Gilpin observer., 1910-01-13
THURSDAY, JANUARY 18th, 1910
WHY THE COST OF
LIVING is HIGHER.

Inc assertion udue Ill lueSe Soi'
ums few weeks ago concerning the
high cost of living, the article went
on TO say that the conditions prevail
ing were due to the country being
on gold basis. This has brought
forth considerable comment and quot
ed extensively. 1t would have been
let go at that, but since there has
been so much said the reason should
be cited.
To come near home. A miner owns
mine. He has no capital. He sells
shares of stock. This produces the
necessary amount to carry on opera
tions. 1t does well for time, then
comes the aftermath. The stock is
outstanding. 1t is debt. There is
nothing with which to buy it in. The
only asset is the mine and that is
practically of no value.
Now, the United States is the
mine, but 1t has plenty of captain
it's good will. 1t, too, offers stock
(bonds) to buy silver and gold. The
people have the bonds and the United
States has the gold and silver. But,
silver became plentiful till its value
deprecated with the aid of demoneti-
zation. Now, there was barely enough
gold so its value was enhanced.
When the government bought silver
at one dollar and twenty-nine cents,
it still owed for that in outstand-
ing bonds. Silver kept falling, until,
alas, today tits worth-all will know
by looking at the quotations of sill
yer.
Not to lose sight of the argument,
the silver is in the position of the
playout mine; only the United States
is the asset, in the other case. The
bonds are good not because of the
silver back of them but the good will
of the government. But it owes for
that silver and the enhanced gold,
too. But the difference between what
was paid and its present value is
debt the country owes the bond hold
ers, and that debt must be paid in
gold, because it is SO nominated in
the bond; meaning all debts of the
government must be paid in gold.
The people are not so exacting but
the foreign bond-holders want all
dealings to be settled for in gold.
That is the meaning of the express
sion the country is on gold basis.
Everything being on gold basis.
due to silver's reputation, the coun-
try must pay twenty dollars an ounce
for it's money, for it's basis of circula-
ton. Heretofore silver was good
enough at $1.29, now "a cents and
none wanted. In other words the
country could get along with bimetal-
lism, and is struggling along now
under a monometallism. To meet this
change of reputation of silver, every
time a bond is issued it must be
paid in gold. Every man and woman
must, then, work twenty times as
hard $4,000, worth of gold) or pay
twenty times as much toward paying
for the gold when bought by the gov
ernment to pay its debts in gold. The
| figures are not exact 1t should be,
the difference between the worth of
silver and the price of gold per
ounce. This working or paying twenty
times as much as formerly is also
figurative, but explains why every
thing is so high. The producer must
exact more for his products because
of his increased tax; the seller must
also exact his pound of flesh, and the
buyer, II he has not had an increase
in wages finds he is living from hand
to mouth.
Now another thing operates to
cause the cost of living more than
formerly. Big corporations. like the
beef trust, and others furnishing the
necessities, have taken over what
formerly belonged to the farm. The
farmer did all the breeding and kill
ing, pretty much. 1t has practically
ceased and the business gone into
fewer hands, who have been able to
charge pretty much what they will
for necessaries.
The last paragraph covers pretty
much the whole field of production.
II the tariff has anything to do
with the high cost Of living, 1t would
be covered by the corresponding high
wages over that paid In free trade
country. That Is, higher wages are
met by high protective duty, which
enables the manufacturer to pay
higher wages in order to keep out
foreign competition by free trade
countries.