Memphis daily appeal. [volume] (Memphis, Tenn.) 1847-1886, 1875-11-04
KEY On CONTRACTION.
What the Successor Of Andrew John.
son Thinks Of the Currency Cues
tiOn-The National Banking
System.
Contraction and Forced Resumption
Mean the Ruin Of the COUntry-NO
Use Of Talking about Hard
Money Just NOW-Etc.
Nashville American, ]

Nashville Americana
CHATTANOOGA, October 30.-As con-
siderable has been said in the newspa-
pers of late both at home and abroad,
"a to the views held by Senator Key
upon the currency, and believing that
an EXPRESSION from him would he of
more or less interest to the entire State
your correspondent waited upon him at
his residence last night with view Of
having conversation with him upon
that subject. I found Senator Key in
the enjoyment Of excellent health, and
was received with q cordially which at
once placed me at my ease. The follow
ing interview epsued:
Correspond is your Opin-
ion, Senator, as to the cause Of the pres
ent stTingency in financial circles?
Senator Key-I believe the present
crisis wGs brought about by the wild and
Improbable speculatiOns Of such men as
Jay Cooke and others OF his class, who
by their recklessness caused the
moneyed men of the country great loss,
and consequent lack of confidence in
such men generally, and lei them to
lock their money liz their vaults, where
it yet remains.
C0rTespOndent-Wh are your views
as to TIE resumption Of specie pay.
ments and consequent contraction Of
the currency?
Senator Key-I am decidedly opposed
to forced resumption of specie payments,
and believe the law Of January, 1875,
ought, by all means, 20 be repealed.
There should be no contraction Of the
currency. I believe that the redemp-
ton Of our legal-tender notes will not
be practible until cur bonded debt shall
have bean paid; nor do l thiuk the spirit
or letter OF our contract or pledge re-
quires our earlier payment.
esp9ndent-What effect do you
think 8 f0rc5G resumption Of specie pay
ment would hsve?
Senator Key-A forced resumption OF
specie payments would work q cOntTae-
ton Of the currency. The national
banks would be compelled to eieem
their issues in gTeenbacks, and the
national bank issues would be thus ab-
sOrbed and disappear from cur currency,
leaving its volume diminished to the
extent OF the bank ciTculatiOn,say about
ore-half We would have no currency
for these notes in their stead.
COTe5pondent-Wh effect would
contraction have?
Senator REORGANIZATION would in
crease the wealth Of the owner of mon
ey, and the creditor, at the expense Of
all other property and the debtor class.
II A owe 3 one thousand dollars he
may now pay with money that is tif-
teen per cent. in value less than gold
that is, eight hundred and fifty dollars
-, - 4 90 = -hog,
the debt was made; tut if We force re-
sumption OF specie payments we make
the currency equal TO gold, and the debt
or has 70 pay the creditor one thousand
dollars in gold or'its equivalent; that is,
the creditor makes and the debtor loses
ole hundred and fifty dollars by the op-
Grafton. The effect is 10 make the rich
richer and the poor poorer. This con-
traction would reduce in the same ratio
tbs value Of all other property, includ-
ing land ard lis productions.
COrespondent-Wh would be the
effect upon our own and the southern
States generally?
Senator Key-I dOn'C see how the
southern States could pay their debts,
and our railroads and our municipal
corporations would be utterly ruined, ss
well as the DEBTOR class generally. 1t
might be that New England, New York
and few other States would he bene-
fitted by forced resumption. They have
nearly al the currency, and the increase
ia its issue might compensate for the
depTec alton Of other property in those
States. On the other hand, the south
ern States have neither money nor
credit, but are heavily in debt, and such
distress as we have never seen would
follow the contraction Of the currency
which would result from forced Tesump-
ton of specie payment. II would in
crease our Indebtedness fifteen per cent,
according present value and lessen the
value OF all property, except money, If
teen per cent. 1t would Re ally bring
about such 8 state OK affairs that we
could neither buy nor sell anything. 10
this country and in England in times of
panic, the legislatures have auth orized
banks TO suspend specie payment. Now
We have the mcnstrous policy of the
forced resumption OF specie payment
urged upon us III the very midst Of
hard timeE-an opposite course to
the one shown 70 be necessary by
all experience. England suspended
specie payment for twenty-four
years during the great French wars and
after. She had the accumulated wealth
Of long centuries. Her property and
productions were not consumed and de-
stroyed without compensation, and her
industries were Quickened and aug
mented by the demands created by the
wsrs Of Europe; yet she did rot at
tempt ID resume until the business OF
the count Y justified it, Our county
was, but few years ago, the lhester Of
a terrible war; property 70 the value of
four billions OF dOLa-5 was wiped out by
the emancipation Of yhes aves; the peO-
pie Of the south have seen the produc-
tons Of four years consumed and de-
strOyed without compensation; her sys-
tenn of labor has been rev0lutioDized,
and no new one as yet fairly organized;
she has no accumu ataI wealth. II eX-
perience hiss shown any fact, 1t is tbat
specie payments are suspended by PAN
les, and resumed only when business is
prOsEeIoU5 and panics have passed away.
To attempt to resume now would be
ruinous TO southern interests, as | think.
The north made money by the war, and
did not lose SIS We did, and would pass
through the proposed change better, but
I believe the ncTlh would also suffer Sc
verely.
lease give me your
views in fail as 10 the present system Of
national banks and banking, and what
effect their abolition would have upon
the country?
Senator Key-BefOre our bonds are
paid and We resume a specie basis we
must bank upon our Indebtedness, that
is, upon our bonds or treasury notes, and
We cannot destroy our present system
until q better one is devised. I have no
partislity for national banks, aud / have
no interest in them. ] have desired to
see some safe and easy way by which
we could dispense with them. II we de-
stroy them now, it seems 10 me it will
sggravate the commercial distress which
is upon us. They would force the col
lection OF their debt, decline sill loans
aud accommodations ana draw IN their
Gu Ter cy, snd at the same time hoard in
their vaults al the leSa slender notes
possible for he redemption Of the bank
notes, producing an imme, late cOntrsc-
ton OF cur currency. The closing out OF