H. Pendleton of Ohio introduced legislation that required selection of civil servants based on merit as determined by an examination. This legislation greatly expanded similar civil service reforms attempted by President Franklin Pierce 30 years earlier. In his first annual presidential address to Congress in 1881, Arthur requested civil service reform legislation and Pendleton again introduced his bill, but Congress did not pass it. Republicans lost seats in the 1882 congressional elections, in which Democrats campaigned on the reform issue. As a result, the lame-duck session of Congress was more amenable to civil service reform; the Senate approved Pendleton's bill 38–5 and the House soon concurred by a vote of 155–47. Arthur signed the Pendleton Civil Service Reform Act into law on January 16, 1883. In just two years' time, an unrepentant Stalwart had become the president who ushered in long-awaited civil service reform. At first, the act applied only to 10% of federal jobs and, without proper implementation by the president, it could have gone no further. Even after he signed the act into law, its proponents doubted Arthur's commitment to reform. To their surprise, he acted quickly to appoint the members of the Civil Service Commission that the law created, naming reformers Dorman Bridgman Eaton, John Milton Gregory, and Leroy D. Thoman as commissioners. The chief examiner, Silas W. Burt, was a long-time reformer who had been Arthur's opponent when the two men worked at the New York Custom House. The commission issued its first rules in May 1883; by 1884, half of all postal officials and three-quarters of the Customs Service jobs were to be awarded by merit. That year, Arthur expressed satisfaction with the new system, praising its effectiveness "in securing competent and faithful public servants and in protecting the appointing officers of the Government from the pressure of personal importunity and from the labor of examining the claims and pretensions of rival candidates for public employment." Surplus and the tariff With high revenue held over from wartime taxes, the federal government had collected more than it spent since 1866; by 1882 the surplus reached $145 million. Opinions varied on how to balance the budget; the Democrats wished to lower tariffs, in order to reduce revenues and the cost of imported goods, while Republicans believed that high tariffs ensured high wages in manufacturing and mining. They preferred the government spend more on internal improvements and reduce