The herald., 1893-07-03
ADiatribe Against+he Dollar
Of the Daddies.
Silver Scored by a Senile Mis-.
souri, Statesman.
A Letter to Secretary Carlisle on
the Financial Question.
Ex-senator John b. Henderson Essays
to Solve the Knotty Problem
to the Satisfaction OF
the Gold Bugs.
By the Associated Press.

By the Associated Press.
WASHINGTON, July 2.-Ex-SenatoY
John B. Henderson of Missouri, who
has devoted a long and careful study to
matters of finance, has addressed to
Secretary Carlisle the following COM
munication:
Il promised to give you in writing the
substance of my statements made to
you in convention touching the none
tary condition of the country. I then
expressed the belief that the present
stringency was produced, not by any
lack or insuficiepcy of our currency,
but by the loss of confidence produced
among business men because of the bad
quality or inferior character of large
part OF that currency. There is no error
of more common prevalence than that
an abundance of money Issues naturally
adds to the commercial or business en-
ergy of the people,. OF course certain
amount OF money tokens is absolutely
essential with which to effect the small
er exchanges of commodities.
These money tokens do not
create exchanges, but exchanges create
necessity for the tokens. Among people
entirely civilized over 95 per cent of the
exchanges necessary in these operations
are contaminated through the medium
of bank checks. Experience demon
strates that these bank facilities become
enlarged or contracted as money tokens
become scarce or abundant; hence there
is less danger in limiting the bulk of
circulating money than the people gen.
orally imagine. A bank check is better
70 81
its Office 1t ceases to 'circulate. If the
check, it is issued anew, and in like
manner destroyed when its object is ac-
conplished. We shall never have O
perfect currency until every note used
for circulation shall be destroyed or re-
turned to the authority issuing it and
no new notes issued, except for value
and only at the call OF business de-
mands."
Commenting upon the amount of
money in circulation per capita among
the people of the United States from
1878 to 1898, Henderson says neither
individual prosperity nor commercial
prosperity nor commercial activity are
absolutely controlled by the amount of
the circulating medium. Continuing,
be states: sir ief
think I am safe in asserting that
from July l., 1879, to July l, 1888, we
enjoyed very great prosperity, indi-
vidually and nationally. There was no
lack OF money. 1t autficed not only to
ill the treasury, but abundantly an
swered the demands of commerce, and
extraordinary business activity was
followed by very high prices. The
average per capita circulation during
the period WAS s20.6l. From July,
1890, to the present period of great
monetary stringency, we find an aver
age circulation per capita of $23.65. II
is. therefore, apparent in COM
mon parlance, that times NAV
may be hard and money scarce
with the most abundant circulation peI
capita. The circulation in Great Britain
now is $l9.34-s14.49 in gold, silver
s2.63 and paper 1924 per capita. The
circulation in Germany is $17.56, and
yet in these countries, with vast com.
merce and manufactures, there is no
dearth Of money and interest rules at
scarcely more than half the rates pre-.
vailing in this country. England has
adopted single gold standard in 1915
and has adhered to it ever since, and by
30 doing has become the money center
OF the world.
The panic of 1878 was without doubt
the direct result of the speculation and
overtrading induced by the greenback
era. Between 1863 and 1873, both in
elusive, the balance of foreign trade
against US WAC 81 ,086, ,440,5 ,5S7. This long
and steady drainage brought the loss Of
a large part of the nations wealth, and
with it the country's entire stock of
gold. Take the period of unbridled
state bank Issues of paper money be-
tween l84S and 1867, we find similar
result. The commercial conditions now
existing are altogether different from
the two periods named.
It seems to be demonstrable, 30 far as
a financial proposition can be logically
demonstrated, that the present situa-
tirn is not the result of speculation, of
overtrading or bad business methods,
but largely. if not wholly, produced by
the silver legislation of congress. The
increasing production of silver, as COM
pared with gold, induced Germany to
follow England and discard it as a twin
standard value. The American congress
in 1878, actuated no doubt by. these
views, adopted, without dissent, sim
gle gold standard. Two years after
Watu AhOabutc Wdo duu
passed for the resumption of specie pay
ments, to become operative January /,
1870. If these two measures had re-
manned on the statute books inviolate
and unsmended. there is no economical
reason why the United States and the
people should not today enjoy most un-
bounded prosperity. We should have
had the best and most abundant cur
gold currency OF universal
value and such volume as to force its
as in England, France and
Germany, into the hands of the people.
70 be assured OF this fact 1t 10 only nec-
sssary again to examine the condition
If commerce for the last seven years.
Although the excess of our products in
1892 amounted to nearly 5000, ZOO, 900,
ret the most startling fact appears that
Turing that year we exported over $l3,-
700, 900 of gold, and now the balance Of