The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1840-07-02

nave had no artificial distinctions, no entalled
estates, but every man has been allowed TO be
the arifcer of his own fortune. Ii is this prin-
ciple which has constituted the life of our social
system, and the essence of our republicansm.
Whoever, sir, would suppress credit, and thus
cut oil our young men, who are born 10 no in
heritance, from the means of ENJOYING property
whoever would suppress credit, and thus exclude
competitions ofbusiness and of society, all those
who depend merely ON their industry skill, and
good character, strikes al the most republican
feature in our whole system
IL is said that our credit system has its evils,
ITS changes, and its fluctuations. Our popular
Government, too, has its evils its changes and
It's fluctuations. As well might we abolish our
free institutions, and substitute an iron depotism
that knows no change, as abolish credit and
settle down III the stagnation Of hard money
currency. We do not discontinue the use Of
steam, because there is now and then an explo-
sion. All agents which are powerful for good,
will, when mismanaged and misregulated, be
also powerful for evil. While we are suffering
the evils and abuses of credit and paper money
let US not, in blind fury, fall upon the system
Itself, and break its whole machinery 10 pieces
Let US rather adjust its disordered parts, apply
the proper regulating power, and put il again in
TO equitable and safe operation.
4 II was very common error, Mr.. Chairman,
TO imputc all our monetary revulsions to the
banks and to paper money. Whoever will read
attentlvey the very able letter of President Dew,
will, think, be convinced, both by his clear and
conclusive reasoning, as well as by his appeal
to facts, that II was the course OF trade, and not
the banks, which produces these revulsions in
great majority of cases Fluctuation Of prices
| is a necessary incident to commerce, and must
4 always occur wherever commerce IS carried on,
no matter what kind of currency is used The
history OF commerce contains abundant instances
Of monetary revulsons in exclusive hard money
countries. IT, therefore, we would avoid huc-
tuatons and revulsions altogether, we must give
| mp, not only paper money, but commerce itself
a paper currency, by its elasticity or capability
OF expansion and contraction will better accom-
modate itself TO the wants of commerce than
| hard-money currency; and If the amount Of
! paper does not bear too large proportion 10 the
specie, enough of the latter can commonly be
taken out of the country TO settle the balances of
trade without danger to the former The true
point to be guarded is, TO keep the paper money
convertible. Provided that is done, the amount
OF II should be determined by the wants of com
mcrce and of business
In connexlon with this subject, a new doctrine
has been recently advanced which deserves the
grave consideration of the American people. II
Is now alleged that, under our system Of credit
and paper money, we have too greatly enhanced
the price of property and the cost of production.
Those who adopt this reasoning say that prices
depend on the quantity of currency, and that in
proportion as you increase or diminish the
amount of circulating medium in the same pro-
portion you enhance reduce the nominal price
both of property and labor. comparison IS in
| stltuted between the United States and England
France, and Germany and it is alleged that the
redundancy of our currency has so greatly en-
HANGED the cost of manufacturing, that we can
not enter into successful competition with these
| Tnra rh.,
SO well stated in the printed speech hold in my
hand, that will ask the Clerk TO read the pas
sages have marked. The Clerk here read the
following extracts from the speech of Mr.. Blu
chanan, of Pennsylvania, delivered in the Sen
ate, January %, 1870:
" On Friday last, when | very unex pcctedly adj
dressed the Senate, stated principle of political
nomy, which | shall now read from the book 1t il
this that il you double the amount of the necessary
circulating medium in any country, you thereby dou-
bic the nominal price of every article. IT, when the
circulating medium is fifty millions article should
cost one dollar would two it, without any in
crease of the uses of circulating medium the guam
| tity should be increased TO one hundred millions
The effect would be pro,lucest whether the cir
culang medium specie convertible bank
paper mingled with specie II IL the increased guam
tiy of the medium, not its character, which produces
this effect. OF course leave out of view rrcdeema-
| bic bank paper"
'The discovery Of the mines in South America
metals put into circulation in the form of money have
greatly enhanced the nominal price Of all property
| throughout the world:
! The United States carry trade with Ger
many and France the former hard-moncv country
and the latter approaching it nearly TO have no
bank notes in circulation under the denomination of
five hundred francs or nearly ono hundred hundred
dollars On the contrary, the United States is en-
phatically paper money country, having eight hun
drcd banks of issue; all Of them emitting notes of a
denomination as low five dollars and most of them
one, two, and three dollar notes For every dollar of
gold and silver in the vaults Of these banks they issue
three four and five and Of them as high as ten
and even fifteen, dollars of paper. This produces a
vast but ever changing expansion of the currency !;
and consequent increase of the prices of all articles
the value of which is not regulated by the foreign de-
mand, above the price of similar articles in Germany
and France, At particular stages of our expansions
we might with Justice apply the principle which have
stated TO our trade with these countries, and assert
that, from the great redundancy Of our currency nr
Giles manufactured in France and Germany for
one-haf of their actual cost in this country Let me
present example. In Germany where the currency
is purely metallic, and the cost of every thing re-
duced to had-moncy standard, piece of broadcloth
can be manufactured for fifty dollars the manufacture
of which in country from the expansion Of our
paper currency, would cost one hundred dollars
| What is the consequence The foreign French or
German manufacturer imports this cloth into coun
try, and sells IT for a hundred dollars Does not
every person perceive that the redundancy of our cur
rency is equal to premium Of one hundred per cent
in favor OF the foreign manufacturer No tariff of
protection, unless it amounted to prohibition, could
counteract this advantage in favor of foreign manu-
features. would to Heaven, that could arouse the
attention of every manufacturer of the nation to this
important subject
What is the that our manufactures have
been able to sustain any sort of competition even in
the home market, with those of British origin 1t is
because England herself is to a great extent paper
money country though in this respect not 10 be com
pared with our From this very cause, prices in
England are much higher than upon the continent
The comparative low prices Of France and Germany