Kansas agitator. [volume] (Garnett, Kan.) 1890-1905, 1897-02-26
FINANCIAL HISTORY.
A GLIMPSE AT CONGRESSIONAL
LEGISLATION SINCE 1850.
An Open Letter Co Lyman .. Gage
McKinley's Secretary OF the Treasury
"A Cool Statement OF Facts That Are
Written in the Laws of Our Country.

To Lyman ]. Gage:
In few days you will assume the
high Office of secretary of the treasury.
While l am radically opposed to the
financial views which you are said to
hold, yet / am conscious Of the fact,
that unlike most men who have to do
with banks, you are not opposed 10
reasoning with the advocates OF the
other side. Therefore feel at liberty
to make an argument in behalf OF a
liberal use of silver as money OF re-
demption during your administration.
You know what the condition OF the
country Is today. You know that
prosperity is not coming. You know
that high tariff alone cannot prlng
prosperity among the people. you
know that an increase in the volume
of money is the one thing that Is
necessary to a restoration OF prosper
ity. You know that such an increase
would have tendency to cheaper all
other money, and that holders OF the
latter would speedily invest their hoid-
ing to catch the resultant rise In prices
of labor's products. So far as the
necessity of an increase in the volume
of money is concerned gold and silver
men agree. But as to the means they
are at wide variance. The gold men
believe that the increase should come
through the national banks. The Dl-
metallists contend that it should coHie
through the government by free ana
unlimited coinage Of silver and govern
ment paper. Within the limits OF your
administration a move in one direction
or the other will have to be taken.
Which is the better plan? Let us
take brief glance at our financiai
legislation since 1860.
Let it be remembered, and never
be forgotten, that when the war OF the
last rebellion broke out in 1861, the
treasury was left empty. The bank
ers of that day came forward and Oh
fered to furnish the government all
the money it wanted, i. e., OF its state
bank notes, and take government
bonds at 80 cents on the dollar In ex-
change for these notes.
Salmon P. Chase, the secretary OF
the treasury, thought the government
of all the people would be better than
any bankers bank notes, who had
not one dollar in coin back OF every
ten, and in many cases twenty paper
promises to pay, which they put out,
so congress passed an act, Aug. B, 1861,
to issue s5O,0O0,00O demand notes.
which were paid to soldiers, officers,
etc.
The bankers, however, would take
them for only 80 cents on the dollar,
as they lacked the legal tender quality
of money.
Congress, act of Feb. IL, 1862, issued
another $1O,OOO,OOO, and likewise $780,
$1,000 to take up the $5O,000000 al
ready issued without the legal tender
quality of money, and called in the
first issue of demand notes. This six
ty million never deprecated one cent
after being made a full legal tender
by act of March II, 1862, but soon dis
appeared from circulation just as did
all the metal money. This money
lasted but a few days. Congress was
about to issue another batch Of $780,
100000, and that greatly alarmed the
bankers, for they saw that their craft
was in danger. They dispatched their
most polished lobbyists to Washing
ton to advise the members of congress
what was best to do in case Of issuing
paper money, as they called 1t.
Then the house of representatives
passed an act to issue $150,000,00 of
the same kind of legal tender paper
money, making it legal tender for all
debts public and private; while Mr..
Belmont and others were laboring with
the senate, saying that they would
have to issue bonds and that Mr.. Bel
mont had been authorized to say that
Baron Rothschild would take three
or four hundred millions of our bonds
if they would make the interest payable
in coin.
Salmon P. Chase Remarked: How
could we pay the interest in coin, the
treasury is empty Of coin, and likely
to be?"
THAT is a very easy matter" re-
marked Belmont; make your import
duties payable in coin, then you will
have the coin come in the treasury
with which to pay the interest. You
cannot expect Rothschild of England to
take your paper money for the interest
when it is only another promise to
pay"
The house bill provided for the issue
of $15O,OOO,OOO of pure, absolute, consti-
tutional money, with the fiat of gov
eminent upon paper-which is just as
good as upon metal if the people have
confidence in the stability of their
government and have the taxing au-
thority to tax the money back into the
treasury which issued it.
It should be impressed upon every
intelligent mind that the material upon
which the fiat stamp of the government
Is impressed, does not change the rep
value Of the dollar. 1t
Is the number OF dollars in circulation
hat gives it high or low purchasing