Reporter and farmer. [volume] (Webster, Day County, Dakota [S.D.]) 188?-1946, 1896-05-14

To say nothing Of tho gross partiality and
manifest injustice of such a policy, It's Imme-
diat6 effect would be to contract our currency
TO the extent of about SG&0,O0O,0 900 by stopping
the use of gold as money ana putting a pre-
MUM upon TIE coins of that metal equal, or
about equal, TO the difference between the IN
trinsic value OF the gold dollar and the intrin.
sic value of the silver dollar. Gold coins would
at once become "a commodity and would be
bought and sold by spectators in the market
just Us they were during the war, when We
had "A deprecated paper currency. The value
of the silver dollar would f~uctuate from day
to day, moving up and down with the rise and
fall of the commercial price of the bullion con-
tanned in it, as the Mexican dollar does now,
and the premium on the gold dollar would OF
course fuctuate to the same extent, thus af-
fording an opportunity to bullion brokers and
Spectators to buy and sell it at a profit. II
would cease to be used as money, because no
man would pay his debt in gold dollars or in
paper redeemable In gold dollars, worth 100
cents, when the law permitted him to pay it
In silver dollars, worth only 81 or 81 cents.
The sudden withdrawal of $500, 600. 600 from the
volume of currency in the country would I'M
doubtedly produce a 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 for working men and women and
their dependent families can contemplate the
possibility os such a calamity without feeling
that it is his duty, whether he occupies u pub
lie or a private station, to employ every hon
orable means at his omman to avert IL.
! While the sudden expulsion of $500, 900, 900 in
gold from our stock OF money would itself be
sufficient to create a financial disturbance TN
paralleled 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 one-half;
we should have only about two-thirds as much
currency as we have now, and at the same time
it would be so deprecated in value that it
would require about twice as much as we have
now to transact the business of the country,
provided there should be any business to
transact.
Double Standard q Failure.
The attempt to maintain what is called the
double standard of value-that il, to attempt
to keep the legal tender coins Of the two met
ais, gold and silver, in use as money at the
same time, upon q ratio of value fixed by law
has repeatedly been made by kings and par
liaments in every civilized country in the
world, and it has failed again and again in
every one of them, and it requires no gift of
prophecy to foresee that it must continue to
fail SO long as self interest constitutes n con-
trolling factor in the business affairs of men.
NbI NANPA'SNAsS NIgAA DAA w
review the monetary history Of other coun-
tries in which this experiment has been made
and failed it may be advantageous to refer
briefly to our own experience upon this sub
iect. When it was determined to adopt a
monetary system for the United States and
establish a mint, Alexander Hamilton and
Thomas Jefferson, two men who differed
widely upon almost every public question and
whose names as founders and leaders of their
respective parties will live as long as our POI
litical literature is read, agreed that in deter
mining what should be the coinage or legal ra-
ito between gold and silver the true relative
commercial value of the two metals in the
markets of the world must first be aScert&ined,
and that this relative value, when ascertained,
should be incorporated into the statute as the
basis Of the proposed system Of coinage. AL
though they were party leaders, they were
statesmen and patriots, and when they were
called on to consider this great business Ques-
ton affecting all the private affairs of their
fellow citizens they gave it a thorough and
impartial investigation upon its merits, with
out regard to the effect their decision might
have upon their own political fortunes or
upon the political fortunes of their followe
The Fathers Not Disturbed by Thu De-
fusion.
These great men were never disturbed for a
moment by the delusion that congress could
fix by statute tho actual or relative values Of
| gold and silver any more than 1t could fix by
statute the actual or relative values of a pound
of lead and u pound of iron. They knew that
| gold and silver, like all other exchangeable
, things, are commodities and that their value
will be fixed in the markets CO the world.
They knew that 1t was entirely competent, in
fact necessary, for congress to declare the ra-
ito upon which the two metals should be coined
at the mint, If they were to be coined at all,
but they knew equally well that II the ratio so
declared did not correspond substantially with
4 A. a, xl.Al ALA 49, ~ xwyn~l1 AL 40
tablished, the coins of the two metals could
not be kept in use as money at the same time.
and consequently, as i have already said, they
determined to ascertain the commercial ratio
and to adopt it. They reached the conclusion
that the true commercial ratio at that time
was 10 to THAT is, that 10 ounces of silver
were equal in value to l ounce of gold and
accordingly the act of 1902, 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 37l14 grains of fine silver and
the gold contained 2iA grains of fine gold, but
it was soon discovered that a mistake had been
made and that 31l14 grains of fine silver were
not in fact equal in value to 24A grains Of fine
gold, and the consequence was that, although
the difference between the value Of a silver
dollar and the value of a gold dollar was only
about one cent and one-eighth OF a cent, silver
drove gold out of use and out Of the country,
and from that time we had silver monometal-
lism until after the passage Of the acts Of 1884
and 1857.
The fact that the silver was put into the
form of a coin and made legal tender the same
as gold, and that both dollars were declared
to be worth 100 cents each, did not increase
the value of the 31l4 grains of silver to any
extent whatever. The people could not be de-
ceived by mere words printed in a statute;
they soon leaned that the metal contained
in the silver dollar was not equal in value
to the metal contained in the gold dollar
and they paid silver to their creditors and
boarded the 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 as they were generally
SO worn by abrasion AS to be of less weight
than the new domestic coins they drove our
dollars and half dollars, and to a large extent
I our quarters and dimes also, out Of use az
money. Our own coins were exported and used
at their 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, 1906 stopping the coinage of silver
dollars at our minis. No more silver dollars
were coined until 1885. 80 years afterward, and
then only 1000 of them were issued from the
mints.
Restoration of Gold Standard In 183A.