Iron County register. [volume] (Ironton, Iron County, Mo.) 1867-1965, 1897-05-27
BRYAN ON THE BONDS.


4 Cn9AE08A OAM&AGEs
In q letter from Lincoln, Neb. On
MAY 10, to the New York Journal. VIII
liam ]. Bryan reviews the statements OF
Chairman Dingley. of the ways and
means committee, made in late inter
view for the Journal. The following In
| Mr.. Bryan's letter in its entirety:
Chairman Dingiey. OF the ways ana
means committed. in his interview pre-
| pared for the Journal. reiterates the charge
frequently made by the republicans dur
ing the past four yearS-namelys that the
bonds were issued because OF q deficit In
the revenues, and he holds out the hope
| that the drain upon the gold reserve VIII
cease when the deficit ceases
II do not believe that his theory VIII ex-
plain the drain upon the gold reserve. nor
| do think that his hopes are well found
| ed. While 1t is true that large part of
the money received from the sale of the
bonds was used In making good the deficit
in the revenues. yet at no time did the
| deficit cause the issue of bonds.
Instead of being an injury, the deficit was
| during that period 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 II the revenues of the
government had equalled its expenses. then
| that money would have been held In the
treasury. and business would have been
crippled more than II was.
| THE fact that gold Withdrawals began
before there was deficit and ceased while
the deficit was increasing shows that there
| Is no necessary or intimate connection be-
| tween the revenues and the Withdrawals.
| If gold is needed for export 1t will be drawn
out, no matter whether there Is a current
| deficit or surplus, so long as the treasury
stands ready to furnish gold on demand.
| The recent Withdrawals Of gold took place
| just at q time when for the first time in
several years. the revenues exceeded the
| expenditures
1.-The press dispatches did not attribute
! the late Withdrawals to a deficit, nor did
| they attribute them to q loss OF confidence.
The reason given was that new demand
| for gold had sprung up in Japan and
Austria.
IF gold Is desired for boarding. or for
the purpose OF forcing an issue of bonds.
| 1t will be withdrawn, whether there Is
surplus or a deficit, unless the secretary
| protects the government by exercising his
| option and redeeming in silver. When
| falling prices make ordinary loans UNI
| safe and ordinary investments unprofit-
| able the holders of idle capital are apt to
! advocate an issue of bonds for the pur-
| pose of securing a safe investment, and
when the desire for bonds becomes strong
enough they can draw gold from the treas
! ury by presenting greenbacks and treas
! ury notes and then use the gold to pur-
! chase the bonds issued.
THAT such a plan has been contemplated
| by New York financiers cannot be doubted.
| Some three or four years ago one of the
New York dailles declared that In case con-
| gress refused to retire the greenbacks with
! an issue of gold bonds the people who
wanted greenbacks retired should system
atically present them for redemption until
they were all locked up in the treasury.
THAT the New York flnanciers have used
| their power to discredit government paper
| is evident from the fact that when an at
| tempt was being made to repeal the Sher.
| man law they presented treasury notes for
redemption. When they desired to force
O n rrraenhoRka thew nrpaentan
| greenbacks for redemption. So long as
| the secretary Of the treasury surrenders
to the holders of government paper the
right to choose the coin in which payment
is to be made. so long will 1t be possible
for the financiers to present either treasury
notes or greenbacks and draw out the gold.
Mr.. Dingley is in error in supposing
that the redemption of So, 0o0, 900 OF green
backs or treasury notes would make such
scarcity of small notes as to prevent fur
Their Withdrawals of gold We have some
times had during the last four years con-
siderably more than $50O0O,0oO OF these
notes locked up. and yet gold has been
withdrawn.
There has been O well-founded sus-
picion that much of the gold drawn out
by the presentation of greebacks and treas
ury notes was drawn out for the purpose
of forcing a retirement of all government
paper. If the fnanciers conclude to bring
their influence to bear upon the present ad-
ministration as they did upon the last
they will have no difficulty In forcing an
issue of bonds. unless the new secretary
of the treasury shows more power Of resist
ance than the last one.
IF the national banks succeed in Sc
curing the law which they have advocated
for some years-namely, the law permit
ting the issue of bank notes up to par and
reducing the tax on circulation from one
per cent. to a quarter Of one per cent,
they may become interested In having more
bonds issued to furnish a basis for bank
notes. II they do. the process is very
greenbacks and treasury notes and draw
down the gold reserve, then raise the alarm
and proclaim that the credit is in danger.
"If the secretary of the treasury yields.
as there is no reason to doubt he would,
they could buy the bonds with the gold
drawn out, and then Issue notes upon the
bonds purchased BY this simple process
the banks would be able to secure a safe
investment for their money. and then by
issuing notes up to the face of the bonds
would be able to use the money besides.
sit Is difficult to conceive of a more a6-
vantageous transaction than that. Usual
ly q man can either eat his cake or keep
It; il is left to the national banker to both
eat his cake and keep 1t. While others
must be content to use their money, or IL
they invest in bonds must be satisfied with
the interest on the bonds, the national
banker can, by investing In bonds, enjoy
the interest upon the bonds and then by
issuing notes enjoy the use of the money
also.
"I have referred to the fact that gold
may be Withdrawn expressly for the pur-
pose OF purchasing bonds. The records OF
the treasury department show that tlS.o0O-
COO were withdrawn for the purpose of pay
Ing for the first $50 900 of bonds issued.
and the proportion has sometimes been
greater than that. No one except gold
standard fnancier has been able to see
the wisdom of policy whereby bonds
are issued to buy gold and then gold fur
nished to the purchasers to be returned to
the treasury in exchange for the bonds
IF the Dingley bill. as finally passed,
yields a considerable surplus over ano
above the expenditures of the government,
that surplus can be converted into green
backs, and the greenbacks withheld from
circulation, but II the surplus 10 used to
purchase and retire government bonds, the
Rreenbacks will go into circulation again
In other words. the greenbacks can only
be kept In the treasury by contraction
of the currency, unless bank notes are ms
creased as rapidly as the greenbacks are
drawn in.
''It il true that when gold Is exchanged
for greenbacks the gold so paid out re-
niaces the greenbacks in the circulation.
bur n bonds are issued for the purchase
of gold the proceeds must lie Idle In tho
treasury If the revenues exceed the ex-
nenditures II the secretary of the treas
ury continues to pay gold on demand ana
stands ready to replentsh the gold reserve
by bond Issues. IL will be possible for the
national banks to lock up all the govern
ment paper In the treasury vaults. max
ing, II they so desire, corresponding In
crease In the volume of national bank
notes.
1.-THE national banks want to retire the
ereenbacks. The question Is: VIII they
demand the passage of law providing for
the retirement of greenbacks. or will they
use the power which they now have to lock
the greenbacks up In the treasury and