Evening star. [volume] (Washington, D.C.) 1854-1972, 1893-08-05
The Cause of Financial stringency.

10 the Editor OF The Evening Star:
AS the time for the extraordinary session
or Congress approaches, would it not be
advisable to ascertain. If practicable the
moving, substantive causes of distrust and
of stringency in matters financial and eco
nomical? Many people will say at once
1t Is the laundering and criminal legislation
OF Congress in respect of silver and the
tariff. Others with equal confidence insist
that neither the monetary system nor the
tariff has anything at all to do with 1t,
but that the seat of all the business
troubles is the apprehension that Congress
is going to readjust the tariff. Others again
will tell us that the present depressed con-
dition of affairs is due to waste, extrava-
gance and overspecuation. which has dis
counted by at least ten years the possible
material wealth of the nation. The number
is not few who look with dread upon the
approaching session, fearing that the rash
or unwiSe interference of uniformed or
currency blinded legislators will aggravate
instead of paliiating the situation. What
ever may be the proXimate causes of the
depressed condition of business affairs in
this country, 1t Is the part of statesman
ship to endeavor to relieve it, II within the
domain of legislative competence. If 1t Is
outside this domain we must look elsewhere
for remedies and correctives. Now l be-
lieve economists agree that wealth is ac-
cumulated by degrees-d by the occupation
soil, 6, by scientific invention, and "a by
the economy of the producers. These may
be called the substantive causes of wealth.
and of all these the economy of the pro-
ducers'' is the most important factor.
When seeking for cause OF causes for loss
of wealth-or for what is the same thing
in effect, q dminution depreciation in
current and available value of what usu-
ally constitutes the representative of the
wealth of a nation-regard must be had to
the waste of both producer and consumer.
In this view, may it not be that the waste.
extravaganza and transportation of our
people have contributed largely to bring
upon us the present depression? l am only
a seeker after the truth; but it seems to
me that there are several contributing
causes which have brought about the pres
ent condition of affairs, which Is exceed
ingly embarrassing. and these are SO inter-
laced and interdependent that it is difficult
to recognize in what proportion each has
contributed to the general result, 1t may
well be that the distrust with which many
millions of people regard one of the metals
which the United States has been stamp
ing and sending out as standard currency
has much to do with it. But 1t is not in
the way in which most people consider It.,
Writing in 1883, an economist OF the lib-
eral school in France said: The issue of
all the wealth in negotiable vouchers and
the incessant transfer Of valuations SO
modified is the characteristic innovation of
modern times. This tendency to stir up an
already preponderatng commerce, made
universal because the merchandise uron
which 1t operates. capital sums up all other
merchandise, is the great force of modern
human activity. This commerce. legitimate
and necessary in principle, but mysterious
in many aspects opens a career for sl's-
picious gambling and fraudulent schemes.
This traffic in capital which renders such
service. at the same time that 1t counte-
nances great abuses. has not been studied
closely In any country. In France. as else
where no doubt, 1t has been controlled a
little at haphazard, as the result of customs
which have had the force of rules. The
time has come to throw light on this great
movement. To regulate 1t. to reclaim it,
if possible. has become for our time an act
of political prudence. a social necessity"
Making use of the above extract of Andre
Cochut. NJ. Jannet in his work on Capital.
Speculation and Finance in the l9th Cen
tury." opens the way and proceeds to the
discussion involved and indicated by the
title of his very valuable work. If not yet
translated into English it should be trans
lated at the public expense and copy
should be placed i'm the hands of every
member of Congress and of every public
official The outlay would. or at least
should, bring better returns at this junct-
ure than the circula ton of the Congress
ional Record, the distribution of seeds
by the Agricultural Department
Yours truly,