The representative. [volume] (St. Paul, Minn.) 1893-1901, 1896-01-15

locally initiate prices, to stimulate i'm
ports, resulting in an accumulation OF an
adverse balance of trade, such as we have
experienced after the bond issues of the
past year, an increased demand for gold
for export and an increased drain ON the
gold reserve.
The $1S2 200, 900 in gold has gone as the
hundred million more now about to be
borrowed VIII inevitab bly, go, but certain
ly it did not leave void in the treasury.
The gold was replaced by greenbacks and
treasury notes, and these were added to
the cash resources of the treasury. So.
while the issues of bonds failed of their
purpose. they did add 1882, 900, 900 to the
cash resources of the treasury In short,
the attempts to borrow gold have result
ed in borrowing greenbacks and treasury
notes Half of the United States legal
tender notes and treasury notes of 1890
thus received by the treasury, have been
reissued, and are now outstanding: half
are still in the treasury. The $50 ,000O 900
or so Of treasury notes and greenbacks
still in the treSury, represent an addi-
tiOn to the resources of the government:
a decrease of actual indebtedness of like
amount
And the $90,0OO,0OO or so outstanding;
why are they outstanding? Surely they
were not given away They were paid
away to meet the expenses of the govern
ment. because during the twenty-three
months since the first bond issue, receipts
have failed to meet the expenditures of
the government by 100000, 900, and, it be-
ing necessary to meet this indebtedness,
the greenbacks and treasury notes re-
deemed with the gold borrowed, were
| used for this purpose
,oJ ~,
February, 1894, the gold reserve stood
at $65,OOO000, and the net cash balance
at less than $20,0OO,OOO Today the gold
reserve stands at less than 5000, 900,
and the net cash balance, chiefly green
backs and treasury notes redeemed with
the borrowed gold, at S110 100000. Thus
the notes received for the gold borrowed,
to an amount of over $180,000 600, have
been used, $90,000,000 to meet the deficit
and $9O,O00,0 900 are still in the treasury
To say then. that the government has
received nothing in exchange for the
gold used to redeem the greenbacks and
treasury notes, because the greenbacks
must be, and the treasury notes, for the
most part have been, reissued. is absurd.
The greenbacks and treasury notes are
not given away. Ii not required to meet
the deficiency in revenue, they would ac-
CuuIuldlt Ill tlC treasury. AS II is, xyU,
100000 have been used to meet the ex-
penses Of the government $4,000 10000
are now in the treasury. and the govern
ment is paying running expenses with the
notes received N exchange for the gold
so arbitrarily and unnecessarily borrow
ed
10 accumulate the greenbacks and
treasury notes in the treasury must be
injurious, for 1t is equivalent to con-
tracing the currency, and must lead to
lower prices. The true policy is to nav
these notes as by law authorized IN either
gold or silver, the secretary of the treas
ury using whichever metal it is most con-
venient for him to pay. Then the de
mand for export would not be thrown on
the treasury, there would be no drain on
the treasury for gold, and there would be
no injuious accumulation of greenbacks
and treasury notes as the result of re-
demptiOnS.
1t is not the way to provide for de-
fic.ency by borrowing gold ostensibly to
redeem the greenbacks and treasury
notes, and to use the notes so redeemed
to meet the expenses of tn government
When the flag was first made all the
men of the land were free-but the
black men; they were slaves. Then
there was great war, and the slaves
were made free. But in the next few
years bad laws were made to help the
rich heap up more wealth and force the
poor to work for small pay if they get
work at ALL Now few are free but the
rich. But the poor have the most votes.
Some day they will learn to use them.
and choose men to make laws, so that
all may have a share of the wealth that
their work makes. Then all in the land
will be free, and all will love the flag
From First Reader in Social Economics.