The times. [volume] (Richmond, Va.) 1890-1903, 1897-10-31
THE POLICY OF GAGE.
OUTLINE or ms RECoHMESDA-
TTONs 70 THB cABINET.
Reduction Of Government Obiigauons--io
Refund Loan Bonds- -shanges NOT
Radical Suggested.

WASHINGTON. october 3o.-Mueh In
tercst Is taken IN the outline Of financial
policy submitted 10 the President ana
Cabinet b. Secretary Gaze. The sus-
Kssuons made are just about what has
bean anticipated. but the official state
r.r,. ,skes the matter out Of the field
OF speculation.
t,s tn accordance with the view Of the
leading bankers Of tho country and grau-
wing To- those who are opposed 10 any
ec,,nrorplse with tho silver sentiment
no',ro NJ nothing equivocal on that point
s-se oniv thing in 10 that IS viewed Win
som. SUNRISE is the statement mat 'ho
,,cssurv has declared itself ready when'
.,or necessary 20 the maintenance OF TINS
,.srifv 10 exchange on even terms az the
Measure Of the holder. either form OF the
metallic money Tor the other.
II has been said by some that u was .ne
nollcv OF the treasury not 10 REGARD WY
l,Ir silver dollars as basic money, but II
has never been understood that the oe-
,sr.nnont hold itself ready 20 give gold IN
sxchance Tor silver coin. which IS equiva-
lorf fo making the silver coin redeemaoie
in gold -,,,.. o,.,r
vss I'm operation drawing out the goa
reserve from the treasury that the only
sorts Of currency available TOT t"c Pu'
poses OF getting the gold were 'he siee.-
hacks and the so-called sherman notes
OF $500 ~.
This statement. however. indicates tnat
Tho silver coin and silver ceruhcales
r,i0hf be used IN the same way py nc
ing presented for redemption IN gold
SECRETARY CAGES PLAN.
THO Secretary SAYS that his predecessor
e. noiro sfnce the war have regularly, IN
their annual reports called attention 70
the menace TO the public credit occasioheu
bv the continued use OF the large Voiuihe
OF demand liabilities represented by tne
legal tender notes. and have frequently
appeaied for legislation TO remove the
In addition 10 the S3isooO.ooO Of legal
tender notes. and Sli0Oe0 or treasury
notes. the government must hold itself IN
readiness 20 maintain the Tree inter-
cheneeabiHty with gold Tor Ai0@0'W IN
silver. The aggregate Of these liabilities
amounts 20 S90O00O00. although the gov
eminent may never be called upon 10 pay
this at any one time or any large portion
~ n ~ a time From this the Secretary
proceeds 10 argue that the TRADITIONAL
Sl00o0OOO gold reserve is inadequate no
matter how good The conditions OF lhe
country or the confidence OF the people
Conditions Of prosperity and happiness
are not always assured, ne says
The Secretary then says: 1900,
pEUrtTiGN or OBLIGATIONS.
"Tvhe condition OF the Treasury In its re-
iation % demand obligations requires that
one OF two steps be taken The one may
be a large reinforcement 10 the permanent
gold reserve. The other may be by an
important reduction I'm the ob1ectonaI
form OF Liabilities. The latter is, in my
opinion. the more desirable.
NV first recommendation IS that proper
legislation be enacted which viii estapiish
separate and apart from the ordinary
operations OF the Treasury as they relate
10 revenue and expenditures. depart
ment 10 De designated and known as the
issue and redemption division To this
division the sum OF rs millions in gold
coin should be- set over from the general
fund In the Treasury. 90 Doe used only LOT
redemption purposes, that an the sINer
dollars now held for redemption OF SILVER
certificates. and an the silver bullion ana
dollars coined therefrom. bought under
the act Of 1890 be passed 10 the same ac-
count
"Furthe~ that the sum Of 200 million,
In the legal tender notes OF the United
States known as greenhacks. be collect-
ed as hereinafter described. and deposited
IN the said department of issue and re,
demption. 20 be dishursed therefrom only
uuon the receipt in exchange therefor OF
an equivalent amount Of gold coin such
gold. when 80 secured. 20 be held IN said
department as part Of the general re-
dempuon fund.
TO REFUND LOAN BONDS.
second. 1 recommend that provision
be made for the issue Of retunding loan
bonds. PAYABLE after ten years at the
nleaenre NJ the government. Such bonds
10 hear interest at the rate Of IL per
cent. per annum. payable principal and
interest in gold coin. and that the Secre-
sary Of the Treasury be authorized 10
issue such bonds and receive IN payment
therefor. with an equitable allowance lor
the difference in interest, any part or an
OF the outstanding loans of the United
states which mature by their terms OF
uavmont in the years 1898 and l%Vr
s.The advantage involved In this propos-
"a action lies in this: First. IL removes
an ambiguity from our contract ooliga-
tions-au ambiguity which Affects unIa-
vorahlv the government credit The word
coin now used to express the obligation
IN the public debt IS an ambiguous word.
I. IS no doubt understood by the more
discriminating public creditor 10 mean
gold coin. and the solemn act OF con-
gress pledging the maintenance OF silver
coin upon a parity with gold coin makes
Il impossible 20 construe the word coin
as therein used 10 mean anything other
than gold or It's fun equivalent.
no SUPPLY THE DEFICIENCY.
ITO accomplish the objects herein sug-
rested without unnecessarily contracting
the circulation. some other form OF paper
money must De allowed 20 hn the vacuum
which might otherwise be occasioned.
The national hank note, now familiar 10
our people IS the readiest and most prac-
teal agent % accomplish uhat object, and
under reasonable conditions II Will be
found responsive 20 the call
IAN enlarged issue OF bank notes thus
contemplated would require a number OF
amendments TO the present national bank
act
These amendments should be made
only upon such conservative lines as
would. while granting the necessary aid
20 the business world IN facilitating ex-
changes. I'm nowise weaken the system,
or lessen the stability OF the notes 10 be
issued The complaint uttered against the
national bank act as Il now stands is not
directed 10 the method Of bank organiza-
ton or the absolute safety guaranteed 20
the note holder. IL is directed TO those
restrictions which II emhodies that result
IN its failure 20 accomplish the full bene-
IN which otherwise would follow.
in order 20 obviate 10 as great an ex-
tent AS possible these objections and make
....r. ha~rroniofis with prODPr