Year: 1878

over our land.


GOVERNMENTS can not make money.
They can coin 1t and regulate its
weight and fineness. Labor makes
money. The coin, whether of gold OF
silver, represents certain amount Oi
labor expended in producing 1t. 1t is
used as Il medium of exchange for an
equivalent amount of labor expended
in producing either natural or mechan-
ical commodities. Gold and silver are
selected for this purpose because they
possess the qualities of devisibility and
durability, and are not produced in
such abundance as copper, lead and
iron or other metals. 1t is the labor
the coin has cost that gives 1t Intrinsic
value. 1t represents just so much hard
work, and is used rs the measure OF
hard work in other fields of industry.
Paper money lacks this quality. II
costs no more to print thousand dol
lar bill than it costs to print one dol
lar bill. Hence it can never stand for
a certain amount of labor as the coin
dollar. Hence it is, also, that it will
never be accepted as the equivalent OF
labor unless there stand behind it not
only the pledge but the ability to re
deem it in something that does not
represent the equivalent of labor. Ii
is not in the power of the most absO-
lutte Government in existence to give
to paper money quality that in the
very nature of things it can not pos
sess.


When, therefore, men talk of a Gov
ernment making money, in the sense
of creating it, they talk about non
sense. Aside from coming and regula-
ting the weight and fineness OF the va
rious denominations of coin, it can emit
bills CT credit, or bills bearing interest,
as bonds, or bills bearing no interest as
greenbacks. But what is a bill of cred
it but the Issuing of II note, to be paid
In m0ney-to be paid in the equivalent
of the labor, or the product of labor,
for which it Is accepted? To get its
non interest bill into circulation, the
Government may declare it lawful ten
sier for public and private Indebtedness,
and may thus force it upon the people.
Then it represents nothing more nor
less than forced loan by the Govern
ment, which it is in honor bound to
redeem when il is able 10 do so. It is
the evidence of the Indebtedness of the
Government to the individual holding
the note.


Now if the credit of the Government
is good, the individual may not care TO
demand payment. The notes of the
house of the Rothschild, for example,
circulate MS money among bankers and
capitalists, and may remain outstand-
ing for great length of time. 1t is the
general confidence in the ability of the
house to redeem its notes that floats its
paper. But let there be any weaken
ing of the commercial credit of the
house, and the paper would find its
way TO the doors for redemption with
out delay.


And so it is with the Government.
The credit of the Government of the
U. s. is good, because it has kept faith
with its creditors. 1t has demonstrated
its capacity to mdaage and keep con-
troll of its great debt, reducing its bulk
one-third in thirteen years. Its COM
mercial standing with the world, there
fore, is unexcepti0nable, and will re-
main unshaken 80 long as it redeems
its pledges. 1t has pledged itself to
pay gold and silver on demand for its
notes, after the 1St OF January next.
If it makes good the pledge, probably
nobody will care TO present the notes
ior redemption. They will remain out
just as long as the Government is will
ing to let them remain out, because
the belief of the people will be univer-
sal that it is able to redeem them on
demand If they were absolute money,
there would be no need Ofany prepsra-
tiOn to redeem. Governments do not
redeem their gold and silver coins.
They may change their weight and
fineness, and alter their denomination,
but they don't redeem them, for they
do not create the values they represent.
Labor did that before the coin was ev-
er struck.


But let the Government that emits
bills of credit multiply them so much
beyond its ability to redeem them in
coin as to impair or destroy public con-
fidence, then 40 legal tender legislation
can prevent the immediate deprecia'
tion of the paper; nor, as Mr.. Pendle'
ton has said, can the wit OF man ever
devise any means of keeping it from
depreciation. Down it will go, losing
its purchasing power, and needing
more and more of it as it loses credit,
to purchase anything, and consequent
ly requiring fresh issues to meet the
wants of trade. Hence, every new
batch put out only accelerates the
downward tendency; and unless the
process is arrested, and steps taken to
redeem it ia absolute money of gold
and silver, it will ultimately share the
fate of continental shinplasters, Con-
federate gray backs and other paper is
sues that have preceded them to the
paper mills; and the loss will fall upon
the holders, upon the people them
selves, each cent of decline in the pur'
chasing power of the paper being taken
out of their labor. Hence it is as Dan
lei Webster said, that deprecated
currency il of all human cOntrivances,
the most efficient for cheating the la
boring classes of mankind"


The worlds experience, not less
than the warnings OF statesmen of all
countries, should instruct US to be
careful to limit the paper cbrrency of
the Government to the sum 1t can, at
the option of the holder, redeem In
coin. There is no event in the future
more certain than that if we retrace
our steps, II we indefinitely put off the
day of resumption and double or triple
the amount of the currency of the
Government, it will depreciate, its
purchasing power decreasing while it