The San Francisco call., 1903-09-03
SHAW DISCUSSES
MONEY QUESTION
Deals With the Coun-
try's Present F'inan-
cial Problems.
Secretary Points Out the
Benefits Of a Ship Sub
sidy Bill.

CHICAGO, Sept. 1.-TWO hundred busi-
ness men from all parts of the country
listened to Secretary of the Treasury
Shaw talk on 1.-The Business Outlook" at
a banquet given tonight at the Audi
torium Hotel by the National Association
of Merchants and Travellers. Lyman ].
Gage addressed the association on the
same subject Just before his retirement
from the Treasury Department and great
interest was attached to the speech to-
night Of the present Secretary. In his
discussion Of the financial question Secre-
tary Shaw declared that what was need
ed was not an elastic dollar, but some
provisions by which, automatically, the
aggregate volume of dollars should in
crease whenever and wherever more dol
lars were needed and would as promptly
retire when not needed. He said in part:
To those who are comparing 1903 with 1898,
and who think history likely to repeat
itself every ten years permit the suggestion
Of few radical differences in conditions. Ten
years ago, whether wisely or unwisely. wheth-
er with or without foundation in fact rea-
son, very large number, and of that number
many close students of commercial and indus
trial conditions believed our then financial
system not only unsafe, but absolutely vicious
At least four kinds of money-United States
notes, treasury notes silver dollars and silver
near depreciation. Grave doubts existed, and
were freely expressed. whether the Secretary of
the Treasury could maintain the parity Of these
forms Of money II he chose. and equally grave
doubts existed as TO the wisdom of attempting
to maintain their parity; Aye. very respect
able number of very good people, and very
spectacle portion of very good public press,
openly advocated the redemption of greenbacks
in silver and the refusal TO exchange gold for
any form of money except gold certificates.
No such doubt or desire now exists. By ex-
press statute il has become the duty Of the
Snrr ~ he Tres tO mai fafr he
parity with gold Of all forms of money coined
or issued by the Government and express
authority is given to negotiate loans, If neces-
sary, for that purpose. other words, the
Secretary of the Treasury is directed TO ex-
change gold for any and every kind and form
OF money coined or issued by the United States
and to bond the Government to the last limit
of his authority whenever such action is neces-
fool who sends his money into hiding
1t is true that very respectable number of
very good people, and In that number desire
TO be classed believe our financial system,
good as it is, might be improved by adding an
element Of elasticity. l do not think there ex-
lists any great number who believe we should
have an imitation. Eight years ago We had
$21 per capita. Now we have certainly more
than $50 and probably nearly $50 per capita.
Conservative business men and conservative
bankers do not generally consider this an in
sufficient normal minimum volume of curren-
cy. I repeat the only criticism now offered
relates to the want of elasticity. Not that a
dollar can be made elastic, but that the vol
of business. OF course the term is a rnisnomer
Elastic material like rubber will expand in
one direction, but 1t contracts in the oppo-
site direction, while the material the volume
is neither increased nor diminished What is
needed Is not elastic dollar, but some pro-
vision by which. automatically. the aggregate
volume of dollars shall increase whenever and
wherever more dollars needed and will as
promptly retire when not needed. .
l wish to suggest a method. and I sincerely
believe the only method by which we will ever
get our share of the commerce of South Amer
lean and South African countries and of the
islands lying south of the equator. The policy
which resulted in creating the commerce of
! the Pacific slope was subsidizfng lines of COM
munCaton with the Pacific slope. When the
| first transcontinental lines OF railway were
| built there not sufficient commerce to pay
operating expenses. to say nothing of dividends
on investments. Few business and fewer
politicians objected to government aid TO trans
continental lines during the development period
OF the commerce along these lines. These rail-
ways need assistance now. No business
man objects to Government aid to the COM
merce of our navigable rivers, and no political
party objects TO large expenditures of non-nav-
lgable streams improvements to rivers and
harbors is subsidy to the commerce of rivers
and harbors. II we ever secure the trade of
will first secure regular lines of communication
with these countries, and If we ever secure
these lines assistance must be afforded. Who
of you, owning a steamship. would divert it
from participation in trans-AtlanteS commerce
where there is much to be done, and send it
on regular trips to countries where have
little or commerce?
Do not misunderstood me. 1 not mourn
ing the defeat of any ship subsidy bill, but
shall mourn exceedingly the defeat Of a bill,
If any such shall ever be introduced, which,
If enacted would insure regular lines OF Amer
lean ships flying the American flag, and carry
ing American merchants and commercial trav-
elers with their wares and merchandise, the
product of American labor, into those countries
IN which | have referred. Such a bill must
offer special advantages to ships plying be-
tween our ports and countries where our trade