The Indiana State sentinel. [volume] (Indianapolis) 1868-1895, 1874-09-08
THE UNSOLVED PROBLEM.
McCULLOCH ON THE CURRENCY.
NATIONAL FINANCE.

LETTER FROM AN Ex SECRETARY OF THE
TREASURY.
The Hon. Hugh McCulloch has addressed
the following letter on the national finances
to gentlemen in Cincinnati who had invited
him to give public expression of his opin-
ions on that subject. The letter as given in
the Cincinnati papers of yesterday is as fol-
lows:
THE CURRENCY.
Nv opinions on the subject of currency are
well known to those who took the trouble to
read my Fort Wayne speech, and my reports as
secretary of t. e treasury from 1865 to 1859. The
opinion There expressed, in language as strong
and unequivocal as l could command, have
neither been changed or modified. On the con-
ened by further observation and reflection.
thought it to be the duty of Congress, consider
ing the subject in its moral as well as its finan-
cisl bearings to adopt its decisive and effective
measures to bring about specie payments, and
that the time for the adoption OF these measures
was at the close of the war. L did not think
that ''the way to prepare to resume specie pay
ments was to resume but did not think it of
vital importance TO tn best interests Of the coun-
try that the restoration of the specie standard
should be the end and aim OF all legisla-
ton bearing upon the subject of the currency.
NV convection was clear and decided that this
could only be effected, within any reasonable
time. and before any such financial disaster as
country, by retiring so much of the paper cur
rtncy in circula ion as would be necessary 10
1g up scn%nIiS5e4 the oceuaSenee
of the apprehended disaster o the business OF
the country, aud without affecting in the ieast
OF the amount of inconvertibIe notes in circula-
ton the purchasing or measuring power of the
remainder would be pr0pOrtiOnately increased,
and that cOnss quenIly the amount of real money
In circulation would not be thereby diminished;
that the measuring of property by false stand
standard, r, duce Ii. There was, II seemed 10
me. but one class in the COMMUNICATIVE debtor
class-who could be benefited by a depre-
siated currency, and I was anxious that de-
eided action for relieving the country OF
such currency should be taken Immediately
.fser the close of The ar when Individual in
debtedness was less than Ii had been for many
years. 1t seemed TO me also that the injury TO
this class from reduction and consequent i'm
provems TT of the currency would be altogether
less than was feared by them; that what honest
and energetic debtors needed was OF legislation
TO enable them to pay their debts In a depr, cl-
ated currency, but legislation that would give
activity to wel-directed, not speculative, enter
prise and stability to business; that as In TACT,
one debt is in the course of trade usually paid
by the creation of another, and the general in
debtedness of the eople is not ordinarily rom
year to year materially reduced, the debtor class
itself was in no serious danger OF being injured
that If debtors were to be Injured by 1t the in
Jury would be small in comparison with that
which has been inflicted upon creditors through
THE LEGAL TENDER ACTS.
which compelled them to receive in satisfaction
of existing contracts a currency of far less value
than that which was the only lawful money at
the time they were made, and who generally
bore their losses without murmuring as a sacri-
fee required by the government N its struggles
with gigantic rebellion. At that time. in Ian
guage which made up by explicitness what Ii
may have lacked In strength, pointed out the
trOvertible and deprecated currency. By every
argument could make, and every illustration l
could bring TO bear upon the subject, l endeav-
ored to prove in each OF my reports that a depre-
oiated currency was, ami never could be any
thing else than a positive, unmistakable injury
to the people, morally aud financially that In re-
gard to such acurrency there could be no stand
still-until the-country grows-up-to-it" policy
that by wise legislation we should move toward
specie payments, or by unwise laws, or by drift
ing without chart or compass, we should find
ourselves upon financial breakers before
We were conscious of Immediate danger.
In my earliest utterances upon the hnancia
question, In a free talk with my Fort Wayne
friends, remarked that while regarded an ex
tensi We metallic curren cy among an enterprising
and commercial people an impracticsble thing, i
regarded an irredeemable paper currency as an
evil which, in extreme circumstances for q sea-
son might render a necessity, but which should
never be sustained as policy that the legal
tender notes were issued as a war measure, and
rs the war had been brought to a successful ter
mination measures should be taken for letiring
these notes altogether, or bringing them up to
the specie standard; that had no faith in pros
perity that was based upon deprecated paper
money, and that saw no safe path to tread but
that which led to specie payments; that the ex-
tremely high prices prevailing in the United
measuring property by a false standard; that the
United States were becoming the best country in
the world for foreigners to sell in and the worst
to buy in; that the longer imitation continued
the more difficult would IL be to get IL back to the
solid grouI of specie payments; that, il Con-
ClS65-6, authorize the funding ofthe legal tender
notes. and the work of duction should be COM
and pradenIy we on sSo1Id reach aut tSe soiS
ground without embarrassment to legitimate
business IL not, we might have brief period
vide spread banRr1ptcy AND dfsasser. sSc IN
were my sentiments then, and such are they
now, The troth Is, gentlemen, and the reit9ra-
ton OF 1t ought not 10 be necessary, gold and
silver are the only standards of value, and as
lions, and are commercial people, we can
adopt no inferior standard without being
greatly the loser by 1t.
SOUND CURRENCY
is the very life-blood of commercial people
None but bankrupt nations-with the exception
Of the United States-keep in circulation an ir-
redeemable paper currency-a currency which
In their cases, tends to produce and perpetuate
the poverty 1t indicates. To the United States
such currency is utterly disreputabIe, since
there is not the slightest necessity for it. That
nation so rich as ours, so grand in its resources
80 vast in its productions-a nation which has
challenged the admiration of the civilized world
oy the rapid reduction of its public debt COM
most expensive that has ever been carried on,
and actually reducing its Indebtedness at the rate
Of nearly a hundred million of dollars
year-that such nation should for so
long a period maintain deprecated circu-
lating medium, made lawful money by statute,
Is to in telligent foreigners inexplicable mys-
terry. The specie standard ought tohave been re-
stored before now, and believe IL would have
had given the Doctrines ennnciated ' from me
treasury department from 1855 to 1859 the hearty
Endorsement 1t has given to similar doctrines
when proclaimed by the president in 1874
II the financial trouble that has come upon
Us, and the consequent prosfration of business
the plentifulness of currency, shall tend to cor
rect the public sentiment N regard to the nature
and offices of money, they viii not be entirely
without compensation. 1t required the sacrifices
OF great war TO uproot slavery; perhaps it re-
qutres the experiences of a great fnanci
disaster to teach the people the danger OF
discardtng the true measures of value
and substituting therefor the uncertain