Year: 1874

A WASHINGTON dispatch Of the 5th inst. says
Senator Jones had obtained permission from
President Grant to publish the following
memorandum prepared by the latter, express
ing his (the President's) views upon the finan-
cial question. The President says:


believe 1t high and plain duty to return
to sspecie basis at the earliest practicable day,
not only in compliance with legislative and
party pledges, but as a step Indispensable to
lasting national prosperity. 1 believe, fur
ther, that the time has come when this can be
done, or at least be begun, with less embar-
rassment to every branch of industry than at
any future time, after resort has been had
to unstable and temporary expedients to
stimulate unreal prosperity and speculation
on a basis other than coin, the recognized
medium Of exchange throughout the COM
mercial world. The particular mode selected
TO bring about a restoration OF the specie
standard is not of so much consequence as
that some adequate plan be devised, time
fixed when the currency shall be exchangeable
for coin at par, and plan adopted and rigidly
ad hered to. 1t is not probable that any legis'
lation suggested by me would prove accept
able to both branches of Congress, and,
indeed, a full discussion might shake my own
faith in the de tails of any plan l might pro-
pose.


jsI will, however, venture to state the general
features of action which seem to me advisa-
BILE, the financial platform on which l would
stand, and any departure from which would
be in q spirit of concession and harmony in
Difference to conflicting opinions:


l. l would like to see the legal-tender
clause, so-called, repealed the repeal to take
effect at some future time, say July /, 1870.
This would cause all contracts made after that
date for wages, sales, etc, to be estimated in
coin il would correct our notions of values ;
the specie dollar would be the only dollar
known as the measure of equivalents. When
debts afterward contracted were paid in cur
rency, instead of calling a paper dollar q
dollar and quoting gold at so much premium,
we should think and speak of paper as at so
much discount This alone would aid greatly
in bringing the two currencies nearer together
at par.


g would like to see a provision that at a
fixed day, say July l, 1876, the currency issued
by the United States should be redeemed in
coin on presentation to any assistant treasurer,
and that all currency so redeemed should be
Cancelled and never reissued. To effect this 1t
would be necessary to authorize the issue of
bonds payable in gold, bearing such interest
as would command par in gold, to be put out
by the Treasury only in such sums as should
from time to time be needed for the purpose
of redemption.


Such legislation would insure a return to
sound financial principles in two years, and
would, in my judgment, work less hardship
to the debtor interest than is likely to come
from putting on the day of final reckon
ing. 1t must be borne in mind, too, that the
creditor interest had its day of disadvantage
also when our present financial system was
brought in by the supreme needs of the
nation at the time.


would further provide that, from and after
the date fixed for redemption, no bills, whether
- ~ mi cd OF
returned to the Treasury to be exchanged
for new bills, should be replaced by bills Of
less denomination than ten dollars, and that
in one year after resumption all bills
of less than five dollars should be withdrawn
from circulation, and in two years all bills OF
less than ten dollars should be withdrawn.
The advantage Of this would be the strength
given to the country against time Of depres-
sion resulting from war, failure of the crops,
or any other cause, by keeping always in the
hands of the people large supply Of precious
metals. With all the smaller transactions con-
Quoted in coin, many millions Of it would
be kept in constant use, and, of
country. Undoubtedly poorer currency
will always drive the better out OF
circulation. With paper legal tender and at
a discount, gold and silver become articles of
merchandise as much as wheat or cotton.
The surplus will find the best market it can.





for coin except to keep it in the vaults of
banks to redeem circulation. During periods
of great speculation and apparent prosperity
there is little demand for coin, and then 1t
will flow out to market where II
can be made TO earn something, which II
cannot do while lying idle. Gold, like any
| thing else, when not needed becomes a sur
| plus, and like every other surplus 1t seeks a
market where 1t can find one. By giving II
active employment, however, its presence can,
| it seems to me, be secured, and panics and
| depressions which have occurred periodically
in times of nominal specie payments, If they
cannot be wholly prevented, can at least be
| greatly mitigated. Indeed, question whether
II would have been found necessary to depart
! frem the standard Of specie in the trying days
which gave birth TO the first Legal Tender act
had the country taken the ground Of no small
bills as early as 1850.


Again, would provide an excess of reve
nue. over current expenditures. l would dc
this by rigid economy and by taxation where
| taxation can best be borne. Increased reve
nue. would work constant reduction of the
| debt and interest and would provide coin tC
| meet the demands ON the Treasury for re-
| demption OF its notes, thereby diminishing
| the amount OF bonds needed for that purpo 81
All taxes after redemption begins should b,
| paid in coin or Unites States notes. This
would force redemption on the nationa
| banks.


With measures like these, or measures
which would work out such results, l see ne
danger in authorizing free banking without
limit.