The Caldwell tribune. [volume] (Caldwell, Idaho Territory [Idaho]) 1883-1928, 1923-09-18
The PERIL OF
EDISON-FORD'S
MONEY SCHEME
Would Create More Paper None,
Than Russia'S Trillions But
Add No Real Wealth.
SOME DANGEROUS fALLACIEs
Would Remove Safe Restraint OF Cole
Basis and Open Way to Endless
Issues OF Paper Money.

How the United States would b.
ewamped. under a greater volume o
worthless paper money than hs,
ruined Germany and Russia, by the
Fdison-Ford commodity currency plar
is pointed out in the present article
concluding the reviews. prepared by
the American Bankers Association
OF the recent exposure OF the folly OF
the whole scheme by William I. FosI
ter, Director of the Pollock Foundsl
ton for Economic Research. MrI
Foster says:
THE supply Of money says Mr.
Ford. is inadequate. There Is more
wealth than there is money to move,
IT. He draws vivid picture OF the
golden dam TO the stream OF prosl
perity' From a hundred quarters
comes the demand for the govern
ment to speed up the printing pressesl
in order to crush the money monopo1
w. reduce interest rates. and make
It easier for everybody TO get money
Initiating the currency. however,
though II enables people to get more,
units OF currency. does not enable
power. and It does not reduce interest
rates. In all her history Germany
never had so much money or as high
interest rates as In 1872 Money. UNI
like other forms OF wealth. is not
easier to obtain simply because the
total supply is Increased. On the conf
trary. increasing the supply OF money
ordinarily increases the demand for
money. and interest rates depend not
on supply but on the relation between
supply and demand.
A Dangerous FaIiacy
I'VE are assured. however. that the
Ford Edison plan provides money for
the farmer At virtually no expense to
the government or to anyone else.
All the government has to do Is to
print the money. What could be sim
pier, Here we come to the most dan.
gerous fallacy In the whole project
II Is dangerous because OF the uni.
versal desire to get something for
nothing.
Here Is the gist OF the matter:
Money will buy whatever is produced.
not a particle more by any trick Of
alchemy. or legislation. or finance.
The Russians. having multiplied their
money $4,000 times. cannot buy as
much with II as before. When we
print more money there are no more
goods for money to buy: not a single
additional pillow, OF hat. or potato.
Some OF those who get the newly
printed money can buy more goods
than before; all other people can buy
fewer goods than before, because their
power. Since there are no more
plows, and hats. and potatoes, and
so on. to distribute. IL some people
get more, others must get less.
Imitation under the Edison plan is
limited mainly because. on account OF
It's indefensible discrimination. most
groups of producers of goods and
services are not allowed to partici-
pate. II all groups were included, as
n fairness and IN politics they would
have to be eventually, the possibilities
If imitation would be vast.
The Deadly Spiral
"The total income of the United
States Is now In excess OF fifty bill
ions of dollars. The total money in
circulation, including bank deposits
ubjsct to check, is not far from
billions. II follows that
he annual production, II used as
'asis for new issues on the Edison
Ian. could at once greatly increaseI
he volume OF money In circulation.
very addition to the monetary supply
rould tend to raise prices. The higher
rices became. the higher would be
he loan value OF given volume of
Gods since the size OF the loans is
ased on values and not volume. The
reater. therefore. would be the vol
me OF new money that could be is
ued on the basis OF a given annual
reduction. Prices would become still
igher and so on up an endless
piral
Even In Russia. where financial
rinting presses hold the worlds reel
I'd for volume. where new issues of
70 hundred trilllons OF rubles per
onth stagger the imagination. the
eople com plain that there is notl
Tough money to do business with.
'ithout the arbitrary restraint OF the
I'D basis, and with Muscle Shoals
and sundry other kinds
innstionists constantly pressing
cir claims upon Congress. II is not
all certain that the United States.
ice we'll on the road to financial
Iaos, would in the end be outrun by
issia."