The Indiana State sentinel. [volume] (Indianapolis) 1868-1895, 1894-12-12
EFFECTS OF INFLATION.
The St Louis Globe-Democrat utters
the following:

EFFECTS OF INITIATION.
The St. Louis Globe-Democrat utters
the following:
the retirement of the greenbac<s, but it
| VIII be hard TO get the average western
| or southern democrat to see ii or TO con-
sent to it. Still the government Is right.
! deemed and Cancelled the better for the
] country.
Why greenbacks more than any of the
other forms of national paper money?
Any of them can be used in drawing gold
| from the national treasury, and that is
| what IT Is desirable to prevent at the
present time. But how is this money to
be redeemed and canceled?" We think
there are very few western or southern
democrats who would object to that. 1t
can be redeemed only in gold, and the
government would not have enough gold
to do that if it had in the treasury every
dollar in gold in the country. The reason
is that the governments paper currency is
nearly twice in amount all the gold in
the country. And so long as any of it is
IN circulation 1t can be presented at the
treasury for redemption in gold.
The simple truth is that the embarrass-
ment of the government results primarily
from imitation of it's credit money. For
quarter Of century, under the pre-
tense of a desire to secure ''honest
money" the republican party has been
Initiating the paper currency at an enOr-
nous rate. 1t began with the demonetiza-
ton of silver, for decentralization of stand
ard money and imitation of credit money
are equivalents. If a country has a
metallic stock Of 500, OOO,O 900 and paper
issue of sSOO,OOO,OOO the effect is the same
If you destroy half of the metallic stock
as If you double the paper issue. That is
to say $1OO,OOO,OOO gold is just as good
security for $500, 100000 paper as s50,OOOO 900
gold is for $500, 900, 900 silver. But more
than that, the silver itself is made credit
money and added to the burden which the
nation has to carry. In addition to this
is the increased amount Of paper currency
for which the government is directly re-
sponslble. The total amount of this re-
publican imitation is approximately as fol-
lows:
Increase of paper currency 500 600 900
Increase by characterization. 1000 100000
DemOnetiZed silver. ........... 600O0JOO0
Total imitation. g. 200 900 900
We are now dealing with a condition,
and this condition has been brought about
by the republican party under the leader
ship Of that jumping jack fnancier, John
Sherman. There is outstanding $1,000. OOO,-
600 of paper money to be redeemed in
gold, and gold is worth twice as much as
it in 1873 In countries where the
principles Of government do not change,
as in our own. there has been a steady
preparation for the extreme pressure for
gold that is an inevitable result Of gold
monometallism. In this country the last
administration thought 1t could achieve
cumulated surplus and reducing the gold
reserve. Hence the government Is now
obliged to build up its reserves in any
possible way or abandon specie payments.
gle OF gold recommendation.
The first quarter Of a century of de-
monetization of silver has been one OF
tremendous and frequent panics. No gold
standard country has escaped them. The
strongest gold-standard countries have
been terribly shaken by them. No silver
standard country has been affected by
them, but all silver standard countries. ex-
cept Argentina, held to the silver stand
ard from the first. and so moved gradually
from their relation to the old standard. A
sudden change now to a standard of so
per cent. less value would certainly
produce widespread ruin as it did in Ar
gentina
Our only safe course is to stick to our
present standard and fight it out To do
that we should accumulate gold rapid
ly as possible and make our paper cur
rency as safe as possible. 1t ought to be
more elastic but it would be suicidal to pur-
chase elasticity by any weakening of the
quality of our paper money. II it can be
permanently retired, well and good. But
it is very difficult to see how it can be
retired permanently without actual re-
demption. The government ought not
have assumed the functions Of a bank of
issue-at least It ought not have issued so
much paper money 1t has issued. But
1t has done so, and If 1t desires to quit 1t |
now has to do what every other bank OF
issue has to do when it goes out of the
business 1t certainly Neannot permanently |
rid itself Of responsibility for its paper
issues by any system OF permitting indi-
viduals or corporations to issue paper
money.