Year: 1879




remarkable Judgment and dexterity in
SO administering defective laws and
SO taking advantage of opportunities as
to make the resumption of specie pay
ments brilliant, even if it is, in some
respects, a Aashy success. The very
defects in the statutes have been conducive
to the Immediate success of his great ex.
pertinent. Had the Resumption act been
sounder and better law the attempt of the
democratic party to repeal it might have
been carried through the Senate, as it was
through the House three years ago, and the
country be still foundering in the Ser
bonian bog of an irredeemable cur
rency. Mr.. Schurz and Mr.. Bayard
were most clearly correct in prin-
ciple in the objections they made to
the Resumption act in the debates which
preceded it's passage. They contended,' Z
with perfect justice and great force of ar
gument, that resumption would stand on q
false and insecure basis if the legal tender
notes were not cancelled when presented
for redemption in coin. The amendment
to the Resumption bill which was pro-
posed by Senator Schurz deserves to be
recalled@and consid dered now. Mr.. Schurz's
amendment was this:-


Provided that not less than two million dollars Of
legal tender notes shall be retired monthly by tho
Secretary of the Treasury and that the legal tender
notes SO retired shall be cancelled and destroyed.
1t is perhaps fortunate that this really
sound amendment was rejected first. be-
cause it would have prevented the passage
of the Resumption act in the then existing
state of public opinion, and, second,
because if the act could have been passed
in that form it would probably have been
repealed before the date fixed for resump-
ton. 1t had a narrow escape from repeal,
even in the defective form in which it be-
came a law. BY lucky concurrence Of fa-
voring events, of which Secretary Sherman
took skiliul advantage, resumption has
been accomplished under one of the most
evasive laws ever enacted on SO important
subject. President Grant recognized the
shortcomings Of the law in the mes
sage he sent to Congress on signing
it, while declaring his great salts
faction in approving any law which set its
face in the right direction. The unsuccess-
full amendment of Mr.. Schurz was clearly
right in principle. Without the cancella-
ton and destruction of the greenbacks
which Mr.. Schurz proposed resumption
is in danger of being like ''the morn
ing cloud and the early dew"-as fattering
and as transient. While gold is flowing
into the country in exchange for our crops
we are likely to go on swimmingly but if
bo 10 cho11 ha hnv 1npf in En-
next year and our own should be deficient
the rainbow radiance of the present situa-
tion might be sadly eclipsed


No clear headed merchant or fnancier
can disguise from himself the fact that we
are entering on new period of imitation.
Speculation is as much stimulated by re-
dundancy of real money as by redun-
| dancy of sham money, as Germany found
to her cost after receiving the enormous
French indemnity. We are retaining in
circulation all the legal tender notes we
had previous to resumption, oil the bank
notes we had previous to resumption,
and, superadded to these, our currency is
expanding under the prodigious influx Of
foreign gold In consequence of this ex-
|
market is becoming not merely buoyant,
but almost wild. These are bad symptoms.
| They should be watched by Secretary Sher-
man with anxious vigilance, for they bode
no good to the country. They portend u
new era Of crazy speculation, to be followed
| by the inevitable consequences of such fits
of commercial excitement and folly.


|
consequence of the original defects of the
Resumption act-dangers which could not
have existed if the Resumption law had
provided for cancellation and destruction
of the legal tender notes Such provision
was successfully resisted in 1875 by the
fears then felt Of distressing contraction
of the currency. 1t was not then foreseen,
it could not have been foreseen, that.
simultaneously with resumption, there
would come pouring into the country a
great tide of imported gold, tending to a
new and prodigious expansion of the circu-
lating medium, an event which is so oppor-
tune and so fortunate that only wise action
by the government is necessary to make it
not only complete security against the
apprehended evils of resumption, but a
guarantee of future stability in our
monetary system. The proper use to
make Of this great influx of gold
is to convey it into the national banks
as a substitute for their greenback reserves,
thereby establishing these institutions on
the most solid and invulnerable basis.
The substitution OF gold for legal tender
notes in the reserves could now be made
banks, and to the great advantage
and security Of tho business commu-
nifty. The greenbacks, having served the
purpose for which they were created, can
now be Withdrawn and give place to gold
without the slightest inconvenience to the