The Winslow mail., 1900-01-04
ROAD TO PROSPERITY.
Gold Is insufficient as Monetary
Basis - Prices StilI Down On
the Old Level.

the Oid Lever!
AS prices are still at the same cd
level enforced by the gold standard dur
ing the last few years-although If
anything, the downward tendency APP
pears to be again at Nork-the failure
of increased supplies of gold to affect
the currency discussion is apparent,
and the demand for reconciliation
consequently rests oh grounds fully as
strong as obtained in 1896 and previous
lys for 1t is susceptible of exact demon
Btration that price levels are deter
mined by the ratio between the money
in circulation and the goods in circula-
ton. A single article may decrease
heavily in price because of improved
machinery, but the resultant force set
In motion impereeptibly raises the
average prices of all other articles. AS
an example, if 1000 articles are valued
at $1,000, and an article having value
of one one-thousandth of the totality of
values is lowered in price through ma
chinery by so cents; if the money vol
ume stays unaltered and the supply of
the merchandise is not permitted to in
crease, the isolated reduction issues in
the augmentation in prices of the 999
remaining articles of from $999 to $685.
so, or from an average of one dollar
to an average of $1.0005 per article
Price-levels are altered no less certain
ly by the increase of the merchandise
awaiting money measurement than by
tampering with the money volume;
and it is quite conceivable-nay, prob
able-that the continuous red ction in
general prices has been owiAS ia con-
siderable degree to this cause. Nat as
it is the duty of government to furnish
enough currency, SO that the price
levels may fuctuate no more than i.
unavoidable, the demone etization of sill
yer would be no less reprehensible, even
though an intensifying pressure of mer-
chandise upon the money volume were
to be credited with the entire decrease.
Another proof that the new gold has
been powerless to ameliorate is the
fact that the depression of business
shows no signs of abatement, while we
know that there is not an historical in
stance of a swelling currency circula-
tion concomitant with hard times.
When money is actually becoming re
dundant business is sure to respond
favorably. When prosperity refuses
our solicitations the conclusion is in
disputable that, whatever government
statisticians may proclaim, whatever
may be the prima facie purport of
things, the money that reaches the
people is nevertheless rather on the de-
cline than contrariwise.
Horace Greeley put the matter plain
ly in his remarks in the american
Yearbook and Register" for 1869, say
ing: "The circulating medium of eX-
change and payments being thus in
sensibly drawn away and not replaced,
the Roman empire languished under
growing dearth of money and a steady
decline Of prices. The discovery of
America by Columbus, and the conse-
quent rapid and vast increase of money,
wrought great and sudden revolution.
The energies of civilized world received
an unwonted stimulus and wealth was
increased and comfort diffused as they
never before had BEEN"
People may rest assured that if it
were really the case that the gold late
ly thrown on the market had restored
conditions to virtually what they were
in 1878, the annuitants and those who
profit out of traffic in the yellow metal
would emit such a cory bantic chorus
of disapproval as to threaten the sta
bility of the nations credit. They have
not been silent in the past, when their
interests have been more or less
jeopardized.
The trouble of securing the passage
of the act of 1878, through the kind Of
ficers of Mr.. Sherman, Mr.. Boutwell, and
Director Linderman = was it for
naught? If, as is now maintained, gold
has arrived at point where it alone is
an ample substitute for the silver cast
aside over 25 years ago; and if, as is also
maintained, silver was then legislated
against on account of its supply being
fetal observer that no logical alterna-
tive remains for the defenders of the
gold standard, but to begin a ProPa gar
Ia looking toward the demon e tia ton
of their favorite metal? Is it not clear
8t [HGlF Iat0FI[G HIe[aIi Il II H0[ GI6aE
that, in their inmost consciousness, they
do not believe gold to have filled the
gap formerly occupied by silver?
No guaranty or likelihood exists that
for any long time gold will continue its
present p5'olifcness in yield. All his
tory is against such an assumption.
For thousands of years the precious
metals have been sought out in the
bowels of the earth, and, despite the
scores of sporadic spurts, lasting their
brief day, every such spurt, often
thought sure to be permanent, has
been succeeded by relapse. To look
at a few rather recent illustrations:
The production of gold, after an era of
moderate figures, attained to Sis, 1872
600 fer the ten years 1S01-'10; but
this fell off to $76,063,00O for the ten
years 1S11-'3O, and $94, ,479 900 for 1921
80. In 1S49 came theg great gold dis
coveries and production increased to
such an extent that the annual yield for
the decade ending with 1860 amounted
to nearly $3.50, 1000, 900. This latter fig
ure underwent a gradual diminution in
the following years, until in 1874 the
yield was only $50, ,75O, 600. Another in
crease and another falling off; and now
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