The times. (Owosso, Mich.) 1882-1897, 1895-12-06
NATIONAL FINANCES.
Cause md Cure of ond Issues-Dire En-
feet OF Free Coinage.

Cause and Cure of Il ond Issues-Dire Eff
feet OF Free Coinage.
AS we turn from a review of our foreign
relations to the contemplation of our ma
tional financial situation we are immedi-
ately aware that we approach subject of
domestic concern more important than any
other that can engage our attention, and
one at present In such perplexing and del
icate predicament as to require prompt and
wise treatment. We. may well be encour-
aged to earnest effort In this direction
when we recall the steps already taken
toward improving our economic and finan-
well the way has been prepared for fur
Their progress by an aroused and intelli-
gent popular inaerest IN these subjects.
Monetary Evils Not Cured.
BY command of the people a customs
revenue system, designed for the protec-
ton and benefit of favored classes at the
expense of the great mass OF countrymen,
pose of revenue, curtailed our trade rela-
lions and impeded our entrance to the
markets Of the world, has been superseded
by tariff policy which in principle is
based upon denial of the right of the gov
eminent to obstruct avenues to our peo-
pies cheap LIVING or Lessen their comfort
especial advantages to favorites, and
which, while encouraging our intercourse
and and trade trad WITH WITH other nations, recognizes
thrift and ingenuity, can build up our
country's industry and develop it's re-
sources more surely than enervating pa
ternalisLl.
The compulsory purchase and coinage of
silver by the government unchecked and
unregulated by business conditions and
needless OF our currency needs, which for
more than 10 years diluted our circulating
medium, undermined confidence abroad in
our financial ability, and at last culminat-
ed in distress and panic at home, has been
recently stopped by the repeal of the laws
which forced this reckless scheme upon
the country. The things thus accom-
extreme i'm
portancc and beneficient effects, fall far
short of curing the monetary evils from
diligence in ill-advised financial expedi-
entS.
Review OF Financial Legislation.
The currency denominated United States
notes, and commonly known as green
backs, was issued in large volume during
the late civil war and was intended origin
ally to meet the exigencies of that period.
1t will be seen by q reference to the debates
in congress at the time the laws were
passed authorizing the issue of these notes
that their advocates declared they were in
tended for only temporary use and to meet
the emergency Of war. In almost, If not all,
the laws relating to them some provision
was made contemplating their voluntary
or compulsory retirement. large guam
tity Of them, however, were kept on foot
and mingled with the currency of the
country, so that at the close of the year 1874
they amounted to 1881, 1893, 073.
Immediately after that date, and in JAM
uary, 1875, a law was passed providing for
the resumption of specie payments, by
which the secretary of the treasury was
required, whenever additional circulation
was issued to national banks, to retire
United States notes equal in amount to 80
circulation until such notes We're reduced
to $500, 0,000 This law further provided
that on and after the LIST day of January,
1879, the United States notes then out
standing should be redeemed in coin, and
in order to provide and prepare for such re-
demption, the secretary of the treasury
mt nr nf m 70
plus revenues of the government, but to
issue bonds of the United States and dis
pose of them for coin, and to use the pro-
ceeds for the purposes contemplated by the
statute
In May, 1878, and before the date thus APP
pointed for the redemption and retirement
of these notes, another statute was passed
forbidding their future cancellation and
retirement Some OF them had, however
been " and SanGelled
circulation, as permitted by the law of
1875, so that the amount outstanding at
the time of the passage Of the act IT. forbid
The law of 1878 did not stop at distinct
prohibition, but contained in addition, the
any of said notes may be redeemed or be
received into the treasury under any law
from any source whatever, and shall be-
long to the United States, they shall not be
retired, Cancelled or destroyed, but they
shall be reissued and paid out again and
kept In circulation"
Creation or the Reserve.
This was the condition of affairs on the
LIST day OF January, 1879, which had been
fixed upon four years before as the date
for entering upon the redemption and re-
tirement of all these notes, and for which
such abundant means had been provided.
The government was put In the anomalous
situation of owing to the holders of its
notes, debts payable in gold on demand
which could neither be retired by receiv-
ing such notes in discharge of obligations
due the government, nor cancelled by actual
no ont In
without redemption and to pay without
acquittance. There had been issued and
sold 495,500,00O of the bonds authorized by
the redemption act of 1875, the proceeds OF
which, together with other gold in the
treasury, created a gold fund deemed suf-
ficient to meet the demands which might
outstanding. United States notes This
fund, together with such other gold as
might be from time. to time in the treas
been since called our gold reserve, and
500, 100000 has been regarded as an ade-
quate amount to accomplish it's object.
uary, 1879, to $114 1913, $50, and though there
after constantly fuctuating it did not fall
below that sum until July, 1892. In April,
1893, for the first time since it's establish
ment, this reserve amounted to less than
$l0O, 100000, containing at that date only $751;
OH, $3.50.
In the meantime, and in July, 1880, an act
had been passed directing larger govern
mental monthly purchases of silver than
ndu Deen required unCer previous laws, and
providing that In payment for such silver
treasury notes of the United States should
be issued, payable on demand in gold or
silver coin, at the discretion of the secre-
tary of the treasury. II was, however, de-
clared In the act to be "The established pol
Icy of the United States to maintain the
upon the present legal ratio or such ratio
as may be provided by law" In view of
this declaration 1t was not deemed per-
missible for, the secretary of the treasury
to exercise the discretion in terms con-
ferred upon him by refusing to pay gold on
these notes when demanded, because by
such discrimination In favor of the gold
dollar the so-called parity of the two metals
would be destroyed and grave and danger
Gus consequences would be precipitated by
affirming or accentuating the constantly
widening disparity between their actual
values under the existing ratio.
Cause of Depletion of the Reserve.
1t thus resulted that the treasury notes
issued in payment OF silver purchases un-
der the law OF 1890 we're necessarily treated
as gold obligations, at the option of the
holcar. These notes on the LIST day of Mo-
vember, 1893, when the law compelling the
monthly purchase of silver was repealed
amounted to more than S155,000000 The
notes OF this description now outstanding,
added TO the United States notes still UNI
diminished by redemption or cancellation,
constitute volume of gold obligations
amounting to nearly $500 100000 These OBJ
legations are the instruments which, ever
since we have had gold reserve, have
been used to deplete IT, This reserve. rs
has been stated. had fallen in April, 1898. to
I.es O. -. .