The workingman's advocate. [volume] (Chicago [Ill.]) 1864-1877, 1875-12-25

: uons ~ one million hve hundred Thousand
. quarters Of wheat, to supply the defcien
cies of bad harvest in 1910, had occa
stoned so great a dearth of specie ia Grea
Britain in the latter year, that gold anc
, silver had almost disappeared from tn,
circulation; and light guinea was worth
twenty five, and sometimes twenty sever
shillings. But what then The Bank,
increased their issue in a similar proper
tlon; that Of the Bank Of England va.
raised TO twenty eight millions; its dis
. counts reached twenty millions in a single
year. All other banks did the same; and
by this means. not only was the crisis sur
mounted without difficulty, but hundred
thousand combatants and forty ships Of
the line were assembled around Lisbon.
which hurled back the French from the
lines Of Torres Nedras A commercial
and monetary crisis which, beyond all ques-
tion under our present system. would have
involved the nation and all the commercial
interests ia a general public and private
bankruptcy, was not only surmounted
without distress, but the property " the
industrious classes was unlmpaired during
its whole continuance; and the nation com
menced in the middle Of it, those gigantic
against France, and brought the contest to
a glorious termination. 1t is remarkable
that this admirable system which NAV be
| truly called the moving power Of the ma
tion during the war became towards its
close, the object Of the most determined
hostility on the part of the great capital
lists and chief writers on political economy
I II the country. Here, however, as every
where else, experience, the great test Of
truth, has determined the question. The
adoption Of the opposite system Of contract
ing the paper in proportion to the abstrac-
ton OF the metallic currency, by the acts
of 1919 and 1874, followed as it was ne
cessarily BY tn monetary crises Of 1925.
/ 1889 and 1847, has demonstrated beyond
| a doubt that it was in the system of an
expansive currency that Great Britain.
during the war, found the sole means VI
I its salvation ~ lison's History If En-
rope, rol re. p. 1g 80.
| And, moreover, the fact that, from 1897
| TO 1915, commerce, manufactures and
agriculture advanced Gin spite Of all the
evils Of war; with a rapidity greater than
they had previously done in centuries,
proves still further the power of paper
money to increase the wealth Of ma
ton.
Remarkable and beneficial, however, AZ
were the effects produced III our own coun-
try, We have recently seen the power of
paper money exemphhed on grander
scale in the United States Of America
At the commencement of the war with
the seeding States Of the South in 1861,
the debt of the United States was about
$50, 900 600. At the conclusion Of the
war in 1868. the debt amounted to 5000
600, 600 sterling.
The Americans speak Of this contest as
''the most costly and tremendous war that
the world has ever known" For some
time they had 500, 600 soldiers III the field.
md the expense Of their army was abolt
f400. 900 day.
One of the immediate effects of this Law
lsh expenditure was to banlsn gold and
SILVER coiu from circulation. Metallic
money was largely exported To pay for
eigners for the munitions of war. But
the Americans never dreamed Of renn-
quishlng their determination to vandulsh
the South because their gold and silver
were exhausted. The nations real wealth,
I the land, the iron, the manufactures, the
mines, and above all the industrious and
]
sued paper money with no sparing hand.
| The paper money was Of all denominations.
\ Greenbacks as low as 3 cents were in cir
cuiation. This currency, based on the
whole wealth Of the nation, ana fDr which
! the faith of the nation was pledged, was
4 tirst mortgage on the land and property
4 Of America. The people readily and glad
I " accepted it. In this money they car
rled on the transactions of trade. 1t was
I the medium with which they bartered
/ their commodities with one another. With
Their commodities they bought this paper
money. and with 1t they paid their taxes
to Government. As IN the early days OF
the Colonies the paper money tended
greatly to develope the resources of the
country. During the four ears Of this great
war I'VE have increased IN numbers, " ealth
and prosperity, says an American writer
Ii was also necessary that with enormous
taxes the prices Of all commodities should
rise The abundant currency issued
by the Government furnish the medium
in which prices could rise; and thus the
producer was enabled to add TO the cost
Of production the fair amount Of taxation
due from the consumer. The Americans
thus emancipated themselves from the
restrictions Of metallic currency. Gold
found its market price On their paper
money! Gold first began To be held at
higher rate than paper IN the latter part
of 1861. and in January 1862 was at a
small premium. In July, 1864, it reached
its highest quoted price, 80 per cent. II
was not only the demand for expectation,
out the speculations Of the bullion dealers
which caused the immense huctuation.
Since the conclusion Of the war its price
has ranged between l40 and 100, and IN
i'll 1860 has been as low as 125. There Ia
no instance on record of the National Cur
rency 81 a country being 80 entirely inde-
pendent Of the precious metals, or Of gold
being restored to its natural place as
commodity. And taking this very extreme
case it must never be forgotten that though
some inconvenience and some loss to indi
viduals has been experienced, the nations
prosperity has never been checked.
The statement made by the President a.
the opening Of Congress, on December 3rd
1866 is the most complete demonstration
of the power which Paper Money possess
es to increase the Wealth of Nation tina
has ever been submitted to the world.
"The report Of the Secretary Of tn,
, Treasury presents much more satisfactor.
condition OF our finances than one year az,
the most sanguine could have anticipated
, During the fiscal year ending the Both D
! June, 1860, the last year of the war, tn
public debt was increased $94l, 902, ,537
and on the 3lst of October, 1860
amounted TO $2, 740, S54 $50 On the 3ls
day Of October, 1866, il had been reduces
to S2, sol $40, or, the diminution durin,
period Of fourteen months, commecini
September |, 1865, and ending Octobe
81, 1866, having been s206, ,379, 300 Ii
the last annual report on the state Of tn
finances it was estimated that during tn
three quarters Of the fiscal year ending tn
Both Of June last the debt would be in
creased S112. 194, 947. During that period
, however. il was reduced $31 1876 387, tn