Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1895-12-04
LARGER REVENUE NOT A REMEDY.
The President Thinks 1t Would Not Settle
the Dificulty.

Perhaps it is supposed that sufficient revenue
receipts would in a sentimental way improve
tne sl1oatlon ny inspiring confidence IN our
hausticn. And Yet, through all our struggle to
maintain our gold reserve, there never has been
any apprehension as to our ready ability tn pay
our way with such money as We had; and the
questt whether or not our current receipts
met our current expenses has not entered into
the estimate of our solvency. OF course the
general state of our funds, exclusive of gold
was entirely immaterial to the foreign cred
itor and investor. His debt could only be paid
in gold, and his only concern was our ability
to keep on hand that kind of money.
On July !, ls:s. more than a year and a half
before the first bonds were issued to replenish
the gold reserve, there was a net balance in
tue treasury. exclusive of such reserve, of less
than Sl39O,UD; but the gold reserve amounted
ing feature of the situation. 1t was when the
stock of gold began rapidly to fall that fright
were returned for sale and debts owed abroad
were pressed for payment. In the meantime
extensive shipments of gold and other unfavor-
aoie indications caused restlessness and
fright among our people at home. Thereupon
the general state of our funds exclusive of gold,
became also immaterial to them and they too
drew gold from the treasury for boarding
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OF gold withdrawn which was retained by our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
progressed. During the fiscal year ending June
ID, 1894, nearly SS5.OO0Wpo in gold was with
drawn from the treasury and about S11.0OO.OO0
was sent abroad, while during the fiscal year
ending June 81, 1888, over Sl17UUOyO was
drawn out. of which only about S66,OOO,01
drawais 10 be accounted for by domestic hoard
ing.
Change in Our Finances Needed.
Inasmuch as the withdrawal of our gold has
resulted largely from fright, there is nothing
apparent IL at will prevent its continuance or
recurrence with its natural Consequences ex-
cept such a change in our financial methods as
viii reassure the frightened and make the de-
sire for gold less intense. 1t is not clear how
an increase in revenue, unless it be in gold, can
satisfy those whose only anxiety is to gain gold
from the government 5 store. 1t cannot there
fore. be safe to rely upon increased revenues as
a cure for ouI present troubles. 1t is possible
that the suggestion of increased revenue as 4
remedy for the difficulties are considering
may have originated in an intmation or distinct
allegation that the bonds which have been
issued Ostensibly to replenish our gold re-
serve were really issued to supply insufficient
revenue. Nothing can be further from the
truth. Bonds We're issued to obtain gold for
the maintenance of our national credit. As
has been shown, the gold thus obtained has
been drawn again from the treasury upon
United States notes and treasury notos. This
operation would have been promptly prevent
ed, II possible; but those notes having thus
been passed to the treasury. they became the
money of the government, like any other ordi
nary funds. and there was nothing to do but
to use them III paying government expenses
when needed.
Government Not in Ne ed of Money,
AT no time when bonds have been issued has
there been any considera ton of the question of
paying the expenses OF government with their
proceeds There was no necessity to consider
that question. At the time of each bond issue
We had safe surplus in the treasury for ordi-
nary operations, exclusive of the gold in our
reserve. In February, 1884,, when the first
issue of bonds was made, such surplus
amounted to over Sls.O0O,WD: in November,
wnen the second issue was made il amounted
to more than 81, GU,W J, and IN February, 1885
when bonds for the third time were Issued
such surplus amounted to more than
Sl00Uu,W. 1t now amounts to Sos
O,a,i.D.3. Besides all this, the secretary OF
the treasury hal no authority whatever to issue
bonds TO increase the ordinary revenues or
pay current expenses. i cannot but think
there has been some confusion of ideas regard
ing the effects of the issue of bonds and tie re-
SUITS of the withdrawal of gold. IL was the
latter process-and not the former-that by
notes and treasury notes for gold increased by
their amount the money which was in the first
instance subject TO ordinary government ex-
pendIture.
Although the law compelling an increased
purchase of silver by tn. government was
passed on the oath day OF july 1850 within rawals
of gold from the treasury upon the not q
gwen IN payment such purchases did not
| oeg.n until October, 1881. Immediately follow
ing that date tho Withdrawals upon both these
notes and United States notes Increased very
largely and have continued to such an extent
that since the passage of that law there has
been more than thirteen times much gold
taken out or the treasury upon United States
notes and treasury notes issued for silver pUr
ehases as was tins withdrawn during the
eleven ana halt years Immediately prior
thereto and after the first day of January,
la m -VNtnr