The Portland daily press., 1868-12-19
Saturday Morning; December 70, 1893.
Senator MOrton's speech On the ResumP
don Of Specie Paymenls.

-
don Of specie Payments.
The speech delivered in the Senate on We'd
nesday by Senator Morton Of Indiana Is pro
nounced the ablest and best considered as
cussion Of the financial situation that the
country is likely to be favored with aafl''g the
present session Of Congress Inc oeNa'oi oe' /
yins nv. lav;no ouf OF the case all OF the
schemes NJ resumption that conflict with his
own. He will not heac of contraction as q
preliminary step TO gold payments, holding,
"a most Western and many Eastern men Go,
that the volume OF currency IS not relatively
,sxeatef nov than in 1850, taking into account
the growth of the country in population and
business Neither does he believe in Tire eff
cacy of an improvement of he general credit
of the government and the appreciation of its
bonds in value as means Of gradual ap-
proach TO resumption. II is not the redun-
dancy of the currency nor The depreciation
of our bonds that make the greenback worth
50 much less than gold, but its ir9edseH'a't'ffg'
II there were only million oi 9reenhAcSS
and the government had no DEBT eesiues sen
ator Morton argues with mhee iofce that they
would still I've at discount u thes were not
navab,a n, demand. The promisscry notes of
man worth millions are not negotiable az
mar If legal proceedings are necessary TO Sc
cure their payment, aud tlcir value would be
greatly diminished il there were no means of
forcing settlement, as IN ease Of the govern
ment. He critcises with great Severity The
recommendations OF ;he Secretary OF The
Treasury, who, by the way, sat near him dur
ing the delivery of his speech. He would not
legalike gold contracts, The Sfcretary's prop
osition 70 fix the time when ereanbaeks sl,all
cease 10 be legal tenders except for govern
ment dues he denounces rs clear act of re-
pudiaton, not differing in principle from that
proposed by the President. After consider
ing and rejecting the Suggestions of Others
he Senator explains his own theories thus:
To return 10 specie payments Without
crash is the great desideratuin and this can
only he done by making the process gradual
Time Is a necessary element, snd the first aues-
ton TO he. considered is tho period which
should be fixed by government TO begin the
redemption OF grecDback notes, and In my
bill have stated the first OF July, 1871 Fix
ing tune must be starting point of any
plan which proposes TO bring about redemp-
tion without a crash and d disaster. Iu pro.
posing to give two years and bait 10 begin
the work Of redemption, have several ob-
iectS in view. First by establishing period
Of redemption. a fixed value is gwen green
and deceptive Sometimes averaging as much
as 10 per sent. in 60 days and scarcely eyerre
manning the same for week at time but by
hKing the tine tor its redemption, a certain
value Is gwen to it, Ii the note is TO be maid
in gold on the first Of july, 1871 its status To.
D. day can be determined by the ordinary rules
OF discount and will steadily improve az tie
time for its redemptionapproaehes and othtl
preparations being properly made il will be-
at par on or before the day xed for its redetop
iion by gradual appreciation. BY fixing the
time Of redemption one chief element in the
value OF all commercial paper is gained-tbat
OF q certainty in the time OF payment Sec
ond, by fixing the period OF redemption the
country is notified and may he prepared for
the change. The people will have in yicw
IN making new contracts aud arrangements in
business and debtors fearing decline in the
prices of property viii make haste to nav
their debts. During this two and a hall wears
the great body of existing debts among the
people will be paid The debt now contracted
whicn VIII not iaii due for two years aud
malt is very small and is generslly ior real es-
tate: The great difficulty generally attend
ing improvement in value Of currency in the
resumption of specie payments, where they
nave been suspended, is the reduction in
nominal prices of property and labor, which
operates iDjuriously upon the debtor class
Ii is generally true that as tie PURCHASING
power OF the currency Is increased tha nom.
inal prices OF property are diminished But
the effect IS sometimes eoanteracted by in
crease in volume OF the currency, Initiation
OF the currency, even though it be conposed
OF gold and silver exclusively, increases the
nominal price of property, of which we have
notable instances in the history of Spain -
When resumption takes place. all gold and
silver WIN be set Tree and poured into the vol
ume OF the currency thereby initiating il to a
considerable extent, because the whole amount
OF gold and silver is very much greater than
the whole amount of greenbacks that will be
presented for redemption. But, as before stat
ed, the period of redemption is postponed so
low fIaft h, III, ~
win be paid before it arrives, and the sieclen-
sion in the price of property which il likely to
BE- small, would affect but very limited class
and would scarcely reach the general business
OF the country The time given is SO long that |
it will become stale in the public mind. All
excitement and panic will pass away, and the
change come so gradually that the people will
have forgotten 1t when it arrives. Thirdly
nxing the period Of resumption so lar OF that
government win have time to collect the
amount of gold that will DO necessary; ard
hrst, will consider the amount of gold that
viii probably be required, and With which it
Will be safe to begin redemptioD. It was
shown by the history Of banking that solvent
and well conducted banks can safely carry on
operations when they have one dollar In gold
In their vaults to three dollars of their circu-
iation. Ii is also shown by bank history that
banks which have suspended specie payment
out whose solvency and good management are
not suspected, have been able to resume when
they have gotten into their vaults one dollar
onlation. The credit Of tho Government is
better than that of any bank aud can in nv
.oplnion. resume on o smaller proportion of
gold than any suspended bank under the old
rule. Ihe greenbsck notes, notwithstanding
their depreciation, have one great merit which |
did not belong to the paper of any of the old |
State banks, which is that they are of uniform |
status IN every part Of the United States |
Iney are FAR more convenient than coin for all |
business purposes. They can be sent 10 every |
part OF the country in payment of debts better
and cheaper than the transportation of coin. |
Under the old State bank system, to which ii |
is hoped the count. will never return, there |
was Tar greater demand for gold than would |
occur under the present It Is doubtful |
whether as much as one hundred millions of
gFeenback notes would be presented for re-.
aemptien when greenback notes are as good
as gold, unless for specific PURPOSES for II |
would be an Inconvenience and burden Tho |
whoie question may be thus stated III the
government is strong with gold to redeem all
notes that may be presented, but little gold
will be demanded, because 1t will Re worth nn
more than greenbacks. But if the Govern
ment is weak and only able TO redeem a small |
part OF the currency, the gold will he hastily |
drawn out to sell in the market at profit. To |
obvlate the danger of the banks presenting
their greenback reserves for REDEMPTION the
bill proposes that the banks shall not be re-
9uirsd to redeem their notes in specie until
ths hrst Of January, 1872, and during the pre-
cedIng six months shall be required TO hold In
their vaults the same amount Of sreepback
reserves, in which they tuay as now redeem
their notes. If during that period they are re.
CURED to hold these greenback reserves as
now, OF course they cannot rush TO the Treas
ary with them TO get gold, and ut the end of |
tnat time the Government will be able 60 meet
their demands without trouble or danger. To
give banks six months to redeem their notes
an gold, and perhaps may move to make il a
year beyond the time when Government be.
gins redemption Of greenback currency, or
perhaps Tor national bank notes being con.
vertlble into greenbacks, they will be Of equal
value and at par, and persons holding bank
notes WHO want gold for them will only have
to present them to the banks and receive
green6acks in exchange, on which they would |
get gold.
News Items.
A most improbable rumor comes from New
York stating that the National NJ anu {scturers'
Association held secret meeting there on
wednesday, when resolutions and addresses