The Abbeville press and banner. [volume] (Abbeville, S.C.) 1869-1924, 1875-09-29
THE CURRENCY QUESTION.

THE CURRENCY QUESTION.
The question Of the currency, forms a
prominent feature of the platforms
adopted by the late conventions of Ohio,
|Rennsylvania and New York, and is
|@e chief subject of discussion in the
speeches and letters, Of all the leading
statesmen. The opposition to, the pres
ent National Bank system seems to be
growing in public favor, and meets a
jealous champion in Ex-Governor
Brown, of Georgia, whose views are ex-
pressed in a recent letter. He thinks
that there is no more reason that the
Government should farm out its paper
money. than that it should grant to any
private corporation the issue of its gold
and silver from the mint. The conse-
quences would be equally disastrous In
giving to favored class the power to
control prices and to create at pleasure q
money panic. He urges the establish
ment Of legal tenders convertible into
government bonds, bearing low rate
Of interest, as currency, possessing
the necessary fexibility, and power Of
adapting itself to the necessities s of Of
some of the most prominent of our
statesmen and seem to address them
selves to the sober business view of
practical men. Governor Brown says
in explanation and support Of this pro-
position as, follows:
fssThe proposition. that meets with
most favor In this behalf, is that the
national government, at the time of
substituting its legal tenders for the
present national bank currency, shall
provide a bond in denominations Of 500
and upwards, convertible on demand
into currency or gold, at the option of
the treasury, and bearing 3.65 per cent.
interest, payable semi-annually at any
sub-treasury in the United States. AS
this is about the average value of money
in all other countries, such rate would
place our own country on level with
that of foreign nations. It is also about
the rate paid by banks themselves upon
deposits. The creation of such an in
terconvertible bond would at once place
it within the power of the business
wants of the community to control d.
rectly the volume of currency, calling
it forth in time of necessity by conver-
ting the 3.65 bonds in such amount and
such localities as required 1t, or return
ing the currency back for reconversion
where its overabundance caused it to
lie idle. And why should not our busi-
ness wants be the measure of our cur
rency? The most potent assertion
made even by those who approve of the
present system of bank issues and de-
fend the late policy of contraction, is
that the amount of circulation equals
the wants of business. If that be sound
argument, why is it not equally sound
in practice? And who can best deter
mine what those wants are but the busi-
ness community itself The process
under this plan of adapting the curren-
cy to the necessity would be simple, i'm
mediate, inexpensive. Under any 9TH
er, either an act of congress, policy at
the treasury department, or the creation
of new banks, 1t must be intricate, pro-
tracted, costly. It would certainly, also,
be dictated by the banks, not by the
business of the country. Would that
he fair? Has not similar dictation pros
trated all our large industries already
Will not any manipulation of the vol
ume of currency other than the direct
demands of trade acting upon Its own
impulse necessarily Involve fatal de-
rangements? The variation of that
demand in the United States at different
seasons of the year is perhaps, greater
than in any other country, so that elas-
ticity must be easy to be effective. A
fixed volume of currency, on the other
hand, increases the danger of crisis,
as was sufficiently shown in 1874, when
the banks violated even their own char
ters in order to lock up the currency,
pending O clamor for the Issue OF the
S44, ,OOO, 900 held in the treasury.
1t has beon asked, how can such
3.65 interconvertible bond be put forth
by the government, and what Is to pre-
vent its return en- masse for reconVer-
sion? There will not be much Difficult
ty, apprehend, in such issuing, as 1t
will at once offer most secure invest
ment for that large amount of idle cap
italwhich refuses to trust the keeping OF
ordinary fiscal agencies. The secretary
of the treasury, can also be instructed, !,
under suitable regulation, to use them
in purchase of other bonds, or of gold,
to call in other bonds, just as the re-
funding of per cents with S per cents
is now transpiring. AS the rate of in
terest is about as high as that generally
paid on deposits, as the security of the
nation is far more acceptable than that
Of any individual can be, as the ability
to convert into money will be instant
and constant, a 3.65 bond will speedily
attract to the treasury large share OF
deposits held by private brokers, saving
institutions, and even the banks them
selves. This will soon aggregate to
hundreds of millions Of dollars, requir-
ing only very moderate reserve to be
set apart by the government for current
conversions. Thus almost the entire
issue called for will be available for still
further reductions of the bonded debt.
There ia no reason to apprehend any
excessive call for conversion at any time
beyond anticipated business needs.
The value of such safe depository OF
the surplus wealth of the masses of the
people would, in itself, be incalculable,
both as engendering habits of greater
economy and dissipating an apprehen-
sion which has been the cause Of many
moneyed convulsions heretofore.
There would, perhaps, be required other
legislative restrictions and provisions
for q successful substitution of a nation
al bank currency, but they are minor
matters Of detail, to which, we may as
sumo, congressional wisdom would find
itself equal. 1t would seem, therefore,
as if the line of duty was both the line
of economy and safety for the govern
ment, and if it does not speedily re-
sumo it's appropriate prerogative Of is
suing money, it will only afford addi-
tional evidence of the sinister control
exercised over it's councils by the pres
ent banking monopoly.