The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1890-07-06

mat this 0emOn6 tIZallOH WAS III Tue lutclCot
of the creditor class, and was secretly done,
Whether it was the work OF the creditor
class or not it is quite certain that it has
resulted greatly TO the benefit OF that class
by reducing the amount OF money IN circu-
lation and increasing its purchasing power.
Norway, Sweden, Denmark and some
other countries followed our example of
dem onetizatioD. and the Latin Union first
limited the coinage OF silver, and when the
silver from Germany was thrown freely on
the market, closed the doors OF its minis
against silver. So Germany, France, Italy,
the Scandinavian countries and the United
States refused to mint silver; Germany
threw on the market all the silver she could
spare, the United States sent all its pro-
ducti0n, fully One-third of the worlds
product, to Europe to be used to break
down the market price of silver, and thus
discourage its use and increase the demand
for gold. Germany, the Scandinavian coun-
tries, the United States and Italy all be-
came bidders for gold, and the price went
up when measured not only by silver, but
by all products and commodities. Ger
many, the United States, Italy and other
countries called for and received vast sums
of gold to take the place in the United
States and Italy of paper money, ana IN
Germany Of silver France to pay her Ger
man indemnity had parted with great part
of her gold, and was also bidder Tor gold
to make good other losses IhuS the prlI-
clpal financial countries OF the woflu were
buying gold and discafdlng silver, ana Sill
Yer ceased to sustain the relation to gold
that it had heretofore sustained; but 1t did
and still does maintain its relative position
to all other things that it did before 1878.
In February, 1873, the Congress OF the
United States passed law restoring the
silver dollar to the circulation OF the coun-
try by the purchase and coinage OF S2,0O0,-
coo worth of silver each month. This bill
was vetoed by President Hayes and passed
over his veto on the 2Sth Of February OF
that year. Under that act. which is
still in operation, there had been coined,
up to the 10th of the present month,
$500, 364, 266 OF this amount there was at
that date in circulation 81, 6S3, AIS silver dol
la rs, while the silver certificates issued on
silver dollars held in the Treasury for the
redemption of the certificates amounted to
1898, 513, 045, making total of silver dollars
and certificates In circulation doing money
duty of $3.50, 1876, 400. This leaves a balance
of silver certificates and silver coin in the
Treasury Of only Sl4, 167, 500
The act of February rs, 1873, has been
known as the Bland-Allison bill. This bill
met with the most determined opposition
from the President and lie Secretary oil the
Treasury, bankers, chambers OF commerce,
boards OF trade and what is known as the
capitalistic class of the country, all of whom
prOphesied disaster to the business OF the
country if it became law, because OF the
initiation which they claimed would be the
result of coming So much silver and be-
cause, as they declared, gold would be
driven out OF the country. The Secretary
of the Treasury declared that the coinage
of 100000 OF silver dollars would drive
all OF the gold out of the country. Sena-
tors and members opposed to the bill Joined
in these prophecies Of evil. We have coined
more than seven times 100000 and yet
the country is not on a silver basis. We
have now more than four times as much
gold in the country as we mad 10 1878.
The decentralization Of silver was brought
about by the creditor class, the only class
that could be benefited by the destruction
OF one-half of the money of tie world, for
il is a well-estabhShed principle III finance
that the number of units OF money deter
mine its value. That is, If there are but
few dollars i'll country, each individual
dollar will buy more than it would if there
were many dollars.
The decentralization Of silver in Germany
and the United States induced other ma
tons 20 demOnetlZe silver. Thus the de-
mand for silver was less6ned and the de-
mand for gold increased, for when a dollar
of silver was prevented from doing money
duty new gold dollar had to be found or
the gold dollar in existence had to do in
creased money duty. The effect of this
was TO appreciate gold, or, in other
words, reduce the prices Of all cOmmOdi-
ties measured in gold. In a short time
gold bullion would not exchange for silver
bullion on the same terms as formerly and
the same was true of wheat, corn, cotton
aud all other products. Then the gold
monometallsts insisted that silver had
fallen, when as a matter of fact it was gold
that had risen. Silver. whether considered
as bullion or as coined into dollars, has
appreciated in the last seventeen years.
1t will in either form exchange Tor
more commodities Of all kinds than il would
then. In countries using silver this is
plainly seen by the slight fall in prices.
Gold has appreciated IN 3 greater degree
than silver, not because VI its especial Ill
ness for money, but because Of its scarcity. !
do not mean that there is any less gold |
than formerly, but the same amount of
gold or nearly the same amount is required
to do nearly double the wOra that it
formerly did. In other words, the work
formerly performed by silver and gold is
now largely done by gold alCne Let US
illustrate: Suppose wheat and corn fur
nished the required amount Of grain for
mans use, and by some means all the corn
should be destroyed. Then wheat alone
would not suffice aud wheat would be ap-
preciated because of the demand for it.
The principal demand for gold is for use as
money; if that demand is increased, gold |
will appreciate. This demand was increased
just TO the extent that the use OF silver
diminished.
So much as to the facts New, a word in
argument. What could the producing
classes gain by the characterization of sill
yer? What advantage could it be to the
n .
in production of any kind, to do the bust
ness OF the world with a half of the me-
tallic money that had been heretofore In
use? Silver had not deprecated. Even when
measured by gold it had proved itself
stable metal for thousands of years. and had
been the standard by which gold had been
measured. 1t was the fayori,e money of
the people If the world. 1t was the first
metallic money used by man, and 1t was
the only money metal that promised to be
ff.l
pace with the worlds demands for metallic
money. The production of gold was falling
off each year, and it was quite evident that
no great reliance could be placed on gold as
a money metal, for the best-infOrmed peO-
pie on that subject have declared that its
production was not sufficient, after deduct
ing the amount required for use in the arts
and the loss by wear and waste, to MAIN
tain the present stock Of gold in the world.
Hence we must admit that the demonetiza-
tiun of silver was either great blunder or
a great crime.
All who have examined the effects of the
decentralization by Germany and the United
States in the first Instance and other ma
lions later must, and l believe do, admit
that great evils have resulted theTefrOm.
No one has yet been able to show that It
has been Of any advantage to any class save
the creditor class.
The decentralization of silver has increased
the purchasing power of gold 50 that the
same amount If gold will now command
much more labor and more commodities of
all kinds than it would in 1871 or prior there
to. The price of labor is less and all the pro-
ducts of labor bring lower price. Land is
not worth so much. Machinery and build
ings used for the production of COM
moditles are less valuable. 1t requires
more labor, more effort, more sacrifice for
the debtor TO procure the means to pay his
debts than it did before the decentralization
of silver 1t is pretty generally conceded
that the fall in prices is not far from 80
per cent. On many articles it is much
greater than that. This, then, is equiva-
lent to an addition of SO per cent to
all the debts. In other words, the cred
itnr will get 80 per cent more
of commodities if he is paid in commodities.
and if paid in money the money he receives
will purchase 80 per cent more, while the
debtor must make an effort 80 per cent
greater than he otherwise would to pay his
debts. This, then, is equivalent to the adj
dition of 80 per cent TO all the debts in the
world, for this decline in prices is not con-