The times. [volume] (Richmond, Va.) 1890-1903, 1894-10-04

4
| Now this is in every respect as dan
| gerous and as false doctrine as the propo-
| sitIon that this Government shall under
take free coinage alone at ratio OF 10 IL
| TO 1. II is the essence. too, of the Popu-
| LIST doctrine about money. The Popuiist
| says that the true value OF money is III
| no way whatever connected win l'e
value Of the material from which money
is made The true value OF money says
he. depends upon its character OF ieea,
tender Anything, says the Popuiis'' WIN
do for rnoney-oak leaves as well as green
paper--lf IL is made by the Government
legal tender In payment OF dep''
Is the whole OF the Populist ~.
about money, and that doctrine Is ""a'
is involved in the quotation we
from Senator HIS speech
Now I'm pojnt OF fact. the legal tehuer
character OF money has nothing Whatever
TO do with its value-that is its aDlIlly
IN nerform the functions Of money. Ihe
univ usefuI part legal tender quality can
nerform I'm money Is TO force settle
ment between men who have fallen out
and are unable TO agree about their rights
and liabilities The debtor says he owes
sIo0 the creditor claims that he owes
s9oe The debtor tenders one hundred dol
lars that are endowed by law with the
quality OF legal tender, and II II shall
thereafter turn out when the questions
between the parties are tried that SloO
was all that the debtor owed. he VIII
have done his full duty by rendering the
800 and all losses and damages that nave
since accrued will fan on the creditor
and not on the debtor. This Is the soli-
tary useful function that can flow from
money being made legal tender.
But II its legal tender quality is relied
on TO make it useful for serving the pur-
poses OF man in transacting business, 1t
viii be found at once that it loses all us
useful purposes as money. IL money Is
to be of any value TO man 1t must DE
money which men willingly accept In their
transactions. The moment the money-De-
comes what they are unwilling 10 receive,
but are forced TO receive by c1mpulsion
and restraint of law.it totally loses It's pow
er to be useful. Men viii not Willingly ex-
change their property for il, and though
they are compelled to receive II in pay
ment Of debts then due, they will be
careful to give no more credits for which
they will be forced to receive it. Val
liable money then is money which men
receive willingly and from choice.
Money that men can be forced to receive
is necessary for settling disputed transac-
lions, but it's compulsory element is of no
sort of value for the operations Of barrier
and exchange.
In our article Of some weeks back, In
reply to MIR. Eustis, we said that money
had nothing to do with the values of
commodities. A correspondent takes us
up on this, and says it is so radical that
he cannot believe we mean II seriously.
Nevertheless, we assure our friend that
we do mean it seriously, and he will never
understand this business until he gets
that identical idea distinctly into his
head.
Money performs two functions and
only two. The first Is its function of stan-
dard Of value; its second, that of
medium for effecting exchange Of com
modities. 1t effects its functions OF stan
dard OF value thus: IT takes a day of
labor, we will suppose, to dig % $40
we arbitrarily call a dollar. It takes n
day Of labor. we will suppose, to produce
q bushel Of wheat. and a halliday OF
labor to produce a bushel Of corn. Since
there is the same labor required for pro-
ducing the bushel of wheat as for pro-
ducing the gold dollar, we say a bushel
Of wheat is worth a dollar, and since
there Is only half as much labor required
to produce the bushel OF corn, we say a
bushel Of corn Is worth a half-dollar.
The dollar, then, has done the service
of establishing a basis upon which corn
s to be exchanged for wheat, and this
Is what We call doing the work of a
standard of value.
1t performs its second function thus:
A, at jamestown, has one hundred bush
els OF wheat, which he does not need,
but he wants one hundred yards of cloth,
which are fifty miles away at Johnstown.
He meets with Il, who has one hundred
gold dollars and needs one hundred bush
els of wheat A exchanges his wheat for
the gold dollars. Why? Because he knows
that it has taken the same labor TO pro-
duce one hundred yards OF cloth as to
produce one hundred gold dollars, and
that the cloth owner will, consequently,
exchange his cloth for the gold dollars.
He might have taken his wheat TO the
cloth man and have snapped the two d.
rectly. But wheat is unhandy to carry,
and the cloth man was not in need of
wheat. Now this is the great function
of money. II carries the value of a great
bulk Of wheat in a very small compass,
and all that this great bulk Of wheat is
worth for the purposes OF exchange can
be conveniently carried in the pocket
We admit that If the world were sud
denly deprived OF its steam transporta-
ton and its electric communication, its
present state OF expanded business
would find the gold money that II has
contemptibly insignificant for effecting
the exchanges that money would then
be required for. But with steam trans
portation and electric communication,
we effect exchanges OF commodities di-
rect now. the exchanges going through
the forms of sales.
The transaction assumes this form A
farmer in Mecklenburg county has ten
thousand pounds Of tobacco to dispose Of.
He sends 1t TO his commission merchant
In Richmond. who sells it for $1,000, the
buyer giving the commission merchant a
check on one of Richmond's banks In
payment. The commission merchant de-
posts this check to his own credit, and
all that has been done is TO transfer a
credit on the books Of the bank for 81 900
from the purchaser of the tobacco to the
commission merchant. The commission
merchant then sends the farmer a check
for $1,000, and the same credit is trans
ferred 10 The farmer The farmer then