The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1878-10-03
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@ fSTEREsrsNa AND vAI.ua DLE eoHaEsP0 ONT
RScE aR. BL4iNE's OBJECTIONS 10 MR..
paLLfps,s PET soIEME.
Boston, september 1B, 1879. Hon. SamesI.
Il. Blaine My Dear Sfr, P lease TO reInenl-i
ber our task fiji the Senate chamber last WIN
ter. when / urged that the Republican party
should meet the wishes 81 the people, the
necessities OF business, and the convictions
OF d large portion Of the thoughtful men OF,
the nation.
ii your party had offered q plan TO the
Governments Issuing OF oil paper-note cur
rpncy IA doctrine to which the best Eu-
ropean thought is fastening, Ii 1t has not
already reached it), the same to be ie9ai
tender everywhere and for every purpose,
and intercoDYertible with bonds Tor long
term and at low rate OF interest, the prln-
cipa! and interest OF which should De pay
able in coin, that would have saved US l y
the Bourbon South in 1880.
what T hear from Republican business
men conyiuces me that If they could have
been countenanced in such platform by
trusted leaders, such leaders would nave
carried the country. do not say that sncn
n financial plan would have wholly satisheo
me, but it would have held the country.
TT is sad to see party which has lea Inc
world In advanced yet conservative opinion
quit its place and fall behind the best man
ctal thought of Europe, clingng to oDSolete
il not exploded theories, losing the helln III
defence OF ideas that ten years henee men
will smile at. One great concern Win lhe
is that they thus insure southern BOURBON
rule for the next dozen years.
Wealth here is almost omnipotent and its
organization Is very perfect, but you'll see
that. once awake, the masses Will smash
rings. iourpals, and parties, and that neither
wealth nor the seaboard rules this people.
Ynnrs truly, WENDELL PHILLIPS.
AUGUSTA. ME-, September %, 1873
Wendell Phillips, Esq: My Dear Sill
remember the conversation in the Senate
chamber to which you refer, and beg TO
recall to you-possibly more fully than
then stated-the objections to the intercon-
yertible bond as the basis OF our currency.
am aware that many wise men 0esides
Yourself have approved and advocated TINS
theory, The power to hold bond when
NAV at any moment be converted into legal
tender notes for it's face value, and to have
leeaI-tender notes which may at any mo-
ment be converted into bond at par, APP
pears at first sight attractive. But no scheme
is more deceptive or more deluslve, ana
will briefly state the objections which seem
to me insuperable.
OBJECTIONS TO THE SCHEME.
First, II the bond be of sufficiently high
rate of interest to float the currency even
to an approximate equality with coin-say
four per cent. or thereabout-the inevitable
tendency will be for the currency to run
into the bond rather than for the bond tobe
exchanged for currency, and this with such
force and volume at critical times as to COM
pel a scarcity OF notes, an ever-recurrlng
stringency in the money market, and gen.
eral instability in affairs.
Second. II you make the bond OF rate
so low as to avoid the tendency and the
danger Just stated you, OF course, abandon
all idea of having your currency at par with
coin, II your interconvertible bond IS
worth but seventy-fye or eighty cents on
the dollar in coin, you thereby Tx the value Oh
your currency at twenty or twenty-five per
cent. below par, and you Danish coin from
YOUR circulating medium absolutely and
finally. So that if your bond be one that
will float currency at par with coin it Will
steadily and irresistibly tend to contract its
volume. And if you seek to avoid this re-
suit by lowering the rate OF interest on the
bond YOU render equality with coin impos-
sibIe. In either event the scheme would
work its own destruction, swift and sure.
Third. No device was ever conceived that
would give a more complete advantage to
unhealthy speculation of all kinds than the
bond. Several times with
in the past ten years we have witnessed
"lock-up" Of greenbacks by Wall-street
combinations, with view to financial ends,
which were ut war with the public good.
So promising and so profitable were these
ends that the spectators could afford to
have many millions Of greenb backs lie idle
in order to force stripgency in the money
market. Your interconYertlble bond would
open the way for this class Of financial ope-
rators to .slock-upN. greenbacks and have
the Government pay them interest on the
whole amount, while they might be con-
spiring to derange the business Of CONT,
nent, and depress he.value Of every farm
er's crop in the land. In other words. your
theory would force the Government to be
an accompllce in every gambling scheme
devised in Wall street against the peace and
prosperity Of the country. :.
Fourth. Every year, rs the spring Dtlsl-
ness closes and summer comes upon US,
there is a vast accumulation OF money thus
lies idle for three or four months ut the
financial centres; in the vaults OF the
banks. in the safes Of capitalists, in the
treasures OF railways, and in the strong
boxes OF insurance companies. During
that period-nearly one fourth OF the
vear-there are from one hundred and fifty
TO two hundred millions OF idle dollars in
New York and other great money centres,
and these dollars all belong to rich men.
Your interconvertible bond would pro vide
an admirable mode for these capitalists to
take large amount Of interest from the
Government at q season when they cannot
get it from any other source. But ques-
tiou whether it would be quite fair to tax
the whole people during the hot months OF
summer in order to~insure to the wealthy
capitalists Of the country a good income
on that large sum Of money which would
otherwise be idle while they are enjoying
the mountain air and the sea breeze.
Fifth. The interconvertible bond would
lead to postponement in the payment OF
small bills and debts in the domestic bust
ness OF supply in everyday life. In our
present system large sum OF money is car
ried at all times on deposit without interest.
When bills are presented from the "butch-
er, the baker, or andlestick-maker," the
man baving money on deposit not drawing
interest readily pays them, for there Is no
profit to him in putting Off his creditor.
But once teach every man who has q sur
plus OF ready money that he can deposit
it with the Government and draw in
tcrest thereon, and the inevitable ten
dency is to place it there and keep it
there rs long as a creditor can be denied,
avoided, or evaded. The advantage in all
branches of trade and labor of promptly
paying small bills, not drawing interest, is