ivilege, conferred originally upon United States notes, had
been renewed in 1866, with the right of reissue, bonds and notes
would together have advanced to par in coin. But this is what the
contractionists especially opposed. They demanded the cancellation
of the notes when presented, a contraction of the currency when
offering our bonds. It is easy now to perceive that a conservative
use of United States notes, convertible into four per cent. bonds,
would have steadily advanced both notes and bonds to par in coin.
But the equally erroneous opposing opinions of contractionists and
expansionists delayed for many years the coming of coin resumption
upon a fixed quantity of United States notes.

Among the acts of this Congress of chief importance is the act
approved July 13, 1866, to reduce taxes and provide internal revenue.
The passage of such an act required much labor in both Houses, but
especially so in the House of Representatives, where tax bills must
originate. It was a compromise measure, and, unlike previous acts,
did not reach out for new objects of taxation, but selected such
articles as could bear it best, and on some of these the tax was
increased. A great number of articles that enter into the common
consumption of the people and are classed as necessities of life
were relieved from taxation. The general purpose of the bill was
in time to concentrate internal taxes on such articles as spirits,
tobacco and beer. The tax on incomes was continued but limited to
the 30th of June, 1870. I have already stated the marked development
of internal taxation, and this measure was one of the most important
in the series to produce great revenue at the least cost, and of
the lightest burden to the taxpayer.

Soon after the passage of the act, approved April 12, 1866, to
contract the currency, I introduced a bill, "To reduce the rate of
interest on the national debt and for funding the same." In view
of the passage of that act I did not expect that a funding bill
would meet with success, but considered it my duty to present one,
and on the 22nd of May, 1866, made a speech in support of it. The
bill provided for the voluntary exchange of any of the outstanding
obligations of the United States for a bond running thirty years,
but redeemable at the pleasure of the United States after ten years
from date, bearing interest at the rate of five per cent., payable
annually. On reading that speech now I find that, tho