The sun. [volume] (New York [N.Y.]) 1833-1916, 1899-07-17
PROGRESy ~ CURRENCY REFOHh.

ononsd on Monday. 1t is not to tho credit OF
operators that they arc thus easily bu1eteu
about by every pun OF rumor but that they are.
tho record shows. There is large unsattsHed
investment demand for good securities. but
,dded 10 this is so great mass OF speculative
nurchnses by people who stand ready to sell
srs,n on the slightest provocation. That u Is
dincult 10 tell whether we are on firm ground
or upon a shell which may give way Mt any
moment as happened IN 1855
Ths Caucus Committee OF the incoming
uorso -, REPRESENTATIVES. which sat at At
,.r,ic CIV last Arrll to consider the subject OF
,..o,,v rntnrn has passed over the result OF
i,s lshors To- the senate Finance Committee.
,,d +bst h,dy I'm turn. ia now at work perfect
,ng,h ill TO bc submitted to Congress at its APP
nroocbinp session The scheme devised by the
House Committee has not been author'tatlvely
nronuIgated but It is generally understood to
enbody. first the formal recognition. by law.
NJ gold ma the exclusive standard ot rnuo; see
ond an enlargement Of the note-issuinG power
o,tbo national banks from so cent. to 100
y cent q, the face value Of tho Government
hords dcrosited to secure tho notes. and. third.
the liking II tho lowest permissible limit OF
copitaI Of national banks at $25.O0O. in
s,ead Of the present $1O.OOO. Tho SEN
,,c Committee. it Is said has not yet agreed
IN ,J,rt the House Committees scheme as
n stands one Of the Senators insisting upon
,,. addition t. il Of provision for retiring the
Government legal tender notes and supplying
their pare with bank notes secured only by
bank assets and safety fund. a. proposed by
the Indianapolis Bankers Convention of 1897.
The Committee naturally. desires to make
unanimous report. and the majority OF 1t are.
therefore. laboring with its dissenting mem
Der, to induce him to waive his peculiar views.
Whether they succeed or not In doing this 1t is
pretty certain that they will not yield to him.
and that whatever be the scheme they finally
adopt 1t will not contain any such provision as
that for which he contends.
The fact is. that tho proposition to take
AWAY from the Government its prerogative OF
furnishing the nation with paper money and
70 turn over the function to our thousands Of
litte banks FOR them to exercise 1t for their
own profit has never commanded the approval
OF the majority Of our citizens. and the num-
her Of its supporters has become smaller and
smaller ns the discussion Of it has proceeded.
The only champion Of emincnce it now pos
sesses is the Secretary OF the Treasury. and lie
ia hy no means So enthusiastic in its behalf as
he was little while ago. The logic OF events
fl more powerful than that Of abstract theory,
end the experience Of tho last twelve
months has abundantly demonstrated tho
fallacy OF the antIuat"d arguments for pre-
ferring a paper currency issued by banks
TO ono issued by the Government. The
elasticity which was claimed rs the exclusive
merit OF bank currency has been shown to
be possessed in far higher degree by gold.
which, being imported and exported as tho
demand for money increases or dminishcs.
automatically regulates the supply of 1t: the
absolute safety Of Government promise has
been vindicated by twenty years of steady gold
redemption in the face OF difficulties which
have compelled the strongest banks. four
times during that period. to confess themselves
insovent; and the dcarth OF currency in the
agricultural districts. which. it was con-
tended. only a bank currency could remedy.
has been proved to be occasi0ned by n want Of
confidence on the part Of capitalists in the reo-
pie o, those districts which is disappearing
they increase in wealth and exhibit a willing
ness and an ability to deal honestly with their
creditors II Is seen that there is plenty OF cur
rency In the country to surply all legitimate
demands, and that any region destitute Of it
deserves to he.
Another supposed defect in an exclusively
Government raper currency upon which tho
Secretary Of the Treasury dcsranted eloquent
ly both in his last report to Congress and in
the address which he made last February to
the Bankers Convention at Richmond. Va,
has likewise been discovered to lie not defect
but merit. The volume of bank loans being
regulated by the amount Of their lawful money
reserves, any reduction Of those reserves neces-
states n contraction Of loans. and. thus an in
crease OF the rate Of interest and n decrease OF
the speculative prices Of stocks and OF COM
moiities. Such reduction takes place usual
" every year, at harvest time from the send
Ing away to the agricultural districts OF legal
nd and ,E.ir f,.tl .,
the crops to market. and 1t is proposed to
prevent II by sending bank notes. authorized
temporarily for the purpose. instead Of send
Ing lawful money. This Is so palpabIy an
abuse Of legislative power for the benefit OF
spectators and the banks that it cannot be
defended for a moment. Tho harvest de-
mand Tor currency can he provided for in adj
Nanc" by the banks without delcgatlng to
them unusual powers. They can. il they
choose. 50 arrange their business with refer
ehce to II, as they would with reference to any
other toroseen emergency. and refuse to cx-
pand their loans In winter to such an extent as
70 be obliged to distress their customers in
summer. In any event. n fall Of prices pro-
dnc"d by m increased demand for money is
the healthy and benenccnt result Of a financial
law. and we ought not to try and countcract it,
more important gain for the cause Of true
hnce Vt pubic sentiment in favor OF the single
god standard and tn" waning OF the craze for
me unlimited coinage OF silver. The Dem
ocratic PARTY. which. In 1896, went into the
PRESIDENTIAL campaign with free silver coinage
asNschiet battle cry. is no longer united much
i"sS enthusiastic. in favor Of repeating the
experiment next year. Possibly and even
PROBABLY the free silver declaration OF the
'hcago platform o, 1876 will be Incorporated
'h'o N" Democratic platform Of 1900. but 1t
VIII be supported by tho party with n less near
"rptoach to unanimty than it was in 1886.
"h'n' as W" know, 1t drove thousands Of East
81" democrats into voting for the Republican
T"hu'na'e Tor President and for Republican
representatives in Congress-
~ 10" sam" time" there is not the necessity.
Nn,eh many people insist on. Of making a for
ma incarnation in favor of tho exclusive gold
s'anuard an essential part OF tho Republican
po1'S We have that standard now, in effect
a"" we can b" deprived OF 1t only by an act.
passed hy both houses Of Congress and APP
'''''" 10y Tho President. opening the mints 10
unlimited q II hna