The Scranton tribune. [volume] (Scranton, Pa.) 1891-1910, 1895-05-24
CARLISLE ON currency
concluded from Page IL


the passage of the act of 1884 For the
purpose of restoring gold to the circulation
congress, in 1884, changed the ratio from
10 to /, to 1G to |. and as this was an
over-valuation of gold in the coinage, sill
yer left the country, and from that time
on until 1878 we had practically gold
monometallism, whenever we had any
metallic basis at all for our currency.
Gold Would &c Hordcd.
1t would be n useless consumption of
time to so into II detailed account OF the
monetary legislation of this and other
countries, or to show at length how 1t
affected the movements and use of the
two metals by its repeated failures to
conform the legal ratio between them.
The great and important fact conclusively
established by the history of that legis-
lation and its effects upon the circulation
of the coins of the two metals is, that
whenever one of them Is oVer-yalued
relatively to the other in the coinage laws,
with free coinage or coinage upon equal
terms. and both are made legal tender,
the coins OF the under-valued metal Will
be driven out of circulation and out of
use as money in the country where the
unequal valuation is made. The reasons
for this are perfectly plain. Both being
| legal tenders, the least valuable coins
will always be used in making payments,
and will become the measures of value In
| the exchange of commodities, and conse
quently the more valuable coins will be
boarded or sent out of the country into Il
market where their real value will be
recognized. Now, as this is just what has
always occurrcd-at least in modern
times when commercial relations between
different countries are so intimate and
the means of transportation are so rapid
and cheap-even when the under-valuation
or generalization amounted to only / or
per cent, l think we are fully justified In
concluding that If the United States alone
should adopt the policy of free and unlim-
ited coinage of legal-tender silver at the
ratio of Is TO /. which would be an over
valuation of that metal to the amount of
100 per cent, the gold in the country
would be Immediately boarded or exported
or be held as a commodity by spectators
engaged in the business of buying and
selling it at premium. If this should be
the result, the free coinage of silver
would not for a long time add anything
whatever even nominally, to our stock
of money; on the contrary, the immediate
effect of such a policy would be a contran-
tion to the extent of fully one-third of our
present volume of currency by the eXpau-
sion of about S625, ,OOO. 600 in gold, and it
supply its place with silver dollars, even
If our mints coined nothing else.
All who have been or may be induced
to give their support to this revolutionary
policy upon the assurance that 1t will give
the country more money for use in the
transaction of business, will be greatly
disappointed, for they will find, when it is
too late, that instead of having more
money they will have less, and that it
will be deprecated in value besides The
introduction into the currency of a couE-
try of any kind of money about which
there is the least doubt will always oper-
ate to drive out the same amount, or
about the same amount, of better money
and thus leave the people with substan-
TALLY the same volume of currency they
had at the beginning. The act providing
for the purchase of silver bullion and the
issue of legal-tender treasury notes IN
payment for it was passed on the Nth
day of July, 1890, and the purchasing
clause of that act was repealed Nov. ],
1898. While it remained in force United
States treasury notes were isued to the
amount of Sl55, ,93l ,O02, and there were
many people who believed that this was
making n material and permanent addi-
ton to the volume of our currency; but
the official records show that during the
this country amounted to $l03,4l9,491, SO
that the real addition to our circulation
accomplished by the isue of nearly $780,,
900 of new notes was about fifty-two
and half million dollars during a period
of more than three years. The mere
apprehension that the government would
not be able to maintain the parity of the
two metals under the policy inaugurated
by that act, not only discredited the new
treasury notes themselves, but the whole
volume of our currency, and gold went
out about as fast as the new notes came
in. While, therefore, it Is not at all GER
tain that free coinage would ultimately
make any considerable addition to our
circulation, 1t is absolutely certain that
it would give us u deprecated and fiuc-
tuating currency, and the question Is
whether the producers of cotton, wheat,
corn, beef, pork, oil, lard, cheese, and other
cxportable articles will be benefited or
injured by such a result. 1t Is an axiom
in trade that the prices of eXportable pro-
l-ducts are fixed in tine foreign market
where the surplus is sold, and are fixed
I'm the currency of that country according
to its nominal value there. If sold in
England, for illustration, the prices are
fixed and paid In pounds, shllings. and
pence, and not in dollars and cents, and,
consequently, 1t makes no difference to
the foreign purchaser what kind of cur
rency the producer has at home The
character or value of the currency in use
in the producing country does not affect
the price of the article abroad to any ex-
tent whatever, for the purchaser there
trades in his own market and uses his
Would Not Increase Prices.
own currency in measuring values.
The establishment of "a silver standard
here could not possibly increase the price
of cotton or wheat or any other American
product in Liverpool, London, Paris, or
Berlin, whatever effect it may have upon
the nominal price in this country. If our
monetary system were so changed that
1t would require two dollars to purchase
here the same quantity of commodities
that one dollar will purchase now it
would not affect the value or purchasing
power of the English pound sterling, the
French franc, or German mark in the
least. The only effect would be that the
exchange would be doubled, and the pound
sterling instead Of being worth si.S66 in
our currency, as 1t Is now, would he
worth 49, 1872, and when our people wanted
| to make a remittance to pay a debt abroad
| they would have to pay twice as much in
oup,noney for the same number of pounds
as they pay now while the foreigner who
wanted to make remittance to pay O.
debt here would pay only half as much In
| his money for the same number of dollars
as he pays now. But the exchange would
| be in constant change of fuctuation,
| just as 1t has been between Great Britain
| and India on account of the changes in
| the prices of silver from day to day: and
| the American producer would be COM
PEELED to pay for the risk taken on ac-
count of the fluctuations by receiving a
less price for his cotton. wheat beef and
other articles. The farmers and planters
do not export their own products, but sell
| them at home to somebody else who
sends them abroad, and If the exchange
To or In, tub f,l IL.