Ottumwa weekly courier. (Ottumwa, Wapello County, Iowa) 1872-1899, 1878-09-25
Q-What was the cause of the pan

Q-What was the cause of the pan
ic.
A-The abuse of credit. The az
tivities called out by the War and the
issuing off paper money produced a
delirium of enterprise, or, perhaps,
more properly speaking, mannfactur-
ing and trading activity, which has
reversed with remarkable distinct
ness and power the law of compensa-
tion, which governs in all things.
The abuse of credit is what has
brought upon both Europe and
America the commercial revulsion of
the last few years, aggravated there
as here by the imitation of the curren-
cy.
Credit became as cheap as dirt. As
every dollar Of our circulating me-
dium must be redeemed by one of in
trinsic value, 50 every promise must
be redeemed by doing the thing
promised. destroy confidence in the
ultimate redemption Of either, and il
is itself destroyed.
The people suddenly awoke from
their delusion, and then we had the
panic.
That, for all any of us can see,
things might have gone on for ten
years more as they had done for ten
years preceding 1879 is certain ; but
that the longer the day of settlement
was put of, the more suffering IL
would cause is equally certain.
We are settling our accounts for a
new departure, is the meaning, and
the whole meaning and cause Of the
panic. 1t was and is no "panic," hut
a rational adjustment Of affairs. Ii
is simple settlement Of balances, the
adjustment of bankrupt promises.
This period of settlement involves
the happiness OF all classes without
exception, but it has fallen with crush
ing force or that class who have here.
tofore been capitalists. There ia and
has been no destruction of property ;
the country has actually increased In
wealth and power during the last
four years, but the amount Of proper
ty distributed in the interests Of the
mass of the people, and substantially
to them, is immense almost past
comprehenson.
estimate the losses to holders OF
what is known as first-class securities
such as first mortgages, etc, to be ful.
fy 10 per cent, and of all other &C
called securities and stocks 40 pei
cent. and on real and personal prop
erty 33ts per cent. On the govern.
ment debt the holders have practical.
ly lost about 20 per cent. for the hold.
era of government bonds could dc
nothing else with the money paid
them other than re-invest in four pei
cents.
They have practically surrendered
6 per cont bond for four per cen
bond, tho 4 per cent bond being worti
to them an income one-third lesl
than the one exchanged for II.
If any are disposed to question th,
correctness of the assertion that /
very large part Of this immense sun
has been distributed, let them remem
Der that probably one-third OF II rep
resents the wages paid laborers fol
building and equipping railroads
public Improvements in towns, coun
ties and cities, houses in cities ant
towns, the improvements in farm
etc.--causing . large increase in al
the trade and industry In the countr,
for the time being.
The accumulAtions Of the abuseS
bondholders was parted with TO
these evidences of debt before 1878
and the money then went into tn
whole circle Of the industries of tn
country, and the destruction of tn
bonds. and other evidences Of deb
then, leaves it never to be collected.
Take railroad costing one hundre,
millions, built to transport coal, tn
net receipfs must be kept up to sever
millions to meet the interest ON its cos
each ton of coal that iscarricd owe
it is taxed In the form Of freight
which is paid by the consumer.
In the universal settlement of bal
ancea, or the general settling Of value
whichever term we select, the railroa,
now stands at twenty millions; tn
net receipts now need be only 3l,4OO
GOO to pay the same rate Of dividend
and the tax on ton Of coal to tn
consumer In the form of freight,
perpetualiy reduced four -fifths, whic
to the lab0ring man, as to others,
the equivalent of investing to hi
credit sum sufficiently large to pa
this difference in freight on his Goa
and SO on through the whole list q
evidences of debt that have been de'
troyed.
i Q.-Are We to have these panics i
the future IS we have had them Ca
they be avoided?
| A.-Nothing will prevent "panicl
until human nature is RADICAL