Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1869-01-09
PRACTICAL VIEWS ON FINANCE:

Geo. Opdyke, Ex-Mayor OF new
York City, has addressed a letter to
Senator Conkling ofthat State on the |
question most important and promi-
nent before Congress-the resumP-
ton of specie payments.
Opdyke is practical man and
his letter is forcible document.
The following extract contains the
gist of his recommendations:
Having looked at our financial situa-
ton in all its material aspects, and having
shown by reliable statistics how far our
paper issues exceed the impassible limits
Of a sound convertible currency, We are
prepared to consider the means best cal~
culated to bring us safely back to specie
| payments.
From what has been said it will be
readily seen that any successful effort at
resumption must either be proceeded by
contraction equal to our present excess
of currency, or must be postponed until
our commerce rises to the level of our
currency; or until the equalization is
brought about by the joint influence of
contraction and commercial growth.
No other means or device, however
ingenious, will secure permanent re-
| sumption. If the effort be made
without first enforcing the requisite
contraction, specie payments cannot be
maintained for week, as is proved by
/ Il c,,I &C. III. Nrk 70 n
ton made by the Bank Of England in
| 1917, under similar but far less unfavor-
able circumstances. If, on the other
hand, the requisite contraction be made
suddenly, with view to early resump-
ton, it would produce momentary strin'
| gency and shrinkage of values before
which the wealth of the country would
disappear like the scenes Of dissolvine
view II would block the wheels of com.
merce, paralyze industry, oyerwhelm the
i country in financial embarrassments and
force the government, the banks, and tht
whole debtor class into c common lnsoi'
vency or suspension of payments This
as | have shown, h as been the uniform
experience of the nations making like
efforts under similar circumstances. The
effort therefore,. would produces
irreparable injury, and at the same tim
fail in securing its object. Resumption
instead of being FASTENED by IT, would b'
indefinitely postponed.
, What, then, is the proper rcmedy 10
existing defects in our CURRENCY ! an
; swer. dMasterly inactivity" | canno
ioin Mr.. McCulloch and others in thei
! | denunciation of that currency. 1t ha
but two serious defects-namely, its de
probation and the uncertainty as to tn
: | future action of Congress in reference +
; | il With these exceptions 1t may b
Justly regarded as the best circulatin
medium that any nation has ever pos
, | sessed
There is general Misrepresentation a
, | To the economic effects Of q currency de
: preciated as ours is, not from any mis-
trust Of its ultimate redemption, bu
| simply from its redundancy. The gen
, | eral belief is that such currency is Il
> all respects vicious, and that it tends 4
= | impoyerish the nation that resorts to 1t o
, tolerates it. This is an error. Its hrs
effects are, while the process of imitation
| continues, to enhance prices, to stlmulat
commercial activity and speculation, an
f to transfer portion of the wealth OF tn
q creditor class to the debtor class Ihes
eifscts, although the enhancement 0
I prices leads the community to belleV
! that thew are growing richer, are IN
mixed evils. On the other hand, whel
contraction is in progress, the effects ar
to depress prices, to paralyzc industry
= and to transfer u portion OF tn
wealth of the debtor class to the cred
itor class, thus making the rich richie
# and the poor poorer These. again, ar
J. unmitigated evils If, however, the in
fation be arrested at any given point
L and steadfastly held there, the currency
n although as redundant as ours, wOul
perform the Office of money in all respect
save one as well as coin or converhbl
paper, and in many respects much bettel
G 1t would, for example, be more unltorI
in its measurment of values, because
l. would be less variable in quantity Q
It volume. This above all other qualitie
a is essential to a good circulating medium
since without it no man can safely ente
/ into time contracts 1t would also b
V more convenient for use than coin, an
=. more cheaply transported, and its less
destruction would not, as with coin, be
IS loss of real value, since it costs nothin
q to produce, and hence its issuers woul
. gain by its destruction what Its owner
II lose. To these advantages we may ad
IL the profits which accrue to those VIII
p issue it, "a for example the annual saw
: ing of $2l 100000 in coin by the gov
y ernment of the United States on its out
d standing issues of $366,0O0OOO green
backs, for which it has received valu
but on which it pays no interest
g The evils Of imitation we have alread
suffered. These, therefore, cannot b
avoided; nor can they be repeated if "
Il steadfastly resist every attempt at fur
), Their imitation The evils incident t
. Sntraction-which are of still NOR
y serious character, | think-may be In
}, great measure avoided by remaining com
e parativeIy passive, relying mainly on on
growing wealth and commerce to etfac
the difference in value between our pa
= per money and gold, as they certainl
. | mill do in dua time