Evening star., 1933-07-24

special articles dtScuSSfng pf0posd1 10
aid debtors by cIeapenino dollors)
YN yesterdays article 1t was shown,
with the aid of the table reprinted
today to accompany this article.
that If the President decided to use
his when, as and If" infiationary
powers to debase the currency and per-
NIT debtors to repay debts in the same
kind Of dollars they borrowed, he would
Immediately face the difhculty Of choos-
ing the amount of debasement that
would do justice to debtors as . whole,
and that different dollar must be pro-
vided for the debtor groups Of each
year. If debtors are to repay in the same
kind of dollars they borrowed.
But If an average of dollar deprecia-
ton could be ascertained that would do
justice to debtors who repaid their debts
last year. would 1t not do an injustice
to creditors the indebtedness to whom
is to be repaid this year or the next?
present trend of the price OF commod-
tiles is upward.
Since We did not upset our fiscal
system and debase the dollar in order
to do justice to the creditors between
1918 and 1921 (who were repaid In
much cheaper dollars than they
loaned), why should we invite per-
manent disaster by debasinE our cur
rency TO do justice to debtors who have
been compelled to pay their debts with
in the last two or three years, or who
must pay in the immediate future?
In any event, the dollar debasement
propositions call for greater degree Of
debasement than is necessary to make
the dollar Of repayment approximately
equal to the dollar borrowed.
If gold content were reduced one-half,
only those who borrowed dollars with
one-half the purchasing power Of to-
days dollar would be justly treated.
The Department of Labor figures (see
cost of living dollar column Of table,
show that in no year since 1913 has the
debtor borrowed q dollar which. to be
repaid In kind today, would require one
half debasement of the dollars value
either by cutting out half of the dol
lars gold content or by paying in. .
cheap silver dollar with silver at 81 to
l. A 16-to-1 silver dollar, Is proposed,
would pay dollar debts with less than
rs cents
What Is An Honest Dollar?
Assuming CONTRARY to fact as shown
by table, that all commodities. includ-
ing those that are essential to sustain
life and the purchase of which consti-
tutes the cost of living, fluctuate in price
in accordance with the fluctuations
of silver as a commodity in relation to
the gold dollar. what Is the honest
dollar" which in relation Of gold to
silver President Roosevelt is to declare
to do justice both to debtors and
creditors?
If the President had been called upon
in 1919 or 1920 to fix the honest dollar
he would have found that the debtors
of 1918, IA, is. who repaid in 1915, II,
'18. '19 or 1920 paid in dollars of far
less purchasing power than the dollars
loaned them. For example, in 1915 the
ratio of gold to silver was 40 to /; in
1919 1t was 18 to and in 1920, 20 to /.
The debtors in those years borrowed
dollars and paid approximately in half
dollars. The aggrieved creditors would
OF twice the purchasing power Of the
cheap dollar rendered them. The years
1921 and 1929, both included, show
slight fluctuations up or down every
year or two, with no great difference
between the lowest ratio and the high
est.
The years 1890, 1891 and 1882 show
steady and rapid increase in the
purchasing power of the dollar, revers-
ing the movement of the period between
1915 and 1919-1920. The recent figures
are for 50 to l in 1890, II to In 1881,
and 73 to l in 1882, rising from 80 to
in 1929.
The debtors who repaid in 1919 and
1920 paid half dollars for dollars: those
who repaid in 1881 and 1882 paid near
ly double dollars for dollars.
But no tampering with the currency
to increase the purchasing power of
the dollar was demanded or granted
to do justice to the creditors of 1919
and 1920. Why should the dollar be
debased by depreciation to q fraction
Of its purchasing power to do justice
(the tables being turned) to the debtors
Of today?
Silver appreciated from 40 to / in
1915 to Is to l in 1919 without the aid
of gold dollar debasement. May not .
similar appreciation be effected today
by regulation of production and the
opening of foreign markets without .
disaster-threatening depreciation Of the
dollar?
Wholesale Commodities Dollar.
Analysis of the fluctuation In pur-
chasing power of the dollar in relation
to sales at wholesale of 784 commodi-
ties shows the same trend of dollar
value, up and down in periods Of years,
as is shown by the fluctuations of the
retail or cost Of living dollar, though
there are variations in comparisons In
detail in the respective years.
For example, If the President in 1918,
1919 and 1920 had undertaken to give