The anti-monopolist. [volume] (Saint Paul, Minn.) 1874-1878, 1876-08-31
THE FINANCES.

CREENBACKSv VS., THE NATIONAL BANKS
From the St. Louis Commercial Gazette.]
A short time since the St. Louis Daily
Journal under the head 1.-The Democrat
ic Failure made use of the following
language:
..There can be no doubt that the green
back theory, if put in practice, would, IN
a few years result just in such financial
crash as overlook the country IN 1878.
All history points to this one result OF
large issues of irredeemable paper cur
rency."
/ On July 9Th, the writer whose name
will be found subscribed, made the fol-
lowing rejoinder which it commended to
the attention Of readers in the Gazette.
] He says: One of three things must be
true as regards the writer OF the above
extract.
lst, he does not comprehend the
'.greenback theory" or. I'd, he willtully
misstates; or, Sd, he fails in the employ
ment of Il correct use OF terms.
Assuming the difficulty lies in the hrst,
we suggest the following:
That the "greenback theory" does not
contemplate the issue of ''irredeemable"
paper currency. In fact it is the only the
ory ever devised for the issue Of paper
money, where instant redemption may
be made possible.
1t is claimed that Tin the interchange>
ability of national paper money with
government bonds, bearing fixed rate
ofinterest, there is subtle prlnclple
that will regulate the movements OF u
nances and commerce as accurately as
the motion of the steam engine is regu-
lated by Its governor"
The 'greenback theory" provides tor
the redemption of the paper currency by
the government. on demand OF the hold
ers, in her own interest bearing bonds.
When it is considered that the bonds
are more valuable than gold, as the mar
ket every day attests, it must be admit
ted that such redemption IS all that could
be desired.
.. It will be remembered that the laws
providing for the first two issues OIL
greenback, in exchange for the services
Of soldiers, and for military stores and
supplies, male part of the consideration
to the holders OF those notes, the right &c
, convert them into 6 per cent,5-2O bonds
, In but little more than year from thai
date, after hundreds OF millions OF those
notes had been paid out as full equlva
lent for services, stores and supplies, Con
gress passed an act repudiating the righ
+ of convertibility after July l, 1868 thus
rendering them an irredeemable curren
, cy and subject to the depreciation which
) followed.
On this point we submit the evidence
kn
4 Der of the committee that drafted IN
! legal tender act,a well as the natlona
= bank act, and who has been promlnen
:, president of 4 national bank in Buffalo
:. New York recently delivered in address
: before an assembly of bankers at tn
!, Centennial grounds in Philadelphia, i
. which he used the following language
Il said on another occasion, and | re
q produce it here: The great mistake
greater than all other mistakes in tn
: management of the war-was the abro
;. CATION OF the right TO fund the greenbac
e currency into gold bonds,as provided TO
. in the two proceeding acts" All the OFT
: er mistakes. civil and military, whic
occurred during the war was Of ligt
a consequence when compared with To
! mischievious and grave consequences r.
. sul;ing from this one mistake. Iakln
!, away from the holder OF this paper cur
), rency the right to redeem it on deman
in gold (nteresD bonds, besides bein
- manitestiy unjust to the holders. let th
- government and tho whole country
: banks and people-down into the sloug
: of an irredeenable paper currency. whel
Is we have remained for over eleve
=. years
- Ii the right to fund the greenbacks I'M
- the six per cent. gold interest bonds ha
not been abrogated.no financier or pras
= teal business man whose opinion
as worth quoting. can doubt that we wou
> have gone to specie payments within tu
I or three years after the close Of the we
20 in spite OF ourselves. The individual i
AZ debtedness al the close Of the war in 1s6
was small. Every one was comparative
of tree from debt The six per cent. go
n. bonds were sought Tor as an investmer
~ They soon appreciated to par in gold al
ii the right to fund had been continue
% the greenoack currency would have q
n preciased to par in gold along wi
rs bocds.'
ia Now. II the Journal is ..financier
n practical business man whose opinion
ar worth quoting" he must. according
Mr.. S. admit that it they had not aba
doned the .'greenhack theory or co
= ver:ibility, we would have been carried
- - resumption as early IS 1867 or 1868.
And five had reached resumption
- Ts by the appreciation OF the yreenbae
&c does the journal insist that We wor
have been visited by the panic Of rs:
Ter Upon this point we submit the folio,
we ing testimony, taken from letter OF j.
Earl Williams. PRESIDENT the Mesrop
'ut itan bank of New York. TO John Sd.
Fm man. Chairman Senate Finance Co
or mittee:
an AS to the cause or causes OF the L
u financial panic. | consider it unden:a
pt- and self-evident- that last September
lst touched bctto4n in our currency supp
Ii superintendent ten years be.ore,ii y
,ix- proved to demonstration 10 be used