San Marcos free press. [volume] (San Marcos, Tex.) 1877-1892, 1878-06-08
Peter Cooper and John Sherman.


The replies of John Sherman to the
series of questions put to him by the
venerable Peter Cooper show more con-
clusively than anything that has yet
in favor of forced resumption. The
first question put by Mr.. Cooper reads:
Can you resume in the presence of S645 00Q, :
90 legal-tender and bank notes with what gold
and silver you may have at your command With
out an actual shrinlage of this currency either
on the paIt of the Government or the banksi"
To that Mr.. Sherman replies, and we
ask particular attention to what he
says:
You must bear in mind that the aggregate
amount of legaltender notes and Tank notes
stated by You may be gradually Diminished, 40
0000OO, and by the banks to such sum as they find
can be maintained ut par with the United states
notes. But assuming that the aggregate should
be about tn prt sent amount, and remembering
always that the bank notes tan he redeemed in
legal-tender notes, and are not required to be re-
deemed in coin, do express the opinion that re-
sumption in country Ike ours can be main.
circulation, hut if this should prove 70 be too
great the reduction will he gradually Of the bank
notes Or If Congress SO direct of the lesal-ten-
Let us take that apart and see what
IL amounts to:
l. That the Greenbacks may by law
be reduced from their present volume
($346, 900, OOO) to $500, OOO, 900, so that
the Government will only have to make
provision for redeeming the latter
amount.
2. That the National Banks will have
to redeem their own notes, and not the
Government for them. That, while be-
ing true, will not lessen the amount of
coin necessary to redeem over six hun
dred millions of paper; so that the
Government will not be relieved par
ticle by the fact that the National Banks
will have to redeem their own notes.
Certain, anyhow, that the people will
not be relieved from the pressure caused
blythe requirements of the Government
and banks for coin with which to re-
deem. The idea of Mr.. Sherman seems
to be that, because the National Bank
notes are not necessarily redeemable in
coin, but in legal-tenders, the stock of
coin to be held for resumption pur-
poses need be only large enough to
secure the prompt and sure redemp-
ton of all the Greenbacks that may be
presented for redemption. He does not
see that every National Bank thereby
becomes an agent for its depositors and
note-holders to gather up Greenbacks
for the purpose of getting coin for
them; for it must be remembered that
the National Banks must redeem not
only their notes with Greenbacks or
coin, but also their deposits, which
amount to twice their circulation; so
that, instead of the Government and
the banks being required only to have
on hand coin with which to redeem
S645, 100000 circulation, 81 ,245, 900, 900
must be provided for. How is that sum
to be met? Mr.. Sherman says:
g. But if this should prove to be too
great, the reduction will be gradually
of the bank notes-and he might have
said of bank deposits, also-or, if Con-
grcss so direct, of the legal-tender
notes!
Contraction is, at least, the first ref
uge in case the difficulty of maintain
ing resumption becomes pressing. In
reply to Mr.. Cooper's third question,
Mr.. Sherman says: awe have only ar
rived at our present position approach
ing specie payments by the accumula-
ton of coin in the Treasury, and by the
gradual and slow reduction of the vol
ume of notes; and the very measures
which have enabled us to reach so near
the specie standard are to be continued
10 enable as to maintain resumption.
The italics are ours. Coin and paper
have been brought so near an equality
by the Government going in debt and
the contraction of the currency, and
resumption can be maintained only by
q continued sale of new bonds and con-
tinued contraction of the currency.
But even that may fail to maintain re-
sumption; what thenp The final resort
suspension. So says Mr.. Sherman
in his reply to Mr.. Cooper's fifth ques-
ton. He thinks it is undoubtedly the
duty of Congress to provide for the pos
sible contingencies that would make it
necessary to suspend specie payments"
etc. "What born for, if to be so soon
done for?" Cincinnati Enquirer.