Spirit of Jefferson. [volume] (Charles Town, Va. [W. Va.]) 1844-1948, 1869-01-05
Mr.. Mortop's Defence Of his Plan of
Resumption.

The following are the principal points
You devote yourself chiefly to the establish
ment of the proposition that the government
can and should at once resume specie payments
with only S70,000.000 of gold in the treasury,
and that the declaration Of resumption would
have the effect to bring the greenback currency
to par.
Your argument is excellent to prove that
after the greenback currency has been brought
to par it would be preferable to gold, and
but little of it would be brought to the gov
greenback currency is three cents under par,
that margin would make it profitable to
brokers to run it into the treasury from every
part of the United States.
According to your plan, the banks must
resume at the same time with the govern
nent, and the S70,O00,000 of gold in the
treasury would fall short of their greenback
reserves twenty or thirty millions. To make
themselves strong, they would have to convert
their reserves into coin, which would require
more than the government could furnish at
the time, which. would result not only in a
panic among the banks, bat among the PED
ple and leave the currency in "a much worse
condition than it is now, and most likely bring
on crisis and crash.
But then you go on to say that you would
not rely only on the 10000, 900 of coin in
the treasury, but would forthwith issue new
bond, to run one hundred years, to be untax-
able, and to draw interest at the rate of four
per cent; and this bond, you believe, could
be foated at par in gold. This belief, on your
part, proceeds upon the fundamental error
that by declaration Of resumption the green
backs would be suddenly brought to par, for
it would be preposterous to talk about selling
four per cent. bond at par in gold while the
currency is still deprecated, and bonds draw
ing six per cent. interest in gold are worth
! less than eighty cents on the dollar.
You rely upon legislative declaration of
resumption to bring the greenback currency
suddenly to para result which can only be
effected by time and ample preparation for
redemption. You rely upon sudden and spas
modic action where there should be no spasm
or violence, and where the great result should
be reached by gradual approaches from the
adoption of measures that would command
the confidence of the country without disturb
ing its business.
Again you say:
"The one thing necdful for resumption is
to provide some form of national obligation
which the holders of greenhacks will prefer
to coin-in other words, some government Sc
curity which will largely sell at some rate
we can resume with but ten millions Of coin
in the treasury. Without it we may fail to
maintain specie payment though We begin
with coin reserve of two hundred millions"
| 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, 00G,0 600
of gold in the Treasury, and that the one
thing needful for resumption is to pEoYide
new bond, which the holders of greenbacks
would prefer to coin, which will sell at pre-
MUM above specie par and that when we
have got SUCH bond we can safely resume
with ten millions of gold in the Treasury
Here you would seem to make resumption
impossible by requiring in advance national
security which will largely sell at some rate
above specie par, which the holders of green
backs will prefer to coin, and which you have
before said should bear interest at the rate of
four. or five per cent. Such bond could not
be sold even at par, until after resumption is
firmly established, much less in advance, IS
a means of bringing it about
With such bond, which the holders of
greenbacks would prefer to coin, the green
in large and sudden contraction, which would
be in hostility to your first proposition that
the people need the greenbacks and will keep
them. Your policy, like that of the Secreta-
~ of the Treasury, resolves itself finally into
contraction, and if, to the evils of immediate
resumption, you add the calamites of large
contraction, you will make short work of the
business of the country.
In answer to Mr.. Grecleys argument that
the effect of RESUMPTION, gradual as we'll as
sudden, would be fall of prices and apprecia-
ton of debts, Mr.. Morton says:
IF sudden resumption would involve the
great decline in prices which you say it will,
it would be a vast calamity to the majority
of the people of the United States. 1t would
|. certainly bankrupt or suspend three fourths
of the business men Of the country at once.
1t would produce suffering and desolation
of which we have no record in this or any
other country. Hundreds of thousands now
living in comfort would be reduced to pow
erty. Business would be destroyed. the poor
left without employment, people unable to
pay their taxes, aud the government itself
threatened with bankruptcy and dishonor,
and yet you say you want to nal e the plunge
at once. If the private Indebtedness of the
people to each other on the 1st of February.
1860, amount to S9,O00 100000, the capaci-
ty of the debtors to pay, by your lowest esti~
mate, would be diminished to the extent of
S2,000,0 100000 You may be ready to make
the plunge, but the great body of the people
are not.
In reply to Mr.. Greeley.s argument that
Mr.. Morton's plan dooms all the business to
thirty months of painful uncertainty-an ar
gument which he illustrates by the action of
Congress in checking contraction as SOON as
its influence began to be felt-Mr. Morton
says:
"By fixing, time for resumption and maxi
ING the necessary preparation: all painful un>