The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1879-11-26
Comptroller Knox's Report.


nual documents prepared at Washington for
the information of Congress and the coun-
try The annual reports of Comptroller
Knox have always been first class-models
of clearness, precision, orderly arrange
ment, fulness of information on their proper
GUS matter, and soundness OF view IN
their argumentative and recommendatory
portions. This year his report happens 10
be of unusual interest from the fact that'
since the date of its last predecessor we
have successfully, nay, triumphantiy re-
sumed specie payments. The year Oh
resumption will always make great
figure in our financial history. Inc trans
actions of this year are indeed wlthou.
parallel in the financial history OF the
world. It is satisfactory to have them
so exactly and intelligently recited,
and we can pardon the tone OF ex-
ultation which pervades Comptroller
Knox's lucid report. Resumption is the
great event of the year and one of the great
events of the century. 1t is the privilege
of the public officer to whose lot it falls to
record the details and discuss the conse-
quences of this great event to present in
formation which will never cease to be
valuable and to command an amount OF
attention rarely bestowed on the report of
a subordinate officer.
We pass over the jubilant parts of this
document without special comment, be-
cause there is danger that all this exulta-
ton may be changed into bitterness. The
splendid funding operations by which the
interest on the national debt has been so
to which we can perceive no serious draw
backs but the resumption experiment,
brilliant as it seems on its face, is not with
out its perils, and we think notes of warm
ing are more appropriate than blind and
fashy acclamations. Resumption, how
ever dazzling for the moment, does not
rest upon a solid and secure basis. 1t is
like vessel putting to sea in favor
able weather under a great cloud OF
canvas unmindful Of rotten timbers which
may be stove in by the first heavy storm.
There is great deal that is false in the re-
sumption experiment Wear coming base
silver dollars in which the paper currency
of the country can be redeemed, and if this
coinage goes on this debased silver will be-
come our ultimate standard of value and
our currency sink to the bullion value of the
silver dollars. When our currency reaches
that stage Of depreciation it will be in q
worse condition than it was for several years
previous to resumption. This great danger
can be arrested by stopping the coinage of
silver or by so increasing the weight of
bullion in the silver dollars as to make their
intrinsic value equal to that of the gold
coins.
But the silver peril, formidable as it is.
is not our greatest danger. Resumption
stands on such basis that its success is
owing to favorable accidents. The good
harvests of America and bad harvests
of Europe, depending on caprices
of the weather which may be re-
versed next year, have brought into
the country swelling tide of gold,
which may flow in the opposite direction
with change in the fruitfulness of the
seasons. When gold goes pouring ont rs
rapidly as it is now pouring in We may be
in no condition to stand the change.
The vice of our boosted resumption lies
in the fact that there is no real redemption
of our paper currency. The whole volume
of it remains in circulation, and an absurd
law requires the Secretary of the Treasury
to pay out the legal tender notes
as fast as they are received in
exchange for coin. Any contraction of the
government paper is thus rendered illegal,
even when imported gold is flooding all the
channels of circulation. Such pretended
resumption is ON absurdity on its face. 1t
when gold is SO abundant that the legal
tender notes could be withdrawn without
any contraction Of the circulating medium
With gold enough to take their place
and dispense with their use it is
still the policy Of the government
to pay them out as fast as they
are received and nullify the redemption
about which the Treasury is making oil
these vaporing boasts. This fair weather
resumption is as deceitful as '"summer
friends" It cannot be relied on in those
mutations of trade which may any year
affect the foreign balance. This fair
weather resumption Is delusive and dan.
gerous. What we need for the security Of
business is the establishment of our cur.
rency on such basis as will enable the
country to stand the shocks which are
always liable to come in the vcissi.
tudes of international commerce. An
exceptional year like the present, 80 highly
favorable to the trade of the country, is nc
test of tho safety of system which, to be
of any value, should be adapted to oil the
exigen cies of commercial life.
We must do Comptroller Knox the JUS
tice to acknowledge that he is not insen-
I'LL - tba ,,orilu of tho situation We