Chapter XX

Elections of 1862.--Mr. Lincoln advances to Aggressive Position on Slavery.--Second Session of Thirty-seventh Congress adjourns.-- Democratic Hostility to Administration.--Democratic State Conventions. --Platforms in Pennsylvania, Ohio, Indiana, and Illinois.--Nomination of Horatio Seymour for Governor of New York.--The President prepares for a Serious Political Contest.--The Issue shall be the Union or Slavery.--Conversation with Mr. Boutwell.--Proclamation of Emancipation.--Meeting of Governors at Altoona.--Compensated Emancipation proposed for Border States.--Declined by their Senators and Representatives.--Anti-slavery Policy apparently Disastrous for a Time.--October Elections Discouraging.--General James S. Wadsworth nominated against Mr. Seymour.--Illinois votes against the President.--Five Leading States against the President.-- Administration saved in Part by Border States.--Last Session of Thirty-seventh Congress.--President urges Compensated Emancipation again.--Emancipation Proclamation, January 1, 1863.--Long Controversy over Question of Compensation for Slaves.--Test Case of Missouri. --Fourteen Million Dollars offered her.--General Pope's Campaign. --Army of the Potomac.--Battle of Antietam.--McClellan removed.-- Burnside succeeds him.--Defeat at Fredericksburg.--Hooker succeeds Burnside.--General Situation.--Arming of Slaves.--Habeas Corpus.-- Conscription Law.--Depressed and Depressing Period.

CHAPTER XXI. The President's Border-State Policy.--Loyal Government erected in Virginia.--Recognized by Congress and Senators admitted.--Desire for a New State.--The Long Dissatisfaction of the People of Western Virginia.--The Character of the People and of their Section.--Their Opportunity had come.--Organization of the Pierpont Government.-- State Convention and Constitution.--Application to Congress for Admission.--Anti-slavery Amendment.--Senate Debate: Sumner, Wade, Powell, Willey, and Others.--House Debate: Stevens, Conway, Bingham, Segar.--Passage of Bill in Both Branches.--Heavy Blow to the Old State.--Her Claims deserve Consideration.--Should be treated as generously at least as Mexico.

CHAPTER XXII. National Currency and State Bank Currency.--In Competition.--Legal- tender Bill tended to expand State Bank Circulation.--Secretary Chase's Recommendation.--Favorably received.--State Bank Circulation, $150,000,000.--Preliminary Bill to establish National Banks.-- Fessenden.--Sherman.--Hooper.--National Bank System in 1862.-- Discussed among the People.--Recommended by the President.--Mr. Chase urges it.--Bill introduced and discussed in Senate.--Discussion in the House.--Bill passed.--Hugh McCulloch of Indiana appointed Comptroller of the Currency.--Amended Bank Act.--To remedy Defects, Circulation limited to $500,000,000.--National Power.--State Rights. --Taxation.--Renewed Debate in Senate and House.--Bill passed.-- Merits of the System.--Former Systems.--First Bank of the United States.--Charters of United-States Banks, 1791-1816.--National Banks compared with United-States Banks.--One Defective Element.-- Founded on National Debt.