Omaha daily bee., 1891-05-17
alue which II would otherwise

nuts did not become too plentifuD they would
be largely enhanced In value while they were
in demand TO satisfy existing contracts or
pay existing debts, but | do say that as
under such conditions all existing contracts
would soon be cancelled, and no new ones
created. except upon the basis Of the natural
exchangeable value of douVhnuts, they would
soon cease to be In demand, aud possessing
In themselves only the value of doughnuts
they would sink back to their natural dough.
nut value. But the operation sketched
ought not to be recognized as
creation OF value, even Of temporary kind.
IL Is really robbing under the guise Of law.
Governments can confscate and destroy, they
cannot create value
.Q.-How, then, is 1t that 4l2l5 grains Of
silver, coined into silver dollar, will ex-
change In the market for % $40 grains OF
gold, while as bullion the same quantity OF
silver will only exchange for about two.
thirds OF as much goldi
A-Thero Is one simple answer which
completely explains the disparity. Great in
genuty Is displayed in making some other
explanation, scientific perhaps, but hard to
comprehend. The one | submit is simple
anyone can comprehend it, viz:
For some years past and at the present
time, the United States government has been,
and is, In the receipt Of an income, through
tariff duties and excise dues OF about 81 800.
900 per day. This large revenue 1T dis
burses in payment of the interest and
IOWdluS tne prlHCIpHl OF ltS 0eDt, Tor pen
sions, and for general administration ex-
penses. Upon its debts, ana to whomsoever
desires, II pays gold coin on the basis of
% $40 grains TO the dollar. From whom
soever desires to pay money into the treasury
through the excise dues, 1t will receive as
equal value gold coin, or silver dollars con-
tanning 4l213 grains each. Thus it
practically buys that amount of
coined silver giving in considera-
tion an exemption from the payment of
n |
receive nickels or dimes in satisfaction
OF such dues in similar way,
they would become exchangeable for
about dollar in gold each. IL it were certain
that the government could continue thus to
receive them with one hand, while with the
other 1t continued to pay as now in gold.
The operation Is, in fact, virtual exchange,
to the extent the community now desires, of
gold coins and silver coins on the basis of
their (theoreticaD legal value, instead of
their commercial or natural relative value
Inc difference some one now does, or will
hereafter, inevitably pay.
Q. Cannot the government continue this
forever, and thus forever preserve higher
value to the silver coin than its equivalent in
silver bullioni
A. No. Because with the continued coin
age of silver in its present ratio TO the coin
age of gold, about three to one, that is to
say, hfty-four millions of silver against say
twenty millions of gold per aunum, the pro
VIII steadily increase, until the treasury de-
partnent will be obliged to either pay in sill
yer or buy gold in exchange for it. With
free coinage of silver, this result will be the
sooner reached.
Whenever the government IS thus com
PEELED to suspend its present course in the
respect just pointed out, the real commercial
relation between the gold and silver coin will
begin to appear. Then silver coin and silver
bullion coinage being free) of the same
weight and tineness will be alike in value
precisely as gold coin and gold bullion now
are.
Q.-Then you do not believe that the free
coinage of silver as now proposed would
enhance the value of silver bullion and re-
store the old relations of IL to l between
gold and silvers
A.-Free coinage Of silver would no doubt
give TO 4l.}9 grains of silver bullion, $40
fue, as much value, /. o., purchasing power,
as would be contained in the coined dollar;
and II the government or some other power
rich enough. would forever give gold for sill
yer in the ratio OF to 10, then the old rate of
IL to l could be maintained But we have
already perceived df it be the truth that
our government caunot do this. 1t may be
added that so long as the government is will
ing TO accept silver as q fixed ratio, thus Gre
ating an artificial value for 1t higher than its
natural value, silver will, as sure as water
seeks its level, flow from all parts of this
country and also from foreign countries into
the United States treasury, driving out
the gold, and the government will
if the government had the financial ability
to bear the loss it would be foolish use TO
make of it, since all its power is derived from
the people and Is used at their cost.
The fact is that the value of all things,
that is, their exchangeable quality for other
things, is determined, and ought to be deter
mined, by the free play of human action.
Efforts made by powerful bodies, govern
mentS, corporations, syndicates or trusts, to
ttFtth n,tis Nf,, 10.
regards are injurious TO all. The statement
Is as true when applied to gold and silver as
1t Is of other things Neither gold nor silver
has value different In kind or differently de-
rived from other things. They are good for
use and ornament; they will exchange for
other things; but the relation in which they
will exchange for other things never con-
tnues for any long period the same. Nor is
there anything in their nature on account of
which (under any rule that can be sta ted
they should, in law or morals, continue to be
exchanged for things in a fixed ratio to each
other, of 10 to or l6 to |, or any other ratio.
In fact, except within nominal limits they
never have thus been practically related.
mas been made TO make fixed
ratio practically operative, that effort
has finally failed. 1.-THE ancient historians
tell us of early times in Arabia and in Ger
many when silver was worth the same as
gold, weight for weight. The ratio fixed by
Spain in 1897 was 109l to l. Then IN 1916, be-
ing dominant in the world of commerce and
finance, she fixed the ratio at l315 To |. In
the next century QGSS), one hundred years
after the defeat of the Spanish Armada, Por-
tugal, then prosperous, wealthy and domi-
nant, fixed the governing ratio at 16 to |.
Then in l1l7 England fixed hers at l5u2 to l.
France in 1926 at IA to | Spain in l775 at
l5l3 to in the Peninsula, though IS remained
the ratio in her American colonies. In 11S5
and 1909 France adopted the Spanish ratio of
l5l5 to l."-Prof. Stackpole. One of the
two metals has always been the real money
OF account, the real instrument of exchange
in the great industrial movements; the other
has operated in an auxiliary and subordinate
capacity. Perceiviug this to be the fact,
Great Britain in 1916 gave up the experiment,
ma gold the sole money of account and
coined silver for subordinate use only.
In our own country, from 1892 to 1873, our
mints were open to the free coinage of silver
and gold part of the time in the ratio of 10 to
], and part OF the time in the ratio of III to |;
but in the whole period of eighty years, only
eight millions in silver dollars were coined.
The mints of Mexico and Japan are both open
to gold, but silver, being the only medium of
exchange, alone goes 10 the mint.
The Latin Union, so called, made league
limiting the coinage of silver, hoping thus to
preserve In practice theoretic ratio; but
they were obliged to break it and suspend the
coinage of one of the metals.
If we wished to secure the free exchange
OF these metals in a fixed ratio il would be