The Mankato free press. [volume] (Mankato, Blue Earth County, Minn.) 1879-1924, 1895-12-06
ABOUT OUR FINANCES.
Present Situation Demands Prompt and
Wise Treatment.


Present Situation Demands Prompt and
Wise Treatment.
AS we turn from a review of our foreign
relations to the contemplation of our ma
tional financial situation, we are imme-
diately aware that we approach subject
of domestic concern more important than
any other that can engage our attention,
and one at present in such perplexing
and delicate predicament as to require
prompt and wise treatment.
The compulsory purchase and coinage of
silver by the government unchecked and
unregulated by business conditions and
needless of our currency needs, which for
more than ID years diluted our circu-
lating medium, undermined confidence
abroad in our financial ability, and at last
eliminated in distress and panic at home
has been stopped by the repeal of the laws
which forced this reckless scheme upon
the country. This, together with the
amended tariff bill, Notwithstanding their
extreme Importance and benefcent effects,
fall far short of curing the monetary evils
from which we suffer as a result of long
indulgence in ill-advised financial ex
pedients
Greenbacks Discussed.
notes and commonly known as green
backs was issued in large volume during
the late civil war intended originally to
meet the exigencies of that period A
large quantity of them however, were
kept on foot and mingled with the cur
rency of the country so that at the close
of the year 1874, they amounted to $751;
999, 073.
Immediately after that date and in jan
uary, 1875, law was passed providing
that on and after the 1st of January, 1879,
the United States notes then outstanding
should be redeemed in coin and in order
to provide and prepare fCi such redemp-
ton the secretary of the treasury was au-
thorized not only to use any surplus rev.
enues of the government but to issue
bonds of the United States, and dispose
of them for coin and to use the proceeds
for the purposes contemplated by the
statute.
In May, 1873, and before the date thus
appointed for the redemption and retire
ment of these notes, another statute was
passed forbidding their further cancella-
ton and retirement. Some of them had
however, been previously redeemed and
cancelled upon the issue of additional ma
tional bank circulation as permitted by
the law of 1875, so that the amount out
standing at the time of the passage of the
act forbidding their further retirement
was $346, 1851, 016.
Provisions of the Law of 1878.
The law of 1878 did not stop at distinct
prohibition, but contained, in addition,
the following express provision: "And
when any of said notes may be redeemed
or be received into the treasury under any
law from any source whatever and shall
belong to the United States, they shall not
be retired. cancelled or destroyed, but
they shall be reissued and paid out again
and kept in circulation"
The government was thus put in the
anomalous position of owing to the hold
ers of it's notes, debts payable in gold on
demand, which could neither be retired
by receiving such notes in discharging
obligations due the government nor cam
celled by actual payment in gold. 1t was
forced to redeem without redemption and
to pay without acquittance.
There had been issued and sold So, $780,
600 of the bonds authorized by the resump-
ton act of 1879, the proceeds of which,
together with other gold in the treasury,
created gold fund deemed sufficient to
meet the demands which might be made
upon it for the redemption of the out
standing United States notes. This fund,
together with such other gold as might be
from time to time in the treasury available
for the same purpose, has since been called
our gold reserve, and Sl00, 0O0, 900 has been
regarded as an adequate amount to ac-
complish it's object
Shrinkage of the Reserve.
The reserve had fallen in April, 1895, to
$97 oil. $50. 1t has from that time to the
present with very few and unimportant
movements, steadily decreased except as
it has been temporarily replenished by the
sale of bonds.
Among the causes for this constant and
uniform shrinkage in this fund may be
mentioned the great falling off of exports
under the operation of the tariff law un-
til recently in force, which crippled our
exchange of commodities with foreign
nations and necessity, to some extent. the
payment of our balances in gold; the un-
natural infusion of silver into our cur
rency. and the increasing agitation for its
| free and unlimited coinage, which have
created apprehension as to our disposition
| or ability to continue gold payments; the
consequent boarding of gold at home and
| the stoppage of investments of foreign
capital, as well as the return of our Sc
| curities already sold abroad. and the
] nigh rate Of foreign exchange, which In