The Dalles times-mountaineer. [volume] (The Dalles, Or.) 1882-1904, 1897-07-31
VALUE AND LEGISLATION.

which they were intended.-Ex.
VALUE AND LEGISLATION.
The contention of the advocate o
silver with regard to the decrease in
price thereof has ever been that it wa:
the result of a lessening in the demand
brought about by the demonetizatior
of the metal by leading nations during
the early 7O's, and they have as per
sistently contended that a remoneti
zation of the metal, even by single
nation of such commercial impor, anct
| as the United States, would create sucl
a-d -damand fer it as to raise the price
Both these contentious have beer
streneously denied by the gold press
but at last the Oregonian, which car
see nothing good in any metal excep
gold, acknowledges that the de
monetization of silver was one of tht
causes of its decline in price. In s
recent editorial it says:
"The price of silver rose with Other
prices after 1859. until it was pressed
down. in way perfectly easy to under
stand, by enormously increased supply
through vast new production and sim
ultaneous decrease of demand, through
the abandonment of silver as money
standard by one great commercial
nation after another. The point to
be insisted upon now is that this fall
in the price of silver was fastened by
increased production OF gold, and that
new additions to the worlds stock OF
gold will only press it lower. 70 state
the principle in general terms, in
crease in the supply of either or both
of two money metals diminishes the
demand for that which is less efficient,
desirable and convenient by supplying
many who have had to employ it with
that which all would prefer, were there
enough to supply all with it. This ef-
feet is so much more prompt and
powerful than that of the quantative
proportion of gold on general prices
that, if stimulating effect of in
creased production of gold on general
prices were perceptible, silver would
be an exception to the general rule.
"Silver and gold may be conceived
as two kinds of machines for making
exchanges, an inferior and a superior,
whose relative value depends upon the
worlds demand fer each. for that and
other purposes. 1t is understood how
the value of the inferior machines is
lessened by increasing the supply.
The value of the superior machines
would not be decreased so fast by in
crease of supply, because those who
were using the inferior machines
would throw them aside and take the
superior, until that alone was in use.
This is what the nations, from Ger
many to Peru, have been doing with
gold and silver for a quarter of GEN.
tury. The obvious effect of this SUBJ
stitution is to decrease the demand for
and diminish the relative value of the
inferior machines with every increase
in the supply of the superior.
While much of the above argument
is we'll made and true, it docs not go far
enough into the real merits of the
question to give clear idea of present
conditions with refer ence to silver.
The only reason why silver is. today
the poorer machine for effecting ex-
change is that it is not recognized as a
standard money. This Office was taken
away from it, consequently the demand
was diminished and the price fell.
Without Legislation, or more plainly
speaking, had it not been deprived of
money power, the demand would have
remained great and the price would
bave kept apace with gold at the estab-
ished ratio prior to 1873.
Then if the demand for silver was
.essened By legislation, is it not true
that it can be increased by legislation?
Aud if value was legislated out Of sill
yer by cutting off the demand, can
value not be legislated back into it by
the demand? The argu-
nent presented by the Oregonian sub.
nitted above tends to prove this posit-
ion, aud it is correct one beyond
question. Gold and silver are in their
natural state only commodities, ard
the price of either is regulated by the
demand. Increase the demand for
either by making it machine for
exchange and the price must
Use. In short, legislate SO as to
create demand for either, as is done
oy making it a standard of values. in
,ther words, basic money, and its
,rice will rise, On the other hand,
ieprive it of this function. and its price
will fall.