The Austin weekly statesman. (Austin, Tex.) 1883-1898, 1895-05-09
MORE OF MORTON'S VIEWS.
THE SECRETARY OF AGRICUL-
TURE REPLIES TO A
CRITICISM.
THE HISTORY OF SILVER COIN
AGE REVIEWED.
Plenty of Silver Lying Idle in the Treas
ury That Can't be Gotten Rid of
Because There is No Demand
for 1t.

that gentleman criticising some state
ments in the interiew with the secretary
of agriculture, printed couple of weeks
is as follows:
From your letter of April %, 1895,
it appears that you and perfectly agree
in the fundamental point, namely, that
demand and supply regulate the value
whatsoever, at all time, and in all places
At what points do we begin to separate
from each other and then come to con-
illusions so utterly diverse? These points
are only two, the first. historical, and
the second logical.
"First-You assume certain PROPOSE
tons to be true of silver which are not
historically true at all, but quite the re-
verse Of true. You say, for instance,
Until 1873 the chief use of silver was
for coinage. 1t had other uses, but the
demand for it for coinage purposes was
steady and constant
'On this point you have been monstrous-
ly misinformed. The first Federal coins
of silver were minted in 1874 and gold
in 1795. Their ratio was recommended
by Secretary Alexander Hamilton and,
as fixed by an act of congress, was 10
metals in equilibrium in the coinage.
But they would not even come into equi-
librium in that ratio, still less would they
stay there. Only 321 silver dollar pieces
we're coined at the American mint in the
entire year 1905 because the silver was
worth more out of the coinage than in it
and worth more for export than for
domestic money. What was the matter
with those silver dollars? Nothing only
they were too valuable. May l, 1906,
there came an order from President
Jefferson to the director of the mint at
Philadelphia: All the silver to be coined
at the mint shall be of small denomina-
tons so that the value of the largest
pieces shall not exceed half dollar The
reason given by the president for this
order was that considerable purchases
have been made of dollars coined at the
mint for the purpose of exporting them,
and it is probable that further purchases
and expectations will be made
The coinage of silver dollars thus au-
thoritatively suspended at the American
mint was not resumed there for 80 years.
In these few facts, which are of unnques-
tionable authority, one can behold the
beautiesand advantages of double stand
ard of the unlimited coinage of both
metals" in an enacted and constant ratio
with each other; of two yard sticks of
different lengths to measure cloths by in
the same market. By the law of 1884
the ratio was substantially put at 16 to
4. But this was going too far in the
opposite direction. Gold was not worth
16 in silver in the markets of Europe.
Consequently the international current of
the metals was now for a time reversed,
silver passing in preference abroad to Ii
quidate the balance of the trade in gold
coming in small quantities to the United
States, where it was more than 3 per
cent dearer in silver than in Europe. In
1853 the immense disadvantage of double
standard became so plain to all thinking
people that congress wisely determined to
abandon the utterly futile attempt to Sc
cure the parity" of the two metals and
to make gold the legal tender for debts
except for sums of So and under.
I'm the second place, Mr.. Cherry, as an
instance off an historical assumption,
contrary to facts and natural inference,
allow me respectfully to call your atten-
ton to the use, in common with money
of the bi-metallists, so-called, of the date
of 1873 as the time of the 'demonetiza-
ton of silver Unless l am mistaken,
the silver dollar is not mentioned at all,
one way or the other, in the act of
1878. All the decentralization of silver,
as l understand it, that ever came about
in this country happened in the law of
1853, after open and full discussion and
gress introduced the subsidiary silver
coinage of which a nominal dollars worth
weighed 6.97 per cent less than the sill
yer dollar and also took away the legal
tender quality of all silver in payment
of debts of over So in amount.
"Second-You employ over and over
again in your letter the two most common
logical fallacies that enter into that
species of argument everywhere, namely,
nnttinu info tho nlnnn of pfFpct and
assuming that because one thing hap
pened after another in point of limit it
was for that other. Let us look can
didly together at the two or three in
stances of this, taken almost at ran
dom. You ask what creates demand, and
the answer is use. | ask in turn, what
creates use, and answer, demand
"Why is it there is so little use of silver
dollars in this country today, while there
are millions of them lying idle? l answer
confidently, because there is no demand
for them. Have yOn not innOcenty but
badly mixed up cause and effect in this
case? Demand in the commercial sense
is the desire for something on the part OF
one man coupled with his willingness tC
pay something for it. Use of that thing
no matter what it is only follows the
demand for it. You have helplessly pu
the cart before the horse. What is the
sense in clamoring still for unlimited
coinage when the treasury cannot get rio
by hook of crook of 1.-THE of those already
coined and lying useless in heaps? They
are we'll minted, of just weight, nine
tenths fine, are legal tender for al debts
and bear the legend, in God We Trust. ,
What ails them? | answer, and so mus
Won on reflection, there is no demand fol
them and therefore no use. What more
can the law do for them? 1t may be my
dear sir, that in every study of fnanct
YOU have overlooked in whole or part the
momentous fact that all but mere trac
ton of the worlds commerce is medlateS
by Instruments of credit and not by metal
lie money at all, whether of gold or OF
silver. and that by far the most essentlia
service of money in this age of the worlC
is to furnish a steady measure. :,
'NIr. Eckels, the present comPtroile
of the treasury, has made it probable b!
careful inquiry instituted through ms I i
partment. that about 80 per cent OF IN
retail business of this country is achieve
by means of checks drawn on local BANK
and cleared by the banks with, very llttI
use of coin. The relative employment o
these instruments of credit is constant
increasing through the multiplication .
banks and otherwise, and of course aus,