Year: 1869




based upon what 10 reckoned among men the most
desirable Of possessions, the lands OF the nation.


The failure OF the French experiment OF tle issue
OF substitute Tor money not convertible into gold
ana silver has ever since been faithfully held up ~
every one who atrms that 1t is the law OF necessity
that gold and silver only can be money a. an OK
ample and warning against attempting TO violate
That law and as conclusive evidence OF the impossl'
sty q 50 doing without the inevitable dsprsc,anon
stable, rich, powerful, united, productive and
prosperous, who should venture to have cur.
was the Impression that the French financial sys.
TEN made upon the founders Of our republic.
mine Win such pr precision sn' as those who come
after them may do the causes and eIects OF govern
mental action. they might not then see ~ we now
assignats and mandats OF the French revolution In
inevitably vaueless. Both these forms OF security
icese upon portion Of the lands of the
mobiles and priests OF France called by the rev0lu-
t0nary government the national domain. NOW,
the value OF land to him who claims the ownership
Ii composed OF two essential elements-productive-
ness and title without title the productive value
surance Of title was exactly what the assignat did
not make to the holder. Besides, looking
SsrE upon that time me- encs DO
was not then as. valuable as any other
human possession In France, whether gold,
purchase. The legislator OF to-day was the criminal
Of tomorrow, the judge OF to-day was the cuprit Of
to-morrow; the knife Of the guillotine IKE the rain
OF Heaven, iell alike on the just and the unjust He
who 1T one moment held the asslgnat claiming title
TO the cOnfscated estates at the next had his own
estate c0nliscated with te assignals which he held
Canddly and Justly considered, can Ii be said that
fair argument ought TO be drawn to maintain that
all substitutes for gold and silver as money must be
worthless because the paper money OF France was
valueless when and Wnere nothing was valuable 2
Every student OF the history of our country
win remember that, while vt the organization
OF the government the standard Of value by
law ,o was gold % ana siiyer, yet IN , TACT, TN sne
al nQI n n hut mt
convertible at the WIN OF the holder into com; for
one Of the acts Of the first Congress was TO establish
Bank OF the United States, to issue what was in-
convertible currency, which, as the act reads, Twill
be productive OF considerable advantages TO trade
and industry IN general" the stock was TO be paid
public debt OF the United States, thus making at
that early day the public debt a basis OF three
fourths, ut least, OF the currency Of the United
states.


ANOTHER ADVANTAGEOUS PROVISION.


Another provision which win claim our attention
ments to The 't United states thus giynw ts bills one
value that legal tenders now have. Another pr0vl-
sion Of the bank charter deserving attention was
that while 1t might issue ten million dollars Of circu
latiOn 4 was TO so into operation when four
hundred thousand dollars, or four per cent
Ss S 4 g4a . sa essss xS 9 Ne N sa csns a n sesn Is
hotes, all OF which circulated as money, were never
to be In fact convertible INTO gold and silver But
liable save to the extent Of one-hfth OF the stock
TO which It might become subscriber, NQtWith.
standing the prohibition OF the constitution that no
State should emit bills OF credit the necessities OF
the people Tor money to develop the resources OF
the country was so controlling that every State
tablised banks to issue bills which saould circulate
as money, the basis Of which was noninaliy one
fourth IN specie. In the light in WHICH now view
TINS establishment Of STATE banks they would seem
clearly within the Inhibition OF the constitution be-
cause II Is only patent evasion to allow the
states TO establish bodies corporate, IN which
they were sometimes part owners, to do that which
the constitution prohibited the States themselves
from DONG Thus the creature might and did do
what was prohibited TO the creator. Nor Is 1t sur
pr1sing that this State legislation when examined
by the courts was held within the constitution be-
cause the common convenience and necessity Of the
whole people always have as they always will, SET
aside the written provisions OF constitutional law.


S0ttGs pOoH supreme est iec'' has ever been, 1t
ever should be, the interpreter and complement OF
the constitution The United States Bank failing to
be rechartered In 1911, the country remained with
out any uniform currency, although gold and sill
ver were standards Of value until 1917, when
another Bank Of the United States went INTO
operation, with much enlarged capital for a
period Of twenty years, ana then wound up Its
b the veto OF President Jackson It viii not be use
ful further To advert TO the history OF the financial
legislation OF the country save TO call attention to
the independent Treasury act OF July T. lS40 among
the provisions OF which was enacted that all debts
due TO or from the United States to be paid and
collected IN gold ana SILVER, 80 I,at the currency IN
truly specie. This practice, ~ Is well Known, OBJ
tanned until the war Of the rebellion ana the Legal
Tender act Of February rs 1862 But during all this
time the currency OF the people was paper issued
by the banks secured by various legislative
devices. The actual security for the imme-
onefourth gold and SILVER coin, supposed 10
be IN the banks, but In fact about one-sixth,
the notes and bills Of their CUSTOMERS discounted by
the banks on longer or shorter time or wnat s tech
bank notes circulated as money purportIng to be re-
deeInable in specie ON demand as well the depos
is, which much exceeded the circulation and as the
banks held In fact SO small percentage Of coir 1t is
obvious that these promises could not be 80 redeem
ed SO that whenever the exgencies OF the business
OF country OF the world called for any large
sum- the banks either refused to pay specie or BY
contracting their circulation so diminished the
money OF the country as to bring themselves within
q limit at which their circulation, being necessity
70 the people, would not come IN for redemption.


IL VIII be readily seen that the fluctuations In the
amount ana value o. tne cu,reney caused oy sne
siderable demand IN specie were destructive to all
stability In business enterprises, IL not 70 commercial
integrity itse since once IN every ten years. and
large part OF the time much 0ftener the banks were
Obliged To refuse TO redeem their notes In specie and
from the necessity OF tie case were supported IN SO
doing by legal enactment. No mercantile sagaoIty
in business, no forethought or prudence In invest
ment no integrity Of purpose and no solidity OF
capital in the merchant or conductor OF business
enterprises, public or private, under such q
financial system OF pretended convertibllity could
or did prevent commercial failures and ruin. Every
Few years panics ensued and whole classes OF
solvent prudent, enterprising men were involved In
ruin from causes which 1t was impossible for them
to foresee or control The whole property OF the
country, the scanty provisions Tor the widow and
orphan. the stocks in otherwise prosperous enter
prises, the shares Of public works carried on 70 de-
yelop the industry and wealth OF the country, each
and an ALIKE, at uncertain and irregular periods,
nuctuated in price quite one-haf II this condition
OF things haa been dependent upon the habits oil our
people, upon the productiyeness or nor-productve-
ness Of industries the profitabieness unpro-
ltabeness OF our commerce or business enterprises,
or upon the current enactment OF our legislatures,
either state or national, one or all. perhaps some
remedy might have been found or method OF aevi-
alton proposed. But none Of these had any effect to
hasten or Tetard these fluctuations OF commercial
values The fanit was inherent In financial system.
which was, and while based on money convertible
into specie must continue 70 be, but an exaggerated
osho0t ol the financial systems OF Europe subject
10 the changes, the needs, the wars, famines and
dstresses or other countries. II was In no sense
American system, nor IN any OF ITS parts adapted to
the institutions OF free, enterprsng and independ-
cnt people. Many and various were the expedents
resorted TO by the general government TO remedy
tins chronic vaclation OF money 70 tne destruction
Of che business interests Of the country. But all In
vain.


In the endcavor TO do this the United States a we
have seen, at first chartered bank. became SUBJ
scrsbcr TO its stock aud received and paid out Its bills
AZ money for period Of twenty years. Sthl the
errasic inevitable nnfP