The New York herald., 1871-12-26

The RssaseIaI OsnAiftsn ef France, anA
TIA, ComDsreS with Ours.
The proposition 10 increase the paper circu-
lation OF the Bank OF France sfor the relief Of
trade and commerce" as the bill before the
French Assembly expresses II, has called forth
great deal of discussion, both in and out the
legislative hall, as we'll as some apprehension.
The question Is still pending. The committee
having charge Of the measure agree as to the
principle Of 1t, but had not determined what
amount Of augmented circulation should be
authorized. 1t was supposed the committee
you'd recommend an increase OF two thousand
seven hundred millions Of francs-equal to
about FIVE hundred and forty millions Of dol
lars. This would be an enormous issue, and
1t is possible some mistake as 70 the figure,
has occurred in transmitting the telegram
Still 1t is evident, from the financial situation
of France aud the recent Message Of President
Theirs to the legislative body. that very
large increase Of circulation is contemplated.
A portion Of this ID to be In small
notes, something like our fractional currency,
only, perhaps, Of lower denomination than
oirculates now among us. The drain of specie
to pay the war indemnity to Germany, and the
exigencies Of the government to meet the
enormous demands upon II, have brought
France to the necessity Of Initiating the our
rsncy. The effsot is already seen 10 the de-
probation Of bank notes. True, the premium
on coin is not great, but the tendency must be
to increase that unless the French dnanciers
prove more skilful than ours did In similar
crisis Notes Of the Bank Of France used TO
be at premium compared with gold and sil-
yer. Now it is otherwise, though the differ
enoe ID yet small. s.a .seea--rs Il. a4.dsg es
Mr.. Michel Chevalier, In discussing tho
national finances Of France and the proposed
measures Of relief, makes some excellent re-
marks and . comparison between the fnan-
cial condition and policy OF his own country
and OF the United States He says France
will have to negotiate other large loans, and
that 1t will be difficult to place them except
upon very onerous conditions, unless the
present process of or tendency to depreciation
be checked. To obviate the dinaoulty he pro-
poses to follow the example Of the United
States In paying the interest Of the debt in
coin and Of providing for that by making
customs duties payable In specie. He
thinks the depreciation Of paper money
would be checked and the credit Of
the government be sustained by expressly
st,pulating to pay the interest on loans In coin.
We began this policy late, and after our green
backs wetS much deprecated. Perhaps
France might check the depreciation of her
paper circulation while it is but little below
the par Of gold ny such . policy. There is
one remark made by this able political econo-
mist which deserves special notice and which
is full of instruction fos us. s'One Of the
means" hs says, "for restoring the value OF
the bank note is to act upon the course OF
exchange so that it shall bs favorable to MS
while 1t really is against US. Each successful
effort we make to convert foreigners into our
debtors will modify the course Of exchange In
our favor. Now the expectation Of French
goods would evidently have that effect; there-
fore, It is our interest to facilitate the devel-
opnent Of our export trade" This is the
principle upon which England has acted all
through her successful commercial history,
and which has made her the richest nation 40
regards capital in the world. She began this
In the dawn Of commercial Development in
Europe, when the Bank Of England was In its
infancy, and when that great institution began
the policy Of regulating the exchanges Of the
world. By the cunning devlce Of trans
ferring capital, oven wen not needed
for trade, to certain points. in order to mako
the exchange favorable to London, the Brit
isb, at % early period, turned the financial
centre from Holland to their own metropolis.
By the profits Of exchange and the advantage
Of capital thus acquired they began to develop
their manufactures and exports They have.
held this position throughout and now hold
the greatest power over the finances of the
world. Michel Chevalier understands the
value Of the lesson given. Increase your
exports, he says to France, and thus become
creditor nation instead Of being . debtor
one, for debtor nation is always dependent
and the exchanges against 1t Do we not need
this advice as rnnoh ~ Franoes Are We not
all the time piliug up greater debt abroad
through the excess Of imports over exports
This is subject Of vast importance, which
our government should well consider. With
the vast wealth, productions, resources and
wonderful development of this country we
ought to establish such a sound policy a. will
not fail to stimulate exports and turn, at no
distant day, exchange In our favor. That
would establish specie basis, with no fear Of
revulsion, and we should cease to be at tho
mercy Of foreign bankers, the accidents Of war
abroad or any other European influence.
ayTHEr ARE QUorNo SCRIPTURE out West In
support Of the democrstio passive policy. The