Birmingham age-herald., 1895-05-19
NATURE OF MONEY.


 The "obfustications' in Coins" mind about redemption money" and about the general relations of money to the indus trial system are so widespread in the pages of his book that it may be well to take up this group of ideas. Being ut terly new and unknown to any students.
 of money from Coperncus and his De
 Monetae Cudendae Ratione" down to the
 present time, and depending merely on
 "Con's' genial fancy, it may be absurd to take them seriously. But "Coin" takes himself seriously. and many people also
 wish to know wherein Coin" is in error. Therefore, an idea of fundamentals may
 be helpful.
 II is convenient for the human mind to distinguish between different ideas. Pro- dGction. for instance is one thing and eX- change of goods already in existence is another thing. It is one thing for. a fac tory to get steel employ men and manu-
 fracture penknives; it is quite another thing for boys to swap knives after the factory has brought knives into existence
 It goes without saying that swapping knives does not increase the number of knives in existence. The boys may keep at it every day in the year, and the knives may have changed hands 300 times, but at the end of the year there are no more knives in existence by the exchanging than there were at the beginning of the year.
 So it is with horses; trading horses does not increase the horses to be traded. You cannot trade horses that do not eX- ist So, also, it is with wheat and dry goods; exchanging wheat for dry goods does not affect the quantity of wheat or dry goods in existence. To increase wheat one must go through all the ante cedent processes of production. such as blowing, seeding. waiting harvesting and the like One cannot exchange wheat that does not exist. The exchange idea. therefore. is one subsequent to produc- ton, and dependent on it. It is the sim plest commonplace, then, to understand that neither knives nor wheat are created
 by swapping them in exchange for any thing else.
 When a boy exchanges his knife for money and then exchanges that money for another knife, the operation is exactly the same, in the end, as if the two knives were exchanged directly against each other One knife is exchanged for the other through the medium of a third ar | ticle. That is, money here performs the | function of medium of exchange. And | the use of money in exchanging knives | has nothing to do with the creating of knives. That was done back in the fac | tory before any exchange could have
 taken place. It may seem childish to in
 sist upon so elementary matter, but we | must start at the beginning. We must learn the sounds of the letters before we | can spell and read.
 It would not be necessary to insist upon | this easy lesson if it were not constantly
 urged that somehow an increase of | money is a decided advantage. The
 whole subject cannot be covered in a | word butlwe can understand part at q | time. But what is fundamental and sim | pie is that increasing the medium of ex-
 change does not make greater produc- | tion of goods. You cannot increase goods
 simply by exchanging them; that is clear | This may be still further illuStrated | If the number of railways between Chi | cago and St. Louis were increased it Is self-evident that thereby the number of l bushels of corn and wheat to be carried on the railways would not be increased | An increase in the means of transporta- l ton does not increase the quantity Of 1 goods to be transported. To get more wheat and corn a man must go to blow l ing and cultivating land. It would be | idiotic to try to grow wheat and corn by l building trestles, laynig tracks and erect ing locomotives.
 The case is precisely the same with | money and goods. Money is only the l machinery by which goods are exchanged | against one anotheE It is only means l to an end. It bears the same resem- | blance to goods that a railway or l bridge does. Increasing the amount of money does not increase the quantity of l goods anyone owns. Money, no matter | how valuable 1t may be, is not wanted | for it's own sake, but for what it will buy. l We do not eat nor drink, nor keep the money itself. It is the very thing that | earns nothing so long as we hold it. It | is a means to an end, or like bridge,
 a means of getting goods from one shore
 of river to another To suppose that increasing the quantity of money would
 increase the goods to be exchanged is as absurd as to confuse the corn and pork which pass over the bridge with the
 bridge itself. The idea that coining more | silver or issuing more paper money
 would make the country richer is the
 same as claiming that the more bridges
 we build the more corn and pork we shall have. To try to persuade farmer that
 the more money there is in circulation