New-York tribune., 1874-09-14
PAYING THE BONDS IN GREENBAcKs.

OPINIONS or JOHN STUART MILL ON A SIMILAR
QUESTION AGITArED IN ENGLAND FIFTY YEARS
AGO.
From MUS Of Political Eco>omy'
In England for many years subsequent to
1919 (the year which the passed which
payment Of its notes in coin resumed by the Bans
Of England in 1s2 1t pernaciousy ooDtended that
large portion OF the National Debt and multitude OF
private debts still in existence contracted between
1877 and 1919, when the Bank OF England exempted
from giving cash for its notes; and that grossly
unjust to borrowers that s in the OF the National
Debt to al tax-payers) that they should De paying
interest the nominal in a currency OF full
value, which borrowed In deprecated one. Tie
depreciation according the views and objects OF the
particular writer represented TO have averaged 30,
So or more than so per cent. and the conclusion
that either ought to return this deprecated
currency strike off from the National Debt, and
from mortgages other private debts Of old standing,
percentage corresponding " the estimated amount OF
the depreciation.
10 this doctrine the following the answer usually
made. Granting that, by returning 70 cash payments
without lowering the standard weight OF the coin an
injustice done Debtors in holding them liable for
which they had borrowed while II deprecated 10
Is now too late TO make reparaton Tor nr INJURY Tue
debtors and creditors OF to-day not the debtors and
creditors OF I19 the lapse or years has entirely altered
the pecuniary relations OF the community ana being
injured. to attempt TO rerrace
steps would be redressing wrong but super
already committed. This argument certainly conclu.
the practical questions but It places the honest
cedes that the of ls19 called PeePs bill, by
ah easa 81 1 % were az as @ o u ma
conn., really the injustice 10 sald to be- This Ia
an sdmisson wkslly opposed to the truth Parliament
had alternative 10 absolutely bound TO adners
To the acknowledged standard; as may be SHOWN on
three distinct grounds two OF fact and OF principle
l. The Of fact these In the first place. is
is not that the debts private public, incurred
during the Bank restriction contracted in cur
rency Of lower value than that in which the interest
paid 1t is indeed true that the suspension of the
obligation to pay specie did put it in the power OF
the Bank depreciate the currency It s true also
that the Bank really exercised that power though TO
far less extent than is often pretended since the der
mnt valuation t93 IFS. lOtf per ouncel during the
and whsn gaf' I, was 1 erestest during the lass
five years Of the war usli-l5), did not much
fenoe ~ the pee curTency was deprecistedIthat s its
value below t9at OF the standard TO which It pro-
such-there was so unusual an absorption OF the
precious metals, by boarding and 10 the military chests
OF the vast armies which then desolated the continent
that value of the standard itself consider
ably rased and the bes5 authorities among whom t Is
sufficient name Mr. rOOke have, after an elaborate
investigation satisfied themselves that the difference
between paper ani bullion not greater tnan the
though deprecated relatively the then value OF gold
did not sink below the ordinary value at other tines
either OF gold or OF convertible paper this De true
land evidences Of the tact coaeusvey stated Ia
Mr. Tooke's History OF Pces) the foandItlon OF tho
whole case against the fundhOlder and itors
on she ground OF depreciation II subverted.
EQUITABLE ADJUSTMENT nfPRACrIcABLE.
But secondly, even If the currency had really bees
lowered In value at each period OF the BIak restriction,
the degree in which It appreciated In rela
ton its standard must remember that part only
OF the National Debt OF otner permanent engage
mens, was incurred during the Bank restriction. A
large part had been contracted before l9 st larger
during the earlier years OF the restriction, wnen
the difference between paper and gold was yer
small. TO the holders of the former part an
as D9 Years ~ns in oT1e ns those 0
the second suffered an injury durins the years
more deprecated than that in which the ioans were
contracted. To have resumed cash payments at lower
these two classes creditors, IN order to avoid ewing
an undue benefit TO third class, who hal lent their
during the few years OF greatest depreciation
AS 10 is there uuderpaYner 10 one set of per-
sons aud an 0verpayment To another Tie late Mr..
Mlshet took the trouble 10 make au arthmetcal com.
parfsSn between the two amounts. He asrcrtaned by
calculation chat II account mad been ~ it ous "a 1919
OF vi hat the funchoiders Nat gnncd anu ioss 1y the
variation OF the paper currency from ic standiri they
would nave been found as botJ 70 nave oeei losers
depreciation II would not be fran the fundhUiters col
lectiyeiy bu 10 tben.
CONTRACTS MUST BE ENFORCED AND SOLEMN
PLEDGES NOT REGULATED.
g. Thus It Is with the facts oi the Bat these
reasons Of fact are not strongest Taere ID
of principle still more powerful. suppose that not
part Of the Debt merely, but the whole bad been con
tracted depreoiated currency. deprociated not only
in comparison It's standard but with s own value
before and after and that now paving the In
terest NJ this DeOt IN currency NIFTY or even nundred
per valuable tnan that In which II Vas eOn-
tracted. What difference would this make In
tue obl cation OF paying IL II the condition
that it should be paid was part OF the
original compact Now this not oaly The truth, bat
less yhan the truth The compact stipulated better
terms for fundhoder than ne has roeeiv-d. Ddr
oas parliamentary pledge, 6E rhieh LAe Legtsdtur,
much bound Us any Jegtstdharc Is capable %
bndin1 ttsetf hdf cash payments ssstd o. rtsEaed on
Ds original footing df f4rtaest IN six ~on1ts dr ~
coaelnss0n Of 1eaefut peace Ihis therefore al
condition lOan and terms Of the loan
were more favorable IN consideration of IT, Wishodt
such stipulation the Government could not nave
expected borrow unless the on wnleh loads
made 10 the NATIVE princes OF india III y nad ocen
tho standard at wnieh it computed mixht oe Hel
nently Lowered 10 extent which 70 Ine oseeso
wisdom OF Legslatare Of borrowers lsns So soe W & ~
who can gay what Of interest wosIu nav oceu
sufficient induoement persons OF eo,uon reuse 70
rsk their sayiags IN SUCH adventure however much
rhe fndhoIders had gained by the resumption OF cash
no tte aruas eoutraet insured their giving
aimee cash ments wero not Resumed IN six
,-.o,bs hnf iu ss many after the 90 that
All our except the last, and concod
-, ali the facss other side OF the qnos
.sen she instead N being undny benefited,
are tne injured party ana would claim of com
oeosalsou clzims not very pSoperu barred
sy The imposssoiItty Of sdtudeaueo-