Year: 1862

~A
sury notes without and to be made tender
In payment of debts.


In tho first place believe this measure TO be ndispen-
sable to the maintenance of the credit of
Unless its heavy floating debt shall be paid with
BILE promptitude, and its rapidly accrung liabilities pro-
vided for will find difficulty in obtaining supplies
for the army at any price, The delay Of payment that
has already occurred has depressed its certificates OF
debtedness eight or ten per cent


How else shall these immediate liabilities be metz
Three other modes have been suggested-Frst taxa
tion second by the sale Of government stocks to the
highest bidder third by paying the public creditors in
Treasury notes. bearing interest or in stocks These
the only alternatives that have been proposed, and
know of other since the banks have longer
the disposition the to take furrher loans Let
us examine each Of these methods.


The first Is legitimate but unavailable Taxation must
be resorted to- and that literally and promptly but the
proceeds cannot be realized in time in amount suf
cent TO meet tho present emergency The second alter
native would subject the government to heavy loss and
sadly impair its credit assume that nothing short Of
hundred millions will suffice to meet the wants ofthe
government for the present and Immediate future Tho


floating debt supposed TO bo upwards of fifty millions
already and will doubtless reach one hundred millions
before of payment can be provided by any Of the
methods proposed The public creditors are clamorous
Cor their pay and are suffering serious Inconvenience
and loss for want of It, If it is in the power of govern
pay them good faith and sound policy alike de-
mand that 1t should do so with all possible promptude.
To throw upon the market one hundred millions Of gov
ernmen securities to bo sold to the highest bidders in
the present condition Of things with the credit of govern
ment weakened by the magnitude Of its wants. the mar.
ket already overstocked with its seonrities and the cap
tai available for permanent investments almost exhaust
ed could scarcely fail to reduce the price Of six per
cents to seventy cents or less on the dollar Their osz
TO government and this dscedt of its securities must
be avoided If possible, especially when we consider
that these securities would be paid for In irredeem-
able bank currency-a currency in every respect
inferior tie legalzed paper money Of govern
ment. The third named alternative, the payment
of public creditors in interest bearing government secu-
Wnu ha ct Thp a hp r.
ditors receiving them would compel them to sell these
securities to the highest bidder Hence the depres
sion OF price would ensue aud the loss would be
allied but the pccuniary loss in this would fall not
the gove nment but the unfortunate public credit
who relyiu the good faith Of government would
find to their ruin that their confidence had been mis-
placed An alternative producing such results cannot be
entertained for momert Any sncrifcc would be pre-
ferable to such wanton violation Of the public faith


Ii these viows correct, and it, MS believe, thero
other practicable OF meeting the immediate
wants Of the public Treasury foowsl the resort
credit in the form OF circulating notes be
absolute necessity This resort creates capital
rather it transmutes government crodt into money
which Of the most efficient and available forms Of
capital Government thus becomes richer to the extent
the ISSUE without absorbing any OF tho capital OF nd
viduals. that you like most other advocates
of sound currency yield to the necessity CT adopting
this expedcnt with as much reluctance as an invalid
swallows nauseating pill am not of the number.
believe tho aversion to not well grounded but tho
contrary, that the is wise in itself, independent
of its necessity and that it will give better currency
than ever had before Will briefly state the grounds
of this belief.


Money an instrument OF exchange. It's Office is to


the value and transfer the ownership of all pro-
perty offered for Where consists of gold and sill
yer coi its average in all commercial countries Is,
the statistics of money prove about twenty dollars
capita this being the quantity required at the present
OF producing the precious metals to mako the
change of money for other commodities exchange Of
Equivalent equal values If the quantity we're creator
less would not bo true measure OF values If the
money consist Of coin and convertible paper tho aggre
gate quantity will still be twenty dollars rer CAPITA be-
cause tho paner will drive out circulation of
equal tseK So If it consist Of con convertible


arcr and ega!izcd irredoemabe paper its aggregate
w still remain the same since the attor will expcl OF
tho other two amount equal 10 lis issue Hence,
government paper money made legal tender, might be
to tho extent Of SO per ba7d without danger Of
could be kept within that limit would be the best and
most uniform currency known. Tho danger and tho
mischief are IN ranscendns tho limit Of $2o TO one Of
pOpu aon which the proportion that the laws OF trade
award whea the currency consists OF con or Of coin and
| convertible paper.


Estimating the population Of tho loyal States at
reed currency Of $500 900 900. Prior to
thu late bank suspension had Of coin, bank depo-
sis and bank circulation about that amount II is now
mach less because the suspension banshed most
OF tho coin from circulation and also diminished the cir
culston OF bank notes. This leaves fitting opening for
coyornmeat paper money II Is needed to fill the exist
ing vacuum think nearly 500 900 900 would be thus
absorbed without producing sensible effect on prices
the circulation of bank notes. Tho issue OF $780,,
600 900, proposed would however, at first slightly
enlarge the currency aud thus enhance prices but II
would be merely sufficient TO give healthy stimulus to
business and thus enable tho community with facility
and prompude to pay their debts the heavy
which await them And this stimulus would not
be Of long continuance for the government money would
ultimately dspaco an equal amount Of coin aud bank
notes.


Another marked advantage to be derived from the
issue and legazaon Of this money would be its cqua
xation OF tho domestic exchanges and its uniformity Of
valuo everywhere within our borders. This advantage
scarcely bo over estimated in period Of bank sus
pensicn when tho rate Of exchange between different
States and sectos of the Union known by past oxpe
rience to differ 50 widely.


As have said before, the only danger to be appre
houd ed from he n q
svc issue. -Four hundred millions would be tho maximum
limit intended TO abandon both coin and bank cur
rency. Three hundred millions would be the maximum


il intended only to abandon the use OF banks OF de
pot and circulation for hundred millions OF coin
required for change and other transactions under nvt
dollars, below WHICH denomination tho ,*aper money
should moi be is5el. Bat no one desires 70 abandon ou
banking sysem at least not at present to inter
fere nuriousy with bank profits. Their conduct owar,


the government has been most liberal and patriotic
tho government should scrupulousy avoid any lint
Of policy likely to cripple them. For this reason deem


II Improper to issue more than one hundred and hfty


millions Of government money, which would scarcely
curta the discounts circulation Of tho banks while


would greatly strengthen thom by increasing the valc
their assets, including government Treasury note
and bonds. And IL your proposed banking law shall b
adopted, it will greatly facilitate them in conforming


Those are In brief my for urging tho adoption
Of this measure. l have an undoubtirg faith In thei
soundness Our people navo been frightened at govern


luton. That tho abuse OF the system not its
Look at Great Britain, which sustained an almost unin
tsrrupted against Napoleon for quarter Of cen
tury with other money than paper made legal ten
dor, which for most OF that long period nearly a
par with specie, and at tmo more than twenty Ave
per cent discount should prefer constitutional lim
tation 10 the amount Of government paper money but
in ts Absence am confident there Is not the slightest
/ hazard In issuing tho amount proposed.


II is important however that this should be
blended with liberal and prompt taxation. Congress pro
poses raise by this one hundred and fifty mil
lions per annum. should greatly prefer two hundred
millions, and trust you will advise. II Is easier Il
raise that amount by taxation than to borrow IT, fo
taxation compels ecouomy. hope also, that you vii
urge upon Congress the absolute necessity OF prompt
tion on tho Of finance for every days delay
| attended with grave danger TO the public credit.


have written with great haste, and beg you to
| look imperfections. Sincerely yours, -