New Orleans Republican. [volume] (New Orleans, La) 1867-1878, 1875-09-01
Wendell Phillips on the Currency.

| SO much interest attaches to the views OF
| Mr.. Phillips on all public matters that we
reproduce his r, Garkable letter on the cur
rency, which has already excited much
comment:
AUGUST %. 1879.
MT Fngene Beebe, Secretary of the Legal Tender
DEAR SIR-I appreciate the great import
| ance of your agitation TO prevent further
contraction of the currency, and am sorry
| | shall not be able to attend your meeting
| in September. 1t seems to me there are
but two questions to be considered touching
| the currency:
Flrst-Upon what basis shall it rest
Sec0nd-How much of it shall We have
a long time ago there might have been a
| third-of what shall it he made, gold and
| silver or paper But the experience Of
| business men long ago answered that in
| CURRY and settled it beyond recall that
| throughout Christendom the currency must
| be paper. 1t is idle to talk to-day of a spe-
Gle basis. That gentle hallucination has
| been encouraged to quiet timid men and
| delude the masses. But the thing itself
| has not really existed tor fifty or hundred
years. Great Britain, where, if anywhere,
| such basis could be maintained, has to-
| day fifty cents OF coin to 500 of paper.
| Patterson. Science OF Finance, PIP 5, 6, 81,
| 2S, 81, So, Edir burg 1861
ANY individual may have that fifty cents.
| provided he does not need it, and provided
| there is no special reason why he should
have it. If at any time his business ALSO
| lutely requires that should have that fifty
| GEMS of coin, at that time he can not have
| it. A specie basis of fifty cents coin to
support 500 paper 1t reminds me OF that
IRISH six.bottle topper who always sat down
to drink with a small bit of a strawberry
at the bottom of his wine glass and kept it
there through the evenng--"It gave so
fine flavor to the wint!' Doubtless that
fifty cents coin gives a strong specie favor
TO the vast system of British paper and
makes Bull feel warm and comforta BILE.
Political economy settles very few points
by theorizing. Now and then experience
decides question, and it passes into &C.
copied and undeniabe truth. In this way
business experience has decided that cur.
rency, in civilized and commercial nations.
must rest on credit and consist of paper.
Thus experience answers our first ques toD
the currency does rest and must rest on
credit. Whose shall that credit be? Shall
it be the credit of banks and their custom
ers or the credit of the natioL9 This ques-
ten also experience has answered Be
fore the war we had banks resting each
one on its own credit. We all remem-
Der the result. TIE bills of bank ceased
generally to be current a hundred miles
from its own counter. You lost ten per
cent in changing those of the South aud
West for Eastern bills; and Horace Greeley
demuNly told the committee who paid him
handful of Western bills: "lf convenient
l should much prefer we'll executed eoun-
terfeit on some Eastern bank" What
makes our national bank bills good. and
equally good, everywhere to-day! The ma
ton stands behind them. Such notes pass
everywhere, and everywhere at the same
value, because the nation guarantees them.
All the note currency we have rests on ma
tional credit, directly or indirectly. No
man can give a reason why tEey should not
all rest directly on national credit; why all
bank bills should not be withdraw and
legal tenders supply their place.
In building house you do not put plat
form between the house and its foundation.
Certainly not Your walls rest directly on
your foundation. To-day the nation pays
the banks 40 900. 900 or more to allow them
to play the useless part of standing be.
tween it 1.-THE nation) and its own cure ncy
pr. Franklins hero. who asked his victim
to pay for heating the poker, was most
reasonable person aud Solomon compared
with ourselves in this matter. l have heard
OF an incompetent man put under guar.
dianship and obliged to pay trustees lib
orally for taking care of his property, but
| never heard of one put under guardian
ship and paying his guardian literally aud
then obliged to do all his own business be-
sides, which is exactly our case. We fur
nish the credit that supports these bank
bills and then we pay the banks for using
that credit.
Bagehot the highest authority IN Eng.
land, says the public takes Bank of Eng
land bills without inquiry or hesitation, be
cause it knows shat in any emergency the
government will sustain the bank. Here
our bills pass because the government is
distinctly pledged to do SO. The two great
commercial centres have drifted into cur
rency based, in fact, on government credit,
and they deliberately accept the situation.
Our first question, On what shall our
currency rest' is fully answered by facts,
In commercial nations it rests, and must
rest, on government credit.
SecOnd-How much cure ney shall we
have?
No single man, officer or institution can
decide or ever did decide this question,
Currency made up of bank bills, deposits,
notes, bills of exchange, etc, is like any
other article OF manufacture-we make as
much of it as we need. The business of n
country. when not interfered with, always
settles the amount of it's currency. Business
creates everywhere, and at all times, lust
such and Just SO much currency as it needs.
Banks and secretaries of treasures imagine
they determine the amount of curreney,
As well might Old Probability claim that he.
determined the weather. He and they only
record what mightier forces do. Hats,
shoes, wagons, rails, cloths, cotton, wheat
one year we want more, the next year
less-who decidesl The dealers in the
article and the users of it, Does any
body advise going back to days and
having some board of wiseacres decide
how much wheat shall be planted, and
how much cotton. how many loaves
or wagons made? No such dreamer OBJ
trudes himself on the public. But thous.
ands olamor for allowing bank directors
and them alone TO settle the amount of the
currency. And they are allowed more con
troll than any other agency. The New York
city banks alone increased the currency
$4,000. 900 $2,957 ,200l in one month, Sep
TENDER, 1874, and decreased it $5,0OO,OOO 10
one week Of Macrh, 1875. The aristocracy
in the money manufacture is an odious
monopoly, alien to our institutions and
harmful. 10 our prosperity. What should
we say If 900 men, and such friends as thew
chose, were allowed to plant wheat and
mine iron while every one else was for.
hidden?
Yet this is but another name for our pres-
ept bank system. Let us cease, then, to
have any plan either to enlarge or contract
the currency. Let the government stand
ready to issue all the currency any business
man wishes and can give good security for.
at low interest and convertible into long
bonds. Ii necessary, in order to coneiliate
existing prejudice, let the capital of these
bonds, having long terms to run, be payable
in gold. Make greenbscks legal tender for !
all purposes, customs and alt UoyArument