The weekly pioneer and Democrat. [volume] (Saint Paul, Minn. Territory) 1855-1865, 1858-01-28


and labor, during the period Of expansion.
must finally be liquidated during period of
contraction, when thu value Of money, rrla-
lively to property, commodities and labor,
has appreciated perhaps twoiold. To pay
debts contracted according to the nd yalua
ton with means estimated according TO the
new, necessarily involves great sacrifice.
The man who has given his obligation Tor
$4,000, as the purchase price Of certain
property in the time Of expansion. and ia
called upon for payment in the time Of con.
traction. when the property purchased has
deprecated perhaps one.half does. il he res.
ponds. suffer corresponding loss. Now, it
is perfectly obvious that, il the contraction be
general, involving the whole, IA large sec.
ton OF the commercial world. il il absolute.
" impossible that all the debts contracted
upon the former basis OF value, should hc
paid in full npoa the new basis Of value.
Every kind Of property and commodity
which il the object OF commerce hay
ing deprecated in its value relatively to
money. debts contracted when the prices
were high canno. be lquiiatei when the
where The depreciation being general,
loss equivalent TO the per cent. of deprccia-
ton must, IN the process OF liquidation, be
borne either by the creditors or the debtors
II the debtor pays his debt in fell, he hears
oil the loss il he pays only such proportion
Of it Us is indicated by the ratio which the
new value Of commodities has to the old, the
creditor bears all the Ioss. This il an ineyi
table result Of the process Of expansion and
contraction. which, us we have seen, IL the
necessary law Of paper money, Practically.
however, the result in much more dcplora.
bic. In n vast majority Of ins,anccs the
creditor sus,ains much greater proportion
of the loss than IS indicated by the per cent.
of general depreciation 10 which We have
referred. The experience Of past commor-
cal rcyulsions has shown that, in cases OF
forced liquidation, not mn average Of ten
cents on dollar Of the debts IL ever paid,
Indeed, the records show that, of the $40.
100000 Of indebtedness tina, went through
bankruptcy under the late national bank
rupt law less than one cent on a dollar wds
erer pad. We may safely estimate that
| the debtors who have been or shall be com.
PEELED, by the recent commercial disasters,
TO suspend the payment of their obligations
will never, on an average, pay ten cents on
/ dollar of their Indebtedness.
/ Al this Is the dircc, and unavoidable re-
sui, Of the paper money system. To this
must be added the dire panic, and the meal
culable suffering and distress, and the wide
spread ruin which surely follow in the wake
of every commercial rcyuIsion. Upon this
towering accumulation Of evils. must still be
laid another more serious, perhaps than all
the Others. and which has recently called
down the powerful ard pnngen' animadvcr-
sion Of the London ImeS, viz the general
and rapid decentralization which the undue
spirit Of speculation produced and fos'ercd
by credit money, is engendcriDg IN the com
ncrcisl world. This. IL the nJs, alarming
result Of the practical operation Of the Fys-
tenn and one which should not fail Ia engage
the earnest consideration Of every moralIst,
patriot aud christian.
Now, pray what good does the paper
money System afford 10 Offset against tbis
array Of evil? We have already showu
briefly that even during the period Of appa.
rent prosperi'y--that is, while the expab-
sion !. going on-no one IL really benefited
Ly the system. n the price Of labor IL in
creased 80 !. that Of the necessaries Of life.
II we get more for what we scIl ~ do We pay
more for what We buy. IF The value Of what
we have TO dispose Of has been enhanced 80
likewise has the value oi That which We
wish 10 acquire We gain nothing, there
fore upom this score. We can purchase no
more u the necessarics. convenience or cle'
ga1cies II life, or ofanything else u which Nc
may stand IN need. With our two dollar. u
credit m0n"y IN the state of things which
that money las induced than We could with
our spe dollar Of real money, u credit money
hal bad no existence.
We gain nothing by the system during
tie period Of expansion, and ye, run the
hazard Of being utterly ruined by the
contraction Blu, says Que: Surely the
Banks gain by paper money, or they would
~, issne il indeed. you have jus, shown
,ha, tbcy issue i, for the very purpose Of
the profits which i, affords Bu, il mus,
Z. 81 4. 4