The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1877-04-30
Eject or tho European War ON Amer
lean Business and Finance.

i
1t is always well in attempting to form a
correct judgment on any subject to survey
| it on all sides and from different points OF
view. General Butler. in an interview
printed yesterday in the Sun, dissents from
the general opinion that the war in Europe
will contribute to our prosperity. General
Butler is one of the most astute and
active-minded of our public men, and
on question which has been as
yet SO little discussed we are not
warranted in rejecting his opinion without
examination. The country cannot afford to
be the dupe of its hopes, and any man is
| benefactor who saves it from SO serious an
error. On the other hand, if General Butler
is wrong, something will be gained in clear
ness Of view by exposure OF his mistakes.
| His mind is under a we'll known bias on
| financial questions, but it does not follow
that his greenback crotchets disqualify him
for reasoning correctly respecting the effect
of foreign war on American prosperity.
General Butler does not dispute that the
immediate effect of the war will be to en-
nance prices and increase our exports, but
he thinks this will be Offset by consequences
that will make it a doubtful advantage. He
is reported to have said:-"I apprehend a
little different effect in this country from it
from that entertained by some of tho press.
/ don't believe it will help us much. True,
it will send mp the price Of breadstuffs, pro-
visions, leather, vessels. materials, &C.; but
your laboring men, now at simply support
ing pay. will have to get higher pay in order
to buy -four and corn. That means an in
creased price for labor, and when that comes
again our manufacturers cannot compete
with those of other lands. That will be one
effect Watch things and see lift isn't. Then
there's another. Therell be demand in
Europe for gold. They'll pay more for it
there than it's worth here, and our stock
will 60 there. That means higher price for
gold, and the greenback, which is payable
in gold, will go up too; or, in other words,
property here will depreciate still further
How are we going to resume specie pay
ments--pardon me, gold payments-in 1879,
under such circumstances? There is little
cloud no bigger than mans hand here
now, but it will be big enough pretty soon.
Something has got to be done, and the peo-
pie won't stand fooling."
AS regards the effect Of the war on our Ia
boring classes General Butler is partly right
and partly wrong de does not dispute
that it will raise the price of commodi-
ties; indeed, this is the very basis
of his argument He thence draws
the iuference-a perfectly valid inference
that it will increase the cost of living and
render the wages of labor less efficient for the
comfortable support of families. But this
view is too narrow; it includes but mere
corner or fragment of the subject. 1t is
true of all prosperity that it adds to the
cost of living but did any community ever
consider enlarged markets and high prices
an evil on that account i? High prices,
by stimulating production, give full
employment to labor and when that
large class of our industrial popula-
ton which has SO long suffered and
languished from enforced idleness is able
to earn wages the condition of the laboring
class as a whole will be greatly improved.
Besides, wages are sure to rise in condi-
ton Of general prosperity rs soon as the de-
mand for labor begins to outrun the supply.
But there is another consideration of great
weight of which General Butler quite over
looks the proper bearing. We refer to the
early resumption of specie payments,
which he thinks the war will render
impossible. On the contrary, immediate
resumption is the proper and efficient
e kho
to the laboring classes which General Butler
seems to dread. If we resume prices will
be kept down to the specie level, and the
wages of the laboring classes will 60 further
in procuring them the necessaries of life.
There will never be better and safer time
to resume than when prices have strong
upward tendency owing to q large brisk and
permanent foreign demand. The chief reason
why resumption has been such bugbear
for the last ten years was its apprehended
effect in depreciating the value of
property. There now comes suddenly
condition of things which is certain to
give buoyancy to prices and carry them up,
and if our government is sagacious enough
to seize this favorable opportunity and re-
sumo at once the effect Of the change will
be imperceptible. Resumption alone would
depress prices, the war alone would raise
them to great height; but if we resume in
the midst of this strong upward tendency
there will be considerable advance on the
whole and resumption be attended with
no shock. Our government will prove
itself an incompetent financial pilot
if it does not float the ship over the
bar on this rising tide Of prices. We agree
with General Butler that something has
got to be done" ut the approaching extra
session, and in our judgment the fit thing to
be done is to enable the Secretary Of the