The Burlington weekly hawk-eye. [volume] (Burlington [Iowa]) 1860-1876, 1864-12-24

Ne
BrLL.-Mr. Stevens gold bill shows in q
very striking manner how profound Is the
ignorance even among statesmen OF the
most familiar truths of economical science.
The Romans in the time ofthe empire pro-
hibited the export Of gold and silver under
heavy penalties. England did the same
thing by early statutes, and even Ne late az
the time OF the great bullion controversy
in 1871, when guineas were currently
bought at . premium, and bank notes were
at on open discount Of above 10 per cent.
as compared with gold bullion, large
majority Of the house Of commons agreed
to the resolutions of Mr.. Vansittart declar-
ing that the promissory notes Of the Bank
Of England had hitherto been and now at
that time held to be, in the public estima-
ton equivalent to the legal coin Of the
realm. In his speech on the currency in
October, 1910, Mr.. Huskisson showed the
absurd results Of such legislation, as illus.
trated by the statutes against clipping or
melting gold coin. The standard weight
ola guinea was as about dwts. 9 1-2 grs.,
and it was an offense punishable with
penalties 20 melt guinea weighing more
than 5dwts. grs., and an offense equally
punishable to sell or TO buy guineas at y
higher rate than twenty-one shillings each
in bank paper. Guineas of less weight
than dwts. grs. could be melted and
sold as bullion. The twenty-one shillings
grs. Of gold bullion. Hence it resulted
that while the guinea of full weight which
could not be melted was worth by law on
~ twenty one shillings in paper, the light
guinea which could be melted was worth
twenty-four shillings and six pence, max
ing the coin of the realm the more valuable
the more 1t was abraded!
The French government, so recently as
1857. appointed commission 10 inquire
into the causes Of the expectation Of silver
coin and Of its current premium over gold,
results caused by the great influx of gold
from California, and the stnrbance Of the
artificial exchange ratio between silver and
gold coins. This commission recommen-
ded high duty on the export of silver,
and heavy penalties against those ep9ag-
ing in the business, and compulsory
maintenance of the artificial relation be-
tween the two metals. which the progress
of discovery and tue immutable laws of
trade had overthrown. The conclusion of
the commission was arrived ut after exam
lining separately eight Of the NEST eminent
and enlightened merchants and bankers OF
Paris, each OF whom denied the wisdom
and exposed the futility Of such legislation.
The great Newton, when applied to by the
English government in 1917 to explain the
causes of precisely similar phenomena. re.
piled, that if silver left the shores of Eng
land, either in coin or bullion, and gave
place 10 gOlOs ~ WAS because the V8lu0
which the momentary legislation assigned
to it in relation to gold was not correct
and that II the legal relation between gold
and silver were re-established upon the
true basis, by that act the temptation to
export silver in preference to gold would
be destroyed.
So now we say to Mr.. Stevens, if green
backs do not exchange at par with gold, 1t
il because they are worth less, and no pos.
sible legislation can alter the fact. 1t is q
misfortune which we must bear patiently
till we can restore the equilibrium by nat
ural means. The making of government
notes legal tender was state necessity,
and iustifiable as such. Notwo currencies
of widely unequal value can circulate
together as money; the cheaper must
drive out the dearer and so, in making
paper legal tender, we have reduced gold
10 the condition Of merchandise, and it
will be worth more or less according to the
intrinsic and not conventional value of the
money by which it is measured. Specula-
ton may raise its market price, like that
of any other merchandise but it is willful
blindness to attribute the whole, or even
the greater part, Of its premium to this in