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LEGAL TENDER CASES.
practice of the Government, satisfied the Court that the constitutional authority of Congress to provide a currency for the whole country was now firmly established. This granted it followed that Congress might constitutionally secure the benefit of such a currency to the people by proper legislation. The prohibition in the Constitution against the emission of bills of credit by the States, and against making anything but gold and silver coin a tender in payment of debts, did not prove that a like limitation of Congress was to be inferred.
Indeed, the very limitation expressed in the Constitution against State emissions was evidence that no like limitation was intended on Congress. The logical and necessary consequence, then, was that Congress has power to issue the obligations of the United States in such form, and to impress upon them such qualities as currency, for the purchase of merchandise and the payment of debts as accord with the usage of sovereign governments.” Under the power to borrow money on the credit of the United States, Congress has as broad an authority as it has over a metallic currency under the power to coin money. Taking the two powers together, that of coining and that of borrowing money, Congress is authorized to establish a national currency either in paper or coin, and to make either of them lawful money for all purposes as regard the national government or private individuals. And this power of Congress to issue legal tender notes is not merely a war power but is equally within its discretion in time of peace. The wisdom of Congress would therefore determine when the exigency might arise, a political not a judicial question. For these reasons the Court sustained the constitutionality of the act of 1878, and held that Treasury notes were a legal tender in payment of private
1 Veazie Bank vs. Fenno, 8 Wall., 533.
debts and could be reissued and kept in circulation. The act of 1878, the constitutionality of which the Court had sustained, forbade a further retirement of the United States Treasury notes and directed that when redeemed at the Treasury they should not be cancelled or destroyed, except those which were too mutilated for further use, but should be reissued, paid out again and kept in circulation. The act of January, 1875, had provided for the resumption of specie payments on the first of January, 1879, and for the redemption of Treasury notes but the later provision was annulled by the act of 1878. The re-issue clause in the last named act became at once a bone of contention between parties. Its expediency, and, of course, its constitutionality, were insisted on by the Republicans. But the Democrats insisted that its prohibition of the retirement of the notes put the Government “in the anomalous situation of owing to the holders of its notes, debts payable in gold on demand which could never be retired by receiving such notes in discharge of obligations due the government, nor cancelled by actual payment in gold.” It was forced to pay without redemption and to pay without acquittance.2 It, therefore, worked as an endless chain emptying the national Treasury of gold.
Mr. Justice Field gave a dissenting opinion in the case, in which he reviewed the history of the bills of credit in the country, and of the clause relating to the subject in the Constitution; and particularly the history of the legal tender acts and of the act of 1878. “Why,” inquired he, “should there be any restraint upon unlimited appropriations by the Government for all imaginary schemes, if the printing press can furnish the money that
1 Guilliard vs. Greenman, 110 U. S., 421 (October, 1883).
2 Message of President Cleveland, December 2, 1895; Richardson, IX, 642.
LEGAL TENDER CASES.
is needed for them ?" If Congress possesses the power to make Treasury notes a legal tender and pass as money or its equivalent, why should it not issue a sufficient amount to pay the debt of the United States ? His reasoning led him to the conclusion that the decision of the Court was inconsistent with the letter and spirit of the Constitution.
The final decision of the Court in the legal tender cases was promptly utilized by the National Greenback party, which, in its platform of 1884, declared that the decision fully vindicated the party's theory of the right and authority of Congress to issue legal tender notes, and demanded the issue of such money in sufficient quantities to supply the actual needs of trade and commerce; and also demanded that Treasury notes should be substituted for national bank notes, and the public debt be promptly paid with them.1
A further illustration of the trend of later expositions of the law of the Constitution in so far as it affected the jurisdiction of the United States, was given in 1889, in the decision in the greatest of all the Utah cases, that relating to the disestablishment of the Mormon church.2 According to this decision, the power of Congress over the territories of the United States is general and plenary and arises from the right to acquire territory and from the power to make all needful rules and regulations respecting the territory or other property belonging to the United States. The principle which Chief-Justice Marshall had long before decided, the Court reaffirmed, namely, that the power of the United States to acquire
1 Greenback National Convention, Indianapolis, Indiana, May 28, 1884.
2 Mormon Church vs. United States, 136 U. S., 1-44. See also Jones vs. The U. S., 137 U. S., 202, 212; Lyon et al. vs. Huckabee, 16 Wallace, 414, 434.
8 American Insurance Company vs. Canter, 1 Peters, 511 (1828).
SUPREME POWER OF CONGRESS.
territory is derived from the treaty making power and the power to declare war. The power to make acquisition is incident to national sovereignty. The United States having obtained territorial government imposed laws upon it, therefore Congress might legislate directly for its local government and has complete legislative authority over its people. In the exercise of this sovereign authority, Congress annulled the charter of the Mormon church, confiscated its property and devoted it to public purposes. The great and far reaching principle in the decision was that the regulation of a territory by Congress depends solely on its discretion.1
In another Utah case the Supreme Court examired more in detail the power of Congress to regulate the domestic affairs of a territory. The people of the United States, said Mr. Justice Matthews in the decision, are sovereign owners of the national territories, and have supreme power over them and their inhabitants. In the exercise of this sovereign domain, they are represented by the Government of the United States to whom all the powers of government over that subject have been delegated, subject only to such restrictions as are expressed in the Constitution, or are necessarily implied in its terms or in the
purpose or object of the power itself; for it may well be admitted in respect to this as to every power of society over its members that it is not absolute and unlimited. But in ordaining government for the territories and the people inhabiting them, all the discretion which belongs to the legislative power is vested in Congress, and that extends beyond all controversy, to determine by law from time to time the form of a local government in a particular ter
1 Consult McAllister vs. U. S., 141 U. S., 174; Clinton vs. Englebrecht, 13 Wallace, 434.
2 Murphy vs. Ramsey, 114 U. S., 44.
SUPREME POWER OF CONGRESS.
ritory and the quality of those who shall administer it. It rests with Congress to say whether in a given case any of the people resident in the territory shall participate in the election of its officers, or the making of its laws; and it may, therefore, take from them any right of suffrage it may previously have conferred or at any time modify or abridge it as it may deem expedient. The right of local self-government is known to our system as a constitutional franchise, and belongs, under the Constitution, to the States and to the people thereof by whom that Constitution was ordained and to whom, by its terms, all power not conferred by it upon the Government of the United States was expressly reserved. The personal and civil rights of the inhabitants of the territories are secured to them as to other citizens, by principles of constitutional liberty which restrain all the agencies of government, State and national. Their political rights are franchises which they hold as privileges in the legislative discretion of the Congress of the United States.1
This interpretation of the law of the Constitution may well be contrasted with that political interpretation so long enthroned in power,—that Congress had no authority to legislate as to slavery in the territories, and the decision becomes of extraordinary interest in connection with the extension of the jurisdiction of the United States over Porto Rico, Hawaii and the Philippines in 1898. If the construction of the Constitution which this decision and others which it cited made is to regulate the government of these new acquisitions, then the American people, acting through Congress, can forbid the people of any of these new acquisitions to assemble for the purpose of political
1 See also Gibson vs. Choteau, 13 Wallace, 92, 99; Fleming vs. Page, 9 Howard, 603, 615, and Halleck's International Law, 3d Ed., II, 475.