Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1893-01-11
The Consequences Of Coinage.

There seems to be reason to state once
more the grounds for refusing free coinage
of silver By the United States alone. For
that purpose it may be well to start with
propositions which cannot be c0ntr0ver ted.
/. Whatever price may be maintained
for silver in this country it will be possible
for other countries to get for their surplus
silver through free coinage here.
If the silver dollar here is he'll equal to the
gold dollar the bank of France,
alone can draw from this country
over s250,000,0 in gold, which is more
than the entire amount held in the treasury
1t is safe to say that, out of SO 900, 900 600
of silver i'll circulation, more would be sent
here for gold within short time than
enough to take away the s239 900 900 in
gold held by the treasury, if silver is main
tanned here at par with gold. Any holder
who can turn G4-cent dollars into l0O-cent
dollars, or 100 ounces of silver bullion into
sl29.25 in gold, by merely sending it to
the United States for coinage, will not
hesitate long.
=. Withdrawal of much less than the
amount of gold now held by the treasury
would be sufficient to establish and main
tain a premium on gold. Only a little
Z
tain their gold for a higher premium, and
refuse to pay it out in ordinary transactions,
so that the circulation would be at once
contracted for all practical purposes. by
the s4i0, 900 900 of gold coin, and Sl23,-
0o0,O0 of gold certificates now outside the
treasury. Long before $500, O00, 900 of
gold had gone out of the country in ex-
change for silver against which paper could
bsa isanoI nnortxy
would have gone out of circulation. 4
more violent contraction no one has pro-
posed.
3. Should the treasury attempt to resist
this debasement of the currency by offering
bonds for gold, with the mints open to sill
yer, foreign holders of silver could afford
to bid for bonds, ship their silver to the
United States, and get for it here the gold
to pay into the treasury. Thus for unavail-
able silver they would get bonds of the Uni
ted States to pay gold and bearing interest
in gold. With free coinage in this country,
the endearor TO draw gold hIthcr by offer
ing bonds would be of no avail
I. With gold at a premium here. and
circulating notes practically redeemable in
silver, and therefore at discount, all the
industries and trade of this country would
bS at u AtdiAui AisdiN Us ttitf were
ia the weary years prior to specie resump-
ton. As paper depreciates it loses part of
its purchasing power, so that another and
greater contraction of the circulation would
result. Wages would lose part of their
purchasing power or value, and labor would
lose part of its savings.
). Foreign powers, now sorely pressed
by the disasters resulting from depreciation
. a,tx h., ii. l.. Al.
selves relieved for some years from their
pressing troubles by the performance of
the United States. Enriched by our gold,
able to get rid of part of their useless sill
YER, they would have no longer strong
motive TO agree upon free silver coinage.
Ga the contrary it is obvious that they
would find great profit in retaining a supe-
rior currency, everywhere redeemable in
gold. ami in milking this country as long as
possible through its use of an inferior
currency.
g. The notion that silver bullion in foreign
markets would be lifted at once to the level
Of gold byAfree coinage in this country is
not so absurd as the notion that it would
stay at par after Withdrawals of gold had
started premium here. Before pprchases
of silver began under the act of 1890. sill
yer bullion was lifted suddenly by specula-
ton to 81 20 per ounce. but the anxiety OF
holders to realize put the price down again
very rapidly, and it fell to the lowest point
ever known.
When Don Quixote set lance in rest AMI
rushed full tilt at a windmill, he was a SEN
sihle person in comparison with those who
fancy that an act of Congress can make
silver worth par in gold throughout the
civilized world. But if that is not possible,
free coinage by the United States alone
would involve incaiculable disaster.