The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1873-01-17

while the notes of the United states are lawful
money and legal tender, and are both depre-
deem except with United States notes. 1t is the
UNITED STATES NOTES THAT STAND IN THE WAY
tanned at par with CON- the obligation of the
banks 10 maintain their notes in coin would be
the national banking system would be demon.
strated IL would no longer be a monopoly but,
under the law as 1t now stands. would be free to
plethora OF money at one time and It's strIngency
at another would be regulated by the redemption
when required by new demands. Any attempt
to make corner by locking up currency III one
bank would be met by its issue by another. This
corresponding privileges and burdens OF bank OF
issue would relieve them from prejudice. The
maintenance OF Their notes at par with gold, TO,
be recognized as an equivalent for the privileges
they enjoy. Again, all the existing laws author,
were only issued, however. during the
msns There Po @edu SPecs pS
except the public. credit We could not
utilize the public credit i'm in borrowing money until
purpose we carried the public credit into limited
amount OF lawful money, but promised to pay this
We did not anticipate the extent OF it's deprecia-
ton ana constantly kept in view its speedy re-
demptlon: Ordinarily the practices of govern
ment in furnishing money is limited to stamping
upon gold and silver of certain weight and fneness
It's intrinsic vaue. Here It's duty ends But
IN WAR TIME
this process Of coming did not meet the public
necessities, and the United States carried its credit
all departments OF the government. Still tins
money is but form of public deht-a promise to
National Ranking act Congress assumed that the
United states would maintain its paper money at
par with coin as soon as its necessities would allow
1t provided for an auxiliary currency also to be at
par In geld and to be issued 10y banks. Every
provision of that act contemplates that both
United States notes and bank bills should be equal
the provisions for redemption and for large re-
serve The Banking act also anticipated that the
United States might withdraw its notes and then
that bank notes were directly to be redeemed with
coin. Still the Bank act provided for the common
| existence OF both kinds OF notes. and experience
| shows that both may be maintained In circulation
with profit to the United States. While no pro-
notes the provision for the redemption of bank
| notes in nullifed. Our whole system Of
currency becomes incongruous by our ar. failure .d to
IT, then, public faith public policy and the spirit OF
our laws demand that our currency be restored to
the specie standard, 1t would seem that the only
remaining inquiry should be,
WHAT IS THE BEST WAY TO RESUME.
But here we meet the objection OF many business
men, the most active and enterprising OF our peo-
pie, who tell US hat specie payments with them
adds largely to the burden OF our debts; that upon
the basis OF the existing Jaw and the condition OF
inhatOn always produced by deprecated money
they have made contracts, contracted debts pay
the value of that currency, is to embarrass,
cripple and ruin them. Some tell us they are pre-
ments caused by the increased business and credit
OF the country, while others tell US that the coun-
try needs more currency; that its growth In
population, expansion in business and new enter
prlses render an increase OF currency indspensa-
Bile. The effect Of any measure upon the interests
OF active business men should be carefully studied
but individual hardship is not sufficient reason for
O. violation OF pubic lalta or disregard
Of The general interests or policy no, OF the
action of the policy OF the government.
The act Of Congress already cited, the decision Of
- I'm ttaal nfnv sifP
parties are well known to all intelligent men, and
the effect OF specie payment il greatly exaggerated
TO the persons 1t Will iniure. Our business men
are not only. debtors, but they are creditors II
they are. injured by adding to the burden or their
debts they are benefited by the increase OF value OF
whether as inancier or manufacturer, me.
chanic or a abOrer, is injured; for. II the nominal
vane OF his productions is diminished, the cost of
living and all that enters into the cost OF prOduc
ton is diminished in the same degree. Experience
mas shown that depreciated money Is
MOST INJURIOUS no LABoRIsG MEN,
1t produces false standard Of value the effect OF
which is not noticed by laboring man, or by a
trader or merchant Even upon current debts and
credit the effect OF specie standard will surely be
appreciable for the nominal loss will be discounted
In advance or be divided during the gradual appre-
citation Of paper money. The greater burden Will
! fail upon debts running q long period Of time, as
those in existence before the Legal Tender act took
effect 1t Is but right they be paid In specie, while
those contracted since nave Seen issued IN the eX
while the effect OF specie standard upon debt is
greatly exaggerated 1t cannot be denied that If 1t
Is followed by contraction OF the currency 1t will
cause distress and embarrassment to very many
who have contracted debt on currency basis
But
If we are controlled by it we can never pay our
pensioners; the lapse OF time VIII not make It
stronger that we can afford to do right, and yet in
such way as to injure IN the least possible degree
those who contracted debts on currency sasls.
Again, the effect OF specie standard in producing
q contraction Of the currency is greatly exagger-
ated. contraction OF the currency is not neces.
contraction Of the currency would produce specie
payments. 1t is the most direct road to specie
payment, and Ii the paper money in circulation is
In excess OF the wants OF the community II Is the
only road. We in 1866 and 1867 quietly con-
hundred nSdre ne millions ' Of debt q compound
interest and other rates, most OF which were part
% ae S a Il in s
notes to be used for five per cent bonds at par We
would have long since been at specie pay ments. The
notes then could have been paid out again for the
payment OF current expenses and the purchase OF
bonds, precisely as now, when gold Is sold for
notes ana notes applied to the purchase OF bonds.
standard the moment our five percent bonds were
worth par in gold The advancing credit Of the
nation would have lifted our currancE to par in
gold precisely as 1t lifted all forms OF
bonds to par, or when par in gold: and now
rapid Md 'I payment y Of the debt as induced
by the advanced valve Of our notes In gold. we can
raise their value to the specie standard much more
readily than ouY years ago. Our faacy lies at the
foundation Of the objections to specie standard,
that 1t necessarily compels withdrawal OF paper
currency. This depends entirely upon the amount
necessary to conduct the business OF the country
and the degree OF public confidence In Its redemp-
ton.
Mr.. Knox, the Comptroller Of the Currency, in his
last annual report shows that in January, 1867,
when specie payments we're suspended, the aggre-
gate circulation oil coin and paper was $44s 2lS
or ratio Of 27 per cent Of the wealth Of the United
states, and that the circulation in the United
states In 1870 including United States notes,
6ank notes fractional currency and specie,
was $3.50, 1000 or 262 per cent OF our
wealth. The circulation In the United states per
capita is now less than In France and greater than
in Great Britain but greater than In either in pro-
portion to the wealth. When consider the vast
extent Of our country its rapid growth, the value OF
our productions and the general use Of paper