The Democratic advocate. [volume] (Westminster, Md.) 1865-1972, 1896-02-29


the present condition of the Treasury is and
the urgency existing for relief of the charac-
ter in question.
The resumption act of 1875 provided that
the outstanding legal-tender notes known as
'igreenbacks'' should be redeemed and can
celed until the amount was reduced TO II
maximum of $500, 000, 900, but when the
amount outstanding had been reduced to
S346, 68l. Ol6 Congress passed another act,
prohibiting any further reduction and pro-
viding that any greenbacks that should be
thereafter redeemed should not be cancelled,
but should be ressued. 1t was at the same
time provided that reserve fund of $780,
000,000 should be held in the Treasury for
the redemption of the outstanding greenbacks
when presented.
The amount of greenbacks thus kept out
standing and subject to reissue has since been
augmented by over hundred million of coin
certificates known as SHERMAN notes,
which the Treasury has ruled to be payable
in gold.
Mr. Cicveland's complaint is that these
outstanding notes constitute an ''endess
chain, viii III, being presented for redemp
ton out of the gold reserve and being again
reissued in payment of current expenses, are
again collected by persons having designs
upon the Treasury gold reserve and quickly
brought back for second redemption, and
thus the ''eudless chain goes on depicting
the Treasury of its gold and bringing the re-
serve fund down below the safety line indi-
Gated by law.
It is fact. however, shown by figures
which have been given out by the Treasury
Department, that during the period of ID
years from July /, 1879, up to July |, 1892,
with the same conditions existing, the re-
demption of United States notes in gold
averaged less than 50, 000,0 IA year. Thus
the endless chain was wholly imperative or a
mere bagatelle during that long period, and
the gold reserve was preserved without I'M
parment 1t is only within the last year or
| two that the endless chain has assumed such
dangerous proportions as to require the issue
of bonds in large amounts to maintain the
gold reserve.
The Republicans, in opposing the Presi-
dents plan, insist that it the necessities Of
the Treasury did not require the payment out
of the greenback notes for current expenses
| as soon as redeemed there would be no mo-
tive for the conspiring bankers to put the
endless chain in motion. Although the green
backs cannot lawfully be cancelled, yet there
is no obligation of law upon the Treasury to
pay them out again as soon as redeemed, and
if it were not for the necessities of the Treas
ury under deficient revenue to keep tn is
endless chain in motion, and thus unwillingly
cooperate with the conspiring bankers, there
would be no motive whatever for passing in
the greeubacks for redemption.
Upon this point there seems to be no room
for doubt. From the time the gold reserve
was first established in 1879 up to S92 there
was no endless chain, simply because there
was more or less of surplus revenue during
those years, and the redeemed greenbacks,
though not cancelled, were not paid out for
current expenses, but held as part of the
Treasury surplus aud as representative OF the
gold from the gold reserve that had been used
for their redemption and into which they
were at any time convertible. rhe -aiention
of the redeemed greenbarks for this purpose
was in conformity with Il most obvious finan-
cial principle, and that course would unques-
tionably have been pursued by this Admins
tration but for the deficiency of revenue which
compelled shv paying out of the greenbacks as
som as redeemed for pressing current ex-
penses.
In the light of these very obvious facts,
which are now well known and generally
recognized, il becomes manifest that the tend
less chain theory is merely an invention Of
the Treasury TO avoid confession of IA def
cheney of current revenues as the true evil
which is threatening the public finances and
of the enforced use of the gold reserve 10 pay
current expenses. 1t follows, therefore, that
the substitution of interest bearing gold bonds
for the nearly $500, 100000 of outstanding
Treasury notes, and the consequent large com
traction Of the currency with its corresponding
increase of nterest-bearing debt, would not
remedy the evil
But it ought to be understood that the
present deficiency of revenues which aiflicts
the Treasury did not originate under the
Democratic tariff law. 1t existed under the
Mckinley law also. The Mckinley law, in
the interest of protection, put up duties so
high above the revenue standard in the direc-
ton of the prohibitive line as to unduly
shorten the revenues while the Wilson BILL
in the interest of free trade, went so far
toward the other extreme as to accomplish in
a far greater degree the same undesirable re-
suit The Senate corrected the errors of the
Wilson bill TO large degree, but there was
an uncertain condition of increasing stagna-
ton of trade and industry existing at the time
of the enactment of both the Mckinley and
the Wilson laws, exercising a strong influence
upon the revenue producing quality of tariff
duties, that it was difficult to make accurate
allowance for, Besides, the failure of the in
come tax threw further embarrassment on the
Democratic plan.
II was in recognition of these conditions
and in anticipation of the very results that
have so surely followed that Senator German
proposed in the last Congress, as an amend
ment to the pending appropriation bill, an
authority to the Secretary of the Treasury to
issue short-time low-interestng-bearin popu-
lar loans TO tide over temporary DEFICIENCIES
of revenue likely to result from these uncer,
tain conditions. In his prophetic speech of
January Is, 1895, he appealed to the patriot
ism of the Senate by some such wise provision
aat To 10 ,f.
further issuance of longtime interest bearing
obligations to meet the current expenses Of
the Government. Leading Republicans were
ready to cooperate in placing this safeguard
in the hands Of the Secretary of the Treasury;
but in that unfortunate spirit of arrogance
which at that time afflicted the Administration
in its fatal effort to convince the country that
a superabundance of revenue had already
been provided, this wisely planned safeguard
was lightly rejected by the Treasury; and now
it is that the Administration is tasting the bit.
ter fruit of its own indiscretion and want of
foresight.
1t is truly "a condition and not a theory
that now confronts us. y A bonded debt is
being piled up in consequence of deficient
revenues. There is one of three courses open
to the Administration. Either it must accept
the authority to issue short-time certificates of
Indebtedness to meet current deficiencies, as
proposed by Senator German in the last Con-
gress and then rejected it must initiate the
course of the last Republican administration
under similar circumstances and refuse to
meet some of the less urgent appropriations
of Congress or it must accept the increased
rate of duties proposed by the Republicans
provided they succeed in sufficiently untang-
ling themselves to make this tender of their
good Offices.
The Democrats in Congress, with full
knowledge that the deficiencies of revenue
are purely temporary, will resist any increase
of tariff duties. 1t is probable, therefore, that
the Administration will find its remedy to ex-
isting evils in one or the other, or a partial
adoption of both of the two first remedies last
above suggested. VERlTAs.
The Oldest man in Indiana, James II. Cul-
yer, of Spencer, died February IL, at the au-