Year: 1877

lt seems 10 me OF great importance |
that congress should not lose sight of
Its action as operating In a two-fold
and two distinct directions.
IT the United States government were
free from public debt, Its legislative
dealing with the question of silver
coinage would be purely sovereign
and the government be under no re-
straints but those Of constitutional
power. and the public good as affected


by the proposed legislation, but in
the actual circumstances of the nation


with a vast public debt distributed
very widely among our own citizens
and held in great amounts also abroad,
the nature of the silver coinage as af-
fectiDg this relation of the govern
ment to the holders Of the pub
lie debt becomes in any pro-
posed legislation of the highest
concern. The obligation Of the public
faith transcends all questions of profit
or public advantage; otherwise its
unquestionable maintenance is the
dictate as we'll as the highest expedi-
ency, as of the most necessary duty,
and will be carefully guarded by con-
gress and the people alike. The pub
lie debt of the United States to the
amount of $729. .0OO,O bears interest
at the rate of per cent, and SOS, ,000,-
600 at the rate of 5 per cent. and the
only way in which the country can
be relieved from the payment of the
high rate of interest is by advantage
ously refunding the Indebtedness.
Whether the debt is ultimately paid
in gold or silver coin is of but little
moment, compared with the possible
reduction of interest one-third by re-
funding it at such reduced rates. IF
the United States had the unquestion-
able right to pay the bonds in silver
coin the little benefit from that process
would be greatly overbalanced by the
injurious effect of such payment.
If made or proposed against the
honest convictions of the public
creditors, all the bonds that have


been issued since February II. 1873.
when gold became the only unlimited
legal tender metallic currency of the
country. are justly payable in gold
coin, or in coin of equal value. Dur
ing the time of these issues the only
dollar that could be or was received by
the government in exchange for bonds
was the gold dollar. To require the
public creditors to take in payment
any dollar of less commercial value
would be regarded by them as a repu-
diation ofthe full obligation assumed.
The bonds issued prior to 1877 were
issued at a time when the gold dollar
was the only coin in circulation or
contemplated by either the govern
ment or the holders of the bond as
the coin in which they were to be
paid. It is far better to pay these
bonds in that coin than to seem tc
take advantage of the unforeseen fall


of silver bullion. and pay in a new
issue Of silver coin. The power oi
the United States to coin money and
to regulate the value thereof ought
never to be exercised for the purpose
of enabling the government to pay its
obligations In a coin of less value than
that con ontemplated by the parties when
the bonds were issued. Any attempt
to pay the national Indebtedness in 6
coinage of less commercial value than
the money ofthe world would involve
violation of the public faith and
work irreparable injury to the public
credit. 1t was the great merit of the
act of March. 1869, in strengthening
the public credit that 1t removed all
doubt as to the purpose of the United
States to pay their bonded debt in
coin. That act was accepted as q
pledge Of public faith. The govern
ment has derived great benefit from
it in the progress thus far made In
refunding the public debt at low rates
ofinterest. An adherence to the wise
and just policy of an exact observance
of the public faith will enable the gov
ernment rapidly to reduce the burden
of interest on the national debt to an
amount exceeding $50, 600, 900 per an
mum and effect an aggregate saving to
the United States of more than $500,
600 900, before the bonds can be fully
paid. In adapting the new silver coin
age to the ordinary uses of currency
in The every day transactions of life,
and preserving the quality of legal
tender to be assigned to it. consider
alton of the first importance should be
so to adjust the ratio between the sill
yer and the gold coinage which now
constitute our specie currency as to
accomplish the desired end of main
tanning the circulation of the two me-
tallio currencies and keeping up the
volume of the two precious metals as
our intrinsic money. It Is a mixed
question for scientific reasoning and


historical experience to determine


how far and by what methods prac-
ticable equilibrium can be maintained


which will keep both metals in circu-
lation in their appropriate spheres of
common use. An absolute equality
of commercial value from disturbing
fluctuations is hardly attainable, and
without it an untimed legal tender
for private transactions assigned to
both metals would tend to drive out
of circulation the dearest coinage and
disappoint the principal object propos-
ed by the legislation in view. 1 ap-
prehend, therefore, that the two con-
ditions of near approach to equality


of commercial value between the gold
and silver coinage of the same denom-