The Pacific commercial advertiser. [volume] (Honolulu, Hawaiian Islands) 1885-1921, 1896-10-09
OCTOBER 9
DAVID WELLS on GOLD APPRE-
CATION.

In a late issue of the New York Trib-
une, David A. Wells sets forth TO con
siderable length his views upon the
financial systems Of the world and more
especially does he devote his attention
to the arguments of the free silver men
who are at present the center of inter
est in the commercial and agricultural
centers of the world. One of the most
interesting features of Mr.. Wells arti-
Gle is that portion in which he touches
upon the theory that gold has appre-
ciated in value. The argument is a
common one that the price of commo-
dities follows the price of silver and
Furthermore that the reason why a gold
dollar will today buy more than it did
several years ago is because the gold
has appreciated in value. But as Mr..
Wells says no one has ever been able
TO name a single commodity that has
notably declined in price within the
last thirty years, and satisfactorily
proved or attempted to prove, that such
decline was due to the appreciation of
gold.
In further exposition of the question
he says: THE following question, put
by Professor Lexis, the German econo-
mist, TO those who contend that there
has been an appreciation in the intrin-
sic value of money, has, furthermore,
never been answered, namely: How
is it possible that the United States,
which from 1878 to 1893 issued more
silver money or silver-covered notes
than all the countries of Europe had
issued in a like period previous to 1893;
that coins annually and mainly from
the product of its own mines a large
amount of gold-$43 ,933, 900 in 1895;
that maintains a circulation of $436,-
900, 900 of legal tenders (greenbacks),
issued for the purpose of collecting
forced loan for the prosecution of the
war; that especially and artificially reg
ulates the price in it's own markets of
not few of the great commodities of
the world by a tariff-how has it been
possible that the United States, with
de facto double standard and it's excess
of media of circulation, has experienced
as great or greater depreciation of
prices than is alleged to have taken
place in Europe by a maintenance of
the gold standard? Is it not plain that
a phenomenal decline of prices in two
parts of the world, with entirely differ
ent monetary conditions, must have
had other cause than a characterization
of silver in the United States, which
took place Gf it ever did compare
lively short time ago (repeal of the
Sherman act in 1880, and which has
not prevented nearly $500, 900, 900 of sill
yer credit money from circulation in
the country at it's full nominal value?
THAT the price of labor measured in
gold has not declined, but increased in
a marked degree everywhere in The
civilized world during the last quarter
of century, has been already COM
mented on. Hence, if the purchasing
power of gold has increased during this
period, a given amount of it would have
purchased more labor and not less; or,
what is the same thing, wages would
have fallen. which they have not done.
Measured by the price of labor. gold
has unquestionably deprecated; and
recent careful examinations indicate
that the ratio of its decline has been
from 100 in 1873 to SO IN 1898 Measur-
ed also by the decline in the rate of in
terest on such established gold-paying
securities as British consols, the ratio
has been from 100 in 1870 to rs in 1896.
Can anybody suggest better measure
for testing this issue?
g Has any one ever. endeavored to eX-
plain how an appreciation of gold has
reduced the cost of railroad and water
transportation to the extent of more
than IS per cent. within the last twenty
years, although the wages of employees
have notably advanced during the same
period? If, on the other hand, these |
reductions were caused by the suppress |
sion of the free coinage of silver, will |
not a reversion of policy enable the
railroads to advance their freight rates |
and rob the people, as will be claimed, |
by exacting so per cent. more than at |
present? And will not some supple |
mentary provisions to the free-ccinage |
act be necessary to prevent their so
doing?"