Green-Mountain freeman. [volume] (Montpelier, Vt.) 1844-1884, 1878-11-13

the four principal commercial countries oil
the world, as follows;
Circulat'n. Popuat'u. Amt per capita
Frarca sl6J9h .OOJ 36.yO5.7s3 Sl.4s
iInfd K,.rdom, 2iSs65,OOJ s3474WO 639
Germany. lis Ol5OQo 43727,@o so
United States, SIS .5sl 275 47.0O.OoO H.6S
In the United States, in addition to the
above, there were nearly thirty-three
millions in gold certificates outstanding
which, in the transactions of the custom
house, and doubtless in other ways, served
all the purposes of paper money These
figures show quite conclusively that there
is no absolute necessity for the large
amount of paper money used in this
country, rs it ought 10 be apparent that
paper money is no more necessity here
than in England and Germany. Business
is carried on to advantage and without
complaint of scarcity of currency in these
countries, and what is possible there is
possible here. France is getting back
from the paper money era of her war; and
has nearly one hundred and fifty millions
less now than in 1878, and has in the
meantime increased the metallic reserve
in the Bank of France (Which alone in
France can issue paper money! from
SAG, 900, OOU to 100000, an amount
almost equal to the volume OF paper.
1t was stated in former article that
there seemed 10 be no sound reasoning in
support of paper money that did not ac-
tually represent. dollar for dollar, real
money. The only excuse for paper money
at all is its convenience; it has less
bulk and less weight than coin; and coin
being the standard of value, paper dol
lar, like gold certificate, should stand
only in place of the coin. 1t should not
be IL promise to pay, in the sense OF beng
merely evidence of debt. but rather
certificate of special deposit which must
be kept 10 redeem the certificate when
presented. The invention of any other
paper money than this has always been
the work of those who proposed in some
way to get something for nothing. The
old state banks in Vermont, for example,
we're set on foot rs matter OF specula-
lion for those who owned them, and not al
all for the benefit of the people. They
were allowed to loan pieces of paper that
cost them next to nothing at six per cent
annually on their face value, and it was
called money, and the state supervised
the Job, but the corporations took in all
the profits. Governments have, from
time to time, issued paper money, but
usually,-as was the case with the legal
tenders-as n means of making forced
loan, and because they had no real money.
The authority of the Bank Of England to
issue bills is matter of speculation for
the stockholders of the bank, to the ex-
tent that the circulation is based on what
the government owes the bank, or about
S7O,OO0,0 900; the other $4,000, 900 of en-
culation being based on coin OF bullion
actually in the bank. On the first S70,-
900 1000 the stockholders of the bank, %
course, get double interest, once of the
government, and once of the public who
use the bills Our national banking sys-
tenn is, to the extent of the bank note cir
culation, privilege of the banks to get
interest twice on the same money, once on
the government bonds, and once on the
bank notes, the government only sharing
in this speculation with the banks by
taking II small fraction of the profits in
taxes. This privilege, however, was not
granted because of any real want of more
paper money, but it was given as an addi-
tional premium on government bonds,
practically Offering along with them
the use of Il currency equal to ninety per
cent of the par value of the bonds. That
this currency is used is no evidence that
it is needed, or that it is beneficial in COM
mercial transactions. Men are much given
to borrowing money rs long rs they have
credit and engaging in all sorts of enter
prises, as often improbable rs profitable
and associations that have money to loan
stimulate this tendency; and it only adds
still more to the overgrown structure Of
credit where fortunes are made on paper
and sharp men get rich by loaning mag
mary capital Men in Wall street spend
a lifetime in specializing in stocks, are
rich to, day and poor tomorrow, and gen
orally end in bankruptcy. but theil
brokers make fortunes out Of the commits
sons paid them; and great deal of the
credit system is much the same in char
acter, especially where it is based on this
manufactured money that costs nothing
but brings in its interest all the same; the
sharp lender gets rich while the borrower
often settles with his more confding cred.
itors through the bankruptcy courts. Sc
far us the opposition to the national banks
is based on their being allowed to loan, as
money what ought not to be made money
and costs them nothing, it has logica
ground TO stand on; but the objection may
well go further, and condemn the issue O
anything as money that does not repre-
sent actual coin. The proposed paper
money, exchangable with government
bond, has certainly one advantage ovel
this bank note currency; it is not issue,
for nothing rs bonus or premium t.
somebody, but must always represent a,
annual cost equal TO the rate of interes
on the bond exchanged for it.
There will be always, however, tb,
| temptation to make profit out of any issu
of paper money that is not represented b,
an equal amount of coin on deposit; an,
while, if any sucl profit is to be made
the government, Chat is the people asl
whole should have the benefit OF it, it
better for the steadiness of business, tina
no such profit should be made anywhere
While it is profitable to issue it, there will
be continued inducement to make tn
issue greater in order to increase the profit
and legislatures and congresses are a
| cueoupti,ln TN ihiS inJnnaD,nnt no hanL.;,