, 1875-02-17

DAVID A. WELLS has published in tue New
York UfraM long letter on "the way to
resume" lie gives his theory the title which
We have used as the caption Of this article.
I1e would have the Secretary of the Treas-
ury "burn at least $500, coo Of greenbacks
every week, or @2G, 600, 0UU year. II this
we're dons the greonback's becoming worth
par in gold would be question simply Of
timo, not fact. Mr.. WEL1s estifnntes that the
ti1ne would be between three and four years,
10 that tho average annual increase In tho
value of tho legal-tonler would bo only
about IL per cent. A debtors loss, thorc-
fore, by such gradual resumption would be,
lie thinks, little moro than nominal Tho
contraction, by making resumption certain,
would give capitalists confidence, aud would
therefore induce them, lo argues, to mako
long loans, which they ARC now SO 10th 10 do.
Contraction, therefore, instead Of diminish
ing tho amount Of money available for use
would rcnlly incrcnso It. Moreover, it would
strengthen legitimate business operations,
because long lonns are usually cm.
pioyed for such operations, while spccu-
lators Ay their thirty and sixty-tlay "kites."
Again, gradual contraction would not injure
the commercial prosperity Of the country.
France cut down its currency by contraction
5000, 600, 900 between October, 1878, and De-
cember, 1874. No bud res1,lta hayo followed,
but, on the contrary, good ones. In fact, rs
was shown the other day, business has thriv-
cd greatly during tho operation. Contrac-
ton under Secretary McCuLLocH caused no
bad results. Congress stopped it in Difference
to foolish outcry that it was going to do
lnrnl. How a1,surdly wrong this outory was
is shown by the fact TINT no aetual con-
traction touk place! It was n mere mt
ter Of bookkeeping Part Of the greonbacks
in the Treasury were transferred on the
books to the reserve from timo to time.
That was nll. The circulation remained the
| sane.
Wo agreo with Mr. WELLS TINT contraction
Of irredeemnble notes is the only road to re-
| sumption, and that it would not, If gradual,
disturb commercial vnlues one whit. But We
do not agree with him that the Secretary of
the Treasury should buy and burn hun q
million Of notes every week. For this would
mike necessary On increased taxation Of
$2G,000,000 o year, which the people
| will not stand, The best method OF
contraction is to Issue 4 per cent
gold-bond, running thirty or forty years,
and allow anybody to fund greenbacks: in
eycn sumo over 800, int. those bonds. Then
let the business take care ct itself. Every
groenback retired in this why should be
" cremated.' This plan, while insuring
gradual withdrawal Of tho greenback notes
to the point whore they would appreciate to
gold valua, would not produce any stringenoy
in the money market, because the per cont
bonds into which they wore converted would
bo used in all large transactions for the pur.
chase OF property or payment Of debta, and
would be always Of tho same value as tie
notes plus the Accumulated interest, and
at tho same time would give stoadinesa
to the outstanding grsenbacks in circulation
as well az to the bank notes. Why is not this
the easiest aud simplest way to work back to
specie basis