The Caldwell tribune. [volume] (Caldwell, Idaho Territory [Idaho]) 1883-1928, 1894-10-13
TO PUT HIM RIGHT.


In some respects the speech made by
J. ED. SMITH last Wednesday night was
very good. He stood squarely on fiat
money, endorsed. defended and advo-
Gated it from 1.-The word CO." to use his
own expression. But there is one thing
we desire to call particular attention to
at this time. 1t may have escaped Mr..
SMITHS notice or he may not be well
posted. In any event, he deserves to
be placed right. He laid much stress
on the fact that the first fifty millions
of dollars issued by government in
1901 always passed current at par,
and attributed it to the fact that
that issue did not contain the exception
clause. Mr.. SMITH contended that this
first issue of fifty millions Of greenbacks
was superior to any subsequent issue
because it was absolutely and unequiv-
ocally a fiat money. The conclusion
to be drawn is, the more fat you get
into money the more perfect it be-
comes. It is not now our purpose to
controvert Mr.. SMITHS doctrine. We
simply desire to enlighten him, and
those who heard him and know no bet
ter, with respect to few plain facts.
The first fifty millions of greenbacks
issued by government were further from
fiat money than subsequent issues, and,
as a matter of fact, no issue came with
in the definition of fiat money. We
want to make this plain so that Mr..
SMITH himself can understand it. Fiat
money is irredeemable in anything but
itself. 1t is basic money without in
trinsic value. 1t stands alone and un-
supported except by decree OF law.
When government commands that you
shall accept a worthless, irredeemable
piece of paper in final settlement Of
account, that is fiat money Now, with
respect to that fifty millions of green
backs. That issue always stood at par;
it had no exception clause; CONNER
mercially, those notes were the most
reputable ever issued by government;
they never suffered depreciation nor en-
dured disgrace. Whys because OF the
omission of the exception clause? Oh,
no; nothing of the kind; but because
they were demand notes-sight drafts,
if you please, on the treasury OF the
United States. There was not day
nor an hour from the moment that
those fifty millions went into circula-
ton but that they were instantly re-
deemable in gold or silver coin on pre-
sentation at the treasury. That is
what made them superior to any sub
sequent issue of greenbacks. Not one
of those notes was presented for re-
demption which was not redeemed on
the spot. What of subsequent issues T?
They were mere promissory notes, with
out date for redemption. The law
authorizing them was different kind
of law from the law under which the
first issue was made. The government
exhausted its ability to redeem on sight
with the first issue of fifty millions. In
all subsequent issues, government prom
ised to redeem, when? When it was
able. Thousands of people thought 1t
never would be able, so the greenbacks
issued on promise to redeem at the
option of government began to depre-
ciate and fluctuate. Every time there
was a battle and a Confederate victo-
~, greenbacks went down, because
people thought the Union would be dis
solved. Every time there was Union
victory greenbacks went up, because
the chances for the life of the govern
ment at Washington improved and the
prospects of ultimate redemption OF
government notes became better. The
first issue stood at par, because they
were redeemable at amy moment.
Hence, based on these facts, we must
conclude that the further paper prom
Use gets away from its metallic re-
deemer the less valuable it grows, and
if you cut it loose from redemption en-
tirely and eternally, it isn't worth
cuss.