Evening star., 1896-08-13


be at the ratio of 16 to 1 we simply ask
that our gold coins and the standard sill
yer do!lar-which. be 1t remembered, con-
tafns the same amount of pure silver as
the first silver dollar coined at our nlints-
retain their present weight and f1neness.
The BimetaIlic System.
1.-The theoretical advantage of the BIZ
metallic system is best stated by Euro
peon writer on political economy, who sug-
gests the following Illustration: A river fed
from two sources is more uniform in vol
ume than river fed from one source the
reason being that when one of the feeders
is swollen the other may be low; whereas,
river which has but feeder must
rise or fall with that feeder. So, in the
case OF bimetallism, the volume Of me-
tallic money receives contributions from
ooth the gold mines and the silver mines,
resting upon two metals, is less changea-
BILE in its purchasing power than the dol
lar winch rests on one metal only
IF there are two kinds of money the
option must rest either with the debtor or
with the creditor Assuming that their
rights are equal, we must look at the in
terests of society in general in order to de-
term!ne to which side the option should be
given. Under the bimetallc system gold
and silver are linked together by law at
fixed ratio, and any person or persons own
ing any quantity of either metal can have
the same converted into full legal tender
money. If the creditor has the right to
choose the metal in which payment shall
be made. it is reasonable to suppose that
ne Will require the debtor to pay In the
dearer metal If there is any perceptible
difference between the bullion value of the
metals. This new demand created for
the dearer metal will make that metal
dearer still, while the decreased demand
for the cheaper metal will make that metal
cheaper still.
IF. on the other hand, the debtor exer-
cises the option, it IS reasonable to sup
pose that he will pay in the cheaper metal
If one metal is perceptibly cheaper than
the other, but the demand thus created for
the cheaper metal will raise its price, while
the leSSened demand for the deareT metal
will lower its price. In other words, when
the creditor has the option, the metals are
drawn apart; whereas, when the debtor
has the option the metals are held TO-
gether approximately at the ratio fixed by
law, provided the demand created is suf-
ficient to absorb all of both metals pre-
sented at the mint. Society is, therefore,
interested in having the option exercised
by the debtor. Indeed. there can be no
such thing as real bmetallism unless the
option is exercised by the debtor. The
exercise of the option by the debtor COM
pelS the creditor classes, whether domestic
or foreign, to exert themselves to main
tain the parity between gold and silver at
the legal ratio, whereas they might find
profit in driving one of the metals to q
premium If they could then demand the
dearer metal. The right of the debtor
to choose the coin In which payment shall
ne made extends to obligations due from
the government as well as to contracts be-
tween individuals.
Government Obligation.
"A government obligation is simply debt
due from all the people to one of the peo-
pie, and 1t is impossible to justify policy
which makes the interest Of the one person
VINO holds the obligation superior TO the
rights of the many who must be taxed 70
pay it. When, prior to 1873, silver was at
premium it was never contended that
national honor required the payment of
government obligations in silver, and the
Matthews resolution, adopted by Congress
in 1873, expressly asserted the right of the
United States to redeem coin obligations in
standard silver dollars as well as in gold
coin.
Upon this subject the Chicago platform
reads: We are opposed to the policy and
practice of surrenderinE to the holders of
the obligations of the United States the op-
tion reserved by law to the government of
Iedeeming such obligations in either silver
coin or gold coin
1t is constantly assumed by some that
the thlted States notes, commonly called
greenbacks, and the treasury notes. issued
I nder the act Of 1880, are responsible for
The recent drain upon the gold reserve, but
this assumption is entirely without founda-
tion. Secretary Carlisle appeared before the
House committee on appropriations on jan
rary 2l 1888, and l quote from the printed
report of his testimony before the COM
mittee:
Mr.. Sibley-I would like to ask you fper-
faps not entirely connected with the mat
ter under discussicn) what objection there
could be to having the option of redeem
ing either in silver or gold lie with lhe
treasury instead of the noteholder?
Secretary Carise-If that policy had
been adopted at the beginning of resump-
tion-and I am not saying this for the pur-
pose of criticising the action of any of my
predecessors or anybody else-but If the
policy of rescrvfng to the government at
the beginning of resumption the option of
redeeming in gold or silver all its paper
presented. / believe 1T would have worked
beneffcially and there would have been no
trouble growing out of 1t, but the Secre-
taries Of the Treasury from the beginning
Of resumption have pursued policy of re-
Geeming in gold or silver at the option of
the holder Of the paper and If any Secre-
tary had afterward attempted to change
that policy and force silver upon a man
who wanted gold, gold upon a man who
wanted silver, and especially If he had
made that attempt at such critical period
as We have had in the last two years. my
Judgment is 1t would have been very disas-
trouS.'
The issue of Bonds.
Il Go not agree with the Secretary that
it was wise to follow bad precedent but
from his answer it will be seen that the
fault does not lie with the greenbacks and
treasury notes, but rather with the execu-
tive officers who have seen fit to Surren-
der right which should have been exer-
.cised for the protection of the interests of
the people. This executive action has al
ready been made the excuse for the issue
OF more than $3.50, 900, 900 In bonds, and 1t is
Impossible to estimate the amount of bonds
which may be hereafter issued If this
policy is continued. We are told that any
attempt upon the part of the government
at this time to redeem its obligations in
silver would put a premium upon gold,
but why should 1t? The Bank of France
exercises the right to redeem all bank pa
Per in either gold silver, and yet France
maintains the parity between gold and sill
Yer at the ratio of 151a to 1 and retains in
circulation more silver per capita than We
do In the United States.
opponents have suggested no feasible plan
for avoiding the dangers which they fear.
The retirement Of the greenbacks and
treasury notes would not protect the treas
ury, because the same policy which now
leads the Secretary Of the Treasury to re-
dev-n all government paper in gold, when
gold is demanded, will require the redemp-
tion Of all silver dollars and silver certifi-
Gates in gold if the greenbacks and treas
try notes are withdrawn from circulation.
More than this. If the government should
retire its paper and throw upon the banks
the necessity of furnishing coin redemp-
tion, the banks could exercise the right
to radeap, SIC ob1foatton in silver wfep Gil.