The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1895-12-04

money are only useful to the govern
ment in paying its current ordinary
| expenses, and its quantity in governs
ment possession does not in the least
contribute toward giving US that kind
of safe financial standing or condition
/ which is built on gold alone.
If it is said that these notes, if held
| bv the government, can be used to OBJ
| tain gold for our reserve, the answer is
| easy. The people draw gold from the
| Treasury on demand upon United
! States notes and Treasury notes, but
the proposition that the Treasury can
| on demand draw gold from the people
upon them would be regarded i'm these
| days with wonder and amusement and
/ even il this could be- done, there is
| nothing to prevent those thus parting
| with their gold from regaining it the
| next day or the next hour by the pre-
| sentation the notes they received in
| exchange for it. The Secretary of the
| Treasury might use such notes taken
| from a surplus revenue to buy gold in
| the market Of course ne could not
! do this without paying a premium.
! Private holders of gold, unlike the
| government, having no parity to main
| tain, would not be restrained from
/ making the best bargain possible when
| they furnish gold to the Treasury; but
| the moment the Secretary of the Treas
| ury bought gold on any terms above
| par he would establish a general and
| universal premium upon it, thus
| breaking down the parity between
| gold and silver which the government
| is pledged to maintain, and opening
| the way to new serious complications.
| In the meantime the premium would
not remain stationary, and the absurd
| spectacle might be presented Of a deal
| en- selling gold to the government, and
! with United States notes or Treasury
| notes in his hand Immediately clamor-
| ing for its return and resale at a
| higher premium.
! MUST BE REDEEMED IN GOLD.
| 1T may be claimed that a large rev
enue and abundant receipts might ia
Yorably affect the situation under dis
| cussion by affording an opportunity
| of retaining these notes in the Treasu-
| ny when received, and thus preventing
| their presentation for gold Such re-
| tention to be useful ought to be at
least measurably permanent; and this
| is precisely what is prohibited so far
| as United States notes are concerned,
| by the law of 1873 forbidding their
| further retirement. The 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 circula-
ton
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 insist on paying
out silver alone and still maintain the
| parity between that metal and the
currency gold, besides the accumula-
| ton in the Treasury of currency of any
kind eXacted from the people through
| taxation is justly regarded as an evil,
and it can not proceed far without Wig
orous protest against an unjustifiable
retention of money from the business
| of the country and denunciation of a
| scheme of taxation which proves it
| self to be unjust when it takes from
| the earnings and income of the citizen
money so much in excess of the needs
| of government support that large
sums can be gathered and kept in the
| Treasury. Such n condition has here
| tofore in times of surplus revenue led
|
| to the people by the purchase of its I'M
| matured bonds at q large premium
| and bv large increase of its deposits
| in national banks, and we easily re-
member that the abuse of Treasury ac-
| cumnlation has furnished most per-
| suasive argument in favor of legisla-
| ton radically reducing our tariff tax
| alton. Perhaps it is supposed that suf
| ficient revenue receirts would in sem
| timental way improve the situation,
| by inspiring confidence in our solven-
/ cy and allalying the fear of pecuniary
exhaustion And yet through all our
| struggles to maintain our gold reserve
| there never has been any apprehen-
sion as to our ready ability to pay our
| way with such money as we had; and
| the question whether or not our cur
| rent receipts met our current expenses
! has not entered into the estimate of
| our solyency. Of course the general
! state of funds, exclusive of gold, was
| entirely immateriaI to the foreign
| creditor and investor. His debt could
only be paid in gold and his only con-
| Germ was our ability to keep on hand
| that kind of money.
| On July !, 1892, more than year and
1
| issued TO replenish the gold reserve
there was a net balance in the treasury
| exclusive of such reserve of less than
/ $13,000,000; but the gold reserve
amounted to more than $lit.000,000,
which was the quoting feature of the
situation. 1t was when the stock of
gold began rapidly to fail that fright
superyened and our securities held
abroad were returned for sale, and
debts owed abroad were pressed for
| payment. in the meantime extensive
shipments Of gold and other unfavor-
| able indications caused restlesSness
| and fright among our people at home.
| The reason for the general state of our
/ funds, exclusive of gold. became also
immaterial to them and they, too,
drew gold from the treasury for hoard
| ing against all contingencies. This is
plainly shown by the large increase in
the proportion of gold withdrawn
which was retained by our own people
| as time and threatening incidents pro-
crossed. During the fiscal year ending
| Hume 10th 1894 nearly $50 900 900 in