New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1877-12-11

PLAIN Truths FOR UESTERN READERS
To intelligent men at the East, it seems a
most amazing thing that there is 50 great an
ind ference at the West as to the public
credit. For the South there is some excuse.
The debt was created in suppressing rebellion.
But the Western States were intensely and
vigorously loyal They gave without stint of
their best blood to sustain the Union. How
can it be that the people of those States care
so little for the honor of the Nation preserved
so largely by Western fidelity and heroism2
Yet PendlctOnism suddenly became 50 strong
in that region, at one time, that few Republic
can statesmen had the manhood to combat it.
Initiation swept over that section like prairie
fire in 1874. The demand for repeal of the
Resumption Act was resisted with difficulty IN
any Western State in 1875 and 1876 Now
the silver dcusiOn, coming swiftly like
nightmare, has driven crazy nearly every pub
lie man and journal at the West And yet
the people of that region are personally not
devoid of honesty nor OF cOmmOn-sense. How
is it that every sort of raid upon the public
honor prevails there so easilyl
Is it III part because the people of the West
do not comprehend how public prosperity de-
ponds upon public credit Daily experience
has not famliarized them with the effects of
credit upon commerce and industry. Crops
can he raised, whether capital is alarmed or
not. But merchants know that crops cannot
be moved unless money can be borrowed to
cover the cost while moving from the farm to
the consumer. IfCapitalis alarmed, Thanks are
in trouble, the movement Is instantly checked;
the producer has to sell at lower rate, in or
der to sell at all. The loss in price he feels;
the disorder OF the credit system, which is
often the true cause, he rarely perceiyes. Why
is capital alarmed, and why are the banks
in trouble The most necessary reserves
of banks, savings banks insurance and
trust companies and active capitalists,
are kept in government bonds Danger to
them, or a decline III their price, instantly
brings disorder to the whole money market,
causes corporations and lenders to call in
loans and refuse renewals, prevents the free
employment of capital which is necessary for
active business, and thus checks purchases
and shipments. The producer suffers. With
in the last two months, movement of crops
has been checked by uncertainties in the
money market, and Western and Southern
producers have already lost millions of dollars
because of the silver agitation.
The instant effect OF public credit upon
private prosperity is constantly felt at the
East. Mines employing an hundred thousand
men must stop work If the borrowing Of
money is checked by alarm of capital. Mills
and factories employing workers by the hundred
thousand are obliged to borrow constantly,
and a week of alarm in the money market is
q week of disaster to industry. Failures by
the thousand result from every new raid upon
the public credit. The alarm is not unreasOn-
able. Not only the National banks, by which
the greater part of commercial loans are made,
but nearly all financial corporations wisely
hold in public securities as large a part
as possible of their surplus or reserve fund.
Short loans are drawn in at once when there
is alarm, and Government bonds cannot be
adyantageously sold. la NewE England more
than one person TO each family is a depOsitor
in a savings bank, and the least danger to
these banks causes many to withdraw de
posts. But these deposits amount to twelve
hundred millions, and are largely employed in
moving machinery, paying wages and carrying
crops and other products TO consumers. An
alarm instantly checks the vast commerce and
industry which depend upon freedom Of bor-
rowing.
The West and South have to pay large
share of the cost of all uncertainty or alarm
in business. In part because unemployed
hands cannot buy so freely of Western pro-