New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1875-08-21
THE PAPER MONEY DREAM.

FINANCIAL POLICY-AN EXPONENT DURING
PERIOD or sTRINGENCY-TBE OUTCRY AGAINST
CoNTRACTIOy-TuY DREAM or THE INITIATION
IsIs-THg CRAsH-THE PANIC on 1878 CAUSED
BY A REDUNDANT CURRENCY.
TO the u dtfor Of the Trt6une.
SIR: Nearly forty years ago Daniel Webster, the
greatest constitutional lawyer and one of the great
est, if not the greatest statesman our country has
produced, uttered the following memorable language
in the United States Senate:
Most unqucsfionaby there ia no legal tender in this
country under the authority OF this Government or any
other, but gold and silver her the coinage Of our own
THIS ia constitutional principle perfectly plain and q
s Esd S maRns anything but gold rs
legal tender In pay ment OF debts, and although no snch
gess has no power granted to it in this respect but 70
coin money and regulate the value OF foreign COINS
has no 70 =" es s or $
OF contracts Congress has exercised this po"or fully
coins it it has regulated the value q foregn
f tens a%a si the Iesds Of
established and cannot be overthrow 10 overlhiow u
ances for cSe"ns he 1Goring classes otmanind none
has been more eiiectual than that Which denies .nem
cessve taxationthese bear lightly on the happiness Of
the OF the community, COMPARED WIN iialn.n!
paper our history has recorded for our instruction
enough and more than enough OF the denorshzins
tendency, the injustice and the ntoerabe oppression on
the and well disposed. of degraded paper eur
rcncy authorized. in any way countenanccd by tho
Government
These remarks Of the great orator and statesman
were unchaenged in the Senate and out of it no
body then doubted their correctness. II must be
borne in mind that Mr.. Webster not a strict
constructonist of the Constitution. and Vet in this
passage he denies the right of Congress to make any
thing but gold and silver legal tender in payment OF
debts 1t will also be remembered that he favored
well regulated and convertible paper money while
h. denounced in indignant language an nconvertibls
and deprecated currency.
A WAR MEASURE
In opposition to this opinion of Alr Webster, and
Notwithstanding his warning-a warning justified
by the history of other nations well of our own
Congress, under the pressure Of great emergency
lbut as temporary and war measure only, in Feb
ruary, 1862, passed an act authorizing tho issue OF
notes which should be legal tender in payment OF
debts-the full mischief of which first step in tho
wrong direction has not yet fear, been realized.
Under this and subsequent acts $iO0,OOO,OOO were
iss,led-neary the full amount of which IS still in
circulation-more than thirteen years after the first
ISSUE and than nine years after the emergency.
which, and which only, in the opinion OF those who
advocated the measure, justified il, had ceased
In speech at Fort Wayne, in October 1868. the
Secretary of the Treasury foreshadowed his own
policy and what he thought should be and would
be the National policy in the following language:
am not one of tho.e who he disposed to repu:
date coin Il of value ana 10 maze scureq
paper currency the standard On the contrary belong
to hat class OF persons who regarding an ehcusvey
entcrprsng and commercial people nevertheless look
upon mredeemable currency as an evil whit cIcan.
wlch Is never 10 be sustained az q policy 10y common
of the nation gold aud silver are the only true
tina. these metals were PREPARED " Ron aes cas wers
which they being nst0-
/ favor wesecured convertible paper currency-ne
have no faith in pro- Gritty Which is the result Of
deprecated currency nor can see any safe pain oT us
extreme high prices which now prevail in the United
states nerng indication that the business on me
values by false standard We have circulating
medium altogether larger than is needed TOT iegtl4a
United states to-day the best market IN the world
The SEE eon. .e n% i that Europe selling
than SHE buys of us ncrding our securities whch
against us which must settled in part at least with
The longer the initiation continues the more dif;
cult will il 10 get back to the solid ground Oh
specie payments, to which must sooner or later re-
Efb on e funding Of the legal and the
reduction commenced and carried ON resotey Ds
out serious to legitimate business other
wise shall have brief period OF hollow anu seduo
tive prosperity resulting in widespread bankruptcy ana
But while nxious about the present imitation and
s effect upon the business and the morals OF the country
am hopeful that by wise legislation we shall escape
financial collapse am hotefiu that the currency may
be brought to the specie standard without thts
financial troubles which have in all other countries f0t-
lowed prOtracted and expensive wars by the exle-
rence of the last four years are led to the conclusion
people have latent power That manifess itei
when required, and Is equal TO any emergency. hhS
faith that have the astonishment OF me wofh,
raj .ed immense armies-larger. apprehend, than any
ngle nation brought into the neid-anC met mo
enormous expense Of the war without borrowing FROM
crisis fund surplus currency ana ere.t-Dear2
notes bring back business TO specie standard anu
place credit OF the country On tine mos SOUND ana
stable basis.
This speech or at least the financial portion Of
it. was published in most of the newspapers, and
was AS far as the Secretary could judge
by the comments upon it, favorably received
by the press and the people. The views
thus foreshadowed Were somewhat deliberately
presented in his first report to Coagcss, De
cember 1865. In this report he pointed out, ~
clearly as he able. the causes of previous fnan'
cial crises; the deusyeness of the apparent pros
perty of the country the injurious effect OF q de-
preciated and fuctuating currency upon business.
and its domoralizng influences npon the people; tho
wide departure of the Legal-tender act from that
strict construction of the Constitution given to it.
prey ious 10 the war; by patriot men Of all parties.
&C.. &C.: aud he recommended, as the proper
remedy and the only remedy for the evils and dan
gers INF which the country had been involved, the
gradual withdrawal of the lega-tender notes, and
the curtailment of the currency until it should he
canal to specie The views thus presented. having
been carefully considered the House Of Representa-
tiyes. rejecting undoubtedly the existing popular
sentiment, passed, by of IA to 8. the follow
ing resolutions:
Ecso,r,5 That this House cordially concurs In the
views of the Secretary i'm relation 10 the necessity o