The Emporia news. [volume] (Emporia, Kan.) 1859-1881, 1877-07-13
silver lIeprectased BY Law.

intelligent readers to the follow
ing clear statement of the silver
question.
Among the statistical papers
laid before the select committee
of the British House of Commons
last year was one by Ernest
Seyd, very eminent authority
which concludes as follows:
The true cause of the depreciation in
| the value of silver is its characterization
by law, and that only. England took
the initiative in 1916: but as long as Ger
many maintained silver the eQuili brium
was main tanned. Germany having fol
lowed England's course, that equilibrium
| is lost.
An appeal to the natural laws of sup
ply and dem4nd, as likely to settle this
| matter, or as tending to show that the
depreciation must be due to an incre ased
| natural supply, cannot be made IN this
case, for 1t Is the demand which not by
any natural cause, but by deli berate legis-
| latiOn, has here been forcibly restricted to
limit. In all questions where the natu-
al laws of supply and demand are inVolv-
ed, that OF the demand is as important,
If not more so, than that OF the supply.
Under the force Of legislation, matter
under direct human control or intelli-
gence, it is the case Of the demand which
here has precedence. II the demand has
not been so Influenced by an agency
apart from the natural laws of supply
and demand, and the status quo hitherto
existing had not been fOrcibly changed
thereby, 1t follows:
Firstly. That there would be. no sur
plus stocks Of silver to dispose Of.
Secondly. That the fresh natural sup
plies of silver would be absorbed. as,
together with those of gold, they have
always been absorbed before.
Figuratively speaking, If the abolition
Of the demand for silver for the purposes
of legal-tender money contributes 90 per
cent. of the decline in its value, the Sec
ondary causes, that of the surplus stocks,
contributes another % per cent, and
that of the fresh supplies yet ~ per
cent. to such decline; but the two causes
would have no raison dtere but for the
first.
This represents, in my opinion, the
true order of the causes of the deprecia-
toin of silver; In total independence of
all matters OF theory or practice inVolv-
ell in the general problem.
According to this view, silver
would not have suffered any de-
probation whatever, had there
been no interference by legisla-
ton. The bulk of the demand
for silver is for coinage. Even
partially take away its money use,
then ensues strong competition
for its sale in the presence of a
greatly diminished demand. OF
course price falls under such cir
cumstances. The further demon
citation is extended the more
rapid must be the decline. Gold
would have been affected in the
same way, had that metal, instead
of silver, been the object of de-
monetization. Then the million
aire bondholders of the world
would be demanding payment in
silver, because the most valuable
of the precious metals, and be
bitterly denouncing as dishonest
all who favored the remonetiza-
ton of gold, and discharge of
our obligations to the public cred
ltors in the deprecated coin.
Very much of the commercial
value Of either gold or silver is the
crature of coinage laws. The
intrinsic value of each OF these
metals is far less than the intrin-
sic value Of iron. Were there a
universal discontinuance Of the
use of gold and silver as money,
the purchasing power of each as
commodities would be vastly re-
duced from what they are now.
Then the natural laws of supply
and demand would regulate the
price. The demand for coinage
is created sorely by legislation,
and is adventurous and artificial.
Here IS an example of the fact
that law can create and establish
value, since such value would
not exist but for the governmental
action, and since such value
would cease on reversing action.
It is only the interference of
ill-advised legislation that has
disturbed the equilibrium between
gold and silver by arbitrarily alter
ing the relations long maintained
between supply and demand. By
remonetizing silver through the
reccinage of the old silver dollar,
we can do very much toward the
restoration of the lost equilib-
rum. This is exceedingly i'm
pertant just now to the recupera-
ton of industry and trade; for
it is law OF exchanges that the
volume of the currency deter
mines, In a large measure, the
volume of the production and
consumption. Contraction of the
former has invariably contracted
the latter; and expansion of the
one has always accompanied the
of the other. While
the country is progressively los
ing by the contraction of the
paper currency, the government
legislates to contract the specie
basis also, thereby narrowing and
weakening the foundation upon
which productive industry is re-
CURED to build. We are being
forced to payments in coin, and,
1t the same time, deprived OF one
half of our coin.-Inter Ocean. |