Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1886-01-06
wEDNEsDAY...JANUARY 6, 1886.
Is TIA RInnder /?

Is II Blunder?
The Petersburg Index-Ippeai says
that we committed a blunder the other
day when we maintained that cur
rency of nstional-bank notes was better
than one of greenbacks, and gave as a
reason that in case OF war the latter
would depreciste and the former would
not--certainly, not so rapidly. Why is
ii blunder? Because the bank notes
are now redeemable only in greenbacks,
says our Petersburg contemporary.
Well, bank notes are redeemable in
slawful money" which includes clear
ing-house certificates; but if our theory
be true, and the national-bank notes be
q much better currency, especially in
time Of war, it is not at all likely that
any note holder would be such fool as
to ask o bank to give him irredeemable
greenbacks for its own much more val
liable notes.
But il our theory is carried into
practice, there will be no greenbacks
with which to redeem bank-notes
for our argument was based upon
the theory that the better currency
ought to be substituted for the inferior
one. We showed how the bank-note-
holders are now protected, and told
how they were not protected at all only
thirty years ago, and for these reasons
advocated the present banking system
as infinitely to be preferred to the old.
Nobody can gainsay what we said on
that point. We also tried to show
that national.bank notes are a better
currency than even greenbacks, and
maintained that whilst in case
of war between the United States
and England and France the
grcenbacks would depreciate rapidly
in value. such would not be the case
with the national.bank notes, which
have behind them, as we distinctly
stated, not only the United States
bonds deposited in Washington, but all
the other assets Of the bank. Isn't
this latter argument also sound one If
not. where is the flaw in il? The
Index- appeal assumes that even in
case Of war the banks would have the
right TO redeem their own notes in the
deprecated greenbacks, and therefore
their notes would be no better than the
greenbacks. But we again ask, who
would present a bank-note worth
almost its face in gold to be redeemed
in greenbscks worth only fifty per
cent. Of their face in gold:
At present the Government redcems
greenbacks in gold. and the bank-notes
areredeemable in greenbacks, clearing
house certificates, and other "lawful
money!" Thus several kinds Of cur
rency are kept equal with one another.
But in case of war, the Government
would soon cease to redeem greenbacks
in gold, and would have to make other
provision for redeeming the bank-notes.
These bank-notes would be based pri-
marily upon United States bonds,
which, as the history Of the war be-
tween the States tells US. would not
depreciate as rapidly as greenbacks.
These bonds and the other assets Of the
hank could not possibly fail to make
the bank-notes much more valuable.
depending upon the length Of the war,
ihsn irredeemable greenbacks.
SO We still insist upon the truth Of
cur two propositions
First. That the present banking
system secures the note-holders beyond
doubt. and it is therefore. il for no
other reason, desirable to perpetuste
il.
Second. That the Government could
not accomplish the same object By is
suing greenbacks because although
gseenbacks and bank are OF equal
value in gold now, the former would
soon depreciate in case the United
STATES Government should engage in
war with powerful nation.