Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1890-12-11
THE INCREASE OF SILVER PRODUCTION

THE INCREASE OF SILVER PRODUCTION.
The silver bill passed at the last session
OF the present Congress, will pass into
history as most short-sighted piece of
legislation. AS facts are deyeloped. it is
becoming daily more apparent that the
projectors of that measure were about as
Ignorant of the facts upon which their
theory was based as men could well be.
The instant the bill was passed, Central
America sent every ounce of silver not
coined to the United States.
The effect it had on the silver producing
regions is clearly disclosed in recent
Denver special to the New York Herald.
The HeratPs correspondent declares "the
silver market is causing serious trouble
among the Colorado smelters and miners
OF low grade ores. When the price of
silver went up under the present silver
bill, the low-grade producers sent thou
sands OF tons of ore to the smelters, which
was purchased at an advanced price," the
advance corresponding somewhat to the
advance made in silver Immediately after
the bill was passed. The correspondent
goes on TO say: "The smelters are now
loaded down with low-grade ores, which
cannot be proftably treated at the present
price OF silver. They figure their loss
since the decline at ten cents per ounce on
S4,5OO,O0O worth of the mineral" This
relates to single district in the State of
Colorado. When silver advanced, it ad-
mitted certain ores to shelters which
could not be worked at a lower price.
An advance admitted still another
lower grade of ores. Here in
one silver-producing district it is shown
that the slight advance made by silver
In anticipation of the effectiveness of the
legislation threw $4,5O0,00O of these low
grade ores into the smelters. When the
sllyer-producing regions of the world are
taken into consideration, the unmistaka-
bic indication is that if silver were to go
to 1929, the parity with gold, the
worlds production of the metal would be
practically doubled.
As heretofore indicated, the theory of
the silver bill was that the Government
OF the United States should buy the sur.
plus annual product of the metal, thus
practically cornering silver to such an
extent as to restore its former parity with
gold. 1t is now perfectly apparent that
to do so would be to create a new surplus
equal to the old. The Governments at
tempt, therefore, to purchase 100000
ounces of silver per annum on the theory
that this would wipe up the surplus
proves in practice to create a new surplus
equal to the 100000 ounces pur-
chased. Thus in the second or third year
after the experiment goes into operation
1t would be necessary to buy 10S,00O,000
Ounces per annum, with the reasonable
probability that the worlds product can
really reach 2OO,OO0,oOO ounces per an
mum if only there is inducement enough
in the way Of price.
Free coinage, which is seriously con-
tempiated by some people, would be at
tended with like results. The silver of
the world would start directly toward
the minis of the United States
Hundreds of mines which cannot be profit
ably worked at the present price of silver,
would come into operation with the i'm
proved machinery for lifting, and improved
instrumentalities for reduction, and the re-
suit is plainly inview. The current expert
ment IN the way of producing an artificial
price for metal by Congressional legisla-
ton is lesson which should not be al
lowed to go UNDECIDED by those in favor of
free coinage. All attempts to confer an
artificial value on the metal simply in
creases instead of diminishing the surplus.
1t is altogether probable that free coinage
in the United States would throw into the
minis 100,000,0OO ounces the first wear.
with gradual increase of that quantity
year by year. Nothing could be more
calamitous to the laboring classes than to
have the country flooded with cheap cir
culating medium. Work would not ad-
vance correspondingly with the decrease
ofthe purchasing power of coin. Initiation
would ensue, gold would be driven out
and the processes which have pauperized
India would set up here. in the very ma
ture of things, silver is demonetized, and
we may as well confess the facts as they
exist without any resort to quack RENE
dies.