The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1919-01-13
TOPEKA STATE JOURNAL
INFORM ALTON
BUREAU
FREDERIC J. HASKIN. Director.
Washington. d. c.
GoLD-THE LAST DEsPOT.


Washington, D. c., Jan. 10.-A call
| for gold 1ewelry, ornaments and plate
and for gold coin which has been
| boarded, may be necessary as flnai
eXpedient to support the credit OF the
| United States government, unless the
production of gold at the mines is
considerably increased.
In normal times a good deal more
| gold is used in making jewelry and
| ornaments than is coined, and there is
always a large amount of gold IN
| boards in all parts of the world. hut
| especially in Oriental countries where
| the strange love of the yellow metal
for its own sake seems to have an
especially strong hold upon the minds
| of men. If it becomes necessary. the
governments of the principal nations
can take drastic measures to call in
all the gold they need to replenish
| their gold reserves.
For gold they must have. ~Altho
economists are disagreed as to just
what part is played by gold in the
| trade of the world, and altho some
of them think it plays dangerous
and deceitful part, they are all agreed
| that We cannot get along without gold
as a standard of value and me-
dunn of exchange for a long time to
| come. And especially during the
| present time of enormous international
credits, and vast rea djustments of trade
and finance. gold is indispensable. The
| United States, which is now the rich
| est nation in the world and the richest
| nation that ever has been, is in dire
need of gold. AS the secretary OF the
| treasury has pointed out. there must
| be gold in the treasury to support the
enormous credit structure which the
! government has erected and which
must be built still higher to pay war
| debts and finance reconstruction. In
a word, there must be gold in the
| treasury to guarantee the liberty bonds
you have bought and the ones you
Will buy. Gold must soon be sent to
neutral countries to maintain the value
| of the American dollar in them. An
abundant gold supply is an essential to
the great expansion of foreign trade
which is said to lie before US.
The part which gold has played in
the making of modern civiIfza ton is
a strange and romantic one. The
committee which Secretary of the In
| terror Lane appointed to study the
gold situation points out that the
| growth of modern mining dates from
| the time of the great gold discoveries
| in California and Australia. 1t was
| the spell of eager desire which gold
| casts over the minds of men that led
| them to perfect mining methods and
| apply them on a gigantic scale. Later
| these methods, which the lure of gold
| had brought into being, were applied
| to the mining of other metals. and
the enormous production of iron and
| copper, upon which Industrial civiliza-
| ton is founded, followed as a matter
| of course.
! The rise of gold as a standard of
| value also had much to do with the
modern industrial expansion. 1t pro-
| vided a universal unit of labor, which
did not depend upon the fiat of any
! one government. The gold dollar be-
| came, as the committee puts it "a
storage cell of human energy-vita1ly
instrumental in creating confidence
| and unity of action among the work.
ers of different parts of the world"
But while there is no denying the
| great and essential part which gold
| has played and is playing in modern
life, there is good deal of room for
| argument as to the value of gold
standard of value. That it has failed
| to confer q fixed value upon money is
plain enough to all, and has been en-
| phasized by the rapid depreciation of
| the value of money in recent years,
even in the countries which are
| strongest financially, such as the
| United States. Everyone knows that
a dollar which he saved in 1913 is
| only worth about seventy cents to him
now, and the fact that this dollar is
| backed by all the gold in the United
States treasury does not help him.
He also knows that if he increased his
| earning capacity in money by forty
per cent since 1913, he is really get
ting just about as much now as he
was then, for the purchasing power of
the dollar has declined about, or near
| ~, forty per cent in the past six years.
These things show clearly that the
gold dollar is no real or reliable stand
ard of value, and that il works to the
detriment of those who earn wages
or salaries in money. and to the bene-
fit of those who have the real wealth
in the shape of land, mines and COM
modities.
The decline in the value of money
Is ascribed by some economists wholly
to the increase in the worlds supply
of gold while others maintain that
other causes have been equally or more
important. Certain it is that the value
of money has declined steadily as the
amount of gold in the world has in
creased. In Shakespeare time a
couple of centuries before the great
gold discoveries. money. had about
eight times the purchasing power that
it has now.
These doubts as to the value of
gold as a standard of value have led
to the agitation for compensated
dollar or goods dollar" which would
have as its standard of value, not a
certain amount of gold, but a GER
tain amount of all the commodities
used in daily life An elaborate and
brain-wrac king plan for such a sys-
tenn of currency has been worked out
. by Prof. Irving Fisher. and has been
i, pronounced theoretically sound by
many wise men. 1t probably is sound,
too, but the difficulty is to get it
started. Gold is a despot which has
saddled itself upon civilization, and is
so bound up in all our Institutions and
transactions that it seems almost i'm
nossible to throw it off. 1t would re-
: quire an International agreement.
Meantime the great powers are busy
with other things. and there are grea.
national debts to be settled. great ma
tional credits to be floated which
make a standard of value more neces-
sary than ever. Virtually all econo-