The Iowa plain dealer. [volume] (New Oregon, Howard County, Iowa) 1867-1895, 1882-02-16
THE FINANCES.
Peter COOpcr's Open Letter 70 sccrc-
laFy EO1ger.


Peter COOpcr's Open Letter TO SccrC-
tary FOlger.
SECRETARY FoLaER: Your report sent to Con-
gross IL document of the deepest interest to
tho people Of this country. The facts and fg-
nrcs relating to the financial affairs Of the
Government, tho great prosperity Of the busi-
ness, the rapid extinction Of tho public debit,
and the sound condition OF our finances, are
calculated to inspire = feeling Of admiration
and pride In the minds Of every American citi-
zen.
That portion Of your report, however, which
calls the attention Of Congress to some meas
urcs requiring consideration, and the kind OF
legislation suggested, has filled my mind with
tho greatest apprehension, and cannot, there
fore permit the opportunity to pass without
entering my protest against the adoption OF
some OF the measures you have proposed.
Will you permit me to call your attention to
some Of these measures, and to the disastrous
consequences, which, in my judgment, would
be certain to como upon the people II they were
carried out.
mends which object to. are the following:
]. To withdraw the silver certificates.
2. To stop the coinage Of silv Or dollars.
5. To remove the legal-tender quality Of the
treasury notes.
1. 10 permit banks to supply the paper cur
reIcy, Or the flaws of trade demand"
5. 10 reduce the revenues OF the Govern
ment by removing the tax on bank deposits,
and bv a reduction Of custom duties
9. TO postpone the payment Of the debt until
the next generation.
Z. To practically have all the bonds paid in
gold coin.
Let us consider these measures briefly in the
order here mentioned.
Ii understand you correctly, oil Of the silver
Office upon deposit Of gold coin in like
Now, If this is true, is 1t not an evidence that
the business men Of this country prefer these
silver certificates for business purposes to gold
coin? Why then, l ask. should Congress pass
an act to withdraw currency that Is preferred
TO gold coin? understand from your report
also that these silver certificates are payable
in silver dollars" IL SO, il not this further
evidence that silver certificates payable insilver
coin even are equal to, il not superior to gold
coin as currency in the estimation Of busi-
ness men?
Your report informs us that all but $3.50, 900
Of the com in the treasury IL already covered
by these silver certificates, and that the cur
rency in circulation has been increased to the
extent OF S66, OOO, 900 by the issue Of these Ger
tificates. Can you now withdraw these certifi-
amount2 DO You think 1t would be . safe
experiment to contract the circulating medium
$66, OOU, Ou02 You say the circulation Of
sG6, OO0, 900 Of silver certificates seemed an in
expedient addition to the paper currency" Do
you think that after having put them IN circu-
lation and business operations had been based
upon them, prices increased a. the result Of
such imitation, and debts contracted on them,
that il would be q safe and lust experiment
now to take away this currency and leave that
much less money in circulation? Would the
business men be satisfied to use silver coin in
place Of certificates which they prefer to coin2
You intimate that tho national banks under
existing laws might If they were disposed
cause q serious contraction OF the currency
and grave embarrassments 10 business by re-
turing their circulating notes, and refer to the
results of such trans actions at the time Of the
passage OF tue Refunding bill by the last Con-
gress.
II such serious consequences and grave en-
barrassments to business followed the contrao-
ton Of only SIS 600, 900 Of the bank notes last
spring, what would be the result OF the with
drawal OF $4,000, 600 OF silver certificates!
You say that there need be no apprehen-
sion OF . too limited paper circulation, for the
national banks are ready to issue their notes in
| such quantities as the laws Of trade demand.
and rs security therefor the Government holds
its own bonds"
1t is very evident that the banks would
required rs money, aud therein les the danger.
The silver certificates are based on their full
value in con in the treasury. but what assur-
ance have you that the banks would be able to
redeem the increased volume Of their notes in
coin? Baslng bank note that il not legal
tender on Government bonds does not pro.
tect the business community from the effects
OF q dangerous imitation, or from bank suspen-
sion and panics afterward. The bill holder
might be secured, but business men would not
be protected against q sudden contraction Of
the currency, which might make the deposltors
unsafe.
Again, you question the constitutional right
OF the Government to issue legal-tender notes
in time Of peace, aid suggest that these notes
be deprived Of their legal-tender quality.
It seems to me that, in making such sug-
gestion, you could not have just appreciation
Of the value Cf these notes to the people, or re-
alizc to what extent that value is enhanced by
| their legal-tender quality.
You admit, however, that legal-tender notes
"are, without doubt, . convenient and safe
currency for the people, and that it is for the
profit Of the Government to continue their
circulation and yet you advise taking from
them one Of their most valuable qualities. Do
you not know that by depriving these notes Of
their legaI-tendcr function, you would diminish
the volume OF legal-tender debl-pay-
ing money to lie extent Of tl36, 862, :
OO0 at once? Fave you considered
what would DO tho effect Of such .
course upon the debtors? II your policy WAS
carried out, it would practically force every
debtor in the country to meet his obligations in
| gold coin and although those debts have been
contracted in legal notes, in silver certificates
and in silver coin. you now advise Congress to
| withdraw the silver certificates, to remove the
| legal-tender quality Of the treasury notes aud
| to stop the coinage Of the silver dollars.
| trust Congress will DO too wise and too just to
| heed such advice o. this, for II they lefislate
| to carry out your suggestions, they would in
evtably bring upon the country one OF the
most widespread and long-continued ranics
ever known in tho history Of this countE; >
panic that would involve the business MIN in
bankruptcy and also inaugurate revolution
among the laboring classes.
/ Has not the Supreme Court repeatedy do.
cided that the issue Of legal tender notes ~ the
Government was constitutional measure and
| AZ these notes are now, ~ you say, "a cenvc.
nient and safe currency" and "prodt To tho
Goyernment" and are preferred to either gold
| or silver coin by the business men Of tie ma
ton, and for twenty years have thus been used,
would it not be financial suicide to attempt
either to remove their legal-tender quality or to
withdraw thcm from circulation? Are they not
IN fact the only stable currency we hayei For
| the last three and half wears their volume has
been fixed and uniform That volume can
only be changed by act Of Congress, and after
| the most mature deliberation, while the cur
rency OF the banks is finctuating enormously 1t
the pleasure OF the bank Off ,ers. Your report
| even admits that the banks, by retiring their
circulation Knight cause serious contraction
OF the currency, and grave embellishments in
business" and you advise - . lsmcdv that
they simply be required to give noticAof their
intention to ret re their circulation sbut will
your suggestions in that regard remedy the
evils OF contraction or OF imitation?
The banks hold the power of sNrnst
| unlimited imitation and contraction, which psw-
or they are using to their own advantage, and
there will be no stability O safety in busAess
until that power il taken from them.
The constitutional right to coin monet Ito
make legal tenders and to issue currency rests
in Congress alone, and the people will power
secure justice between debtors and crditors
until, as Thomas Jefferson said, "bank paper
is suppressed, and the function OF issuini cur
rency il restored to the Government, to ihom
it belongs" and all currency, whether can or
paper, il made 1 legal tender for debt.
Again, cannot but regard your suggstion
to stop the coinage Of silver - exceeding.un-