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The panic of 1893 was the worst economic downturn for the United States during the 19th Century. It was caused by overbuilding and over-speculation, labor disorders, and the ongoing agricultural depression.
The Treasury was required to issue legal tender notes for the silver bullion that it had purchased. Owners of the paper currency would then present it for gold, and by law the notes had to be reissued. This process depleted the gold reserve in the Treasury to less than $100 million.
The Sherman Silver Purchase Act of 1890 was created by the administration of Benjamin Harrison in order to increase the amount of silver in circulation. The drastic rise in silver caused the American people to believe that the less expensive silver was going to replace gold as the main form of currency. The American people therefore began to withdraw their assets in gold, depleting the Treasury's gold supply. Cleveland was forced to repeal the Sherman Silver Act Purchase in 1893.
Cleveland turned to J.P. Morgan to lend $65 million in gold in order to increase the Treasury's reserve.
The Wilson-Gorman Tariff of 1894 lowered tariffs and contained a 2% tax on incomes over $4,000. The Supreme Court ruled income taxes unconstitutional in 1895.
The Wilson-Gorman Tariff caused the Democrats to lose positions in Congress, giving the Republicans an advantage.
Grant, Hayes, Garfield, Arthur, Harrison, and Cleveland were known as the "forgettable presidents."
The Civil Rights Act of 1875 supposedly guaranteed equal accommodations in public places and prohibited racial discrimination in jury selection. The Supreme Court ended up ruling most of the Act unconstitutional, declaring that the 14th Amendment only prohibited government violations of civil rights, not the denial of civil rights by individuals.
Slavery and Its Legacies in North America
As Reconstruction had ended in the South, white Democrats resumed their political power in the South and began to exercise their discrimination upon blacks.
Blacks were forced into sharecropping and tenant farming. Through the "crop-lien" system, small farmers who rented out land from the plantation owners were kept in perpetual debt and forced to continue to work for the owners.
Eventually, state-level legal codes of segregation known as Jim Crow laws were enacted. The Southern states also enacted literacy requirements, voter-registration laws, and poll taxes to ensure the denial of voting for the South's black population.
The Supreme Court ruled in favor of the South's segregation in the case of Plessy vs. Ferguson (1896), declaring that separate but equal facilities for blacks were legal under the 14th Amendment.
War and Diplomacy