Year: 1875

~ Wv Pu4O4AoEC Va hAo
Eeho by Albert Grant the Jay Gould of
the london Stock Exchange, as prostitu-
ton of Journalism. = ~ y y
SPECIE RESUMPTION WITHOUT SHRINK
--AGK OR CONTRACTION. --


While the discussion of the finances was
confined to Congress, during the last session
of that body, the public exhibited but slight
interest in, the. subject, comparatively.
Now, however, that the politicians have
been transferred from the forum to the
hustingA general interest in the question
has been aroused, and the average American
citizen, be he poor, Comfortably OF, or
wealthy, is absorbed with the belief that he
alone has reached q solution of the dHficul-
ties with which it is surrounded. In this
diversity of counsel it would be strange in
deed if some wisdom should not assert it.
self, and it appears, after all, that ultimate
resumption Of specie payments or return
to specie values is sought for by every one.
except few wild dreaners who would like
to Give in the future" This they think
they can accomplish by continuing the
Government pledges to pay without limit,
and by initiating the currency at the demand
of the hour. without regard to day of set
tlement Happily this class is, as we have
said, not very large, and the masses of the
people, being supporters of the resumption
plan proposed by the Republican party,
are opposed 10 their wild schemes. 1t ap-
pears, however, that the exact method by
which this resumption plan may be accom-
plished is still the subject of discussion.
Horace Greeley's advice that 'the way to
resume is to resume" blunt honest and
captivating as it is, needed supplementary
explanation regarding the details Of that
way. So it is with our Republican plan.
We have agreed to resume at certain time,
and, it is true, have provided for some of
the details; but there is q question whether
those provisions are entirely satisfactory.


The crude idea regarding resumption.is
that it must necessarily be preceded by
contraction and consequent depreciation
Of values. Simply because values have in
creased since the good old times of specie
basis before the war, the general beliefs
that it is necessary to return to ante beIIum
rates This may be true to great extent
as regards the price of labor and the cost of
many of the necessities as well as the luxu-
ries of life but it is not essentially true as re-
CARDS the value of real estate, interpretations
and improvements made thereon. If we
accept gold as the basis of value, it stands
to reason that the basis of value is the same
now as it was in 1860, allowing, of course,
for fluctuations in its price occasioned by
foreign demand for it. This foreign de-
mand is at times greater than others, and
serves to prove that, after all has been said
about it that can be said, gold is an article
of commerce, and is, therefore, not as reli-
able as the public generally accepts it to be
as a standard of valuation. But it is the
nearest approach to that standard that we
can find, and as it is monetized the world
over it will probably remain the basis of
monetary calculations. If, then, we meas
ure the value of real estate by IFS gold price
before the war, or before any given period,
for the purpose of establishing an estimate
of its value now, we doubtless get as near
its solid worth as it is possible. But in
making those estimates we must allow
wide margin for the increased revenue pro-
duced by such property, or the decrease, as
the case may be. This increase or decrease,
calculated upon gold basis, added to or
taken from the value at the period from
which the estimates begin, will show the
exact solid worth of which we speak.
When this solid worth is found, it is neces-


- al,
gold and greenbacks or National
Bank notes to find the current
or generally accepted market price. Now,
if this margin between gold and paper thus
established were to be suddenly destroyed,
or if values were to be instantly contracted
from paper basis TO gold basis, the total
valuation of the resources and wealth of
the country would shrink to an almost in
calculable extent. This shrinkage, it is
estimated, would amount to more than
three times the national debt. To avoid
this calamity, for it would be nothing less
than q calamity, and serious one at that,
is the problem to be solved before specie
resumption is accomplished. If it can be
done without shocking the public or the
destruction of the present equilibrium, it is
manifestly the duty of the Government to
do it in that way.


In considering this problem we must take
into account the absolute necessity for an
additional amount ofcurrency or circulating
medium over the amount in use before the
war, which is occasioned by the changed
condition of affairs. That changed condi-
tioa not only shows itself in the increased
or decreased values of realty, but in the
addition to our purchasing and consuming
population of four millions Of people, who,
as slaves, required but little accommodation
in the way of ready money, but who, as
freemen, now require large amount. In
stead of dressing for example, in gunny-
bag sacks or cotton smocks, they now
wear clothing of the ordinary kind instead
of going barefoot two thirds of the year
they now wear shoes or boots and stockings
the whole year around, and they also wear
hats instead of going bareheaded. Further,
they buy penknives, gewgaws and useful
articles of all kinds as well as those that
are not useful. These facts increase the
necessity of ready money, not only for
their immediate use but for the use of
manufacturers who are called upon to sup
ply this new demand for their products.
In addition to this it must be remembered
that the steady influx of emigrants to
our shores and the natural increase Of
population creates an additional demand
upon the circulating medium, to say moth
ing of the extended use of it occasioned by
the changed and more extravagant habits
Of our people as they grow wealthy, or as
they contract, as thousands of them did
during the war, new habits and appetites
the qualification of which has almost be-
come an imperative necessity. . Is


This explanation of the situation, it
seems to us, will serve as an unanswerable
argument against contraction in any form.
But, while it does all this, it does not re-
move the acknowledged necessity of a re-
turn to specie basis. The necessities for
an additional amount of the circulating
medium which 1t exhibits can be readily