The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1894-08-05
THE CAUSE OF DEPRESSION.

The effort to shift the disasters re-
sulting from the demonstration OF Sill
yer and the contraction of the currency
onto the Democratic party because OF
Mr.. Clevelands attitude on the Sher-
man purchase act, is both hypocrlucal
and criminal, because it only tends 10
obscure the question in the public mind,
and to postpone it's proper solution.
Mr.. Cleveland and the country are con-
fronted with a condition, not theory
and that condition is one that at pres
ent we are powerless to control unless
we consent to actual reputation of our
debts held in foreign countries
Foreign capitalists for years have re-
fused to invest IN American securities
except upon a gold basis, and their de-
mands have been so far acquiesced in
that enormous quantities of railroad,
municipal and corporation securities
have been taken by them. Owing to
the general shrinkage in the values Of
industrial products throughout the
world, the collapse of many securities,
the failure of the Earrings, and the
sinking of two hundred millions of Eu-
ropean capital in the Darien canal
scheme, capitalists have either lost
confidence in American securities, or
have been obliged to realize through
necessities of their own, and this has
resulted in large blocks of American
securities being sent here for liquida-
ton, and as this liquidation must be in
gold, there is no possible evasion of the
condition that confronts the American
public to pay in gold until their debts
are liquidated, or to go into voluntary
bankruptcy.
If this question were simply confined
to the government bonded debt, it would
be of little moment to the American
people. But few realize the gigantic
proportions Of the aggregate debt
which the American people owe to for
eign investors, and still fewer realize
the disasters that would ensue in case
the confidence of foreign holders were
to be finally unsettled by a policy on
the part of our government to depre-
ciate the currency. The result would
be that our railroad bonds our munich
pal bonds, our state bonds, and the
bonds of our industrial corporations
would be suddenly thrown upon the
market, and the properties represented
by them irretrievably ruined.
The injustice through which the prop
critics of the earth have come to be
planted on the single gold standard
has nothing to do with the condition,
however much it may inhere to the
abstract theory. That the bondholding
class is beginning to realize that its
insistance for gold basis is beginning
to react upon itself, owing to the world
wide depreciation in the values of COM
modities which are really the founda-
ton upon which the stability Of all
securities rests, is the most hopeful
sign in the way of full reinstatement
of silver. But to force a currency upon
a creditor that he did not agree TO ac-
cept in the contract would be only to
precipitate a crash equivalent to a total
Reputation of debts and contracts.
The fundamental misfortune with
this country is that it is so tremen-
uouSiy IN debt. mat IL mas got 50 ire
mendously in debt has been due the
policy of forcing production by the I'M
natural stimulus of protecting indus
tries" by subvention and bounty far in
advance of the needs of population, and
often in advance of any population.
Railroads have been built through I'M
populated wildernesses on foundation
of bonds and debt. Towns have sprung
up along their lines, as in night, with
the magic Of borrowed money, and the
unhealthy prosperity lasted till the sup
ply of borrowed money was exhausted.
Wheat lands have been opened till now
the production is sufficient for a popula-
Ltion of 100000 of people. Iron mills