He denied the authority of Congress
to issue these notes except in the nature of a loan, and affirmed
that the statute making them a legal tender for all debts, public
and private, was not within the scope of the duties or the
constitutional powers of Congress; that their issue as lawful money
was a measure necessary in a great emergency, but, as this emergency
did not then exist, the government should, as speedily as possible,
withdraw them, and he recommended that the work of retiring the
notes should be commenced without delay and carefully and persistently
continued until all were retired. He proposed to do this by the
sale of bonds for United States notes outstanding and their withdrawal
and cancellation. He recommended as a substitute the notes of
national banks, but even these notes he thought redundant, and said:

"There is no fact more manifest that the plethora of paper money
is not only undermining the morals of the people by encouraging
waste and extravagance, but is striking at the root of our material
prosperity by diminishing labor . . . and if not speedily checked,
will, at no distant day, culminate in widespread disaster. The
remedy, and the only remedy within the control of Congress, is, in
the opinion of the secretary, to be found in the reduction of the
currency."

The chief part of his report was devoted to the danger of inflation
and the necessity of contraction. He said the longer contraction
was delayed the greater must the fall eventually be, and the more
serious its consequences.

In accordance with the recommendations of Secretary McCulloch, a
bill was introduced in the House by Justin S. Morrill, which
authorized the Secretary of the Treasury, at his discretion, to
sell any of the description of bonds authorized by the act of March
3, 1865, the proceeds to be used only to retire treasury notes or
other obligations issued under any act of Congress. This bill as
reported would have placed in the power of the secretary the
retirement of all United States notes at his discretion. An
amendment was made in the House which provided:

"That of United States notes not more than ten millions of dollars
ma