The Vermont watchman. [volume] (Montpelier, Vt.) 1883-1911, 1896-08-05
Whit is Free Coinage :


During the past week farmer, an
occasional writer for the agricultural
press of New England, brought to the
WATCHMAN office for publication a
communication on the value of
silver dollar, should the populists win
in the national election and their finan-
cial policy be adopted. He was dis
putting the statement of the WATCH
MAN in recent articles that at the pres
ent commercial value of silver the
dollar would be worth but about SO
cents, and that would be the extent of
its purchasing and debt-paying value.
1t appeared that our correspondent,
like many other people, was reasoning
from a misunderstanding of what is
meant by free coinage. AS he stated
it, his idea was that under the financial
system the populists propose, "The
government will buy all the silver that
is offered for sale and pay for it at the
rate of one dollar per ounce regardless
of its market value "; that "the mo-
ment the president signed free coin
age bill the market value Of silver
would leap to one dollar an ounce"
but that "the government could main
tain the value of silver above its market
value only so long as it had gold to
exchange for that commodity" 1t was
explained to the writer of the COM
munication that his understanding of
free coinage was erroneous that un-
der the financial system proposed by
the populists, both at Chicago and st.
Louis, the government would buy no
silver at any price that the govern
ment would simply receive the silver
bullion, the uncoined silver, at its mint,
convert it into standard silver dollars
and return the coins to the owner, less
the charge for coinage, precisely as
when the farmer takes bushel of corn
to the mill to be ground, the miller re-
turns to him the meal, less the toll for
grinding. The miller does not buy the
corn, or pay gold or any other money
for it no demand for corn is created
and its price is not affected by the
transaction the farmer takes back to
his home the corn he brought SO
changed in form as to become "cur-
rent" for domestic uses. The office of
the mint is simply to stamp upon the
coins it returns to the owner of the
silver the governments certificate that
each coin is of legal weight and fine
ness. They then become current for
commercial uses. The possessor takes
them to town to buy clothing for ex'
ample. He finds that suit of clothes
that sold for $40 under the gold stand
ard will cost him nearly 500 in the
money the populist administration has
made receivable for all debts, public and
private.
The fountain cannot rise higher than
its source, under natural conditions
and 53-cent dollar, under natura
commercial conditions, can buy but 8;
cents worth of clothing, or any othel
merchandise, although the government
fiat, in defiance of general laws, makes
it 100 cents. That 53.cent dollar il
worth 100 cents now, and will buy 10'
cents worth of goods, simply because
the national government puts 100 cent
in gold, the money of the world, behint
it. The government is maintaining it
"parity" with gold. Remove thi
prop, as the populistic democracy pro
poses to do, and it would drop to it
commercial value, which at present i
about SO cents, and - theoretically Vi
would buy but SO cents worth of goods
In practice it is likely that it would bu,
less. The prudent merchant woul
safeguard himself against possible fur
Their shrinkage in the value of this de
based and fluctuating populistic none
in fixing the selling price of his mer
chandise.