Gilpin observer., 1916-06-29
SENATOR THOMAS ON
THE FUTURE OF SILVER.

in which he discusses the future of
silver and the important rart it will
play IN the settlement OF the great
debt incurred by European nations in
the present costly war. Sen. Thomas
takes the position that silver will
have to be made a money metal to
enable the belligerent nations to pay
their debts OF else repudiate their
obligations. The Senator writes:
My Dear Sir:
Il have your inquiry of the 9th in
stant regarding the future of silver.
l am not at all confident that my
opinions upon this important subject
are any more valuable than your own
since my premises may be entirely
at fault.
When tie war broke out VEN
tured the prediction that one OF it's
ultimate and necessary results would
be the reestablishnent of silver as a
money metal upon some general and
fixed ratio with gold. did this be-
cause l believed and still believe.
first, that the effect of the war upon
exchange in gold using nations by a
corresponding but more desirable
fluctuation between gold and silver
than it ever had. Second, because
gold would disappear from the cur
rents of trade in all the warning
countries, and silver would very ma
turally fall into the vacuum thus
created, being preferable TO and per-
haps an equally good basis for paper
currency. Third hHd lastly, because
the enormous cost of the war repres-
ented by debt of striking proportions
would necessitate resort to silver as
the only means of broadening khe
metallic basis for money and credit.
II am correct in this forecast. the
intrigues Of the money interests can
only retard their operation; the
movement cannot he avoided.
Il do not thinl0 the moneyed inter
ests have had anything to do with
the recent rise in silver or ITS more
recent fall to 621ac. This Is one OF
the spasmodic fluctuations in the
/ value of the commodity, which are
caused by sudden and temporary de.
mand. l think these are liable to oc
cur from time to time, resulting in a
permanent rise OF the level of mar.
ket quotations. 1t is too early 70
predict a close of the war, and un-
til that arrives, little IL anything will
be done for silver.
when the war ends the total pub.
lie debt of the belligerent and neu.
tral European nations Cwho have
been obliged to be at all times on a
military basis at great expense). will
be FAR in excess of a hundred billions
OF dollars. The annual interest upon
this sum cit five per cent represents
5000 900. 900. which added to the
cost Of government operations will
mean an annual tax upon their pro.
ducing masses of not less than 81.
500 900 900. This is much more
than the total productive wealth. of
the countries concerned, and means
reputation unless silver comes to the
rescue Of gold. Even then, the ma.
tions will have 10 stagger along un.
der an awful load for many years. II
they are ever TO get out from under
IT. Between repudiation and pay.
ment in silver, the holders of these
national securities will prefer the lat
ter. l therefore conclude that the
interests heretofore responsible for
silver's demonetization will be found
among the champions OF thar metal
through the stimulous of self inter
est.
There is no question but that min
ing is still the principal pursuit Of
our people. but the reconciliation of
silver will not alone restore that in
dustry TO its old time condition. 1t
ds the new mining camps and the op.
portunities which they afford that
make states like ours prosperous.
These conditions depend upon wide.
spread ana succe ssful prospecting, a
pursuit which has largely disappear
cd through the extension OF our for.
est reserves and the so-called conser
walton policy of the government with
regard to the public domain. 1t is
true that prospecting can be carried
cn in forest reserves, but the thou
sand and one little rules which fri
tate without CORES ponding benefit
have discouraged the old prospector
more Than the public realizes. Pri
martly then, We must make the public
domain open as heretofore to loca
ton and discovery, and then give tht
industry that encouragement which
liberal legislation always means.
VERY sincerely yours