Daily globe., 1878-09-13

The second form of paper money depended
solely on the capacity of the bank to redeem in
COIN. say solely because. althoug b there were
many expedients devised to give ultimate
cnrity I" the note. holder, yet, if the bank did.
in fact. refuse REDEMPTION over its counter,
panic ensned, the notes deprecated, they lost
their currency, and were finally either scaled
or totally repudiated paid to spectators
who had bought them at low rates. Without
single exception. SO far as I now recall. the
honest note-holder who received them in busi-
mesa lost largely.
lnex"rable as human greed, enjoined an issue
OF these notes. PAYABLE on demand in coin. in
the proportion of three to one in coin. The
bank never could redeem all its notes in coin.
Its capacity tn make money depended on the
fact that it could not. Every pers IN who " ould
think or learn from his daily experience knew
that it could not.
THE SYSTEM WAS 4 SHAM,
deceit, a fraud; it was lie on its face. It
was saved from criminality only because the
law allowed the sham to be perpetrated. 1t
was fraud allowed by law. sustained by Gus
tom. and practiced upon the whole community.
This currency was founded upon a confidence
which always failed when it was {, eeded-upun
strength which existed only when there was
no strain-upon a power to perform only when
no performance was required.
This was the currency which crushed the
poor, which beggared the Industrious, which
wiped ont the meagre savings of the unfortu-
nate. which cheated daily labor of it's daily
bread, which 'watered the rich mans soil With
the sweat of the poor mans brow" which Web
ster SO eloquently denounced and Jackson SO
intensely hatcd
The third class is
OUR eREENBAcK PAPER MONEY.
1t has actual value. It is not merely or chiefly
promise to pay. Ito value is measured not
by the labor necessary to make it, but by the
capacity and function which the law gives it..
1t does pay taxes; it does pay dests; it does
purchase every necessity and convenience and
comfort of life; it passes readily from hand to
hand at value SO uniform that no man loses
by it; it performs the highest and chief func-
tion of all money; it effects exchanges of pro-
perty. 1t is SO interviewer with our whole in
dustrial system, that whatever men may have
Thought of its constitutionality or original ex
pedency. the wisest of its opponents sec no
present means of dislodging it without shock
of disaster. Secretary Sherman linda it an es.
sential part. even the foundation of our cur
rency. Another proclaims it the idol of his af-
fections, and every Republican orator in Ohio
exhausts his vocabulary in it's praise.
THE RA6-BABY
has become an honored and honorable child OF
the household.
But alongside of this paper currency. sc
good, 70 valuable, SO worshipped by our Re
publican friends. is the national bank curren
cy. 1t is hybrid between he old bank cur,
rency and the greenhacks. The notes are ulti
mately secured by United States bonds, in the
proportion of 100 per cent. of 80 per cent. OF
notes. l freely admit that the security of the
note holder is better protected, and the circula
ti"n of the notes at uniform value over the
whole country is better effected, than unde,
any former system. This currency is not legal
tender. Its value depends primarily ON the
capacity of the bank to redeem its notes il
legal tender; and the bank is never required te
have more than 25 per cent. on hand. 1t is is
sued by 1000 National banks. under the So
pervision of one officer appointed by the ad
minstration in being, holding in his hands th'
thread of system controlling directly five
hundred millions. and indirectly
BILLIONS OF CAPITAL.
and touching the pecuniary interests Of hun
dreds of thousands of the people. The afhliatior
is close, and the combination is powerful. Th.
chord Of q common interest unites them, end
the shock is uniform and electrical
There are three hundred and twenty-five
millions OF these notes in circulation. TIE,
are secured by more than three hundred anc
fifty millions of United States bonds. Th,
dujouuO III ClECuldblOH our hepuOllCan frlon0,
love to tell us, is liked under the free banking
law by the real, true wants of trade There
fore SO much currency in addition to the out
standing greenback-three hundred and forty
seven millions-cau be maintained without in
hation, which SO alarms them, and without dis
turbance OF values.
The three hundred and fifty millions O
n bonds bear an average of ~ per cent. interest
The banks, therefore. draw from the govern.
ment-that is, from the taxes paid by the peo
ple-nearly sixteen millions of dollars on th
banking capital used in circulation. Tht
banks pay taxes on their circulation to al
amount less than three millions.
THE DIRECT MoNEYED COST,
therefore, to the people of the bank currency i
5l3,00O,0 600. year.
The Democratic party says: 'Wi:hdrav
this bank circulation, issue United States note
in their stead. Do it gradually. so as to pro
duce no shock; do it carefully, so as to sacri
tice no interests or rights. Buy up with thes,
notes United States bonds at Their msrke
value and cancel them. and save to the peopl,
annually the interest. This produces no shock
works no I'M nstice, provides better currency
produces no initiation, lessons the taxes of th,
people, and gives them the money beneiit o
the credit of their government. which. afte
all, is the only support of the bank currency
THE ARGUMENT IS coaENT,
why Should it not prevail? It is admitted tha
we must have, and that it is great positive
benefit that we should have S}l7,0Oo.OO0 OF
United States notes outstanding. Why no
have all our paper money of the same kind
especially it 1t is more economical for the pen
pile? Will it be less valuable. less free of cir
culation? Will it he more onerous to the gov
ernment? Will it he more fruitful Of privat,
disaster, or of public demora ization, or q
nd l;+;ool ;.Q, 4
IT.. Again. ask. why should it not prevail?
Mr. Sherman, as If in answer, says: ''Wh,
stop at 1922 00b,000-why not issue enough
notes to pay the whole public debt, and saw
all the INTEREST,""
STOP! STOP! MIR. SHERMAN!
You are playing with edged tools; that argu
ment may be pressed SO vigorously by sufferin.
industry and starving men, that you will no
make it the subject of fippant joke. For tn
present, we hold you to the position. We d.
| not intend to let You escape on any feignet
| issue-we do not intend to let you alarm sensi
tive souls by any false cry of imitation or re
greenb backs for bank notes without increasin,
the currency. or sacrificing rights
Time enough for all other questions after
| ward. Are you i, favor of it? If this is you
only answer, it is both evasive and weak.
MIR. Sherman says, and Mr.. Garfield enforce
tuC OOJcCGlOu ttIdU
CONGRESS CAN MOI BE TRUSTED
to regulate the volume of currency. Why not
Congress declares war; makes peace, levies tax
es. arranges tariff duties, borrows money, regu
lates commerce. affixes the death penalties; an,
yet can not be trusted to regulate the yolum
# currency lest it may yield to popular de
mand. II may not be the very best depositor
| Of the power, but with what grace does such al
! objection come from those who claim, wit
Mr.. Sherman, that he has and should have tn
power to regulate the volume of greenbacks &C
cording as he thinks the necessities of the re
sumption scheme demand.
Mr.. Sherman says the bank-currency system
is an aid to the resumption OF specie payments
How? Only by compelling the banks to re
deem in grcenbacks, and for this purpose com
peiling them to keep on hand reserve fund o
greenbacks. That is to say, the governmen
will cut this thing very fine; will compel th