for the issue of $400,000,000 of bonds, bearing 3 per cent. interest, and payable in twenty years, or redeemable in five years after the date of issue, and also treasury notes to an amount not exceeding $300,000,000, bearing interest at 3 per cent., redeemable at the pleasure of government after one year, and payable in ten years from the date of issue. But while passing through congress, a provision was introduced into the measure, which was not only decidedly objectionable in itself, but was opposed to the spirit of a funding act, which should be a purely voluntary transaction: the government ought not, in such a case, to attempt to force a sale, either upon the people or upon any particular class of institutions. The securities of the government had been made a basis for the circulation of the national banks, and these useful institutions had experienced a great reduction in their profits, through the previous funding operations of the government. The comptroller of the currency, in his report for 1879, said: "The refunding of the national debt commenced in 1871, at which time the national banks held nearly $400,000,000 of the 5 and 6 per cent. bonds; and from that date to the present time they have held more than one-fifth of the interest-bearing debt of the United States. This class of bonds has since been greatly reduced, and is now less than onesixth of all the bonds pledged for circulation, while more than one-third of the amount consists of bonds bearing interest at 4 per cent." At the time that this funding bill was pending (1881) the amounts of 6 and 5 per cents had been still more reduced. It was now proposed to make the new bonds the only government securities that could in future be used by the banks as a basis for their circulation, and, as an inducement to the banks to accept this proposition, the taxes on capital, deposits and circulation were to be repealed. But these measures of compensation were not included in the bill which passed the house, and the finance committee of the senate proposed to strike out this coercive section, thus removing the objectionable feature of the bill. It had been shown by the comptroller of the currency that such a section would strike a very serious blow at the national bank system, as the $211,000,000 of bonds then deposited by the banks would mature in that year (1881), and this amount of the new 3 per cents would have to be substituted, or the notes issued on it would have to be retired, and the banks probably be compelled to go into liquidation. But the section was restored, and the bill went to the president. The result of this provision was to create great distrust among the banks, and in the short period of thirteen days they contracted their issues by $18,722,340, and nearly precipitated a panic. In fact, a crisis was averted only by the action of the secretary of the treasury, who paid out an equal amount of legal tenders in the purchase of bonds. This movement was, however, caused in a measure by other provisions of the bill, which were, that "section four, of the act of June 20, 1874, entitled 'an act fixing the amount of United * * States notes,' be and the same is hereby repealed; and sections 5159 and 5160 of the Revised Statutes of the United States be, and the same are hereby, re-enacted." This would deprive the banks of the right to take up by a deposit of legal tenders their bonds held by the treasurer as a security for their circulation, and would compel them to keep bonds to the amount of one-third of their capital, and this, whether they issued circulating notes or not. This panic, however uncalled for, showed that the banks believed their existence to be endangered, and the president, taking the same position, vetoed the bill, giving as a reason the inexpediency, not to say the injustice, of the coercive section. "Under this section it is obvious that no additional banks will hereafter be organized, ** and no increase of the capital of existing banks can be obtained except by the purchase and deposit of 3 per cent. bonds. No other bonds of the United States can be used for the purpose. This is a radical change in the banking law. It takes from the banks the right they have heretofore had under the law to purchase and deposit, as security for their circulation, any of the bonds issued by the United States, and deprives the bill holder of the best security which the banks are able to give, by requiring them to deposit bonds having the least value of any bonds issued by the government. In short, I can not but regard the fifth section of the bill as a step in the direction of the destruction of the national banking system." The veto message was submitted on the day before congress adjourned, so that no action could be taken on it. In this way was a refunding measure defeated. But the debt was maturing, and some provision for meeting it must be made. Congress had adjourned, and the responsibility was thrown upon the secretary of the treasury. On March 1, 1881, or three days before the adjournment of congress, the maturing debt was: TITLE OF LOAN. * * The only resources of the government to meet these obligations were the surplus revenue, and about $104,650,000 of 4 per cent. bonds that had been authorized by the acts of 1870 and 1871, but had not been disposed of. To pay off the maturing bonds with the revenue was clearly out of the question; and to have issued the 4 per cents would have placed so much of the debt beyond the control of the government, owing to the length of time they had to run before redemption, a step that it was not expedient to take. The secretary, Mr. Windom, therefore assumed the responsibility and adopted the following plan: "On April 11 there was called for absolute payment on July 1, 1881, the small loan of $688,200, bearing 6 per cent. interest, and known as the Oregon war debt, www. nuc. and at the same time, for payment on the same date, the 6 per cent. loans, acts of July 17 and Aug. 5, 1861, amounting to $140,544,650, and act of March 3, 1863, amounting to $55,145,750; but to the holders of the bonds of the two latter loans permission was given to have their bonds continued at the pleasure of the government, provided they should so request." This plan proved entirely successful, and a like privilege was extended to the holders of the funded loan of 1881. The bonds were presented freely, because the new continued bonds (known as Windoms") bore a small premium, and the amounts that were not so presented were easily met by the surplus reveThe annual saving in interest accomplished by this simple operation was $10,473,952, and on Nov. 1 there remained outstanding of bonds bearing 3 per cent. interest, payable at the pleasure of the government, $563,380,950. The step taken by the secretary was severely criticised as being an assumption of legislative powers by an executive officer, but he really had no alternative, and, as events proved, his expedient was better than the one proposed by congress, which would have placed it beyond the power of the government to pay a larger portion of the debt by postponing payment of it for a term of years. Although this was not, properly speaking, a refunding measure, it accomplished what such a measure proposed to accomplish, and so satisfactory was the result that Secretary Folger made "no recommendation of legislation for the refunding of the bonds now outstanding bearing | Dollars. 43.476,300.00 39,022,200.00 interest at 3 per centum."-A bill to refund $200,000,000 of the continued bonds into 3 per cent. stock was debated in the senate, but failed in the house, and the whole matter would have been allowed to rest had it not been for the necessity of allowing the national banks to renew their charters. The eleventh section of this act (July 12, 1882) authorized the secretary to receive continued bonds, and to issue instead 3 per cent. securities; and provided "that the bonds herein authorized shall not be called in and paid so long as any bonds of the United States heretofore issued bearing a higher rate of interest than 3 per centum, and which shall be redeemable at the pleasure of the United States, shall be outstanding and uncalled. The last of the said bonds originally issued under this act, and their substitutes, shall be first called in, and this order of payment shall be followed, until all shall have been paid.' This measure completed the funding operations of the government, and while more than $300,000,000 of the 3 per cents were exchanged for 3 per cents, the surplus revenues were so great that, by November, 1883, the 3 per cents were being called in for payment. It was, in fact, then a question as to what should be done with the revenues of the government when all the threes were redeemed, as no other bonds became due until 1891, and the attempts to reduce the revenue had proved abortive. For the purpose of showing more completely the changes that have occurred in the debt, the following table, from official records, is given : " Dollars. 3,443,687.29 Dollars. 64,640,838.11 90,380,873.95 5,092,630.43 30,483,000.00 154,313,225.01 122,582,485.34 365,304,826.92 22,048,509.59 30,483,000.00 431,444,813.83 139,974,435.34 707,531,634.47 41,854,148.01 300,213,480.00 842,882,652.09 139,286,935.34 1,359,930,763.50 78,853,487.24 245,709,420.63 1,213,495,169.90 671,610,397.022,221.311,918.29 187,742,617.43 269,175,727.65 1,281,736,439.33 830,000,000.00 2,381,530,294.96 150,977,697.87 201,982,665.01 1,195,546,041.02 813,460,621.95 2,332,331,207.60 146,068,196.29 198,533,435.01 1,543,452,080.02 488,344,846,95 2,248,067,387.66 138,892,451,39 221,586,185.01 1,878,303,984.50 37,397,196.95 2,202,088,727.69 128,459,598 14 221,588,300.00 1.874,347,222.39 221,588,300.00 1,765,317,422 39 2,162,060,522.39 125,523,998.84 2,046,455,722.39 118,784,960.34 274,236,450.00 1,613,897,300.00 1,934,696,750.00 111,949,3390.50 414,567,300.00 1,374,883,800.00 1,814,794,100.00 103,988,463.00 414,567,300.00 1,281,238,650.00 1,710,483,950.00 98,049,804.00 510,628,050.00 1,213,624,700.00 1,738,930,750.00 98.796,004.50 607,132,750.00 1,100,865,550.00 1,722,676,300.00 96,855,690.50 1,710,685,450.00 95,104,269.00 1,711,888,500.00 93,160,643.50 738,619,000.00 1,794,735,650.00 94,654,472.50 1,797,643,700.00 83,773,778.50 1,723,993,100.00 79,633,981.00 1,639,567,750.00 75,018,695.50 1,463,810,400.00 57,360,110.75 140.000,000 703,266,650.00 854,621,850.00 14,000,000 739,349,350.00 250,000,000 -AUTHORITIES. The Finance Reports and Con- | into two chambers, the members of the lower gressional Globe and Record are the chief authori- house being elective. (See AUSTRIA-HUNGARY.) ties, but there is much material scattered among periodicals which might be consulted with advantage, but which can not be mentioned in this place. WORTHINGTON C. FORD. REICHSRATH (council of the empire) is the name of the parliament of Austria. It is divided REICHSTAG. The Reichstag is the elective chamber of the German parliament. Thus was resumed the name of the assembly of the estates of the German empire, which, from 1663, up to 1806, convened regularly at Regensburg, under the presidency of the emperor, or of the arch chancellor of the empire, the elector-archbishop of Mayence. That assembly was divided into three chambers: 1, of electors; 2, of princes, divided into the temporal and the ecclesiastical bench (the neutral bench between them was occupied by the Protestant bishops of Lübeck and of Osnabrück); 3, of cities, subdivided into the bench of the Rhine and the Suabian bench. Each of the three chambers deliberated separately; after a separate vote had been taken, the chambers sought to come to an understanding, for the purpose of presenting to the emperor a common decision, called conclusum imperii. BLOCK. REMOVAL OF DEPOSITS. (See DEPOSITS, REMOVAL OF.) | formally conferred, and the only provisions expressly affecting that power are these: 1. "The president, vice-president, and all civil officers of the United States, shall be removed from office on impeachment for a conviction of treason, bribery, or other high crimes and misdemeanors." 2. "The judges, both of the supreme and inferior courts, shall hold their offices during good behavior," and their compensation shall not be diminished during continuance in office. 3. "The house of representatives shall elect their speaker and other officers; **the senate shall choose their other officers, and also a president pro tempore in the absence of the vice-president." Each of these provisions plainly leaves the important authority and duty of removal of federal officials, in case they are not guilty of high crimes or misdemeanors, utterly unprovided for, and therefore to mere implication. The appointment has been held complete when the commission is filled out and signed by the president, even though not delivered. (Marbury vs. Madison, 1 Cranch, 137, and 19 Howard Rep., 4, 74.) But President Jefferson dissented from this view, and treated a delivery of the commission as essential to complete an appointment.— Congress has vested in the courts of law the ap of those tribunals. With considerable exceptions (for which see CONFIRMATION and TERM AND TENURE OF OFFICE), it has vested in each of the REMOVALS FROM OFFICE. The subject of Appointments has been reserved, to be considered here with Removals. An appointment, in a political sense, is the designation and authorization, by the proper authority, of some person to be a public officer or agent, with the powers and duties conferred by law. A removal is an act, on the part of some competent authority, by which the holding of a public office or agency is brought to an end. Very generally the power of appoint-pointment of nearly or quite all the subordinates ment and that of removal are vested in the same officer or body. Under enlightened governments this power, save in so far as it relates to the subordinates of the judicial and legislative depart-heads of departments the appointment of its own ments, is, with few exceptions, treated as an executive power. Under the very defective confederacy which preceded the American constitution, the appointing power was in congress, there having been no executive branch; and in several of the states a greater or less portion of that power has been retained or usurped by the legislature. Sometimes, however, the power of appointment is divided between two authorities, as in the case of about 3,500 of the higher non-elective officers of the United States, who are nominated by the president and confirmed by the senate. (See CONFIRMATION.) The same mode of appointment generally prevails in the states; but Massachusetts gives the power of confirmation, generally, to a council of eight members elected by the people in districts, and perhaps some other states have followed her example. The federal constitution, the theory of which is followed by the states, confers the appointing power upon the president in these words: "He shall nominate, and by and with the advice and consent of the senate, shall appoint, ambassadors, other public ministers and consuls, judges of the supreme court, and all other officers of the United States, whose appointments are not herein otherwise provided for, and which shall be established by law; but the congress may by law vest the appointment of such inferior officers as they may think proper in the president alone, in the courts of law, or in the heads of departments." This power extends to army and navy appointments, as well as to those for the civil service. No power of removal is subordinates. And legislative bodies in the United States, as in all other really free countries, appoint and remove their own subordinates. — Under the federal constitution, it would seem plain, that, with the exception of officers of congress, no appointment of civil officers can be made, except, first, by the president, by and with the advice and consent of the senate; or, second, of inferior officers, 1, by the president alone, 2, by one of the heads of a department, or, 3, by a court of law.— There seems to be no clear definition of an "inferior officer" in the sense of the constitution, and it would be very difficult to frame one of much definiteness. What, then, is the extent of the power of congress to vest appointments? It is by no means easy to determine what persons in the public service are, in any sense, officers within the purview of the constitution. There are at all times thousands in that service whom the law, with little precision, designates as employés. In legal phrase, they are employed, but not appointed, and are dismissed, or discharged, but not removed. Their selection for, and severance from, the public service, is, therefore, technically no exercise of the appointing power. Mere laborers in the navy yards, arsenals, and elsewhere, are clearly only employés. But many persons, in continuous service at custom houses and other offices, as well as the clerks of committees and commissions, and all like officials, whose relations and duties are nearly identical with those of others classed as officers, are designated and treated as if only employés. Such, too, is the case of nearly all of the tens of thousands of the subordinates of postmasters throughout the Union, they being employed and discharged by the postmasters themselves, without any action by the postmaster general; yet the subordinates of collectors, naval officers, surveyors, etc., with slight exceptionthough having analogous functions and authority, and being in no respect more official and permanent are treated as officers. They are appointed and removed by the secretary of the treasury; the direct superiors of the latter "inferior officers" only making recommendations concerning them to that "head of department." On no sound principle can such discrimination be made. The clerk of the postmaster, on the basis of principle, dignity and justice, is as much an officer as the clerk of the collector. The question may well arise as to which of these two classes of public servants are now being selected and discharged in an unconstitutional manner. - Confusion on the subject has existed from the beginning of the government. A law of 1789 (1 Stat. at Large, chap. XX., § 27), authorizes "marshals to appoint one or more deputies," and a court or judge to remove them. It has been decided (United States vs. Finkle, 3 Blatchford Rep., 425), that "these deputies are officers." But if they are officers, it is plain that they can not be appointed by a marshal, he not being an official upon whom congress can confer the appointing power. (See United States vs. Hertwell, 6 Wallace Rep., 385, for an analogous case.)- The authority of congress, in regard to vesting the appointing power, may obviously be so exercised as to greatly affect not only the executive department itself, but the relations between it and the senate. The appointment of the vast number of subordinates now made by the heads of the departments alone might either be vested in the president alone, or, on the other extreme, be made subject to the confirmation of the senate. So the appointment of all who can be classed as "inferior officers" of the about 3,500 officers now nominated by the president and confirmed by the senate, might be given to the president alone or to heads of depart ments. And it is by no means clear how far congress may go in regulating the power of removal. Even as early as 1826, a committee of the senate made a report in favor of requiring the president, in making nominations to that body, to fill a vacancy caused by a removal, to state the reasons for which the removal had been made. There is a statute forbidding the head of a department removing certain officers "except for cause stated in writing, which shall be submitted to congress at the session following such removal." (U. S. Rev. Stat., sec. 1705; and see CONFIRMATION, for effect of tenure of office acts.) The question where the right of removal was vested arose almost upon the government going into effect. Closely connected with that, was the question as to the theory and basis of removals. These questions were discussed in the house of representatives at its first session, of which Madison was a | member. A considerable majority-contrary to a view expressed in the "Federalist," and approved by Mr. Webster-finally held that the power of removal was in the president alone, and that he could remove in his discretion. (Annals of Congress, vol. i., pp. 369-384.) The senate approved this view, but only by the casting vote of the vice-president, Mr. Adams. (Ex parte Hennin, 13 Peters Rep., 237, 240.) In conformity to this view, the act establishing the treasury department declares that "the secretary may be removed by the president." Ever since, this vast implied power-the greatest perhaps ever conferred by mere construction-has been accorded to the president, without its ever having been made an issue in the courts. (1 Kent's Commentaries, 311.) The debate in the house was elaborate, and disclosed great diversity of opinion. The rule for which Mr. Madison, who took a leading part, contended, was that the power of removal was an incident to or really a part of the power of appointments, and that it therefore belonged. to the president alone. The senate was to have no part in its exercise. He also maintained, with unanswerable cogency, that removals can be made only for cause, and that a failure to remove for good cause and a removal without such cause, would alike be malfeasance on the part of the president, (and consequently on the part of any official having the appointing power), which would justly subject him to impeachment. It was strongly urged by others, that, as the senate had the power of confirmation (see CONFIRMATION), and hence in a sense shared the appointing power, it should also be consulted as to removals. Mr. Benson, of New York, (where the spoils system was first and most fully developed), advanced the doctrine that the president could remove at pleasure"; and consequently that he was under no such legal or moral responsibility as Mr. Madison insisted upon. Others urged the equally rad-ical view, on the other extreme, that appointed. officers were removable only by impeachment and conviction, which would, of course, give a tenureof good behavior. The only decision reached. was, that the power of removal was in the president alone, until some part of it should (with the power of appointment) be vested by congress elsewhere, as the constitution authorizes. Yet, with strange inconsistency, the first congress, in one case, by law vested the power of appointing certain officers in one subordinate official (not the head of a department), and the power of removing them in another. (1 Stat. at Large, chap. xx., 27.)- Despite the conflicting action of congress, the rule of the courts is, that the power of removal is an incident of the power of appointment. (Ex parte Hennin, 13 Peters Rep., 261.) It is the general rule, consequently, that when a power of appointment is conferred, the power of removal accompanies it as an incident; the conditions on which the removal may be made depending on the tenure of the office, as defined by law. (See TERM AND TENURE OF OFFICE.) Where there is a tenure of good behavior, it is plain there | There can be little doubt that there has been a must be a good cause arising from the bad con- mischievous and unwarranted suggestion drawn duct of the official. Removal, in such a case, from the phrase "removable at pleasure," somemust be preceded by such action as is equivalent times used by the courts. It has too often, even to a conviction for misbehavior; of which there by honest citizens, been accepted as meaning an must have been a charge, and upon that charge a authority under no moral obligations; when, in trial and opportunity of defense. (Page vs. Hoe- fact, nothing can be clearer than the duty of din, 8 B. Munroe, 672.) There are few cases of using it, conscientiously, for the promotion of such tenure, except the judiciary. Under a pow- the public interests in the broadest sense in which er to remove "for cause there is a limitation of they may be affected. Whatever may be said of the power of a mere discretionary removal, and a technical, legal power, no officer can have a there must be a legal cause-malfeasance, mis- right to remove a worthy public servant, except feasance or nonfeasance-constituting a breach for adequate public reasons, nor any right to forof the trust of the office, of which the courts can bear to remove an unworthy one, unless the retake notice; and they will restore the officer re- moval would, for peculiar reasons, be at the mo moved without such cause. (State, etc., vs. Com- ment a public detriment. This was the rule laid mon Council, 9 Wisconsin Rep., 254; Ex parte down by Madison, and enforced during his genKing, 35 Texas Rep., 657; Field vs. Com., etc., eration. The moral obligations attending the ex32 Penn. Rep., 478, 484; The People vs. Munday, ercise of the appointing power are clear enough 72 New York Rep., 445; The People vs. The May- to any candid mind, however party zeal and or, 79 New York Rep., 582.) If there is some vicious usages may have obscured them in the evidence of cause for removal, the courts will not minds of the mere politician. The same rules of review that evidence, though they might in the duty which forbid the use of the people's money first instance have reached a different conclusion. for private and party purposes, also forbid the (The People vs. Campbell, 82 New York Rep., exercise of any branch of the appointing power 247.) — Nearly all appointed officials, save those for the same purpose. The fact that the public: having a fixed term, hold during the discretion of conscience is outraged at every falsification of the the official having the appointing power, or, in public accounts and every peculation of the pubcommon phrase, "during his pleasure." A simi- lic moneys, yet takes but languid notice of the lar right of removal during the term exists in appointment of the friends of thieves to be conthe case of appointed officials having a fixed term stables and marshals, of ignorant politicians to be of years. Contrary to the general opinion until justices, or of second or third class lawyers to be recently, the power of the president to remove judges, though abuses and disqualifications on (or dismiss) an officer of the army or navy is the the part of these latter officials may be ten times same as his power to remove a civil officer; but the most disastrous, only illustrates the lack of congress has so regulated that authority, that, political education and the need of reflection upon without the concurrence of the senate, the power all that pertains to one of the most vital and poof summarily discharging army or navy officers tential powers of government. We allow, all "in time of peace" can not be exercised " except over the land, officers to appoint, almost without in pursuance of the sentence of a court martial, criticism, an incompetent relative, or an ignorant or in commutation thereof." (Blake vs. The Unit- electioneering partisan, to official places, by reaed States, 13 Ott Rep., 227, 237.) This liability son of which the public business greatly suffers of all officers of the army and navy, confirmed and official life is made disreputable; though we by the senate, to be removed at any time by the should be justly astir for a conviction, if a single mere concurrent act of the president and the par- dollar had been taken by a letter carrier, or a pair ty majority of that body, has, unquestionably, a of gloves-on which we, perhaps, had paid no vicious tendency; drawing those officers into pol- duties-had been abstracted by a baggage inspectitics, and causing them to more and more dread It will be a great advance of public educapolitical influence and to court the favor of parties tion and of the public welfare in many ways, and their leaders. This power of removal is held when we shall have an intelligent public opinion in partisan circles, and very generally on the part which will be indignant and outspoken upon of the politician class, to mean a right to remove every prostitution of the high trust of the apin order to promote the interests of the dominant pointing power for party or selfish ends. And it party or faction, and even if not, yet in order to may not be without use to invite special attention realize the political ambition of the appointing to the study and reflection required for compreofficer. The threat or fear of such use of it is hending how profoundly, and in what manifold made effective for extorting political assessments, ways, in federal, state and municipal affairs, the and for compelling the officials of the government honest use of that power, for the selection of the to become the henchmen of parties and chief- wisest, purest and most efficient, could be made tains. This prostitution of the power of removal, potential for the purification of politics and elevalike that of the power of appointment, has been tion of official life. Such teaching should find a one of the most potent agencies by which the place in our schools and colleges. It is now the public service has been demoralized and degraded, accepted opinion of a great proportion of our and the spoils system has been made potential. people, if not that this power may justifiably be or. |