The National tribune. [volume] (Washington, D.C.) 1877-1917, 1893-12-28


readers the cause of the worst panic this country
ever experienced. that Of 1s73., 1t seems hardly
fair to mention so many panics that occurred under
Democratic rule and not mention the only one that
the country suffered under Republican rule. II
my memory serves me rightly, during the panic OF
1873 every bank in Chicago. with one exception.
closed for Is days.. f. WIsEMAY, Go. ID, LIST
Ill. L. a.. 5l5 North Thirteenth street. Lincoln.
Neb.
We have heretofore discussed the panic
of 1873 very exhaustively, as our corre-
spondent would have known had he read
THE NATIONAL TRIBUNE regularly.
There are always what might be called
legitimate and necessary causes ofpanics, and
others that are illegitimate aud unnecessary.
The Legitimate and necessary causes"
SO to speak, are over-trading, oyer-specula-
ton, and oyer-crediting. The natural dis
position Of business men is to extend be
yond their resources, to buy or make more
than they can sell, and to incur more in
debtedness than they can pay. Every few
years it seems to become necessary to call
general halt all over the world, and force
settlements. Then We have panics. II it
were not for the special local features in
each country, these panics would be very
short-lived. Solvent business men would
pay up, insolvent ones would go into bank
ruptcy, the process would be completed in
few months, and then everything would go
on as before.
In this country there have always been
these special features, which have greatly
aggravated the severity of the panics, and
protracted the hard times much longer than
otherwise they would have been.
In 1919 we had the disorganization of
business by the war of 1S12J15, the wild
speculations in Western lands, and the
worthlessness of much of the so-called
money.
In 1887 we had the same experience with
worthless money, the same wild speculation
in Western lands, and the beginning of the
era OF reckless railroad building.
In 1857 we had mere trouble with the
immense quantity of wildcat money" put
in circulation; we had hundreds of mil
lions of dollars put into railroads that were
never completed, and our manufactures had
been Frustrated by the free-trade legislation
of 1916. Even the immense influx of gold
from California could not prevent the panic.
The panic of 1878 was precipitated and
intensely aggravated by causes special TO this
country. We had actually spent Sc, 10000
000-or more than three-eighths of the entire
valuation of the property of the country in
1S60-in the prosecution of the war. The
people of the South had lost over ST ,000,-
100000 worth of property they had in
slaves. This, and the expense of the war
to them, probably made their losses 5000
100000, or more. Next, about 100000
young men-the wealth-producers, North
and South-had for four years ceased pro-
stroying it. Then, the value of every bit of
property in the country had been democrat
lied by the imitation of the currency, and
everything had to be painfully brought back
to gold basis. Then, we had had such an
never seen before. We built the immense
Pacific railroads, and everywhere were long
vance of the country. The countless mill
lions invested in them were temporarily as
completely lost to the owners as if the
money had been burned up. On the top of
all this came the great Chicago and Boston
fires. which wiped out hundreds of millions
of dollars worth of property. Considering
all things, it is amazing that we got through
the trouble in six years. 1t is to the high
est praise of the recuperative power of our
people and the wisdom of the statemaDship of
that day that we escaped general bankruptcy,
and that general prosperity came as soon as
it did. Other nations-such as Spain and
Austria-have not been able to recover from
much milder crises in century.
The only thing that aggravates the panic
of 1888 is the criminal tinkering with the
tariff. We had everything else to favor our
speedy recovery from the panic. Our money,
in the first panic in our history, was perfectly
good There was nowhere dollar of doubt
full value. There had been absolutely no
great destruction of property. There had
been very little railroad building, and that
of only what was needed. There have been
no wars or rumors of wars. There was abso-
lutely no reason why the whole panic
should not have been over by Sept. and
everybody going ahead as usual. The only
malign influence was the certainty of reck-
less and radical tariff legislation, and this
laid the chill hand of death on every bud
ding hope The prospect of free wool de-
stroyed the value of 350, 900, 900 pounds of
wool which the farmars had shearad from,