The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1903-09-03
Leslie vi. Shaw Discusses Many Things
of Interest Bearing the Pros
perity of the Country.
ELASTIC DOLLARS NOT NEEDED
BUT PROVISION SHOULD BE MADE
FOR MEETING EMERGENCIES.
Suggestions for Increasing the Cur
rency in Times of Necessity-Sub-
sidy as Commerce Promoter.
CHICAGO, Sept. 1.-Two hundred business

to Secretary of Treasury Shaw talk on
''The Business Outlook" at banquet given
tonight at the Auditorium Hotel by the
National Association of Merchants and
Travellers. Lyman A. Gage addressed the
association on the same subject just be-
fore his retirement from the Treasury De-
partment and great interest was attached
to the speech tonight of the present sec
rotary. In his discussion of the financial
question Secretary Shaw declared that what
was needed was not an elastic dollar, but
some provisions by which, automatically,
the aggregate volume of dollars would in
crease whenever and wherever more dol
lars were needed, and would as promptly
retire when not needed. His address fol7
lows, In part:
"A representative of large metropolitan
daily recently submitted the following ques-
ton as the basis Of an interview: Has the
boom left the United States richer than II
found it? The honor was declined,
usual, but l could not help contemplating
a few facts.
Compare the following with available
statistics covering any former period and
there can be but one answer to the propo-
sition. Our farms produce four thousand
or their occupants INDECENT? Our five hun
dred thousand factories add ffty-six hun
dred millions in value to three thousand
mllllOn6 OF raw MATERIAL anu tnelT net Jul
put. exclusive Of Implications, is more than
eight thousand millions. Have these hives
OF Industry been consumed by the elements!
Six million operatives in these factories and
workshops annually sign pay rolls aggre-
eating three billions. Have artisans become
paralyzed or have their wages been re-
duced? Our mines quarries, clay banks,
and oil wells yield a thousand millions. Are
these storehouses of wealth exhausted or
their capacity diminished? Our two hundred
thousand miles of railway transport six
x.,flt ~ .yiQ fnol iyh
not including Implications, and pay eight
hundred thousand operatives, exclusive of
officers, six hundred and fifty million dol
lars Are these thoroughfares of COM
merce in the hands of receivers or are they
likely to be?
"As nearly as can be estimated the annual
productive capacity of the American people
is eleven billion dollars. This does not in
clude Implications. This does not include
raw cotton and manufactured cotton; but
raw cotton and the value added thereto in
the process of manufacture. OF this we ex-
port one and one-half billions, and import
a billion of other merchandise, mainly nom
competitive with our own i, produe CT OK we
cent. of all we produce. Not while these
conditions continue will prosperity cease.
WHY WE ARE PROSPEROUS.
1--WE are the most prosperous people in
the world because we both produce and
consume more than others. The little that
we sell abroad, about 10 per cent of our net
production, and the little we purchase
abroad. or per cent Of our net con-
sumption, constitute no challenge to the
statement that our prosperity rests with
ourselves. Unless our factories and work.
shops voluntarily close. or labor voluntarily
refuses employment, or commerce volun-
tarily ceases it's activity, there is no occas-
ion for alarm. Unless apprehension be-
comes epidemic and ultraconServatiSm con-
tagious the immediate future holds for us
as much of real good as the immediate past
has showered upon us.
Ito those who are comparing 1903 with
1893, and who think history likely to repeat
itself every ten years. permit the sug-
gestion Of few radical differences in con-
ditions. Ten years ago, whether wisely or
unwisely, whether with or without founda-
ton in fact or reason, very large num-
Der, and of that number many close stu
dents of commercial and industrial condi-
TONS believed our then financial system
not only unsafe, but absolutely vicious. At
least four kinds Of money-Unted States
! notes. treasury notes, silver dollars. and
gerously depreciation. Grave doubts
existed, ard were freely expressed. whether
tain the parity of these forms of money
il he chose, and equally grave doubts ex-
listed as to the wisdom of attempting to
maintain their parity. Aye; very respec-
very. respectable portion of a very good
redemption Of greenbacks in silver
and sas the ,or refusal to exchange gold
certificates. No such doubt or desire now
exists. By express statute it has become
the duty OF the secretary of the treasury
to maintain the parity with gold OF all
forms of money coined or issued by the
government, and TO express authority is
given to negotiate loans, If necessary, for
| that purpose. In other words, the secre-
tary of the treasury is directed to exchange
| gold for any and every kind and form of
money coined issued by the United
States, and TO bond the government TO the
| last limit Of his authority whenever such
action is necessary to the maintenance of
money into hiding now.
AN ELASTIC MONEY
at is true that a very respectable num-
Der of very good people, and of that number
| desire to be classed, believe our financial
| system, good as it is. might be improved
by adding an element of elasticity / do
not think there exists any great number
who believe we should have any imitation.
Eight years ago we had twenty-one dollars
| per capita. Now we have certainly more
than twenty-nine and probably nearly
| thirty dollars per capita. Conservative
| business men and conservative bankers do
| not generally consider this an insufficient
normal minimum volume of currency I
| repeat, the only criticism now offered re-
| lateS 10 the WdIl Oh eliSllclly. NOT that
/ dollar can be made elastic, but that the
| volume shall be made responsive to the
| demands of business. OF course the term
| is misnomer. Elastic material like rubber
| will expand in one direction, but 1t con-
| tracts in the opposite direction, while the
| material the volume, is neither increased
nor diminished. What is needed is not an
| elastic dollar, but some provision by
! which, automatically, the aggregate volume
| of dollars shall increase whenever and
| wherever more dollars are needed, and will
| as promptly retire when not needed.
| There is now no statutory prohibition
| against the well-nigh inherent right OF
| banks to issue circulating notes This right
| exists throughout the United States but
| subject to a tax of 10 per cent. per an
/ num- This tax is prohibitory. If / were
| given authority to formulate measure that
| would provide the requisite elasticity to our
| present currency system, l think / should
| add an amendment permitting national
| banks with the consent of the controller
! of the currency, to issue volume of cir
cuating notes equal to 50 per cent, of their
! bond-secured circulation, at tax of {
| per cent, the same to be retired at will or
| by direction of the controller, by the de-
| post of an equal amount of lawful money
| with any subtreasury.
FOR EMERGENCIES.
Three things | know. First. this adj
| ditional circulation would spring into ex-
istence almost instantly whenever and
| wherever interest rates advanced TO the
point OF profit. Second II would as prompt
ly retire whenever interest rates became