The morning news. [volume] (Savannah, Ga.) 1887-1900, 1898-12-30
NEED OF CURRENCY REFORM.
,,ONETARY STANDARD NOT AS Sc
CURE AS 1T SHOULD BE.

in the Way OF Elasticity in the
svstem-The Stability of the Gold
standard. However Is Practically
acknowledgements Called on by
american Economic Association to
Act.
New Haven, Conn, , Dec. 29.-At the clos
ing days session of the American Eco
,onic Association convention now being
held in this city, the report of the special
committee on banking and currency was
presented by the committee, consisting Of
prof f. M Taylor of the University Of
Michigan, chairman; Prof. F. w. Taus-
sing of Harvard, ]. W. jerks of Cornell
University, Sidney Sherwood of Johns Hop
kins and David Kinelly of the University
Of Illinois.
The following are some of the points
made in the report:
your committee to which was assigned
for consideration the subject of currency
reform in the United States, beg leave TO
rcport that they have agreed upon a series
of statements with respect to the need, the
objects, and the methods of such reform,
which it is believed would command the
assent Of economists generally, and which
are submitted.
The Need of Reform.
Despite the fact that much improve
ment has taken place within two or three
years. there still exists a real need for
monetary and banking reform in the
United States. The standard of value
upon which the whole system rests is by
no means as secure as it should be. The
circulating note system is stin greatly
lacking in elasticity. Adequate banking
facilities for newer. more backward
districts are stil wanting. In the system,
as a whole, there is a notable lack of
unity and organization.
In citing the first particular, j. e., the
insecurity of the monetary standard as a
proof that currency .reform is needed
your committee do not mean TO imply that
the existing standard is the only possible
one, or even the most desirable one. 1t is
merely assumed that, so long as that
standard is retained, it should have the ut
most possible security; since the unques-
toned security of the monetary standard
Is Indispensable to a high degree of indus
trial prosperity.
stability of the Gold Standard.
1T is possible, however, to argue that
the defect in question no longer exists
that the stability of the gold standard
is now substantially assured. There is
unQuestiOnably much force in this conten-
ton Besides number of temporary cir
cumstances, such as a fun treasury. a
large gold reserve, and a favorable trade
balance of exceptional amount, several
changes of more permanent character
have contributed to the Improvement Of
the situation.
AS respects the need for elasticity In
the note system, next to nothing has been
gained. In the first place, we still retain
for our bank circulation the system of
bond security, and under that system it is
in the nature of the case extremely diff
cult, if not impossible to secure in the
currency that prompt and easy adjustment
of volume to need which constitutes gem
uine elasticity. In defense of this state
ment much might be said, but it may
suffice to call attention to single consid-
Grafton. If bank circulation is TO be elias
tic, the assets which are required as a Sc
curty for that circulation must be such
as a bank ordinarily has in it's possession;
since, in a stringency when expansion is
needed, the bank already has its resources
locked up, and consequently can not with
out great difficulty get hold of new assets.
But government bonds are not a kind of
assets which banks will, or usually ought
TO- have on hand in considerable amounts.
Little Progress Made.
what has been said concerning the
continued lack of security and elasticity
applies in substance TO every other recog-
nized need of the monetary system AL
most no progress has been made. Ii thus
@
which we can insure that, when less fav-
orable conditions arise, there shall be no
recurrence of the disasters formerly ex-
perienced, is to bring about some more or
less fundamental changes in the none
tary system itself.
Without doubt there are still consid-
cradle obstacles in the way of reform
It is easy, however, to exaggerate the Sc
riousness of those obstacles. Your COM
mittee wish particularly to remark this in
respect to the much-nOIed Emergencies of
opinion among friends of reform. The not
uncommon opinion that these Emergencies
are so serious as to render hopeless the
prospects of reform, we consider quite I'M
warranted. AS a matter of fact barring
differences due to the circumstances of
some being more, others less, radical, the
various projects of reform have a sur
prisng similarity. Doubtless there are
differences of method so fundamental that
the choice Of one plan involves the re-
lection of its rivals; but cases of this sort
are comparatively few. An analysis of
& large number of plans of reforms dis
close the fact that, of the various expe-
dents proposed TO them for accomplish
Ing the several objects sought, a large
proportion appear in nearly every one of
the plans. In the light of these facts, your
committee are of the opinion that what
Is most needed at this juncture is a dis
position on The part of The friends of re-
form TO sink individual preferences as 20
details and to insist that Congress shall
enact such legislation as it shall be posi-
Die 60 agree upon"