The New York herald., 1875-12-08


less than the merchant, bondholder and banker Tho
present unequal and fuctuating currency oprrosses
and Injuries aborers and producers, who constitute
great majority Of people, far than 1t Affects
inIuriousy dealers in money. Tho difference between
god ana our paper currency is margin upon which
experienced money dealers do business and il is this
that gives the opportunity Tor artificial combinations
whereby values are increased reduced pleasure
me purchasing power OF the currency IS increased or
diminished by the nanipuations OF large operators
united for that purpose, and producers and laborors
! OF resistance Restoration of sound and
unvaryng currency must bring better relative wages
with more constant employment because the value Of
labor OF that which produces will be measured by
more certain standard; and, with the return OF con
ndence, there must come activity, prosperity larger
markets, and greater demand, which, as both
and experience prove, do not tend TO lower wages
! make employment less certain.
The claim that the large issue OF nconvertible paper
currency has been beneficial to producers Is perhaps
sufficiently dsproved by reference to tho reports Of
and pork before and since the issue of such
rency The most sworthy statistics show that such
articles were sold in New York during the five years
from 1870 1874 inclusive, for about the same price
that they brought in the i've years from 1856 to 1860
/ inclusive.
| On the other hand it is equally certain that tho
farmer has paid increased prices during the period
from 1870 to 1874 for articles imported for consumption
upon ali which the difference between gold and
rency must be paid by the consumer, who pays in the
latter Thus the producer OF domestic articles is
santy subjected to loss III exchanging his products for
such articles coffee tea sugars and other imported
goods which enter into daily consumption III this
connection IL should he borne in mind that greater
volume OF currency is required for the transaction OF
business when it consists OF nconyertbe paper which
\ does not circulate abroad than when the
rency in general is gold, which hows
| through every artery OF commerce. The stas-
4 tics of our foreign trade illustrate this PROPOSE
4 ton. For every imported article the must
pay 10 the importer besides the cost in god increased
by his percentage OF profit as much more as the differ
ence between gold and the currency with which pay
ment is made. This difference, commonly called tho
premium gold increases by many millions the total
amount which would otherwise be required 10 complete
| all such transactions.
The proper ofncc of currency, whether be gold or
paper is to serve medium oi exchange for the ad-
justmcnt OF transactions between buyers and sellers
When II is sound and STABLE receivable in all parts of
/ the commercial world, the amount which actually
passes from hand to hand in business transactions is
far be.ow the volume of business. small per cent
thereof is adjusted BY the actual handling of
4 money. Exchanges are, for the most part,
made by transfers Of credits through banks
i and other agencies. Wherever exchanges and
business transactions conducted on the basis OF
COIN and paper convertible INTO it, the volume will be
regulated by natural Money, like merchandise,
will go where there is demand Tor and where
/ thing OF value be obtained III exchange for It,
When the financial panic of 1857 created demand for
! gold in this country a ready and continued supply
steadily IRON abroad the necessities OF
1 our people, and brought speedy relief Now the on
forced use of inconvertbe paper currency not only
! obstructs the flow OF gold from abroad, but drives
from the country the precious metals yielded by our
mines.
thing like equal proportions in country having
mercia relations with other Powers and peoples The
latter will drive away the former. Gold and silver
will flow steadily TO those parts of tho commercial
\ world where business is done on tho basis
Il OF unvarying standard OF values, and
where every issue OF paper is convertible into the pre-
cous metals at the option of the holder because they
are needed there Such is the inevitable operation OF
the law OF supply and demand and the present. linn
tied and inadequate supply OF this country
chiefly due TO this cause Gold has become COM
modify OF trade the price of which from day day de-
pcnds largely upon the Will OF these who have combined
TO control tho market This presents 4 serious obstruc-
ton to all productive industries and commerce. and in
troduces into business transactions clement
tainty which often unsetcs tho most intelligent cal
culations, and tends to destroy confidence, with
mt yh 10 thnFn hn M rpnl narn
pery Apparent, but fictitious prosperity has often
followed large issues of rrcdcemable paper currency,
but result Is more certain to flow from given
cause than disaster and financial distress to follow
period OF imitation Of business and credit caused by
excessive issues OF paper currency. The philosophy
which teaches by example, as well as the deductions
OF reason establishes conclusivtly that there is
effective remedy for tho evil but tho removal OF its
cause
The circumstances attending the issue Of the United
States notes now III circulation impose upon tAasgoy-
ernInent q peculiar obligation to provide for their
| speedy and certain redemption in coin. They
issued in the exercise OF power which be called
into only in time of supreme necessity, and
paid out for the support Of an army composed of brave
and patriotic citizens who had responded to the call of
their country in the hour OF its extremc peril To
suffer promise made at such a time and under such
circumstances to be dshonored by subsequent indf
ference or non-perormance would be little better than
open reputation, and would affect injuriously our
national name and credit.
1t is worthy that for the most part those who
now oppose the redemption OF legal tender notes and
who ask for further issue and continued and indefinite
reissue OF the nocs in circulation most strcnu
in their opposition to such issues during the civil
The acts authorizing such issues were denounced
in violation OF sound principles of finance and not
warranted by the constitution. Their constitutional
validity resisted at every point and subjected to
the or judicial decision almost every court in
the country both State and national, The suprems
judicial tribunal OF the nation upneld the acts as
OF necessity at time of great cxgency but
it has neither decided inimated that such power
may be exercised by Congress IN time OF public tran
qulhty. Indeed II IS fairly nferrible, from all tho
Court has said in the various IN which the
question has been before 1t, that the issue OF
such notes in time Of peace Is not within the consttu
tonal power Of Congress The language and argument
OF the Court leave to believe that ii would
ain the claim OF power TO increase the volume of
such to reissue such have been redeemed in
obedience TO law, when the public xgency longer
exists. Those who opposed such issues at time of
supreme necessity, and insist upon further issues
when the emergency has passed away put themselves
in the attitude Of opposing war measures in the midst
of war; and advocating them In time Of profound
peace Congress carefully confined the operation of the
act TO the period Of necessity by authorizing "the
issue from time to time, the exgcnccs OF the public
interests shall require
The government is bound not only oy economic con.
sderaons and proper regard for the interest of the
people, but by express and repeated promises TO pro-
VIDE for the redemption in coin of all It's issues Of legal
tender notes The original Legal Tender net
garded and treated at the time OF its adoption tenn
pprary measure madc necessary and jusable only by
inc cxgency OF war, which taxed all the and
energies OF the nation. The first act author
izing such issue February 25, 1861 is en-
7 titled "An act to authorize the issue of
funding thereof and for funding the floating debt Of tho
Uuitod States language that significantly expresses
tue views of the Congress by which it was passed. II
authorized the Of $3.50 900 legal tender notes.
and made provision Tor funding them in bonds
Issued the credit OF the government, bear
4 Ing interest in gold and payable at future
day This the best the government could do in the
midst of its struggle for existence and rightfu
premacy The state Of the public credit did not admit
the possibility of the immediate procurement Of a suf
ncient amount of coin to redeem the notes absolutely.
/ well settled principle of political economy forbade
the issue of paper currency without providing for its
redemption and in obedience thereto Congress made
the Only practicable provision for the redemption Of
the which il authorized to- be issued and stamped
with the quality Of legal tender The of July IL,
1902 which authorized further issue OF $3.50 600 600
contained like provision, and further provided that
any notes issued hereunder might be paid in coin,
instead Of being converted into bonds, at tho
discretion Of the Secretary OF the Treas
ury Tho notes thus authorized issued
and accepted by the people upon tho assurance that
they had the right TO fund them IN gold bearing bonds
OF the United States and this consideration undoubt
edy constituted important element of their value
and gave them quality In aid OF their circulation and