The New York herald., 1871-01-04
ne government growing stronger in the actual

s lhe federal Treasury has mad In circulat for
demand, TO the amount OF s4Oo, 900 0Oo.
These notes. made lawful tenaer lor debts, con-
stltute now the money haollualy used by banks and
the people In all transactions. These promises the
Treasury docs not redeem. and this non-redemption
and nothing else makes the present condition OF
things which IL known as q suspension OF specie
payments. II the FEDERAL Treasury were redeemlng
ns notes IN CON the notes woulu be worth rs mucn
as god; In other words, the money now used ny
banks und the people would then be the same as
gold, anu such condition OF things would DC, OF ~.
return ay 10 seecs All that
Is neces ary TO establish such conditlon ls, tnat
its own tcs and nothing viii be required to mann
tain tnat same und condition nut that the federal
I.easary nan continue 20 redeem @ EN- a Inc notes
son they have no duties IN respect to II; tney are
helpless to put an end TO II; tney pay Their own
lawful money consists OF government notes, which
the government alone can make worth rs much as
specie. That once oone, banks and people, While
contnuing 10 pay their debts In this same kind OF
money, would be dealing in all transactions on the
There would be no shock to business in transit
uon SO edected. NO contraction OF the currency,
Snd consequently no strlngency In the money mar,
possession Of coin, among the people, would follow
IT, Tor man fcsting as they do now, great confidence
In the legal tenuer noLes, they would have still
more faith III tncm when IL was established that the
notes command coin at the Treasury on demand,
and tney would for convenlencs, prefer the notes to
g0td ITSELF Anything that the government shall do In
order to promote return TO specie pay menis, except
as much H as gold. WI, be not only ~ needless but mis-
chleyous. No new regulations for the banks are
necessary to sals ena ana needless regulations
legal tender year before last, when the notes
were worth seveaty-1ve cents to the dollar In gold;
the same notes when worth ninety CENTS they will,
win the same ease, pay Ia le9a. tender notes, they
beng equallv abundant, when they are worth one
hundred cents. and that will be paying specie
The treasury might easily have put Itself In con-
dtlon TO paw its legal tender notes on demand long
1. a
down TO the 1 July, 1870, the federal treasury has
received through It's Custom Houses. an aggregate
OF $y240G0 000 IN god coin. Ii 1t had laid aside only
dollar IN five of these receipts for the purpose OF re-
deemiDg It's legal tender notes. it would nave now IN
Its vaults $3.50 OF coin absolutely belonging to
ITSELF exclusive Of what Is retained from time to
time to meet accrung interest," ana exclusive also OF
Tne whole amount Of legal tender notes outstand.
ing Including fractional currency and making no
allowance Tor what rs Ost IL 1896 900 000) The fund
on hand for the redemption of notes would be now,
II one dollar III i've had been saved, nearly One-han
o. the amount oi notes IN circulation proportsn
It necessary to keep on hand to meet its circulation.
The superior credit OF the federal Treasury would.
OF course main am It's notes at par With gold on
much less Of coin than wOnld be required by
. private banxing incorporation. l cannot doubt
that the government notes would rise to par with
gold and be Kept there with fund OF coin devoted
TO their redempt ptOn not exceeding One-lOurth the
amount OF notes outstanding.
Under this policy I'VE would have resumed specie
payments naturally and easily more than two years
ago and 1t could have been pursued without iicon-
venience to the Treasury For, ever since the war,
both the aggregate surplus revenue OF the govern
ment and us surplus OF gold revenue have been so
great that It could have well afforded to put aside
dollar In five Of lis coin receipts. 1t could have
been pursued without inconvenience to private bust
ness, for our mines were producing more gold than
the Treasury would nave laid aside. The only COM
mercla effect OF the proposed process would have
OF SO much coin that might otherwise go abroad,
and that result oil men agree Is proper and vau
able means to convenient and permanent resump-
uOn.
Under this policy the government could now re-
sumo specie payments In less than years time.
t4o ooo oos OF coin OF Its own on hand. LIS gold In
come Is now nearly S2t0.0oO.0o0 year, OF which
less than sl2o 90 Is required to pay interest:
ting gold, less than a year would give 1t Q fund OF
$l01,oo0,ooO OF coin against Its circulating notes
The continuance Of large sal q OF gold during the
past season. when commercial causes have been
operat ng powerfully to keep down the premium,
sury may save either the whoe OF its surplus gold
income or one-naf Of 1t or one-quarter The result
would be equally certain IN any OF THESE cases; 1t
would simply be postponed in proportion the pro-
cess OF saving was made rapid or slow.
after it was known that the Treasury had adopted
policy leading, inevitably, TO an early resumption
No one would buy. except FOR immediate use, an ar
tlcle which was sare soon tO be worth no premium.
II, however u be deemed wise chat the Treasury hold
part OF its surplus gold revenue Tor the purpose of
checking BY the sale 1t at t.nes possible Specua.
ton let it do So but let 1t retain another portion
absolutely ana sacredy for the great purpose OF re-
Our path to the restoration Of sound currency Is,
In my Judgment, so sample, plain ana direct that
federal government as lacking the common sense
which Is every day applied Dy men 70 private Dasi-
ness. No private debt0r would be regarded as wise
(scarcelv nonesll who, having In circulation a large
amount Of notes Payable on demand, and having at
the same time an income in gold lar IN excess OF any
other demands on him, should neglect 10 apply his
surplus income 10 The purpose OF redeemIng his
notes. 1t would not be received as an excuse that
he preferred to pay IN advance certain 0blgatons
not maturing for many years.
1t Is obvious thar specie payments are not to be
restored long lie legal tender notes are In eA-
istencc. except ~ making these notes and gold
equal III current value. This only be done by
making the proportion Of co III the Treasury TO ts
outstanding notes suth as the Treasury may safely
undertake 10 redeem the notes on demand. such
Ing the uuantly vi the notes circulation by
creasng the quantity OF com III the treasury. Con-
traction in tne Quantity OF the notes was tried by
Secretary McCu.loch; but the process was so dis
tressing 10 the business OF the country that after
few mouths, ne was compelled by public oulcry TO
abandon Contraction OF this legal tender money,
however gradual, VIII lie found, II tried again.
to be a painful remedy. AS the notes become
scarcer and scarcer debtors viii find 1t less and less
easy TO procure the money they need. Banks Will
find it less easy to keep ON hand proper reserve,
and will be compelled to press their debtors. The
confidence of CREDITORS In their 1eDlors including
the confidence Of deposIors IN the banks. viii be
continually growing less with the growing scarcity
OF money. Capita will withdraw Itself more and
more from active enterprises; anu labor, conse-
quently, will nnd employment with constantly ln-
Creaslng diiIc Guilty That these would be the results
OF persistent contraction is proved by experience
In instances where combinations OF spectators have
succeeded IN locking up empolarlly u small guam
tity of the legal tender notes.
Islt net obvious tnat it would be wise economy for
The federal Treasury to get back, as soon as possi
BILE, TO paying It's debts III conn For then, with Its
credit perfected, the nego.la ION of loans ut very
low rates OF interest VIII ch 1t Is anxious to effect,
would be pra tcaDe. Is IL not equally obvious that
o return to spec payments, II brought about By
wise method, ould result in great good TO the pe0
pie? For the industry and business OF the country,
once r.d OF the emDarras sment and lack OF conf
dencn arising from the OF currency OF shifting
value would take Ire h start q career Of active,
stable and well assurei prssperlLy. We must,
or later return to lie use OF gold and silver; until
we do We shall CCntlnuc to be subject to frequent
anu discouragtng fluctuations In values, of which
we may not yet nave seen the worst
The people naturally shrink from the harsh
remedy OF contrac lOl. They 0ok upon 1t as one
which threatens, perhaps, greater evils than those
which they suDcr. II is unjustilable to resort
to 1t when another method viii accomplish the re-
suit.
FEDERAL INTERFERENCE IN ELECTIONS.
Ciana a. Ioarlc af,lo fh4a