The Roanoke times. [volume] (Roanoke, Va.) 1890-1895, 1895-07-09

OF Dollars az Compared to the Number
Issued-If Money Were of Unlimited
Quantity. It Would Have No Value.
Political economy has been called
tho dismal science. The most dismal
} branch or 1t, If men are to endcayor to
lorco conclusions to fit some Dreoon-
ceived theory without reference to prin-
clples, IL that which relates to money.
The persistent determination to make
the whole science subordinate to the alb
snrditics Of the gold standard has oper-
ated like Westinghouse brake ON the
progress OF the civilized world.
But there is ono principle of monetary
science that, If held steadfastly in view,
will constitute an unerring guido
through what would otherwise be a path
OF incxtricable difficulty.
That principle is that the value of the
unit Of money in any country is deter
mined by the number Of units in cirru
latiou. III other words, the value of ey
cry dollar depends on tho number of
dollars out
The greater the number of dollars out,
other things boing equal, the less will
bo the value of each dollar; tho fewer
the number out, other things remaining
tho Same, tho greater tho value of each.
and this without any regard whatever
to the material Of which the dollars arc
composed This is tho key To the finnn
cinl situation in the United States
Mich more, it Is tho key to the financial
situation in every land Without this
key it IS i'll vain that the student Mt
tempts to unlock the door leading to tho
arcanum of monetary knowledge. I'm
like many Of the locks made by man,
the lock on that door is unpicknblc
The household of science is one that
thieves cannot break through and steal.
lie who would cutcr must first find tho
key. With this key III hand the most
secret rcccsscs may he explored with
confidence. Without it, the student tray
els In IL circle, returning after much Ia
Dor to tho point from which he started
upon his journey Like one in a maze.
when most confidently expecting to find
his way out he but sees himself coming
up against impossible barriers.
If money were unlimited III quantity,
1t would have no value whatever. Moth
ing has value thnt is unlimited III oman
tity. If instead of sand the ocean beach
wero strewn with gold dust, it would
have no value whatever as commodity
Yet If that gold dust were taken ND and
coined into pieces of money, the number
OF such pieces being limited, they would
nave valuc precisely as goldpicccs have
value today. And, ON the other hand, as
Adam Smith says, if gold should reach
certain degree of scarcity, the slightest
bit nf 1t might become RS valuable as Il
diamond
So absolutely clear aro the leading
writers that tho value of money unit is
III every case, other things being equal,
determined by the number Of units out
and does not depend on tho material of
which the money may DO composed that
they have not tho slightest hesitation i'm
asserting that the rule applies even to
uncovered paper money, So that the value
of every dollar of gold und silver in cir
culation is diminished or increased nc
cordlhg as the quantity Of paper money
Is Increased or diminished, and, recipro-
cally rs TO all Of these, the increase in
the number of dollars of either kind di
mlnlshing the value of each dollar of
the others. while the decrease in the
number of either increases the value of
each of the others, without the slightest
regard whatever to the material of which
either of tho dollars is composed.
II this be so, if the value of tho INIT
of money depends not on the material of
the dollars. but on their quantity, what
becomes Of the gold standard? If this be
so, innsInuch rs silver has been utilized
as money since the dawn Of creation.
why abandon it now, unless senators are
prepared TO abandon tho automatic sys-
tenn altogether? If we must by legisla-
ton compel n change in the value of
money, why legislate so that it can
change IN one direction only. and TINT
the direction which is always favorable
to the classes that lend money and live
idly ON their incomes, the direction most
injurious to society, most fatal TO indus
try, most narcotizing to energy?
The idea that the value of n treasury
note issued by government such as
otlrs Is not based on tho number issued,
but ON something behind the note, or
npon the credit of the government, de
forms the whole idea of money 1t is
chung to because people have been accus-
toned to look upon money as something
of intrinsic" value, and on that theory
they have been at n loss to account for
the fact that uncovered paper dollars,
when sufficiently restricted in number,
have precisely the same purchasing
power ms gold money, quantity for guam
tity There is no question of credit
aboutit Norman takes piece of money
of any kind, whether gold or silver or
paper, as piece of credit. If it is not
legal tender, it is not. in the true and
full sense, money at all if n full legal