Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1895-05-21


use OF silver as money by direct legal en-
actment or by undertaking II relatively 10
gold In the coinage laws would certainly
result In practical gold monometaliism,
and. on the other hand, II Is equally
clear that any policy which would dis
continue the use OF gold az money py
legal enactment or by undertaking. that
metal relatively to silver In the coinage
laws. would result IN practical silVer
monometallism. M
Free and unlimited coinage at the ratio
Of 10 TO / would at once establish silver
monometallism pure and simple, Tor, as
already shown. the coins OF the over
valued metal will ultimately drive the
coins OF the other out OF circulation and
out OF the country. even when the legal
ratio varies but small fraction from the
commercial ratio, but the expulsion OF
the undervalued coin from circulation
would be instantaneous when lis value
IL really double the value OF the other
How long do you suppose the sbs9,VV1'vV
Of gold in this country would remain here
and be used as money under such poll
cy? The banking and other great finan-
cial Institutions, which own and hold IN
their reserves much the greater part or
this gold. would at once sell II at large
premium for sllveY--about two dollars for
one dolar-or they would exchange II for
silver bullion In the market at the ratio
OF about 80 pounds OF silver for each
pound OF gold. have the 80 pounds OF sill
yer coined into dollars at the expense OF
the people, and with this cheap money
pay the demands Of their depositors and
other creditors. The masses Of the people
cannot do this. for they have no gold nor
have they any silver bullion to be coined
at the expense OF the government
THE DEBTORS VIEW.
But 1t is said that although the masses
OF the people have no bullion, many OF
them are In debt and that the free coin
age OF silver would increase prices and
give them more money, thus enabling them
TO discharge their obligations more easily.
The merit OF this argument will be Judged
by each individual according to the view
which he may take OF the nature Of
his obligations to the people who have
loaned money or sold property to him.
II man who has borrowed a thousand
dollars in gold, or its equivalent, and has
promised TO pay it, or has purchased
thousand dollars worth of another mans
property and promised 20 pay for II In
the standard money recognized by law at
the date Of his contract, believes that IL
would be just and honest to discharge
his obligation In a new standard worth
only half as much as the money he bor-
rowed or the property he purchased. he
would appreciate and indorse this argu-
ment, and II would be useless TO discuss
the question with him. But IT, as / have
already endeavored TO show, the imme-
date effect of the adoption Of a free
coinage policy at the ratio Of 16 to 1
would be to contract the currency to the
extent OF about s625. 600 600, by the with
drawal OF that amount of gold from cir
culation and from use as the basis OF
notes and other forms Of credit prices
would not even nominally advance. On
the contrary, for the time being at least,
ahis contraction would greatly reduce
prices, because II would alarm the coun.
try. destroy credit. and undoubtedly pro-
duce the most serious financial disturbance
this country has ever witnessed
EFFECT OF FREE SILVER ON DE-
POSTS.
Every depositor i'm the savings and Other
banks. fearing that he would ultimately
be paid in deprecated silver, would i'm
mediately demand the return Of his
money, and this would compel the banks
to call at once for the payment of All
the notes and other securities they had
discounted for their customers. and the
contraction OF the currency would cause
an increased demand for currency at the
very time when il could not be obtained
ana thus the difficulty Of the situation
would be increased by both causes. The
banks would be compelled to either sus-
pehd payments themselves or drive their
customers who are generally business
men-tne men who give employment TO
labor In every COMMUNICATIVE bank
ruptcy at once
who would profit by this condition Of af
ImrsI Nobody except the holders of gold
and the owners of silver mines the boId-
ers of silver bullion, and the brokers ana
spectators In the stocks Of silver-mining
companies The people who owe debts and
are unable to pay them would be the
ones to suffer most, while the people who
owe no debts and have money on hand
would be the ones to profit most. Every
man In debt would be called upon TO nav
IL promptly when due; there would be no
more extensions Of old debts. or any new
credits given, because no man could fore
tell what the money would be worth at
any time in the future. In this crash tho
laborer would be thrown out of employ-
ment by the failure or suspension of his
employer. the farmer would receive less
real money for his products. property
would be sold at low rates under judicial
proceedings all over the country. credit
would be destroyed, and all Industrial and
commercial enterprises would stand still
awaiting the result of the new expert
ment with the monetary system. OF
natural resources, would ultimately re-
cover in some measure from even such a
disaster, but how long a time would be
required 10 DO so no man can predict.
CAPACITY OF THE MINIS.
All the minis of the United States II
devoted entirely to the coinage Of silver
dollars, could produce only about forty
million dollars per annum, and therefore.
with free coinage IL would require more
than fifteen years TO pat silver dollars in
the place Of the gold we now have and
give back 10 the country the same amount
OF metallic money now existing. But. In
the mean time we would have a depre-
ciated standard OF value with nomlnaiiy
higher prices-after the first collapse was
over-on account Of the reduced pur-
chasing power OF the dollar, and at the
same time we would have for a long time
fewer dollars to pay with. Common pru-
dence would dictate that. when any CON
siderable change Is TO be made in chr
monetary system, some provision should
be made In advance Of the actual change
for gradual transition from the old to
the new order of things; a transition pc
Rod should be provided for SO as TO
avoid, as far as possible, a sudden dis
turbance OF business and contraction Of
the currency; but the advocates Of free
coinage have no such purpose They pro-
pose TO make a sudden and revolutionary
change In the standard upon which all
existing contracts Of the people are based
and by which all values are measured,
and let the consequences take care OF
themselves.
EFFECT OF INCREASED PRICES.
But, suppose the change Is made, and
that the business affairs OF the country
have been finally adjusted TO the new
standard, what will be the effect on our
domestic trade? The prices Of all things
viii be nominally increased-that Is 10 say,
II will require greater number of dollars
10 purchase a given amount OF any COM
modify than IL required before. There APP
pears to be a singular delusion In the
minds of some upon this subject Many
good people appear 10 think that in some
mysterious manner, which no one has yet
attempted 10 explain, the government, by
legislation or otherwise, can increase the
prices of the things they have TO sell
without increasing the prices of the things
they have TO buy. III there il any fnan-
cial necTomancy by which this one-sided
increase OF prices can be accomplished,
our free-cOinage friends ought to explain
IT TO the people. The plain very-day,
common-sense view Of this subject is the
only correct one. If prices are increased
solely on account of an increase in the
volume Of circulation. or on account OF a
depreciation OF the currency, without any
change In the relation between the supply
and demand OF the commodities to be
exchanged .he increase in prices will |