The Jasper weekly courier. [volume] (Jasper, Ind.) 1858-1922, 1897-05-21
The Deficit as q Blessing.

The Journal felicitates itself that
liz has found a flaw in Mr.. Bryan's
logic. That gentleman's unanswer.
able reply to Mr.. Dingley contains
the following paragraph:
"Instead of being an injury, the
deficit was during that period a
benefit, because the money which
accumulated from the sale of bonds
could not have returned into the
channels of commerce but for the
deficit. If, as is probable, the
gold would have been drawn out,
even if the revenues of the govern
ment had equaled its expenses,
then that money would have been
held in the treasury and business
would have been crippled more than
it was"
The Journal, after characteristic
misinterpretation, assumes this to
be defense of the proposition that
at all times and under all circum-
stances treasury deficit is ma
tional blessing. "During that per-
iod"-the time of the heavy with
drawals of gold for expectation, the
retention in the treasury OF the
notes exchanged for gold would
have been an additional contrac-
ton of the volume of money in cir
culation, and if a surplus had ex-
istel the notes thus received GER
tainIy would have been thus laid
aside. A deficiency in the revenue
made it necessary to pay them out,
thus relieving to that extent the
money famine of the country. This
does not seem so abstruse that even
the Journal ought to be excused fol
being unable to grasp it. Moreover
republicans never tire with saying
that surplus will stop the with
drawals of gold by making it pos
sible for the secretary of the treas
ury to refuse to pay out notes once
exchanged for gold, thus leaving
nothing outstanding for redemp-
ton. Thus is made apparent the
advantages of an abundant revenue
as a means OF retiring green.
backs" The evils resulting from
the locking up of money "durinl
that period" in which the deficit
was referred to as a benefit rather
than an injury by Mr.. Bryan were
graphically portrayed by Gen
Francis A. Walker in a paper read
before the American economic asso-
citation and published in the Quar-
terly Journal of Economics, Oct.
1893. Gen. Walker said:
"When the present paper was
placed upon the program of the
association little thought that in
defending my thesis (the value Of
money! l should enjoy the advan-
tage of such a tremendous, such an
overwhelming demonstration of the
Importance of the actual money of
a country, in the face of the most
elaborate organization of credit, as
the United States has afforded dur.
ing the past two months. Sir John
Lubbock's bank, and the half per
cent. cash payments in the clearing
house, cut very small and sorry
figure, indeed, in comparison with
the spectacle which has been af-
forded of a great nation on the
verge of general insolvency, thous-
ands of factories and workshops
closed, hundreds OF thousands Of
workmen thrown out of employ
ment, all because a certain amount
of cash, of actual money, had been
locked up in strong boxes and
banks vaults. When one considers
what this great industrial nation
has passed through within the last
sixty days because a portion only
Of its money had been withdrawn,
he is fairly in position to appre-
ciate the senselessness of all this
talk about the unimportance Of
The money supply. Until we have
forgotten how we saw the banks of
The commercial and financial me
Lropolis refuse to pay their balances
10 other cities in cash on demand:
how we saw great and rich firms
paying their workmen in checks Of
B2, SO, and $5, and these checks
not payable at the bank but stamp
ID Payable only at the clearing
until we have forgotten how
We saw great factories carrying on
heir business timidly from day to
lay, not with money and not with
proper commercial credit, but upon
he frail foundation Of sympathy
and forbearance from their creditors
and even from their operatives,
while thousands Of other manufac-
.urers refused to carry on business
At all under such conditions, and
closed their works-until we for
get these universal experiences Of