Evening star. [volume] (Washington, D.C.) 1854-1972, 1926-07-31

gued THE assiGnats will draw specie
out of the Golfers where it is now
boarded" His theory was that a.
soon as the hoarders of gold and sill
Yer discovered that paper was as good
money as specie they would be glad to
get rid Of the cumbersome metals. He
had not then learned the now accept
cd rule, known as GreSham's law. that
wherever there are inferior and supe-
riOr money accessible the inferior al.
ways drives into hiding the safer, or
superior.
The paper money, based on castles
and acres. which could not be trans
ported out of France, did not prove
acceptable in foreign countries. any
more than does the present franc.
which. in exchange. is worth only one.
ninth its normal value Yet there
were French statesmen who saw IN
the fact that the assignats were not
accepted outside of France a good
omen. in keeping money at home
forgetting that money is not wealth,
but a mere medium of trade.
1t stimulated extraordinary activity
in domestic commerce and manufaC-
lures, until arrived the stringenCy due
to inability 10 import raw materials
as at present. Then there was a CRY
for new issues of fat assignats, and
within two years, in place of one issue
of 400 100000 there were five or six.
with an aggregate of As 600 900 900
francs, so that only money" was
cheap and all tangible wealth was
dear Worllingmen's wages were not
increased, but their living cost was
inconceivably inflated
Factories closed because with the
persistent falling of money" no sane
business man could dare invest i'm
material or wages. Millions Of wage.
earners were out of employment. The
whole nation. except the real workers.
became delirious i'm gambling i'm fiat
francs. Sugar cost 500 francs pound,
soap $50 francs. a candle 40 francs.
and Mirabeau declared it was better
to hold a mortgage on a garden than
on an empire-ContraSting the as
signats security with that of the good
faith of money based on gold hidden
In a national treasury.
The government tried to bolster the
discredited franc by law, making IL a
crime to refuse TO accept it or TO speak
disrespectfully of it, under penalty OF
several years in Jail under chains. BY
1896 one gold franc was worth 2SS
paper francS-which is a mark not yet
exchange value. instead of being TO
2SS, is / to about o. Yet the assignats
were secured" as mortgages on the
Confiscated real estate.
History records that before tho
end of 1895 the paper money was al
most exclusively in the hands of the
working classes and all wealth in the
hands OF gambling spectators.
X 4
At last the government. in 1896. is.
sued "mandats" based on specific gov.
eminent real estate and forced
loans" and decreed that all assign
ats should be redeemed in mandats, at
the rate of 30 assignats to one man.
dat. and by law decreed that the man
OATS should be recognized as being
"as good as gold" But almost before
the ink was dry on this new fiat
money" its value fell to 5 per cent
of it's face.
That ended the reign of paper in
France, for next came Napoleon Bona
parte, who saved the unemployment
situation by drafting the starving men
into his armies. Then with his vic
tories he levied on the conquered
countries to sustain the armies. Ills
stanchest principle was that he would
pay all accounts in specie. He fund
ed the national debts and made every
payment in cash. In answer to pres
sure from his minister in an emer-
gency to issue credit paper. he re
piled. while I live | will never re-
sort to irredeem&ble paper"
One of the brightest pages in
Frances history is that telling how she
met the crises of the Pruss.an War
of 1870 and the Communist rebellion
with specie payments throughout
Even the United States issued green
backs" after our Civil War. though we
resumed specie payments" in our al
legged Crime of 1873"
(Copyright. 1926. by Paul " CoIIlns.)