St. Paul daily globe., 1891-06-18
THE MONEY PRORLEM.

Secretary FOSTER has not yet an
nounced his decision in reference to the
AZ per cent bonds, which mature in
September, but it seems to be taken for
granted that they will not be paid at
that time. The absolute truth is that
there is not money enough in the treas
ury for the purpose without encroaching
on the Sl00,000,000 of gold which is
maintained as a reserve, and as the
basis Of the greenback circulation. The
cabinet has had the difficult choice of
diSSipating this or Of admitting that Re-
publican extravaganza has depleted the
national treasury below the point at
which it can meet its obligations as
they come due. The result of the first
course might. have been the practical
suspension of specie payments. The
second does nothing more than call at
tentiOn anew to what can be accom-
pli5hed by billion-dollar congress,
ruled by Caesar from Name. Its
errors could not be concealed anyhow,
and from party standpoint, as we'll as
from every other one, the alternative
which it is believed the administration
will take is the wisest and best one
Since the ~ per cent bonds are to be
extended, Secretary FOSTER proposes
to make a virtue of necessity, and pub
licly bases his intention on the needs of
the national banks. The continuance
of the circulation of national bank notes
depends on the existence of United
States bonds, and if the S51, ,000, 900 of
these which mature in September were
redeemed at that time it would mean
contraction of the currency to more
than half that amount at a season of
the year when the needs of trade will
require a large volume of money. By
postpOning redemption, this danger can
be avoided for while, and perhaps be
met only after congress has provided
some substitute for the national bank
notes, or when the country is in more
favorable condition to stand the shock of
contraction. 1t should not be forgotten.
however, in this connection, that large
sums of money will be locked up in the
subtreasury by the fall, and that bond
purchases have for some years been a
device relied oD to relieve the market
from monetary stringency. The ex-
tension of AZ per cents. therefore, while
it leaves the national bank circulation
unimpaired, will cut off another source
of supply without which the country
may find it hard to move the crops,
especially as these now promise to be
unusually large.
All these things, as well as the other
facts in this regard to which the GLOBE
has referred from time to time, show
| how the money question is grow
| ing in Importance in the country and
how the government will soon have TO
face the problem in spirit of earnest
ness and sincere patriotism. The
worlds demand for gold is pushing the
metal to position where the supply is
utterly inadequate for the purposes of
/ trade, and the most astonishing preiu-
dice against the use of silver prevails
among influential men of both parties.
1t seems to be settled that there shall
be no further increase in the issue of
government notes. The number of
national banks in the country has
! grown more than IS per cent during the
past fifteen years, but the retirement
of the United States bonds is rapidly
! depriving them of the foundation on
| which they were built. These things
stand on the one side, and on the other
we have limitless expansion of busi-
! ness, the progress of which must not be
arrested by the lack of proper mediums
of exchange. The GLOBE believes in
honest money as fully as does any one,
but it is as thoroughly opposed to cur
rency contraction as it is to it's increase
beyond legitimate needs, and it is as
thoroughly opposed to a standard
which is constantly increasing in
value as it is to one which fuc-
tuates irregularly, or which is con-
stantly declining in valae. 1t fails to
see i'll the problem anything which
sagors of party. Every honest man in
the country, no matter what his politi-
cal creed, is interested in putting the
currency of the United States in posi-.
tion where it Will automatically re.
| spond to the needs of business in its
volume and where it will be steady and
| permanent in value. Men who have
any other desire at heart are not patri-
| OTIS, and ought not to be listened to.
Those who are patriots ought to CO.
operate to this end. The Fifty-second