The spirit of democracy. [volume] (Woodsfield, Ohio) 1844-1994, 1854-03-01
For the Spirit of Democracy.
"Money and Currency"
NUMBER Nv,

uOhio" on this subject, the author sets out
with two propositions, the first of which is,
that, "our banks of circulation. as at pres
ent constituted, are the bane and the de.
struction of our MANUFACTURES And the
second one. that mo country can fully
develope its own resources, or enjoy all
ihe advantages Of its natural capacity for
the creation of wealth, without division
Of labor" The latter proposition is GER
tainly correct one; and although, it may
be- regarded as source of some gratifi-
cation that "Ohio" is not on the wrong
side Of it. but on the contrary defends the
proposition with commendable zeal and
ability, yet the idea is by no means new
one; it is an important plank in the plat
form of the great .sAmerican System,"
originated and defended by such men as
Clay, Webster. Adams, Jackson, &c., &C.
Then It's, with the doctrines of the former
proposition, that the writer proposes to
deal in the present number.
Are sour Banks OF circulation, as at
present constituted the bane and the de-
struction Of our manufactured" In the
first place "Ohio' seems to labor under q
grand delusion, one which is altogether
fatal 10 his arguments. He assumes the
position, that the manufacturing countries
of Europe are hard money countries hav-
ing no banks Of circulation. Hence he
says, "lhe European buys his materials
and manufactures his goods a, hard money
prices, and he sends here and sells al our
inaated paper money prices,-he, there
fore. demands and receives the specie.
Thus while he sells at the inflated paper
money prices, with merely such deduc-
lion as enables him TO drive our own citi.
zans out of the market. he really gets those
enormous prices in gold and silver, and
carries them home. where their value is
not deprecated by paper issues" Can il
he possible that ..Ohio" has never heard
Of the Mammoth Bank Of England. with
It's tremendous capital of some $65, ,OoO.-
900, and which receives in its ordinary
transactions, about four millions Of dollars
in notes dailyl The whole number OF
joint stock banks in England. in 1910. with
their branches was 658, to which add $50
private banks. and the number is 1908.
In Scotland there was at the same period
l69 banks and branches, making an ag-
gregate of these s.soft money rnints" OF
1877, in England and Scotland alone.
Z" Almost all Banks in this country are
Banks both of deposite and issue. IN
formation fer the People. by Chambers,
vol. 2, page 267. And on page gil, speak
ing of the Scottish banks, the author re-
marks: "From the first issue Of the bank
notes in 1904. to the year 1880, single
panic or general run did not occur in Scot
land, although, during at least two-thirds
Of the intervening period, paper money
had been used to the almost total exclusion
Of q gold currency" And on the curren-
cy of Great Britain he continues: "Bank
notes and bills together constitute the pa
per currency Of the country. 1t is calcu.
lated that while the metallic currency sell
dom exceeds three millions of pounds
sterling. the paper currency or amount oi
negotiable paper in circulation, is perhaps
two hundred millions of pounds" Cor
about $3.50, 900. 900, vol. 2, page 265
Add to the above, the 800 millions oi
pounds sterling of government securities,
or per cent consols, which enter largely
into the business transactions Of commerce
and trade, in the shape of medium o'
exchange. and the reader will be enabled
to form tolerably correct opinion of the
kind, and extent, of the currency employ
ed by the greatest and most successful
manufacturing country in the world.
Were we to make comparison be-
tween the paper money circulation Of Grea,
Britain, and the United States, we would
perhaps not find ii very different. in pro.
portion TO the metallic basis of each; MOI
would it be very material, provided it was
well secured. and convertible at the will o
ffie holder into specie. The two countries
are 60 closely identified in their CONNER
ciaItransacfions and interests, that no per.
manent expansion can take place in the
business circulation Of the one. but it will
pass off and waste its force in the other
and thus ne eutralize itself, having found its
level. Just ssas naturally will this be the
case as that the wide waters Of the Allan.
,ic, which separate the two countries. will
find its common level. after having been
disturbed by gale. Seeing then t,at the
hard money OF Great Britain is fully as
soft as our. own, we must seek for other
causes. than those alledgsd by "ohio, for
the flourishipg condition Of their manufac-
iurss, and The sickIy condition Of our own
t. will be borne in mind, that although
Grsst Britain is wealthy nation, with a
denss population. her wealthis not dis