Iowa voter. [volume] (Knoxville, Iowa) 1867-1874, 1873-12-11

owing to the general panic now prcShuIhR,
which commenced about the middle Of Sep.
tember last. The full effect Of this disaster,
II It should not prove to be "a blessing In dis
guise," Is yet to be demonstrated. In either
event II is your duty to heed the lesson and
proyidc by wise and well -considered legisia-
ton, as far rs 1t lies In your power, against
It's recurrence, and TO take advantage OF all
the benefits that may have accrued. My own
Judgment Is that, however much individuals
may have suffered, one long step has been
taken towards specie payments, that we
never can have permanent prosperity until
an entirely new basis is reached and main
tained-until our exports, exclusive OF gold,
nav for our importe, interest due abroad, and
other speculations 20 heavy rs TO leave an APP
probable accumulation OF these metals In the
country from the products Of our mines. The
development Of mines OF precious metals
during the past year, and prospective develop
ment Of them for years TO come, are crafty
ing in the extreme; could but one-half the
gold extracted from the mines be retained at
home our advance toward specie payments
would be rapid. To increase our exports,
sufficient currency is required to keep all the
Industries Of the country employed. With.
out this, national as well as individual
bankruptcy must ensue. Undue infa-
ton, on the other hand, while it
might give temporary relief, would only lead
TO an imitation OF prices The impossibility OF
competing In our own markctsfo the products
of home skill and labor, and the repeated
renewals Of expansions give elasticity to our
circulating medium, therefore, and just
enough of it to transact the legitimate business
Of the country and to keep all the industries
employed, is what IL most desired. The exact
medium Is specie, the recognized medium OF
exchange, the world over. That obtained, we
shall have currency of an exact degree OF
elasticity. II there be too much OF 1t for the
legitimate purposes Of trade and commerce, 1t
viii flow out OF the country; II too little OF 1t,
the reverse will be the result. To hold what
we have, and to appreciate our currency to
that standard, is problem deserving OF the
most serious consideration OF Congress.
TIN CURRENCY.
The experience Of the present panic has
proven that the currency of the country, based
as 1t is upon the credit Of the country, is the
best that has ever been devised. Usually, In
times of such trials the currency has become
worthless, or so much deprecated In value as
to initiate the values OF all the necessaries Of
life, as compared with the currency. Every
one holding II has been anxious to dispose Of
1t on any terms. Now we witness the reverse.
Holders of the currency hoard 1t as they did
gold in former experiences of a like nature. 1t
Is patent to the most casual observer that
much more currency or money Is re-
quired to transact the legitimate trade
OF the country during the fall and
winter months, when the vast crops are be-
ing removed, than during the balance Of the
year. Under the present system, the amount
In the country remains the same throughout
the year, resulting in an accumulation Of all
the surplus capital Of the country when not
employed In the moving of crops, tempted
there Dy offers of interest being paid. This
surplus capital must earn this interest paid,
with profit. Being subject to call it cannot
be loaned only in part, at best, to the mer-
chant or manufacturer, for fixed term.
Hence, no matter how much currency there
might be in the country, it would be absorbed,
prices keeping pace with the volume, and
panics, stringency and disasters would ever be
recurring with the elasticity I'm our money sys-
TEN. There Is this object to be obtained first,
and next, as far as possible, prevention
Of the use of money in stocks and other
species Of speculation. Toprevent the latter
1t seems to me that one great step would be
taken by prohibiting the national banks from
paying interest on deposits, by requiring them
TO hold their reserves in their own vaults,
and by forcing them into redemption, though
1t would be only in legal tender notes. For
this purpose would suggest the establish
ment of clearing houses for your consider
alton. To secure the former many plans have
been suggested, most OF which look to me
like imitation, on one hand, or compelling the
withour corresponding benefits, upon
the surplus funds of the country dur
ing the seasons when otherwise I'M
employed. i submit for your consider
alton whether this difficulty might not be
overcome by authorizing the Secretary Of the
Treasury 70 issue, at any time. to nominal
banks OF issue, any amount of their notes be-
low fixed percentage Of their issue, say 40
per cent, upon the banks depositing with the
Treasurer of the United States an amount Of
Government bonds equal to the amount of
notes demanded, the banks to forfeit to the
Government, say, 4 per cent of the interest
accruing on the bonds so pledged during the
time that they remain with the Treasury as Sc
curity for the increase of circulation, the bonds
so pledged to he redeemable by the
banks ut their pleasure, either in whole
or in part, by returning their own bills
for cancellation to an amount equal to the
face of the bonds withdrawn. / would fur
Their suggest to your consideration the pro-
priety Of authorizing National Banks TO d.
minish their standing issue at pleasure by re-
turning for cancellation their own bills and
withdrawing as many United States bonds as
are pledged for the bills returned. In view of
the great actual contraction that has taken
place In the currency, and the comparative
contraction constantly going on, due TO the
increase Of population, Increase of manufac-
lures, and all the industries, / do not believe
that there Is too much OF II now Tor the dull
est reriod of the year. Indeed, IL clear
ing-houses should be established, thus fore
ing redemption, it is question for considera-
tion whether banking should not be made free,
retaining all the safe guards now required to
secure bill-holders. In any modification OF the
present laws regulating national banks as a
further step toward the resumption OF specie
payment, invite your attention TO a consider
alton of the propriety of exactipg from them
q retention, as part Of their reserve, either
the whole or part Of the gold interest accru-
ing upon the bonds pledged as security for
their Issue. have not reflected enough on
the bearing this might have Ia producing a
scarcity Of coin with which to pay duties on
imports, 10 give it my positive recommends
ton, but your attention Is invited to the subject
During the last four years the currency has
been contracted directly by the withdrawal of
per cent. certificates composed of interest
notes and 7-30 bonds outstanding on the 4th
of March, 1862 all of which took the place Of
legal-tenders In the bank reserves TO the ex-
tent of sixty-threc millions of dollars. Dur
ing the same period there has been much
larger comparative contraction of the cur
rency. The population of the country has
largely increased; more than 5000 miles Of
railroad have been built, requiring the active
use Of capital to operate them; millions Of
acres of land have been opened to
cultivation, requiring capital to remove
the products; manufactures have multiplied
beyond all precedent In the same period OF