Brookings register. (Brookings, S.D.) 1890-1894, 1893-08-18
THE FINANCIAL QUESTION.
Opinions of Distinguished University
Professors of Political and Econ
OmIc science.


OmIc science.
President Walker of the Mass. Inst.
of Technology:
The purchase clause of the Sherman
act should at once be repealed. This
will bring our legal-tenders out from
hiding and our gold back from Europe.
Better still, it will bring business con
lidence back from Bedlam. and will
prepare the way for a safe and health
full expansion of productions and
trade.
The repeal of the purchase clause of
the act of 1890 should be without
delay and without conditions: but it
should at once be followed up by legis-
latiOn providing for a we'll founded
system of national banks Of issue,
having an ample and secure basis of
circulation.
1t would do much to promote the
immediate interests of the country if
it were to be eauthoritatively announced
that tariff legislation prior to the
regular session of 1894 will be strictly
confined to an extension of the free
list, no changes whatever being made
upon articles which are to remain
dutiable. FRANCIS A. WALKER
Professor Taussig of Harvard Uni
versity.
The Sherman act should be repeal
ed,-SO much seems to be agreed on.
That nnlncky measure is bad in prin
ciple and dangerous in practice. 1t
makes the growth of the currency
depend not on any aScertained need,
but on the accident of the price of the
American product of silver. 1t pro-
vides for monthly issue which is
probably excessive, and has certainly
proved dangerous. The extent to
which it has caused the financial dis
turbance of the last few months has
been exaggerated: but 1t was beyond
question main cause of the feeling
of helpless diStrust, which is the first
occasion of all such pancky eXper-
fences.
What should be put in its place?
For one thing it will probably be best
for the moment to leave the present
volume of Treasury notes and silver
certificates unchanged. TO reduce
their quantity or substitute for them
other sorts of currency would bring
political and financial complications
which it is not necessary now to
invite. AS they stand, with further
increase stopped they can be kept
convertible into gold without serious
difficulty.
For the immediate future we ought,
so to speak, to turn the corner: give
up the mechanical process of issuing
currency on fixed silver purchases,
and adopt some method by which the
growth of the money supply is made
to correspond to the fiuctuating
needs of the community. 1t would
perhaps be possible for a sober and
conservative community to attain this
end by direct government issues, but
the dangers of such policy in the
United States have been yiVidly illus
trated by the history of the last twen-
ty years. The better plan is the old
one approved by experience: bank-nOte
issue. Congress should provide Sys-
tenn under which banks could freely
issue notes convertible into legal
tender ultimately, therefore, into
gold beyond a shadow of question.
The best plan is to enlarge the base
on which the national bank notes rest,
and 50 enable them ultimately to at
tain d dominant place in our every
day paper currency. The alternative
is to permit the issue of State bank
notes, under conditions insuring mod
Grafton and cOnvertiblity; the former
plan entails political difficulties, the
latter constitutional difficulties. The
brave policy is to meet the political
opposition and to cOurageously put
before the people the question
whether they wish to have national
bank money which shall be sound and
unquestioned, shall present no tempt
alton to currency tinkering, and shall
grow without trammels as the needs
Of the community spontaneously call
for increase. w. F. TAUSSIG.