Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1878-07-29
Bank Notes Versus G5ccnbacks.

bank notes and greenbacks Is one that Is
considerab discussed. 1t is distinct from
the question OF specie payments or incon-
vertible paper. Ghe democrats of Maine
declared in their platform in favor of
greenback currency to the exclusion Of
bank notes, the greenbacks, however, to
be redeemabe in coin. Now surprising
it is agreed that conyertibilty with coin is
essential to the safety and stability of any
currency, the New York Times presents
the argument for each kind OF paper as
follows:
"ConvertibiIiy WITH coin is essential to
the sal, t. and stability OF any paper cur
rency. Starting with that as "A settled
p lit, and admitting that credit is to re-
naih in some measure at the bct,om of the
currency, that is to say, that coin is not 10
be kept constantly on hand for the redemp-
ton OF every dollar In notes. but that album
dant resources and ample security are sufll-
cient to assure convertibility, is it better
Tor the government to issue the notes or for
the national banks? II is claimed that the
credit OF the government is less liable to
sudden shocks or to chronic weakness. and
that its resources are practica Is without
limit on account OF its power of taxation
upon the property OF the people. 1t is
futler said that the process o. putting its
notes in circulation is expensive while that
of issuing the bank-notes is costly. The
cost OF the latter is reckoned as the inter-
est OF the bonds pledged for their security
md tle discount charged upon their first
issue from the banks. The former of these
items is real, to the extent OF about nine
tenths OF such iuteiest, if we suppose that
the issue OF greenback, in place of the
Uanknotes would result in the liquidation
OF an equal amount OF the bonds. The
latter item, that of discount in issuing the
uotes, is imaginary, inasmuch as they
represent so much capital sunk in the Sc
curity. and the discount is a Legitimate
charge for the loan OF credit There is.
then. certain amount OF cost to be
charged against the national bank-notes.
and offset by some advantage which it
pays for What is this advantage
The proper volume of currency can only
be determined by the exigencies of COM
merce, and should be under the control of
the bushes community. 1t cannot be safe
y let to the Government, and esp acially
to the caprices OF legislative power di-
rected by so little wisdom as the American
Congress has lately shown on the subiecl
of finance. With the banks il is not de.
termined by the arbitrary will of Direct
ors, as is sometimes alleged, but like
every other matter of supply aud demand
by the profits of business. With the OBJ
legation TO redeem in coin. or for the pres.
ent we viii presume either in coin or in
redeemable Government notes, the vol
ume would be determined from time To
line solely by the profit of issuing them
under that obligation, which would cores
p md closely to The wants of trade" or
the quantity that could be proftably used
This result could not be attained bv any
Government machinery, and the contin-
lal tampering to which the currency
would be liable, and even the agitation of
questions of expansion or contraction.
which would be inevitable would ind
rectly occasion LOSSES compared to which
he direct and definite cost of getting
hank-nptes into circulation is the mere.t
1agatelle. The pledge of bonds, exceed
ing Ivy onehinth in amount the issues of
notes, affords an ample security, and. with
he obligation OF the Treasury to redeem
# the banks do not, gives to the system
the full benei OF the G Government credit
Besides this, the capital and resources OF
\ banking association are Il definite thing
covering it, liabilities, and Immediately
bound under law, for their security. The
government resources, commanded hv
| the power OF taxation, are an indefinite
thing, subject to the will of Congress and
the influence Of politics. Currency is an
| instrument OF commerce, and should be
supplied by commerce, and the business
and industries Of the p ople should be as
tree as possible from the disturbing and
deranging Interference of Governmei t.n
At Springfield Mrs. Parington sadly remarked
that she had had toothache "for three successful |