The Ottawa free trader. [volume] (Ottawa, Ill.) 1843-1916, 1878-09-14

If it is the quality and quantity Of metal-as
the hard mOncyies Claim-that makes the
legal tender silver dollar worth 100 cents, why
is it that the dollar OF the same quality con-
tanning ~ grains more metal, lacks 10 cents
of being worth as much as the legal tender dol
lar?-Ottd,ra Ndtt0adL.
This Is poser which the advocates of the
fiat money craze are constantly presenting and
which they seem to regard rs unanswerable
II the government fiat can make 80 cts worth
of silver worth 100 cts, why cannot the govern
ment fiat make bit of paper worth nothing
worth 100 cts? If the fiat can add ten per
cent. to the bullion value Of silver, why can it
not add 100 per cent to the rag value ofpaper?
We admit that in principle there is no essen
tial difference between the case Of the silver
and that of the paper. To Il certain extent
doubtless the government fiat can give an artl-
fetal value to both above their intrinsic value.
So in Il like case can Jones or Smith. Say
Smith owes Jones, who is wealthy man, 800.
If Jones should sign an agreement to take of
Smith, or any other man, Il peck of potatoes
for 800, that peck ofpoatoes, or paper upon
which the agreement is written, would unques-
tionably be worth 800 to Smith or any other
man. provided Jones hasn't issued too many
such agreements, and would be made so by
the fiat of Jones. So the government makes
80 cts. worth of silver, or in the case of the
subsidiary coinage, 81 cts worth of silver,
good in the discharge of Indebtedness to the
government for 100 cts. As long a.. Smith
owes Jones 800 his peck OF potatoes is all
right; and so long as the government does not
put out more silver than can he made to take
the place of gold il will be as good us gold al,
the government standard; but after we have
more silver than can be used IN paying govern
ment dues, or settling foreign balances, ali
furthur receipts of gold in the national treasury
or in settlement of commercial balances will
cease, and we shall have another gold premium
at once, going up rapidly 80 10 per cent, the
actual difference between the fiat" and real
or bullion value of silver.
In the case of fiat money the operation will
be exactly the same. The experience OF the
mcnt of tariff impoSts to the government and
the payment by the government of the interest
upon the public debt, about Sl2jOOO,00O OF
gold has been amply sufficient If the govern
receivable the same H. gold for all public dues
there j. no doubt that to the extent Of S12j, 900,
600. or possibly even 800 100000 they could be
kept At par with gold, for the government
would be virtually rcdecming them in gold
every day les receiving them the same as gold
in the payment of public dues. But suppose
the government should issue more than could
| be- regularly absorbed IN the payment of take,
or custom dues, and made no other provision
| for their redemption. i any man fool enough
To imagine such paper could any longer I've KEEP
al par with gold: If il could--ir without re
gard To H. redemption either IN the way o
,jaN paying or exchange for mctal-thc simpl,
ldespotc fiat Of the government can make bit
iof paper or chips money, then, in heaven
InaInc. why J. Russia now 80 embarrassed /,
4 ruise money that IT. legal tender "grconbacks'
\ are worth hut 90 cts. on thc dollar. and Turle,
ia such strait, that IL "greenbacks" are no
worth 10 els ON the dollar, lct the empire a
Russia has It's paper money IN circulation II
proportion to population today than the L. ;
n have. and IA all the elements uf wealth j. on
equal and Turkey i at least our equal in Ia
matter of enforring IT, fiat" if that alone will
make rag money.