The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1877-11-20
United States need.

All the great mercantile transactions of Eng
land are done bv drafts, checks and commercial
bllls, and Only per cent by the actual use of
cash. Money is just now only the small change
of commerce,
Aud how is it in this country? We have
adopted the habits of England and not If
France in this regard. In 1871, when 1 was
chairman of the committee on banking and
currency L made an experiment. 1 got the
Controller of the currency to issue an order,
naming ffty-two banks which were to make
returns We selected three groups The first
sroup were the city banks, not, however, the
Gn,eearpg-house clear banks, but the great city banks.
Ihey were the first group. The second were
the banks of cities the size of Toledo and Day.
ton, in the state of Ohio-county banks In
the third group, if L NAV coin word, Sc
lected the 'countriest banks,' the smallest
that could be fonnd at points away from rail-
road and telegraph communication. The order
was that all those banks should analyze their
receipts for six consecutive days, putting into
one list all that can be called cash. either iD coin
bank notes or coupons, and toto the other list
to put all that could be called drafts checks or
commercial bills What was the result? Dur
ing those six days $157 100000 were received
over the couDters of those tifty-two banks and
of that amount SIS, $40 600 was in cash-12 per
cent. only in cash and 8S per cent OF that vast
amount representing every grade of the bust
ness OF the banks OF our country, was done in
checks, drafts and commercial bills. Does a
country that does its business in that way need
as much money adoat among the people as a
country like France, without banks, without
savings institutions, and whose people keep
their money in boards?
What was the example of France in 1870,
The end of that year, before the war began
France had $2.1 900, 900 of paper circulation yf
the bank of France, aud S229, ,000, 900 of coin
from the same bank. Whec the war broke out
they were compelled Immediately 10 issue mora
paper, and make it legal tender. They took
pattern by us from their necessities and issued
paper until in November 49, 1873, or four years
ago next Monday, they had $602 00C 900 issued
oy the Bank of France and S145 900 Of
coln. But when their great war was over they
did what commend to the gentleman from
Pennsylvania (Mr. Kelley) They commenced
to reduce their paper circulation and in one
gear reduced it almost $100 900, 600. and in-
creased the coin circulation $120,000,000 In
the year 1876 they had pushed into circu ation
500, ,000, 900 Of coin, and retired small notes to
tnat amount. They are to-day within fifty
days of resumption of specie payments. Under
the law, fifty days from to day, France passes
again into the illustrious line of nations who
believe in sound currency; and 1 commend
to the eloquent gentleman from PennsylV
Mr.. Kelley the example of France
RESUMPTION IN ENGLAND IN 1922.
The overwhelming and fixed opioion of Eng-
land is that the Cash Resumption of Act 1919
was.a blessing aud not curse, and that the evil
arise from the resumption of cash payments,
bat fcom causes entirely distinct from that 1
appeal to every great writer of acknowledged
character in England for the truth of this prop
osition. But l will not leave it simply as a
matter of opinion. will give two or three
reasons why 1 think this.
In the first place appeal to the opinion of
Parliament itself, the House of Commons,
which is as sensitive an indication of public
opinion as England knows. When they were
within about eighteen months of resumption of
specie payments. a motion was made Cike the
motion of my friend from Ohio-Mr. Ewng)
that the Resumption Act Bill be modified be-
cause IL was producing distress; and number
of gentlemen on the floor of the House of CON-
mons made speeches OF the exact spirit of
those we have heard here on this floor within
the past week. The distress among the people.
the crippling of business, the alarm of the
mercantile classes, all were paraded in the
House of Commons and were answered by
those knights Of finance whose names have
been illustrous in English history; and at the
end of long debats on that proposition on the
11th of April, 1922, vote was taken, aud the
proposition was utterly rejected by vote OF
141 to 27. In other words, by vote of 141 to
q, the House of Commons resolved that their
act for the resumption OF specie payments was
not causing distress, and ought not to be re-
pealed, and ought not to be modified except to
make 1t more effective. But that was not
enough. Afser cash payments wefe resumed,a
motion was made by Mr., Weston in the
House of Commons in 1922 declaring that the
Resumption Act absolutely produced distress.
That was q challenge to the pubic mind of
England give1- in the House of Commons. 1t
was elaborately debated as the other was de-
bated, aud at the end of that long debate the
proposition was not only voted down, but this
was resolved in its place: Resolved, that this
Parliament of Great Britain will not change the
standard of value, DOR do the business interests
of the country require it, and that resolution
passed by 1872 yeas to 80 nays. The House of
Commons ought, at least to know something
about the condition of England.
Gentlemen tell US that the great distress in
England was.eaused by thesResumption Act, in
spite of all English thought. L commend
THESE gentlemen to such great writer's as Tooke
who, in his history Of prices in England, has
gone over this ground most thoroughly
aud fully. He says it was the Corn Law wbi h
produced the great evils from which England
Suffered in those days. A law had been passed
providing that corn, that i5, wheat, should nev-
er be allowed to go below eighty shillings per
quarter, and if it got below that figure all i'm
portations from abroad should be stopped nniil
the price got back again. In other words, Eng-
land proposed TO build Chinese wall around
the island, aud to make wheat one of the most
profitable crops in the world to raise. Under
rast ran into the business of raising wheat
everywhere The most enormous outlays 10
the raising of wheat spraDg into existence
on the passage of that law; and when they had
got very large crop started. they found that
for three special years, 1920 1921, and 1922, the
largest crops Europe ever hnew were reaped,
aud in spite of the law wheat went Gown to
$47s. Old per quarter in face of their expecta-
tioos, and it ruined all the agricultural people
of England with distress so shart, so terrible
q q ipoOs m dpStrlv the I'm sinasS of tha land
Now, before quitting that subject, beg leave
at once to put myself in the category to which
the gentleman from Pennsylvania assigned the
late Secretary of the Treasury, Hugh McCul-
loch. He read three lines from a paper of Mr..
McCulloch in the North American Review and
said that it was an example of astonishing mem
dac,ty. What was the statement that was go
ignorant or so mendacious? 1t was that every
gteat crisis in this country has been preceded
by an enormous enlargement of paper circnla-
ton. l affirm that to bs true, and challenge
controversy by any man. 1t was true 10 Eng-
land always. 1t has been true in this country.
We had great crisis in 1897, another in
1917, another in 1887, another in 1857, and one
last in 1873, almost exactly twenty years apsrG.
They are periodic and return as the result of
causes springlng up among the mass of our
business people; and they have all been pre-
ceded by an enlargement of credits, ana undue
expansion of the instruments of credits and
they have all resulted in ibe same sad uniform
or collapse.
THE POOR MEN THE CREDITORS.
now proceed to notice the second general
point that has been made here in favor of this
| bill. 1t is assumed that specie payments will
njure the debtor class of this country and
| thereby oppress the poor; in other words, that
the carrying out of the Resumption law will be
oppressive to the poor people of this country,
| on the assumption that they are the people in
debt: that, therefore, it will help the rich, who
are the creditor class. 1t is this proposition to
| which wish to address myself for moment.
deny the proposition in toto. l affirm that
the vast majority of the creditors of this coun-
| try are the poor people; that the vast majority
| of the debtors of this country are we'll to-do
| people, and in fact moderately rich. Now L
| ask the consideration of that for one mo-
| ment.
| As matter of fact, the poor man, the labor
| ing man, cannot get heavily in debt He has
| not the security to offer. Men lend their
money on security, and in the very nature Of
! the case, poor men can borrow but little.
| What then, do poor men do with their small
earnings? When man has earned out of his
| hard work hundred dollars more than he
| needs for his current expenses, he reasons
| thus: 81 cannot go into business with hun