The representative. [volume] (St. Paul, Minn.) 1893-1901, 1893-09-20

kinds. all debts due to the government
except duties upon imports, and all
debts due from the government, except
interest upon the public debt. It is not
then in debt-paying ability that tho
greenback is said to have deprecated,
but in exchange value, or purchasing
power"
But did the greenback so depreciate,
and how can we learn the facts in the
case? Certainly not by comparing its
purchasing power with that of gold in
the United States, because there was
no gold or silver money known to be in
the United States from July 1, 1852, to
July l. 1872, except limited quantity
upon the Pacific coast. The official rec
| ords and the reports of the treasury
and mint departments show no gold at
all in the United States for the period
named, but say, in foot note: add:
Specie in circulation on Pacific coast
SIS. 600, 0Oo." Up to July l, 1861, there
had been but $3.50, 0O0, 600 of both gold
and silver COINED and issued" and
supposed to be in existence. From july
1, 1851. to July 1, 1858, we produced
$l73, 412, 500 in gold, but our net loss by
export during that period was e163. $50,
3OO-leaving us less than $40, 600, 600 net
gain. On July 1, 1873, the United States
treasurer's reports first begin to show
specie In this country, and on that date
there is shown s135, 600, 600 in gold and
%, 149, 30o in silver. OF the gold, less
than $6S, 000, 900 was in the hands OF the
~ h.
eleven years gold entirely disappeared
from the channels of trade and was not
used as money at all. AS commodity,
| its value in the United States became
greater than its monetary denomina-
tional value, and l shall be able to
prove that, in the United States, it bore
as high a premium in English gold
money as in greenback currency.
know that the common, prevalent
idea entertained by all old green back
ers and most populists is that the
greenbacks really did depreciate below
par and that they did so because of the
exception clause printed upon their
back. It is also generally believed and
taught that the old demand notes,
which were legal tender for al debts
and dues, public and private, remained
in circulation and at par with gold all
through the period of the suspension
OF specie payments
Mr.. Ed G. Taylor, in the Star of Au-
gust Is, fairly expresses the common
understanding as follows:
up to this time april l, 1861, the
treasury notes issued all bore interest
and were payable at definite time, be-
ing intended as government loans and
not designed to circulate as money, al
though they served that purpose, being
receivable for all dues to the govern
ment, and payable for its obligations.
But by the act of July II, 1861, the Sec
rotary of the treasury was authorized
to issue $50, OOO, 900 in treasury notes,
without interest, payable on demand,
in denominations Of not less than $40.
which should be payable for salaries
and other dues from the treasury. And
by another act of August 5, 1851, the
lowest denomination of these notes
was fixed at IS and they were made re-
ceivable for all public dues. And on
February 10, 1852, 100000 more Of
these notes were authorized. By act
OF March II, 1862, these notes, known
as demand notes. were made legal
tender for all payments and receivable
for all public dues, including duties on
imports; they are the only notes ever
given in full functions of money, the
so-called legal tender notes, or green
backs, not being receivable for duties
on imports or payable for interest on
the public debt, and as a consequence
W hen gold went to a premium of g. IS
these demand notes ranked right along
with it,
The foregoing statement involves one
of those peculiar presentments charac-
terized as half truths" The truth is
that these demand notes remained in
circulation but short time before be-
ing presented for redemption and re-
deemed in gold, or received for duties
upon imports and Cancelled and de-
stroyed.
|. Although on December %, 1851, when
specie payments were suspended, there
were about $685. 600, 600 of these demand
notes in circulation, yet, because of a
circular issued by the government
pledging their redemption in gold, they
were made receivable for import duties,
because of the governments inability to
redeem them in gold. On July l, 1853,
there were only g, 351, a0'demand notes
in circulation. On July Il 1854, when
gold was at its highest, there were only
about $3.50, 600 demand notes in cir eula-
ton. By July /, 1858, this amount was
reduced to S141, 72s, and on July /, 1879,
there were but e61, 40 demand notes in
circulation. The government redeemed
them in gold when it could and they
were virtually gold. Gold was not in
use as money, but was cornered by
spectators and gamblers who enriched
themselves by taking advantage of the
| governments necessities. It will be
found that in the case Of commodities,
the prices of which are governed by the
price of the export surplus abroad, the
greenback dollar remained at par with
the gold money of England. In the
case of commodities not exported by us,
the price was governed by the volume
OF paper currency in circulation, gold
not being factor in determining prices.