The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1898-12-07

Doubt should arise as to the sufficiency of
such provision. it could be made the duty
American coin in direct change for the
Porto Rican coin az the custom-nouse ratio
whenever in his opinion 1t should be neces-
sary so to do in order TO maintain the ratio
RATE OF RATIO.
''The rate or ratio TO be adopted should be
determined by the fair average of the Porto
Rican coirs during the last three or five
years in their power to purchase bills of
exchange on London or New York. If the
information necessary for fixing the fair
ratio be lacking, the subject might be re-
ferred to q commission OF experts, who,
after hearing testimony from merchants,
bankers and wage earners in Porto Rico,
could undoubtedly fix the ratio based upon
the specific facts presented TO them.
From information fairly to be relied
upon it appears that the island coins have
had a value in domestic exchanges and in
the purchase of sterling bills considerably
above their bullion value, measured by the
worlds price for silver. 1t would seem just
and wise TO adopt this local value in the es-
adjustment of d fixed ratio to the United
States standard To adopt the bullion value
of the currency in fixing such a ratio would
seriously disturb existing conditions between
debtors and creditors.
IF a laborer's wages be 1 peso per day,
and the average power of that coin to pur-
chase what his needs require be equal to 60
cents gold, then to reduce the value of the
coin in which he is paid to 40 cents would
by SO much destroy the reward of his labor,
although his nominal compensation should
remain the same. On the other hand, to
raise the value of the peso to the value of
our dollar (though the disparity in weight
and tinenesS between our silver dollar and
the peso is smalD would operate to increase
the labor cost to the employer to a point
where the product obtained might not JUS
t1fy by its market price the cost of prOduc-
ing it. This, of course, would depress in
dustry and throw labor out of employment.
Again, the relations between debtors and
creditors call for equitable and just cOnsld-
Grafton. 1t is estimated that in the form OF
mortgages, ETC., there is an indebtedness of
some twenty or twenty-five millions, and
that the current shorter-time credit obiga-
tons aggregate about the same in amount
The average value of the peso for some time
past is the best measure of the value that
was transferred when these evidences or
debt were issued TO make an arbitrary
change SO as either to enhance or reduce its
general average value would therefore work
hardship and injustice The average power
of the peso. while widely fiuctuating between
the two limits, has ranged from loo to 190-
that is to say at times 100 pesos were as eff
fective in paying a debt or buying goods in
London or New York as 100 American dol
lars; at the other extreme, it has required
1870 pesos to be as effective as 100 american
dollars
FIXED VALUE FOR THE PESO.
Subject to correction from a better
knowledge, 1 think all interests would meet
in giving fixed value of 166 % to the peso
that is to say, the peso shall be maintained
at the value of 60 cents, first by receiving it
in payment for customs at that price; Sec
ond, by giving for it, when required, Amer
lean money at that rate of exchange. 1t is
by a similar process that our own silver
money has been kept on a parity with our
gold coins.
1T is not contemplated in the considera-
ton here presented to retire the Porto
Rican coins-certainly not until the coins
of the United States have become familiar
and acceptable to the people, There are
three things to which a simple people cling
with tenacity-their language, their re-
ligion, their money of account The peso
and it's fractional part, the centayo, are
terms made familiar by use, to the laborer
and the tradesman. These coins valued and
fixed as above suggested, would no doubt
Tor some time be preferred to the American
coin which to their minds would present the
apparent contradiction of coin of the same
material, possessing less bulk and weight,
BILE value. They would doubt at first, refuse
to believe, and cling to the terms peso and
fective ones, dollars and cents There
fore the peso, If received through the GUS
tom house or for other taxes, or if re-
ceived in exchange for American money at
the government agency, would be again dis
burSed or re-eXchanged as demand from
the people might require. III fact it may
be necessary, in order to give absolute
steadinesS to the peso not only to receive
or redeem it at fixed price to be again
disbursed at the same price but it may
also be necessary to coin at our nints an
additional amount Of the pesos and their
fractional parts for use in the island. If,
as suggested, customs dues be made receiv-
able in American money and the peso be
received as equal to 90 cents, there is
little or no danger that it will fall below
effective at GO cents for customs dues.
1t will not be exchanged elsewhere for less.
But this would not prevent it's rising above
that value.
1T is now apparent that the influx Of
American money is having the effect to give
the peso higher value. The peso being the
of all classes, 1t becomes desirable to eX
change American money for the domestic,
and the pressure to do this raises artiticially
the exchangeable price of the peso. The
broker and the money changer know how
to make the most of the opportunity. To
counterfeit this operation, which tends to re-
press the Introduction of capital in the form
of money, it may be necessary, as before
stated, to coin on government account an
which shall be freely offered in exchange at
the uniform price, this new supply, together
with the old stock, to be received at the
custom house or otherwise redeemed at the
same price.
NEW COINS NEEDED.
"At the risk of prolixity. which the impor-
lance of the subject might excuse. I submit
this additional thought for such considera-
ton as it may merit The present Porto
Rican coins carry the emblems of Spanish
sovereignty. Whether or not additions to
the coinage be made, new coins should be
struck, Of the same weight and fineness,
upon which should be imprinted proper en-
blems Of our new relations, and these should
be substituted for the old. BY melting up
the old as they come in and by paying out
the new, such a substitution can be easily
and quite rapidly effected. Gradually Gus
tom ana use would establish American
money, Whether OF silver gold or paper, as
the medium of exchange and payment
Inen 1t may be expected that the pres
ent Porto Rlcan money will not be called
LOT, American money and American terms
OF account ana payment having superseded
those now IN use. Then, upon the govern
ment-elther OF the island itself or upon
the United States government, as may be
determlned-the loss will fall resulting from
the redemption of the Porto Rican coins at
an generalization. If the peso be rated at
% cents, as herein suggested and if the
bullion IN the coin remains at it's present
value of 30 cents, and, lastly If the amount
of the silver money referred to be correctIy
estimated at 900 pesos, the loss would
amount to $l,l00,OO0 American money This
would be the ultimate cost of relieving the
island from the grievous ills of a bad cur
rency system. The benefits would be i'm
mediate, anu 1t may be hoped, would be
continuous for all time. The cost. when it
began to be experienced, would be distrib-
nted over series of years. and might cas-
liy De covered by proper appropriations
from the revenues of the island.
the peso is fully recognized by all parties
In Porto Rico. although opinions differ
as 10 the ratio which ought to be observed
IN relating 1t to American money. Sug-
gesuons have also appeared in favor of
Immediate and coercive exchange of the
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