Oxford Democrat. [volume] (Paris, Me.) 1833-1933, 1878-08-27
Concerning Greenbdcks and Bank
Notes.
Notes.
From the New York Tribune. |

not pay interest on its greenbsck indebt-
edness, and could save the intores. on
some s300,000,000 bonds for which il
might issue greenbacks to circulate in
place of bank notes" The thing is pos
sible. But is it desirable or honorable
l. 1t would be unjust to the bondhold-
er, who has a right, under solemn pledges
Of the Government, to payment in coin,
and not in paper which by that very act
Of bad faith would be still further depre.
ciated.
III. 1t would BIO unjust to the banks
which surrendered their advantages under
State laws, helped the Nation in its strait
and have taken, aud to this day help its
credit by holding. s400,000,000 Of it.
bonds.
III. 1t would violate u solemn pledge
made TO the public creditors that the
amount Of legal tender notes outstanding
should never exceed $500, 600 Many
men, in these days, make light Of public
faith. 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 life
". 1t would cause depreciation of le-
ga-tenders. AS another correspondent
admits, the bank notes now circulate on
the credit Of the banks, and 1.-THE Nation
itself, presumably Of as good credit, "
might use It's own credit and reap the gain.
But this means that the public credit
should be further strained, more heavily
loaded. If legal-tenders are below par,
they would sink still further ifmore were
issued. True, the bonded debt would be
retired, but is anyone ignorant that credit
is strained infinitely more by the owing Of
500 on which no interest is paid, than
by the owing of 800 on which the lender
gets interest regularly
V. The public credit would not only
be damaged by bad faith, aud by forcing
upon the market bonds now held by the
banks, but still more by tho fact that a
vast banking capital. now placed under
bonds to help the public credit, would then
have strong private interest to deprcciatS
it, to reap profit thereby.
VI. 1t would be unconstitutional to
make a new legal tender issue in time Of
peace. Decisions of the Supreme Court
leave no room to doubt that this would be
its judgment upon any test case after the
new notes had been issued That issue
wiped out, and the bank notes retired, We
should be left with only the present green
back circulation. Wildcat State banks
would then spring up to supply the want,
and that is precisely what many State
Rights Bourbons desire. Do the people
of this country want TO 90 back 70 the old
system of wildcat currencies, differing IN
the several States as to security and value?
VII. Even If, by Legislative packing
of the Supreme Court or otherwise, it were
possible to make the new issue stand, it
would be only launching the Nation on
tho rapids above financial Niagara
Pledges broken once, the issue of more
notes would be demanded Thencetor-
ward, until the final crash, all politics
would turn upon the question of imitation
That would furnish rallying point for all
Communists and oil rebels-all who hate
property and want ga general smash" and
all who hate the Union and want to des-
troy its credit.
VIII. Initiation means infinite jobbery
made easy Remove the barrier, so that
more legal tenders can be issued, aud eV-
erybody who wants an appropriation for
any purpose, however wild or knavish, has
only to propose new issue Of notes to
pay the bill. Then all that vast force
which perpetually seeks imitation will be
rallied to the support OF every job.
X. We're there no bad faith in the
substitution of greenbacks for bank notes,
and no injustice to bankers, and no wrong
to bondhoders, and no damage to the
public credit, and no unoonstitutionality
and no danger of any further issues, or Of
fatal assaults from the combined forces of
Disloyalty, Communism, and Jobbery, yet
even the change would not be wise. The
bank circulation has certain elasticity
The banks can keep it out only by loans,
and having their private capital at stake,
cannot afford to lend where loans are dam
gerous IF there is no legitimate use for
more circulation in business transactions,
the banks as a whole will not Issue more
If there is, they can now take out as much
more as can be safely and pro6tably en-
ployed. Thus the bank circulation tends
to adapt Itself to the real and Legitimate
needs of the country. 1t cannot be forced
into use by mere Legislative jObbery. But
the greenbsck circulation has no such elias
ticity. 1t can in no way be made to rise
and fall with the actual demand for cur
rency in safe transactions On the con-
trary, the only force powerful enough to
secure an expansion will usually be the
desire to carry some great scheme of plum
der which can pay lobbyists and bride
journals and Congressman. 1t is elastic
only where it ought to be most unyielding
and can neither contract nor expand where
there is the greatest need for contraction
or expansion.
"A Correspondent of the New Era