The advocate., 1895-12-11

OF the United States notes and treasury notes,
amounting TO probably less than S8,0O0,000
might be supplied by such gold as would be
used on their retirement or by an increase In
tho circulation OF our national banks Though
the aggregate capital OF these now In existence
amounts to more than 900, their out
standing circulation based on bond security
amounts TO only about Sl9O,OO0OOO
I think they ought to be allowed to issue cir
CulatiOn equal to the par value OF the bonds
they deposit to secure IL, aud that the tax on
their circulation should be reduced to q OF per
cent, which would undoubtedly meet all the
expenses the government incurs on their Ro-
count. do not overlook the fact that the can
collation. Of the treasury notes issued under
the silver purchasing act Of 1890 would leave
the treasury In the actual ownership Of sum-
Cient silver, including seigniorage TO coin
nearly Sl78,0)0,000 In standard dollars It is
worthy Of consideration whether this might
not from time to time, be converted into dol
lars or fractional coin and slowly put into cir
Culation
In tho present stage OF our difnculty IL Is
not easy to understand how the amount OF our
revenue receipts directly Affects it The Inn
portant question Is not the quantity OF money
received In revenue payments, but the kind OF
money we maintain and our ability TO continue
In sound financial conditions We are cOnsid-
ering the government holding Of gold as re-
lated to the soundness Of our money and as az
fecting our national credit and monetary
strength. II our gold reserve had never been
impaired; II no bonds had been issued to re-
plenish; II there had been no fear and
timidity concerning our ability TO continue
gold payment; II any part OF our
revenues were now paid In gold;
and II we could look to our gold receipts as
means Of maintaining a safe reserve, the
amount Of our revenues would be an infuen-
tial factor in the problem. But unfortunately
all the circumstances that might lend weight
to this consideration are entirely lacking. In
our present predioament no gold is received by
the government in payment Of revenue charges,
nor would there be II the revenues were in-
creased. The receipts Of the treasury when
not In silver certificates consist OF United
States notes and treasury notes, issued for sill
YER purchases. These forms OF money are only
useful to the government in paying It's cur
rent ordinary expenses and Its quantity
In government possession does not In the
least contribute toward giving US the kind OF
safe financial standing or condition which Is
built on gold alone II 1t Is said that these
notes II held by the government can be used
TO obtain gold for our reserve the answer Is
ury on demand upon United States notes, but
the proposition that the treasury can on de-
mand draw gold from the people upon them
would be regarded In these days with wonder
and amusement. And even II this could be
done, there is nothing to prevent those thus
par ting with their gold from regaining 1t by
the next day or the next hour by the presenta-
tion OF the notes theyreceiVedine exchange for It,
The secretary OF the treasury might use such
notes taken from q surplus revenue to buy
gold In the market OF course he could not do
this without paying premium. Private hold
ers Of gold, unlike the government, having no
parity to maintain, would not be restrained
from making the best bargain possible when
they furnished gold to the treasury; but the
moment the secretary Of the treasury bought
gold on any terms above par he would estab-
lish q general and universal premium upon IL,
thus breaking down the parity between gold
and silver which the government Is
pledged to maintain, and opening the
way to new and serious complications.
In the meantime the premium would not re-
main stationary and the absurd spectacle
might be presented Of an alien selling gold TO
the government, ana with United States notes
in his hands Immediately clamoring for its re-
turn and q resale at O higher premium. Il
may be claimed that q large revenue and re-
duced receipts might favorably affect the situ-
alton under discussion by affording an oppor-
tunity affecting these notes in the treasury
when received and thus preventing their pre-
sentation for gold.
Such retention OF the metal ought to be at
least measurably permanent, and this is pre-
cisely what is prohibited 80 far as United
States notes are concerned.
BY the law Of 1873 forbldding their future
retirement that statute In so many words
provides that these notes when received into
the treasury and belonging to the United
States shall be paid out again and kept In
circulation" 1t will moreover be readily seen
that the government could not refuse to pay
out United States notes and treasury notes In
current transactions when demanded and In
sist on paying out silver alone and still
maintain the parity between that metal and