As the depression following the Panic of 1873 deepened, President Grant came under extreme pressure to inflate the currency. Debtors, especially in the western states, cried out for relief from Washington.

Republican Party campaign officials panicked, too. They pleaded with Grant to sign a measure demanded by farmers and ranchers to print up to $100 million in greenbacks. Grant’s cabinet also favored the inflation bill. The president later reflected on the pressures—and his final action:

The only time I ever deliberately resolved to do an expedient thing for party reasons, against my own judgment, was on the occasion of the inflation bill. I was never so pressed in my life to do anything as to sign that bill—never. It was represented to me that a veto would destroy the Republican Party in the west. . . . I resolved to write a message that the bill need not mean inflation. . . . I wrote the message with great care and put in every argument I could call up to show that the bill was harmless. When I finished my wonderful message, I read it over and said to myself, “What is the good of all this? You do not believe it. I know it is not true.” . . . I resolved to do what I believed to be right [and] veto the bill.

Veto the inflation bill he did. And those Republican Party leaders were not wrong about the political consequences of such an act. The party suffered its worst defeat in its history that fall. The House of Representatives went from a Republican majority of 194–92 to a Democratic majority of 181–107. It was a net loss of eighty-seven seats for the Republicans.

After this, Grant’s honest efforts to help freedmen in the South were hampered by divided government.