The Washington herald., 1909-06-20

production OF gold amounts TO $50. ZOO
a year,
a great many men will become rich. ''
Mr. Leach answered
VIII the poor receive any beneft?"
Certainly The poor man IS better on
ia a country where wealth IS increasing
than In a country where wealth is di-
nlinishing- Gold. dug from tie earth.
almost Immediately becomes money. The
more gold, therefore. the greater the
TOlume OF money. And when money Is
good and abundant enterprises multiply.
and labor receives steady work and good
wages"
study OF Economics.
Has the enlarged production Of goId."
I asked, caused a corresponding increase
in The prices Of commodities, including
food and clothing
you are leading me into pretty deep
water Mr- Leach replied The cIassi-
cal economists say that sold and prices
move upward together. They argue that
IL takes more gold 20 buy a bushel OF
wheat when gold is plentiful. or cheap.
than II does when gold is scarce. or dear.
The practical economists. on the other
hard. say that a large supply Of gold,
otherwise large supply OF money. quick
ems industry, expands business. and en-
courages imagination and enterprise.
Meanwhile prices advance. not as a d.
rect result OF more gold. but because
both capital and labor are proftably and
regularly employed. So the doctors IN
economy do not agree
The practical economists. IN illustrat-
ing their theory. point 20 the year 1905.
when prices UUmbled in the United states
and labor was thrown into idleness. al
though more gold was being produced in
this country and elsewhere than AZ any
previous time in history. Arguing fur
ther. the practical economists assert with
truth that the stock Of gold has been
rapidly growing for a number OF years.
II the classical economists were sound in
their reasoning, il would inevitably fol-
low that prices all over the world would
increase, logically and simultaneously.
whereas they are low in the countries
where times are bad and high IN the
countries where times are good.
Capital Is Needed.
without accepting the conclusions Of
either school Of economists" Mr.. Leach
went on to say. let me call attention to
certain conditions and striking contrasts
in the United States as convincing proof
that a large volume OF money stimulates
business and indirectly causes the ad-
vancement Of prices. There was a time
when New York, New England, and the
States or this side Of the Mississippi
River had no capital to contribute toward
the development OF the West Each COM
mmity needed all it had for its own pur-
poses then rode for DAYS between t
and the East. through an arid I
region. seeing plenty Of jack rabbits and I
lizards. but very few men and women. /
AS the supply Of money increased. enter I
prise pushed farther and farther over
the plains and deserts 10 the very foot 1
hills OF the Rocky Mountains. Great irri- I
cation schemes were undertaken. and 4
now. instead Of rabbits. lizards. and desc
atien. I see good roads. automobiles. /
splendid farms and orchards. brick build /
ngs. large towns. and even cities. with
all the improvements and advantages Of I
Dur older civilization
Gold" I said. ''is not consumed Once
coined into money it remains in circula-
lion permanently The worlds stock Is
growing all the time What will happen
when it is doubled or perhaps quadru-
1led?''
4 don't look for a cataclysm, al
.hough the present stock Of gold amount
ng 10 5000 100000 Of which 81. .612, 700 600
belongs to the United States may be null
iplied two or three times Additional
,apital VIII be necessary for new COM
nerce. new enterprises. the development OF
lew countries and the growth or trade
already established. There are economists
Who believe that the stock OF money is .