The Idaho Springs siftings-news., 1921-02-01
SAFEGUARD The
GOLD STANDARD
Continued from page ~


gold output in 1915 and ali esti-
mated Ia. 6 per cent in 1920.
The decrease in gold output in
the United States is mainly due to
the fact that the price of gold is
fixed by law at $2O.67 per ounce.
The price of gold is not subject to
the law of supply and demand
The cost of labor, supplies and
freight increased SO greatly be-
tween 1915 and 1920 that. .gener-
ally speaking, gold mining ceased
to be profitable. A considerable
portion of the gold output always
was obtained on small margin of
profit. When such mines suspend
and fill with water, and equipment
deteriorates, they are likely to be
permanently abandoned. Many
mines have shut down. and others
will follow unless relief is provided.
While throughout the country
the cost of labor and supplies has
started to decline, the gold mining
regions are SO located that this
decline is offset by the 36 per cent
increase in freight rates. Few gold
mines can survive another FIVE
year period similar to 1916 1920,
during which the dollar averaged
a purchasing power of SO cents, as
compared to 100 cents in 1914.
The purpose of the premium is to
compensate for this loss in pur-
chasing power; to bring up pro-
duction, if possible, to the level of
1915. For the process of def1ation
really to solve the problem of
main tanning even the present gold
production, it would have to take
place so rapidly as nearly to para
lyze all industry.
After the close of the Civil war,
deffation proceeded slowly until
shortly before the panic of 1873.
At that time our gold fields, both
quartz and placer, although largely
unworked, were fairy well known
to constitute resources adequate to
the country's need for gold. Since
then, these fields have yielded over
three billion dollars, and the best
deposits are exhausted. There is
less chance now for the discovery
of new gold mines, and prospecting
has virtually ceased because gold
mining is no longer attractive to
capital.
Our present limited resources
are principally low grade ores,
developed at great cost and requir
ing large scale operations. The
mines that are still working are
mostly restricting production to
their best ores. quitting the mine
This is a fatal policy, involving
not only permanent loss of devel.
oped ore reserves, which cannot be
replaced, but the non use anc
scrapping ofexpensive plants whict
the mines will not again justify
building. The end seems SO clearly
in sight that the gold mining
camps are becoming depopuIated
some are entirely abandoned.
The McFadden BILL Fl. R. 13, POI
proposes I'M effect:
/. The collection Of an excise
tax upon all gold articles of do
mestic or foreign manufacture solo
in the United States, this tax tc
be at the rate of $40 per ounce ol
gold contained.
2. To pay a premium to th,
producers of new gold in th,
United States and it's possessions
this premium to be at the rate o
$40 per ounce of such gold deliv
cred to the mint.
3. This tax and premium to b.
in effect for five years.
Since 1873 France has collected
tax on gold used in manufacture
and the arts, and last year great,
increased this tax. No disturbance
to the French monetary system ha
ever resulted.
The McFadden bill propose
nothing that will interfere will
the free flow of cold or CHANGE ID