Western Reserve chronicle. [volume] (Warren, Ohio) 1855-1921, 1868-01-01
When 10 Resume.

ScHSC VI tuC pcOplo - uuluAo-
tably in favor of the resumption of spe-
Gle payments. The question Of great
est difficulty is, when can il be made
practicablei
We have heretofore suggested that
if Congress were to fix q period for such
a consummation, the act itself would
facilitate resumption, because 8 de-
cline in gold would inevitably follow
its passage. We do not mean that re-
sumption can be secured by mere legal
enactmenG, but we may refer to history
for precedent to prove how great assist
ance legislation can render. The
course of the Bank of England, from
date of the commencement of its en-
barrassment in 1877, may be reviewed
with special interest and advantage at
the present time.
When, through various causes, the
specie in its vaults had been reduced
to s1, ,270.8 800 in 1877, the Parliament.
in order to prevent any further drain.
passed the celebrated Bank Restriction
Act, exempting the bank from redeem
ing its notes in specie, and authorized
it to issue 81 and e. legal tender
notes in place of coin. This initiated
that famous suspension Of specie pay
ments which so enhanced the price of
precious metals in England IS TO drive
all gold com out of circulation and
raise the premium on specie, as COM
pared with the notes of the Bank, to
maximum Of nearly 80 per cent. This
maximum was reached in 1873. 1t
was not as great as the highest rate
reached for American gold during the
continuance Of the late rebellion, but
it was sufficiently large TO make the
peculiarlties of the case entirely appli.
cable to our present and immediate re-
quirements, and the remedies then
adopted equally efhcacious for our re-
lief.
AS in our own case, so in England,
the return Of peace in 1914 brought
about an immediate and considerable
decline in tbs rate of premium and
this was assisted by q forced system of
contraction imposed by Parliament
lAs between contraction and initiation
a remedy for our financial difficulties,
there can be but one rational choice
Adding more promises to pay will not
liquidate our Indebtedness canceling
those promises certainly proportionste-
ly-bvt man, by too strenuous effort
to clear himself of debt may 50 cramp
and impoverish himself as to render
the payment OF. the balance of his obli-
cations utterly impossible. From the
same point of view we dsprecate too
rapid contraction, in our national
management.
We have remarked that the first
step toward resumption in England
was contraction. Parliament attempt
ed to designate when full resumption
should take place. How successful the
attempt proved is shown in the fact,
that although the Restriction Act of
1877 named "six months after the
signing of treaty of peace ii was not
until tlceHty-one years after the Egning
of suehstreaty (the treaty of Amiens1
that full resumption was accomplished.
1t was found utterly impossible to en-
force resumption at the period first
designated much so as to make
water run up bill by legal enactment
and therefore the time was postponed.
The suspension was continued from
year to year until 1919, when q new
plan was devised and recommended
BY a Committee of the House of Com
mons, Sir Robert Peel, chairman, and
in what Is known as the |
First Peel Act ;" this was a scale of
graduated prices, to continue in use
ind operation for two years and half
mo to regulate the exchange of paper
or specie. The Bank, however, did
lot fully avail itself Of the privilege,
,ut commenced full resumption in
nay, 1878, just twenty-six years after
he date of suspension. During all this
ime the Bank of England notes were
as legal tender throughout
ne United Kingdom.
Now, if the United States were to
,ontinue to do business on paper ba-
is for ten years longer, it need not
eel humiliated before nations on that
ecount. Perhaps, it may find upon
that it viii be obliged 20,
$ England did but that IS not probs-
lie. With a capital doubling every
en- years, as ours does, and the taxes
Te raise absorbed directly by the pro-
lctive industry of the country with
eW inventions flooding the Patent Of
ce as they do, and our population in
reasing in wonderful ratio with our !
nercantile reputation kept untarnish-
d and the national credit kept sus
aimed by prompt and honest CANCEL
ng of its obligations as they fall due,
re may at least devote our serious
houghts to the question Of when shall
take place. Should Con-
ress fix the time, either in the imme-
late or more distant future, it may be
,und necessary. when the time comes
, postpone resumption, as England
id, time and dagsin or if the attempt
lg resumption in full is too great an
then We can adopt q
ale of graduated prices TO continue
ntil such time as ''psr" is reached.
nd paper and bullion meet on an equal
,oting. One thing, however, is posi-.
We, and this we have always insisted
pom that no resumption can take
ace without an accumulation of spe-
e IN the Treasury amply sufficient to
rye as basis for redemptioo.-HaTP- 7
. W,sESf