The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1896-10-23
WHAT SECRETARY MANNING DID.

The story is still on its travels of
how Secretary Manning told the bank
ers, who, in 1885, were drawing gold
from the treasury, that if they did not
stop it he would pay them in silver,
and it now has a travelling COM
panion in the story that he threatened
the bondholders with payment in sill
yer. 1t seems to be useless to try to
arrest these jolly and irrepressible
travellers and stop their progress, for,
with imperturbable caImness, they ig-
more arrest and pursue their way with
undiminished assurance. But their
presence invites attention to what the
great secretary did to meet a condition
almost precisely similar to that which
confronted Secretaries Foster and Car
isle from 1891 to 1893, one springing
from the same source, the limited
greenback issue, increasing to tor
rent as the Allison certificates and the
Sherman notes poured their food
into it.
The conditions in 1SS4-5 showed the
same Indication of panic that existed
In the fall of 80, and eliminated in the
panic of 1893. 1t was Manning's finan-
cial genius that prevented the panic
of '93 occurring eight years earlier.
There had been the surge of specula-
ton eliminating in 1882, as there was
the boom that broke in 1892 The aug
mentation of the currency, through the
operation of the Allison act, had first
stimulated business that led rapidly
into speculation, and then bred dis
trust and discrimination, just as the
Sherman act did later. Gold and gold
certificates, that, in the last six months
of 1888, We're "a per cent of customs
receipts in New York, fell to 30S per
cent in the same period in 1884. 1t
was Acton, Arthurs assistant secre-
tary of the treasury, who, in March,
1884, intimated that he might have to
pay cut silver, and the response was a
premium on gold. The passage of the
Sherman act was almost Immediately
followed by the same danger sign, the
discrimination in the money in which
taxes were paid, by the substitution of
paper for gold in customs
Gold also began to be taken out of
the treasury through greenback re-
demptions for boarding Thirty-nine
million dollars went out in the first
eight months of 1884. Secretary Nc
Culloch reported to congress in Decem-
Der that year that "a panic or an ad
verse current of exchange might COM
pei the use of silver in payment Of
gold obligations" This was the condi-
ticn that confronted Manning when he
assumed the treasury in 1885. BY July
the gold reserve was down to S115,O0
600. and, instead of "raiding the treas
Ury," the banks in the New York ctear-
ing house exchanged $4,000, 900 of gold
for fractional silver. His predecessor
had warned them of possible conse-
quenees. lit did not need any threat
from Manning. Manning surprised the
country with the extremely able finan-
eiering with which he met the crisis.
He began shortening the '.endless
chain" by holding greenbacks in the
treasury as much as possible, and by
changing their denominations from
small - large notes, chiefly of $1,000
each. In a year he thus transformed
ever $21, 100000 This increased the de-
mand for silver certificates in the cir
culation. He secured from congress
permission to change the cleaomina-
tions of these, none of which was
smaller than SO, to ones twos and
t1ves. This secured an increase of
these certificates in the circulation
from over SsS.OOO,00O in 1886 to over
s142. 900 in 1887. and to over s257, ooO.-
O00 in 1889.
But the Immediate effect of Man
ning's policy was to restore confidence
III the stability of the currency. Trade
responded to it; men no longer dis
eliminated between the forms of mon
ey in paying taxes: gold flowed in again
at customs, and the free gold in the
treasury rose in 1888 to over S2Is 600, 600.