Year: 1863


paper communication on the subject Of the ma
tional finances from the pen Of Mr.. ELEAzER
LoRD, we'll known as writer on financial topics.
We give place to this discussion because Of tie
great interest and importance atsaeAsg TO it, theme
st the present time and because Of the high repu-
tation which the writer has long sustained by his
contributions the literature and science Of finance


II will be found, moreover, that in stating his
own views as to the most available means for meet
log the existing and impending expenditures Of the
Government in the prosecution Of the war, he has
very succinctly and forcibly exhibited the instant
exaotions which those expenditures make on the
credit and resources Of the country while he shows
the limited range within which, as he conceives,
the Government is left to make its selection with
regard to the financial plan it shall finally adopt.


Mr. Lord, it will be seen, argues substantially in
favor Of the financial policy recommended to the
adoption Of Congress by Mr.. Secretary CHASE. At
all points the theoretical opponent Of the "bul-
lionsts," the writer discards from his view much
Of Mr.. Chase's arrangements as are projected with
reference to speedy, or at least an eventual, re-
sumption Of specie payments. In the idea Of Mr.
Lord, the preciou, metals are simply valuable as
exportable or purchaseable commodities and not at
all as the basis or pledge of sound and uniform
currency The legal tender notes Of the United
States according to his view should be redeeraable
only in the bonds of the United States, which lat
ter be conceives to be sufficient guarantee for the
circulation and currency Of the former. This cur
rency Of secured Treasury legal tender notes would
he argues, be more invariable than gold as stand
ard Of value, because, having but one function 10
fulfil and not having any intrinsic value arti-
ole Of trade or commerce. and not being exportabe,
it, denomination, import, and prerogative as a
measure and expression of the value of other CON-
modities would not be affected by any Of the opera
tions Of commerce The advances in the price of
commodities would be due not to any change in the
value Of the circulating notes, but wholly to the
proportion of supply and demand.


Mr. Lord seems to think that the Government
can draw on its credit almost without limit for the
issue Of legal tender notes. SO long provision is
made for their oonvertibity into or their redemp-
tion by interest-payng bonds Of the United States
We think, however, it will be found that something
more than the making of Treasury notes legal
tender, and providing for their convcrtibility into
interestpaying bonds, will in the end be found es
sental to the maintenance of these notes as ma
tional currency As their circulation is based on
the credit Of the Government, it is obvious that
they must suffer depreciation in common with the
Government, if the latter should cease from any
cause to command the confidence of the people in
its stability, or in its capacity to conduct to sue
cessfu issue the war which nccesstates the present
extraordinary expenditures


The case Of the French Government, in period
Of desolsting war and exhaustiog expenditure, may
be cited as illustrating the connection between mi
litary success and prosperous finances.


About the year 1904, such was the exhaustion
Of the French treasury that Napoleon was able to
form only what he called the chest Of his graade
ormke out Of few millions Of his personal savings.
All the symptoms of speedy and terrible crisis
we're perceptible before he started for Germany.
M. de MArbois, then Minister Of the Treasury,
perceived the evil, and Napoleon was still more
aware Of it, but he saw and sought no remedy but
in victory. A short time before his departure he
said to Count Molten g The finances 60 on ILL., The
Bank is in distress 1t is not here that can set
things to rights" He knew that the credit Of the
Bank at Paris was to be redeemed on the field of
battle in Germany. The issue is thus described
by Count Molten:


After Napoleons departure the difficulties Of the Bank
increased, and the Council OF Regency constantly
occupied with means of dispensing The crowd which de-
manded payment Of s notes No complete uspensias'
took place. but the payment slowly that public
confidence shaken; the notes ceased to circulate freely
and fell TO ten per cent. dscount. M attempt
was made procure bullion from abroad and the crsis
had been becoming every day formidable, iohen
scas rmnatd By the bafts Of Ansfertz ,ohch restored
confidence 10 the nation and enabled the Bank its
ysgpIir payments"


II military successes, vindicating the capacity
Of the Emperor Napoleon to conduct war and
thereby consolidate his power, we're essential to the
credit Of tho French currency at time when it
rested on the basis Of the precious metals, much
more are such successes indispensable to the credit
Of Treasury notes. which depend for their currency
ON the popular confidence in the stability and pros
Perity Of the Government int, whose bonds they
are convertible.


Inc -Hestichc Anzeiger, in commenting on the
emancil alton proclamation Of the President, says


matt