The Cook County herald. [volume] (Grand Marais, Minn.) 1893-1909, 1896-09-12
WHY IT WAS DEMoNETIzED.

I WHY IT WAS DEMoNETIzED.
Knocking Out silver Gave Many millions
to Foreign Bondholders. rs
From Speech by Hon. Alex: Del Mar Be
fore the Memphis Silver Convention in
June, 1896. 1. W ~ ID. r.. Z
The monetary commission of 1876
with which 1 was connected, reported
that the acts of 1873 were, one of them
passed surreptitiously, and the other
upon false or erroneous assurances
This has since been vehemently de.
MED. am going to show you not only
that the commission was right, but that
these acts were the issue of European
intrigue and precedent.
At the period of this legislation the
ratio of value at which silver and gold
were purchased and coined at the
French minis was fifteen and one-half
weights for one; at the minis of the
United States, sixteen to one. In conse-
quence Of this difference (about three
per cent?, those who had silver to coin
sent it to Paris rather than Philadel-
phia, San Francisco or New Orleans.
Had the opposition to the coinage of
dollars in the two metals and the pref
erence by creditors of the government
for. one metal over the other been of
American origin, the one metal chosen
would inevitably have been silver, be-
cause, in fact, the silver dollar was
worth l,o
gold one, and because the fundholders
who VIGOROUSLY promoted and sup
ported the legislation of 1873 would no
more have preferred gold dollars then
than they would silver dollars now.
But in France-indeed, in Europe gen
erally-whose minis and markets COM
monty followed the vast coinage of
France, the gold and silver coins of like
denominations were of precisely equal
value. Hence to the European holder
of American bonds in 1S63-64 it made no
difference whether he was paid in gold
or silver coins, provided-and this was
the point essentially important to his
interest or avidity-provided that the
debtor was deprived of the option of
paying in coins of the other metal. The
preference of gold was certainly not
American, because at the American
mint ratio gold dollars, when melted
down, were only worth 81 cents. 1t
was therefore of European origin. We
shall presently see why these 'cheaper''
dollars were preferred to silver cnes.
Under the Code Napoleon it was ex-
plicitly laid down that all debts, taxes
and contracts for sums of money, no
matter in what other terms expressed,
were legally and equitably Discharged
BILE in the current money of like denomi-
nations upon the day of payment. This,
principle came down from the Roman
commonwealth; it, was preserved by
Paulus in the Digest; it was upheld by
all the journalists of the empire and Of
the various provinces and kingdoms
into which the empire afterwards split;
it was supported with great emphasis
and erudition by Sir Mathew Hale in
the celebrated case of mixed moneys.
and it was maintained by the United
States supreme court in the great cases
which were adjudicated by Chief Justice
Chase and full bench.
At the time when the necessities of
our government compelled it to issue
hundreds-nay, almost thousands-of
millions of six per cent. and five per
cent. bonds, with interest payable in
''coins," the French court of cessation
promulgated decision in perfect ac-
cordance not only with the entire range
of legal authority, but also with the
Code Napoleon, to the effect that on
this subject no man could contract him
self out of the law; in short, that con-
tracts for money were equitably dis
chargeable in the current money of
the day of payment. This decision
alarmed the European holders Of
American bonds. What might not these
shrewd, those progressive Americans
DO with respect to the interest on these
bonds, which was payable in ''coins 2"
Perhaps they would strike coins of de-
based gold, like the ancient Athenians,
or of pewter and gun metal, like the
princes of the house of Stuart, or plated
brass, like the petty lords of then dis
tracted Germany. Would they not be
justified by law, by history, by authori-
ty, by precedent, by the decision so re-
Gently rendered in our French court of
cessation? Most assuredly.
There was but one way to avert this
fanciful calamity. This was to de-
monetize one of the precious metals and
fix the standard of the other. But which
metal should be demonetized? Gold !?
Oh, no; the American government would
never consent to that, because it would
oblige them to Fay in silver dollars,
which, under the operation of their own
laws, as Influenced by our (the French
mint) law, are worth three per cent.
more than gold ones. Therefore, let US
endeavor to demonetize silver. TO us
it. makes no difference; to the Ameri-
cans it is gain of three per cent. Let
us bride them with this three per cent.
to surrender their option of the metals.
All doubt as to the kind of payment be-
ing then removed, our American bonds,
purchased at 40 cents, will rise to par