The times. [volume] (Richmond, Va.) 1890-1903, 1895-11-30
SATURDAY, NOVEMBER 80. 1895.
A GREAT FRENCH WRITER on OUR
FINANCES.

FINANCES.
NJ. Paul Leroy Beaulieu, of France, Is
one OF the most eminent writers on
po]ltical economy now living. He has
contributed an article TO the December
number OF the Forum on 1.-THE Condi-
lions for American Commercial and FL
nancial Supremacy" which ought TO be
read by every citizen of the United
States. II would produce revolution
towarsd sound principle if 1t were.
lie takes up our Governments issue
of notes first, and finds the Government
excusable for issuing them as a war
measure England did il. substantial
~. in her wars with France at the be-
ginning of this century; France. in the
war with Germany. and Italy. Austria,
and Germany i'm their conflicts have
each found IL necessary TO resort to
paper money TO meet their &ilitary
expenditures. But he calls particular
attention TO the fact that England had
discarded the idea of 1919. and has ever
since stood solidly upon a gold basis.
that France, eight years after the end
ing of her war. had exiting uished her
temporary war circulation. while our war
circulation is still outstanding. thirty
years after the war closed. ''The fact
seems TO have been overlooked" he
says. that these greenbacks were a
temporary expedcnt. that ought not to
be long continued after peace was es-
tabished. But the American Govern
ment showed zeal most praiseworthy in
itself In reducing it's bonded debt but it
neglected TO redeem It's urgent floating
debt. which in like circumstances had
been effected by the English and French
Governments. The belief obtained that
the situation would he sufficiently i'm
proved and strengthened by the rosump-
ton of specie payments IN 1873 This.
In my judgment. was great and vital
error, the evil influence of which has
been and is yet seriously felt in the en-
tire monetary and financial situation OF
the United States" And all Americans
should ponder upon this suggestion. II
is absolutely true If we had addressed
ourselves to the task Of paying off and
oxtnguishing the war circulation. in
stead OF piling up a huge gold reserve to
maintain 1t at par. our finances would
have adjusted themselves. and we could
after that have paid off the bonded
debt as occasion and opportunity iusti-
fed.
Nj. Leroy-Beaulieu next directs atten-
ton TO the inelastcty Of this kind of
, government circulation. and SAYS: AN
immovable, rigid. fduciary currency is
an absurdity. In the calmest years. this
currency must vary according to seasons
and circumstance Thus. in 1893 the
circulation OF the Bank of France oscil-
lated between S65l OoO.0oO and Sis, 900 600. or
difference of $6LO00.000. In 1891 the
minimum circulation OF the bank was
So2S. 10000 and the maximum. 1924 0O0 600
This capacity 10 contract or expand can
hardly exist in system OF hduciaiy
currency distributed by the State" And
ne says further on: when the State
issues the hduciary currency. as in the
United States. ii has no real means OF
protecting its metallic reserve. 1t can
not raise the rate OF discount In order
TO check the outflow OF gold. for ii does
not discount commercial paper. 1t is
under obligations TO pay gold 10 all who
demand ii. without any power 10 resu-
late or reduce the demand 1t is abso-
lutely disarmed. Its sole resource Is
TO secure gold by loans abroad. But as
these loans have no effect upon the gen.
oral current of business their proceeds
are soon exhausted and they must be
renewed. This incapacity TO protect its
reserve is the chief reason why a State
is not fltted TO issue fiduciary money"
Our pitisble condition could not have
been better stated. in which our Treasury
Is constantly having all its gold drawn
out. leaving the Government a protested
trader. unless It sells it's bonds to re-
plenish the stock.
Taking up free coinage. NJ. Leroy Beau
lieu says:
THE hesitation shown by so rich a
country as the United States 10 adoD,
the single gold standard. and reduce
silver TO the rank OF subordinate or
subsidiary coin, is most surprising TO
Industries. the silver-mining industry of
the United States. according TO official
figures. is but trifiing affair Thirty
seven and a half million dollars at mar
ket value, and double that at coming
yalue-what are these sums compared To
the immense products OF every sort Of the
United States? Less. than one-half per
cent. OF the total product. II we take the
market value: less than per cent, even
" we take the coinage value. And to
give an artificial value TO such an insig-
nificant portion OF its immense pro-
duct. the United States would compro-
mise all the rest. That appears mani
testify unreasonable.
placed between Europe and Asia the
United States can aspire to take from
England. In the course OF the next cen
tury,the commercial and financial suprem-
acy heretofore enjoyed by that country.
For this triumph. II will not suffice TO
poasoau IN abundance coal, iron. cotton.
lnaoialGnn1 vesknan. and bold and sntsr.