The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1868-12-31
TEE FINANCIAL QUESTION.
senator Morton's Reply 10 Horace Greeley
A Defence Of the Senator's Financial fian.
Nv .sHINGrnN. ID. c.. Dec, 1868.

WAshiNotoFs - - D>~' -
Hon. HORACE GREELEY, New York.
DvAp srR-In your letter addressed TO me in the
s>rfn,ue M the 2lst inst. you undertake to answer
several positions taken by me In my late speech II
the Senate on the currency, but devote yourself
chiefly To the establishment OF the proposition thai
the government can and should at once resume
specie payments with only s7ooooooo OF gold In The
treasury and that the declaration OF resumption
youd have the effect to bring the greenback cur
rency TO par. and TO robut the idea that more thar
100000 900 would be required with which TO begir
resumption You say
You assume that If the government must IRE
deem the greenhack currency" / think Our bank
have resumed after months and OF
heir oasndng issues On the contrary the fact Of thei
resumption has uniformly prss1aed all desire or disposition
tender bad not the federal government behind them bn
waite corporations Yet all receiving payi
them out whou. asking for specie 70 the extent Of one dol
coin If You think the people who have so often shown
lions Would not now evnce al least faith Il govern
is, In henseyesyou have given me no reasons
for sharing your distrusl
You then enter into an argument OF some length
TO show the superior convenience OF the greenback
currency over coin. You show very clearly how
business would be impeded by a mere metallic cur
rency; that the business OF the country can De
better developed and extended by redeemable or
convertible paper currency, ana that the people
could not do without the greenback currency long
enough TO have il inSo the Treasury for redemp
tion III gold -,
preenback currency has been brought to par n
would be preferable to gold, and but little OF 1t would
be brought 10 the government for redemption bat
a. long as the greenback currency is three cents
under par that margin would make ii profitable to
brokers 90 1t into the Treasury from every part
OF the United States.
Again you say =
Let suppose the government resume tomorrow or, II
70 drain the treasury Of its seventy millions Of coin Not
you and ceainno the great busy active workers and
coin we have inducemen no motive to do So We should
es Sy s we DC now sending the mint Or treasury for
little coin change or to satisfy some other need The a
ss % a. paT T aRa IT, bring coin q" wiz
strong one who Would rush or COIN either fearing that the
Treasury would DESTROYS that should he dry How
money enough to drain the Treasury Of $70000OOr
Mind that every public Officer every m every solvent
business railroad every creditor every having
interest in the success Of the effort to maintain specie pay
ments Can you imagine that the lame ducks Of Wall street.
the SPECTATORS national dsbopo are strong enough to
overcome them
Here you assume the great fact to be established
that by the declaration OF resumption the greenback
notes win be brought TO par. According to your
plan the BANKS must resume at the same time with
the government and the $4,000, 900 of gold in the
Treasury would fail short OF their greenback reserves
$20,000,00O or S30,000,000. To MAKE themselves
strong they would have to convert their reserves
INTO coin, which WOULD require more IMAM the gov
eminent could furnish at the time, which would re-
suit not only IN panic among the banks but among
the people, and leave the currency In much worse
condtlon imam " Is now ana most llSey bring on
crisis and crash.
But then you 90 on to say that you would not rely
only on the $4,000 900 OF coin in the Treasury but
would forthwith issue new bond TO run loo
years, TO he untaSable, and to draw interest at
the rate OF four Per cent? and this bond you believe
could be doated M par IN gold.
This belief on your part proceeds upon the funda-
mental error that by declaration OF resumption the
greenbacks would be suddenly brought to par, for IL
would be pTeposterous 10 talk about selling four
per cent bond al par In gold while the currency is
still deprecated and bonds drawing six per cent
Interest IN gold are worth less than eighty cents
the dollar.
You Tely upon legislative declaration OF resump-
ton to bring the gIeenback currency suddenly 10
para result which can only be effected by time
ample preparation for redemption. You rely upon
sudden and spasfnodic action where there should be
no spasm OF Violence and where the great result
should bs reached by gradual approaches from the
adoption OF measures mat would command the con-
ndence OF the country without disturbing It's bust
currency ~ brought to par the gold paid out would
not pass INTO circulation, but sink back into an arti-
Gle OF merchandise TO be sold In the market
Again you say
The thing needful for resumption provide
orm national obligation which the holders OF grcenbacks
which win largely sell al some rate above specie When
com in the Treasury. may fan maintain
specie PAYMENT though begin with coin reserve OF two
This changes the whole character OF your propo-
stion and makes resumption look rather to contrac-
ton by funding than 10 redemption.
Your first argument was that greenbacks
were so much more convenient and desirable
than gold that they would not be presented
for redemption. But here you state that we
cannot safely resume even with $500. 600 600 OF
gold IN the Treasury and that the one thing needful
for resumption IS 20 provide new bond. which the
holders OF greenbacks would prefer to coin,
which will sell al a premium above specie par, and
that when we have got such bond we can safely
resume with $40 0ooOOO OF gold in the treasury
SpQ INN
bic by requiring IN advance national security which
viii largely sell az some rate above specie par which
the holders OF gfeenbacks will prefer to coin and
which yen have before said should bear interest at
the rate Of our or i've per cent. such a bond could
not be sold even al par until after resumption is
firmly established, much less IN advance, as means
OF bringing IL about.
WIN such bond, which the holders OF greenbacks
would prefer 70 coin the greenuacks would he
funded, and IT would result In large aud sudden
traction which would be in hostility to your first
proposition that the people need the greenbacks and
viii keep tnem our policy. like that OF the Secre
tary OF tile Treasury resolves itself finally into
traction aud II, 10 the evils OF immediate resuInp-
ton yoh add the caiamities OF large contraction
you VIII make short work OF the business OF the
country.
Again you say
The gs o. resumption general fan Of twenty-five 70
ae1s Make the process as gradual As You wl Involves
Mi be worth fewer doars than now because dsa vii
after resumption than they now do Wages mus
he eansiSbs Vii be sfSr good many Of u.s. We must SUI
Ter anyhow but prefer to take the plunge al once and %
done with H.
II sudden resumption win involve the great decline
In prices which you say II will IL would be q vas
calamity 10 TIVE majority of the people OF the United
States II would certainly bankrupt or suspend
threeo urths OF the business men Of the country AT
once II would produce a suffering and desolation o
which we have no record In this or any other coun
try. Hundreds OF thousands now living in comfort
would be reduced To poverty. Business would ~
destroyed, the poor left without employment, the
people unable to pay their taxes and tn,
government itself threatened with bankruptcy
and dlshonor, and yet YOU say you want u
make the plunge al once. II the private IN
debtedness OF The people TO each other on TIM
LIST February, 1862 amount to 5000 900, tht
capacity OF the debtors TO pay. by your lowest estl
mate would be diminished To the extent d
$4,000, 100000. You may be ready to make th,
plunge, but the great body OF the people are not
Your plan would SUIT admirably that class OF people
who are not In debt and have plenty OF capital o
who have fixed incomes which would be greatl
improved in value By the large decline In prices O
every other Kind OF property. Your plan would en-
rich the creditors by the destruction Of the debtors
for, as you say, the sherlii anu constable would b
after ''many OF u.s. our property would be sold ~
"a song and large balance OF debt be left agains
future earnings. And all this suffering and DIES