New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1878-01-15
WILL THE SILVER BILL HELP M4NUFAC-
TURERS?

and of other Senators who represent States
mainly engaged in manufacturing, Is invited
to n consideration of the effects of the pend
ing Silver Bill. That this bill will not raise
but will probably deprcss the price Of silver,
and thus will fail to help silver producers, has
been shown. That it will expose the banks to
extreme peril, and thus will compel them to
resort to extreme measures for their protec-
ton. has been shown. Many do not yet
realize the danger. Should the bill pass, gen
cral refusal to make loans otherwise than pay
able in gold will be the necessary conse-
quence. What effects are manufacturers u
eXpect2
a very largo number Of them are in debt.
Four years have been very hard on them ;
many have failed; many are still idle; those
who can work at all are forced to calculate
~pon the smallest possible margins of profit.
! The least possible risk is necessary to their
/ existence. Their business obligc5 them to
| borrow continually, to carry stocks and labor
! from the beginning of production To the pay
ment of notes for finished and delivered goods.
! No other class is SO greatly dependent upon
| stcadincss of currency; for the merchant, though
/ he may borrow relatively more. can turn himself
more quickly. and stands the risk of change for a
| shorter time Dependent upon credit, if the
/ time comes when a great fall in the value of
! currency threatens ruin to the banks, what
can the manufacturer do Loans will become
scarce, and very haid to get, unless he pledges
| himself to pay gold value. If he does that,
I he takes ar the risk of the possible decline
upon himself. Prices of all goods vary more
| slowly than prices of fluctuating currency /;
he must buy and promise to pay in dollars
worth nincty-sevcn cents, with probability
that dollars when paid to him, will be worth
not more than ninety cents. What will be-
come of his narrow margin of profits
| If prices would advance swiftly, and an era
Of imitation begin Mt once, he might hope, pro-
yided consumption would not be checked by
! financial uncertainties and the advance of
prices. But nothing is more certain than that
consumption would bc checked. Thousands of
buyers would be pinched by the alarm of lend
crs and the inability TO borrow. Railroads
would seek in vain for money with which TO
buy rails or cars cities and towns would seek
IN vain for money with which to continue
public buildings and improvements thous-
and, Of individuals, firms and corporations
dependent upon new loans or renewals for
means To continue operations, would be forced
to restrict purchases. The falling of leaves
when frosts of Winter come is not more in
cyitabc than the sudden stagnation of all en-
tcrprscs which depend upon borrowed capital,
whenever war against lenders threatens their
safety. None who have means to lend could
then look with confidence to the future; there
fore none who do business with borrowed
capital could count upon renewal of loans /;
! Il and
purchases must be checked. The manufacturer
with slender margins and heavy debts, with
credit everywhere shaken and purchases
| checked by disturbance of the very basis of
all commerce and crcdit-what will be his
fatci
Disturbance of credit always means with
drawal of capital from all sorts of enterprises
and undertakings. II Congress passes the
Bland BILL it cnacts that disturbance of credit
panic many times worse than that of 1873,
shall begin at once. There are means by
which the banker or mOncy-lcndcr may check
il and limit its effects rs TO himself but upon
whom, then, fall the risk and the loss I In
/ cyiaby the manufacturer will have TO bear
the largest share. No other branch of indus
/ try is SO greatly dependent upon stcadiness Of
commercial credit and ready supply of loan
able funds and rcdt-earthquake, which
means mischief for everybody means ruin for
manufacturers.
The experienced and ahrcwd men of every
manufacturing State, with possibly one cxccp-
! ton, see this clearly. Pennsylvania is the
only State, largely engaged in manufactures,
| from which vote in the Senate is expected
| 10 be- cast for commercial earthquake. 1t ia
the only such State in which there is trace Of
| public opinion favorable to the Silver Bill,
with all its risks. Yet that State ought to he
| the very last to forget what ii has lost by The
disturbance of credit in 1873 No other has
suffered relatively rs much, because no other
! State depends in its main industries so large
! " upon commercial credit. The cost of iron
| has to be borne from the very opening of the
mine, and the erection of expensive works, I'M
! til months after the marketing Of products, and
! the demand for iron Is controlled by the
readiness OF capital to build. extend, improve
or sustain railways. The vast coal-producing
industry of that State depends upon the same
conditions. The great corporations of the
State are all ccnspicuoQsly heavy borrowers,
and are bound also for the obligations of
hundreds of corporations which are kept alive
in these hard times by credit. If there is
any State in the Union which is certain to lose
more than any other by great disturbance
of the credit system, that State is Penn
| sylvania and yet one of its Senators openly
favors, and another is represented as willing
to vote for, bill to threaten every bank, every
savings bank, every insurance and every trust
company, and to compel them to call in and
readjust their loans as fast as possible for their
own protection.