The Vermont watchman. [volume] (Montpelier, Vt.) 1883-1911, 1883-12-05
The Financial Situation.

try for the last eighteen months knocks a
big hole in the theories of that class of
political economists who draw all their
ideas from the English writers. What
do we see2 We see money plenty and
cheap without any of the alleged results
no speculation, and no rise of prices, but
rather decline. We see heavy failures
on all sides, but no panic, and no loss of
confidence. These things could not occur,
if the theories of the accepted writers
were sound. The facts are against the
theorists, but then the professors will tell
us $50 much the worse for the facts"
In the face of an abundance of cheap
money the "bears" have had it all their
own way in the stock markets, and in the
markets for produce and manufactured
goods. Prices go down; merchants and
manufacturers fail all around us, vet the
money interests are not alarmed, and all
legitimate operations 60 on undisturbed.
The smallest shrinkage has been in the
prices of farm products, and the farmers
are doing better than any other class.
What is the cause of the present state
of business The cause of TIE low prices
of manufactured goods is no doubt pro-
duction in excess of the demand. The
improvements in machinery have been 80
great that with the same capital in all
cases much more, and in many cases
double the quantity of goods, can be pro-
duced with the same amount of labor.
1t is no use producing more clothing than
people can wear, more iron than can be
put to use, more furniture than the peo-
pie want. But that is what is being done
in America to-day. The natural result is
that prices are 'ow--often lower than the
cost of production, and hence failures of
many establishments weak in capital
There is even greater over.production of
agricultural products, but as agriculture
has not been favored with governmental
protection " it has strength to stand up
and continue to produce at the prices
which foreign nations will pay us, and
still live. Our manufacturers have glutted
the home market, and, coddled by over.
production, they cannot yet 80 manage
their business as to meet the world in an
open market and live, as the unprotected
farmers have been obliged to do, and
therefore can do. There is another trouble.
Our manufacturers are compelled in one
way and another to use great deal of
imported material and machinery which
their own beloved protective system has
obliged them to consent shall be "pro-
tected " by duties that cripple those that
use them. Protection does not protect
worth cent where everything is pro-
tected, and yet how can one industry ask
protection and refuse it to another i?
Nearly every interest except agriculture
has had lobby power enough to get share
of protection, and at last the system is
breaking down with its own weight.
When our manufacturing industries are
ready to face the cold world and its com.
petition, as the farmers do, these things
will regulate themselves, and America
will have foreign market for its surplus
products of every description.
But why is there no panic and no hard
times attending this disturbance in bust.
ness? Simply because we have per.
fectly sound and safe governmental cur
rency, with any quantity of the precious
metals behind it. The gold eagles and
silver dollars piled up in the treasury,
and all ready to redeem every paper note
that may be presented, makes the peo-
pie calm and secure. No bank has to
suspend on account of run for specie.
If one breaks at all, it is only because its
depositors have lost confidence in it. The
bill holders know that Uncle Sam, all his
pockets stuffed out with specie, is behind
this paper money all ready to hand out
the metal, and they don't even look to
see what bank issued it.
But why does not the abundance of
money induce speculation and initiation ?
just simply because there are now very
few opportunities for profitable specula.
ton, and these few are entirely controlled,
and known to be so, by the great CAPT
talists Of the country. For man tf
moderate wealth to 60 into anything of a
speculative nature with his capital is to
invite immediate ruin. The system uu.
der which the big fish eat up the smaller
ones is now reduced to sure thing. Thus
out of seeming evil has good been educed.
These big chaps suck riches out of the
people, but they won't let anybody else
doit. They act really as regulators of
trade. almost like the governor on a steam
engine. A few big merchants are getting
to do all the trading. A few big manu-
facturers will do all the manufacturing.
The rest of the people must be content
with what they can pick up, and the luck
lest are the men who own land and know
how to till it, 1t will be long before this
business can be monopolized, or oornered.