Evening star. [volume] (Washington, D.C.) 1854-1972, 1935-09-08
BY NEIL CAROTHERS,

BY NEIL CAROTHERS,
Professor of Economics. Lehigh University.
A LMOST Is years ago MIR. New
| ~ ton D. Baker and Mr.. Brand
~ Whitlock, two very smart men,
n sent a joint memorial to Con-
gress urging the coinage of Scent
piece. Mr.. Baker was mayor OF CleVe-
land and Mr.. Whitlock mayor of To-
ledo. It is noted that these two were
able men, with fine minds, so that you
can see Just how mixed on money
questions talented men can become.
They thought that the movement for
municipal ownership of street car lines
would give everybody in this country
a Scent ride. The coins would be
needed for change.
This forgotten incident illustrates
one of the most important facts in
the world. That fact is that no man
has ever lived who could accurately
predict economic developments. That
is what makes economic planning so
risky and economic planners so ridicu-
lous. The two best ''predicterS" the
world has had, Adam Smith and Karl
Marx, have batted about so per cent
so far. When you consider that eco
nonic life is about 100 times as COM
plicated now as in Adam Smiths time
and that our modern planners have
about one -hundredth Of the
mental powers of the absent-minded
old Scotch school teacher, you can
see that when our planners are in
action the mathematical chances that
they will scatter broken pieces over
the economic landscape are pretty
high.
Nowadays the forces governing our
economic life are so inextricably inter-
related that the most innocent eco
nomic measures will, without fail,
cause unexpected reactions in wholly
unforeseen ways The invention Of
tin cans and preserved meats in
America is slowly wiping out cannibal-
ism in far places. The great clothing
industry of our time traces back to
king who did not want to expose
his legs In stockings A scientist played
around with coal tar. and later on a
Central American republic defaulted
on its bonds.
Economic Interdependence.
In no area of economic life Is this
interdependence Of economic activities
more marked than in the field Of
currency. 1t is literally true that the
| history of currency from Hammurabi
to this day is a long story Of monetary
measures that had entirely unex-
pected results. In 1858 Congress
made a petty blunder in q coinage
law, and the entire history of this
nation was changed. Out Of that
little minor error there came the
greenback movement of the seventies,
William Jennings Bryan in the nine
! ties and the silver wolves now run
ming ravenously over our Government.
The history of any nations money Is
fascinating and dramatic story.
And the most dramatic and in
Structive monetary annals Of coun-
try, and the most neglected, are those
Of its small change. Tell the trained
economist what kind of small change
country uses and he can tell you
what kind Of people live in 1t, what
degree Of civilization the country has
Do you recall Mark Twain's story of
his trip to Portugal, where he had
friends to dinner and the restaurant
bill came to 1000 refs and Mark
| jumped out of the window, only to be
pursued, overtaken and told that it
was about S1.15 in Marks money?
Did you know that Aristophanes OBJ
served, 400 years before Christ, the
strange fact that bad money drives
out good, and that Sir Thomas
Gresham gained immortality by ex-
planning exactly the same thing to
Queen Elizabeth about 1000 years
later, and that Congress about 800
years still later passed q statute in
defiance Of Gresham's law and
brought on the fearful depression of
1882 Did you know that in the face
Of the most powerful pressure to
change its clumsy and uneconomic
shillings, pence and farthings Great
Britain has kept its system, appar-
emily on the sole grounds that a
child taught to think in the barbarous
British money will never be willing
to use a sensible currency.
Small Currency History.
Our American small currency his
tory Is veritable panorama Of color,
drama and tragedy, full of strange
incidents and curious facts and extra
ordinary developments. Everybody
knows that way back in the seven
tenth century Massachusetts, colony
set up her own silver coinage mint and
that the mint master gave his daugh-
ter q dowry Of her weight in silver
coins. But few people realize that one
of the causes Of the Revolution was the
stupid refusal of England to allow the
colonies to coin their own change and
her failure to provide other small
coins. For 200 years practically the
| only money of the colonists was
the Spanish peso, divided into halves,
quarters, eighths and sixteenthS, and
ioi tlllS long Time the cOlOIllStS
stubbornly translated this money into
British terms Of pound divided into
twentieths, again into twelfths, and
again into fourths. Not only that but
the different colonies valued the Span
ish pieces as they pleased, so that .
travelling New Yorker, valuing his
Spanish money in New York shillings
and pence, had to translate 1t into an
other valuation entirely when he got
to Trenton, and made still another
count when he got to Philadelphia.
When you smile at q Southerner for
saying two bits" you probably do not
know that this word 'bit," which the
colonists used as the name for the
Spanish half-real or eighth of the
Spanish peso, Is the oldest money term
in America. It is even older than the
term dollar" which the colonists
used universally to describe the Span
ish peso. This the English got from
| the German word "tha1er" corr1Iuted