The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1874-03-31
THE FINANCIAL POLICY.


Finance'-
To the Hon. JOHN SHERMAN. Chairman OF the FL
nance Committee OF the Senate =
With the returning spring trade does not revive
much and ali the great industries OF the country
are paraly Zed. Distrust OF the future causes the
dlfficuty Men who have money viii not risk IL
in new enterprises while the financial policy of the
government is uncertain,
Congress has been In session nearly four months
and men OF business have not yet discovered what
the financial plan OF the Secretary OF the Treasury
is Alter many years OF profound peace, abundant
haryests general health and vast resources IL
would seem possible to devise a system OF relief
from the disturbed condition OF our finances.
Able Senators m their place. and learned writers
everywhere, have demonstrated that lrredeemabe
and a sS nS' Collars
able only in paper promises, is a fraud.
Under the present system our currency has an
rency OF the commercial world cannot circulate
here at ali; hence when gold came over in large
Quantities last fall orr currency was not eX-
banded; the gold came as mere merchandise like
steel rails or gold watches, and our currency was.
by purchasing the Imported com.
la travelling through the West lately nv atten-
ton was called TO the condition Of the farming in
terests, which are much depres sed aud find with
some surprise that their great aCrlcut ural prod
ncts-beet. pork, lard, corn ana wheat"in n the
aggregate, brought quite as much In gold In Jan
uary 1901 as the same products brought in paper
promises in January, 1873 while all the articles
| In 1873
During the first six months OF 1880 the average
price OF mess pork was si7 80 per barrel In gold:
aud during the lirst three months OF tsel. before
the war. It averaged si1 la GOLD. while the aver
age Tor the same period in 1873 was but sl3 60, ill.,
Lard followed pork and corn was higher during
the gold period OF 1861 than during the same pc,
Rod in 1873 with only paper aloat. Comment is
redeenabe paper and IN three years the farmer
Increasing the legal tender without provision
for redemption is sure to bring disaster upon the
orces su a measres We are y broupn a @t to
| lace with this question, and t requires no pro-
phetc vision to foresee that financial chaos VIII
come before another Presidential election If we
| persist In expanding an irredeemable currency.
It is no rash prediction TO say that the
terry disappointed in the results of their
policy If it prevails; that dlstrust, and not
stocKs viii r eve onv for time and that e great
business interests OF the country will be PROSTATE
and tlnd no considerable number OF capitalists
willing to imperil their money in ENTERPRISES Which
VINO ignore all the experience OF the past and
fancy that capital can be created by legislative
enactments, may perhaps, cling to their decisions
until the hood comes and sweeps them away.
We want currency which is perfectly sale and
sufficient in amount to meet ali the REQUIREMENTS
OF legitimate business.
grades without a Jolt upon the way. and with M
calculable advantage to the whole country
First-Funu the legal tender notes in the follow
| Limiting the greenbacks to $780, 600, 900, issue
$4o0, 100000 in five per cent gold bonds at thirty
years free OF taxes and alter thirty years payable
as the government may call them in. Authorize
the Secretary OF the treasury to sell these bonds
to the highest bidder, not below par, payable in
ceived, and exchanging the gold, II any is paid,
with the national banks for gTeenbacks, PRO rata,
oer or sale no more than $4,000 900 in any one
the amount, not exceeding SIC, 200 600 month, to
the discretion of the Secretary.
SeCOnd-At the end OF Jwenty-four months, II the
greenbacks are not all funded let the Secretary
sell TO the highest bidder in gold, not below par,
any bonds remaining o. the $4oo 600 issue ana
them.
Thard-Allow the national banks, or any
new organizations who will deposit with
the Treasury 100000, Or any greater
amount of the new tnrty-year bonds, or Of
ceive national currency within ten per cent OF the
! face of the bonds-the currency to be redeemable
| in greenbacKs or gold government bonds at
! their lace-under such rules as the Congress- may
prescribe.
Fourth-Impose the same burdens and give the
privileges to the new to the Old banks, and
require no reserve to be held by either. exccp III
redemption Of the currency.
! government coupons Qess the dlscounp having
not more than SIX months to run.
inc tnirty-year ponas Woua iorshWith rise ABOVE
par in gold, and as the greenbacKs could gradually
be converted into these bonds the greenbacks
| would soon equal gold.
The sale OF the bonds to the highest bidder would
prevent all Partially In the sale, and in less than
| twenty -four months the greenbacks would all be
absorbed aud the national currency substituted IN
their place. and before that time the credit of the
government would be such that 1t could convert
the six per cent bond into thlrty-year bond at
less than five per cent interest. The interest PAID
on the bonds used IN funding the greenbacks would
be saved thrice over IN this cheaper mode
| OF administering the finances, avoiding
the cost or premium and interest on
accumulated gold, and giving Improved credit and
prosperity TO the country AS the government
would have no greenoacks to redeem and no coin
to pay except Tor the coupons not received Tor GUS
toms, 1t would require no large hoard OF useless
gold, losing interest ana distracted from the needs
OF commerce to lie IDLE In the Treasury, but the
gold would pass to the banks for actual and leglti-
mate use. The government would then be confined
to its proper functions and leave the banks to take
| care OF their circulating notes or be wound up.
Thus banking would be entirely Tree; just 80
much currency would be Kept out as the wants or
the country might require and no more. The
amount allowed 10 be Issued would be very large.