The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1898-01-03
WASHINGTON BUREAU ST. PAUL GLOBE,
C0RCORAN BULL DING.

WASHINGTON BUREAU ST. PAUL GLOBE,
C0RCORAN BUILDING.
Special to the Globe
WASHINGTON, Jan. 2.-The report
Of the monetary commission was given
to the press tonight and so congress
and the country are now supplied, in
cluding the recommendations of Secre-
tary Gage and the president, with ade-
quate information as to defects In the
existing currency system. The reme-
dies proposed show agreement as to
fundamentals, but differences on de-
tails. The monetary conference re-
port is likely to prove more popular
than Mr.. Cages plan on account of it's
provisions for bank circulation based
on the assets and the better promise
1t affords of supplying remote sections
with a sound, elastic currency and con-
sequent equalizing of interest rates
But like the plans of Secretary Car
Isle and Secretary Gage 1t emphasizes
the necessity of adheltng to the gold
standard as the essential basis of a
proper currency system. This is sure
to arouse the antagonism of the silver
ite politicians, although business people
in the rural districts would welcome
the better banking facilities 1t offers.
The fight is on. All reports are in.
Congress must do the rest. The rec
concentrations are as follows:
THE STANDARD.
The most serious evil of our present situa-
ton is the threatened degradation of our mon
etary standard.
The concurring habits of individual man
kind fix the standard by which to measure
the value OF labor and property.
Governments cannct try to change this
standard without making mischief.
The standard thus fixed is now gold. This
Is fact Of civilization.
Government, if it serves the people well,
accepts this fact and records 1t In law.
AS ali immediate means towards this end,
we recommend that 1t shall be provided by
law that all obligations of the United States,
existing and future, shall be payable in gold
except when otherwise expressly provided. By
the wise and courageous action of its execu-
tive officers the government has upheld that
standard by paying its obligations in gold.
But until such payment is required by law
and the door thus closed to all question as
to the meaning OF the word coin in the obli-
cations Of the government, we shall not have
an established gold standard in the full sense
of those words.
DEMAND OBLIGATIONS.
At the present time the government has no
fund for the payment of it's demand obliga-
| tions except the general balance in the treas
| ury applicable alike to the payment of all
| QueS. our revenues are uncertain IN amount;
! our expenditures are large and growing, and
| liable to vary. 1t is, therefore, uncertain
| whether we shall have at any particular time
| an adequate fund for the redemption of the
| demand obligations without recourse to bor-
| rowing. Borrowing is an Intellectual resource
because under the law as it stands the notes
which have been paid must be returned to
! circulation, and so may be used over and over
to draw out the borrowed gold The issue
OF bonds, moreover, rests with the executive
department, and whether it will be resorted to
or net will depend upon the personal views
and discretion of the officials at the head of
that department. More serious still is the
fact tiat it is in the power of the executive
department, as the law now stands, to decide
whether the government notes shall be paid
in gold or in silver. An end should be put
to this anomalous and hazardous situation by
making specific and adequate provision for the
payment Of the demand obligations, and di-
rectlng IN the law that such payment shall be
in gold at the demand of the holder.
| paper currency issued by the government
and circulating year after year without re-
demption educates the people In false notions
concerning money. 1t appears to those who
do not look at it critically to derive It's value
from the government stamp" 1t ceases TO
be regarded as promise to pay money, and
seems to possess the virtue Of money in and
of Itself. And 1t is so easy to create it that
when times grow hard the call for more is
perfectly natural There can be no doubt
that the alteration OF Judgment on the money
question by SO many OF our people in recent
| years has been largely due to the miseducat-
ing influences of the greenback currency.
| Such a currency also lacks the important
| quality of automatic adaptability to the vary
| ing demands of business. paper currency
created by legislation is fixed In volume by
the law of its creation, and can neither con-
| tract nor expand in response to those varying
conditions which are bound to occur in the
affairs of men
More important than this is the fact that
| such currency puts upon the government
burden In the maintenance of the credit OF
all the financial institutions Of the country.
If the government should fail to redeem It's
notes, all bank notes, bank deposits, insur-
ance losses, and debts and dues of every kind
not specifically payable in gold would be pay
able in the deprecated paper or in silver.
Every passing incident, therefore, which raises
an apprehension, however slight, of a posi-
bility, however remote, that the government
may be unable unwilling to maintain gold
payment OF its obligations sends a nervous
tremor through the whole business system of
the country Sovereign government cannot be
compelled to pay its debts; 1t pays them only
when it wills so to do; and the existence Of
doubt in the public mind to the continu-
ance of the will of our government to pay
its demand obligations in money satisfactory
to the holders thereof is serious drag on
business enterprise
The existence of large outstanding debt
payable on demand is also a source of weak
ness to the government in its International
relations. Modern warfare is SO expensive
that it is almost as much matter Of money
as men. nation suddenly confronted by
the alternative of war or dishonor would be
greatly handicapped Dy large Oemanu QeDC
which 1t must provide for at once. Great
additional force is given to this considera-
ton by the fact that 1t would be scarcely
possible for this nation to engage in war in
it's present notwithstanding part of the
situation the imperfect development of clear
conceptions on the subject of money in the
minds of the people-without a suspension
of specie payments and a resort to further
issues of government bonds. There is no
| doubt that If our government were relieved
of It's existing demand obligations, and our
currency system put in working order upon
gold basis 1t would be entirely possible
for us to go through war without suspen-
sion of specie payment, or any arrangement
of our monetary system. If war should come
the value to the country of the ability to
thus avoid the indirect losses following from
! deprecated currency, inflated prices and
financial decentralization would be so great
that the burden OF paying off our de-
mand obligations would be as nothing in
comparison.
We have a total volume OF paper and sill
yer in circulation amounting TO s9Os, ,72S. .Os7,
all resting for It's value on the credit of the
government, less only the bullion value of
the silver. That credit is maintalnable only
| as whole. The paper of the United States
could not be dishonored and its silver up