Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1878-09-06
Concerning Greenbacks and Bank Notes

Certain correspondents ask if We do not
"ignore the iact that the Guvernment does
not pay interest on its greenback indebted
| ness. and could save the interest on some
5000, 900 900 bonds for which it might issue
greenbacks TO circulate in place Of bank
notes" The thing i possible. But is it
| desirable or honorable?
l. IL would be unjust to the bondhoider,
who has right, under solemn pledge OF
| the government - payment in coin. and not
| in paper which by that very act of bad
faith would be still further deprecated.
3. lt would be unjust to the banks, which
surrendered their advantages under State
laws, helped the nation IN its strait, and
have taken, and to this day help its credit
by holding $500. 900, 900 of Its bonds.
3. Ii would violate a solemn pledge made
to the public creditors that the amount of
legal tender notes outstanding should never
exceed $40, 900 900. Many men. in these
| days, make light OF public faish. But We
are sorry To see that any Old Republicans
are willing to break any pledge made by
the Union to those whose loyal trust saved
| the nations lite.
1. Ii would cause depreciation of legal
tenders. As another correspondent ad-
nit, the bank notes now circulate on the
credit Of the banks, and ''the nation itself,
presumably of as good credit might use
its own credit and reap the gam. But this
means that the public credit should he fur
ther strained. more heavily loaded. Ii legal
tenders are below par, they would sink still
| further il more wera issued. True, bonded
debt would be retired, hut Ia any one isno-
rant that credit il strained infinitely more
by the owing of 300 on which no Interest
is paid than by the owing Of 800 on " hieh
the lender gets his interest regularly?
5. The public credit would NOT only bs
damaged by bad faith. and by forcing upon
tho market bonds now hell by the banks,
but still more by the fact that IL vast bank
ing capital, now placed under bonds ~ help
the public credit, would then have strong
private interest To depreclate it, aud reap
profit thereby
6. Ii would be unconstitutional TO make
a new legal-tender issue Ia time OF peace.
Decisions of the Supreme Court leave nc
room to doubt that this would bs Its judy
ment upon any test case alter the new notes
had been issued. That issue wiped out,
and the bank NOTES retired. We shJuld be
lett with only the present greenbaek circd-
latiOn. Wildcat State banks would then
spring up to supply the want, and that Is
precisely what many State-rights B1urbOns
desire. Do the peopls OF this country want
to 60 back to the cid system Of wildcat cur
rences, differing In the several States ~ to
security and value?
! Even if, by Legislative packing of the
Supreme Court or otherwise, it were pOssi-
BILE to make the new issue stand, it would
be only launching the nation On the rapids
above Il financial Niagara Pledges broken
once the issue of mUre notes would be de-
manded. TGencefurSard until the fnal
crash all politics would turn upon the que5-
tion of lnh,iion. That would furnish a
rallying point for all communists and all
rebels-ali who hate property and want a
general smash, and all who hate the Union
and want to destroy its credit.
8. lnhitiOn means infinite jIb5erv made
easy. Remove the barrier 81 that more
legal-tenders eau be issued. and every body
who wants an appropriation tor any pu.-
pose. however wild and knavi>h. has only
to propose new issue Vt notes to pay the
bill. Then all the vast force which per-
petually seeks inf ltiln will be rallied 10 the
support Of every job
=. We're there NJ bad faith in the suOsti-
tuition of greonhackS tor bank notes, ard no
injustice to bankers, and no wrong TO bond
holders, and no damage to the public credit,
and no unconstitutlunslity, and no danger
of any further issues, or OF fatal assaults
upon the combined forces of dI-lOyalty .c1W-
munism and jobbery, yet even the change
would not be wise Tho bank circulation has
u
out only by loans. and, having their private
capital at stake, cannot afOrd to lend where
Loans are dangerous. 1t there Is not lcgi-
innate use for more circulation IN business
transactions the banks as a whole will not
issue more. Ii there l., they can now
take out as much more ns can be safely
and proftably empllyed. Thus the bank
circulation tends 10 adapt ITS Il to the real
and legitimate needs OF the country. 1t
cannot be forced into use by mere lesisla-
tive j0bbery. But the greenback cIrculs-
tion has no such elasticity. Ii can in no
way be made to rise and tall with the actual
demand for currency IN satJ transactions.
On the contrary, the only force powerful
enough to secure an expansion will Usually
be the desire to carry some great scheme OF
plunder which can pay lobbyists AMI hribe
journals and Congressman. Ii Is elastic
only where 1t ought to be most uny fielding,
and can neither Contract n.r expand where
there is the greatest need tor contraction or
expansion -Nelc YOrA Tribune