The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1854-12-22

Manu- sc' urers, rsdeGnen and corporations
continue to curtail the tails Inn nts by dis
charging Eorkm ard employ 8; md, in COO
sequence, the suppl Of labor fr &c edng the
demand, wages fal steadily. To aid to the
distress oi those who are throsn on. OF en-
ployment, fool and the other ecessaries Of
life have not fallen in price. Meat still COM
mands IA cent per ound, butter 2j cents, po-
tatoes from 81 rs to IS, according to quality,
-four sl2 per barrel, md grocerie, the same
prices as were paid when the imitation was at
its height. If there has been any decline in the
values Of these art cles it has not been felt by
the masses Fuel 10 more expensive than ever;
the DO rest kind Of anthracite coal sells at 81
50per shors ton. Rents will obviously show a
heavy fall next quarter-day: for the present
people who pay still square accoun's with their
landlord on the basis Of last years price,.
Thus the poor are grooming under tn, double
infection of low wages and high prices at the
came time.
The question is constantly asked: when VIII
-four, rents and coal fall? Why should labor
be the only commodity that the hard times
seem to have deprecated?
These are pregnant queries, demanding for
their solution careful thought and unbiased at
tention: not difficult to answer to those who
grapple with them unshacklsd by theory, bat
totally inexplicable to the class which seeks in
political economy nothing beyond q con6rma-
ton # preconceived doctrines
Prices are nothing more than equivalents.
When tie said that the price Of barrel Of -four
is ten dollars, nothing more is meant than that
thatsu Of money is equivalent to that quantity
Of -four. 1t is so, in consequence Of the relative
proportions then existing in the community be-
tween the supply Of and demand for -four, and
the supply of and demand for dollars If the
quantity of -four in the market increases, with
out corresponding increase in the quantity of
dollars, the proportion is disturbed, the former
equivalents cease to be true, and barrel of
-four becomes only equal to, or worth nine or
eight dollars instead of ten. In like manner,
if the quantity of dollars increases, and that of
-four does not, the proportion is disturbed, the
old equivalents cease to be correct, and the
barrel of -four becomes equal to or worth eleven
or twelve dollars instead of ten. This is the
whole secret of political economy the true
key to our late infiation and present suffer
ing.
For instance. In 1848, five years of mode
rate prosperity had enabled the country to re-
cover from the depression Of 1s37-'43. Disco
veries Of gold in California, and subsequently
in Australia, deluded mankind into the widest
visions of wealth. People actually fanciod that
this increase Of specie was tantamount to an
increase of riches, and credit expanded accord
ingly. In other words, dollars and representa-
tives of dollars were manufactured by the hun
ls48 had liabilities, or promises to pay"
aloat to an amount of $271, 146, $50, increased
the same between 1S48 and 1854 to $443, 200, 113:
thus adding over one hundred and seventy mil
lion Of dollars in the shape Of bank notes, Gre
dts, &C., to the stock already on hand. Again,
in the same period, railroad companies ran in
debt to an amount probably equal in the ag-
gregate to two hundred million Of dollars repre-
sented BY stocks and bonds. Other corpora.
tions and individual merchants put out cbliga-
tions of various kinds to something like an equal
amount, all of which the public confidently re
ceived as representatives Of value. Altogether,
between 1913 and 1854 it is likely that the stock
Of paper money OF all kinds, from the one dol
lar note of the West to the railroad bond or
mining share manufactured in Wall street, was
Increased at least gig hundres, au,,,on =,
dollars.
This at once disturbed the Proportion former.
" existing between real estate, merchandise,
and labor, on the one hand, s.ad dollars on the
other. The supply Of t..ae former having re-
manned comparativ. ely stationary while that of
the latter hac. doubled, prices rose in proper
ton. fisst real estate, then merchandise, then
farm produce, then labor swelled in value.
People said it was an evidence Of pros
perity. Twas nothing, in fact, but an attempt
to re-establsh the equilibrium of values which
the increased supply Of paper money had
upset.
in the public mind, and one by one these paper
dollars in the shape of.bonds, notes, stocks, and
other securities" ~ began to depreciste. The
downward march was rapid. In very few
months, about one-ffth of the increase Of the
former six years was lost by depreciation
stocks, bonds and notes having become value
less, and ceased to represent dollars at all
Then the banks became unsteady, and by cur
failing their discounts, at one stroke struck out
Of existence . large proportion Of that class of
securities to which individual credit had
given rise. The work still continues. Every
day we note the humiliation OF some large class
Of paper representatives Of value, and the conse-
quent reduction Of our stock of dollars. There
yet remain, however, far more of them than a
healthy state Of trade would justify. Such are
stocks and bonds Of Improbable enterprises,
notes and deposits in unsound banks, promis-
sorry notes Of insolvent traders, &C., &c. These
still exist, still represent dollars, and conse-