, 1876-02-27

although this is the Centennial year.
KELLEY ON CURRENCY, CREDIT. AND CON-
TRACTION.
The Hon. WILLIAM D. KELLEY has been
making another speech on the currency
This effort, lie all that have preceded it.
shows him to be, in the language Of the Hon.
Ba7,dapeN Slote, a P. L ca perfectly indie
pendent gentleman, independent OF logic,
the truths of history, or the political economy
of his country Independent of common sense
and of his party, which oughtto send him back
to private life "by large majority Hisan
idle task to follow the Hon. WILLIAM Of the
Wisp through all his false trails, but some OF
the fancies and fallacies Of his speech deliV-
cred in Congress on the 10th inst. are anus
ing enough to be noted Passing BY the
unseemly skill with which this tariff thi1nble-
rigeer shuf1es On to the currency the ''sad
condition" of the workingmen of Penn
sylvania, betrayed by 'Protection," and
pausing only to express "eu-founded
doubt whether N1r. KELLEY needed to 60 so
far from home as to father upon HuGn Nc
Cu11ocu, Secretary Of the Treasury under
ANDREW JOHNSON, the responsibility for the
swollen recruits to the ranks OF the Insane
Asylums, Houses of Correction, police-sta-
tions, and Founding Asy1uns, in the Vlc1n1ty
of MIR. KE11Er's home, we will consider briefly
Mr. KE11Ky's extraordinary assertion that the
panic of September, 1873, WAS caused by the
contraction of the currency. Evidently, Ar.
KELLEY does not know what q crisis is, nor
| what constitutes contraction of the cur-
roucy, nor what currency IS Excepting ID
these points, he is perhaps as well qualified
as q Pennsylvania high-tariff Protectlonist
| could be to express IN intelligent opinion On
IN economic question Mr.. KELLEY states
that the volume of legal tender was, June 80,
! 1865. SC6s, ,910,S00. To show how not ut all
these figures appertain to q comparative dis
cussion of currency, it need only be sald
| that MIR. KELLEY includes S191, 721.4 40 OF
6 per cent compound-interest notes; S., 4G7,-
| $40 Of one-year s per cent notes Of 1oG3
S7.715.950 of two-year per cent notes of
1868 $344 Ill $50 of two-year coupon notes
of 1868. This aggregate Of above S244, ,0o0,-
600 of Understanding Government securi-
ties hns no more right to place in an emu
meration of currency than Mr. KELLEY to q
seat among the im1nortals. A1r. KELLEY can
not produce banker to testify that any of
these securities circulated as money three
months after their issue. In comparing the
volume of currency in 1866 with that in 1873
A1r. KELLEY, with the artful carelessness OF
SEnro1E in pecuniary matters, ssaps over
the circulation of the National Banks,
which was only S109, ,s00,332 in 1865,
but had risen to $319, ,202 in 1875.
He utterly ignores tho essential point
on which the whole currency question
turns, viz. the purchasing value Of the cur
repcy. It is not tha number Of pieces of
pictured paper that determine its worth, but
their purchasing power. If it were the
former, the Confederacy would have been SO
far ahead Of the Union in the sinews of Wal
| as to have beaten us out Of sight, The "law-
full money" OF the country Ind an actual
purchasing power in the markets OF the
world of about CS cents in May, 1865; IN
September, 1878, Of about sc cents. Admit.
ting this suppressed but all-important fact
into the calculation, how does Mr. KELLEY
come out? Taking Mr.. KEr1Er's figures
for the joke of the thing (nobody would
take Mr.. KE11EY's figures in earnestly, anC
allowing him in 1865 $500, 600, 600 Of lawful
money!" including the non-circulating com,
pound notes, and adding thereto $40, ,o0o, ,0oo
Of National. Bank currency, which ho omits
and turning then to 1873, when there was
s40o, 600 GOO Of ''lawful money" and $780,
. 0o0, 600 of National-Bank notes, let Us SCI
when the country had the most currency
that is, the most purchasing power
for currency is useful only to buy thing
with. In 1865 Ssos, 1000, 900 Of paper, wortl
cs per cent, had purchasing power equal t.
. $3.50, ice, 600 of gold. In 1873 $7o2, 600 ,oo'
. Of paper, worth So per cent, would bu.
+ SC21, 600 900 of gold value. If this is con
, traction, We will admit that contraction
caused the panic. But it was an actual e1
! | pansion Of S71 1000, 900 Of gold value of th'
currency, and that, too after including NOR
than s244 ,oo0, 900 Of Understanding pape
:. Tint never circulated from hand to hand q
l | money.
$ So much for A1r. KE11EY's figures til
q facts tell much worse against him. Th
: actual circulating medium or currency Q
i the country, in 1865, was, counting green
=. backs, fractionals, and bank-notes, onl
+ S5C5, ,oo0, 900, with purchasing power equt
: to $3s4, ,2oo,o 900 Of gold. In 1873 it va