The record-union., 1897-12-18
Resumes His Explanation Of His E1'
tensive Monetary Bill
Before the House Committee on BANKING
and Currency.
Gives His Version of What BIZ
metallism Means-States That
His Measure in No Way Perju-
dices Any Steps Which Might
be Taken to Bring Silver Up
to a Higher Standard Of Value.

to a Higher StanQAT0 VI "A'
WASHINGTON, Dec. 17.-Secretary
Gage resumed his exposition OF his eX-
tensive currency bin before the House
Committee on Banking and currency
to-day. Chairman Walker had left the
city and Brossius Of Pennsylvania pre-
sided.
Before the bill proper was taken UP
some semi-political questions Were
asked. Hill CR.) of Connecticut cameo
Mr.. Cages attention to the statement
made yesterday that the hrst purpose
of the bill was to commit the country
to the gold standard.
you are recognized as a Repuon-
can" said Hill, addressing the oecle-
tary, "and you are familiar Win the
financial platform of the Repupncah
national convention at ST. Louis Do
YOU consider that this purpose OF more
firmly fixing the gold standard on tiie
country conflicts with the plank Oh tue
ST. Louis platform 2?
s.No. sir" responded Mr.. Gage, mot
as l look at the question OF olihelai
lism. Bimetallsm must mean one Vi
two things: Either it is two klHus VI
money of unequal value circulating sue
by side by reason of the exchange OF
the less valuable for that of the greater
value. or else two kinds of money OF
such intrinsic equality OF value tnat
they will circulate naturally slde py
side We have a bimetallic currency III
the United States now. A frm estao-
lishment of the gold standard, Win
such interchangeability with silver as
will make il acceptable on an equailty
with gold. will maintain this blmetal-
lism the same as it has existed Tor the
last eighteen years"
The Secretary went on to state that
this in no way prejudiced any steps
that might be taken to bring silver up
TO higher standard of value. Inc DILL
however. was designed to give such
confidence in the financial stability OF
the Government that the discrlmlna-
lions against silver would be largely de-
creased.
Cox ODD of Tennessee asked If the
result of the Gage bill eventually would
not lead to one kind of paper money
hank notes-and no silver. except sub
sidiary silver.
.aThere is nothing in this plan TO CO.
operate to that extent now" answered
Mr.. Gage. ct is in that direction, ana
with further explanation developing IL
might ultimately lead to such result
But I would not say that silver VIII pe
restricted to subsidiary silver. L would
saw such system Of silver which
would be subordinate. 1t is subordl-
nate now"
After this diversion to the silver
question the consideration of the Dill
by sections was resumed at section 1,
where the discussion closed yesterday.
This section provided for an increase or
national bank note circulation to be Sc
cured. not by the deposit of bonds or
notes. but by the assets of the bank ana
the Government guaranty. Mr. Gage
referred to the advantage OF this addl-
tional unsecured circulation, in giving
elasticity to the currency at points
where it was most needed. He showed
from the returns Of the Comptrollers
that a small percentage of losses came
from national banks. and further than
this unsecured circulation would fail in
any considerable obligation to the Gov
ernnent by reason of its guaranty, ana
this would be overcome by the small
tax on the bank constituting safety
fund.
In answer to questions by Newlands
of Nevada the Secretary said that the
amount Of refunding bonds under the
hin would reach 81 1856 100000 If all or
them were issued. This being the
basis for circulation, bank notes could
be issued to that amount. Besides
these the additional % per cent. or un-
secured circulation would give furth-
er issue OF bank notes of about S3oO.-
600 600 But that vast issue was mere
~ the creation of specter. ana was
NOT a reality. The banks could not get
all the bonds and use them for issuing
hank notes. on the contrary. Govern
ment bonds are always taken largely
bv private investors, trust companies
insurance companies and parties across
the water Any effort of the banks 10
absorb all the bonds would so aHect
the prices as to defeat the ooJects IN
view. This also would serve as sinaii
check to the expansion Of bank clrcula-
tion.
Newlands referred to gold con-
tracts" and asked the Secretary aoou'
them MIR. Gage did not deem it de-
sirable to interfere with private con-
tracts of this character any more than
was necessary. To Prince OF Illinois
ne explained that his expression gold
anu olilcI itSdi illblfCs NStN ~ 49, "
meant no reflection on silver or other
classes OF money. The other legal mon
ey included silver, and the expression
merely served to cover well under-
stood term. The extent to which drains
on the Government stock Of gold would
result under the plans of the bill ex-
cited much discussion
Mr.. Gage stated that all redemptions
would be made in gold or it's equivalent.
Fowler OF New Jersey said this opened
serious question, and inquired If sii-
yer certificates would not be deposited
and impounded and their place taken
by national bank notes. thus increasing
the decline in our gold supply. Mr..
Gage answered that il was easy to con-
lecture up hypothetical objections. but
he did not look at this case as serious.
Any Secretary Of the Treasury on re-
cefving these certificates would swap
them for greenhack treasury notes and
other form of Government notes. which
served TO drain gold and thus build up
the redemption fund
Regarding Section 8. which pledges
the faith OF the United States to the
redemption OF bank notes. MIR. Gage