Pittsburg dispatch. [volume] (Pittsburg [Pa.]) 1880-1923, 1891-11-12
DOCTORS OF MONEY.
The Currency and Railroad Questions
Both Discussed by the
AMERICAN BANKERS CONVENTION.
Secretary Foster Describes the Workings Of
the Silver Law.
THE INTERSTATE LAW CRITICISED

THE lNIEKeSTAIE LAW CklIlClOE
NEW ORLEANS, Nov. 11.-At the seven
teenth annual convention of the America
Bankers Association this morning, lette
was read from Hon. Charles Foster, Secre
tary of the Treasury, detailing the opera
tions of the act of July IA, 1890, of whicl
the following are extracts:
The amount Of silver bullion purchases
with Treasury notes under the provisions o
the new law from August 13, 1890, to Novem
Der ], 1891, has aggregated Sc, 5SS, ,5S6 fin
ounces, costing $6s 626. .565, an average cost O
81 0S per fine ounce. From this silver 81,
s4s, AIS have been coined, and the remainder
is stored, in the shape Of fine bars, in tn
vaults of the mints as a reserve against th'
Treasury notes outstanding.
While the new silver law provides for tn
| purchase of nearly two and a half times tn,
amount of silver required by the act of 1873
the compulsory coinage and issues of 1000,
600 silver dollars monthly land of silver Ger
tificates representing such doIlars) is dont
away with. In lieu of such dollars Unitat
States notes of full debt paying power, re
deemable in gold or silver coin, at the
option Of the Secretary Of the Treasury, a,st
| having behind them practically gold dol
lars worth of silver bullion, have been sub
| stituted.
What the New Law Provides.
The new law provides for an annual in
crease of our currency approximatine
$50, 900, or, deducting the average retire
ment of national bank notes in recent years
an annual addition to our circulating me
dium of s24, 100000.
While it is true that the amount Of money
in circulation in this country at the present
time is greater than at any previous
period in our history, and more per capita
than in any Of the leading commercial ma
tion of France, 1 am of the opinion that,
population and wealth. and the
extraordinary development in all
circulating medium. some what proportion
ate to our growth in population, is impera-
lively demanded. The issue of Treasury
notes under this act affords such an In,
currency, based dollar for dollar upon the
cost value of silver bullion redeemable on
demand in gold coin, and with the pledge OF
the Government to maintain 1t at par =,
legal tender money is ever to be accom-
plished it can only be done by the action OF
nations of sufficient commercial Importance
to maintain some fixed ratio In coinage
between the two metals. The new silver
act is an important step in that direction.
A Step Toward demonstration.
First, because the compulsory coinage and
issue of silver dollars of less intrinsic value
than their nominal value is repealed; Sec
ond, because it provides for a much larger
absorption of silver by this country than
heretofore for currency purposes; and third,
because the new law declares that it Is the
established policy OF the United States to
ipf ", ho ma afa1S of UT
each other. 1t seems to me that the act
under consideration is decided improve
ment upon the provisions OF the act OF 1878,
which it repeals, in that it furnishes a sound
currency to meet the growing wants of our
country, and has a tendency to reduce the
difference in value between the two metals
and thus help to restore the equilibrium SO
much desired.
Prof Arthur Thadley, of Yale, read a
paper upon "Recent Railroad Legislation
and Its Effect Upon the Finances of The
United States" In substance he said:
If we look at the systems Immediately west
of Chicago, we find that since the passage of
the Interstate Commerce Law they have
shrunk in value $50, ,000, 900, or more than %
per cent of the par value of their stock.
This is nos unprecedented in amount. The
same thing happened in 1873 and again in
1855
Three Points of Popularity.
1t is peculiar in coming without crisis
in general business, in affecting railroad
securities alone, and in affecting different
groups of railway securities, according to
the amount of legislation to which they
were subject Such fall can only have
been due to legislative action.
The Interstate Commerce law, which had
been supposed to be the end of struggle
for railroad control, was only beginning.
The Interstate Commerce Commission ex-
tended its jurisdiction so that the law ap-
piled to many more things than was expect
ed. The individual States went further
dom than the Interstate Commerce Com
mission. Finally the prohibition of pools
prevented the railroads from taking meas
ures in self-defence.
This legislation, though ostensibly di-
rected against railroad abuses, was really in
considerable measure the result of hostility
to the corporations themselves. The rail-
road question in America is like the Irish
land question: Railroads are owned in the
East and operated in the West, just as the
Irish land is owned in England, and there
is an effort on the partnf the people who
use the property to fix the rates instead of
letting 1t be done by the people who own it.
Railroad Legislation Won't Succeed.
1t is not likely that this effort will sue
ceed High prices are result of scarcity
Wherever the consumers attempt to force
prices down by law they prevent such
scarcity from curing itself. The result is
shown in the almost entire stoppage of rail-
road construction in States like Iowa, whose
legislation has been reckless Although
local shippers want low rates they still
more want plenty of railroad service and
will not persist in legislation which will
prevent them from getting it.
The Committee of Schools of Finance
and Economy reported in favor of agitating
the subject and sending commissioner to
Europe to study the best system there.
The topic of discussion to-day was 'The
Banking System and Currency of the
Future" George S. Coe, of New York. |
opened the discussion and read paper on |
''An Inside View of the Financial Situa-
tion." He said that the conflicts between
The advocates of white and colored metal |
seems now an irrepressible one The only
obvious and practical solution is the ere
union in money Of those ancient but tenn
porarily discovered elements" John jay |
Knox continued the subject on another line. |
A Perfect Paper Currency.
The elements of aperfect paper currency
IF this or any other country, he said, are:
|, safety; 2, elasticity; 8, convertibility: 4,
The greatest and most i'm
portant of these is safety. The proposition
which 1 had the honor to present to Con-
yress was, in brief, the following:
That banks organized in this country |
should be allowed to issue q circulation upon |
10 per cent of their capital. A bank of $4OO,- |
700 capital should have the right to issue |
circulation to the amount of $3O0,OO0 Half |
Of that circulation would be secured by gold |
II silver coin OF bullion, or, if you please, by
The public debt, so long as it shall exist, or |
1ntil 1907 by Government bonds. The other |