Daily Ohio statesman. [volume] (Columbus, Ohio) 1855-1870, 1865-05-10
The Finances.


To the consideration of the Finances, the
financial editor of The Chicago Times de-
votes the following:
The Bankers Magazine for May and the
New York papers republish aletter written
in January last by Professor Goldwin Smith,
relative to the financial affairs Of the United
States, in which he uses the following Ian
puage: II went TO America convinced That,
amidst much that was truly great, the finan-
~cial administration was the weak point, and
/ Ihavesreturned with that conviction terri
bly confirmed. The root Of the mischief, L
venture to think, is the legal-tender act" Pro-
fessor Smith is right, and the publication
of his letter in the principal financial peri
odicals In the country and in the metropoli-
tan Journals Is evidence that the people are
already beginning seriously to examine the
financial difficulties which surround them
The more close and thorough the examiDa-
tion. the more will the evils of the legal
tender act become apparent, and the more
sure and prompt will be the condemnation
of the people upon the men who imposed
these evils upon the country. The people
were prepared for taxation, expected II,
were willing to submit to 1t, and, If our
financial policy had not been dictated
by timorous, cringing fear of public sem
timent, and by selfish ambition, which
hesitated in the path of duty lest personal
interests might be endangered, we should
have had taxation from the commencement,
which should have enabled the Government
to borrow such loans in gold as 1t required,
and to have brought the war to close with
out real suspension of specie payments.
Instead of this we have the legal-tender
act which robbed one-half of the people
of the debts honestly due them from
the other half which has introduced
confusion and uncertainty into every
branch of business, which has deranged
prices, provoked speculation, piled up an
enormous public debt at fictitious prices to
be ultimately paid in gold, and now promises
to continue the calamities of war for many
months after the dawn Of peace. A system
so vicious was never before conceived, and,
when the people come to properly compre-
hend the matter,-and the burdens of taxa
ton, and the evils flowing from the disar-
rangement and uncertainties of business,
will soon enlighten them,-there is little
doubt but they will desire some radical and
prompt remedy. There can be no such
thing as fixed values, and certainty and re-
liability in business, until the system Is
abandoned. If it takes one hundred years
to redeem our debt, and during that time
the treasury notes are maintained as legal
tender, the country will not see one day in
of produce and general merchandise be
driven up and down with every breath.
To-day there is legitimate demand for
gold in the payment of duties or the pur-
chase of foreign exchange, and it rises in
value, and everything follows; tomorrow,
the demand is supplied, the price recedes,
and values of all kinds decline; the next
day, speculation carries it up, and, the day
after, speculation carries it down again. Its
fluctuations will regulate the price of every
thing the people buy or sell, and they will
be regulated by causes which no experience
or wisdom can foresee, or caution or pru-
dence guard against. And, as long as this
continues, there can be no such thing as
real, sound commercial prosperity, or safe,
reliable business. The question must be
fairly and squarely met at some time
Dodge it and defer 1t as we may, it will GER
tainly occur until it Is disposed of, and we can
seenO cause why the Congress OF 1865 should
not as well settle the matter as the Congress
of 1865; for, the sooner 1t Is settled, the soon
er will the country commence recuperatinS
its strength. TO us, the proposition made
some days ago still seems fair and proper
and at the same time. promises an ample
remedy. We are at a loss to see what pos
sible evil could result from repeal of the
legal-tender act, At made to 60 into opera
tiOn at day two or three months after the
repeal, and then only with reference to con.
tracts negotiated after that day. Nobody
would be robbed, as in the passage of the
legal-tender act; but few, If any, could bt
injured; and all would be benefited. Thert
is numerous class who believe that ther,
can be no return to specie payments unit
the currency is largely reduced, and they
are opposed to any reduction of the cur
rency because they fear the interests of tn,
;,,.t. hxrt tl,a
duction. This tear Is not without its found
alton; but it seems as if the mere repeal o
the legal-tender clause, without a restric
tion of the volume OF the currency, wOulC
not work any injury to the commercial o.
industrial interests of the country, because
its effect would be, while restoring coin tt
circulation, to place the treasury notes ir
precisely the position occupied by banl
notes before the war, which, though not {
legal tender, were received byevery ont
for Just their specie value. Some Of those
bank Bills were received at 5 per cent, some
at 10 per cent, and some at 20 per cent. dis.
count, and, If the legal-tender clause were
repealed to-day, each treasury note woult
be received at 80 per cent. discount, because
1t would bring that In gold. There woult
still remain as much money as ever In the
country, or, rather, the treasury notes
would perform Just what they do now
Wheat is now worth 81 Is per bushel; but
If coin were made the basis of all transac-
tions, wheat would be worth Just 801&t
per bushel, and, II the merchant elect
ed topay for tin treasury notes at discount
of 30per cent he would pay just the samt
amountin paper as hepays now--$1 15 PEI
bushel. Gold would once more become th,
acknowledged standard, regulating al
values, and the prices Of grain and genera
merchandise would fuctuate no more thar
they did before the war. All changes il
the value of any commodity would be oc
casioned alone by the relation of the supply
fothe demand. Paper money, even, woult
acquire q value which would not change
except very slowly and gradually, In obedi
ence to the same general laws which con
troll value Of other things. The mis-
chievous feature Of our system is the at
tempt to make paper standard Of values
when it has no intrinsic value of Its own, o
any value generally recognized; and, as
cofseduence, our standard Of values Is con
stantly changing its own value, and every
thing else must follow. Repeal the legal
tenderclause, restore gold to its proper pc
sition, and we win once more have stand
ard which will not change with every pass
AZ the country settles down to a stead
and Legitimate business, the demand 10
treasury notes 10 use as currency will gro'
less BY degrees, and, as aconsequence, the