People's party paper. [volume] (Atlanta, Ga.) 1891-1898, 1892-08-26
RATIOS ARE LEGIsLAr1vE

Again, not only is the monetary
use of gold and silver an artificial
one, but when the coinage is free it
absolutely controls the market value.
The reason is obvious. Under a free
coinage pound Of metal is convert
ible into certain number of dollars
free of charge. Manifestly it is worth
Just the number Of dollars it will
make.
And yet some people seem to
think that because an ounce of stand
ard gold will always coin into 1855
it's value never changes. SO the
ratios between the metals for the last
two or three hundred years have al
ways been legal ratios.
IL all nations had adopted the same
ratio, that would have been the uni
versal market price. But as the
ratios have generally differed, we find
small market variations within the
limits of the legal ratios of different
countries, Prior to 1885 there was
not a market in Europe in which the
ratio was 153 to l. They ranged
from little above IA to almost 16 to
1, but nowhere was the ratio 151 to
|. In that year it was deemed ad-
visable to recon the French Louis.
De Colonne, the French minister of
finance, advised the ratio of 151 as a
fair average. In England it was
about Isl, in Portugal 1544, in Spain
15B, IN France 14S. All the other
European ratios were below Is. So,
considering that Portugal furnished
England with gold, while France
drew her silver chiefly from Spain,
DeColonne concluded that 154 was
the safe ratio for France, and accord
ingly recoinago took place at that
rate.
A little later, when Hamilton was
considering the ratio to be adopted
by the United States, he concluded
that the French ratio was erroneous,
and that jusfaverage~of European
ratios was about Is, which was estab-
ished by the United States. Mr..
Hamilton may have been right; Is
to l was possibly the true one prior
to 1875; but Hamilton overlooked
the fact that when a great, powerful
and wealthy nation like France adopt
ed the ratio of 15a that action itself
became tremendous force in fixing
the true rate. AS a historical fact
it became the absolutely controllin g
force. The American Republic was
then in its infancy, poor and feeble
and its ratio of Is became com
plete nullity.
In 1884, perceiving that a mistake
had been made, the American ratio
was changed. But instead of placing
ourselves in alignment with France
we went to the other extreme, and
adopted the ratio of Is, or more &C
curately, 1898. By our first ratio
we undervalued gold and overvalued
silver; by our second we overvalued
gold and undervalued silver. Both
were therefoTe nugatory. But it was
only because France was SO much
richer and more populous than we,
and her conditions were such that
she was capable of absorbing and
using vast quantities of both metals,
thereby controlling their relative
value. So gentlemen will see that
the condition which made silver 3
per cent. more valuable in Europe
than in America was an artificial one.
Our silver did not go to Europe be-
cause 1t was worth more to the sill
versmith there, for it was not. The
prices of merchandise, including sill
verware were generally higher here
than IN Europe. It was attracted by
the French coming rate.
CHANGED CONDITIONS.
It is urged, though, that, con-
ceding force of the action of France
prior to 1873. conditions have