The Portland daily press., 1895-05-04
COINS SCHOOL.
Errors in the Book cleverly Exposed

(From R. W. Knott's article in the Louis
vile PostD
Q.-Wbat effect has the gold standard up
op wages?
Alt has only the effect it has upon COM
merce-it gives stability 20 all values and
increased facilities for exchange. 1t is
worthy of note that the nations having gold
as their standard of value and using both
metal in their currency have the largest
commerce and the highest scale of wages.
Q.-When did Germany adopt the single
gold standard?
A.--After her war with France. The pay
mont of the indemnity by France gave Ger
many control of a large stock OF gold, and
her rulers determined to take advantage
of the opportunity to reform the currency
system of the empire. The various States
then b1 ought together as one nation had II
varities of gold money and 66 different
coins of silver having full legal tender val
ne. The silver constituted 65 per cent of
the circulation. The new system estab-
lished gold as the sole monetary system.
with silver limited to $3.50 per capita and
its legal tender value limited to $5.
Q.-What effect had this action of Ger
many on other nations?
A.-The Latin Union comprising the
five countries using the franc system
France. Belgium. Italy. Switzerland. and
Greece--fearing Germany's silver would
food their mints to the exclusion of gold,
in 1874. restricted. and in 1878 entirely sus-
pended the coinage of silver five francs.
Q.-When did the decline of silver become
marked?
Ain 1875 the price of bar silver in Lon
don was S1.30 per ounce. In 1888 it had fall
len to S094. In 1894 it had fallen to S0.631a
or in 20 years it had declined ope-half.
Q.-What effect had this decline in value
upon the worlds production of silver?
Alt has steadily increased. In 1873 the
world production of silver WAS 63,a67 900
ounces. In 1892 it was 152.06l $50 ounces.
In other words. while the value has de-
creased one half the production has in
creased two and one-balf.
Q.-What las been the effect upon the
worlds progress of the economic changes?
A.-Never before in any corresponding
reriod of time, according to David A. Wells.
'has labor been so productive; never has
the volume of trade and commerce been
greater; never has wealth been more rapid
ly accumulated; never has there been so
much abundance for distributing on SO fay-
orable terms 90 the masses; never, finally.
would an ounce of silver exchange tor SO
much of sugar. wheat. wool, iron. copper.
and coal.' as in the period from 1873 to 1890
Q.-Can any of the recent disturbances
be attributed 10 the suspension of the free
coinage of silver?
A.-The suspension of the free coinage
81 7 1 -
cedented and universal prosperity. The
more recent disturbances are traecable to
other causes.
Q.--Would tne free coinage of silver by
tho United States restore its market value!
Alt would not. Admitting. merely for
the sake of argument. that the decline has
been due to the closing of the mints 10 sill
YER BY many nations. free coinage by one
could not restore the former equilibrium.
Q.-Is there any natural. unchanged BILE
ratio between the value of gold and silver?
A.-No more than there is between corn
and wheat, cotton and wool. iron and steel,
or the democratic and repu blican vote.
Q.-Is there constitutional ratio between
the value of gold and silver?
A.-None: the constitution leaves the
matter to the control of congress.
Q.-Has congress ever changed the legal
ratio?
Ain 1898 congress adopted the ratio of
Is to /, but at that ratio few silver dollars
were coined. And in 1905 President Jetfer-
son, by an executive order. closed the mints
to the coinage of the silver dollar. In 1884
congress changed the ratio to 16 to with
the avowed purpose of securing gold cur
rency.
Q.-What was the effect of this slight over
valuation Of gUld?
Awe secured gold and lost our silver.
Q.-What would be the effect should We
now over-value silver 100 per cent?
Ave would get all of the silver we
could pay for and lose all our gold.
Q.-What rule did Mr.. jefferson lay down
for establishing ratio between gold and
silver?
AIR. Jefferson said: 'tJust principles
will lead us to regard legal propositions al
together: to inquire into the market price
of gold in the several countries with which
we shall principally be connected in COM
meroe and to take an average from them.
The proposition between the values of
gold and silver is mecantile problem al
together"
Q.-Does the free coinage of any metal
fix finally it's relation to any other metal or
commodity
A.-Tbe free coinage of a metal at given
ratio is simply the legal recognition of a
fact already existing. When the market
ratio changes it is the part of wisdom to
change the legal ratio. When the fuctua-
tion becomes rapid and frequent 1t is the
part of wisdom to abandon sthe metal that
has shown the least stability. The object
of all coinage is simply to furnish commerce
with the best possible instrumentalities of
exchange. When any OF these instruments
become impaired there is no more reason
for retaining them than there would be for
retaining the stage coach as means of
transportation or preferring the ship of
1892 to the steam vessel Of 1895.
Q.-Do we not destroy half the money of
the world by closing the mint to silver3
A.-The quantity of money in the world
is of less Importance than the quality.
Money that is unsuitable is nuisance; but,
as a matter of fact. the silver money today