The daily morning journal and courier. [volume] (New Haven, Conn.) 1894-1907, 1896-03-31

trade, Its only Justification at the
time was It's supposed actual necessity,
and it was only on that ground that the
supreme bench first denied, but having
been partially reconstructed, finally up
held the constitutionality of the law by
a divided court. But the mischief was
done, The court declared that a gov
eminent promise to pay money~~prop-
erty-was itself money, If congress only
ordered 1t to be received as such In dis
charge of debt. A political party was
built on the idea that that power con-
ferred to discharge a debt by eompul-
sion of the creditor was OF the final es-
sence Of value, The political and judi
cial history of this matter is one of the
most singular in our annals. l regret
that time forbids its review.
1t was, therefore, effectively decreed
that every creditor should be compelled
to receive as a dollar the governments
promise to pay dollar, although the
promise might at the time be worth
only thirty-seven cents In the market.
Whereat, some innocently, because ig-
norantly. but others with political ends,
and others yet, with personal profit in
view, assumed that the arbitrary and
compulsory debt-paying power of the
paper promise of dollar made it really
a dollar with full standing In the mar
ket, although that paper promise, while
it would pay off an hundred cents
worth of debt because the creditor
couldn't help himself, could only buy
in the market thirty seven cents worth
of flour. That one fact ought to have
made the whole absurdity clear; and 1t
did, for men who took the trouble to see
all the facts and to think and to re-
member the moral law. But the dena-
gogue assumed that every debtor want
ed to pay his debt in poorer money
than he got in contracting 1t; the spec
ulator saw his chance for fish in
troubled waters and they raised the
cry for a cheap money costing nothing
but the printing to produce, and Just
as good as any other for all purposes,
because, forsooth, 1t had the faith of
the nation behind it, and could, by
compulsion Of law pay debts; and
everybody was in debt, and therefore
this was the money of the people. And
so, the court having ruled that congress
could make a paper promise of dollar
a. good enough dollar to pay debts with.
no matter how poor q dollar it might
be to buy bread with, the compulsory
debt-paying quality, and not the bread
buying quality, became the sign and
true token of the peoples money.
But the false ideas involved in the
creation and subsequent legislative and
judicial treatment of the greenback
debt, and thereby fostered in the minds
of the people, have by no means disap-
peared. There is probably no longer a
serious danger of the recrudescence of
greenbackism as such; at least to any
controlling extent. But It's whole outfit
of ideas and arguments and its whole
corps OF champions have been trans
ferred to the sixteen to one, free silver
coinage camp.
Bank Notes.
The problem respecting our national
bank circulation t$213, 900 000), which
serves most admirably the purposes of
a commercial currency for domestic
use only, grows out of it's limited life,
based as 1t is upon the security of
bonds which must mature and be paid.
AS this takes place, this form OF cur
rency must disappear, unless some
other basis of security be provided. Its
stability and its complete acceptability
throughout the United States make 1t
a commercial necessity that it should
be in some way preserved for domestic
use; and all the more, that, with a re-
turn to sound principles, the disappear
ance of the greenback will have a large
space to be filled by legitimate COM
nercial credit currency.
It Is not to be expected or desired
that the government should maintain
debt and pay interest on it, for the
sole purpose of basing such currency.
Nor is it in the least necessary, even to
the maintenance Of a bank currency of
equal quality in every respect with the
present one. Bank currency, a true
credit currency, represents, and Is the
outgrowth Of commercial credits, based
upon the vast daily exchanges Of prop
erty which are effected through the
intervention of banks and their opera
tions. Those credits representing the
commercial wealth of the whole coun-
try, form the strongest possible basis
for a credit, bank currency, provided
they be properly secured to the support
Of that currency. Experience elsewhere
shows this to be entirely feasible and
wholly satisfactory; with the added
advantage over the present system of
being the cheapest method that can be
devised. It's administration should, of
course be under strict government in
spection and control Such a currency
is elastic, expanding when expanding
trade requires it, representing as 1t does
the actual transactions of trade, and
contracting when trade contracts and
it's balances have been settled, thus
avoiding the evils of O. redundant cur
rency; a quality not possessed by a
currency based on bonds which do not
expand or contract, and which pay in
terest, and which cannot be directly
used in the redemption of the bank
notes predicated upon them.
lens of the government, but as a most
important item in our actual, effective
currency mention at least must be made
of the whole enormous system of pri-
vate credit currency known as the bank
cheque. The total amount of deposits,
including money deposits, in the ma
tional, states private and other banks
and trust companies, is nearly $1,000
0000 900, all available to commerce both
large and small. through this same
bank cheque. 1t is fast becoming to re-
tail trade what the bill of exchange
is n fhp wholesale and fo,liuy1 do