Mineral Point tribune. (Mineral Point, Wis.) 1869-1938, 1878-11-06
SUPPLEMENT
HONEST MONEY.
Speech of Hon. Carl Schurz, at
Cincinnati, 0.
Solid Arguments in Favor of
Resumption.

cinnati with an invitation to speak to them on
the financial questions before the people.
thank you sincerely for the confidence which
that invitation implies, and respond to it with
deep sense Of responsibility.
From time lmmemoral, and in all countries,
it has been the habit of all politicians, when
the people were laboring under business de-
preston and distress, such as has been affecting
us for the last five years, to charge those man
aging the affairs Of the Government with the
responsibility for it all. And so they do now
When you ask them to particularize their
charge in our case, they will tell you that the
contraction of the currency that the Govern
ment withdrew from the business of the coun-
try the means with which to carry on that bust
ness and that, therefore, business broke down.
This charge has been so often and so conclu-
sively refuted that it well nigh exhausts ones
patience to refer to it again. But you have
heard Of men who tell the same yarn SO often
that they at last believe it themselves. SO 1t
may be with those who still insist that the
crash OF 1873 was caused by contraction. In
deed, the infationists need that story for their
theory. They cannot do without it, and there
fore valantly stick to it. What are the facts
have the official tables before me. There
was, indeed, 4 contraction Of paper currency
from 1865 to 1868; but the business collapse
did not occur in 1868. 1t came FIVE years later,
and those fivc years between 1868 and 1873
are generally regarded as years OF uncommon
\prosperity. Now, what happened with the
currency between 1868 and 1873? In 1868
contraction was stopped In 1869 the amount
Pf paper currency outstanding was $693,o46,-
P56.6I /; in 1870 it was 500, 375 ,8oe.4S; in
III it was $7I7,S7s,75I. 90 in 1872 it was
138, 5000 81; IN 1873 it was s75o ,o62 $685.
This statement includes not only the
eenbacks, the National Bank notes, and the
hctional currency, but also the State Bank
ear notes of 1863, and the compound interest
otes True, it appears that during several
ears preceding
THE CRASH OP 1877;
he currency was not only not contracted, but
Very materially increased, so that in 1873 it
amounted. to over fifteen millions more than in
1850. The fact, then, stands thus: The
currency was contracted between 1865 and
1868, and several years of prosperity followed.
The currency was expanded from 1869 to 1873
and the collapse of business followed. If it
were true, as the inhationists insist, that the
increase or decrease OF the currency were at
the bottom d Our prosperity and depression
respectively, we would have to answer that,
according to the clearly ascertained facts of
history, it was contraction that caused pros
perity, and expansion that caused the collapse.
/ might even add that between 1873 and 1874
the currency was expanded from $3.50, o62, =
368. "a to 1871 AGO, oIb.I7; that is to say, over
thirty one millions, and yet the depression was
not only not relieved, but grew in distressing
severity Our inha,ion friends may not relish
that kind Of reasoning, but what have you to
answer? Those who know me will bear me
witness that I have never heSitated to
eriticise those in power for things l thought
wrong; but | candidly think to charge
those in power with having brought on the
crisis of 1873 by contraction Of the currency
would be just as reasonable as to make them
responsible for the equinoc,ial storms or for the
dcpredatons of the locusts in the West. If
the Government is to be made responsible for
abundant crops of this year be put to the credit
Of the Administration, and Of the Department
Of Agriculture in particular
CAUSES OF THE COLLAPSE
lie. US examine The causes of the collapse Of
&I873, and the subsequent depression, IS un-
prejudiced business men. We all know that
/ The same tine when he ,,an:c occurred here
the autumn Of 1877, similar crisis broke out
Europe, and swept over all Austria, the Ger
n Empire, and almost the whole European
Itinent except France, while severe bust
depression was felt in England Surely,
|ough this is a great country, our Congress
Administration and the Republican party
1t have been at the bottom Of all that;
ret the effects produced by the crisis in
pc were in almost every respect the same
Ere Speculation collapsed, values shrunk
emily, real estate went down; banks, man.
tturers, and trading firms failed in large
mbers, extensive branches Of industry
6pped, laboring men were thrown out of en-
Ioyment or compelled to work for lower
wages, and grievous distress spread all over
those countries as well as our own; and upon
candid examination you will find that as the
effects were similar in the two hemispheres, so
were the underlying causes.
In none of those countries was it currency
contraction that brought about the disaster,
lust as little as in our own; there was rather
an expansion of it, especially in Germany.
No, the real causes were, as | have more than
once had occasion to describe them. great wars,
resulting in an immense destruction and waste
of wealth; large industries ministering
to the work of destruction instead of
producing additional wealth; but after
that, excessive enterprise, stimulated by
apparent success; the sinking Of large
amounts of capital in great undertakings
which could yield no immediate return, such
as the building Of railroads where they were
not needed; for anticipating the future The
invention and introduction OF new labor-sav,ng
machinery, creating new facilities of produc
ton, and melting excessive manufactures be.
yond present demand while speculation, deal
ing and gambling in all sorts Of imaginary
values an immense number of people frantic
ally striving to make money quickly by any
means except solid work an infatuated faith
in the certain success Of windy schemes, and
an unnatural straining Of the credit system by
pushing speculation and enterprise far beyond
the means Of those engaged in it, and finally
almost everybody, believing himself richer than
he was, and therefore spending more than he
could affosd hence widespread extravaganza
and improvident habits
WHAT THE CURRENCY HAD TO DO WITH 1T.
And if We inquire what the currency had 10
do with it, we shall find that in this country
our irredeemable paper money, by its depreci
alton running up prices to a fictitious point,
stimulated the spirit Of recklessness and gam
IN all Is