The Denison review. [volume] (Denison, Iowa) 1867-current, 1899-02-21
GOV. SHAW'S ADDRESS
Before the Manufacturers Associa,
ton of New York State.
AN APPEAL FOR ACTION

What Must be Done to Give This Country IA J
stable and Reliable, Yet Flexible
Currency.
Continued from last issue
have an actual instance in mind. In
the fall of 1896 money was scarce in the
west. The farmers were unable to bor-
row money with which to buy cattle for
feeding purposes. A party in South
Omaha came east, formed a syndicate
and arranged to buy cattle from the
ranchers for cash and sell them 10 the
farmers, taking their notes. payable in
Omaha at 10 per cent interest, and Sc
cured by chattle mortgage on the stock
The syndicate took this paper and re-
celyed 10 per cent interest and S100
per head for the steers handled in this
way. The farmers could do no better.
They must have the cattle to feed OF
sell their corn from s to IL cents, and
my Omaha friend made $4,000 III
ninety days besides paying the hig
rate to the eastern syndicate. Who
lost? The producer of cattle lost, for
there was no competition. He had to
sell and he sold for what he could get.
Who lost? The farmer who bought the
cattle for feeding purposes lost He
had u pay the price asked. lie could
not buy from the ranchmen who pro-
duced the cattle, for he had no money
and he could not borrow. Who lost?
] he producer of corn lost Few cattle
being fed meant small consumption
and hence low prices. Who lost? The
consumer of meat lost. Only a limited
number of farmers could be thus &C.
commodated and therefore less than
the usual number of cattle were fed
and the price of meat was proportion
lately high. The same principle runs
through all lines of business and the
same depressing influences are eNerted
upon all industries. Under adequate
provision for an elastic currency what
would have been the result? The banks
would have obtained their increased
issue; would have paid the repaired
charge to the government thereon: the
farmers would have been able to Dor
row at low rates of interest; the men
on the plains would have had com
petitive market in which to sell 70,
cash; a larger number of cattle would
have fed; the producer of corn would
have had a market for his product
while the consumer of beef would have
been in no danger of confronting q
:. meat famine. The only person pre-
JUDGED by the change would have beel
my South Omaha friend and the easter
syndicate.
) A few years ago an organization i.
one of our western states, not in Iowa
j thank God. recognizing weakness il
our monetary policy which it was eyl
IDENTIFY unable TO locate or define, pro
posed that congress should authorize
an unlimited Issue of irredeemabls
paper and loan 1T to the farmers at
per cent. Had our currency system
possessed adequate elements of elias
, ITCHY, it is doubtful ii the condition.
which gave rise to this most visiOnar,
OF all methods Of relief would have ex
listed. The money Of the country woult
have expanded automatically, the ad
dltional currency would have sprune
up wherever or whenever needed, tend
ing materially towards an equal zatioi
of rates of interest between differen
sections of the country.
One of the reasons more generally as
signed and most vehemently urget
against all plans for currency reform
is that it will enable the banks to con
troll our volume of currency. This OLD
lection would be timely if there was
any probability that the banks would
contract The currency at time OF in
locality where it could find employ
ment. l am free to admit that there
are spectators who might be disposed
for personal reasons. to precipitate
panic it within their power. but i
should be borne in mind that banks ant
bankers are not spectators.
No business interests are more de
pendent upon continuous prosperit,
than banking. Ii it were possible TO
the banks toperpetuate favorable hnan
cial conditions every business, every in
dustry, every interest would be safe
The mere scarcity of money invites
withdrawal of deposits to the prejudice
OF the bank, and banks can be relied
upon to do nothing likely to result il
! Withdrawals. Every failure from what
ever cause entails a loss upon some
bank. and for this reason, if for nc
, other, none will do more to avoid bust
ness failures than bankers. Perhaps 3
score of men could be found in thu
: United States whose aggregate wealth
if it consisted Of moneys and credits
would be sufficient to corner American
l1l ~.