The herald., 1895-01-14

Gravity OF the Financial situation.
To THE EDITOR OF THE HERALD The present
monetary situation in this country is yer; un-
satisfactory. The solvency OF the national
treasury is mentced by a mountain of de-
mand obligations, which, in panic, it could
not meet. The loyal attempt OF the admins.
traton to remove that menace has just failed
failed perhaps, because the proposed remedy
was not adequate, or the test that could have
been devised. But the situation still remains
serious and should be treated seriously and
not with iippancy
If the proposed legislation is not satisfactory,
why does not the opposition, both inside and
outside the Democratic party propose some
| thing better? There is crying need in the
present emergency for constructive statesman
ship, both from Republicans and Democrats
ii all parties would sink mere partisanship
in this matter it would seem as though they
could agree on some remedial legislation that
would rescue our national lreasury from its
present perlsi although the vide differing,
often antagonistc views held by congressman,
as revealed in late discussions are not eassur-
ing it must be confessed. Nevertheless, there
certainly ought to DO no d fliculty in agreeing
on certain fundamental principles which
would seem to be self-evident without argu-
| ment:
l. That our monetary system, like our postal
system, should be exclusively under national
| instead OF under state control. The ranfica-
lions OF both extend to the remotest corners.
not only of this republic, but OF the world.
| What sort of chaos would reign if the 40 odd
states of this union had each an independent
| postal system? Or ii each state had an indie
pendent coinage and banking system? The
supposition in either case is preposterous.
Mail matter, like money, travels from one end
| nv n "a Ot IN
countries, and the only way in which uniform
ity and the highest efficiency is attainabie is
to have both under national control.
| 2, Our constitution, recognizing that silver
and gold have been for ages he money of
| the world, gives to congress the power to coin
these metals and regulate their relative or
ratiovalue. That is, it recognizes further, and
with the highest wisdom, that these metals
have an automatic market value their own,
| which is not, or should not be, materially
changed by any mere jugge of passing
through the mint; ana il empowers congress
to have them carved into convenient pieces of
| definite weight and fneness whereby the
| people. and the government itself, may use
| them to measure other values, by the identi-
ca value which these metals had before they
were coined; the functions OF the mint being
| strictly limited TO the gauging and certifca-
| ton OF the weight and fneness of the pieces
struck off and of course, without changing
heir values in any respect by the operation.
| Consequently, in order that we may have uni
formity of coinage throughout the country
the minis should be, as they are, in fact, IN.
der the sole control OF the nation, and not of
| the several states.
| g. As mankind prefer, as a rule, to use paper
representatives of money in place of the
money itself, every system must provide for a
paper currency issue, which must be in strict
harmony with, and strictly supplementary to,
| the coinage system. And here again we see
that the only way in which this or any other
country can have q perfectly homogeneous
monetary system is that the entire system in
all its parts shall be controlled or effectively
regulated by the nation, and not by plurality
ofeoRflicting authorities. But this necessary
uniformity OF a currency system can be secured
| by supervision without the nation going into
| the banking business on its own account. AS
we see eXempliied in the practice of many en-
| lightened governments, all that is necessary is
to provide by legislation for the safe issue of
bank notes and private enterprise will do the
| rest No government in the world makes the
| value of money: all any government can
do is to certify to the weight anu quality
OF the material used as money which had the
same value before certifcaton as after. 1t
merely regulates the minting of metal with
out chang.n its value So no COVER nment
need go into the banking business on its own
account But it is absolutely necessary for it
to carefully regulate the issue of circulating
bills by private parties or by banks, for public
convenience, both in order to preserve uni
formity IN the money system as well as to pre-
vent the public from being defrauded
4. The greentacks and so-called sherman
notes, aggregating $500, 100, 600. are part of
our national debt. Unlike our bonds, they
draw no interes', but the whole body of them
are due on demand; that is, today and every
day, until finally paid off; whereas the bonds
are payable at some future day. when they will
be promptly paid or refunded
Because in good times, as we have SEEN this
reat volume OF demand paper can be kept
atoat, and considerable amount of interest
is thereby saved annually; many, perhaps a
large majority of the American people, think
it ought to be made p rmanent part of our
currency; and this belief has crystalized into
law, which requires greenbacks, when received
at the treasury, to be paid out again. Now
one OF the penalties OF issuing paper payable
on demand, is, that It must be paid whenever
| presented. If this great volume OF demand
| paper were distributed among several thou
sand bankers, the burden of being always pre-
pared for its redemption would devolve on
them, and the treasury would b. relieved
therefrom. And the bankers would not be
handle pped by the compulsory requirement
to reissue their demand paper as fast as they
redeemed it, as the treasury is now compelled
| by law to DO.
| Ii this 100000 900 had been funded at any
time prior to 1894, in . or "a per cent, $50 or
1040 year bonds, then the legitimate func-
lions OF our national treasury could have been
| performed free from the complex and very
grave embarrassment which now beset it,
AS to saving interest, behold the situation:
hntra