Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1874-07-15

/ pith of the veto was that the financial bill
was against the inteHrst OF Creditors. and
that there was 4 suihciency Of currency,
because there were about four million not
| taken of the fifty-f1ur million authorized
bv the act of 1870 for banking purposes.
So far from sanctiOning an inCreaSe of cur
Tency, he demanded AN increase Of taxation
to pay Government expenses and provide
surplus of gold in the Treasury t9redeem
the Government currency. The neWspa-
pens and people understood the President
to mean that the four million ''nOt taken"
had not been scaled for" Tbs statement
fell short of the truth, aud was made in the
face of the fact that, there were one hum
dred and twenty-nine applications for
| National Bank charters then on file in the
Office of the Comptroller of the Currency.
Some of these applications had been on file
more than year before the veto Of the
| President.
Hear the proof:
Treasury DEPARTMENT. OFFICE or TIE
COMPTROLLER OF THE CUEEENCT; Washing
! ton, April I6, IS5i.-Sir: In reply Ia your letter
| OF the 18th instant, You are informed that the
| whole amount of he sJi.OOB .OCO authorized by
act Of Congress OF July Il, ls60. remaining to be
1 issued to banking associations l. S4.3l5.52S.
The whole number OF applications ON file
| awaiting action OF Congress II one hundred and
,IoITN JAY KNOX,
Comptroller Of Currency.
Hon. DOM VI. BEIGHT,
| House OF Representatives, Washington.
This letter Of the Comptroller IL subyer-
| Sive of the Presidents veto. Doubtless
other applications for banking privileges
would have been male if they had not
been fOreStalled by the assurance that they
| con not he granted without the action of
/ Congress- The excuse of the Comp
troller for not issuing the balance of the
J fifly-fOur millions cannot avail him; that
| is, that the :: per cent. certificates should
Ice Cancelled in equal amounts 10 the IA
| tional bank notes issued. No fair con-
strIction of the law can make the redemp-
/ ton of the per cent. certificates a limita-
ton upon the issue of the ffly-four mil
lions. Their redemption was only Incl
! dental to the issue of the fifty-four millions,
and was but process for their retirement:
and when they were retired the law was
| imperative to proceed with issue Of the ma
! tiOual currency; and when the fifty-four
millions were exhausted, then il was his
! duty TO haze called in the twenty-five mil
| lions from those States having more than
! iheir proportion, and TO have gwen them 10
! those States having less than their quotas.
But as long as there remained any part of
the tifty-fOur millions uniSSued the Comp
! trOller could not call for the return of the
| twenty-five millions. And here he stuck,
with one set clamOring for more currency
/ and another set secure in the possession Of
! their twenty-five millions excess. at the
| same time furnishing a stumbling-blOck TO
| precipitate the President on his financial
| blunCers.
The people asked for bread and the
| President gave them a stone; they asked
for more currency, and he demands more
| taxation. He proposes to stop the peoples
| complaints Of .'the whips with the scOurge
| Of 1.-The scorpions" After heading off this
mischievOus statement Of the President,
| shall make passing remark upon a cur
rency fallacy.
1t has been argued that because gold is
worth from II to Is per cent. more than
| United States currency, there IS a super
| abundance Of currency. This is not true.
| The value Of money is determined by the
| use which the law may assign TO it, as well
as by its quantity.
We have two legal-tender acts; the coin
| age acts Of 1897 and 1S49, making gold and
silver a legal tender for all purposes, and
the act Of February p, 1862, making
! Treasury notes legal tender for all pur-
! poses except duties on imports and interest
on the public debt.
With these two laws in force no amount
| Of contraction of legal-tender notes will
/ bring them to par value with gold. The
/ contraction may be extended until there
! shall be only two dollars, the one gold, the
other a legal-.ender note, and still the mer-
chant and the Government being compelled
| to have the gold dollar, the one 10 pa. the
| duty, and the other 20 pay the interest,
would give the same premium for the gold
| that is now paid. | feel confident in as
! sorting that if all the money in the United
| States We're converted into gold, il would
not be sufficient 10 float our vast and va
| ried industries, 10 pay our enormous debts
| and taxes, and 10 meet the ever-incrGaSing
| demands Of trade and commerce. In my
former speech on the currency i presented
authentic statistics which would verify this
assertion.
Ia this connection, perhaps it would be
well to bring home 10 the American people
a sober, practical questionable power Of
the Government over its own currency di-
reCtly through its laws, or indirectly
through It's banking operations. The Coy
eminent may control the quantity, regulate
the value, and prescribe the use of its cur
rcncy.
Let us take an example growing ont Of
our recent civil war. In The legal-tender
cases, az Wallace, 541,) Justice Strong
tells us that
The entire amount Of coin in the country. in
ending that in private hands a. well a. ia at in
banking institutions, was insufficient TO supply
the Government three months. Foreign credit
we hal none.
The demand for money was nnmeaSIIra-
bly beyond the supply Of gold. Besides,
gold was too great 4 coward TO mingle in
The robust diversions Of war, but il fed
from the strife. hid itself in vaults, bur
ruwed ia The ground. and sought security
in foreign lands. The Government va,
forced 10 anticipate its resources and "t0
coin its credit" Treasury notes were EN-
plOyed. bat the first ISSUES were defective in
not being made 4 legal tender. Justice
Strong, in the same opinion, says:
It Is historical fact that many persons and
institutions refused 20 receive and pay these
notes The vast body OF men in the
M itIry service was composed Of citizens who
bad lett their farms, their workshops, and their
business, with their families Ia Je provided Tor.
ConIre met the eyigency 10y making
the next ISSUES Of Treasury notes legal ten
ders. The effect was "alvauic 10 the para
| lived industries and magical 10 the army
and navy. Although it has been said that
= lltllbl HAY dlll'Sl Is wei - 10 " III
with paper guns as a paper currency Yet
we know that the whole national machine
~, civil and military, was moved under the
prnpclling power uf legal tender notes
The Government, however, was forced 10
change its unit Of value from the gold dol
lar 10 the legal tender Treasury note, and
to run mp IFS paper obligations to about
81, T00,OOO,OOO. Besides, all money con
tracts and property values were changed,
and were represented by the legal tender
note as the money Of account.
But the war came to an end, and then
came the greatest financial blunder Of the
are. Iproved in former speech that there
was circulating as currency in different Va
rielieS on the 3lSt Of August. 1866. 3, 49,
80. So; aud from that date to the lSt of No
yembcr, 1879, that The Government reduced
HAT amount To- q total available currency
Of Sir:l, ,C1G, making 4 reduction q
81 go, 9O6,SjI. The Government was
seized with a contractionmania and attempt