The National tribune., 1897-12-09
THE PRESIDENTS MESSAGE.
The Constitutional Review of Public Affairs Submitted to the
q. Peoples Representatives.
Currency Moderate Course rrued Tv
SpainThe Annexation Of Hawaii
ded-Varous Topics Of National Moment

The President begins the document by
| felicitating Congress upon the prosperity
| which has come to the country and also
upon the disappearance of the spirit of
sectionalism.
He proceeds Immediately to the considera-
ton of the currency question, and says:
THE CURRENCY QUESTION.
The work of putting our finances upon a
sound basis, difficult as it may SEEM will
appear easier when we recall the financial
operations of the Government since 1866.
On the 30th day of June of that year we had
outstanding demand liabilities in the sum
of SIPS, 1868, AL. Al. On the 1st of January
1879, these liabilities had been reduced to
Sf43, S89, 1883 OF our Understanding OBJ
legations, the figures are even more strlk-
ing. On July /, 1866, the principal OF the
Understanding debt of the Government
was 81, 1872, 331 POS. On the list day OF July,
1898, this sum had been reduced to $3.50, OBJ
100, or an aggregate reduction OF 81 TAI ,294,-
10S The Understanding debt OF the
United States on the first day of December,
1897, was SS47 ,365, $50. The Government
money now outstanding dec. II consists
of S346, 6Si ,016 of United States notes, S107,-
1893 280 of Treasury notes issued by author
ity of the law of 1890, 1891 1863, sol OF silver
silver dollars. a.
With the great resources of the Govern
ment and with the honorable example OF
the past before us, we ought not to hesI-
tate to enter upon currency revision winch
will make our demand obligations less
onerous to the Government and relieve our
financial laws from ambiguity and doubt.
The brief review of what was accom-
rIished from the close OF the war to 1893,
makes unreasonable and grOundleSS any
distrust either of our financial ability or
soundness; while the situation from 1893 to
L.
date necessity of SO lcgislatine as 10 make
the return to the conditions then prevailing
impossible
There are many plans proposed as a rem
edy for the evil. Before we can find the
true remedy we must appreciate the real
evil. 1t is not that our currency OF every
kind is not good, for every dollar OF it is
good good because the Governments
pledge is out to keep it so, and that pledge
will not be broken. However. the guaranty
of our purpose to keep the pledge will be
best shown by advancing toward it's fulfill
ment.
EVIL OF THE PRESENT SYSTEM.
The evil of the present system is found
in the great cost to the Government of
maintaining the parity of our different
forms of money, that is, keeping all OF
them at par with gold. We surely cannot
be longer needless of the burden this I'M
poses upon the people, even under fairiy
prosperous conditions, while the past four
years have demonstrated that it is not only
an expensive charge upon the Government
but a dangerous menace to the National
credit.
1t is manifest that we must devise some
plan 10 protect the Government against
bond issues for repeated redemptions. We
must either curtail the opportunity Tor
speculation, made easy by the multiplied
redemptions Of our demand obligations, or
increase the gold reserve for their redemp-
ton. We have $500 600 OF currency
which the Government by solemn enact
ment has undertaken TO keep at par with
gold Nobody is obliged to redeem in gold
but the Government. The banks are not
required TO redeem in gold The Govern
ment is obliged to keep equal with gold
all its outstanding currency and com obh-
cations, while its receipts are not required
to be paid in gold! They are paid in every
kind of money but gold. and the only means
by which the Government can with GER
tainty get gold is by borrowing. 1t can get
it in no other way when it most needs 1T:
The Government without any fixed gold
revenue is pledged to maintain gold re-
demption, which it has steadily and faith
fully done and which under the authority
now given it will continue TO do
The law which requires the Government
after having redeemed its United States
notes to pay them out again as current
funds demands a constant replenishment
of the gold reserve. This is especially
so in times OF business panic and when
the revenues are insufficient to meet the
expenses OF the Government AT such
times the Government has no other way
to supply it's deficit and maintain redemp-
ton but through the increase of its bonded
debt as during the Administration of my
predecessor when S2G2 ,315 400 OF four and-a
half per cent. bonds were issued and sold
and the proceeds used to pay the expenses
Of the Government in excess OF the Teve-
| a. 10
il is true that the greater part OF the pro
ceedS OF these bonds were used to supply
deficient revenues, a considerable portion
was required to maintain the gold reserve.
With our revenues equal to our expenses
there would be no deficit requiring the is
suance OF bonds. But if the gold reserve
| falls below S100 coo GEO, how will it be re-
pIenished except by selling more bonds?
| Is there any other way practicable under
existing law? The serious question then
| is, shall we continue the policy that has
| been pursued in the past; that is, when
| the gold reserve reaches the point OF
danger, issue more bonds and supply the
needed gold or shall we provide other
means to prevent these recurring drains
upon the gold reserve? If no further legis-
| lation is had and the policy of selling
| bonds is to he continued, then Congress
should give the Secretary of the Treasury
authority to sell bonds at long or short
| periods, bearing less rate OF interest than
| is now authorized by law.
| WHAT IS RECOMMENDED.
| / earnestly recommend as soon as the
receipts of the Government are quite Suffi-
| cient to pay all the expenses of the Gov
! eminent, that when any Of the United
| States notes are presented Tor redemption
| in gold and are redeemed in gold, such
notes shall be kept and set apart, and only
| paid out in exchange Tor gold. This is
an obvious duty. Ii the holder of the
! United States note, prefers the gold and
| receive back from the Government Il United
| States note without paying gold in ex-
| change for it. The reason for this is made
| all the more apparent when the Govern
| ment issues an Understanding debt to
provide geld for the redemption of United
| States notes. non Understanding debt.
! Surely it should not pay them out again
| except on demand and for gold. If they
are put out in any other way, they may
return again to be followed by another
| bond issue to redeem them-anOther inter
! est-bearing debt to redeem a non-interest-
| bearing debt. Il
In my view it is OF the utmost import
ance that the Government should be re-
lieyed from the burden of providing all the
gold required for exchanges and export.
| This responsibility is alone horne by the
| Government, without any of the usual and
| necessary banking powers to help itself.
| The banks do not feel the strain of gold
redemption. The whole strain rests upon
| the Government, and the size of the gold