New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1882-01-17
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THE PANIC-NAKER.

THE PANIC-MAKER
Mr.. Carlisle, the Democratic Representative
who caused panic last February, is doubtless
n well-meaning person. He did not mean to
disturb commerce, to check industry, and to
cause heavy losses to thousands of Innocent
people and absolute ruin to many. A well
meaning person who attempts to run steam
engine without knowing anything of the nature
of the machine or the properties OF steam, Is
generally held respon sible, however, If he
causes frightful loss of life. The Democratic
legislators, judged by their acts, are OF t"o
classes. Some are dishonest demagogues, who
care not a lot how much the country suffers If
they can get votes, power or profits. Others
are persons who mean well, but know nothing
of the machine or of the powerful forces with
which they NEEDLE. 1t is hard to say which
class the public has most reason to fear.
One can reason with the dishonest dema-
gogues, however. Measures which harm 'ho
public do not help their authors in the long
run, and an appeal to the self-interest OF these
men is sometimes effective. For instance the
Democratic demagOgues suddenly turned tail
during the last Presidential campaign, and
began to shout for Protection, as soon as they
discovered that raid upon American industry
was going to result in their defeat. But the
well-meining blunderbuss cannot be convinced
by argument or events He is not capable OF
knowing what the events mean, and as Tor
arguments, he thinks more Of his own than of
any others-a fact for which paternal fondness
is his excuse. Thus we have Mr.. Carlisle again
arguing that his amendment of last year was
beneficial and meritoriOus one, subimey UNI
conscious of the fact that events have demon
stlated its supreme folly. 1t would be waste
of time to show him that financial crash was
the inevitable result Of such a measure. The
man does not know that steam eXplodes, or
that engines need supply of water. Put him
OH any financial machine in the world, and he
will make a smash with the best possible inten-
tions. Afterward, viewing the wreck, he will
abuse the ill-tempered and dictatorih steam
for resisting his plans.
Banks are human beings. This is bit of
information which Mr.. Carlisle has not learned
Human beings do not leave their property III
the absolute control of somebody else if they
can avoid it, dislike to be bullied or cOerced i'll
the use of their savings, and are apt to with
draw their money from business which they
find relatively Improbable The attempt to
cocrce the banks into retaining circulation on
three per cent bonds, and to deprive them OF the
power to surrender circulation and recover their
bonds when they pleased, was precisely like an
effort 10 bully or bulldOze Mr.. Carlisle into
surrcndcIing forever the control and use of his
own property. The poor man can understand
that he would never sign away control OF his
house. or other property, or his business. But
he cannot comprehend that banks have such
feelings. because he is ignorant of the fact that
banks are associations of human beings who
feel about their property just as he does anout
his.
In common with all others who act with him,
Mr.. Carlisle pcrsstently refuses to see the very
important fact that three per cent bond might
not always be worth par in the market. Now the
banking system has for its very cornerstone
the provision that bonds never worth less than
par in open market shall be held as security for
creditors. If the banks are forced to buy and
deposit bond which afterward sinks below
par they are not only robbed-a circumstance
which Mr. Carlisle probably can see, but for
which he probably does not care-but they also
have their credit, which is their very LIE,
shaken to the foundation. The three and
n half Der cent bonds are redeemable on
demand and therefore would be unlikely
to sink below par in any emergency, be-
causc the Government could then make money
by accepting offers Of them. But three
per cent bond, not redeemable for fixed
term, might easily sink in any grave disturb
ance, as far or further than British three per
cents have fallen. Such decline, III bonds
upon which great part of the bank circulation
is based, would bring terrible disaster, not
merely upon the banks, but upon all commerce
and industry. Mr.. Carlisle himself would
suffer, just as an ignorant engineer often gets
torn to pieces by the explosion which his own
bluuders have caused.