The true northerner. [volume] (Paw Paw, Mich.) 1855-1920, 1898-01-05
FOR CURRENCY REFORM
Abstract Of Report Of the None
tary Commission.
NEW BANKING SYSTEM PROPOSED.
To Substitute Bank Notes For Treasury
Certificates and DO Away With the De-
post of Bonds With the Government.
The Whole Scheme In Detail.

posit of Bonds With the Government.
The Whole Scheme In Detail.
The report Of the monetary commits
sion, containing the plan Of currency
reform proposed by it, together with a
full discussion of the subject and mass
of valuable statistics and other informa-
ton, has been sent out by the executive
committee of the Indianapolis conven-
ton. Following are the main points Of
the argument and the plan in detail;
The Standard.
The most serious evil of our present
situation is the threatened degradation
of our monetary standard.
The concurring habits of individual
mankind fix the standard by which to
measure the value of labor and property.
Governments cannot try 20 change
this standard without making mischief.
The standard thus fixed is now gold.
This is "a fact of civilization.
Government if it serves the people
we'll, accepts this fact and records it III
law.
AS an immediate means toward this
end we recommend that it shall be pro
vided by law that all obligations of the
United States, existing and future, shall
be payable in gold except when other
wise expressly provided. By the wise
and courageous action of its executive
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 obligations of the govern
ment we shall not have an established
gold standard in the full sense of those
words.
Demand Obligations of the Government.
At the present time the government
has no fund for the payment of its de-
mand obligations except the general
balance in the treasury applicable alike
to the payment of all dues. Our reve-
nues are uncertain in amount, and our
expenditures are large and growing and
liable to vary. 1t is therefore uncer-
tain whether we shall have at any par
ticular time an adequate fund for the
redemption of the demand obligations
without recourse TO borrowing. Borrow
ing is an Intellectual resource, because
under the law as it stands the notes
which have been paid III ust be returned
60 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 not will depend
upon the personal views and discretion
of the officials at the head of that de-
partment. More serious still is the fact
that 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 directing
in the law that such payment shall be
in gold at the demand of the holder.
A paper currency issued by the gov
eminent and circulating year after year
without redemption educates the people
in false notions concerning money. II
appears to those who do not look at 1t
critically TO derive its value from the
government stamp. 1t ceases TO be
regarded as a promise TO pay money and
seems TO possess the virtue of money in
and of itself, and it 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 judg-
ment on the money question by so many
of our people in recent years has been
largely due to the miseducating infiu.
ences of the greenback currency.
Such a currency also lacks the i'm
portant quality of automatic adaptable
ity to the varying demands of business.
A paper currency created by legislation
is fixed in volume by the law of its crea.
ton and can neither contract 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 "a currency puts upon the gov
eminent burden in the maintenance
of the credit of all the financial institu
tions of the country. If the government
should fail to redeem its notes, all banl
notes, bank deposits, insurance losses
and debts and dues of every kind no
specifically payable in gold would b.
payable in the deprecated paper or il
silver. Every passing incident, there
fore, which raises an apprehension
however slight, of possibility, how
ever remote, that the government ma,
be unable or unwilling to maintain golC
payment Of its obligations sends nerv
Gus tremor through the whole bushes
system of the country. Sovereign gov
eminent cannot be compelled to pay it
debts 1t pays them only when it will
so TO do, and the existence of doubt il
the public mind as to the continuanc
of the will of our government to pay it
demand obligations in money satisfac
tory to the holders thereof is seriou
drag on business enterprise.
The existence of large outstandin,
debt payable on demand is also a sourc
OF weakness to the government in it
international relations Modern warfar
is so expensive that it is almost as mucl
a matter of money as men. A natiol
suddenly confronted by the alternativ
of war or diehOnor xyoY1Id no oraa n