Iron County register. [volume] (Ironton, Iron County, Mo.) 1867-1965, 1895-01-03
WY THE GOLD IS EXPORTED.

My THE GOLD Is EXPORTED.
Republican Legislation tho Cause OF the
Tremendous Outgo.
The Indianapolis Journal was boast
ing the other day of the large foreign
investments made in America after
the passage of the Mckinley bill, and
at the same time asserting that ex-
ports of gold at present are caused by
the Carlisle currency bill. The Cour-
ier-Journal took occasion to show that
these investments after the passage OF
the Mckinley bill were mythical. so
far as they were indicated by the gold
movement, as the net exports of gold
in the twelve months ended June 80,
1891, were the largest since 1864. The
journal admits the accuracy of the fig
ures submitted, but tries to wriggle
out in this way:
1.-THE ourier-Journal points out that during
the 1sc year which ended June 80. 1891, the
net eZn ,rt Of gold was SOS, 087. then the
largest .ince 1854 That is true, but why was
this la. 70 export of gold necessary in 1891: Be-
cause &c net exports Of merchandise amount
ed to bit $50 ,564 64l. That balance in our favor
was much over one-third OF the money
necess.i - to pay foreign freights and interests
on Anne lean securities held abroad. So the
gold went The Courier-Journal also calls at
tention to the fact that the net export Of gold
during the fiscal year ended June 3d. 1893, was
SS7. 50j463 True; but turn to the records OF
exports and imports of merchandise for that
year. and it appears that we bought $l8,7 ,276
more abroad than we sold. That Is. we had to
pay during the year not only the foreign
freightS and dividends on securities. but S18,-
Ta7.1-S of adverse trade balance. That shows
why the gold was needed.
There are a few otLer interesting facts in
connection with this matter The net export
OF gold during the fiscal year which ended
June 20, 1894 was S4,5:S,942. Why was the net
export so small? Because the net export OF
merchandise during the same period was $751;
$3.50
Now, it will be observed that this
is wholly irrelevant to the question
whether the passage of the Mckinley
bill induced foreigners to invest large
sums in American securities and to
ship gold to this country to pay for
them. The large net export of gold
that year shows that they did not do
it. The Journal admits this, but says
the balance of trade, though in our
favor, as the phrase is. was not so much
in our favor as it might have been.
Why was not the balance OF trade
more in our favor? Was not the Nc
Kinley bill passed to check importa-
tiSns? If it be said it was not yet in
full operation. we pass on to the fiscal
year 1888, when it was certainly get
ting in it's work, and the balance of
trade was what is called adverse. This
year we exported SS7, 500, 4sS in gold, the
largest amount ever exported in sim
gle year. This showed clearly enough
that the Mckinley bill was not bring
ing gold from Europe.
Now, so far as the trade balance is
concerned there is practically no dis
pute that it would be paid in gold if
there were no other causes operating.
But other causes are always operat-
ing. Hence, if we assume that an
adverse balance of trade will neces-
sarily cause an outflow, or a balance
in our favor an inflow, of gold, we
shall continually find statistics refut-
ing our theory. In the fiscal year 1894,
as above stated, We exported more than
we imported by some $685., 200, O00
This was an ideal year according to
the republican theory, as the balance
of trade was SO largely lin our favor. "
Imports were really checked, as the
republican platform of 1883 demanded.
Still everybody knows it was a bad
year for business. The simple reason
why we did not import more was be-
cause we could not afford it, our re-
sources having been crippled by the
Sherman act panic. By republican
logic we ought to have imported, net,
1921, OOO, 900 of gold, but. in fact, our
net exports were over four millions.
No doubt the difference was made
up by the return of our securities, and
this was caused by the fear that we
might not be able to maintain the gold
standard.
The fact remains that the large out
flow of gold was going on under the
Harrison administration. ALI the con-
ditions affecting the currency, with
the exception of the Sherman act,
which were operating under the Har-
rison administration, are still in force.
To pretend, therefore. that the outflow
of gold, which has been going on for
years, whether the balance of trade
was one way or the other. has been
caused by the new currency bill is to
disregard all the proba bilities and the
lessons of experience. Not dollar of
national bank currency, as it is now.
or as it would be under the pending
bill, would be available to settle in
ternational balances The new cur
rency bill might, and probably would,
Rorce the banks to furnish their share
of the gold for export, and to that ex-
tent relieve the treasury. For that
reason it is rather calculated to dimin-
ish than to increase the shipment of
gold, as it gives an additional reason
to expect that the gold standard can
be retained-Louisville Courier-J our
nal.