The Bingham County news. [volume] (Blackfoot, Idaho) 1918-1930, 1923-06-01
Expert Shows How Commodity
Money Would Make Worse the
Evils 1t Aims to Correct.
MEANS SPECIAL FAVORS
AND ADDITIONAL TAXES
Would Open Way for Political Med
ding With Business and ComplE
cate tho Conduct Of Trade
and Finance.


the gold standard and do away with
monetary instability, interest charges
and speculation in farm products are
exposed by William T. Foster, Direc.
tor Of the Pollack Foundation for
Economic Research, In an article in
the Proceedings Of the Academy OF
Political Science. He shows that the
only result Of the plan would be to
~aggravate the evils 1t aims to cure,
There is presented herewith the first
Of a series Of articles. prepared by the
American Bankers Association. 70
viewing Mr.. Fosters argument
Tho plan provides, Mr.. Foster ex.
plains. for government built. owned
and controlled warehouses. to which
producers might bring basic commodi-
ties raised on American soil. On which
they wish to borrow money. A gov.
eminent agent would grade the pro
ducer's goods and hand him two
pieces Of paper-a mortgage certid-
cate and an equity certificate.
Tho Edison-For Plan
The mortgage certificate could be
exchanged at any national bank for
Federal Reserve notes up to 80 per
cen of the average value OF the goods
for the previous twenty-five years. In
this way the producer would obtain .
loan of money without mourning any
expense for the use of the money and
he would still own the goods.
His equity certificate Is his evil
dence Of ownership" Mr.. Foster says
HE may keep it, sell 1t OF present 1t
at a bank as security for a loan. He
or anyone to whom he sells 1t can pre-
sent it at any time within a year, to-
gether with the exact amount of mon
ey that has been loaned. and receive
the goods.
"If the goods are not removed with
in n year the Government must sell
them and thus get back the money 1t
has loaned. This is to prevent an &C
emulation of goods and to make sure
that the money will be self-canceling.
As soon as the farmer repays the
loan or the Government sells the
goods an amount Of money is de-
stroyed equal to the amount that was
advanced. This, in all essentials, II
the Edison commodity-money plan.
More Taxes
Most men will be impressed by the
fact that 1t involves additional taxes.
additional corps Of political appoint
ees and a vast extension Of govern
ment control over industry. II the
special privilege of borrowing mon
ey without interest is really a boon
and Is granted only to certain groups
of producers, the list to be changed
from time to time, somebody must de-
eide who are to be the favored
groups, and whether that somebody Is
Congress or Federal warehouse direc-
tors who are subject to partisan ap'
and removal, the question
who is to receive free money will un-
doubtedly remain in politics and Will
r%ecurrently become Of great moment
az election day approaches.
"Mr. Edison contends that his com
dollars will be sounder than
gold dollars because there In the
.warehouse lies the actual wealth, the
things we eat and wear and must con-
to live At first, he says, only
, few basic commodities are to be &C
such as grain, cotton, wool,
rice. legumes, fats, fax and tobacco.
Manufactured articles, he warns us.
will not be satisfactory for this pur-
pose.
IF, then, a warehouse full Of tobac-
% guarantees the soundness Of the
notes issued against It they must be
-edeemable in tobacco. They are, in
act. Federal Tobacco notes. The plan
must provide in like n for Fed
sral Flax notes and 80 or. Further
more. there would have to be ~ many
,i1erent kinds Of tobacco notes as
here were grades Of tobacco. Every
one VIE used money in exchange
would need to have at hand the latest
quotations on all products &C.
.epted for storage, A. they approached
n market value the established loan
,alue. in order to estimate the relative
,alues Of different kinds OF dollars.
Salt Cod Nstss
Everybody would have to observe
carefully whether he had Grade A
xippered Herring notes or Grade K
,aIt Cod notes. II there was a strike
bituminous coal miners he would
,oard Bituminous Coal notes. II there
vas a slump in cotton he would try to
ret rid Of Cotton notes.
Consider, On the other hand, the
iimplicity and defniteness Of a gold
occurred dollar. All the world knows
precisely what is meant by the con
,ertibility Of a paper certificate into
,old. All the word accepts the gold
n exchange. It's value is known iD