Iron County register. [volume] (Ironton, Iron County, Mo.) 1867-1965, 1903-04-09
TINKERING WITH CURRENCY.
Republicans Lay Plans for Expand
Ing the Circulation of
BanknOtes.

Shortly before the senate adjourned
it adopted a resolution authorizing the
committee on finance to sit during the
recess and prepare a bill to meet the de-
mands of the financial situation.
1t is understood that this means a bill
to relieve construction in the money
market due or attributed to the with
drawal of money from the market in
payment of taxes and locking it up in
the public vaults. 1t in reality means
more than that.
The .Aldrich bill, which with others
was killed by senators who gave notice
that they would talk the session out if
necessary in order to accomplish its
defeat, was for the most part a bill
to authorize the placing of public
moneys in banks on deposit in the
treasury of various securities besides
United States bonds. Mr.. Aldrich made
a show of disappointment and displeas-
ure at the defeat of his bill, but that
may have been for effect. as he I'M
doubtedly hoped to secure the passage
of a much more radical measure by the
next congress.
1t is certain that the resolution
adopted at the extra session looks quite
as much to what is called elasticity of
bank note issues as to a measure facili-
tating the deposit of public money in
banks, and it is equally certain that Mr..
Aldrich was at least the prompter of
the resolution.
The committee is preparing for bust
ness, and the Washington correspon-
dent of the Chronicle reports that
sit is pretty well settled in advance
that the bill which the subcommittee"
to be appointed by Mr.. Aldrich twill
prepare will present as its leading fea-
ture some PLAN of expanding the bank
note circulation" The correspondent
adds, however, that there is not the
slightest possibility that the subcom'
mittee will agree to a currency based
OF assets"
The talk is of additional note issue
based on government bonds which it Is
assumed will be issued in large
amounts on account of the Panama
canal and on gilt-edged state and mu'
nicipal bonds. That would be only ar
entering wedge for silver-edged, nickel
edged and copper-edged securities sue
cessively.
Experience has proved to the salts
faction of every reasonable mind tina
there is not even a semblance of elias
ITCHY about a bond-secured currenc.
in the sense in which the word elastic
ity is used in this connection.
Whenever bonds are cheap enough t.
make it pay to use them as security TO
circulation they are so used and the cir
culation is expanded. When the mar
ket price of the bonds rises expansion
ceases. and as it continues to rise con
traction s%upervenes, as it paya to sci
the bonds and retire circulation. Al
this has no relation whatever to til
varying needs for currency for tn
transaction of business.
The result is that expansion of not
circulation with the growth of popula
ton and business can be secured onl,
by continually lowering the grade O
the securities required or else issuin
circulation on the basis of the marke
price instead of the face value of tn
security bonds.
In their pretended anxiety to Civ
the people plenty of currency and
relieve them from the consequences c
treasury lock-ups our republica
J statesmen are strangely blind to tn
fact that the first and most obviOu
thing to do is to stop taking from tn
: people more money than is needed fC
the use of the government honestly an
, economically administered
They show no sign of a purpose
take this obvious step. They knowit
entirely practicable. They know ths
, the contingency of an unforeseen d.
crease of revenues is already provide
for by a provision of law authorizin
, the secretary of the treasury to max
I a temporary loan to meet a deficit.
, With this resource available there
a no excuse for not reducing the govern
, ment income so far that there can be L
lookup to do any harm. So long as OF
! statesmen do not do this we have
right to regard with suspicion the
pretended anxiety about the currenc
, supply.