Morning journal and courier., 1881-03-01
The Money Question.

ThG money question:
Large Gathering Mt Ldnonia Hall-Prof.
Summer the Funding Measures.
Prof Sumner lectured last evening at Lii
nonia Hall before large audience composed
of students of the different departments of
the university, his subject being the funding
bill. In opening his lecture he alluded tothe
signs of national prosperity on all sides and
thought we were on the eve of unprecedent-
ed prosperity for the next ten or twenty
years. The drawback to this prosperity was
the legislation of the country. There were
three dangers. list. We say we have re-
sumed specie payment and yet we have not
resumed. We have raised paper money to
specie value and are already to begin specie
payment. We have no guarantee but that
the first revulsion will overthrow specie pay
ment. The currency of any country to be
sound should be composed of more gold than
paper. We have had extraordinary good for
tune for the last few years. Crops have al
most failed in Europe, but in the United
States we have had big harvests and specie
has poured in for payment for exports
Four hundred and fifty million dollars worth
of gold thus came in in the last three years,
half of which is in the banks and half prob
ably boarded. He spoke of the measures
taken to reduce the volume of the currency.
AS long as exports are heavy and exchanges
are favorable all is right, but with turn in
the tide there is reason to expect return of
the premium on gold and taste of the old
evils.
The second danger is from silver. Before
the war silver went abroad In 1860 econo-
mists noted that silver was going below gold.
Then there came terrible deterioration of
| stocks in the hands of the people. He spoke
of the troubles of the Latin Union, also Great
Britain and Germany, owing to the deterio-
| ration of silver.
The United States had then no silver, and
| were clear of the silver business. All we had
| to do was to let other countries get out of
| their silver trouble as they had let us get out
of our paper trouble. The United States
unnecessarily and arbitrarily went into the
silver business, and now holds $50, 600, 900 in
silver. It dug it out of one hole in Nevada,
and it was put into another in Philadelphia
and New York. The Secretary is obliged to
buy So, 600, 600 a month of silver, and to OBJ
serve. The result is that the reserve in time
would consist entirely of silver, and when
this took place we should have no gold and
no paper of the value of gold, but our cur
rency would be silver or silver certificates
and paper money of the value of the silver
dollar. When we get to silver there
must be a fluctuating currency that
must limit to great degree the
power of the United States to enjoy its ad
vantages.
The third element of trouble was with re-
gard to funding The grandest refunding
operation in history was performed last year
when the United States Treasury refunded at
| to refund at as low per cent. as possible,
and so lessen the burden of taxation. The
Secretary of the Treasury asked to refund at
81 per cent. or less if he could. The rate of
| interest at which the funding should be fixed
is an executive function not a legislative
function. Congress fooled away much time
| by its childish discussion of this question.
No man can tell what the rate of interest is
liable to be next May. Ask banking man
what it will be, and he will say it is difficult
question. 1t is better to refund at 81 than
/ to pay 6. Congress did not believe it could
refund at per cent, but thought it could force
| the banks to take the 3 per cents. The gov
eminent gave the banks free banking in 1874.
! 1t was a soft money movement, but the re-
suit was that more banks had withdrawn cir
| culation than had obtained circulation by
the purchase of government bonds, SO that
| the circulation had been actually diminished.
The speaker thought it was not right to
| coerce the banks into taking the three per
| cents. that Congress had established these
banks under certain provisions and
| created them when it was to the
country's interest to have this aid. Congress
had obtained some advantages from them
when they became national banks and Con
gress ought to abide by its bargain. Our
legislation was largely empirical. The people
did not pay much attention to what was 60
| ing on at Washington. There had been pro-
posals to pay off the whole national debt in
currency, yet government bonds increased
in value at the time You must expect
the banks to defend themselves all they
can. The banks are not to blame for the
present condition of affairs. The Secretary
of the Treasury has also been assailed for
not extending helping hand to the market
but he has offered to buy $SO,OOO,OOO of
bonds and only $1,000, 900 have been offered
The speaker thought the panic of last week.
as the result had shown, would prove only a
temporary furry. He went on to enforce
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