The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1874-03-27
Playing with Fire.


Playing with Fire.
The action of the House of Representatives
increasing the legal tender issue forty-four
millions of dollars, is full of peril to the well
fare of the country. If it should be ratified
by the Senate and sanctioned by the Ex-
ecutive, we shall have lost in single session,
what it cost years of judicious financial admin
istration TO gain. The duty of gradual
contraction of this vicious currency, was
universally recognized at the close of the war,
and Mr.. McUulloch faithfully pursued this
sensible policy with gratifying results. By
regular system of curtailment he succeeded
in reducing the amount of these promises
from $500, 900, 900 to S356,000,0o0. At this
point popular clamor interfered aud fur
ther reduction was prohibited by Congression-
al enactment. Nor was this all. Congress
refused to declare the legal tenders that had
been withdrawn cancelled. Thus the right to
reissue them was vested in the Secretary of
the Treasury. 1t was however never ex-
ercised, except in one instance during mo-
notary pinch il the autumn of 1872 when
Mr.. Boutwell, let loose $4,9O0,0OO, with the
avowed purpose of replacing it in a few days
from his then abundant incoming revenue
receipts. It was so replaced, not a, soon in
deed, as Mr.. Boutwell, had anticipated, so
much easier is it to pay money out than to
recover 1t back. But in few months the
maximum of outstanding treasury notes was
again fixed at 1856, 100000 at which point
it stood undisturbed until the panic of 1873.
Everybody remembers the importantly with
which the President and Mr.. Richardson
were besought to release this reserve and the
inhexibility with which they persisted in re-
fusing. l..
Had Mr.. McCulloch's example been imi-
tated by his successors, we should probably
have reached specie basis by this time.
But unfortunately, with the stoppage of con-
traction came reduction of taxes, and trade,
under the influence of artificial stimulants, as-
sumed an unhealthy activity. Prices were
forced by speculative processes up to
point which after time rendered the
currency inadequate to the business it had
helped to nourish. Of course this caused a
panic, and we were driven to the alter
native of measuring the property of the
country by an accurate standard Or maintain
ing fictitious valuations by further diution of
the medium of exchange. We had fattered
ourselves that the matter was practically dis
posed of by the decision Of the President and
Secretary. Many ingenious reasons were given
why they should yield to the pressure. It
was urged that the country had outgrown its
currency-that there was not money A.eugn
in circulation to effect .. fee interchanso oi
ee.-usourJres. This proved to be dntrue. Inc
want of that crisis w~s~r1ot counters but
confidence LA few weeks there accumu-
lat.a such surplus of unemployed funds in
the Metropolitan banks that the rate of inter-
est fell two or three points below the legal
standard. This plethora was of course due in
some degree to the gradual outlet of the
Treasury reserve to meet the exigency of the
public service, the regular income of the gov
eminent having been seriously impaired by
arrangement of commercial affairs compelling
it to trench upon this reserve. But there
would have been money enough and to spare,
even if the forty-four millions had remained
intact. 1t is great deal better for the mass
Is, that the necessaries of life should decline
10 minimum within the purchasing power
OF the existing volume OF paper, than that the
issues of that questionable solvent should be
swollen so as to enhance the cost of every
thing the people consume. The tendency of
debased currency is to benefit the few at
the expense of the many. The effect of the
addition of $44,000,000 to the greenback cir
unequal tax upon the labor of the country.
The victims may not be aware of this. Prob
ably they are not. No section of country, for
example, will reap such harvest of disaster
from vitiated currency as the West. And
yet in that quarter the delusion is most de-
ploraby prevalent-that the true panacea for
the temporary stagnation of business, which
the financial uncertainties OF the hour have
occasioned, is an increase of irredeemable
promises to pay. 1t is the province of wise
craftsmanship to combat this egregious falla-
cy, not to humor it. aa
The time is opportune for initiating f.
1ancial policy which shall tend to ear
ly resumption. We have already retraced so
many Of the steps that were leading us in the
wrong direction that a little more courage
and patience will bring us to the shining goal.
The volume of unliquidated debt is smaller
than it he, boon Con se-e.sI y&.---, A.-1 laas
than it ever will be again, until it is once
more diminished by the great sponge of bank
ruptcy. To initiate the currency now, be it
ever so little, is to invite that still more ruin
Gus expansion of individual liabilities into
which trading people are so easily tempted,
and out of which SO few escape safely.
Much as we appreciate the Importance of a
speedy settlement of this vexed question, we
should prefer delay TO an erroneous conclu-
sion. The one may occasion temporary in
the other will entail permanent
disaster. We are not without hope that the
Senate, moved by the gravity of the issues in
volved, and guided by the light which history
and political economy have shed on this great
SUBJECT VIII rescue the nation from the evils
"nicn threaten its monetary affairs, by de-
termlnlng that not another dollar of ire
deemable notes shall be legalized, that the
twenty-six millions recently put out shall he
recalled, and that there shall no
q steady contraction of legal tenders until
they become the equivalent of the only real
money the world accepts. We have resorted
to palliatives and expedients too long. The
honor, dignity and good faith of the nation
demand that the public credit should he re-
established on sure foundations. 1t is an 81
front to the patriotism of every Ar,erican
citizen 20 assume, that a people who gave
their treasure and their lives to preserve the
Republic, will not cheerfully undergo present
sacrifices if need be, for the sake of securing
such legislation as is needed now to prepare
Ihe way for a restoration of our financial sys-
tenn to its normal vigor and healthfulness.
~ LOOKS now as if the Massachusetts, Leg
.s'a.ure VIII not be able to choose successor
~ onarles Sumner at very early day. There