The Monitor-register., 1896-06-26
Communicated.
Published by request of j. Walter Pancoast
as one of the monographs on the
silver question.
Bimetallism
BY A j. WARNER.


order to have bimetallism it is necessary
for everybody to have a gold coin in one
pocket and a silver coin in the other.
Even men who are supposed to be well
assert that the restoration of
the free coinage of silver would at once
gold; and some have even
gone so far as to assert that the first mint
act, that of 1902. which provided for the
free coinage of both gold and silver, did
gold, because this act fixed
the ratio at Is of silver to l of gold, while
he European ratio at that time was
l53 to l; and that in 1884, when
the ratio was changed to 16 to 1, silver
was then demonetized. Notwithstanding |
the manifest ~misconception of the real
truth pertaining to these early acts of
Congress, many are misled by such state
ments. The truth however, is, that the
act of 1902 clearly and Enthusiastically es-
tablished the double standard, or stand.
ard OF the two metals. 1t carried out
exactly the declaration of Jefferson That
the unit must stand on both metals"
In what does resting the money unit on
both metals consist? Simply in the legal
right to have either metal converted into
money units, at specified weights, for the
coin of each metal. AS long as the right
exists to have either or both metals coined
at tho minis without restriction, the unit
rests On both metals, whether both are
taken to the mints in equal proportion or
whether but one for the time being, is
resorted to. That metal, under such con-
ditions, will be coined which can be most
easily procured.
Neither does bimetallism REQUIRE that
the coins of both metals shall circulate
side by side in equal quantities, or be
convertible n into the other. But bime-
tallism does require that the money unit
shall stand on both netals-that is, that
the right to take either metal to the mint,
there to be coined into legal-tender
money, shall not be restricted. That is
the condition that prevailed in this
country from the foundation of the Cover
ment down to 1878, and was the condi-
tion that practically existed for indefinite
ages throughout the civilized world. 1t is
true that under the act of 1892, establish
ing the mint, gold was rated lower as
compared with silver and silver higher as
compared with gold thar the French ratio
which then controlled the rate at which
the metals were exchanged in nearly all
commercial countries. That is, in the
United States it took but fifteen pounds
of silver to get a pound of gold or to pay
as much debt as a pound of gold would
pay; consequently, when other countries
had balances to pay to the United States,
they sent silver instead of gold, and for
like reasons, if merchants here had bal
ances to pay abroad, they sent gold in
stead of silver, because a pound of gold
there would go as far az fifteen and one
half pounds of silver, while here a pound
of gold would go no farther than fifteen
pounds of silver. 1t was only in this way
that gold at that period went abroad in
stead of silver. The coins of both metals.
however, circulated here except when
both were expelled, as frequently hap
pened, by over issues of bank paper
money, but with the tendency all the time
for gold to leave US.
In 1884, this condition was reversed
by changing the ratio in this country
from Is to l to a ratio of 16 to /. After
this change it took 16 pounds CT silver
here to equal one pound of gold, while in
Europe it still took but 15!, Consequent
ly when balances were to be paid abroad,
silver was used instead of gold. The ten
dency therefore was for gold to stay here
and for silver to be sent abroad. In ex-
porting coins of either metal full weight
coins are always selected. and hence most
of the silver coins that circulated here
we're the lighter foreign coins, and as
foreign coins were legal tender in this
country down to 1857, the silver ~circula.
ton consisted mostly of such coins, u.s.
ually reduced in weight by wear, while
the new coins of our own mintage wonld
, be selected for export. Hence it was that
not many silver dollar pieces were coined
during this period. Foreign coins were
used instead. 1t often happened, however,
that the coins of both metals were almost
entirely expelled from circulation by over
issues of banks notes.
The material point in all this is that it
made no difference whatever whether
both metals circulated in this country in
even proportion or in any proportion.
The right all the time existed to convert
either into money. What difference did
it make with prices or with trade whether
our circulation consisted half and half of
both metals, and the circulation of France
half and half of both, or ours of more sill
yer at one time and of more gold at
another, while the circulation of France
changed the other way, more gold when
we had more silver and more silver when
we had more gold ? The important fact,
and the only fact of Importance, is that
both metals, without restriction, could all
this time be converted into money and all
there was of both constituted the monsy
of the world, and together, constituted
the standard of value for all countries.
Bimetallism consists, therefore, in legal
right to convert either metal into money
without restriction, and where this right
exists the unit stands on both metals, and
to claim that either metal is then demone-
tized is to claim what is 30 manifestly not
true that it ought not to deceive anyone
AS long as the right exists to convert
either metal into money, in whatever pro-
portion the two metals may circulate in
this country, both metals will be potent
ally money, and will circulate somewhere,
and both together, and not one alone, will
determine prices and constitute the stand
ard of value for the world.
If it required an annual outlay of 800
to insure a family against any serious
consequences from an attack of bowel
complaint during the year there are many
who would feel it their duty to pay it;
that they could not afford to risk their
lives, and those of their family for such
an amount. Any one can get this insur
ance for % cents, that being the price of