The times., 1899-08-27
lstant secretary Vanderlip addressed a

sistant Secretary Vanderlip addressed
long letter to Mr.. Stinson in reply. He
answered the enquiries of the writer as
to the form, use, and scope, as well as
amount of the postal currency issued early
in the Civil War;" and as 10 what, II
any effect a similar currency to be used
simply as a remitting medium and not
for circulation, would have on the finances
of the country
Mr. Vanderlip informed him that the
so-called postal currency and the fractional
currency which succeeded it came into cir
.culation owing TO the financial disturb
ances resulting from the war; which caused
the banks of the country to suspend specie
payments on the 30th of December, 1861
This suspension, he said. involved the Gov
ernment, and in a very short time gold,
which was the principal coin in use at that
time, was forced to premium. This pre-
MUM soon became so great that the sub
sidiary silver coins in circulation were
worth more than their face value, and they
disappeared. The necessity of making
change in daily transactions caused per-
sons in business to issue tickets OF frae-
tional parts of a dollar, and these for a
time were current in lieu of the absent
fractional silver money; but, of course, the
principle was speedily abused. Congress
authorized the issue of postage and other
, stamps as currency, and forbade the cir
cuation of the tickets. Postage stamps
were inconvenient and a supply of the
so-called postal currency was issued Sub
sequently $50, COO, goo in fractional currency
of the same denominations as the sub
sidiary silver coins were issued. In 1876
the circulation of subsidiary silver was re-
vived and the fractional currency was
called in and Cancelled.
Mr.. Vanderlip wrote that the experience
of the public and of the Treasury Depart
ment with both kinds of fractional money
showed that silver was far preferable. Ten
years later the enlargement of the business
of seeds men, publishers, and department
stores gave rise to new demand for frac-
tional paper money. A bill authorizing an
issue was passed by the House in March.
1885, and was sent to the Senate The
Finance Committee of that body asked the
Secretary of the Treasury for some infor-
| nation on the subject and he submitted a
statement showing the relative cost of
coming silver and of printing fractional
paper money and maintaining them in cir
culation. He showed that during the
twelve years in which fractional cur
rency was issued an expenditure of $12.-
0G0,0G0 was necessary to produce it. In
seven years the Secretary said, the Gov
ernment had to print large number of
notes for the redemption of worn-out cur
rency, and the cost of this process alone
in seven years was Sc, 1884 47s The cost of
replacing subsidiary silver coins for the
same period was only $40S9, 11S The ex-
pense of coinage during that time was $751;
600. The bill which had passed the House
was killed in the Senate as result OF this
statement of the Secretary of the Treasury.
Mr.. Vanderlip, in writing TO Secretary
Cages Augusta correspondent, expressed
the opinion strongly that it would be found
/ mn n tfGa fractional
for remittance purposes and not circula-
tion. The money. he said. would neces-
sarily have to be in circulation for some
time before it could reach in legitimate
manner the persons who desired to use it
| for transmittance.