The Findlay Jeffersonian. [volume] (Findlay, Hancock County, Ohio) 1870-1881, 1877-07-13
( CHANGE OF SENTIMENT,

the policy of contracting the currency
iurther for the present. This change
/ has been brought about by an euipha1-
| ic protest from the west, and TO which
il is intimated he may concede great
deal. On the subject of the curI ency,
We find in the Cincinnati Gazette, of
the 9th, an able article from the pen
Of E. d. Morgan, which we transfer
t. our columns entire:
On Sunday, the 9th of February,
1897, an order in Council prohibited
the Directors of the Bank of England
from paving their notes in cash-that
is, the Bank of England suspended
specie payments On the 1st OF May,
1921. the Bank of England resumed
specie payments. This the susl ens;O1 }
OF specie payments continued twenty
! four years and two months, or about
eight years longer than our suspension
! has continued. Ia the me inwhiie
several,financial events occurred which
are worthy of note, as illustrating tie
Consequences of that suspension aud
tie mode of resumption. For severl
years the bank paper did not fall ina
;erially, but in 1910 it fell 13 2 per
cent. below gold. When the bank |
suspended there were about $50 coun. |
ty banks, bat Oh the suspension of the |
Bank of England they began to in
crease, and in 1912 they had Increased
to 900. Discounts were easily obtain.
tanned, the harvests were deficient, the
intercourse with the Continent, pre-
viously cut off by Navoleon, was re
sumed, and in consequence of these
| facts grain and breadstnifs rose very
high in price, but the next year QSlD
the hervests were very abundant, prices
| fell rapidly, many farmers were ruined
and public confidence was lost. The
consequence of this Oh the country
banks was destructive; tEeir paper was
driven in; 240 stopped payment on
anything, and commissions of bank
ruptcy were Issued against eighty nine.
This made "A demand for Bank of
England paper, and in 1917 the notes
of the Bank of England rose nearly
equal to gold. In consequence of this
again, Parliament, by Peers act, fixed
resumption to take place in 1928. But
as we have seen, the destruction of a
greater part OF the country paper had
brought the Bank of England notes
almost to par, and, therefore, the bank
was ready to resume, and did resume,
in May, 1S2l-no less than twenty four
years after the suspension.
This little history surely teaches Us
some things on the financial question
of resumption. The first and greatest
lesson is that there IS no resuming
specie payments until there is Cery
large proportion Of gold TO paper. The |
country banks of England redeemed
their notes in the paper of the Bank |
of England, just as the national banks
redeem their paper in legal tender
notes. But what took place? 1t was
not until the destruction of a large
part of the country bank paper that
the Bank of England was able to re
sume. NV, put against that tinan-
ciai experience the fact that our finan-
cial theoretical resumptionists are try
ing to reduce the legal tender notes in-
stead of reducing the bank notes.
That Is, they are trying to put the cart
before the horse, and to kill the goose
which lays the golden egg. That is the
extent of our American financial wis
dom. That is the way We take advan-
tage of experience.
Now let US return to the facts stated
10 our former articles and absolutely
established by the experience of Eu-
rope.
1. We have shown that England,
France and Germany have in the cur
rent money of the merchant five dol
lars (S5) per head more than the peo-
pie of the United States. These are
among the most commercial nations of
thu world. To say, then that the peo
pie of the United States have too mech
money, and that amount ought to be
contracted in order to produce specie,
is the sheerest defiance of experience
and the uerest nonsense which can be
uttered. And yet it is perfectly evil
dent that the contraction must take
place, except(the only alternative) that
there is q vast amount of gold on hand
to make specie payment possible.
Chow much gold is possible to make
specie payment possible! OF course
we do not mean possible for few
months, a year, or two. That we
could have done long ago, and if that
were the ouly object, it ought to have |
been done. IL we want to exhibit to |
the world fhe vanity of resuming spe-
Gle payment Oh fifteen cents to the dol |
lar, We can do it at any time, and then |
have the pleasure of seeing every bank |
in the country break in two or three |
years. L. does not seem to NE that is |
sort of II vanity the great American
nation ought to indulge iii. If we are |
for hard money, if We are to pay metal
for our debts, let Us make it perIna- |
nent system, something We shall not |
have to retreat from. If, like the |
AbySsiuiaD, We insist ia wearing brace |
lets round our ankles, let US See that |
we have metal enough to do it. If, |
like the Indians, We would wear orna-
meLIals III our ears and nose, let us |
see that We have enough TO make |
them. Any system in a country may
be good one which is uniform aid |
permauent; but 10 system eau be a |
good one which subjects the merchants |
TO u perpetual variation in the curren-
cy lie uses, TIE farmer to continual |
variation il prices, aud the mauufac |
turer 10 a continually disturbing force |
beween him aud his employees. Lit
US have something permanent. If We
are bent Oh hard money, let us have
hard money enough. Don't let US re-
sumo specie payments only to prove |
our folly. Well, then, what gold is |
necessary to resume specie payments? |
As to silver, that is moonshiue. At |
best, silver is only subsidiary element.
just as copper and bronze are. The
English have about $1,000, 900 in
bronze, and about SO, 900, 600 in silver,
but nobody supposes that either of
them has any thing TO do with the basis |
of value. The unit of value in En- |
lard is the gold sovereign, and an
Euglishman would laugh at you if you
contended that silver was an essential |
element of English currency, and a
Frenchman would hoot at you. Gold |
is the real unit of modern values; and |
every debt the government of the |
United States owes will be paid in |
gold, no matter what party is in pow
er. Silver, whether monetized or not |
(and 1t Is really of little consequence,
will be only subsidiary element of no
great power.
We come back, therefore, to the
original inquiry - what awount fgold
is necessary to rrsuine specie payment
permanently We have given the sta
tistics of the leading banks of Europe,
including the banks of England, France
and Germany, and what do they show?
Certainly something very differnt from
what this country has ever exhibited,
and yet something which this country
must show if it is to maintain specie