Omaha daily bee., 1909-02-07

lINl nAn Q val VI NhN
dangers which Turk behind an inconvertible
currency; but the dangers in which the
country stood OF having to marshal an
immense host for war without adequate
arms, ammunition. horses. accountrements
and supplies, were even greater. The
union, which meant so much not only for
Americans. but for the world at large, had
to be saved. The act of February Is. 1852.
was not the adoption Of a permanent policy,
but merely a choice Of evils"
LincOIn's Ideas on Finance.
Was Mr.. Lincoln in perfect accord with
you on this subject?'
Mr.. Lincoln went further than 1 did," he
replied. HE entertained the notion that
with the triumph Of our arms and the
restoration of peace. the strength Of the
government, the wealth Of its resources, the
extent Of its trade and the prudence of
congress in limiting the issues would be
sufficient to bring the greenbacks to par,
and. provided they we're not excessive, even
to render them worth more than coin Of the
same denomination; in other words, that
under given circumstances a dollar In
irredeemable paper might be worth more
than a dollar in coin. This view was sup
ported by many eminent men in both
houses of congress-"
1T was the opinion of Ricardo MacCul-
loch, Bastiat and other economists" I sug-
gested.
That's all very well" rejoined Mr.. Chase.
but remember that we had to deal with
facts, not with hypothesis. Whilst 1 might
have conceded the theory, 1 denied that the
circumstance rendered Il practicable and In
this the president agreed. There was no
certain way to limit the issues of incon-
vertible notes. Therefore 1 always and
upon all occasions held the convertibility of
the notes in view; and II some people lost
while others gained fortunes through the
decline in the notes and their subsequent
rise in value, 1t could not be helped. For
tune of war"
You say, Judge. that at the outbreak of
the war the bank circulation in the loyal
states was only about $19o,OOO,0O! What
was it in the confederate states?"
Bank Ci~rculatiOn in 1880.
About $40, 10000 % in the southern states
and $4,000, 900 to SIS, OOO.O 900 in the border
states. making the entire paper circulation
OF the country about s1s5, 0,O0o We made
careful inquiries on this subject and the
figures have remained strongly impressed
on my memory. But a mere formal state
ment Of the bank returns can afford no
aueQudLS lued VI luO Q0plOEHDic COhuiNAVh
Of this paper currency. 1 ave here a
memorandum which was prepared by the
treasury for a member of congress who
took part in the debates on the subject.
The whole number Of banks in the United
States, including those in insurrection, was
lap; say, for round figures, 1900. Accord
ing to the 'bGnknote reporters" there
we're of this number only 80 whose issues
were not counterfeited. The number OF
kinds OF altered notes was no less than
1900; of imitation, 1850; and OF spurious
notes, 1,GS0; altogether $50 different kinds
of bad notes. OF the genuine notes there
were over 1000 various kinds-some exc
cuted by good artists, but most of them by
Indifferent ones, so that 1t usually required
an expert to determine whether a note was
good or bad. Even when good, Its value
varied to inverse ratio to It's distance from
the place of issue. Some good notes of the
middle western states were quoted in New
York at only IS per cent of their face value.
and some equally good notes of the south
western states were quoted even lower.
These notes were bought up by brokers,
who sold them at a profit to the employers
of labor. who in turn paid them to work
ingmen at par for, wages. The working
men paid them to the retailers from whom
they purchased their household supplies,
and the latter, in order to recoup them
selves, charged 10 per cent more profit on
their goods than otherwise they would have
been willing to accept. The system was
vicious to the last degree, and, like all
vicious systems. its chief burdens fell upon
the poor"
DO you remember what was the treasury
estimate of gold and silver coins in the
u,hnla ooNInfru ~ the O1fhrRaL Of the ~ 0i
Perfectly. The estimate varied from
$25O,COC,O 900 to $500. coo 1000. of which 800. 10000
were held by the banks. 1t was out Of thi,
500, 1000 that 1 borrowed $50. 100000 for tn,
treasury" s.
Question of National Bank.
WAS, 1t, or is 1t in contemplation to maxi
, the national bank system a stepping stpn'
to a national bank of the United Staes?"
The judge took some time before answering
this question, He rose from his chair, tool
!. a turn or two about the room. then sa
down again and spoke slowly and deAber
ately.
although such was not my design,
was quite conscious that such was it's ten
dency. Was 1t Sully or Turgot who salt
that the structure OF society depended
largely upon its system of money!" I con
Ch0 ZIG AbO " AO~ipiONoit NhSb az
system of money also depends upon tn
. social structure. Now what Is this structur
: of ours? The first words OF the constitution
established IT beyond controversy: We tn
: people OF the United States not the state
: as entities, but the people of all the states
. Such a social structure is national and
inevitably demands a correspondingly ma
y tional system OF money. The ciroulatio
. must fit the organs and vessels which ar
a to carry II an the organs must corTespon
9 TO the fluid which they are to distribute.
n my point Is, Judge. was, the nations
n bank system which you originated designe
. to bring about or to hasten this CORE
d spondence7"
y Neither one nor the other. but rather I
: conform to a correspondence created b
g the constitution. but obstructed by tn
e growth OF corporations chartered by IN
I states and permitted TO exercise the ma
d tional prerogative of money"
Permitted by WhomT"
Here the judge took another turn abou
@ the room.
d In Its National Capacity.
d by tho circumstances which arose GU