Dakota farmers' leader. (Canton, S.D.) 1890-19??, 1893-09-29
The Leader.
MONETARY PRINCIPLES.

g.
A Plain Statement Why We Must Have
Free Coinage.
The following statement of monetary
principles has been submitted to all the
leading men in Washington. including
several economists of National and Euro
pean reputation, who are opposed to the
single gold Standard, and it has been
agreed to make the fight in the future on
the principles here enunciated:
!. Money is not commodity or a
material thing in itself, but it is Il mater
ial thing upon which the function of
money-legal tender-has been conferred.
Money means, therefore, whatever is ap-
pointed by law to redeem all currencies
and pay all debts.
2. In the United States, by the organic
law, the function Of preliminary redemp-
tion money has been conferred upon coins
Of silver and gold only.
3. Whatever circulatcs as money is
commonly termed currency and may
consist of coin or paper, and the paper
may be legal tender, as greenbacks or
Bank of England notes, or may consist OF
credit or promises to pay money which
circulate because of the confidence of the
people that, upon demand, they will be
redeemed in lawful money. National
bank notes are one form of credit money.
1t is customary to refer to. the whole
volume of outstandlnding money and
currency together rs the currency 'or
money in circulation.
i. The quantity of credit currency
which may supplement basic money. or
contribute to the volume as Il whole, or
the proportion which may exist between
such currency or primary money, varies
with varying conditions; but there is a
limit Of safety beyond which, if credit IS
carried, confidence is undermined and
the system breaks down, which condition
is always attended with panic and follow
ed by money stringcncy, failure and
business stagnation.
S. The purchasing power of money, or
its value stated in commodity price, de-
pends upon the quantity Of money in
circulation as compared with transactions
that have to be paid in money. @
6. If the purchasing power Of money is
to remain reasonably uniform in its rela-
tion to commodity prices, and with the
increase in population and the extension
of commerce, these conditions must be
attended by an equivalent increase of the
money volume.
Z. Since the decentralization Of silver in
1878 money of ultimate payment or
standard money has been more and more
restricted to gold alone. and rs the
supply Of standard money controls the
entire volume that may be based upon it,
other forms of currency have necessarily
been more restricted than they would
have been with both gold and silver ms
standard money. In the meantime pepu-
lation and commercial transactions have
increased far more rapidly than the
supply of gold. consequently the
purchasing power Of gold has largely in
creased. which is equivalent to the fact
that. since 1878. the prices of commodi-
ties generally have continually fallen.
s. Indeed. it is generally conceded
that the purchasing power of gold, has
risen more than 60 per cent. since 1878;
that it is still rising, and under present
conditions must continue to rise ut an
rate; that prices have fallen;
that they are still falling. and must con-
tinue to fall rs gold rises. .a
8. To put out more credit currency
in gold. rs some propose. will
prove no remedy, but. on the other hand.
would aggravate the evil Nothing will
cure this disorder but more gold, or re-
store the function OF primary money to
silver, as it existed before 1873. More
gold we cannot have; it does not exist;
but on the other hand. is continually be-
coming scarcer. What the world now
requires therefore is more standard
money to redeem with. and not more
promises to be redeemed in gold.
10. Il bimetallism were re-established
by comforting free aud unlimited coinage
again on silver, as it is on gold, the
volume Of monev would be increased in
a proportion much nearer to the increase
of population and commercial transac-
tions. than there is any possibility Of at
tanning while the money function is con-
fined to gold alone.
II. By again including silver there
would result such IN increase in the
volume of money rs would at once end
the continued fall in the prices Of COM
modities which has taken place since
1873. 1t would prevent any further fall
in general prices. arising from the gold
standard, but woali not interfere with
the cheapeming of goods, brought about
by inventions reducing the cost Of pro-
duction. -..- -.....,
II. This arrest Of the fall of prices
would again produce stable conditions
under which merchants, manufacturers,
farmers and traders may count on certain
profits, which would lead to larger bust
ness. Industry would be stimulated and
trade revived. 1t would increase the de-
mand for labor, increase wages and en-
large profits in accordance with the
nat,,ra! laws of supply and demand.
13. II, as the result of the money of
the country being put upon IL natural
basis, prices OF commodities should tend
upward, what the entire class of manu-
facturers, farmers. traders and workmen
gained us producers, would more than
them for the extra prices
which they might, or might not, have to
pay for commodities us consumers; for
producers always produce more than
they consume. and in the case of II rise,
they would gain on the whole amount
produced, while they would lose only on
what they had to purchase; tie rest of
The (assumcd) increase in The price OF
commodities being borne by the class of
non-producing consumers.
Ia. The non-producnG consumers,
losing temporarily by the as
sumed rise in prices, would also benefit
I'll J&,,l