The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1891-07-19
sound and permanent settlement of the


tinue its coinage, because, in so doing it
IS increasing its stock Of currency, the
future value of which can not be depended
upon, and which might easily become q
source of embarrassment and injustice be-
tween citizen and citizen, between debtor
and creditor. In our country, however,
such was the political influence of the sill
yer producing states that they easily in
duced congress to order the coinage of not
less $24.000,000 per annum of standard
silver dollars. The effect of this has
been. undoubtedly, to somewhat check
the decline in silver bullion, but at the ex-
pense of the certificial addition already of
$3.50, 600 900 of badly deprecated legal ten
der TO our circulating medium. Our whole
currency system has thus been Initiated ;
for our $3.50, 000. 900 of paper money may be
redeemed in silver; and We are thus ex-
posed to the greatest dangers in the event
OF anything causing an important drain
OF gold to Europe. That the coin thus is
sued was not really needed for the pur-
pose of circulation is demonstrated by the
fact that it has been found impossible to
get more than one-third of it into circula-
ton. In order to obviate this difficulty
various devices have been introduced for
keeeing the coin in the treasury and issu-
ing against it paper certificates of small
denominations
The most ingenious of these contri-
yances was the one proposed by Hon. A.
J. Warner, of Ohio, and pressed on the
government for its Endorsement Mr.
Warmers measure virtually comedies that
the coinage of the silver dollar has already
been carried to a point that threatens seri-
Gus danger to our currency system. 1t
first proposes to discontinue the current
monthly coinage of the silver dollars re-
quired under the existing bland act"
Second-This Warner measure provided
that in lieu of such coinage holders of sill
yer bullion may deposit it to any amount
IN the United States treasury, the govern
ment 10 issue to such depositors bullion
certificates" expressing an amount of
money equal to the market value of the
bullion at the time of its deposit. These
certificates are to be q new form of cur
rency, employable by the government
in liquidation of all its debts not
expressly made payable in gold, and it
would be required to accept them in pay
ment of customs duties and public dues
generally, the national banks being re-
quired TO accept them in payments be-
tween themselves. The measure further
proposed to make these certificates redeem
able in lawful money-gold, silver or Z. s.
notes-or at the treasury's option in silver
bullion at its current value at the time of
redemption.
There is very positive doubt of the
constitutionality OF this plan. The con-
stitution does not convey upon the gov
eminent the right to receive silver bullion
deposit To become the custodian of
bullion and to issue especially privileged
receipts would be breach of the true
functions of government and of the con-
stitutional limitations of federal authority
The provision made for the redemption
of such certificates would be to the last de-
gree Objectionable. If the government re-
deem them in lawful money, it exposes
itself to a new demand upon its legal ten
- IL q
greenbacks owned by the treasury now
runs so low as to prohibit their use for the
purpose, the redemption would have TO be
made with the treasury gold, thus ex-
changing government gold for silver bull
lion. What could silver men desire more
What could all other interests dread more
The government would be ultimately
driven to redeem the certificates in silver
bullion. What does that imply? First,
that the treasury would have to stand the
loss upon the deposits of bullion that
might arise from a fall in its value.
Take a case tor illustration. A deposit
is made of 1000 900 ounces of gold when
the current price is 81. 10 per ounce, the
treasury being required to issue against il
81 100 600 of certificates. Later, when the
price of silver has fallen to say $l.05, the
81, l00. 900 of certificates is presented for
redemption, and ,047 ,619 ounces of silver
have to be delivered as the bullion equiva-
lent at the current market value, the gov
eminent losing 47,6l9 ounces of silver.
Seeing the profit made by depositing bull
lion at high price and withdrawing 1t at
lower will not all who can do so work
this treasury silver mine to the utmost
Unprincipled spectators would mulct the
government out OF millions of dollars.
Speculative combinations would be formed
with London bullion dealers. European
bullion would be secured and sent to
our treasury after its price had been
advanced. The price would then be forced
down, and the certificates presented to be
redeemed by a much larger quantity of
silver than that deposited against them.
The government would lose in every deal.
No finer scheme for spectators could be
many ways dependent upon the value of
silver, nothing could be more serious.
There is nothing in the measure offered
by Mr.. Warner that would prevent the
United States treasury from being
saddled with as much of the Eu-
ropean stock of silver as spectators
find it to their interest to send here in ad-
and for such deposits the treasury would
be compelled TO pay whatever artificial
price it suited the operators to determine.
And what does such a transfer involve
First, that We should have to ship so
much more gold to Europe, making the
silver for Americas gold; next, that the
United States government would thus be
made to bear tn sole weight and respon-
sibility of carrying the worlds surplus of
silver; next that, as conse-
quence, England, Germany and other
nations would become still more
reluctant than they now are to negotiate
for an international settlement of the sill
yer question; next, that the government
would be so handicapped with the enor-
nous load of silver as TO place 1t to an ut
ter disadvantage in such negotiations /;
next, that the government would be ex-
posed 10 immense losses in assuming such
vast responsibilities; and next, that the
large issues of certificates to be made
against this mass of bullion would be a
forcible and artificial imitation of the cur
rency, which could not fail to produce dis
aster TO all the material interests of the
country.
The only wholesome treatment of this
question is to repeal the silver coinage
act. That done, we should add $25.0000 900
to our yearly exports, instead of locking
up so much of our national product as
dead capital in the treasury, while that
increase of exports would give us greater
command of European gold, and thereby
strengthen our international position on
this question. Europe, and especially
England, would then be compelled to
earnestly consider measures for placing
the double standard upon broad and
lasting international basis; and, as such a
disposition began to manifest itself, the
silver market would so far sympathize as
to amply compensate producers from any
losses they might suffer from temporary
fall in bullion.
Bad as the situation is in respect to this
vast mass of the worlds circulating
medium, yet it is far from being hope