The daily gazette., 1874-12-29
THE SUBSTITUTION POLICY.

H NJ - ~ Ell
We know of no way in which all this |
can be accomplished except by substi-
tuting interest-bearipg notes for the
present Treasury issues, payable at q
future time, and bearing such rate of
interest as will insure their being gra
dually boarded by those who have no
special occasion to use them as money.
BY this arrangement the entire green
back circulation might be withdrawn,
and the new notes, convertible, say In
1.-TWO years, into Government ten-fOrty
five per cents, like those issued under
act Sd March, 1868, would take their
lplaces. Experience has already shown
the popular character of these notes
bearing per cant, compound interest
and the rapidity with which they we're
laid by for investment. There would
be no doubt of the success of the mea-
sure, nor of the final result 30 gradu-
al would be the withdrawal, If limited
as just mentioned, that not ripple
would be perciptible in business affairs
yet the work would be accomplished
cffectually, and the present Treasury
notes disposed of in the best possible
way. The new notes, being paid out
for all Government dues. except inter
est upon its bonds, would be scattered
broadcast over the nation, and the
lpeople everywhere have an opportunity
to invest in the public funds, without
lexpense, or the Intervention of third
party, 1t places the whole measure of
Icontraction in the hands of the people,
who can make just sach use of the in
terest-bearing notes as they see fit. If
laid by for investment it would be be.
tcause not wanted as money; and yet,
should any extraordinary pressure arise
creating high rate of interest, the
lnotes, as they must, according to the
Iproposition that has been made, re-
main two years in the hands of the
public before being convertible, would
be brought at once into circulation, on
account of the higher rate of interest
they would command, and thus all dam
ger of panic in consequence of the
hoarding of these notes would be ef-
fectually prevented. The new issues
(which would not be allowed as a part
of the bank reserves) might be discon-
ltinued whenever the whole monetary
Icirculation had become at par with
coin, as it certainly would be, when
ever it had been reduced to its normal
Iamount.
Substitution Is simply permission for
the people to restore the currency by
their own action, in their own way and
their own time. There is nothing com.
Ipulsory about it; not Il dollar of circu.
lation is taken away. 1t is voluntarily
surrendered by those who hold it, be.
cause no longer needed as money. This
fact brings the entire movement under
the operation and influence Of the law
of trade.
Can anyplan for restoring specie pay.
ments be found more simple, gradual,
tcertain, inexpensive, convenient, cal
lculable, and effective than this ? Can
la single valid objection be urged
against it Need there be any large
Iprevious accumulation of specie, any
j Irepeal of the legal-tender act, any par
ticular day for resumption established
lby law ? Does not the whole matter
ladjust itself without difficulty or in.
convenience, by the mere sub titution
of interest bearing, ,notesconvertlpi. in
to bonds, in place of the present Trea-
!, sury issues
i In closing this criticism upon the
plan Tor resumtion submittCu by the
Secetary of the Treasury,I cannot but
exSpress my high appreciation II of the
admirable manner in which he has
thus far conducted the affairs of the
} oIdepartment over which he presides.
: The energy, fidelity, and fearlessness
already displayed in the discharge Of
his official duties give to the people Of
the United States ample assurance OF
such an administration of their fnan-
cial affairs as cannot fail to increase
e the national credit abroad and at home
S and impart powerful impulse to the
{ industry and commerce of the country.
IL AMAsA WALLER.
L North Brookfield, December IA, 1874