Perrysburg journal. (Perrysburg, Wood Co., O. [Ohio]) 186?-1965, 1876-02-25
Gen. Gsraeld,s views.


ONE cf the hest and most timely contrlbu,
tons TO the pending currency discussion is
Gen. James A, Garficld's article In the Februs
ary number OF the Atlantic Monthly. The
writer has long been known ms among the
nblest and most estmable Of our public
men, and his experience has been such as 90
give peculiar value 70 his financial views.
The object of his present article is TO show
how far we, as q nation, have drifted from
the sound principles held almost unanimous
ly up 10 tho close Of the war, and 20 enforce
the reasons for returning to those principles
as soon as possible
Gen. Garfield shows that the father of our
present financial policy, Secretary Chase,
knew perfectly well the dangers TO which he
was exposing the country by the adoption
of the system Of irrcdcemable paper cur.
rency TO which he was driven by overwhelm-
ing necessity, In 1882, when some one in
conversation had defined motion as "the
spirit of God made manifest in mattern the
Secretary said; "If that Is good dcfni-
ton, then legal-tender notes must be the
devil made manifest in paper; for no man
can foresce what mischief they may do when
they are once let loose" Quotations are
made from the Congressional speeches Of
Thaddeus Stevens, Senators Fcssenden and
Sumner, and others, to prove that the legal
TENDER system was only regarded as an abb
solutely necessary war measure, to be reltn-
quished rs soon as the dangeT should be
tadyes reiterated the same position;
but since then there has grown up
soft-moncy party which, without much con-
sistency in the views of its several subdiyis-
ions, will concentrate its forces for the final
battle Of 1876 Gen. Garfield then quotes
from the soft-moncy champions, like Judge
Kelley, Gen. Butler and others, showing
those fallacles aud extravagancics which are
sufficiently familiar to the public He
shows,too, that every one of these absurd.
ties Is not new-they have all been put
forth by English theorists in former times,
and nearly all have been practically exploded
as thoroughly as John laws schemes.
Against them all stands the impregnable
doctrine of hard money, which Gen. Garfield
elucidatus with such admirable directness
and force. The functions of coin in general
are well understood; but the relations of pa.
per to coin-the point where the dangers OF
excessive papcr-issues take their risc--are
rarely so well st0tad as in this article. 1t
is pointed out that credit is not capital, but
the permission given to one mas TO use the
capital of another. Gen. Garfield says;
Frequently, however the capital loaned is not
actually transferred TO the borrower but written
evidence OF his title to 1t is given instead. II this
title is tnusferableit may be used az Il substitute
Tor money ior, within certain limits, y has the
same purchasing power. When these evidences Of
credit are in the form OF checks and drafts, bills
of exchange and promissory notes, they are largely
used as substitutes for money, and very greatly
facilitate exchanges But all are based upon con.
hdence. upon the belief that they represent truly
what they profess to represent-actull capt
tai, measured by real money, to be delivered on
demand. @ ~ 81 -' -e +-t
These evidences Of credit have become in mod
ern.times, the chief instruments of exchange. The
bark has become as Indispensable to the exchange
oil values as railroads isto the transportation Of
merchandise. II Is tho institution OF credit by
means of which these various substitutes for
money are made available II has been shown
that not less than 10 per cent Of all the exchanges
In the United States are accomplished by means
of bank credits The per cent. In England Is not
less than Dj. Money Is now the small change Of
commerce. II ia perhaps owing to this fact that
many are so dazzled by tho brilliant achievement
of credit as TO forget that 1t is the shadow OF capt.
tal not its substance; that is the sign the brill
liant sign, but not the thing signifed. Let II be
constantly borne in mind that the check, the draft
the bill OF exchange, the promissory note are all
evidences of debt, OF money to be pRid. IL not
they are fictitious and fraudulent II the real cap.
ital on which they arc based be destroyed. they
fall with it and become utterly worth ess II CON
fdence in their prompt payment be Impaired, they
immediately depreciate in proportion to the dis
trust. .Hr..
OF that character is our gree nback. 1t is
an evidence of debt, a promise to pay. 1t
is not money, and no power on earth can
make it money. 1t is a title to money, but
can only be made equal to money when the
debtor performs his promise. "When that
is donc,n says MIR. Garfield, land when the
community knows, by actual test that it
wilTcontinue to be done, then, and not until
then, this credit-currency will in fact be the
honest equivalent OF money" When that
point is attained reasons of convenience
will ordinarily make paper preferred to coin
and will give it its highest efficiency. Any
thing short of this complete convertibility
depreciates the paper currency, drives away
gold, introduces constant fluctuations of
prices, cuts down our foreign trade ON both
its export and import sides, gives a stimu-
lus.to the Widest speculation, and ruins the
laboring man. There has not been tnan.
cial evil which has cursed the country since
the war that has not been due to this cause
of an irredeemable currency though other
influences have sometimes co-opcrated with
it, -
Gen. Garfield closes his, paper--of which
we have given but mere sketch-with
powerful statement OF the duty now resting
upon the Government to restore the con-
Hertibility of paper and coin, to redeem its
promises. to give the people sound money
1he hardsnlps OF the process, he believes,
have been grossly over-estlmated He saws:
" | am not able to see why the approach to
specie may not be made so gradual that the
fuctuation in any one month will be less
than that which we have suffered from
month to month since 1869. We have trav.
eled more than half the distance which then
separated us from the gold standard. A scale
of.appreciatiOn like that by which England
resumed in 1921 would greatly mitigate the
hardshps arising from the movement.
Those who believe that the volume of our
currency is but little above its normal level
need not fear that there will be much con-
traction; for, with free banking, they may
be sure that all the paper which can be an
actual substitute for money will remain in
circulation. No other ought to circulate"
Resumption, he thinks, could have been ac-
complished more easily in 1867 than it can
be in 1919, and it can te accomplished more
easily then than at any later period. 1t is
of no use TO wait till the vast mass of ptl-
waite debts can be adjusted, for that will
never be. Lctus rat..er copy the intrepidity
of France in getting back to specie payments
as soon as possible, and in realizing the
blessings which she has shown to wait upon
such just and honorable course.-BoSton
JoUrRdt.