The Democratic advocate. [volume] (Westminster, Md.) 1865-1972, 1893-08-12
The Presidents Message.

Cleveland to Congress today:
To the CONGRESS of The United States The
existence of an alarming and extraordinary,
business situation involving the welfare ana
prosperity of all our people has constrained
me to call together in extra session the peo.
niles representatives in Congress to the end
that through a wise and patriotic exercise oil
the legislative duty with which they solely are
charged present evils may be mitgated and
dangers threatening the future may be avert
ed.
Our unfortunate financial plight is not the
| result of untoward events nor OF conditions
related 10 our natural resources, nor is 1t
traceable to any of the Affections which fire.
auenily check national growth and prosperity.
| With plenteous crops, with abundant promise
| of remunerative production and manufacture,
with. unusual invitation TO safe investment
and with satisfactory assurance to business
enterprise, suddenly financial distrust and
fear have sprung up on every side. Numer-
4 Gus moneved institutions have suspended
because abundant assets were not Immediate
ly available TO meet the demands of frighten-
| ed depositors. Surviving corporations and
individuals are content to keep III hand the
money they are usually anxious to loan, aud
those engaged in legitimate business are sur
prised to find that the securities they offer for
| loans, though heretofore satisfactory, are no
longer accepted Values supposed to be
fixed are fast becoming conjectural, and loss
and failure have involved every branch of
business.
Ibelieve these things are principally charge
able to congressional legislation touching the
purchase and coinage CT silver by the general
government.
This legislation is embodied in II statute
passed on the 18th day of July, 1890, which
was the elimination Of much agitation ON the
subject involved and which may be consider
ed a truce, after long struggle between the
advocates of free -silver coinage and those
intending to be more conservative.
: Undoubtedly the monthly purchase by the
4 government OF four million and five hundred
thousand ounces of silver, enforced under
that statute, were regarded by those interest
ed in silver production rs a certain guaranty
of its increase in price. The result, however,
has been entirely different, for Immediately
following spasmodic and slight rise the price
of silver began to fall after the passage of the
act. and has since reached the lowest point
ever known. This disappointing result has
led to renewed and persistent effort i'll the
direction of free silver coinage.
Meanwhile, not only are the evil effects OF
the operation of the present law constantly
accommodating, but the result to which its exc
cution must inevitably lead is becoming pal
pable TO all who give the least heed TO inan-
cial subjects.
This law provides that in payment for the
four million and five hundred thousand ounces
of silver bullion which the Secretary of the
Treasury is commanded to purchase monthly,
there shall be issued treasury notes redeem
able ON demand in gold or silver coin at the
discretion of the Secretary of the Treasury,
and that said notes may be reissued. 1t is,
however, declared in the act to be ''the estab-
lished policy of the United States to maintain
the two metals on n parity with each other
upon the present legal ratio, or such ratio us
NAV be provided by law" This declaration
SO controls the action of the Secretary of the
Treasury as 10 prevent his exercising the dis.
erection nominally vested in him and by such
action the parity between gold and silver may
be disturbed. Manilestly a refusal by the
Secretary to pay these treasury notes in gold
if demanded, would necessarily result in then
discredt and depreciation obligations pay
, able only in silver and would destroy the
parity between the two metals by establishing
n discrimination in favor of gold.
, Up to the 18th day of July, 1893, these
notes had been issued in payment of silver
bullion purchases to the amount of more than
one hundred and forty seven millions of dol
lars. While all but q very small quantity oil
this bullion remains uncoined and without
: usefulness in the treasury, many of the notes
qiyen in its purchase have been paid in gold
/, This is illustrate by the statement that be
tween the LIST day of May, 1892, and the 15ti
day of July, 1898, the notes of this kind ISSUED
in payment for silver bullion amounted 10 1
little more than fifty four millions of dollars
, and that during the same period about forty
nine millions of dollars were paid by thu
, treasury in gold for the redemption OF sucl
notes.
The policy necessarily adopted of payin,
these notes in gold has not spared the gol'
reserve of one hundred millions of dollar
long ago set aside by the government for The
redemption of other notes, for this fund ha
5 l,slready been subjected 10 the payment o
new obligations amounting TO about one hun
dred and fifty millions of dollars on accoun
0 of silver purchases, an has, as consequence
: for the first time since its creation been en-
croached upon.
! We have thus made the depletion of GU
gold easy and have tempted other and NOR
+ appreeiative nations to add it to their stock
, That the opportunity we have offered ha
i not been neglected is shown by the larg
: amounts of gold which have been recenti
drawn from our treasury and exported to in
crease the financial strength of foreig
nations. The excess of exports of gold owe
its imports for the year ended June 30, 1888
amounted to more than eighty seven and a
l half millions OF dollars.
- Between the first day of July. 1890, and tn
5, 18th day of July, 1898, the gold coin and bul
is lion in our treasury decreased more tina
n one hundred and thirty two millions OF do
y lars. while during the same period the silve
e coin and bullion in the treasury increase
lie more than one hundred and forty seven mil
&c lions of dollars. Unless government bond
y are 10 be constantly issued and sold to re
is plenish our exhausted gold, only to be agai
n exhausted, it is apparent that the operatio
Sc of the silver-purchase law now in force lead
r. in the direction Of the entire substitution {
ID silver for the gold in the government treasury
is and that this must be followed by the pay
sr ment of all government obligations IN depr'
ir GATED silver.
J. AT this stage gold and silver must pa
company and the government must fail IN u
lie established policy to maintain the two meta
ID ON parity with each other. Given oyer
ID the exclusive nse of currency greatly d
y nreeiated according to the standard OF th
commercial world, we could no longer clai
in a Mace among nations of the first class, nj
IS could our government claim performance
y, its obligation so far as such an obligation hi
* been imposed upon it, to provide for the US
e. of the people the best and safest money.
II If. as many of its friends claim, silv'
OF ought to occupy larger place IN our cn
" rency ana the cuFrtncy W thS "o'N s'"pus
d, general international co. operation and agre
meut, it is obvious that the United Stat
will not be in position 10 gain n hearing
favor of such an arrangement so long as v
are willing TO continue our attempt to accou
C. plish the result single handed.
,k The knowledge in business circles anon
of our own people that our government cann'
10 make its fat equivalent to intrinsic vau
IS, nor keep inferior money an a. parity WI
nd superior money by its own independei
efforts, has resulted in snch lack Of con
n, dence at home in the stability Of curren'
al values that capital refuses It's aid to new e
q. terprises, while millions are actually wit
Of drawn from the channels Of trade and con
al merce, to become idle and unproductive
ID the hands of timii owners. Foreign II
rt vestors, equally alert, not only decline
nd purchase American securities, but mai
~ haste 10 sacrifice those which they alrea'
be have.
1t does not meet the situation to say tn