The workingman's advocate. [volume] (Chicago [Ill.]) 1864-1877, 1875-07-31
To the Editor of the ArcadiAn:
FINANCE.


Perhaps the most noticeable event Of the
last month'has been the action Of the De
mocracy in their State Convention in Ohio,
upon the question of the currency. Their
resolutions recognize the fact that nation
al stable constitutional currency Of equable
value may be made out Of the precious
metals. To this it has been objected that
such currency is not consistent with the
true Democratic principles Of Andrew
Jackson. This is a mistake The contest
OF Jackson with the banks was founded
upon the idea that it was the duty of the
| government to issue a constitutional cur
rency for the people, not to be controlled
OF regulated by banks. In the then state
Of the country, gold and silver were the
only materials used as currency open to
him, and jackson adopted those as the in
struments with which to carry on his war
with the mOnopolles. The materials to be
stamped with the government value, how
ever, were but the incident to his funda-
mental idea that it was the duty of the
government to provide the people with a
national currency.
Our large public debt now provides the
means OF giving value without expense 70
the government (but on the contrary, with
greater saving of interest) to a constitu-
tional currency tor the use Of the people
without using the precious metals, and
thus decapitalizing great amounts Of value
to do work better done by an inexpensive
material
The bankers idea heretofore has been
that the only stability in value to a cur
rency must come from being redeemable in
gold and silver. But how shall the value
of the gold and silver be made stable which
have now become merchandise and prime
articles of annual product of this and other
countriesl A note of the Bank of England
has value given it by being redeemable in
gold an amount substantially equal to
which is kept in the vaults Of the bank for
that purpose. But upon trial Of this sys-
TEN the question at once presented itself to
the Bank Of England. how shall we regu-
late the value Of gold 80 as to retain the
same in our vaults The only means that
presented themselves to } that was to vary
the rate Of interest on discounts according
to the demand for gold The consequences
has been that no more unstable currency
III value for business purposes than the
English was ever known. The rate Of dis
count at the Bank of England may be one
day 2 per cent, and as gold is called for it
is raised, to prevent the outflow, 3. 4, ).
and q, and sometimes as high as Z, 3, or .
per cent, thus doubling, trebling, and
quadrupling the rate of interest paid by
the business of England, causing most
widespread ruin and destruction to her
merchants and manufacturers Finally, to
save tie bank on four several occasions
within thirty years, this rushing the rate
has eliminated from necessity, without
warrant Of law, in making England's bank
notes redeemable in specie, thus absolutely
multiplying and overturning the whole the
ory Of the English banking system.
At the present hour there is no more ex-
tensive commercial ruin than that which
the business Of England is now undergo
ing We, with our paper money system.
have had nothing like it, whether in
amount or extent.
The central idea of those who insist upon
"greenback currency" is that it shall be
made convertible and recoverable into a
government bond at low rate of interest.
At a little more than 3 per cent. interest
the average gold dollar of the world is at
present invested. Now, if we make our
greenbacks convertible at the pleasure of
the holder into gold bearing bond at 3 90
per cent. interest, our dollar is equal in
value for investments to the gold dollar of
the world, and the amount of currency
used in the country will at once regulate
itself by the only sure law, that Of supply
and demand. 1t is said, in answer to this,
! that the country needs no more currency
because the circulation Of the banks is be-
ing diminished, and at the money centers
money can be had on call for from 2 to 3
| per cent. That is true ii the borrower has
certain kinds Of collateral security, to-wit:
government bonds to pledge for his loan !;
but for any length of time, upon any other
security, money cannot be had at any rate
at which business enterprise can be carried
on. 1t is obvious that the reason WHY
money is so plenty now is that nobody
| wants it.
BY a policy which seems almost to border
on insanity we have entered upon con-
traction of values with view, in certain
limited space of time, to enforce "specie
payments, as they are called, but which
every one who remembers the state of
things before the war knows to be delu-
sion and snare. Therefore, houses, lands,
manufactures, ships, goods, produce, and
labor have all, within two years, been de-
preciated from % to SO per cent, until all
business is crippled, all enterprise stopped,
and to-day more than a million Of men and
women who are willing to work are without
employment in the United States. of
course, while this policy Of contraction con
tinues, no man will begin any new enter
prise or make any new production who is
not obliged SO to do by the necessities Of
his business relations. Who desires to
build ship or mandatory when he knows
that before it is completed it may depreci-
ate 20 per cent?
A certain class of men are loudly crying
out that this depreciation is necessary in
order to bring down values of all property
to a specie basis However hurtful this
operation may be to the individual, how
ever detrimental to the national industry,
yet it might be tolerable if all the values
were brought down but the fact is-and
this may account for the outcry of the class
to which we have alluded-that only two
thirds Of the property in the country is be-
/ ing deprecated to quite SO per cent. in its
/ value, while another third at least is being
appreciated at least ten per cent. There
| ia at least one-third Of the wealth of the
country invested in Indictment, national,
municipal, or otherwise. All this appre-
ciates. All other property depreciates.
! To illustrate : A mans house mas within
the last two years deprecated thirty three
Der cent. in its exchangeable value, that is,
he can sell 1t for that sum only as COM
pared with two years ago but the mort
gage for greenbacks borrowed upon it has
appreciated ten per cent. in comparison
with gold. The property grows continu-
| ally smaller, while the bond and mortgage
grows continually larger. So with all
property and all debts. And the business
man sees all his property and hopes swept
away in favor of the money-lender. How
long the business portion of the country
| will submit to this for the benefit of those
who hold bonds, notes, and mortgages is q
/ question that must be solved apparently by
| tha namncrafic marty and unnn this m 0s.