, 1896-10-10

and the premium on the gold dollar would of
course ii:c; nat. TO tie SIZE .-tc.it. thus af.
fording al opror .1nity 10 hu..lo: broker rs and
SPECTATORS I" buy and sell it at a profit. 1t
would cease 70 br used rs money, because no
man would pay his debt i'll gold dollarsor in
paper redeemable in gold dollars, worth 100
cents, when the law permitted him to pay it
In silver dollars, worth only 81 or :! cents.
The sudden withdrawal of ss2u. 900. COZ from the
VOLUME OF currency in the country would UNI
doubtedly produce u financial and industrial
disturbance far more disastrous to the inter.
ests of labor than has ever been experienced
In our history, and no man who has a particle
OF sympathy fuf working men and women and
their dependent families can contemplate the
possibility Of such a calamity without feeling
that 1t is his duty. whether no occupies n pub
lie or II private station. to employ every hon
orablc means at his command to avert it.
While the sudden expulsion Of $500, OO, 100 In
gold from our stock of money would itself be
sufficient to create "A financial disturbance I'M
parallelcd in the history of this or any other
country the situation would be very greatly
aggravated by the fact that the purchasing
power of all the remainder OF our currency
would be suddenly reduced about ont-half
we should have only about two-thirds as much
currency as We have now, and at the same time
1t would be so deprecated in value that it
would require about twice as much rs we have
now to transact the business of the country,
provided there should be any business to
transact.
Double Standard = Failure.
The attempt to maintain what is called the
double standard of value-thAt is, to attempt
to keep the legal tender coins OF the two met
ais, gold and silver, in use as money ut the
same time, upon u ratio of value fixed by law
has repeatedly been made by kings and par
lament in every civilizud country in the
world, and it has failed again and again in
every one of them, and it requires no gift of
] 1lrlrAhlfN. tn fny,.S,. th.f ~ pt,Ft continue 70
fail So long us self interest constitutes n CON
trolling factor in the business affairs OF men.
Without tresnassing upon your patience to
review the monetary history Of other coun.
tries in which this experiment las been made
and failed it may be advantageous tic .efcr
briefly to our own experience upon this sub
ject. When it was determined to adopt 4
monetary system for the United States and
establish a mint, Alexander Hamilton and
Thomas jefferson, two men who Offered
widely upon almost every public question and
whose names rs founders md leaders of their
respective parties will live as long as our pc.
litical literature is read, agreed that in deter.
mining what should be the coinage or legal RI.
ito between gold and silver the true relative
commercial value OF the two metals in the
markets of the world must AIst be i.scertaincGr,
and that this relative valuc. when ascertaincd,
should be incorporated into the statute rs the
basis of the proposed system OF coinage. Al
though they were party leaders, they were
statesmen and patriots, and when they wer.
called on to consider this great business ques-
ton affecting all the private affairs OF their
fellow citizens they eve it II thorough and
impartial investigation upun its merits, with
out regard to the effect their decision might
have upon their own political fortunes or
upon the political fortunes Of their followers
The "Fathers" Not Disturbed by This De-
lLsion.
These great men we're never disturbed for n
moment by the delrsion that congress could
fix by statute the actual or relative values Of
gold and silver any more than it could fix by
statute the actual or relative valves of u pound
of lead and IL pound Of iron. They knew that
gold and silver, like all other cxchangeable
things, are commodities and that their value
will be fixed in the markets of the world.
They knew that it was entirely competent, in
fact necessary, for congress to declare the rn-
ito upon which the two metals should be coined
at tho mint, il they were to DO coined ut all,
but they knew equally well that If the ratio so
declared did not correspond substantially with
the ratio which the commercial world had es-
tablishcd, the coins Of tho two metals could
not be kept in use rs money at the same time,
and consequently, Us / have already said, they
determined to ascertain the commercial ratio
and to adopt it. They reached the conclusion
that the true commercial ratio Mt that time
was IL to THAT is, that 10 ounces Of silver
were equal in value to / ounce of gold and
accordingly the act Of l192,, which was our first
coinage law, authorized the coinage Of the two
metals at that ratio.
At the ratio thus established the silver dol
lar contained 31l14 grains of fine silver and
the gold contained 2iS4 grains of fine gold, but
1t was soon discovered that u mistake had been
made and that 5,ll4 grains Of fine silver were
not in fact equal in value to 2i54 grains OF fine
gold, and the consequence was that, although
the difference between the value of n silver
dollar and the value of n gold dollar was only
- -. -A,,N ,.l,,nH
drove gold out of use md out OF the country,
and from that time we had silver monometal-
lism until after the passage of the acts of 1884
and 1887.
The fact that the silver was put into the
form of n coin and made legal tender the same
Us gold, and that both dollars were declared
to be worth no cents each, did not increase
the value of the Ella grains of silver to any
extent whatever. The people could not be de-
ceived by mere words printed in a statute;
they soon learned that the metal contained
In tho silver dollar was not equal in value
to the metal contained in the gold dollar.
and they paid silver to their creditors and
boarded tho gold or sent it out of the coun-
try. Even our new and full weight silver
coins would not circulate or remain in the
country, because congress. by various acts,
made certain foreign coins legal tender in the
payment of debts, and rs they were generally
10 worn by abrasion Ms to be of less weight
than tho new domestic coins they drove our
dollars and half dollars, md to u large extent
our quarters and dimes also, out of use rs
money. Our own coins were exported and used
at theil bullion value in making purchases
and paying debts abroad, and Mr.. jefferson
himself, who had then become president Of the
United States, issued an order on the first day
Of May, 1905, stopping the coinage of silver
dollars at our minis. No more silver dollars
were coined until 1856, 90 years afterward, and
then only 1000 Of them were issued from the
mints.
Rsstoration Of Gold tandHrd In 1884.
Gold having left the country, congress, in
1884, during the administration of Andrew
jackson, determined to restore 1t to the circu.
lstion and, In order to accomplish that result,
the legal ratio was changed from is to ! to
about 10 to l-that IL, the law 30 amended as
to provlIe that the gold eagle. or $40 piece.
should contain 22 grains of pure gold. which
made the dollar consist Of 70 10 grains, but by
the act Of 1887 1t was changed to 1922 grains,
which now constitutes the dollar and unit Of
value. This was q slight generalization OF gold
in the coinage. because G.2 grains OF hne gold
we're not In fact worth as much in the mar
kets az 87lA grains Of fine silver. Although the
difference In value was very small, II proved
sufficient to change the whole character Of our
metallic currency. ind under this ratio gold
and silver exchanged places. Silver went out
Of the country and gold came In. and from
that time until after the passage of the act Of
1873 we had practical gold monometallism,
except during the period OF the war. when we
had no metallic money Of any kind. When the
great civil war began, we had no silver In
circulation except the subsidiary coins author
ised by the act Of 1858, but we had old and
paper redeemable in gold, and II was not long
bc}ore we had another practical illustration Of
the natural law that the inferior or less vaiu-
ahls legal tender currency will expel the su.
psrtor or more valuable legal tender currency
fSum circulation.
Pager Currency Of War Period.
Early In 1852 congress, most unwisely. in my