The times. [volume] (Richmond, Va.) 1890-1903, 1895-05-31
how TO SECURE SOUND FINANCES
sttI>D ARTICLE.


how the Bank Of England, beginning the
practice in 1894 went right along ISSUING
its notes, payable 10 the bearer, which
IL always redeemed in coin whenever coin
WINS asked for until. i'm the course of
time. men began to look upon the notes
so faithfully redeemed always. as actual
money themselves, which they, OF course
were not, and could not be. Men forgot
all about their origin, and found them
answering all the purposes of money so
well that they came to look upon the
banks notes as being just as much
part OF their money as the coin OF the
realm.
But this fatal error grew out of the
facility with which the banks notes, al
WAYS redeemed In coin on demand, per
formed the work OF coined money.
school grew up that believed that If the
notes were the notes of Government II
self and, therefore. backed by all the
credit and resources of the Government
and were made legal tender in payment OF
ali debts. though not redeemable in coin
tive and useful as though they were
payable in coin on demand That error
has had the most astonishing prevalence
with mankind. and 1t is to-day ntrenched
I'm the minds OF hundreds of thousands
Of American voters. England has always
held IL i'm subsection. and her immense
wealth and power grows out of free
trade. connected with. and founded upon
that principle of finance. But 1t has had
prodigious sway in other parts OF the
world. IL was adopted by France In the
John Law experiment, tina; has -heen refer
red to. and again, during the great French
revolution, when. she issued millions on
millions Of her assignats. founded upon
this irredscmable idea. The John Law
business brought disaster upon France,
and the assignats went down to nothing,
and covered the whole face OF the coun-
try with bankruptcy and ruin.
P:ior TO our Revolutionary war our colo
niles founded their financial systems upon
the same idea. They issued their notes,
which were made legal tender for debt.
and In every case these notes brought
disaster and ruin on all that had any
thing to do with them.
our confederation Of the colonies issued
its notes by the hundreds of millions dur
Ing the Revolutionary war. and they all
became utterly worthless. running every
one who allowed his fortunes to become
involved with thcnt That was the
when the convention met In 1877. 20 form
the Constitution Of the United States. ex-
cept that the French assisnats came four
OF Ave years later.
The wise and the great men composing
that convention knew intimately well the
whole history Of paper money as II has
been set out herein. The members of that
convention knew the wreck and disaster
that irredeemable paper money. nominally
founded on Government credit had
brought on every people that had tried
II. but they equally knew the blessings
that howedIrom paper currency issued
by mere incorporated bank redeemable
always on demand IN coin. The Bank OF
England's record taught them that, and
there were three banks In this country, at
the time the convention met. doing bust
ness most satisfactorily 10 the people
where they were located, doing business
and issuing notes under charters granted
TO them by their States. This is fact OF
the last Importance In this connection.
This convention met then. resolved on
graphing with two conditions that the
people Of every part of the country were
crying out against. one was the opera
titn OF State lines on traffic and travel
between the States. and the other was
the possibility OF irredeemable paper
money in these United States that rested
only upon Government credit. whether
national or State. The records OF the day
make this fact as clear as the mondays
sun. Read the correspondence OF the
public men OF the day. and 81
will be seen that the two up
permost ideas In their minds. when con.
sidering the propriety Of holding a con-
vontion. were destruction OF obstacles &c
free intercourse between the States and
suppression OF all possibility to Govern.
nAut lsues Of paper money. Those we're