The workingman's advocate. [volume] (Chicago [Ill.]) 1864-1877, 1875-08-21

the comparative contraction continuOusl,
going on-due TO the increase OF manu-
factories and all the industries do no
believe there is too much of it now for tn
dullest period Of the year"
"a specie basis can not be reached an,
maintained until our exports, exclusive O
geld, pay for our imports, interest du,
abroad and other specie obligations, or 9,
nearly 50 as to leave an appreciable &C
cumulation Of the precious metals in tn,
country"
TO increase our exports, sufficient cur
rency is required to keep all the industries
of the country employed. Without this
national as well as individual bankruptc,
must ensue."
This was General Grants common sens,
view Of the subject three months after tn,
panic On these suggestions Congress
acted. and passed bl.l for the small in
crease OF the currency, against the com
bined opposition of the specie payment
tinanciers. But meanwhile delegations oi
usurers and theorists besieged the Presi
dent, and he surrendered at discretion
He vetoed the bill framed ON his own sug.
gestlons, and in his veto message this cur.
rency which he had lauded as "the best that
has eUer been devised, was denounced as
one Of the "eviIs growing out Of the rebel
lion !" Thenceforth he became merely the
mouth-piece Of the money power.
THE MARCH TO SPECIE PAYMENT BY CON
TRACTION FROM 1865 TO 1873.
To get q full view of the dangers which
threaten us in this march to specie pay
ment, it is necessary to look back to It's
origin and progress. and its past and pres
ent effects ON the business of the country.
1t was begun by Mr. McCunoch in 1865,
at the dictation Of European capitalists
He then had an agent abroad (Mr. Lanier)
negotiating bonds who reported Ia him
that ''the feeling in favor Of the contrac-
ton of currency was universally expressed
as the sole condition on which our credit
abroad could be maintained" ThereupOn
the contraction policy was adopted. Gold
that year after the war averaged about
thlrty-hve per cent. premiDm-Our cur
rency was the largest we ever had-and
the industries of the country in all branches
most prosperous. Ten years have since
passed-the policy Of contraction has been
pursued at the dictation Of the money
class abroad and at hOme-gold is now at
sixteen per cent. premium and rising and
the industries Of the country lie prostrate.
If the peoples interests, instead of the de-
maDds Of bond holders, had controlled our
money policy, the industries of the coun-
try would have been fiourishing, and specie
payment far nearer reached than now
The state of the currency October 81,
1865, may be Judged from the following
table Of notes Of all kinds then outstand-
ing. 1t is from Spalding's Finance History,
page 20l:
arcenbaeks and Fractional Currency q 454OOe. 900
State and National Bank notes.......- 25O, 600 OU0
Five per cent. Legal-tenders. ..-. 5000 COO
Three per cent. certificates Of indebted
Observation-Disclosures. IS 600 900
Temporary certificates es............... W, ,OOO O0O
Seven thirty Treasury notes j. ...... $50 900 Oo0
Compound interest nctes. l7S.O00, 90
sl.ss6. .OOO. 100
The floating war debt had been substan-
italy settled, and the bonded debt was but
81, 162, ,00O, 900, of which nearly all was
held in the United States. The interest
bearing notes were all held at home-they
we're bank reserves, thus iberating non-in-
terest bearing currency. The interest due
on them was paid 81 currency. 1t ebbed
and flowed from the Treasury to the peo-
pie as interest, and from the people back
to the Treasury as taxes. These notes
we're held as investments OF reserves, ex-
cept at times when large transactions, or
more than ordinary business need of money
called them out to perform its office.
They we're the reserve corps Of the cur
rency.
The consequence of having this large
amount Of money and interest-notes held
by the people was that, notwithstanding
we were paying heavier taxes than were
ever before imposed, there was from 1868
to 1866 season Of prosperity and freedom
from personal debt unparalleled in our
history. During the eight years from 1865
to 1873, while the population and business
of the country were growing, large
amount of legal-tenders and nearly every
dollar Of the eleven hundred and ninety
one millions Of Treasury-notes bearing in
terest-which had served as currency, re-
serve and investments by turns-had been
withdrawn, and the currency on the 3Oth
Of June, 1873, stood as follows:
u S. notes and IsgAl-tender ....... sale, 900 600
National Bank notes 900
s76s.oOO 900
Less reserve Ia O0o 900
Total available currency .eo, ,OOO 900
The bonded debt had meanwhile been
increased from one thousand one hundred
and sixty-two millions in 1865 to one
thousand seven hundred and thirty-two
millions, over half of which had been sold
abroad, calling for about sixty millions Of
gold interest annually.
This, under the contraction policy
adopted and steadily pursued by the Re
publican party from 1865 TO 1873, the in
terest burden of the debt was largely in
creased; it was changed from home debt
payable in currency to foreign debt paya-
BILE in gold-the interest bearing notes
which had served the uses Of the people az
currency, bank reserves and Investments
by times, we're taken up, leaving vastly
smaller currepcy, the inadequate amount
Of which cramped business, checked enter
prise, and led to the substitution Of credits
which enormous interest to carry on the
enterprises and business Of the people.
The panic came and shook the credits
which were q bad and only partial substi-
tute for the destroyed currency and inter.
est notes-and the business of the cOun.
try thereupon collapsed.
why BUSINESS DOES NOT REVIVE.
Two years have passed since the panic
why 10 there no symptom of recovery
Why does each season, compared with thai
preceding, tell Of shrinking values, reduced
manufacturers and trade, greater suffering
among laborers, and bankruptcy among
producing and trading capitalists Why
are half of our iron furnaces out of blast
our wooden and cotton factories closing
our lands and lots being sold for taxes
bankruptcies multiplying : laborers at low
cred wages, put on half work or no work
and the cry Of want, amid the abundance
of Gods bOunties, going up from every in
dustrial centre in the land !
1t in because money IN plenty"-in thu
stagnant pools where craft dams itup, an,
scarce in the channels Of business where l
| wna wont In flow IL in hecnnaa cam kaliat