The Stark County Democrat. [volume] (Canton, Ohio) 1833-1912, 1898-02-10

bHe FbHUn hTlny III liJfiWOIhou iuS rum
In the year 1871, Edinbsrg, Scotland,
gave TO the world financial genius In
the person of John Law, the son of q
goldsmith. The goldsmiths of that day
were the bankers of the world. In 400
he presente in priDt plan for what is
now called the National Bank of Scot
land, differing only from the systems
now In use by European national banss
so far as 1t inciuded the system, then
universal Of monopoly of commerce d
Of farming out the revenue. W. next
find him exploiting his theories in Ger
many and Spain, and later we find him
flying his financial kites over bankrupt
France, until, in 1720, he at the head of
a bank fostered by the pattern care Of
the French nation, revolutionized values,
and within one year from the reaching Of
the zenith of his power ruin came, and
within that time thousands became rich
who were poor, and tens of thousands be-
came poor who were rich.
While Scotland furnished her John
Law, England produced her william Pat
terson, a merchant If London, who per-
ceived that his government, which had
been paying from 90 to 40 percent inter
est per annum in her distress brought
on by her war with France, would readily
yield to extortion and grant exclusive
and almost unlimit d pri sileges to such
parties as would furnish it with n perma-
Dent loan at a more reasonable rate Of in
terest. He formulated his plan, brought
it to the attention of the king, 1t was
Submitted to the privy council, and as its
embodiment the law creating the Bank
Of England was pas ed by Parliament on
the 25th day of April, 1894. 1t provided
that it's capital of 1, 900, 900 pounds sterling
should be permanently loaned to the gov
erment at 8 per cent per annum, and in
addition to the interest, an allowance of
1000 pounds sterling should be made by
the government as compensation for the
management of he debt. Its capital
has been increased from time to time up
to October 10, 1879, when 1t reached
IA, 553, 900 pounds sterling. The govern
ment debt assumed by the Bank Of Eng
land is now about 100000 pounds.
The bank collects all the revenue a. d
pays all the government debts The
bank props the government and the gov
ernment props the bank; case of "uni-
ted we stand, divided We fall" On
February 81, 1907, an order was issued
bx tho Drivy cO, ,pil raetr. Al nj ~ tho n N
from further pay yment Of specie, and on
the following day the b nix issued
notice stating that in consequence 0f the
restraining order "they think it is their
duty to inform the proprietors of the
bank stock, as well as the public at large,
that the general concerns of the bank are
in the most affluent and flourishing sit
uation and such as to preclude every
doubt as to the security Of its notes, +" and
announced their determination to con.
tinue their usual discounts The true
state of affairs was the bank could
not longer pay specie, and the priVy
council kindly furnished them an excuse
for not doing that which was beyond
dollars of notes for every dollar of specie
to redeem with, and when trouble Is
imminent, is widely and prudently en-
Joined from paying twenty dollars with
one. The injunction of 1897 was to be
but temporary, yet the bank rested peace
folly under it until May 81, 1928. The
English Parliament sought to learn the
cause of tine fluctuation of her money
stan dard, through selected committee,
whose report, III de and ordered printed
June &c, 1910, in the opinion Of j, r. Nc
Cullough all but perfect the theory of
money when it reported that ian incraese
in the quantity of the local currency of a
particular country will raise prices in
that country, exactly in the same manner
that an increase in the general supply of
precious met lis raises prices all over the
world, " and doubted whether since the
new system of Bank of England payments
has been fully established, gold had in
truth continued to be their measure of
value-a veritable and elaborate re-as
ssrtion Of the doctrines of Montesque and
Hume, announced half a century before.
The Bank Of England pretended to be u
specie paying bank, and the first in the
world to issue its notes payable on de-
mand for individual paper payable at
future date, thus agreeing to perform an
impossibility in the hope that 1t would
not be called upon to redeem it's pro-
mise or make the attempt. Stephen Col
well christened it "a Pandora's box of
evils, opened to trouble the commercial
world" In 1874 Sir Robert Peel, in
an atteDmt to remedy its ever
varying and never stable system, first
of expansion then of contraction,
under the single gold standard, provided
for the issue department of the Bank of
England, which should provide the notes
payable on demand, and from August 81,
1874, be kept wholly separate and dis
tinct, and that on that day the bank
should transfer to the issue department
securities to the value Of fourteen mil
lions, the public debt to be deemed a
part, and the banking department should
transfer to the issus department all the
gold coin and gold and silver bullion not
required for its own use.
This is the scheme now sought to be
borrowed and engrafted on our system by
our secretary of the treasury and the In
dianapolis monetary commission. The
subsequent operations of the back showed
IL To he "A chanpa INIT not a rpmadv for e.
suspended specie payments October 90,
1s47; suspended again November 12,
1854; and again on May II, 1856, and
will suspend again whenever it becomes
necessary so to do, for whenever it gets
too poor to pay, the English government