Omaha daily bee., 1898-09-16

So-c8lled sound money for an elastic
currency" Is far more than Is here indicated.
IL Is claimed for such a currency as is now
proposed that Il will expand and contract
at all times in response to business wants.
currency that would automatically ex-
pand and contract 50 as to always supply
Just so much currency as is wanted and no
more, might be an ideal currency, but in
fact no such currency ever existed and none
such is possible
The issue at last lies between a currency
Issued by FIVE, or 1t may be, 1000 banks as
their own interests may dictate and with
| drawn when IL becomes their interest to
withdraw II, and a national currency issued
and controlled by the government. in ac-
cordance with established principles and
under liked rules Of law That is the real
issue In this country. and as a part of the
whole money problem is paramount to any
other. In advocating a national currency
issued and controlled nv the government we
make no war on banks or bankers but the
business Of banking is one thing and the
right to create money is very different
| thing.
| Congressman Fowler Replies.
The reply to him was made by Congress-
man Fowler of New Jersey, with care
/ fully prepared paper giving the history Of
monetary evolution and replete with figures
to substantiate his support Of a bank cur
I rency. Before proceeding with it, though
! he found it necessary to meet pithily some
, of the propositions of General Warner and
! the bimetalists. Said he:
! When our silver friends insist that both
metals shall be admitted to the mints under
free coinage they shall also be accompanied
| by an enforced legal tender, they admit they
are going to nfuse value into something by
! law But IL by law you can infuse value
/ into something-into sllver-then you can
| take piece of paper and by law you can
| infuse value into 1t of a hundred cents, and
1 l.VV, ,Iv.l NH.V, V,Ntl rHnRn
fore, the only logical position for them to
! take is that Of my friend, Warner, that Of
fl tism.
The Bank of France, with a capital Of
S35 900, 900, is authorized by the French gov
| ernment to issue notes to the amount Cf
81 900 900, 900. but by the law Of France these
notes are only legal tender insofar as they
can be redeemed by gold coin. say gold
coin, for France is carrying her burden Of
silver, and If the demand should come and
the test ever made do you suppose France
would say: 1--WE will only redeem in sill
ver?" II so France would go to a silver
basis. AS it is the Bank Of France has not
issued more than 800 900 900 or $3.50, ,000, 600
or SITS, 900, 900 at the utmost. According TO
General Warmers theory the bank would
! eagerly go ahead and issue the whole bill
lion. The banks of Canada, with COM
bined capital of S6l,O0Oo00, have right TO
issue notes to that amount. But do they?
No. Only in the fall to meet the demands
Of the crops do they issue an amount not
exceeding $3S, 900, 900. Then IS. 600 900 of
these notes are retired, being a range of
rise and fall amounting to IS 5000 000 as the
demands of business require. This has been
the case with Scotland for 200 years, and
she has had only three failures in all that
time.
] am in favor of bank currency, not bank
money.
Continual Loss Sustained
One important point in his paper was the
proposition that the government OF the
United States is suffering a net loss of
per cent every year on the silver boarded
in its treasury, owing to the decline OF
silver. The government has issued s563,
100000 OF notes at a cost to the government
OF SiG4 600 paid out for silver, which al
the present price of silver is worth only
S275, 100000, resulting in a net loss to the
government of $3.50 100000. His main ar.
/, gument was in favor of bank issue as
against government paper money Sub.
stantially he said:
The marvellous material progress of the
last fifty years has been due to cath
olicity Of spirit and freedom from
prejudces and traditions. To such ar
amazing degree has 1t spread that it would
seem that but little more could be devel.
oped for the benefit of man, if only hi
: might reap the largest profit out of the ia.
|
come one vast mart, each producer con.
suming every year something made by every
! class of labor in every part of the world
The tremendous economic problem of the
twentieth century springs from the stubborn
| contest for higher wages and cheaper com
modities and If the one great factor O.
: cost, transportation, is to be reduced it,
, essential element, medium of exchange
must be considered.
The irrepressibe inquiry then aries
: What shall the medium of exchange be
, Law and custom have constituted checks
bills of exchange, drafts and letters o
credit as the mediums that perform at leas
nine-tenths of the commercial work of th
world, hence the particular inquiry mus
be. What is the best instrument to per
! form the remaining tenth?
a Discarding all distractions Ii NAV b.
q stated that money is made of a commodit,
OF commercial value, bearing a stamp as t,
quality and quantity, and is used to meas
ure values, although 1t may be employed t,
! transfer property. The standard of valu
! of the United States is gold, hence golt
i coin constitutes the only money in In
Z United States. All other mediums of ex
: change are merely representative of money
or in other words, currency.
= What then, is the best form of currency
! bank notes or the demand obligations O
o the government? Such a currency shoult
1 be safe, adequate to the requirements o
V trade and as inexpensive as checks. who's
r place, for convenience it takes. Currenc
( is tool upon which in fairness no ia;
can be laid. currency meeting these es
D sentials can only be created out of the va
. ried products of American toll But /
( such currency safe? AS much safer thai
r government currency than 5000 900 90
$ OF liquid wealth is greater than the go
. reserve. Government issue is the dream O
L perpetual motion applied to economies. II
! intimation that a worthless piece of pane
is now and ever shall be its own redeeme
> leads to an increased price without refer
{ ence to eXchangeable value, and so on an
-, | on to reputation. A government canno
u create something out OF nothing, as Eng
n ! lands experience with clipped coins Law
: career in France and the story of our col
A onies, our struggling states and the incom
q ! prehensble losses from 1893 to 1895 al
A ! prove. government issue fails to NEE
d any OF the essential requirements of a cur
l. rency of trade; it has no inherent com
e mercial value, II bears no relation to any
e thing else of value, it is spent money a de
e mand for payment and when reissued a re
o ceipted bill
t The proper currency OF trade, on the con
e trary, comes into existence and does il
d work just as the currency of commerc
5 does
d The safeguard that will insure the curren
o eonvertibiltty Of every note Issued by tn
. banks into the measure OF value % tn
u country will be an absolute guaranty to tn
= people that that bank currency is as goo
u ! aa gold coin, If the standard of the coun
I iG ggnlI hnp hoo