The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1893-08-19
A CHANGE or RATIO NO RELIEF.

From the time OF EDWARD III the MS
tory Of England's national finances are
fail Of illustrations OF the trouble arising
from the divergence between the legal pro-
portions Of value Of gold and silver and
the market value Of the two metals.
Sometimes gold was legally estimated too
high, sometimes silver. The money metal
that vas underyalEed in the legally estab-
lished proportion, of course, took 10 flight:
It was worth more in the melting
pot than IL was as coinage, 80 that
~ one tine England's silver coinage
vas melted and exported 10 France,
where it was sold as bullion. and England
was left with only gold coinage. Then
the legal proportions Of the metals were
changed by the government. but the old
conflict between the coinage value and the
bullion value soon broke out again and
the process of Withdrawing one metal
from circulation and exporting it was re-
peated. OF course international bi-met-
aiiisn would have prevented this flight of
the undervalued silver coinage Of England
TO the melting pots of France, but the
frightfnl, ceaseless wars which ragged be-
tween England and France up 20 Water
loo made any statesmanlike bi-metallic
union between the great commercial ma
tions Of Europe impossible.
Our own country furnishes ample illus
tration of what follows when any metal is
coined into legal tender money at nom-
NAL value above its real value. From
i792 to 1884 our government coined SILVER
at value above the market, the ratio
being Is 70 1. and the result was that
silver alone remained in circulation. Just
as gold alone remained in circulation
ia England when her ratio was 15I to
against that of France. which was under
Is TO |. Since 800 in gold would buy
silver bullion that could be coined at the
minis into more than 800 generally from
si0i TO si03). the gold vanished and the
silver only remained. In 1884 the ratio
was changed to 1 to los Cor roundly to
49,. and at this ratio the gold coin was
worth more than gold bullion. Since 800
in silver would buy more than 800 in gold
bullion. most of the time, for the next
forty years. about sos, the silver vanished
and the gold remained.
Here were two periods of about forty
years in our history when first gold and
then silver took to fight owing to under
valuation in the coinage. In both periods
there was free. unlimited coinage of both
metals into legal tender coin. There was
no difference. save in the ratio. The New
York Times recites these monetary facts.
familiar to every reader of our financial
history. and points out to the silver pro-
ducers that the same force, underyalua-
ton in the coinage, would act i'm the same
way at present and that their metal could
only be kept in circulation on q par with
gold when the ratio set by law was the
same as the ratio in the market, which
cannot be predicted even for a very short
time. Says the Times:
Suppose the present market ratio. about
10 y. be adopted. To begin with, that
would be proclamation by the silver men
that they had no confidence in the future
OF their product. Ii silver should advance
TO so cents an ounce the ratio would be
about l to 20.s. and there would be no
more coming. suppose the ratio of 10
(which has been suggested - were
adopted. That would be the equivalent of
~ cents an ounce. If silver advanced by
even half cent beyond that
hgure, the coinage would cease The
same thing would happen. whatever
ratio were adopted, If the market price
went beyond the coinage value The
silver men cannot hope for any ratio vary
ing much from the market ratio, and the
market ratio is at present SO auctuating
that they cannot afford 10 have 1t embod-
led in law. On the other hand, If free
coinage lie abandoned altogether there
VIII be taken from the market a disturb
ing element. and their business will be far
more stable. and in the long run far more
profitable,
The Times points out that the same view
OF facts is equally important to the debtor
class. With the price of silver rising and
falling as IL has the last three months. free
coinage will subject the debtor class to an
enormous risk, no matter what ratio is
adopted. We quote:
suppose they take the present market
| ratio OF TO =, and silver advances in
| price. as they think il will; not only
would coinage cease. but ali the silver in
circulation and all that could be got out of
the treasury on silver certificates or other
government paper would be melted up and
sold out of the country. How would the
debtor class regard the action of their rep
fesehbANfss thcta n.t suppose SILVER. IN
stead OF advancing. should decline. then
the gold that might be in circulation
would disappear, as 10 has done within a
! few months. NJ the mere prospect of gold
| payments becoming impossible. The CON
| traction would be equally violent and dis
| astTous. and the Debtor class would again
| suffer. IL the time Is ever To come " heu
! silver can he safely coined without limit.
| II must be when the market ratio TO gold
/ Is iairiy steady. which u Is not now, aud
/ Will nos be iu long time vet"