Evening star., 1935-02-19
The Gold Decisions.

AL O A4AuVN4LhA 0SAAA,C bA4S NONNAAA-
ment has won victory by the five-to-
four decisions of the Supreme Court
In the gold cases, and in a material
sense the country is for the time being
better off by reason of the decisions.
But victory, in these cases, does
not carry with it moral justification for
the Government in the pursuance Of
its new money policies nor assurance
that those policies will be in the long
run best for the country. I'VE are
not concerned with their wisdom" !"
said the court in reference to the
Governments monetary measures.
1.-The question before the court is one
Of power, not Of policy"
That power, the court held, has
been exercised within constitutional
limits as far as concerns the regula-
ton of value of the Nations cur
rency. The exercise of that power
SuperSedeS, in the case Of dealings
between individuals, contracts Gf they
may properly be called contracts)
stipulating the payment of private
debt in gold. Contracts, however
express, cannot fetter constitutional
authority of Congress"
But, in regard to the Governments
own stipulated agreement to pay its
own bonds in gold, the court found
that the joint resolution of Congress
declaring provisions requiring pay
ment in gold to be against public
policy went beyond the congressional
power" Reputation it was, repudia-
ton it Is and reputation will it con-
tinue to be until the borrowing Gov
ernment has met the terms of its
agreement with creditor citizens.
And here, it would seem, is test of
sovereign integrity which, dismally
enough, will in all probability not be
met. The Government had no right,
legal or moral, that the Supreme Court
could find to justify reputation of its
gold clause. But at the same time the
court gives the debtor National Gov
eminent its way out by denying, in ef-
feet, the creditor citizens right-at
the present time and under existing
conditionS-to recover what was prom
ised and was not paid.
There the matter restS-betWeen
costly integrity and cheap expediency;
between fulhllment of what is sacred
obligation and the practical advan-
tages to be gained by sliding through
the loophole which the Supreme Court
finds now to exist. The odds un-
doubtedly favor expediency.
In a dissenting opinion which con-
tains an extraordinary expression of
moral indignation, four of the justices
unite in the belief that if Congress
may require the holders of obligations
to accept payment in devalued coin,
or promises by the Government to
pay in such coin, then gold dollar
containing one grain of gold may be-
come the standard, all contract rights
fall and huge profits appear on the
Treasury books. Instead of $780,
100000, as recently reported, perhaps
$20,000,000,000, maybe enough to
cancel the public debt, maybe more.
-" We must not forget that if this
power exists Congress may readily
destroy other obligations which pre-
sent obstruction to the desired effect
Of further depletion. The destruction
Of all obligations by reducing the
standard gold dollar to one grain of
gold, or brass or nickel or copper or
lead will become an easy possibility"
That result, the majority opinion Of
the court might agree, is possible.
The court was passing on power, not
policy. 1--WE will not have in the
future any further trouble as far as
constitutionality is concerned in the
enactment of monetary legislation"
Senator Thomas is quoted as COM
menting.
There Is now no protection against
the execution of Just such a policy as
the dissenting opinion pointed out
no protection, that is, outside the COM
mon honesty and common sense of the
American people.
These, one may continue to hope,
are not perishable assets, and in the
end will remain, with or without that
Constitution which Justice Mercy
nolds discovers sis gone"