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- [PUBLIC–No. 214.] " …
An act directing the purchase of silver bullion and the issue of Treaſury notes
thereon, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, That the Secretary
of the Treasury is hereby directed to purchase, from time to time,
silver bullion to the aggregate amount of four million five hundred
thousand ounces, or so much thereof as may be offered in each
month, at the market price thereof, not exceeding one dollar for
three hundred and seventy-one and twenty-five hundredths grains
of pure silver, and to issue in payment for such purchases of silver
$º Treasury notes of the United States to be prepared by the
Secretary of the Treasury, in such form and of such denominations,
not less than one dollar nor more than One thousand dollars, as he may
prescribe, and a sum sufficient to carry into effect the provisions of
this act is hereby appropriated out of any money in the Treasury
not otherwise appropriated. -
SEC. 2. That the Treasury notes issued in accordance with the
provisions of this act shall be redeemable on demand, in coin, at the
Treasury of the United States, or at the office of any assistant treas-
urer of the United States, and when so redeemed may be reissued;
but no greater or less amount of such notes shall be Outstanding at any
time than the cost of the silver bullion and the standard silver dol-
lars coined therefrom, then held in the Treasury purchased by such
notes; and such Treasury notes shall be a legal tender in payment
of all debts, public and private, except where otherwise expressly
stipulated in the contract, and shall be receivable for customs,
taxes, and all public dues, and when so received may be reissued;
and such notes, when held by any national banking association,
may be counted as a part of its lawful reserve. That upon demand
of the holder of any of the Treasury notes herein provided for the
Secretary of the Treasury shall, under such regulations as he may
prescribe, redeem such notes in gold or silver coin, at his discretion,
it being the established policy of the United States to maintain the
two metals on a parity with each other upon the present legal ratio,
or such ratio as may be provided by law. -
SEC. 3. That the Secretary of the Treasury shall each month coin
two million ounces of the silver bullion purchased under the provis-
ions of this act into standard silver dollars until the first day of
July eighteen hundred and ninety-one, and after that time he shall
coin of the silver bullion purchased under the provisions of this act
as much as may be necessary to provide for the redemption of the
Treasury notes herein provided for, and any gain or seigniorage
#. from such coinage shall be accounted for and paid into the
reasury. -
SEC. 4. That the silver bullion purchased under the provisions of
this act shall be subject to the requirements of existing law and the
regulations of the mint service governing the methods of determin-
ing the amount of pure silver contained, and the amount of charges
or deductions, if any, to be made. §§
2
SEC. 5. That so much of the act of February twenty-eighth, eight-
een hundred and seventy-eight, entitled “An act to authorize the
coinage of the standard silver dollar and to re-tore its legal-tender
character,” as requires the monthly purchase and coinage of the
same into silver dollars of not less than two million dollars, nor
more than four million dollars’ worth of silver bullion, is hereby
repealed.
SEC, 6, That upon the passage of this act the balances standing
with the Treasurer of the United States to the respective credits of
national banks for deposits made to redeem the circulating notes
of such banks, and all deposits thereafter received for like purpose,
shall be covered into the Treasury as a miscellaneous receipt, and the
Treasury of the United States shall redeem from the general cash
in the Treasury the clºculating notes of Said banks which may come
into his possession subject to redemption; and upon the certificate
of the Comptroller of the Currency that such notes have been
received by him and that they have been destroyed and that no new
notes will be issued in their place, reimbursement of their amount
shall be made to the Treasurer, under such regulations as the Sec-
retary of the Treasury may prescribe, from an appropriation hereby,
created, to be known as National bank notes: Redemption account,
but the provisions of this act shall lot apply to the deposits received
under section three of the act of June twentieth, eighteen hundred
and seventy-four, requiring every National bank to keep in lawful
money with the Treasurer of the United States a sum equal to five
percentum of its circulation, to be held and used for the redemption
of its circulating notes; and the balance remaining of the deposits
so covered shall, at the close of each month, be reported on the
monthly public debt statement as debt of the United States bearing
no interest.
“SEC. 7. That this act shall take effect thirty days from and after
its passage.”
Approved, July 14, 1890.
( 2 |

Silver,
HDemper Chamber of Commerce
amb
{Board of &rabt.
ANSWER OF
COMMITTEE ON BIMETALLISM
TO PREAMBLES AND RESOLUTIONS
OF
HARTFORD, CONN., BOARD OF TRADE.
T--------. . . . . . . .
45- } / ) lf
SILVER:

D ENVER CHAMBER OF COMMERCE
2’
AND
BOARD OF TRADE.
A NSWVER OF
COMMITTEE ON BIMETALLISM
TO
PREAMBLES AND RESOLUTIONS
OF
HART FORD, CONN., BOARD OF TRADE. Ns WS PRI to r D ENVER.
BOARD OF TRADE.
HART FORD, CONN.
At a meeting of the Board of Trade, held Tuesday, January 17,
1893, the following preamble and resolutions, introduced by Col.
Jacob L. Greene, president of the Connecticut Mutual Life Insur-
ance Company, were unanimously adopted:
tubercus, The abundance and accessibility of silver ores, and
the improved methods of their treatment, have already so reduced
the cost of production that the amount of the metal in a coined
dollar costs on the average less than thirty cents, with every con-
dition favorable for a constant and indefinite decrease; and
tuhereas, Under these condititions, and with silver used only
as merchandise by the principal commercial nations of the world,
its price is maintained at even its present point of depreciation of 24
per cent. in two and a half years, only by the monthly government
purchases of 4,500,000 ounces, for the use of which as currency
there is no demand; and
tubercus, The people of the United States are thus sustaining
alone, for the benefit of mine owners, a silver market which can
stand no longer than it has such artificial support, and which can
never acquire the strength it now lacks to support itself, but must
grow weaker as production continues and cost decreases; and
tubercus, The enormous present storage and the rapid accumu-
lation of this already cheap and cheapening metal represented in our
domestic currency by certificates redeemable directly or indirectly in
gold, have already greatly injured our credit, and are driving foreign
capital out of investments here, to the great impairment of our gold
resources, and tending to raise the rate of interest; and
{U hercus, The time is evidently close at hand when gold can be
retained in Our currency only by repeatedly borrowing large amounts
thereof on the issue of government bonds, to be as repeatedly
expelled again from the currency so long as silver purchases continue;
liegolucio, That we demand the immediate and unconditional
repeal of any and every act authorizing government purchases of
silver; and that we earnestly request Our Senators and Representa-
tives in Congress to use every means in their power to that end, and
until it be accomplished.
tiesoluco, That a copy of these resolutions be sent to every
Senator and Member of Congress of the United States, and to every
commercial association in the United States.
A true copy.
J. M. ALLEN, President.
P. H. WOODWARD. Secretary.
HART FORD, CONN., Jan. 17, 1893.
The above preambles and resolutions being sent to the Denver
Chamber of Commerce and Board of Trade, was, by its Board of
3
Directors, referred to the Standing Committee on Bimetallism, which
prepared the following answer:
Mr. President and Board of Directors:
Your Committee on Bimetallism, to which was referred the pre-
ambles and resolutions of the Hartford Board of Trade, respectfully
submit the following:
On the 17th day of January, 1893, preambles and resolutions
concerning the government purchases of silver under the Sherman
Act, and demanding the repeal of said Act, were adopted by the
Board of Trade of Hartford, Conn., and by its order they have been
gratuitously circulated throughout the country. It is apparent that
the principal object of these resolutions is the unconditional repeal
of all silver legislation, and the permanent and complete demonetiza-
tion of one of the precious money metals of the world.
The city whose chief commercial body adopted and distributed
these resolutions claims to be the wealthiest community per capita
in the Union. Her trust, investment and insurance companies have
their agencies in every city and hamlet of the West and South, and
all our people pay constant tribute to her. Hundreds of thousands
of dollars from Colorado alone annually find their way to her treasury
vaults, and little, if any, ever returns. It seems that having been
enriched by levying tribute upon the developed resources of the
nation, and holding millions of dollars of securities, her citizens are
now resolved to increase the value of their interest-bearing securities
and add to the burden of their debtors by destroying the debt-paying
power of one-half of the precious money metals of the nation.
The Denver Chamber of Commerce, which represents a city of
150,000 people in a State not yet seventeen years old, with a popula-
tion of more than half a million,--the outgrowth of the development
of the mines and productive industries of the “New West,” protests
against this circular of the City of Hartford, challenges the truth
of every assertion of its preambles, and asks that those whose judg-
ment may have been affected to examine the actual facts in the
premises.
The preamble states that the abundance and accessibility of sil-
ver ores, and the improved methods of their treatment, have already
so reduced the cost of production that, the amount of bullion in a
silver dollar costs less than thirty cents to produce it, with every
condition favorable for a constant decrease.
Every thorough investigation of this subject, by those competent
and familiar with it, has shown the falsity of the above statement.
The Senate Committee on Mines and Mining has made a thorough
4
investigation of this subject during the past year, and lately reported
to the Senate that it cost over $1.50 per ounce to produce every
ounce of silver. An investigation carried on within the State of
Colorado, by very practical and able experts, examining into all the
details of the cost of production, shows that every ounce of silver
has cost over $1.30 to produce it in the most prosperous silver mining
state.
The best statistics show that during the large output of gold in
California from 1849 to 1854, it cost $7.00 per ounce to produce the
gold, both the mintage and commercial value of which was $20.00
per ounce. It cost only $11.00 per ounce during the same period
to produce the gold in Australia. – ‘’’ ~ *
This is the period when the silver monometallic party was nearly
as strong as the gold monometallic party has been since 1873. The
silver monometallists then continually protested against the free
coinage of gold, and against its being given a legal tender character
in the payment of debts at the free coinage ratio. They continually
prophesied during that period that silver would go to a premium,
and that it was an outrage to compel those who held the bonds and
other fixed income indebtedness to accept the “cheap yellow” metal
at the free coinage rate which was dug up in California and Austra-
lia “by the peck.”
The facts are, that, with few exceptions, the great bonanza silver
mines which yielded a large profit have been worked out; and that
a large number of mines are now being worked at a loss; and that
the production of silver in this country and the world has decreased
during the past year, and is now decreasing; that high, inspired
hope in the prospector and miner of finding another bonanza causes
millions to be spent annually in unrewarded research for, and the
development, of non-paying mines. -
A large part of the gold product comes from silver and gold ores.
A very large part of the lead product of this country is desilverized
lead from the wet silver ores. Quite a percentage of the copper pro-
duced comes from silver-copper ores.
The misrepresentations, upon this subject are well illustrated by
the statements made from 1874 to 1878, regarding the output of
silver from the Comstock bonanzas. It was published as a fact all
over the East and Europe that the immense quantities of silver
bullion those mines would produce would make silver so cheap that
its demonetization was a necessity; when the truth and the fact was
that the Ores from the Comstock bonanzas was 45 per cent. gold and
55 per cent. Silver. This fact was established and reported to the
Senate by the Silver Commission.
5
The history of the free coinage of both metals for one hundred
years shows that the proportional amount of the product of either
metal does not change the price or bullion value. At the period of
the great output from the silver mines of South America, and par-
ticularly the Potosi mine, the product was approximately 75 per
cent of silver to 25 per cent of gold. For ten years after 1849 the
product of the precious metals was about 75 per cent. of gold and 25
per cent. of silver. During both these periods the ratio of value
between the two metals was 15% to 1 the world over. When free
coinage of both metals exist, the relative proportion of the product
of each, or the cost of production, has no effect upon the price of the
bullion. Of course, the quantity of both the precious metals produced
and coined affects their value or purchasing power, but not the
price of the bullion. That is absolutely fixed at the mintage price.
The resolutions state that silver is only used as merchandise by
the principal commercial nations of the world. Is this statement
true? France alone has seven hundred millions of legal tender silver
in circulation, and over one thousand millions of gold, and the mono-
metallic nations of Europe cannot prevent the continued augmenta-
tion of gold in France; and yet these resolutions repeat the oft
disproved statement that our legal tender silver will drive gold out of
the country.
The Chancellor of the English Exchequer, Mr. Goschen, in a
public speech shortly after the Baring gold panic, said that England
would have been probably compelled to suspend specie payments
had she not been able to borrow fifteen millions of gold from the
Bimetallic Bank of France; and said, further, that the only countries
during the last ten years that had not been continually troubled
with the scarcity of gold, leading to gold panics, were the countries
that had a large bimetallic circulation of both gold and silver. When
the Bland Bill was passed in 1878, there was not over one hundred and
fifty millions of gold in the country. It was continually prophesied
that the coinage of two millions of silver a month would drive the
gold out of the country, but it was continued until we had over six
hundred millions of gold.
There is in the world about three thousand millions of gold and
about three thousand millions of silver utilized for money purposes.
Statistics (compiled with the light of many historic facts generally
ignored) show that the specie money of the world is not over six
thousand millions. The Hartford Board of Trade, following in the
line of the historic monometallic party for the last one hundred years,
demands the demonetization and the destruction of the debt-paying
power of three thousand millions of this money. That is the issue
6
before the people. Those who do not know that this would approxi-
mately double the value of all fixed income securities, and other
indebtedness, and depreciate 50 per cent. the value of all property
and productive industries, are ignorant indeed of the history of this
most important subject. An ounce of silver bullion at its market
Value will to-day purchase as large a quantity of the fifty staple
articles that give man a comfortable existence as it would when it
was worth $1.29 per ounce, because free coinage existed and that was
the mintage price. On the other hand, an ounce of gold bullion will
to-day purchase about 33 per cent. more of such staple articles than
it would in 1873 when silver was demonetized. So gold has risen in
value, but silver has not fallen in value. The gold price of silver
bullion has depreciated on account of demonetization by repealing
the free coinage laws. If the silver monometallists had succeeded
in stopping the free coinage of gold in 1852 in the Latin Union, as
they did in Holland, the bullion price of gold would have fallen to
fifteen, and perhaps to ten dollars an ounce.
These resolutions declare that the Sherman Act is driving gold
out of the country. During the fiscal year 1892, the imports of gold
were S50,162,879, and the exports, $50,305,533. So we lost during
that fiscal year S142,000 in met exports. Our mines produced over
$33,000,000; so the country gained over $30,000,000 of gold during
the last fiscal year of 1892. The monometallists of the East are the
men who cause all the exports of gold from this country. They
have made their immense fortunes by selling in Europe railroad and
other bonds, the principal and interest of which is payable in gold
coin. When European banks, or other institutions, find it necessary
to increase their gold reserves, they send these securities to New
York, and they have to be purchased in gold and paid for in gold,
which is exported. Were it not for this, there would be a continual
large flow of gold to this country, because the balance of trade is
largely in Our favor. No law or financial policy can be devised
which will prevent Europe from taking gold from us with these
securities so long as we remain debtors.
The people of the West and South ask no protection from the
government. The silver miners ask no protection for their
silver mines. They opposed the adoption of the Sherman Act. It
was brought about by monometallists on the conference committee.
They only ask the restoration of the law as it existed before the
crime of 1873. The farmers of the West and planters of the South
lose over five hundred millions per annum on their crops by reason
of the demonetization of 1873. It takes thirty to forty per cent, more
of their products to pay every dollar of interest or principal on their
7
mortgages since the country has been placed on a monometallic
basis by the policy of the Treasury and the practical demonetization
of silver. They demand that the one thousand millions of both
gold and silver money in our country shall constitute the legal tender
money of ultimate payment. They demand that the statutes passed
by the Congress of the United States, which makes silver equally
with gold such legal tender money, shall not be nullified. They
demand true bimetallism. They are as much opposed to fiat paper
money as the monometallists of the East and Europe. But they
believe that if a monometallic policy is forced upon the country,
the scarcity of gold will increase until fiat money schemes
will endanger the credit and prosperity of the country and of the
nation. If danger of the latter besets the country, the policy of the
gold monometallists will be wholly responsible for its bad results.
C. S. THOMAS,
G. G. SYMES,
For the Committee.
/Čepriſiſed ſºom //e BANKER'S MAGAZINE, Feb., 1891.
THE CHAMBER OF COMMERCE OF NEW YORK,
UPON FREE SILVER CO!NAGE.
ADDRESS OF JOHN JAY KNOX.
ALSO -
“THREE PECKS TO A BUSHEL,”
FROM
The Journa/ of Commerce.
A special meeting of the Chamber of Commerce was called upon
January 12, 1891, to receive the report of the Committee on Finance,
composed of George S. Coe, President of American Exchange National
Bank; John Jay Knox, President of the National Bank of the Republic;
John Harsen Rhoades, President of Greenwich Savings Bank; and Wm.
P. St. John, President of the Mercantile National Bank.
The report, signed by the first three gentlemen named, was submitted
by Mr. Coe and adopted. Subsequently, the following resolution, intro-
duced by Mr. Alexander E. Orr, was also adopted :
Resolved, “That it is the judgment of this Chamber that until a uni-
form coinage ratio between gold and silver is adopted by the commercial
nations of Europe and the United States, the passage of an act of Con-
gress, and its approval by the President, authorizing the unlimited free
coinage of silver dollars of the present standard would result in forcing
United States gold coin into an article of merchandise, thereby with-
drawing it from circulation, and contracting the money of the country
more than one-third of its present volume.”
There was a full attendance of members.
Mr. John Jay Knox made the following address:
“I have heretofore refrained from discussing financial subjects before
the Chamber of Commerce, considering that being but comparatively a
new member of this body the time should be allotted to older members,
whose experience as merchants entitles them to the floor. I take this
occasion, however, to thank the Chamber for the honor it has conferred
upon me for four years in electing me a member of its Committee on
Finance. For I know of no honor which can be prized more highly by
2 JOHN JAY KNOX ON THE SILVER QUESTION.
an officer of a bank than to represent the merchants of New York upon
the Finance Committee of the most important business organization in
North America.
“The questions before us for consideration, in addition to the propo-
sition of the Secretary of the Treasury for an interchangeable currency,
alre : -
“ (1.) The bill now pending in the Senate which has been reported
from the Finance Committee. -
“(2.) The amendment of Senator Stewart providing for free coinage
of silver.
“(3.) A substitute for these measures in a bill introduced by Senator
Plumb in the Senate, which bill was prepared by a member of this
Chamber. t
“The bill reported from the Finance Committee of the Senate by
Senator Sherman and now pending in the Senate, contains some excel-
lent features. First, the bill provides for the refunding of 200,000,000 of
United States 4 per cent. bonds into 2 per cents. All of the 4% per
cent. bonds which mature in September of the present year are now pay-
able, principal and interest, at the Treasury Department, and after the
payment of these bonds in September next there will be no United
States bonds left unpaid except the 4 per cents, which are not payable
until October 1, 1907. If the present 4 per cents can be gradually
refunded into 2 per cents and the difference in value paid to holders,
the Secretary will have an outlet for his accumulating surplus in the
payment of such differences. The borrowing power of the Government
is so low that the exchange of the 2 per cents for the 4 per cents can
be so arranged that the exchange will be a great benefit—a profit—to
both parties, and it will complete the refunding of the debt which was
commenced at the close of the war in 1865 and was continued to the
issue of the 4 per cents.
“While our Government has neglected to continue its system of
refunding, owing to the difficulty of obtaining legislation, the English
Government, taking the action of the Treasury Department in this
country as a model, has refunded $2,800,000,000 of its debt into 2%
per cents, with a contract for refunding into 2% per cents, thus
availing itself of the opportunity of placing its large debt at the lowest
rate of any great nation. We have allowed England to steal from us
our glory, to grasp the opportunity which was Open to us, for we could
easily have funded the whole of the 4 per cents into 2% per cents, seven
years ago, when the 4 per cents could have been purchased at I 5 per
cent, premium. . These bonds could be readily placed in the market if
the banks were authorized to receive them as a basis for circulation.
But even if the banks were not authorized to receive the bonds, such
legislation would be excellent.
“The Senate bill provides for reducing the amount of United States
bonds which the National banks are required to keep with the Treasurer
as security for their circulating notes. The advantages of a bank circu-
lation over the inelastic, the cast-iron issues of the Government are
well known to all financial men. We had the best system of paper
currency in the world for a country like this, when it was equally
divided between the greenbacks, which were the issues of the Govern-
ment, and the issues of the National banks; but the prejudice has
become so great against National bank issues that these institutions
have long since given up all expectation of Continuing to issue circulat-
ing notes. Instead of asking for an increase of notes, they urgently
request that Congress will give permission to retire their notes now in
circulation, and a bill has been pending in Congress for the last four
FREE COIN A G E IN 'I HE CHAMBER OF COMMERCE. 3
years allowing each bank to reduce its circulation to $4,500, and per-
mitting National banks hereafter to organize upon the deposit of
$5,000 of United States bonds. This request is certainly most reasonable,
and would gradually retire the notes of banks and make room for the
silver issues which have already been authorized. The only reason
given for not complying with this request is that a large reduction of
the bank circulation may bring about contraction ; but a section in the
silver law, which was passed during the last session of Congress,
provides that upon the retirement of National bank notes by depositing
lawſul money in the Treasury, the Secretary is authorized to purchase
United States bonds with the money thus deposited.
“With this law enforced no possibility of contraction can follow until
the notes are returned to the Treasury for redemption. The process of
redemption is very slow. November 30, 1889, there was $70,000,000 of
lawful money on deposit in the Treasury for the retirement of National
bank notes, but only $17,000,000 of these notes were presented for
redemption during the entire year. During the month of November
last less than $1,500,000 were presented, while nearly $5,000,000 of new
silver Certificates or notes were issued.
“Banks should have the right to surrender their circulation and
deliver their bonds to the Secretary for sale. All moneys deposited in
the Treasury for the purpose of retiring National bank notes under the
law passed during the last session of Congress can be immediately
invested in Government bonds, so that if all the National bank notes
should be returned in three years there would be no contraction, and the
Government would save a large amount of interest upon its bonded debt.
“The whole amount of National bank notes now outstanding is less
than $180,000,000. If Congress should give the banks permission to de-
posit lawful money and return all of the National bank notes now out-
standing, it is not probable that $60,000,000 of these notes would be re-
deemed during the next three years, and during that time at least three
times that amount of new silver notes would be issued. Judging from
the experience of the last fifteen years, a considerable portion, probably
one-half, of these notes would not be presented for redemption during
the next ten years; and at least $15,000,000 will never be presented,
which amount will be a net profit to the Government.
“If Congress should give the banks the privilege of retiring their own
notes, which are now issued not with profit, but at a loss in many cases,
the operation would have the effect of reducing the value of the bonds
in the market, which the Secretary is continually purchasing. But the
prejudice in Congress against the banks has been so great during the
last five years, that while on the one hand Congress will not allow the
banks to issue circulation at a remunerative rate, on the other hand it
will not even allow the banks to retire the circulation, which is issued
at a loss. -
“Another section of the bill authorizes the purchase of additional
silver and the issue of additional silver certificates. In my opinion, no
additional paper currency is needed at the present time. During the
last twenty years the circulation of the country has been nearly doubled;
during the last year nearly $100,000,000 has been added to the circulation.
It is true that during the last three months there has seemed to be a
scarcity of currency. It originated in the fact that the people of this
Country prefer paper currency to coin, which is abundant; that small
National bank notes have been rapidly retired, and only large notes
issued in place thereof, and that while Congress authorized a large ad-
dition of silver certificates during its last session, it did not give the
Treasury the facilities for furnishing small notes to the banks for use in
4 JOHN JAY KNOX ON THE SILVER QUESTION.
the fall, business. There was, therefore, a temporary deficiency. But
the banks in the West and South are now full of these notes. The fall
business is over, and there will be no urgent demand for a large portion
of these notes again until the fall season of 1891. The silver certificates
are rapidly being returned to the large banks in the cities.
“When National bank notes are returned in excess, they can be sent
to the Treasury for redemption, where they are redeemable in legal-
tender notes, and these notes can be converted into large certificates,
which can be held by the banks in the large cities for Clearing House
purposes, or they can be returned to the Treasury and be redeemed in
gold. But the silver certificates, which are being returned in large
amounts, have but one outlet, and that is by the return of the certificates
to the Government in the payment of its dues. The paper circulation of
the country is abundantly sufficient, and if not sufficient, the addition of
$60,000,000 in the bill already passed during the last session of Congress
will supply every possible deficiency.
“It is now proposed by Senator Stewart, before the effect of the act
of the last session is known, providing an addition of $60,000,000 of
silver certificates, to authorize the conversion of all the silver bullion
which may be presented at the mints into paper currency
“The issue of a large amount of additional silver certificates now, after
the fall business is over, and the produce of the country delivered at
the home and foreign market, may be compared to the purchase by a
large railroad corporation of thousands of freight cars for the movement
of freight after the principal freight business of the year is over. The
cars would be of no use whatever; they would be worse than useless,
for they would obstruct the business of the road. They must be placed
upon side tracks and await the revival of trade or the growth of business,
or sold to other corporations at a considerable loss both of interest and
of principal. The freight car is a medium of transportation, the cur-
rency a medium of exchange. The wealth of the country consists not in
its coin and currency, but in its great resources—its houses and lands,
its railroads, its fences, and other improvements; in the grain and cotton
and wool and hay and rice and cattle; in its ores and lumber and coal ;
in its immense amounts of raw material and manufactured goods, which
are the result of the industry of millions of people.
“The freight car and the currency are nothing but the machinery—
the tools—for moving the freight and developing the business of the
Country ; and it is as foolish to invest large amounts of capital in silver
that we do not want, as for a railroad company to manufacture a hun-
dred thousand freight cars to move the produce of the country when one-
tenth of the number would be more than sufficient for the purpose. It
is as Culpable for a great nation as for a corporation to purchase a com-
modity it does not need.
“The Country had an excellent and economical circulating medium
before the purchase of silver in such large amounts was commenced.
It does not need any additional legislation for this purpose. The silver
hereafter produced should be sold in the world's market for gold, or ex-
changed for some other product which we need even more than gold.
“He who advocates the gold standard is the true bimetalist, for he is
earnestly in favor of using as much silver as can be used, and maintain
gold payments. *
“He who advocates free coinage is the true monometalist, for free
coinage of silver will drive the gold, except that held as a reserve by the
banks, entirely out of use, substituting temporarily loan certificates and
Other paper issues for money in place thereof, until finally our standard
of value shall become the same as the standard of China, Japan and
India, instead of that of the advanced nations of Europe.” -
FREE COIN AGE IN THE CHAMBER OF COMMERCE. 5
After discussing briefly the proposition of Mr. St. John, which was in
favor of free coinage, coupled with the issue of Treasury notes based on
forty per cent. of reserve, composed of equal parts of gold and silver
coin and bullion, Mr. Knox said :
“Two months ago it was believed by many that it would be
desirable to increase the paper currency of the country. The finan-
cial crisis is over. We have now to deal with its results. The
currency is being withdrawn from its hiding places; 'it is returning
from the West and from the South, and the vaults of the banks
during the next few months will hold too much, rather than too little
paper money. What the country needs most of all at the present time
is rest. It needs to recover from the financial shock. The discussion
of the currency question tends not to revive, but to impede and unsettle
business. Capital is timid, and many persons believe that free coinage
will bring gold to a premium. Even if they are mistaken, the result will
be the same. If free coinage is imminent, gold will be withdrawn from
use and hoarded, and every dollar withdrawn has a bad effect. If Con-
gress would dismiss from its consideration the subject of the currency
the country would be relieved.
“The Chamber of Commerce believe in the best money, the world's
money. It has no prejudice against gold ; it has no prejudice against
silver. A ten-dollar gold piece contains 258 grains of gold. If ten of
these pieces are melted into a bar of gold, that bar of gold will buy
$100 worth of goods the world over. But if Loo silver dollars are
melted into silver bars they will purchase in China and Japan and
India, countries upon the silver standard, only about $80 worth of goods,
The purchasing power of the gold is as great without the stamp of the
Government, without the legal tender quality, as with it. Silver coin
not redeemable in gold has a purchasing power only equal to its intrin-
sic worth.
“The merchants comprising the Chamber of Commerce have busi-
ness dealings directly or indirectly with every nation of the globe.
They are as generous, as charitable as any body of business men any-
where. But the Chamber of Commerce is not a charitable or eleemosy-
nary institution. It is not a missionary society. It is not a specula-
tive institution. It is not organized to try new experiments in finance
on a large scale for the benefit of this country or for the benefit of other
countries. It is a business association of merchants. Its object is to
encourage trade, to extend commerce, to make this city more and more
the financial and commercial center of North America.
“In order to do this the merchants of this city must continue to do
búsiness upon the basis of the best money. The records of this Cham-
ber show that from the beginning to the present time for a hundred and
twenty years it has pursued but one course, it has had but one opinion
upon the subject of the true standard for money. I feel certain that
now, when no legislation upon this subject is needed, the Chamber of
Commerce will again record its vote, as it has always been recorded, in
favor of a gold standard, and in favor of the report which has been
made by its Finance Committee.
“This Chamber has from the beginning shown itself to be a careful and
judicious body in the consideration of all questions of finance. I know
of no financial measure it has ever recommended to Congress of which
it should be ashamed.
“If the Congress of the United States shall insist upon legislation
Contrary to the experience of all other nations; if it shall insist upon
trying a great monetary experiment for the benefit of the human race,
without concurrence of even one other great nation—not even of
France—let Congress alone take the responsibility; let it do so without
the indorsement of this Chamber,”
From //e JOURNAL OF COMMERCF, Friday, /a/. 16, 1891.
THREE PECKS TO A BUSHEL,
It is a matter for congratulation that the free coinage proposition pure
and simple is in a bill by itself, and is not complicated with other ques-
tions. It is a plain, unvarnished attempt to give to the present holders
of silver bullion, here or abroad, and to all future producers in any part
of the world, the right to have the dollar stamp put on every 37 I }{
grains of the metal, without regard to its market value, and to offer it
as a legal tender for the sum expressed on its face. When this extraor-
dinary measure passed the United States Senate by a vote of 39 to 27,
On Wednesday, the 14th day of January, silver was selling in London at
48% pence, so that the 412% grains, nine-tenths fine, or 37 I }{ grains of
pure silver, which the dollar contains, was then worth $o,82.23, or say
eighty-two and one-quarter cents. This was an advance in price caused
by the consideration of the proposed law, for precisely a week before
the quotation was 47% pence, making the silver dollar worth to melt
only 8o34 cents. The price of silver in this country corresponded to
that figure, and had been even lower, so that this in round terms is a
proposal to allow every holder of 80 cents’ worth of silver the right
to have it stamped for him at the mint so that he can pass it for one
dollar.
It is true that no act of Congress can make three pecks equal to a
bushel of thirty-two quarts, but a law prescribing that three pecks shall
be the contents of a bushel, in the legal definition of that term, must
work much hardship to those who have committed themselves to a con-
tract when the word had a different meaning. Simply changing the
descriptive contents of the bushel measure would lead to much trouble
and confusion, but every man who thereafter contracted to buy or sell
a bushel of any article would understand that he was only buying twen-
ty-four quarts, and could govern himself accordingly. But when twen-
ty-four quarts are made a legal bushel for the settlement of all previous
engagements, the case is widely different. The embarrassment of busi-
ness increases, and not only that, but the grossest injustice is perpe-
trated. To say that three pecks shall be a bushel in the settlement of
all contracts where there is not an express stipulation for thirty-two
quarts, is virtually the same as saying that in all such cases a man who
has undertaken to deliver a certain quantity of any produce may Satisfy
his contract by tendering three-fourths of the amount. He nominally
delivers the full quantity, but they are all short bushels.
It is true that the 80 cents’ worth of silver when coined is now a legal
tender for one dollar, but the few that are issued are made of silver pur-
chased for the mint at its market value, so that the extra 20 cents is left
in the Treasury for the common benefit of all the people. But the new
plan proposes to give the 20 cents to the outside holder. Instead of the
Government buying the silver at $1.04 or $1.05 an ounce, and paying it
out at $1.29% an our ce, this bill offers the privilege to outside holders
THREE PECKS TO A B (JSHEL. 7
and producers. They may get their 80 cents’ worth of silver duly
stamped and pay it out for a dollar. If the people to whom it is offered
might take it or refuse it at their option the case would be bad enough,
but the law makes it a legal tender, so the Creditor must take it. By
this device the owner of the silver can pay off every dollar of his indebt-
edness with 80 cents’ worth of the metal. Q
It may be said that the creditor who receives this money can turn
around and pay it out again for the same amount, SO that he loses noth-
ing by the transaction. But here come the difference. He has loaned
a hundred bushels of corn when four pecks made a bushel. The law
makes three pecks a legal tender for a bushel, and he gets back from
the borrower, nominally, a hundred bushels, but really only 2,400
quarts for the 3,200 quarts he loaned to his neighbor. The law is imper-
ative, and that contract is thus settled. But he turns around now to
dispose of the grain thus returned to him. It is true he may call it a
hundred bushels and sell it for a hundred bushels, but unless he, too,
has a contract previously made, he cannot get for it the same price he
could realize for a hundred bushels holding 3,2OO quarts.
And this will be the difficulty with the dollar when any one having
80 cents' worth of silver can obtain it in an even exchange. If he owes
a hundred dollars for meat or groceries, he can make the butcher or the
grocer take the coin for settlement. But when he goes for more meat
and groceries he will find that the price (in exchange for silver dollars)
has gone up. The butcher and the grocer will tell him that if he brings
the gold he can buy at the old rates, but if he insists in paying in silver
he must pay the difference between the market price of the silver dol-
lars and that of a gold piece of similar face value. This may not be
20 per cent. at once, but the selling price for the two metals will grad-
ually widen until each will pass for the market value of its intrinsic
COInterltS.
The mistake is in supposing that natural laws can be set aside and
their operation absolutely prevented by an act of Congress. Even
those who see that the laws of One Country cannot produce this effect
in the face of the world, seem to have no doubt but what the combined
legislation of all nations would possess such a power, which might be
exercised if there was a common agreement on the subject. The man
who has a hundred dollars in gold sends it to London to settle an
account. It is not received as dollars, but as 2,580 grains of gold, nine-
tenths fine. It is melted and it turns out 2,322 grains of fine gold, so
that his remittance nets him a little over twenty pounds Sterling. If he
sends out a hundred dollars in silver that too is melted, making 37,125
grains of silver bullion, for which he would get at current rates less than
seventeen pounds sterling. All the acts of Parliament that could be
passed would not wholly change this result, Gold does not derive its
value solely by the fiat of the Governments that use it as currency. If
by common consent not another gold coin was struck at any mint, and
every piece was withdrawn from circulation, it would still be wanted,
and would have a high market value as a beautiful, malleable, incorrod-
able metal useful for a thousand purposes outside of the currency.
The country will survive the shock, whatever is done, but some peo-
ple will learn a very costly lesson from the experience if they go to
school to this expensive teacher.


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/~ 22 ſ. zºzz-
UNLIMITED SILVER COINAGE AN
UNLIMITED DISASTER.
REMARKs
MR. MORRILL OF VERMONT,
SENATE OF THE UNITED STATES,
January 6, 1892.
VVASH IN GTON.
1892.
*w-a-sa frtº
3&º-1's
*...*.*.**********
R. E M A. R. KS
OF
H () N. J U S T IN S. M. O. R. R. II, L.
The Senate as in committee of the whole having under consideration the
bill (S. 51) to provide for the free coinage of gold and silver bullion, and for
other purposes—
Mr. MORRILL Said:
Mr. PRESIDENT: Certainly I should not have attempted to
make a speech at a day So early, perhaps not any time, if a silver
debate had not been opened, as it has been, by the distinguished
junior Senator from Nevada [Mr. STEWART] in an elaborate
speech, and also by a bill for the free and unlimited coinage of sil-
ver. I fear my remarks may be as much of a drug to Senators
as silver itself, but the great question should have some atten-
tion; and what I esteem to be a duty, however onerous, I can not
afford to shirk.
The financial instrumentalities and monetary affairs of our
country are of such transcendent importance, touching not only
the pocket of every citizen, but the honor and general welfare of
the whole people, that it must be conceded they deserve to be
discussed as questions of national gravity, and not merely as par-
tisan or campaign topics of local or ephemeral interest. At my
time of life I can have no other impulse than a desire to be right
and to speak the truth as I have learned it, but this may compel
me, in plainest words, to criticise what seem to me erroneous and
mischievous theories, and to present such facts and arguments
as appear to be conclusive in support of the public credit and that
sound standard of money which will abide forever and in har-
mony with the money of the most enlightened Christian nations.
Permit me to say that I am now and ever have been in favor .
of maintaining both gold and Silver in circulation, and of silver
to the extremist boundary that can be maintained on a parity
with gold. It would be a real joy to me to have silver greatly
increase in actual value.
. I did not vote for the silver act of 1890 for the reason that sil-
ver bullion was neither to be paid for nor paid out in accordance
with the safer proposal of Secretary Windom, and that the silver
to be purchased was fixed, as it appeared to me, at a too mag-
nificent amount; and also that a full price would be paid for a
commodity which we could neither sell nor part from, to any
Considerable extent, without a financial revolution and serious
loss. I was not unwilling to strain a point in order to satisfy our
Silver friends, but they appeared to demand too much, and some
seemed unlikely to be long restrained from demanding more or
the whole earth. For the first time in my life Idodged the ques-
tion, and did not vote against the bill, not only because my vote
4
Ö.
would not have changed the result or Secured anything better,
but because my distinguished friend, the senior Senator from Ne-
vada [Mr. Jon ES], begged me not to, and all Senators know how
irresistible the Senator from Nevada can be when he chooses. I
hope now—and I much regret his absence to-day—he will be
ready to reciprocate, if the occasion arises, when I entreat him
not to vote for free coinage.
However ingenious the legal argument of the Senator from
Nevada [Mr. STEWART] may be on the silver statutes, I think he
will be apt to find very few able lawyers who will agree with him.
The Senator denies any authority of the Government to sell bonds
to obtain gold with which to redeem legal-tender United States
notes, unless they were issued prior to January 1, 1879. The
words of the law of 1875 are very general, directing what may be
done after January 1, 1879, and apply to the unlimited redemp-
tion of outstanding legal-tender notes at any future time; and
whether dated before or after, but still outstanding, would not
seem to be of the slightest importance. Such technical criticism
only touches the bark and does not reach the heart of the law.
The Senator surely wants to be understood as in favor of the law
for keeping silver on a parity with gold, but, like Ensign Steb-
bins, whose memory is perennial, on the liquor law, he is ever-
lastingly against its enforcement.
The Senator also declares that the Treasury Department dis-
criminates against silver in the payment of the public debt, but the
Senator surely has been misinformed. The usage of the Depart-
ment has ever been and is now to pay all creditors alike in checks,
and the holders get them cashed and receive whatever they de-
mand, whether it be paper, silver, or gold. Silver bullion, of
course, is paid for in the same manner. If there is any discrimi-
nation it is not by any Government Department, and gold is as
likely to be demanded and received by silver bullionists as by
any other parties.
I regret that I am unable to assent to the conclusions of the
leading silver Senator either on silver laws or silver policy. The
path he points out for the Secretary of the Treasury to pursue—
to force silver upon all Government creditors—would lead in a
single day to a silver standard, and practically accomplish about.
the same result as would unlimited silver coinage. Believing
that such a result would be an almost incurable calamity, as do
the people in the North, West, and East, Republican and Demo-
cratic alike, I shall offer Some reasons why the pending measure
should here find no favor.
Any reference which may be made by me to the silver act of
1890 will be made for the purpose of showing that Congress then
went to the ultima thule of silver legislation, and that silver
adventures in Seas beyond are extra hazardous. Even that leg-
islation, as it now stands, will require modification, and can not
be accepted as the settled policy of the country for coming gen-
erations. Time will show; but before going further the Amer-
can people will want a reckoning to find out just where they
stand, and whether silver is on top or the people. The policy of
an international compact relative to silver, as slender as the out-
look may appear to some of our friends, perhaps may be our safest
refuge, and I hope is not to be wholly abandoned, and I can not
believe it will be by the present administration.
National-bank notes are rapidly being made to step down and
MOR
5
out to give room to silver paper. Like Naboth, they had a vine-
yard which Ahab wanted, and therefore were stoned and killed.
The original United States notes, or greenbacks, are likely to be
the next sacrifice demanded and stoned, in order to give the whole
field to silver paper. -
For many years we have been industriously attempting to do
something to increase the market value of silver and to make it
more truly, at home and abroad, one of the precious metals. To
this end the force of statute laws and the coefficiency of inter-
national diplomacy resorted to again and again have thus far
all ended in significant failure, and the market price of silver
to-day stands at a lower figure instead of a higher than in 1878
or 1890; and as money in Europe its domain is diminishing and
nowhere commands aggressive and influential supporters. This,
it would seem, ought to beget Some distrust about the success
and omnipotence of Congress in attempting further silver ex-
periments and dull the edge of appetite for free coinage.
We have purchased since 1878 silver to the amount of $376,-
925,827, and have coined over 400,000,000 of silver dollars, but
the amount of silver purchased, at its present market value, shows
that we have been losing heavily in the silver business, and
have relieved the owners of silver bullion from a dead loss,
amounting to $36,063,648, by taking this bullion off their hands.
But free coinage would have involved a far greater loss, as silver
since 1878 has been purchased for $71,952,390 less than its coin-
ing value; otherwise with free coinage the total loss to the Gov-
ernment would have been $108,016,038, and this round sum might
have been added to the profits of the silver corporations.
No expedients have been untried, and no cost withheld, to push
or carry silver dollars into circulation; but it has been demon-
strated that no more than about sixty million dollars of over four
hundred million coined can be coaxed or kicked outside the
Treasury. Even had it been possible to apply hydrostatic pres-
sure, no greater sum could have been forced into the congested
channels of circulation or into the reluctant pockets of the peo-
ple. The weight is objected to as too heavy and the value too
light.
We hold in the Treasury to-day in silver dollars and silver
bullion over twelve thousand tons which even burglars have
almost ceased to covet, and only express companies appreciate
its value when they lug it across the continent, but which the
Government is required to hold and guard night and day, to-
gether with all forthcoming monthly additions. When and
where is this silver deluge to end? In ten years more, under
existing statutes, the Government may have locked up in its sub-
terranean vaults silver to the aggregate amount of, perhaps,
more than one thousand million dollars, for all of which its obli-
gations, payable in Coin, will be outstanding. Is this, like the
river of the poet, to run on forever? And shall this inunda-
tion be further aggravated by unlimited free coinage? -
No silver certificates, or Treasury notes issued for silver bul-
lion, have been presented for payment in silver, but they are
paid in gold when so demanded.
How long they can be thus kept on a parity with gold is al-
ready a matter of public and profound concern, and largely de-
pendent upon an honest and proper interpretation of the law and
the courage and skill of the Secretary of the Treasury. When-
MOR
6
ever the gold in the Treastury shall vanish, and it may vanish
under a cloud of silver as well as under a cloud of adverse ex-
changes, these certificates and notes can then be paid only in
standard silver dollars, and these, as money, are known to be not
worth their face value. As security for silver certificates or
Treasury notes, which are to circulate at par with gold, they are
motoriously inadequate, as 412; grains of silver, nine-tenths fine,
will fetch no more than 74 cents. It would be hardly less safe,
and certainly equally honest, to base such certificates and notes,
and circulate them as good money, upon, iron or copper, or upon
wheat or tobacco, purchased and accumulated in like manner, at
33% per cent above the market value, as to base such circulation
upon the so-called standard silver dollars under free coinage.
Whatever advantage from unlimited free coinage of silver may
accrue to corporate owners of silver mines, when gold advances
to a premium, will be brief and not permanent, as then no Seo-
retary of the Treasury would be willing to sell United States
bonds in order to obtain gold to keep any paper currency paid
out for silver on a parity with gold. These corporations, there-
fore, at no remote period would have their own drug return to
plague the inventors, and find silver certificates or Treasury
notes received for silver bullion, when unsupported by gold, of
no greater value than that of the silver contained in the free-
coined silver dollar. They will not be able then by any shift to
fare much better than other classes of our people. It will not
mitigate the sufferings of innocent people, however, that the
corporate owners of silver mines will Sooner have come to grief
from their own prescription than would have been possible from
any other source.
Of course some of our excellent argentiferous friends sincerely
imagine that they can secure forever by free coinage all the dif-
ference there may be between the real or commercial value of
3714 grains of pure silver and the legal-tender or par value of
the silver dollar, now amounting to 33% per cent, no matter how
wide that difference may be; but they would be more likely to
find their last days worse than the first, as silver dollars, when
no longer upheld and supported by gold, as they long have been,
could not fail to sink to about the level of their commercial
value as silver bullion. Real money must stand the test of the
world's melting pot. The Mexican dollar, with more of silver
than our own, is here worth only its weight as bullion. The
coining of silver will add nothing to its real value, and, like any
other commodity produced in excess of the demand, its value
must be largely regulated and determined by the average cost
of its production. The boundless profits of the corporate mine
owners might not then be so conspicuous, but even then fat divi-
dends would not become wholly extinct, as the rich mines, bear-
ing no brother near their throne, might kill off the lean, and
diminish competition.
The experiment which is now being made to have our Govern-
ment purchase, on compulsion, a fixed monthly amount of silver
has, I fear, complicated and more or less retarded any interna-
tional compact relative to silver, and perhaps contributed to the
degredation of its value by largely restricting the demand to one
country alone, and by the practical exclusion of any popular de-
mand from any other. The menace of unlimited coinage, with
the Swelling accumulations of coined and uncoined silver in the
MOR,
7
Treasury, which may, in some financial contingency, be thrust
upon any or all other markets, not only tends to perpetuate its
resent uncertainty of value, but may further tend to sink it to a
ower deep. Certainly unlimited coinage would indefinitely
postpone all hope of an international compact. . .
Some very able prosiiver men, most absurdly, as it appears
to me, claim that the late wider difference between the value of
gold and silver has arisen from an advance in the value of gold,
and not from the depreciation of Silver, but this pathetic fallacy
is at once and forever refuted by the infallible standard of labor
which offers its testimony over a large part of the whole world
that it now receives from 33% to 50 per cent higher wages in gold
or its equivalent than was received thirty years ago, though I
shall not deny that the wages of laboring men have not thus ad-
vanced in any country where silver is the standard currency.
The mint price of gold in London is now the same as it was in
1776, that is to say, £3 17s. 10%d. per ounce. Nowhere else is it
worth any more. This is Some proof of its permanent commer-
cial stability, and of its unchanging standard of value. English
statisticians assert that gold has depreciated, and that a gold
guinea will not now purchase so much of the necessaries of life
by 20 per cent as it would a few years ago.
It is true that prices of many commodities have fallen because
they are now produced with less labor by the more universal use
of improved machinery and of steam power. Silver, also, has
been made cheap, not only by the boundless productiveness of
new bonanza mines, but by wonderful American improvements
in Science and mechanic arts upon the rude and primitive min-
ing methods of Potosi, Peru, and Mexico. The cost of produc-
tion, like that of copper, nickel, and iron, as well as salt, and
sugar, has been very largely reduced. The total product of sil-
ver has, therefore, been vastly increased and its commercial value
correspondingly diminished.
In 1854, according to the Director of the Mint, the annual sil-
ver product of the world amounted to $40,000,000, but in 1890 it
had swollen to $166,667,000, or over four times the product of
1854. Will any learned Senator contend that this enormous and
unprecedented increase of silver has not had the usual and in-
exorable effect of diminishing its current value? John Locke in
1690 stated that silver had fallen seven-tenths since Henry VII,
in consequence of the amount poured in from America. When
the world’s stock of silver for twenty-five years had barely in-
creased annually $11,000,000, Adam Smith says, it fell to one-
third of its previous value. Neither Locke nor Smith were
unfriendly to silver. I leave the tyros of 1891 to adjust any dif-
ferences with the renowned authorities of 1690 and 1776 as to the
effect of a largely increased supply upon the value of silver. The
world in earlier times accepted the facts, and we can not escape
or dodge the insurmountable facts in the history of the present
silver era. -
The depreciation of silver has been accelerated not only by its
greatly increased abundance, but also by its diminished use as
money by leading commercial nations. On a gold standard
Great Britain is the center and mistress of the money exchanges
of all the world. Germany, changing from Silver to gold, has a
large unredeemed stock of antiquated coins yet to be disposed
of; and France is no longer a buyer of Silver, and has not been
MOR
8
since 1873. No European nation now opens its mints to the free
coinage of silver, but all are fighting shy of it, and only tolerate
it as subsidiary coinage. Even in Mexico it is subject to a heavy
tax of seigniorage of about 43 per cent. The drain of silver to
India, where formerly nearly one-third of the world’s total prod-
uct was annually absorbed, has not yet ceased, though apparently
this year diminishing, and will not wholly cease SO long as wheat,
cotton, and other products can there be bought with silver; but
India, like the United States, is beginning to learn that it is
buying an elephant.
The total output of silver, including the large increase in
Mexico and Bolivia, Australia and the United States, has more
than doubled, even since 1873, while the legitimate demand for
it, though intrepidly and Ostentatiously promoted by the United
States, appears to have fallen off elsewhere more than one-half.
The law of demand and supply is as autocratic as that of gravita-
tion, and silver is not exempt from its all-pervading power. •
Keeping in step with the great stride of our silver act of 1890,
the discoveries of new silver mines in 1891 are reported to be as
phenomenal in their extent and fertility as were the discoveries
of our gold mines in 1847, and some of the ledges are reported to
yield from one thousand to four thousand dollars per ton. A Cal-
ifornia magazine declares, “It would seem that the old expensive
silver mines will be closed up by these new, rich, and easily
worked mines.” The opening of the rich Lake Superior copper
mines, it will not have been forgotten, at once immensely reduced
the commercial value of copper. When there is a large over-
production of corn on the prairies the price goes down, and so
low that it is used even for fuel. The several million bales of
cotton we have raised this year probably will be sold for less
than would have been a crop of only five or six million of bales.
Ps it any wonder that the value of silver has depreciated? On
the contrary, the wonder will be if there should not be a further
depreciation. If by chance the output of silver should be dimin-
ished by one third, most likely the total value to the silver pro-
ducers would suffer no diminution.
Silver is a large product of our thrifty silver States, happily
not dominant in all, but is doubtless more remunerative, and likely
so to continue, than any other mining product, or any product
of agriculture or of manufactures. The Granite Mountain Com-
pany in Montana, one of the largest, obtains silver, as has been
authoritatively reported, at a cost of 14 cents per ounce. But the
same authority states the average mining cost of Silver from Amer-
ican mines at 51 cents per ounce, while it brings now, even in
the Season of its great depression, nearly one dollar, or 94 cents
per ounce. That is to say, it fetches in all markets almost dou-
ble the first cost. No other industry offers such dazzling money-
making attractions.
The great silver corporations, however, are eager for more.
By existing law the United States Government has been buying
and is bound to buy silver at its going market price to an amount
about equal to the total production of the American mines, leav-
ing consumption for the arts almost wholly dependent upon a
foreign Smpply. No other industry claims such rotund and gi-
gantic protection. Considered as an industrial American prod-
uct, I should not haggle about nor begrudge it full and ample pro-
tection to the capital and labor employed; but silver miners have
MOR,
*
9
no promise of an increase of wages in case of the free coinage of
silver, and silver as a standard of-money must, for all the world,
stand or fall upon its intrinsic merits, and not upon the merits of
the place whence it comes.
The silver propagandists, of whom the president of the Mon-
tana Granite Mountain Company, Mr. Rumsey, appears to be an
honored and distinguished member, from their abounding re-
sources, maintain here year after year an expensive literary and
oratorical bureau to propagate and disseminate their silver theo-
ries and financial dogmas.
They innocently declare, with one eyebrow drawn up and the
other drawn down, that they only seek to have silver placed on
an equality with gold, knowing, as they do, that their inequality
has been displayed from age to age, and is as wide as that be-
tween the Sun and moon, and that Silver for many years appears
to have been aping our unstable satellite by its restless monthly
changes. If they did not suppose that free coinage of silver
would give it supremacy and banish gold from circulation it
would be safe to believe their love for the silver dollar would
disappear as swiftly as the light from a falling star. No an-
archist has oftener denounced gold and gold bugs, or with a
deadlier hate, than the ultra partisans of silver. Their devo-
tion to silver is shown by swearing at gold. The transparent
design appears to be to bring silver in America to the front
as a lower and cheaper standard of money, with which to buy
and sell, as the Sole measure of debts, and as a more tempting
and sinister inducement to the debtor Glass to follow a treacher-
ous lead. - *
Whether or not the measure would be honest or honorable on
the part of the Government in relation to all existing contracts,
they do not care to discuss, nor even to consider who the debtors
really are. When they are found it would be discovered that
the great corporations are the largest debtors of the conntry.
The bonded and other indebtedness of our railroad corporations
is enormous, and amounts to $5,753,541,542, or about six times
that of our national debt. The indebtedness of our savings.
banks, loan and trust companies, and other banks, to a great
multitude of depositors, mainly for laboriously accumulated sav-
ings, in the aggregate amount to $2,539,256,699. These are the
parties to whom is to be offered the cheaper money with which
to discharge obligations incurred upon a gold standard, often to
those whose Sole surplus is the lone deposit in a savings bank. It
will be seen that it is very largely the great corporations which
would reap where they have not sown.
The fact that all laborers, whether working by the day, month,
or year, belong practically to the creditor class, is also stealthily
ignored; but American men and women are not easily hypno-
tized, and would soon learn the difference in the value of their
wages when received and expended under a silver standard.
The silver-tongued orators promise to give us silver as cheaper
money, and in the next breath promise to bring it up to the par
of gold. Somebody is to be cheated. Who is it? One promise
or the other must prove false.
The slanderous tales concerning the amount of mortgage in-
debtedness of farmers turns out to have been a wicked exagger-
ation or a big lie based on a little truth. The major part of such
mortgages has been made with the deliberate foresight of buy-
MOR
10 i
ing and holding land for its increment or for its future increase
of value; and the parties, for the most part, will not be disap-
pointed. The old custom of fifty years ago among farmers of
barter or of a running account with merchants, payable at the
close of the year in truck or by promissory note, is obsolete, and
for whatever farmers have to buy or sell payment is now nearly
always made with cash on the spot. A careful investigation
would show that there are in almost every State more farmers
having debts due to them than there are farms encumbered by
mortgages; and there is no class of our community more indus-
trious and economical or more obedient to the gospel of St. Paul,
“Owe no man anything,” than that of the farmer.
Finally, this silver bureau threatens the country desperately
as an extract from One of their circulars will show, as follows:
That if silver can not be remonetized, gold Will be demonetized and paper
substituted for both gold and silver. The people will not be destroyed for
want of money. The gold trust, by rejecting One of the precious metals, has
taught how both may be rejected. The radicalism for contraction is in dan-
ger of being met by a radicalism for inflation.
The impotence of this rather blustering threat will be apparent
when it is remembered that the fiat paper money party, which
proposed to pay the public debt in paper, left neither heirs nor
estate to perpetuate its brood or its lunatic memory. Its quack-
ery is also made conspicuous by the assumption of Supreme power
to do whatever of harm or mischief they choose, and by the de-
clared purpose, if they can not have silver they will not have gold,
but will jump to nonmetallic money aud inflate the country with
a flimsy flood of unredeemable fiat paper money. If the bad is not
to be had, then, copying from Milton's Satan, “Evil be thou my
good,” they propose to have the worst. If they can not have the
measles, then they will have the Smallpox; and if they can not go
to purgatory they will go to Hades. *
While the bold pretense is made that there is a lack of money
in circulation, unquestionably the foremost effect of unlimited
free coinage of silver would be a premium on gold which would
prompt its universal withdrawal from circulation, and thereby
produce a real and fundamental lack of money in all parts of our
Country; creating a stringency of greater Severity, perhaps, than
any hitherto known. The passage of such an act would be the
danger signal for everyone to “save himself who can” and thus
inoculate the malady it set out to cure. Gold-hoarding would
become a national epidemic. The payment of gold certificates
would be swiftly demanded at the Treasury by the holders.
United States notes would be sent there in flocks for redemption,
and the hundred million redemption fund might grow beautifully
less and be soon exhausted, leaving two hundred and forty-six
millions unredeemed, as well as the whole series of silver cer-
tificates and Treasury notes, with nothing in sight for their
redemption but the 74-cent silver dollar. Certainly our gold
eagles, Snubbed at home, would go abroad where more justly ap-
preciated. The withdrawal of our present national stock of
six hundred and Seventy millions of gold, being larger than our
present stock of silver, from the money in circulation, could not
fail to create such a stringency and financial distress as no lover
of his country would wish to behold. The superior value of gold
abroad, attracting a brisk exportation, would produce a large
contraction, not only of the money for ordinary home business
MOR
ll
but the demand for gold contracts could only be supplied by the
payment of extraordinary premiums.
With robust audacity and obstinate misinformation some of the
Silver organs still assume that there is a great want of money in
our country, when in truth morey here has never been more
abundant nor more in circulation per capita than at the present
time, and it is also increasing at the rate of sixty millions an-
nually, having increased since 1889 over $120,000,000. The in-
crease in the month of October last was over thirty millions.
There is in circulation as money more than twice as much as we
had in 1878. We then had $729,132,634, compared with July 1,
1891, when we had $1,500,067,555, not including any part of what
was held in the Treasury. The circulation per capita in 1878 was
$15.32 against $24.35 December 1, 1891, or greater than in the
most prosperous years of our history. Even with our extraordi-
mary crops of the present year of corn and wheat, of cotton and
tobacco, there is no visible lack of money in any quarter to move
these vast crops to market. These simple but indisputable facts
show how easily the hysterical tears for the want of money can
be made to dry up. *
From the universal American habit among all business men of
using their own checks, on banks where they have deposits, as
substitutes for money, there is less of legal-tender money used or
required per capita in the United States, in proportion to its im-
mense business, than in any other country of the world. Nearly
every Smart town in the country has its bank. The bank credits
subject to check April, 1891, were $2,604,000,000, and savings
banks deposits subject to check, with various conditions, were
$1,524,000,000. Together these institutfons furnish a basis for
checks in lieu of money of individuals and firms, greatly exceed-
ing all the coin and paper money in circulation. It has been re-
peatedly shown that the daily use of such checks actually covers
more than 90 per cent of all business transactions.
But with unlimited coinage of silver, who would get the first
grip of the increased amount of paper money issued to pay for it?
Not the merchant, not the blackSmith, and not the farmer, but
only those having silver to present to the mint and demand it.
There is now apparently no Scarcity of money among those who
have anything to sell or exchange for it, and borrowers are really
most troubled, I fear, by a scarcity of collateral. * 4.
No loud lamentations for more money were heard until the sil-
wer mines began to overstock all silver markets, and then the
silver bullionists, assuming the vicarious attitude of Sorrowful
debtors, began a doleful wailing about the great want of more
money, and especially the want of silver money. No other would
stop the raging hunger. The “no small stir" of Demetrius, the
silversmith, shouting, “Great is Diana of the Ephesians,” was
made not so much in reverence to the goddess as from fear that
the teaching of the Apostle Paul, adverse to gods made with hands,
would deprive the craftsmen of a market offering much wealth
in the making of silver images; but shouts of “Great is Diana.”
no longer anywhere create even a small stir. When the ass, ag-
cording to AESOp, put on the lion’s skin, the fox having heard his
voice, said, “Well, to be sure! and I should have been frightened
too, if I had not heard the bray.” The most vociferous shouts for
more money come forth from the mouth of silver mines, and with
a Sonorous rºletallic ring that frightens nobody.
MOR, -
12
No age of the world has been exempt from dreamers and dem-
agogues, and at the present time the United States, perhaps, has
no more than its legitimate proportion of such pests, which like
grasshoppers in the field, as has been said, make more noise there
than large oxen. Their highest political importance is gener-
ally achieved as a third party, or as a Swiss contingent, ready to
enlist as an ally with any existing party that will yield the most
to the upbuilding of air castles or to the pulling down of Solid
temples. The “third party’ is ever ambitious to be a make-
weight, and wherever it moves it expects the other side of the
world to tip up.
The impression prevails among sober-thinking men at home
and abroad that the sound financial system of the United States,
maintained in harmony with that of great commercial nations
through the first century of its existence, is in danger of being
Supplanted by Utopian schemes, either fraudulent or fantastic,
and wholly based on slippery foundations. - -
The two old political parties are more or less imperiled by
the unknown strength of new parties, which promise many votes
for a few platform promises. The organized agitation of the sub-
treasury loaning scheme of the Farmers’ Alliance on land and
staple crops, and of unlimited silver coinage of the silver bul-
lionists, creates the chief existing distrust concerning our future
political and industrial career. How these reckless schemes
may be finally determined by party exigencies and how they
will affect public and private credit are unsolved problems that
now rest as an oppressive incubus upon the mercantile and
industrial interests of the country. This should be our golden
age, and it will be unless we stumble and make it only a silver
age. Peace with all the world, with abundant crops and ample
prices, should have left no cloud over the American continent.
Dynamite may not bring rain from the clouds, but the schemes
of financial balloonists will not fail to bring portentous monetary
Storms upon our people. .#
The Farmers’ Alliance scheme for issuing legal-tender paper
and loaning it by the Government on land mortgages would be
only a stale repetition of the John Law experiment, anciently
most expensively tried, and whenever tried ending in ignomin-
ious failure and bringing overwhelming disaster upon the gov-
ernment as well as upon the borrowers of the cheap paper money.
It is a banking scheme without capital, with the government as
guarantor of all borrowers. This old and exploded scheme was
recently again conspicuously tried by the Argentine Republic,
perhaps the richest country in South America, and there it has-
bankrupted the Government and fixed an indelible stain upon
the good name of the people. Argentine credit is apparently
ruined, public and private, and the premium there on gold is 250
per cent, and daily expected to advance. The lesson of cheap
money by banking and bond repudiation of Mississippi also still
lingers in the public memory. Notwithstanding the high charac-
ter of Some worthy indorsers, any party or faction of a party which
proffers aid and hospitality to such wild schemes, at war with the
prosperity of our country, will be apt at an early day to disavow
and deny the connection, like Peter, with an oath.
Our geographical position, facilities of intercommunication
with all parts of the habitable world, and the superior magnitude
of our agricultural, mineral, and manufacturing industries have
MOR
13
often suggested New York as a more appropriate site for the cen-
ter and settlement of the exchanges of the world than London,
the capital of a country where two-thirds of the whole popula-
tion would starve but for the regular supply of foreign food. Pro-
ducing here, as we do, more coal, iron, Copper, cotton, wheat,
corn, silver, and gold than any other country, American ambi-
tion for prečminence also in national monetary affairs was natu-
ral, and its gratification has appeared unlikely to be long de-
ferred. The number of vessels already entering the port of New
York is hardly less than those at the port of London. Why
should the trade and commerce of the whole world be compelled
to send its bills of exchange for the final adjustment of all ac-
counts through the British Channel, Straits of Dover, and up the
North Sea to a port at the fifty-first degree of north latitude, when
there is the much finer port and harbor of New York on the
western breast of the Atlantic,119 further south? Laudable as may
have been the ambition, any possibility of its fruition will have
beenforever extinguished unless the American standard of money
can be kept not inferior to that of other great commercial na-
tions.
It has been suggested that the free coinage of silver might be
limited to the American production, as if that would be enough
to remove all objections, when obviously it is the excessive and
ever-increasing redundance of the American production which
chiefly creates the world's embarrassment, and now seriously con-
fronts and embarrasses the United States. Our home consump-
tion might give some relief to the dread of a silver overflow in
foreign nations, but the exclusion of foreign silver here would
be hardly a drop in the bucket, and give no relief to the fact that
we have a remarkably obtrusive overflow of our own. If 5 grains.
of opium would kill the victim, what would he care that the
dose could not be increased to 6 grains, nor be administered by
a foreigner? Practically, however, the limitation would not,
limit. Illicit silver would win its way “where seraphs might.
despair.” - -
The proposition in effect would ask Congress to renounce its
constitutional power to coin money and regulate its value, and
to confer these functions upon the silver mining corporations,
leaving them to run the mints at our expense, and compelling the
Government to coin and pay for the entire annual silver produc-
tion of these great corporations, however large the amount and
whatever its value, regardless of the wants of commerce or of
the people. As our late honored associate, Judge Thurman,
would say, “It won’t do.”
For the monthly purchase of 4,500,000, ounces of silver, or
54,000,000 ounces yearly, the Treasury Department issues legal-
tender Treasury notes, inflating the currency in circulation at
the high pressure of fifty or sixty million dollars per annum,
greatly in excess of the annual increase of population; and this
Fº dollar has, in fact, less than three-fourths of the silver bul-
ion purchased behind it as security for its redemption, although
the Government is pledged to redeemit in coin, either gold or sil-
ver, but entirely at the discretion of the Secretary of the Treas-
ury. It is, of course, receivable at par for public lands, internal
revenue, and for all duties on imports. We have hitherto been
able to float all of the diverse and multitudinous varieties of our
legal-tender paper now in circulation at par with gold because
MOR
14
our stock of gold has been large, and also because exchanges
arising from foreign trade have generally been in our favor.
We have, therefore, kept at home not merely the American prod-
uct of gold, but have made the gold of other nations tributary to
our resources. Unlimited coinage of silver would give us only
371+ grains of pure silver in the dollar, while at its present price
of 94 cents per ounce we buy 510 grains for, a dollar, and yet the
redemption of all legal-tender paper, when paid in silver, will be
paid, as it can be now, with a dollar containing only 371+ grains
of pure silver, equal to 412; grains of silver nine-tenths fine, at
present valued at 74 cents.
Free coinage is a naked proposition by which to throw the
loss by the existing and palpable depreciation of silver from the
silver corporations, first upon the Government and then upon the
whole public. The Government is to issue its promissory notes
of a dollar for every 371+ grains of pure silver brought to its
mints. Ultimately these notes, being legal tender, will circu-
late and get into the hands of the people, whom the Government
will be powerless to shield from bearing the final and main brunt
of silver depreciation.
The United States product of silver in 1890 was 54,500,000
ounces, and its coinage value was $70,464,645. The deposits and
purchases of silver last year aggregated 71,840,663 standard
ounces, of the coinage value of $83,630,154. Beyond the Ameri-
can product therefore, it will be seen that there has been and will
be a serious influx of foreign silver to be reckoned in any unlim-
ited free coinage account. The idea that we could maintain such
an annual increase of silver dollars on a parity with gold would
seem to be only worthy of those who have faith in looking for a
silver spoon at the end of every rainbow.
No advocate of unlimited coinage of silver will be likely to
claim that our standard Silver dollar would have in any other
country a value exceeding that of its weight as silver bullion,
and America would thus have opened her mints, as the greatest
goose of the age, to be plucked at will. Our action on silver
would have equal potency in India to that of the Pope's bull on
the comet, and no more. The idea that the United States alone
can by any legislative necromancy lift the value of $3,810,000,000
of silver throughout the world to a parity with gold would be a
miracle too great to find acceptance until after the exit of the
nineteenth century. While nearly all business men to be met
with, having a real daily use for money, and no matter to what
political party attached, undérstand and protest against unlimited
silver coinage, how long would the great mass of our people, with
whom business men are in constant touch, be likely to be con-
tented with or humbugged by it? With free and unlimited
coinage of both gold and Silver, what owner of gold bullion
would take it to a mint of the United States, when gold coin is
worth no more than gold bullion, and receive back coins for cir-
Qulation in the same truckle-bed with silver of 25 to 30 per cent
less value? If any one went, he would go like the schoolboy,
“whistlifig aloud to keep his courage up,” and such visits would
be few and far between. -
Our European rivals in wealth and power are eager to clutch
the large possessions of gold we have so long firmly held, and
which they fondly hope we are by some queer suicidal blunder
about to part from forever. The astute governments of Europe,
MOR -
15
with sound financial discretion, tolerate silver, and a good deal
of silver, but only as subsidiary coinage; and while they may ad-
mit that American enterprise has accomplished many Herculean
tasks they have no faith in our annual output of sixty or eighty
millions of paper money on a basis of silver, and still less faith
that America alone can by unlimited free coinage increase either
the value or the stability of silver, but, if attempted, they are
persuaded that Brother Jonathan will have put on the poisoned
shirt of Nessus, and they look upon the impending closure of our
career in Herculean enterprises with sublime complacency.
It appears to me that unlimited coinage of silver by the United
States, alone is pregnant with the exile of gold and dire financial
calamities. As the experience of all the leading nations has
demonstrated, gold is the most potential monetary instrumen-
tality yet discovered by man. In a memorable speech of the
senior Senator from Nevada [Mr. JONES] in 1874, its merits were
eloquently set forth as follows: .
So exact a measure is it of human effort that when it is exclusively used.
aS money it teaches the very habit of honesty. It neither deals in nor toler-
*i;false pretenses. It can not lie. It lzeeps its promises to rich and poor
Let me add that without gold to uphold such money as we now
have in circulation, American industries, commerce, and char-
acter would all be sure to suffer a sad decadence, and the Repub-
lic itself would drop from the elevated rank it now holds among
nations. * *.
The silver measure of the last Congress, as it appears to me,
was a very broad and possibly a very extravagant concession to
the great corporations owning American silver mines, and too
nearly approaching the dangerous line of doing too much. Ex-
perience may show Some conservative modifications to be imper-
ative. And yet some of the silver advocates are not satisfied,
and insist upon something even more extravagant than the orig-
inal act. The silver corporations, decorated and to be decorated
with numerous foreign stockholders, hunger for still larger gains.
One-half sheer profit in the production of silver only whets the
appetite for more. They want the Government to give them
free coinage, which will be about 33% per cent above the market
value of silver bullion, and also to bear the cost of coinage and
the responsibility of all further depreciation of silver, by hoard-
ing it until at the last syllable of recorded time it shall “melt
with fervent heat.”
But if their supreme demand of free and unlimited coinage
were to be granted, they would not be persuaded to accept silver
Certificates or silver dollars in payment for silver, even after the
Government shall have been subjected to the expense of its coin-
age. The dollar, as they think, will be good enough for other
people but not good enough to pay for silver bullion. They, like
Some doctors who have a panacea for all the ills of humanity,
will not take their own medicine, but will refuse the dollar with
which they urge the Government to flood the country. They in-
sist upon having something better. The Government will be re-
quired to hold forever not only the dead weight now stored in the
overladen vaults of the Treasury, but also the future daily addi-
tions thereto from all sources, foreign and domestic. We are to
take it not because the Government wants it, but because nobody
wants it. .
MOR
16
The Gresham law that the cheaper will drive out the dearer
wherever there is any attempt to make one standard out of two
metals is one the “etermal verities,” and illustrates the homely
truth of the old adage that “if two ride a horse one must ride
behind.” This has been often illustrated in our own history of
gold and silver.
Not one of the mints of Europe is now open to the free coinage
of silver, but silver is kept as subsidiary circulation in large
amounts, as we have kept it, at par with gold, although the ratio
of value has fallen from 15% to 22 of silver to 1 of gold.
India. with its 250,000,000 of population, so woefully imposed
upon and bled by the depreciation and instability of silver, has
begun already to threaten through its learned Hindoo newspapers
to wholly demonetize it. Some of these British subjects do not
feel happy in being indirectly plundered by the silver standard,
even by their imperial mother-in-law. India is more likely in
the coming century to seek for more gold than is Great Britain
to seek for much more silver. The continuance of a measureless
demand for silver in India can no longer be confidently relied
upon.
The fluctuations of the value of silver, inherent and charac-
teristic, come down to us by continuous report from ancient ages.
It has always been unstable. By the law of Menes, king of Egypt,
the value of gold was fixed at 23 times that of silver. In the
time of Solomon silver was so abundant as to be accounted as
nothing, and in Ecbatana the tiles on the roofs of temples were
said to be of solid silver. In the fifth century the ratio of gold
was 6 to 8 times that of silver. In Greece it was, according to
Plato, 10 to 1. During the middle ages and down to the sixteenth
century the ratio was from 10 to 13 to 1, but was most often 10
to 1. The discovery of the silver mines in the new world brought
down silver to the ratio of 16 to 1. Since 1873 the product of
silver has doubled, and the actual ratio of Silver is now only 22
to 1 of gold.
During and after our silver legislation of 1890 the price of sil-
vºr went up from 43%d. per ounce in March to 54; d. per ounce
in August. On a silver standard it would have cost 23 per cent
more to have paid a debt in August than in March. A few alert
speculators who purchased silver bullion prior to this legisla-
tion and sold early thereafter may have made it a paying busi-
ness. The price is now down again to 43; d. per ounce. For the
immense increase of the product the world finds little use at the
former valuation. Only at a lower rate can it be utilized.
While all of its revenues are raised in silver, India is annually
required to pay or spend in England $75,000,000 in gold, a sum
which costs India, in its silver revenue, $112,500,000.
We are often told how England buys wheat and cotton in India
and pays for it with silver rupees at 48 cents which cost in Eng-
land only 33 cents, being an advantage of 15 cents on each rupee
over the wheat and cotton growers of India, resulting from their
standard of silver. Is it not clear that with the primacy of a
silver currency America would be as much handicapped as India,
and that American wheat, tobacco, cotton, or anything else here
might then be bought with the same advantage of cheap silver
that Great Britain now finds so prosperous in India? No farmers
will want to receive for their cotton or tobacco, wheat or corn,
cattle or horses, payment in dollars not as good as any other dol-
MOR
17
lar. If there is one class more interested in a sound currency
than any other it is that of the farmer, whose prosperity de-
pends upon what he gets for his annual crops; and good farmers
always have more to sell than to buy. ... Even the class that works
the shortest hours for a day’s work will not want to be paid in a
short dollar.
The brazen-faced political untruth, limping with decrepitude,
is still put forth, though refuted for the hundredth time, that
somebody was grievously wronged in 1873, when the silver dollar
was discontinued from our coinage, but it will not be forgotten
that no debt-payer could then have been Wronged, as all debts
might then have been paid in gold at 3 per cent less than in sil-
ver, and for six years after 1873 all debts were payable in legal-
tender United States notes, though at a large discount below the
standard of gold, and after resumption in 1879 they might have
been paid in silver, paper, or gold; the latter only being required
by law until 1878 for customs. It is true that no one, even among
silver producers, anticipated in 1873 that within ten years silver
would become so abundant as to radically change its relative
value. Since that date we have often coined more silver dollars
in six months than were coined in the whole previous existence of
the Government mints, and they are a legal tender, but nobody
seems willing to take them unless the Government stands ready to
gloss or exchange them for Something more desirable. They are
flatly uncurrent on the Rialto.
When silver separates from and ceases to be supported by gold,
as it long has been supported, and drops to its intrinsic value
only, all of our American productions which need protection will
suddenly find the tariff out of joint and its efficiency undermined
by the privilege offered to importers of foreign merchandise to
pay duties in cheap silver. They could buy bullion, have it
coined free, and tender it for all customs dues. This would be
tantamount to a horizontal reduction of all rates of duty, and
whatever the difference may be between the standards of gold
and silver, to the extent of that difference, whether 25 or 50 per
cent, there will arise an absolute and wholly illegitimate reduc-
tion of the tariff on foreign imports. With the present wages of
labor it would close up every mine (silver excepted) and factory
in our country.
The condition of the United States Government, however,
would be the reverse of that of the importers, and call for more
money instead of less in nearly every branch of its expenditures.
New resources of revenue would have to be exploited, and, if cheap
money should be found to annually expand Government expendi-
tures to the extent of one hundred millions, Poor Richard might
say we had paid too dear for the silver whistle.
Inflation with a depreciating currency is no remedy for any
lack of money, as it requires a progressive increase for a like
amount of business, or a new perpetual inflation to cure the old
Our whole superstructure of credits would be dislocated. No
parties would loan money at lawful rates of interest if threatened
with a large loss in the principal by an ultimate payment in a
lower standard of money. Special conditions would be required
in all loans, as well as in all sales of real estate or of merchan
dise, specifying whether payments were to be made in the stand-
ard of gold or of silver. Foreign trade would buy with gold and
sell for silver, and be subject to the charge and unceasing vacil-
MOR-2
18
lation of exchange, and all exchange would be tributary to Lon-
don. Home enterprises, especially of our new States, yet only in
the gristlé, would be stricken with paralysis. There would be
an era of suspended animation in all business before the new
régime of silver would be understood, computed, and adjusted.
Railroads, to cover running expenses, would be compelled to in-
crease freight and passenger rates. Rentals would be promptly
advanced. Salaries of judges, civil officers, and legislators, State
and national, would often be found inadequate and demand im-
mediate relief: Working men could not fail to discover the
cheapness of the silver dollar, and strikes for better wages or
better pay would become contagious. Farmers would calculate
not only the value of wheat, but also the value of the money of—
fered for it. *
The exportation of over Seventy millions of gold in the six
months ending with July last is admonitory of what may happen
in larger measure whenever the conviction becomes rooted that
gold is to be superseded and that Silver is to have the primacy
in the money standard of the United States.
Formerly a considerable amount of silver was annually ex-
ported, the excess of exports over imports being for the last fif-
teen years over $144,000,000, but now, with a largely increased
product, exports have greatly diminished, and the Government
under free coinage would be in a worse plight than it is in now
when only bound to run in debt annually for, and to hoard and
keep out of all markets, 54,000,000 ounces of silver. The result
of free coinage must be an annual decrease of the aggregate
amount of our exports, and any deficiency of exports must be sup-
plied by gold. . .
There are also more or less millions of American stocks and
Securities generally held abroad, thoughfar less at this time than
formerly, and any war panic or monetary pressure abroad or any
distrust of the American standard of money and credit can not
fail to send such stocks and securities home to our markets by
the swiftest “greyhounds of the ocean " to be sold for whatever
they may fetch. -
The sixty to seventy-five thousand of our American travelers
abroad probably require annually about seventy-five millions of
gold for traveling expenses, and other disbursements, especially
those for the usual bric-a-brac to be brought home. This is a
large and sorry drain which finds some, but rather diluted, com-
pensation in the reciprocity of foreign travelers in the United
States, and it may be added that of the half million immigrants
annually arriving not all are paupers, lepers, or anarchists, but
Some portion of them doubtless bring with them funds amount-
ing in the aggregate to Several millions of gold. The balance
against our country may be moderately estimated, however, at
not less than fifty millions. -
About two-thirds of our foreign carrying trade is done under
foreign flags, and the cost of the freight to be paid out of Amer-
ican funds is supposed to exceed $100,000,000. This, too, is a
Serious drain upon our resources, but it may not cease until some
other industries on land shall be comparatively less remunera-
tive, and certainly not until Ocean mail service shall be treated
with equal favor to that on land.
The nations formerly belonging to the Latin Union, together
with Germany and Great Britain, after the advent of free coin-
MOR
f
19
age, could no longer be asked by us to unite in an international
compact to resist the further decline in the value of silver, but
would find their interests perhaps better subserved by the gold
standard. Free silver coinage by the United States means not
only the absorption of the world’s surplus of silver, but the re-
linquishment of our stock of six hundred and seventy millions of
gold, as well as our annual product, which would at once find a
European welcome and relieve Several nations there of a financial
dilemma. •
With free coinage of silver once established there can be no
hope of future escape from it. There will be no road left open
for retreat. Whatever the degradation of our condition may be
we shall have no allies volunteering to lift us out of the Serbonian
bog. The Government could not afford to reform its millions of
silver currency by redemption or by its replacement with any-
thing better. Nor would it be just to our people, after all debts
were based upon a depreciated Standard, to compel payment in a
higher standard. The descent is easy, but to return, that is work.
Should we at any time find the silver standard disastrous, and
an insupportable impediment to the prosperity of the great Ameri-
can Republic, what could be done with our vast stock on hand of
silver? If we did not want it, who would take it? Not having
been able to bull the market, we might doubtless succeed better
as the great bear in the market, and by unloading, even some
modest part of our ponderous burden, make a big break in all
silver markets. Were any great exigency to arise in our national
affairs that should compel us to throw even a tenth part of our
millions of dollars of silver upon the cloyed markets of the world
the price would go down “from morn till noon and from noon til
dewy eve,” when, instead of the ratio of 16 to 1 of gold, it might
drop to no more than its mining cost, or show a relative value of
only 35 to 1 of gold.
Legislators may draw wisdom from the past and show some
prescience of the future, but must not be unmindful of the ex-
isting condition of affairs. Measures that once might have been
helpful, by changed conditions may now be very harmful. Years
ago we had a large preponderance in the product of gold and
little or no silver. To-day there is a large preponderance of
silver, and beyond our annual product of about thirty-three mil-
lions of gold we have no available resources to compete with our
unlimited production of silver. Until 1878 our law provided that
all duties on foreign imports must be paid in gold, and that
Source annually yielded a most useful and important supply; but
all that ceased as a legal requirement with the legislation of 1878,
and silver became as much a legal tender as gold. Whenever sil-
ver obtains the Supremacy any balance of foreign trade against
us would go out in gold; but when in our favor it would come in
silver. No one but a chronic dreamer can believe that it would
be possible, with resources so slender and crippled, to maintain
our silver coinage on a parity with gold. On the lowerstandard
of silver all the exportable surplus of our staple crops would
of course be paid for in silver, and therefore the balance of foreign
trade would not often be in Our favor. -
I have attempted to demonstrate, first: That the depreciation
of silver is both so great and universal that unlimited coinage
could not be maintained on the present standard with gold, but
would suddenly wreck the country by a silver revolution.
IMOR
20
Second. That unlimited coinage would interdict all interna-
tional silver compacts.
Third. That there is no scarcity of money in circulation, but
instead the amount is twice as great as it was in 1878, and is in-
creasing On a Canter.
Fourth. That a silver standard would be equivalent to a hori-
zontal reduction of the tariff of 25 per cent, if not more, and an
equal reduction of all pensions.
Fifth. That the enormous increase Of silver to the extent of
four times the product of 1854, coincident with a greatly lessened
demand for it, has so depreciated its value that unlimited coin-
age by the United States must prove a disastrous national blun-
der.
Sixth. That there is no magic in any law of Congress which
can make the world accept an ounce of silver as worth any more
in coin than in bullion.
Seventh. That the parties to first profit by free coinage would
be the corporate owners of silver mines only, and the parties to
finally suffer the largest losses by it would be the great mass of
our people, into whose hands the depreciated coin and Treasury
notes would finally pass.
The public credit of our great Republic is at stake. Shall we
have the best money standard of the foremost nations of mankind,
or shall we descend to the flickering and narrow gauge of silver
only for the conduct of a greater home and foreign trade than
that of any other people, ancient or modern? We have paid off
more than three-fourths of our great war debt in gold when our
resources were far less than now, and I am unwilling to forfeit
our well-earned reputation and lose public confidence and all the
ancestral prestige of our history by paying the Sorry remnant of
this debt in a legal tender of much less value. t
MOR.
O
(J
SILVER NOT A LOCAL ISSUE.
sIFEECH
OF
HON DARWIN R. JAMES | .
of ISTEvºz ºrcrºrz.
In the House of Representatives,
March 20, 1886.
WASBINGTON, D. C.
R. O. POLKINEIORN, PRINTER.
1886.
SILVER NOT A LOCAL ISSUE.
SES E2 E IFE C IEEE
OF
Hon. Darwin R. James,
CIF TST-ENZR7 Tsz-C-ER-E--
Eºſ, AUN WORDS FROM A PLAIN MAN FOR PLAIN PEOPLE.
The House having under consideration H. R. 5690, for the Free Coimage of
Silver, &c., upon the adverse report of the maiority of the Colmmittee on Coin-
ago, Weights and Measures, (presented by Mr. James for the Committee on
Foloruary 16, 1886.)—
Mr. JAMES said: Mr. Speaker, before I enter upon the subject of
debate I desire to say a few words in way of personal explanation.
I am a business man. I am not a lawyer nor a professor, neither
has my life been closely interwoven with the interests of practical poli-
tics, but I have attended to the business of a merchant. But I do not
deem it presumptuous that I regard my mandate from my constit-
uents in Brooklyn to be a member of this body, and my mandate from
the Speaker of this House to serve on the Committee on Coinage,
Weights, and Measures as a warrant for taking the time of the House
in setting forth my views on the subject now under consideration.
People are more wont to look to the lawyer, to the professor, and to
the political leader for light on these questions than to plain business
men. But unfortunately, Mr. Speaker, this habit of looking to the
lawyers, the professors, and the recognized political leaders does not
seem to have produced good results in this matter of the coinage of
the silver dollar. We have tried it for eight years, and here we are ,
now in a slough. How are we to get out of it? This is the ques-
tion. The car of state is very nearly being ditched. It is not a ques-
tion of making good time on the road, it is a question of getting the
wheels out of the slough. It is a question of making salvage that is
before the Committee on Coinage, Weights, and Measures and this
House. What are we to do about it? This is as far as the country
has advanced on the silver question. Things have gone on from
bad to , rse, and this is the outcome of the leadership of the lawyers,
the proféssors, and the authorized leaders of politics.".
These circumstances, Mr. Speaker, have convinced me that I ought
to take a hand in the debate. Without laying claim to anything par-
ticularly meritorious I may at least claim to be heard. I have all the
<)
*
more reason for this from the fact that the monetary question is pecu-
liarly a business question. On final analysis, the monetary question
is a question of prices, a matter of buying and selling ; and so it is, as
I have said, peculiarly a business question.
Then, again, Mr. Speaker, I ask the attention of this House to what
I have to say because the business men of the country are, after all,
a very numerous and influential class. They need awakening; they
need it in my district, they need it in your district. Gentlemen, I am
afraid we shall find that they need it in all of our districts.
I wish to be entirely frank about this matter. I am afraid that the
business men of the country have not been doing their duty to the
country. They have been buying and selling and have let high poli-
tics alone, even when high politics affected them most seriously. In
this they have failed in their duty to themselves as well as to the country.
I have no doubt that if the business men had had the power to deal
with the silver question the team of State would not have been stalled in
the mire as it is now, and it is largely their fault that it is so, for they
knew what the end would be. They should have spoken out from one
end of the country to the other ; they should have insisted that their
advice be followed. If I speak, therefore, of business men in my dis-
trict, of business men in your district, business men in all of our dis-
tricts needing to be awakened, I do it for the purpose of urging you,
gentlemen of the House, to talk this matter over with them as you see
them, and to elicit expressions of opinion from them upon this great
and far-reaching subject. I think this comparison of views will do
ood.
§ I want to hear from the sovereign people on this questtion of money
legislation. To handle this question wisely and to the best interests
of all, we need the advice of the men of business in our constituencies.
If my own voice could reach beyond this floor I would gladly see to
it that the business men throughout the country should at least hear
one loud call to join their forces for a righteous handling of this great
question. If we could accomplish this, enlightenment and instruction
would follow a discussion so general amid a people so sensible and
so practical as ours. I believe we should be practically unanimous
after hearing from them in voting a measure which would close the
current chapters of the history of compulsory coinage. What that
measure should be I am here to suggest.
I have given study to the facts which make the theories upon this
issue, and have measured the measures proposed with the same spirit
of determination to be right which applied to my own business while
in India, where I handled the rupee, or in New York, where I sold
the products of the East. The result may be summed up in these
words : the so-called demonetization of Silver has been from the start
a great business blunder.
I do not wish to be misunderstood by either the extreme gold men
on one side or the extreme silver men on the other, in my use of this
term. I speak of the demonetization of silver. They may presumably
think I mean the anti-silver law passed by Congress in 1873, and the
revision of the statutes in which the silver dollar was spirited away.
I do not. Perhaps they think I ought to mean it if I speak of de-
monetization. I do not think so. I say that I am right and that
they are wrong, for it is more than a question of words, Mr. Speaker ;
it is a question of ideas. à
In the first place, who demonetized silver ? My friends here talk
as if the United States had done it.
The so-called demonetization, which is in fact only an effort at de-
UIonetization (a partial outlawry of silver) is the culmination of a joint
*
3
undertaking. The chief quota of outlawry belongs to the nations that
controlled most silver and gold. France and her allies of the bimetal-
lic, free-coinage union, controlled nearly two-thirds of the metallic
money of Europe.
With their alternative free coinage, coining all that came, whether
gold or silver, at an express valuation by weight, they held the par
steady for generations. England’s anti-silver quota had been sub-
scribed and paid so long that it had all been spent. Germany's quota
to the fund was very large ; in fact, the responsibility for the evil re-
sults which followed demonetization in Europe is chargeable to the
action of Germany.
After the capture of Paris, in 1871, a series of anti-silver and pro-
gold laws were enacted, followed in 1873 by direct acts of calling in
silver coin to be sent to the melting pot, and thence to the bullion mar-
ket. France saw that if she continued the coinage of silver she was
simply “bulling ” the market for German silver, and was paying out
gold for a metal that would become a burden to her if Germany's ac-
tion should be followed by other nations. She therefore stopped its
coinage. The action of France was thought to be necessary, but it
was very unfortunate. She felt that she could not afford (by keeping
her mints open to silver) to enable Germany to transmute her stock of
silver into gold, taking French gold for demonetized German silver.
It was not agreeable to France to “bull” silver for Germany’s benefit,
and face the uncertainties of the monetary future with the added bur-
den to carry off the rejected silver of Germany.
It was said in 1870 by a leading statesman in Europe, Feer-Herzog,
that the anti-silver campaign is like a steeple-chase—those that demon-
etize first will win the prize, and those that come later will pay for all
the demonetization that has preceded theirs. Each was, therefore, in
a hurry to demonetize for fear the other would demonetize first; each
afraid to keep up silver coinage because the other rejected it. The
impetus giyen by Germany’s attack was passed along the line, and one
after the other of the mints of Europe was closed to silver. Now,
when I say this was a business blunder I do not say that it was a blun-
der of each nation acting by itself and with the sole alternative of
keeping up free coinage within its own borders for all the silver that
might come, or, on the other, of closing its mints. If it had been a
simple choice, between these two courses there would seem to have
been no way other than to stop. *
As the case was presented to France in 1874 and to Holland in 1875
it was the only safe alternative to be pursued. There are occasions in
one’s business experience when the question arises, “Shall we sell or
hold?” Our neighbors, like ourselves, are loaded with the same ar-
ticle; if we sell it is at a sacrifice; if we hold there is a loss; but if we
combine and arrange we can all sell at a profit.
But suppose you can not arrange, or think you can not, and there-
fore do not try, what is the result? You force sales; the bottom is
knocked out of the market, and down goes the price. It was a great
blunder of the nations as a whole, and it was a blunder of each single
nation in So far as that single nation could have stopped the ruinous
course of all. No one nation could afford to have the others unload
upon it. In point of fact there was neither sense or reason in any na-
tion trying to unload. It was a blunder to try; each nation as it closed
its mints to silver helped to depreciate the stock of silver coin it had
on hand, helped to render the money-basis of its valuations insecure,
and helped to re-enforce the momentum of Germany’s attack on the
stability of the existing valuations of property throughout the world.
4
The result was insecurity, uneasiness in the money markets, and a
great check to business activity. -
I am aware that there has been a widespread habit of ignoring these
facts. It was fashionable, so to speak, at one time to shout for the
single gold standard and for the demonetization of silver. Those who
did the shouting do not much care at this time to be known. For
several years they tried to conceal the harm they produced but they
could not. The facts are against them. The business of Europe was
done with both metals; by legislative enactment one is stricken down
and becomes non-exportable except as bullion. Now, who will pre-
sume to maintain that a country like Holland can do business as easily
and successfully with its twenty millions of gold, full weight and ex-
portable, and eighty millions of non-exportable, because depreciated,
token money, as with one hundred millions of full-weight exportable
money? To depreciate the scope of that eighty millions or, in other
words, to strike it with lameness, was bad business. Yet Germany
and France had forced Holland into this position, and so she stopped
coining silver and took to coining gold, doing what she could to in-
crease her stock of this metal. *
The outlawry of silver in Europe reduced a thousand millions of sil-
ver to the condition of inexportable, non-international, depreciated
money, in other words, to the condition of tokens which are a burden
to the state and to the business community. Now, all this never
would have occurred if there had not been anti-silver laws. Had it
not been for these there would have been no depreciation of silver.
Hence it is I say that the outlawry of silver was an immense business
blunder and a great business loss for each nation affected by it. The
story of the last ten years in Europe is a story of business depression
unexampled in history, and the main cause of the depression lies where
any business man can see it if he takes the trouble to look, namely, in
the series of laws in the different states of Europe artificially contract-
ing the metallic basis of valuations and making insecure a foundation
which should have been solid.
Gentlemen, do you want evidence of these facts? I doubt if you do.
The bistory of these ten years in each country is one of business crip-
pled, of marking down of prices, and suffering in every direction.
You know how it has been in our own country and can imagine how
it has been in other countries. Take England as a sample for Europe
and read Thorold Rogers and Robert Giften in 1879 (Document of Con-
ference of 1878). Read Mr. Goschen’s address in Manchester in July,
1885, and Robert Giffen in Contemporary Review for June, 1885; also,
recall the fact that a royal commission is to-day investigating the cause
of the depression of trade. What it all means for Germany is plainly
ſº by Baron von Mi”)ach in an address from which I shall quote
alter. -
But permit me, Mr. Speaker, to bore a little deeper into the facts.
Let us look at the state of affairs in Europe as a whole. We see the
nations of Europe engaged in a sort of monetary war, each nation hy-
ing an embargo upon the silver coin of other nations and upon new
silver from the mines. A state of affairs is thus produced which is
expensive to their treasuries and injurious to the industries and the
trade of each What is the cause ? Practically the start was made by
Germany, and it was a monetary continuance of the invasion of France.
The action of Germany forced the Latin Union to adopt the German
embargo on silver; it forced Holland to do the same thing, and France’s
embargo forced Germany to give up her sales of silver in 1879. I desire
to make this thought clear. This anti-silver movement practically in-
volves national hostilities, national pride.
5
But let us go one step further and ask how it came about that Ger-
many forced Europe into this embargo. -
Here we touch upon a vast question. Who can measure all the in-
formation and prejudice of the Savants who sought to control mational
action ? About the time of our war a “craze '’ seemed to take hold of
the economists, and it became fashionable to be an anti-silver man, an
anti-bimetallist, a gold single-standard man.
This is the gist of the facts. You can read the story in the books of
the conferences from 1867 to 1881. Now, we have heard repeatedly
from the extreme silver men that this anti-silver movement has been
and is a great conspiracy of the creditor class, of the bondholders of the
civilized nations, and that they worked up this sentiment for selfish
ends. Such is not the truth. The professors of political economy who
directed the thought of a generation, were not what is called “the
servile hirelings of bloated bondholders.” These men thought they
were reformers, and they meant well: but their foresight was incorrect
They made a mistake. The outcome of their work was an enormous
business loss which they had not foreseen, and was consequently a
great business blunder.
The end is not yet. We are only in the midst of this craze, which,
as has been well said, was the outcome of scientific error, re-enforced
by national pride, and uniting the chief nations of Europe in a joint
attack upon silver. Now, how is this movement to be reversed ? It is
a great question; those who have carefully studied the reports of the two
international conferences called by the United States can form an idea
of the extent and intricacy of the subject. People talk of the lack of
success of those conferences. They do not comprehend how vast a
matter, we were trying to handle ; nor do they comprehend the innu-
merable difficulties in the way arising from national pride, blind sel-
fishness, and a reluctance to being taught, which the commissioners
had to meet,
Now, let me turn to the question, how has our coinage of the silver
dollar operated upon Europe?
I affirm with certainty that it has operated injuriously to the success
of the effort to restore bimetallic free-coinage. There is one thing, Mr.
Speaker, which we may take for granted: there is a good deal of
human nature in Europe as well as in America—Europeans are men,
and they are not devoid of sense. If you or I were European and lived
in the midst of prejudice as general as that which induced the poli-
ticians of European nations to commit themselves to an anti-silver
policy, and when those great bodies, which move so slowly, had already
moved and taken a stand, I think we should consider it a very pleasant
thing if a powerful and wealthy nation across the sea would take hold
and belp us out without asking any help in return.
The coinage of silver by the United States eased up the situation for
the gold monometallists of Europe. The statesmen who committed
themselves and their countries to.monometallism found allies in the
United States, and of this number not one more efficient than the gen-
tleman from Missouri [Mr. BLAND]. Outside of what the coinage of
silver has been doing all the time, it has been a constant promise for
the future that they are to be “let out” more completely. I can not
understand, Mr. Speaker, why the extreme silver men fail to see that
they are really the cat's-paws of European monometallists. I do not use
the word in any way offensively—but it is strong, in so far as they
seem to be picking the chestnuts out of the fire. Perhaps there may be
a tinge of blind sclf-interest in the ground they take, or, if that does
not suit, let us suppose that they have found the silver question a much
more momentous one than they have hitherto contemplated and do not
6
now care to face it in all its diverse bearings. Perhaps they have
thought that silver is a “local issue,” as a certain distinguished gen-
tleman once remarked with reference to the tariff. If so, they were
again mistaken.
It is more than a local issue, it is an international One, and it is be-
cause the silver men have failed to comprehend this fact that they have
gone on in their blind, selfish advocacy of a financial policy which has
operated as disastrously at home as it has abroad, and which threatens
at this moment to strike down with paralysis the commercial and in-
dustrial interests of the country.
With these views and under these circumstances I do not hesitate to
say that the coinage under the Bland act has been from the beginning
and is now a colossal business blunder. The advocates of the measure
proposed and expected it to restore the price of silver, but it has
steadily declined as compared with gold from an average price of 52
9-16d. per ounce in 1878 to an average of 48 9-16d. in 1885, and at
this time it is quoted in London an 46%d. per ounce. Such are the
facts, and here we are with the silver question still on our hands.
If it had not been for the passage of the Bland bill in 1878, I believe
that long ere this silver would have been remonetized in Europe, and
that both in Europe and the United States the mints would have been
open to the free coinage of silver as they are to gold, and that the two
metals would have been at a parity one to the other at a fixed ratio, as
agreed upon.
The true friends of silver, the people who want silver restored to its
proper place relatively to gold, as it was before its outlawry in Europe
began, all recognize this. They have said it in print continually. The
European bimetallists have fought a good fight ; they have been in
battle array all these years fighting for the cause of silver.
But during these years they have said and felt that the men in the
|United States who desire to keep up a local silver coinage when other
nations have stopped are the enemies of bimetallism. Our bimetallist
friends are there carrying on a fight against stupidity in high places,
and those who ought to be their friends, who claim to be their friends,
are all the time encouraging their enemies to hold out, encouraging
them with present help and with promises for the future ; in fact,
many of these men who called themselves bimetallists have now
thrown off the mask and are prºnounced silver monometallists,
and demand free coinage. Now, Mr. Speaker, these European bi-
metallists are the men beside whom we ought to stand and with whom
we ought to join forces; they are our friends. We ought to help them
in their struggle with indifference and prejudice in high places and
with the gold monometallists who want the single standard through
error or greed.
To do this we must follow the advice of those who know something
about the importance of the international side of the controversy, and
suspend the coinage of silver, in order that we may help our European
bimetallist friends to accomplish that which is of paramount import-
ance to us—namely, the remonetization of silver in Europe. But
why have we not done this 2 Because our people have not understood
the question. The silver mine owners, in their greed for present gains,
have not looked to the future. They have been content to take the best
price they could get for their bullion on a declining market rather than
wait until international bimetallism is restored, when their profits
would be largely increased. They have kept up a cry against bond-
holders and the “gold-bugs” of New York whereby they have deceived
the people; they have flooded the country with their publications, and
have had, as they have now, large sums of money at their disposal for
*
7
manipulating public sentiment; in fact, they are thoroughly organized;
with a headquarters in this city. "
The true friends of bimetallism are undoubtedly largely in the ma-
jority, but they are scattered and are fighting at Odds against an organ-
iz cq force, But I predict that it will be as it was in the days of the
“greenback craze,” that when the people come to understand the
question they will speak out for the suspension of the coinage of the
fººd dollar as they spoke in no unerring tone at the period to which
refer.
It may be that they will not learn the lesson except by further finan-
cial disaster consequent upon continued coinage. But, under any
circumstances, this is a campaign in which there can be but one suc-
cessful issue, namely, the re-establishment of silver in its proper place
relative to gold through international agreement. Until this is ac-
complished, there must be no surrender. The fight must be main-
tained. Coinage under the Bland law must be suspended entirely, for
to continue coinage under this law is but organized chaos for the
United States.
The continuance of the present law is sure to thoroughly disarrange
the monetary system, and to further shake public confidence. It is the
very indefiniteness of the continuance of coinage without concurrent
coinage in Europe that so completely alarms business men ; and I say
this as a representative of the business interests which are concen-
trated in and around New York. New York is the commercial and
financial center of the nation. That which affects the business inter-
ests of New York, affects the business interests of the entire country,
and vice v67'S(0. -
With some regret, I say that I have often felt chagrined at remarks
made upon this floor concerning New York; there seems to be an im-
pression that her interests are inimical to those of the great West and
South; that her merchants are moved largely by motives of narrow
selfishness, and that it is laer “bloated bondholders” who are the
conspirators against silver and who are seeking to bring about the single
gold standard for their own profit. This is an eminently unfair char-
acterization. There are extreme silver men in New York, in fact, I
see it charged in certain metropolitan journals that the seat of the
agitators (I do not use the word conspirators) for free and unlimited
silver coinage is in New York. Undoubtedly there are extreme gold
men there also, but during the last two years important lessons have
been learned, the subject has been studied in the light of new experi-
ence, and to-day New York, as a State, is pronouncedly in favor of
international bimetallism.
As I have said, New York has studied this question in the light Of
events—and New York stands to-day on the side of the minority in
Berlin and the minority in London, who are trying to get the majority
to surrender the citadel of the single gold standard and so to establish
international bimetallism. Remember, gentlemen, that New York is
a great city, and great cities sympathize with each other and naturally
look at many things in the same way. When London was shouting
for gold, Paris for gold, Berlin for gold, it was quite natural that New
York should also shout for gold. I regret that this was so, and think
that it was a mistake, but it was a very natural one.
Now, as I have intimated, the great mass of the merchants and
bankers are international bimetallists, who demand that silver be re-
stored by treaty agreement to its proper place in relation to gold, and
these men will not be satisfied until it is accomplished, for they recog-
nize it as the only true solution of the silver problem. They recognize
the fact that a gigantic business blunder was commited When silver
. 8
was stricken down by the European nations, and though some of them
may at the time have thought the course a wise one, they have long
since repented having bad any sympathy with it. Gentlemen, there
can be no general prosperity upon a sound basis in this country until
silver is restored through concurrent action of the uations agreeing to
open their mints once more to free coinage at a fixed ratio with gold.
The result of eight years’ experience has shown to the true friends of
international bimetallism that the enactment of the Bland law was a
gigantic mistake, as it has been the principle hindrance to the settle
ment of the question upon a broad international basis.
Judge Buckner, of Missouri, who served six terms in this House.
was one of the ablest advocates of the Bland bill. In a speech made
during the closing days of the Forty-eighth Congress he said:
Our people are thoroughly bimetallic, and will never be content with a mone-
tary circulation composed oxclusively either of gold or silver. Theirtuaditions
as well as their interest S Clermand the us e Of l; Oth metals—with the values Of
each regulated at such ratio as that neither shall be degraded to the condition.
of a mere money token, and lºoth shall perform their part in the commercial
exchanges of the World on terms of perfect equality.
This can only be done by the concerted action of the chief nations of Europe.
with our Government ; and to loring about this concert of action, the first step.
must lie taken by us, and that Step should be to suspend the Olyeration of the
Silver Coinage act for a time, in Whole Or in Dart, and at Once enter upon ne-
Otiations With European nations to establish a fixed ratio of valuation loetween
he two metals, and open their mints to the free coinage of both gold and silver
on such terms as may be agreed upon. If we pursue our present policy there
is nothing more Certain than that the gap between the market value of the two
Imetals will continue to grow Wider and Wider, and this country will be come
pelled to make choice between gold or silver monometallism. I would regard
either as a great calamity to this country and the world, and I have an abiding
conviction that the present is an opportune period for taking prompt and de-
cisive action on this important question.
As a business man, and speaking from a business standpoint, I say
that proposition is a Sound One. But I desire to be understood that I
am not opposing silver ; I recognize its importance with gold as a coin
of our Government. A
I have more confidence in it than the distinguished Senator from
Colorado (Mr. TELLER), if he meant what he is reported to have said
in his speech of January 19. IIis words are as follows: “Suspension
Will ºrade silver to such an extent that it will cease to be a money
metal.
In this one sentence he has given away his cause. He evidently has
no respect for the article. In his view the only thing that keeps it a
money metal is the coining of two million Bland dollars per month
Preposterous ! e
If silver had no better advocates its cause would be lost. What,
cease to be a money metal When Europe holds a thousand million of it
as full legal tender, when it is still the standard of Austria and Russia,
and when all Asia uses it as money, whether coined or not, to say
nothing of Mexico, Central America, and most of the countries of
South Americal Silyer, had it a voice, might well cry, “Save me
from my friends ! ” if they be such as the Senator from Colorado.
We can continue the present anomalous law of compulsory coinage
of two millions per month, or we can take the panacea proposed by
the honorable member from Ohio [Mr. WARNERJ, permitting the hoi.
ders of silver bullion of Standard fineness to carry it to the Mint and
receive, therefore Treasury certificates, or the plan proposed by the
honorable Senator from Ohio [Mr. SHERMAN], whereby the Secretary
of the Treasury is authorized to purchase not less than 2,000,000 not
more than 4,000,000 ounces of silver per month, of standard fineness,
&
9 ©
for which coin certificates are to be issued on the cost of the bullion ;
we can continue as we are, or adopt either of the above plans, or any
One of the half dozen other plans proposed, but, in my judgment,
they are all but temporary expedients, and should not be entertained
by the Congress of the United States.
Free coinage is what we want to accomplish, and in my opinion it
can only be done through the medium of suspension. So long as this
coinage continues and uncertainty exists as to our future course, so
long it is easy for European statesmen to put off dealing seriously with
the question. But a date for suspension would, as has already been
well said, serves as “a notice to quit.”
Opinion in Europe is reassuring on this point. In Germany the
convention of agriculturists had repeatedly discussed the silver ques-
tion in its general assemblies, and expressed itself in favor of the in-
termational double standard as being in the interest of German agricul-
ture. During the past year the distress of these interests became so
much greater that the executive committee of the convention felt it to
be its duty to address an earnest petition to the Diet, and a resolution
favoring the international double standard was passed November 12.
Up to January 11 of this year petitions for the “establishment of
the international double standard under guarantee of treaty'' had been
Sent to the chancellor and to the Reichstag from two hundred and
Seventy-eight agricultural associations. These associations (varying
in the number of their membership) represented all parts of Germany.
I find, for example, that all the provinces of Prussia proper were rep-
resented; all the provinces of Saxony, Lubeck, Hanover, Anhalt,
Westphalia, Schleswig, Holstein, Wurtemburg, Bavaria; in fact all
parts of Germany. In all eight hundred petitions had come to the
Chancellor and the Reichstag up to a recent date praying for the inter-
national double standard. That the pressure in Germany is very strong
We are getting evidences almost daily. On January 22 a remarkable
speech was delivered by Finance Minister Scholz before the Landtag.
Among other things he said: -
I have therefore observed with regret how wide a circle has been drawn into
Sympathy with this agitation, and especially that the agricultural interest, now
in a pitiful goudition, which demands our sympathy, has been led to hope that
it call find therein the means of bettering its existence.
Of course Mr. Scholz being a minister of finance puts on a brave
front as a gold monometallist, but he said of himself that he was not
“a fanatical advocate of the single gold standard,” and that he was
‘‘ not insensible to the heavy losses which had been incurred by the
demonetization of silver.” Baron Von Mirbach, (to whom I have al-
ready referred), a nobleman of Eastern Prussia and a leading member
of the Diet, in an address to the people of Germany entitled, “The
Serious injury done by the gold standard to those engaged in agricul-
ture, in the mechanical arts, to manufactures, to laborers, to all who
labor with hand and mind,” says:
The establishment of the gold standard in Germany was a serious mistake,
as the Chancellor of the Empire himself has said. It cost the country, that is
the tax-payers, over 70,000,000 marks (seventeen and a half million dollars), and
injured the entire population that lives by labor, and benefited only those who
had money.
If Prince Bismarck had not stopped the further sale of the thalers (silver) in
the year 1879 we should have suffered more than twice the loss already borne.
And further:
It is true that most people do not understand the monetary question, and
this is so much to be lamented, for no question is of such far-reaching, practi-
10
cal importance for the weal or woe of all classes of labor, nay for the happiness
of the citizen. It is much more important than the question of protection, in
fact than all the issues of economic politics, which are so much discussed to-
day. If it were only understood by the majority of the people they would raise
a storm which would sweep the gold standard away as Wind SWeeps away Chaff.
Dr, Otto Arendt, secretary of the “German association for the
double standard under guarantee of treaty,” writes, under date of
January 12, 1886.
We need both metals. The equilibrium between them has been broken by
the experiment of the gold standard. No single state is in position to 1'estore
that equilibrium ; an international agreement is necessary. All states except
England are ready for such an agreement if Germany decides to join. If We
leave this one nation in its isolation the monetary problem which seems SO
difficult will be solved. Future generations will instance among the greatest
aberrations of the human mind the idea, and the experiment of the gold Stand
ard which has brought such unspeakable misery upon the World.
On February 11 a Reuter telegram from Berlin stated that the mo.
tion introduced by Herr Huene in the Reichstag on behalf of the Con.
servatives, urging a new and searching inquiry into the currency ques
tion, with a view to ascertaining whether it would be better to adhere
to monometallism or return to a double standard, was adopted by a
vote of 145 to 119. The result is a step forward for the international
bimetallists. Gentlemen, I could produce evidence almost indefi-
nitely to show that Germany is alive to the importance of a settlement
of this question, and with a little more pressure would be ready to
agree to an arrangement, but so long as we are bound by law to con-
tinue indefinitely to grind out at least two millions of Bland dollars
per month we greatly retard if we do not directly prevent success.
With one more quotation from Minister of Finance Scholz I will make
no further reference to Germany.
In the speech to which I have already referred he alluded to the
*mbarrasments of the United States, from which he said with pride,
that Germany was free because she had stopped the coinage of silver.
Is it mot obvious that it is desirable that we now enter upon a course
whereby we may be relieved, and shift the embarrassment upon them;
in other words, allow Germany to “lie awake nights” over the silver
question instead of continuing to do so ourselves? To me everything
indicates that Germany is in a condition where pressure is sure of pro-
ducing a favorable result.
Turning to France, I think I am Safe in Saying that, judging from
her past history and from recent action, she would not be slow to
consent to enter into negotiations to establish international bimetal-
lism. From the London Bullionist of February 6 we learn that an official
decree had been promulgated appointing a permanent commission to
consider the monetary question in France and other countries. I can
say on excellent authority that there is not a prominent man in Holland
who is not an international bimetallist. The chief powers comprising
the Latin Union are France, Belgium, Switzerland, and Italy.
Concerning France I have already spoken. Of the remaining states
I can say without hesitation that international bimetallism through
guarantee of treaty will be to them the solution of a serious problem.
Turning to England, we find that ine friends of the double standard
are Wäging a hand-to-hand fight with the advocates of the gold stand-
ard, and that latterly the conflict has become very sharp. On January
22 the annual meeting of the “International Monetary Standard Asso-
ciation ” was held in London. Henry H. Gibbs, ex-governor of the
Bank of England, presided, and among other things said, that “he be-
lieved that the royal commission (of which he is a member) on the
11
depressed condition of trade in Great Britain would report that the
present condition of the silver question had an important bearing on
the depression.”
The meeting, before adjourning, resolved to form a gold and silver
league on a popular basis. At Manchester, on the evening of Febru-
ary 16, a large and important silver meeting was held, including many
members of Parliament and prominent silver advocates, Mr. Grenfell,
ex-governor of the Bank of England, a prominent bimetallist, de.
nounced the Government for refusing to answer questions connected
directly with the currency, and declared that the people had a right
to the information for which those questions called.
On the 23d of February a meeting of the chambers of commerce of
Great Britain was held ar London.
The meeting, by a vote nearly unanimous—
Resolved, That the depreciation of silver and its present tendency to disuse
as money are disturbing trade generally, and England's Eastern Commerce in
particular.
Another resolution adopted contained the following language :
We urge the Government to unite with other countries in an endeavor to
restore silver to its former function as a legal tender, thereby giving it a per-
manent instead of a fluctuating value.
Mr. Moreton Frewen, in a letter to the Pall Mall Gazette, in Septem-
ber, said :
There is no question of the day of the same importance to England as is the
question of the future of silver. We in England require to know betimes
what action Congress will take on this issue. A fall of 12 ponce in the price of
the Ounce of Silver has confracted the imperial revenue of India to the extent
of some £6,000,000 sterling, and, far worse than even this, has absolutely dis-
located our commercial relations with all those nations which use silver.
He further shows that the suspension of the coinage by the United
States of the two million or more standard dollars per month would
put England and her Indian empire in a position of extreme and, from
our point of view, well-deserved difficulty. Mr. H. Schmidt, in a
paper entitled “The Future of Silver,” read before the Institute of
Bankers in London on March 18, 1885, admitted that the proposed
suspension of the Bland act was chiefly directed at England, but not
so much directly as indirectly, through India, and that the immediate
result would be disastrous.
While I have no doubt that we could force Great Britain into a
very awkward position, and while the minority party which favors
the remonetization of silver is very active and aggressive, yet her
people as a whole are extremely conservative; and the effort might
prove unsuccessful. International bimetallism can be accomplished,
however, without England, for it existed without her from 1816, when
she demonetized silver, until 1871. It was then that Germany began
her attack upon silver in endeavoring to follow the example of Eng-
land, and became a gold single-standard country.
This brief review of the state of opinion in Europe shows that the
scheme of getting the nations to agree upon the measure of mutual
benefit which the United States proposed to them in 1878, and again
in 1881, is a practical one, based upon the enlightened self-interest of
the various nations whose agreement is sought. It shows that the
obstacle to success is the indifference, the dullness and ignorance, of
men in power in those governments; and, further, it shows the prac-
tical difficulty of getting nations to move.
12
Every member of this House realizes the difficulties of getting laws
enacted, or of getting the Departments or the Executive head of the
Government to do something new, something out of the ordinary
course, and particularly if that something implies that there has been
a blunder which will be shown by a change in the plan of action.
You, gentlemen, should be the first to recognize the practical diffi-
culty of which I speak. You know that nations move slowly, follow-
ing in the rear of an enlightened public sentiment. You, of all others,
ought to be able to see that what these high officials need in order to
get them to move faster is to be shaken up. They need to be brought
face to face with their responsibilities in the eyes of all the world,
and the opportunity ought not to be afforded of seeking refuge behind
a pretext of any character, no matter how adroit it may apparently be.
Now, gentlemen, the measure which I advocate will accomplish
this result in every nation in Europe. A date fixed by us for suspen-
sion of the coinage of the standard dollar, unless there shall be inter-
national concurrence before this specified time, is a summons left in
the hands of every European statesman who has any responsibility to
his country, to his sovereign, or to his constituents—a summons
which he cannot forget or ignore—to wake up and take hold of this
question, in order to bring about its settlement upon the only basis
which can possibly be permanent and satisfactory, the basis of inter-
national bimetalism through treaty agreement to open mints to the
free coinage of silver at an established ratio to gold. -
I shall devote the remainder of my time to some of the arguments
of my opponents.
The honorable member from Ohio [Mr. WARNER), in his remarks
upon this floor, quoted Pliny as saying that “gold was a curse.” In
Article X, on “National Problems,” he also quotes from the same
writer and uses the following language :
Pliny speaks of the introduction of the gold denarius as a “crime com-
mitted against the welfare of mankind.” If the introduction of gold coins
into the Roman republic was for the purpose of increasing the money stan-
dard, then the denunciation of Pliny was not unmerited. -
Mr. Speaker, I take it that every member has heard of Pliny, and
has a wholesome respect for an ancient Roman who could so far
triumph over the ravages of time as to transmit an anti “gold bug”
message to the Forty-ninth Congress, in a land that was not heard of
until fourteen hundred years after his death. I can imagine a “gold-
bug” writhing under the application of Pliny, and I see the con-
stituencies of silver rejoicing over the unexpected reinforcement
which they owe to the learning of the honorable gentleman from
Ohio. It is, however, my painful duty to tell the honorable gentle-
man that “all that glitters is not gold.” Information is great, but
accuracy is greater.
I hold in my hand a copy of the works of the aforesaid Pliny, and I
find him on page 111, volume 6, talking of “silver ore as another folly
of mankind.”
The melancholy fact is that the gentleman did not read far enough.
This great Roman whom he has seen fit to throw at our heads was not
an anti-gold man or an anti-silver man; he was an anti-money man.
He believed in barter: he objected to money; and his reasoning was
excellent. He objected to men’s spending time in digging after money
when they ought to have been digging after chemicals and drugs. He
was writing a book on natural history, and he was a medical enthusi-
ast and spared nothing in his praise of medical knowledge. His idea
was that men should be searching for remedies to cure diseases rather
13
than to be spending their time in making iron for Swords, or mining
silver and gold for luxury and treasure.
But, gentlemen, I am not here to vindicate Pliny, nor to pick flaws
in the literary productions of the member from Ohio, but I stand before
you to bear testimony to the fact that the entire argument of the ad-
vocates of the standard silver dollar rests upon flimsy foundations. It
will not pass inspection; it is bound to break down. The same inac-
curacy which I find in this citation from Pliny goes through the entire
argument of the extreme silver men.
Take, for example, the minority report on the bill (H.R. 5690) now
before the House, signed by Mr. BLAND, Mr. LANTIAM, and Mr. BY-
NUM. I find on page 10 a statement about the various countries of the
world and their money. Here is a list of gold standard countries—
countries where this metal is the standard money, where any owner of
gold bullion can take it o the mint and get it turned into money at
8.T.
p Below is a list of silver standard Countries where silver has a like
position. Then comes a list of double-standard countries, where one
would suppose that gold and silver were the standard, and where the
owner of gold or silver bullion could get it coined into money at par.
Among others the United States of America is down as being a double-
standard country. How is this 2 Can any owner of silver bullion take
it to our mints and get it coined at all, or, in fact could he go to any of
the important countries in that list with his silver and get it coined into
money at par 7 No; of course not; SO here is a false statement, as I
look at it. Can any one maintain that that statement is not meant to
mislead 2 But where did that statement originate 2 It comes from the
report of the Silver Commission of 1876, printed the following year,
before the enactment of the Bland law in 1878, and when gold was the
standard of value and sole full metallic money. The statement is mis-
leading to-day; it was more misleading in 1877.
France is in the list as being a double standard country; Belgium,
Italy, Switzerland, the Latin Union, which stopped the coinage of sil.
wer on private account in 1874 and stopped it on government account
in 1878. France a double-standard country, when it is ten years since
she has coined silver ! Holland has coined mone since 1875. It is char-
itable to suppose that the men who prepared that statement in 1876
were asleep, and that they thought every one else was asleep. Such
misrepresentation of facts as these are all made in one interest. The
report of 1877 was made in that same interest. The very basis of the
argument of this interest is full of fallacies.
Why, gentlemen, if this table gave a true picture of the monetary
condition of the commercial nations we should not be arguing this
question in this House at this time, for we should not have any “silver
question ” On our hands. The standard dollar would be worth a dol-
lar and three cents, instead of eighty; in fact, it is a question whether
the trade-dollars and the standard dollars would not go to the melting
pot to be sold as bullion to be exported to the double-standard coun-
tries, where it could be converted into money at the ratio of 154 to 1.
If the Latin Union and Holland were true double-standard countries,
as the table represents—that is, if silver could be taken to their mints
and coined into money at the ratio of 154 to 1—we should practically
be in the condition we were in before the War, a double-standard
country, but with gold alone flowing to our mints for free coinage. You
can see why it was worth while for an attorney of the silver interest to
prepare such a table; it is misleading and Calculated to deceive, whether
intentionally or through error I leave to you to decide. Whoever places
any reliance upon it gets a distorted view of the situation. It ignores
14
the main facts that every one should know who has to deal with the
silver question.
I appeal to my friends on the Committee on Coinage, Weights, and
Measures, who signed the minority report, to expunge that table from
said report. I suggest to those gentlemen who have published it in.
their speeches to add a postScript, or to follow them, as they have been
sent out, with a circular letter to this effect: “Error corrected. In-
stead of double-standard countries, as published in my speech, please
read countries which were once double-standard countries but which
are no longer such as they coin only gold.”
Then follows the list of countries; after which add, “These countries;
hold more silver than the United States holds of gold and silver to-
gether, and if Mr. BLAND's bill should become a law these countries
may be expected to send silver sufficient to buy up all of our gold and
leave us with the silver standard. In any case, this measure would ruin
the prospects of international bimetallism.”
For ten years the agitators for immoderate coinage here have held
out this prospect to time gold men of Europe, and so have helped to pre-
vent the success of bimetallism. These agitators for immoderate coin-
age are the men who have done most to keep down the price of the pro-
ducts of the West and South. Here is something which my friends
BLAND, LANIIAM, McCREARY, LAFFOON, and CLEMENTs, of the House,
and Mr. JoWES, of the Senate should have pasted upon their speeches
and reports. If they do not do it themselves some one must do it for
them. 3.
Gentlemen, this line of tactics is not confined to this FIouse, but it
has invaded the Senate, spreading itself upon eight columns of the Rec-
ord; I allude to the memorial of an association which is called the
National Bimetallic Coimage Association. The true object of this as-
Sociation is the immediate sale of silver through inducing the repre-
tatives of the West and South to sacrifice their real interests to the im-
agined interests of silver States. Senator JONES, of Nevada, intro-
duced this memorial on March 11. We find in it the same erroneous
Siately)CInt.
I read from the Comgressional Record of the 11th instant:
THE FALLACY, “DUMPING-GROUND FOR SILVER.”
With the re-establishment of the free coinage of silver in this country we
have been told that the United States will become the dumping-ground for
foreign silver. This assertion manifestly resis on error, and a review of the
rates of coinage of the several leading 11ations in this world will soon dispel
all just grounds for such apprehension. On the contrary, with the free coinage
of silver re-established in this and other silver-using countries in Europe we
shall be confronted with a drain upon us for our silver dollars. Our coinages
and that of Mexico are as 1 to 16, Which means We gives 16 pounds of Silver for
every pound of gold. The Latiu Ulliou, Oll the Contrary, coins at the rate of 1
to 15%; Great Britain in l'espect to subsidiary Coillage as 1 to 14.28. The Ger-
man Empire as well as all the other Inations of South and Central America, coin
as 1 to 15%, hence the loss On their coins WOuld alone prohibit the exportation
of their silver to this country. §O far as Mexico with her standard of 1 to 16,
equal to our own, is concerned, We have no reason to apprehend any injurious
inaportation of her Silver.
Please observe, gentlemen, that the Latin Union coins and that the
German Empire coins. Gentleman, as I have already shown, the
German Empire ceased coining silver in 1871, Holland in 1875, France
and her allies in 1876; hence, they are no longer double-stand-
ard countries; therefore this statement is misleading, it is incor-
rect. Those countries are no longer double-standard countries. No
one can take silver to the mints of those countries and have it coined
15
as they can gold, they are single-standard countries. And the memo-
rial contains other equally fallacious statements.
I ask all candid men if I am not warranted in finding evidence of a
conspiracy of silver men to deceive the people and to mislead their
representatives in Congress. The Silver Commission of 1876 and 1877,
minority report of the Committee on Coinage, Weights and Measures
of this Congress, and the memorial just alluded to all pervert facts
upon the silver question. What does it mean Ž It means a good many
things, but among others, and an important one to the silver mine
owners, it means a market for their production. They want to sell
their silver; they claim protection from the Government; in fact,
it has occurred to me that it would be cheaper for the people if the
Government did protect them by paying a subsidy to the mine owners
rather than by pursuing the present unfortunate policy.
In my judgment the silver mine owners have gone too far; they
have overestimated themselves. If they had been more modest in their
claims they would bave realized more than they have done. It was
their fortune to have their private interests tied fast to one of the great
interests of mankind, and they were so elated that they began to think
they could control the monetary interests of the country, The silver
men are trying to run the silver question, and the most they have done
is to do harm to the cause of silver. Alas, for silver, if it only had
such friends as these.
Now, gentlemen, let us take another long look at the principal facts
that concern the past, the present and the future of silver. These facts
are, that down to a few years ago a combination of the chief nations
coined all the silver that was offered at the mints at a fixed ratio to
gold, which combination was broken up in the manner I have ex-
plained This Government started a movement to get the nations to
combine in restoring silver. That work is now in progress. It is in
the hands of its friends in Europe who are working their way toward
success. They ask our help; they ask us not to weaken them by con-
tinuing our coinage at the ratio of 16 to 1.
And now comes the same old cry for free and unlimited silver coin-
age, which from the beginning has encouraged the gold men of Eu-
rope to hold firm in the position they have taken. Gentlemen, I ap-
peal to the sober second thought of this House to stifle this cry, which
is really, though its authors may not know it, treason to the true in-
terests of the country. -
Gentlemen, this country is for bi-metallism; it is for the restoration
of silver to its former rights side by side with gold, rights which it
had and which were guaranteed by international concert, and Which
shall be given and guaranteed by international concert again. The
country, I say, is for an international ratio. This eountry is not in
favor of a local ratio.
Let me tell my colleague on the committee [Mr. BLAND] that We
are neither red Indians nor Chinese; that this ratio of 16, or more Cor-
rectly 15,988, on which the present dollar is coined is not a “totem ’’
nor “medicine” nor a little “joss'’ to our people. What they Want
is to see silver as good as gold, and no local ratio can accomplish that
result. The ratio of 16 to 1, and free coinage, means the silver stand;
ard. I congratulate the three members of the minority who signed
the minority report that they have been frank in saying that they “see
no harm in coming to a single silver standard.” e e
Now, Mr. Speaker, this country does not want the single silver
standard. The people will not have it. The only reason why they toler-
ate the existing coinage of silver is because they have not fully under-
16
stood the question. Error has been spread abroad throughout the land,
and the Government Printing Office is being further used for its dis-
semination. It is time to call a halt, and I appeal to all men who care
for the best interest of the people to unite in an effort to suspend com-
pulsory coinage and for the accomplishment of international bi-metal-
lism. [Great applause.]
A D DITION A. L. R. E.M. A. R. K. 8
HON. DARWIN R. JAMES,
OF NEW YORK,
IN THE HOUSE OF REPRESENTATIVES, APRIL 2, 1886.
Mr. SPEAKER. I desire to add to my remarks of March 20, 1886.
The following lines are a part of the platform of the Republican
Convention of the State of New York, adopted at Saratoga, Septem-
ber 23, 1885:
“The restoration of silver to its former position through equality
with gold before the law in a majority of commercial nations must
remain, until accomplished, the chief aim of our monetary policy.”
The platform adopted by the Democratic Convention at Saratoga,
September 25, contains recognition of the same idea:
“But we will welcome any practical measure of agreement with
other nations by which the ratio of value between gold and silver may
be made less fluctuating.”
FROM ANNUAL REPORT of THE SECRETARY OF THE TREASURY (Mr.
SHERMAN) ON THE STATE OF THE FINANCES FOR THE YEAR 1879.
The Secretary cannot too strongly urge the importance of adjusting
the coinage ratio of the two metals by treaties with commercial na-
tions, and, until this can be done, of limiting the coinage of the silver
dollar to such a sum as, in the opinion of Congress, would enable the
Department to readily maintain the standard dollars of gold and silver
at par with each other.
FROM ANNUAL REPORT OF THE SECRETARY OF THE TREASURY (Mr.
SHERMAN) ON THE STATE OF THE FINANCES FOR THE YEAR 1880.
It may be better for Congress at the present time to confine its action
to the Suspension of the coinage of the silver dollar, and to await ne-
gotiations with foreign powers for the adoption of an international
ratio * % 3& 33. 3% º: % % 34. + º º
FROM ANNUAL REPORT OF THE SECRETARY OF THE TREASURY (Mr.
FOLGER) on THE STATE OF THE FINANCES FOR THE YEAR 1881.
The most potential means of bringing about any concert of action
among different nations would appear to be for the United States to
Suspend, for the present, the further coinage of silver dollars. This is
the decided opinion in both France and America, of the highest au-
thorities on bi-metallism, and of those who wish to bring silver into
general use and raise its value ; and it is believed that a cessation of
coinage would, at a very early day, bring about a satisfactory consid-
eration of the whole subject among the chief commercial nations.
(The recommendations of the Secretary were repeated by reference
in his reports for 1882 and for 1888.)
FROM ANNUAL REPORT of THE SECRETARY OF THE TREASURY *MR.
McCULLOCH) ON THE STATE OF THE FINANCES FOR THE YEAR 1884.
The United States is one of the most powerful nations—its credit
is high, resources limitless; but it cannot prevent a depreciation of
silver unless its efforts are aided by leading nations in Europe. If the
coinage of silver is continued in despite of the action of Germany in
demonetizing it and the limitation of its coinage by what are known as
the Latin nations, there can be but one result; silver will practically
become the standard of value. * * 3} º: 3. 3}
The European nations which hold large amounts of silver must
sooner or later come to its rescue, and the suspension of coinage in
the United States would do much to bring about, on their part, ac-
tion in its favor.
FROM ANNUAL REPORT OF THE SECRETARY OF THE TREASURY (Ma.
MANNING) ON THE STATE OF THE FINANCES FOR THE YEAR 1885.
The choice before Congress is not between silver monometallism
and gold monometallism. Both are inadmissible. The choice be-
fore Congress is not between bimetallisin and either gold or silver
monometallism. The latter are not admissible, and bimetallism is
only possible with the co-operation of other nations, which is not now
to be had. For, although France holds the same friendly attitude,
and would be followed by some of her associates of the Latin Union,
England now, as in 1878 and 1881, is willing to depart from her mint-
age of gold alone into coins of unlimited legal tender, and Germany
now, as in 1881, regards the concurrence of England in an interna-
tional bimetallic union as a sºme qua 7.0). % -3% % 3: *
The only choice before Congress, therefore, is the choice between
one-metallism and two-metallism. The silver dollar cannot be kept
in equivalence with the gold dollar if the coinage of silver continues.
The gold dollar cannot be kept in full domestic circulation if the silver
dollar is suffered to fall. Coining more necessitates its fall. Doubt-
less some may hope that more silver dollars can be coined, and yet
their equivalence with the monetary unit not be lost. It is respect-
fully submitted that there is no compensation for that risk, and that a
judgment so accordant of the great business classes who carry or the
exchanges of the country must be accepted as a final estimate of that
risk.
Nor should it be forgotten that every silver dollar coined hereafter
at our present ratio would be, as the coining of every silver dollar
since 1878 has been, a direct hindrance to the international bimetallic
union then avowed as the object of our legislative policy.
EXTRACT FROM HOUSE Ex, DOC. No. 100. 49TH CONGRESS, isT SES-
SION. LETTER FROM THE SECRETARY OF THE TREASURY TO THE
SPEAKER OF THE HOUSE OF REPRESENTATIVES IN RESPONSE TO A
RESOLUTION OF THE HOUSE, ETC., MARCH 2D, 1886.
It is now become plain, to all who take comprehensive and practical
views of public policy, that the United States can do no better than
return at the earliest possible date to a bimetallic unit of value. By
this I mean— N.
1. The monetary unit embodied in coins, both of silver and of gold.
2. The monetary unit of value embodied in the silver coin to be
made and kept in that successive and simultaneous equivalence with
the present and prior unit of value which has been our honorable dis-
tinction ever since the Constitution was framed. -
8. Open mints for the free coinage of gold and silver at a fixed ratio,
to every citizen of the United States bringing either metal, and the
- - 19 - - - - - - - - - - - ---------.” ---,
right to have his coins received in every sale and payment as full legaf
tender dollars.
Nothing less than this is bimetallism. It is not bimetallism that we
are having now. All our silver coinage is but excessive subsidiary
coinage of Treasury purchases of silver for a fictitious Treasury profit.
We lack an indispensable part of bimetallism. We lack the free coin-
age of everybody’s silver, to an amount unlimited by Government, into
coins of full legal tender. We only maintain a free coinage for every-
body’s gold, to an amount unlimited by Government, into coins of full
legal tender.
t is the facts of our present situation, I would respectfully reassert,
that constrain us toward bimetallism as Our goal.
Our $550,000,000 coined gold, our $220,000,000 coined silver, now
make any policy save ultimate bimetallism for the United States, prac-
tically and politically a Utopian policy.
Stopping the coinage of Treasury purchases of silver is not a policy
in which we can rest and be thankful. It is merely the first and
indispensable step to ultimate bimetallism. It is also the only step to
ultimate bimetallism. No intelligent expert on either side the At-
lantic has proposed or attempted to defend any other step to ultimate
biri etallism. -
It is a wise step in the interest of industries jeoparded by doubt, to
end the increasing risk of expelling our gold. But it is a step neces
sary in the interest of silver owners, because continued silver-dollar
coinage, after long trial, neither betters the price of silver nor narrows
its fluctuationas, and tends to prevent rather than promote that inter-
national concert which, by restoring open mints for silver in three or
more great commercial nations, can alone restore its price. No mint
in the world which gives flee coinage to gold now gives free coinage
to silver. Except our own, no mint in the world which give free coin-
age to gold now coins full legal tender silver. We alone heap up the
load. The sure outcome is silver monometallism for us. Meanwhile
what good has eight years of it done the silver owners ? Not a dollar
of their coin or bullion crosses the Sea and there brings its former
price. But silver monometallism in the United States will not restore
silver to its old price any more than the sileer monometallism of India,
China, and Mexico do. It will not even tend to restore silver to its
old price, and so is condemned as an incapal le, unprofitable monetary
policy. In that respect, it is worse than our present limited coinage
of Treasury purchases, prior to the day of their outcome in silver
monometallism. It is even worse for the ultimate price of silver
than if we stopped such coinage and held on so, indefinitel, . The
reason is plain, Silver monometallism in the United States, in due
tinue, and finally, will release to Europe the bulk of our $550,000,000
old, and assist every once bimetallic nation there to follow Great
ritain and the Scandinavian States in becoming and remaining a
gold monometallic nation, with but token silver for small change.
Silver monometallism in the United States, in due time and finally,
will release the depreciated full legal-tender silver of European bi-
metallic nations to compete with the product of our own mines for a
passage through our mints. Assume that we could exclude it by
stringent laws—though it is a strange assumption—foreign silver
would distance ours in the race for the Orient, with which we trade
mostly through Europe now, and with which we have so little trade,
but Europe so much.
The transfer and exchange of a part of Europe’s silver stock for
the bulk of the United States gold stock might be indirect in part,
20 * - *
but it would be unavoidable. The open mint for silver in France
was all that Germany used or needed to effect the substitution of her
silver for the gold of France. That is what silver monometallism in
the United States would at last come to, undeniably—the exchange of
European silver against American gold ; and that could not raise
the ratio of silver to its old level, but would fasten it down finally.
Even were this indirect but ultimate exchange of our gold for Eu-
ropean silver hindered by any present tendency of coin balances to
continue in our favor, it is still but an affair of time. There are other
arguments, too complex to be met incidentally ; but whatever their
force, the disuse of gold by the United States would be compensated
by its increased use in Europe, and thus prevent its loss of purchasing
power. So our increased use of silver, tending to enhance its purchas-
ing power, would be countervailed without benefit to the United States,
by its diminished use in European nations, thus preventing its gain of
purchasing power, whether their legal-tender silver stocks were
drained off to the West or East. The bimetallic theory of an ever-
balancing approximation of the two metals to a fixed ratio, whatever
the variations in the natural increase from mines of either metal, has
no application to the case of Substitution here supposed, any more than
it had to the substitution which Germany effected at the expense of
France. The emigration of our gold to Europe would not restore the
price of silver.
There is one way, and only one, by which silver can be restored to
its old ratio and value, namely an international concert upon a com-
mon ratio with open mints to both metals at that ratio. -
A concert of European powers without the concurrence of the
United States is impossible, for this reason. The ratio of gold at .
which most of the European silver stocks have coined is 15.5:1. Our
ratio is 16:1. A merely European concert of nations would make
profitable the export of all our silver, and we should be drained of the
metal as we were, by the same difference of ratios, from 1834 onward,
when our loss induced in 1853 our first subsidiary coinage of fractional
silver.
A concert of the European powers together with the United States,
until we stop coining silver, is impossible for the same and another
reason. It is impossible while ratios differ, and while we persist in
that which is not only different, but which would both drain us of all
except fractional silver, and inundate them with our coined $220,000,-
000 and whole future annual product. But moreover the step is one
which no European nation, now loaded with a depreciated but full
tender silver coinage, will consent to take while the direct or indirect
substitution of European silver for the United States gold seems a pos-
sibility, even a remote one. . It is perceived to be a near possibility
under the continuing operation of our present laws, by those who con-
trol, with firm hand, the monetary policy of foreign powers.
So long as we do not stop, and stop unconditionally, our coinage of
full legal-tender silver, we cannot destroy foreign hopes of enlarging
their stock of gold at our expense. But I am equally well assured,
that when we do stop, and stop unconditionally, and destroy such
hopes, such an international concert as I have described will then be-
come possible. The situation of bimetallic European nations will then
be no better than ours, and, for the first time since the fall in value of
their full legal-tender silver, will offer no other remedy or outcome
than an agreement, with Suitable precautions, upon open mints at a
fixed and common ratio, to which the assent of the United States would
be indispensable.
2 w
6 a 4 // ? 3
Fluctuation of Gold
*"---...-::= -r---
- 5 ſ //7
*-*--------- *** ----------------
BIMETALISM.
AND
*
The accompanying Diagram gives the Curve of Variation of Value of
Gold and Silver respectively, in commodities, between 1860 and 1886. The
table of prices and method of computation of W. M. Grosvenor, N. Y. edi-
tor of The Public, have been adopted, and the prices of 1860 taken as a
basis of comparison, commencing with the prices of Nov., 1865. The line
of constant quantities of products represents 200 leading commodities pro-
portioned according to consumption, and taking such an aggregate as $100
would buy in 1860.
In May, 1866, it required $126.04 in gold to buy the quantities, that
is, the value (purchasing power) of gold fell to .79. 1868 was the year
of our highest prices, and gold had an average value for that year of .716,
a point below the capacity of the Diagram.
In 1873 the silver dollar, having been about 3 per cent, more valuable
than the gold, came to a commercial equivalence with gold at the legal ratio
of 16 to 1, and refusing to take the galloping pace of ascent with it, there
occurred the “The great fall in the price of silver.”
In August, 1885, after violent fluctuations $84.56 would buy the con-
stant quantities, showing an increase in the valāe of gold of 34 per cent.,
while our silver dollar at 16 per cent. (bullion value) below it, puts it at
112} on our scale.
It thus appears that since this “fall of silver” gold has fluctuated 40
points to silver 25—gold having almost doubled in value from 1868 to 1885.
For the last 26 years, and especially since 1873, the great superiority of
silver over gold in stability of value is manifest; and who shall compute the
losses, hardships and injustice consequent on the base Act of 1873, and
implied in those mountain peaks on the Diagram as of 1878 and 1885 !
The effect of legislation upon the value of gold, first to depress it by
irredeemable paper, and then to enhance it, by withdrawing silver competi-
tion in the money faculty, is also manifest. '
Money constituted of both gold and silver without limit rose according
to Jevons from 100 in 1809 to 245 in 1849, when California and Australia broke
---
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* * rt Şt , 2. : "... " ºr ! .. s
X_{ CCŞt - ſº , ( & | ºf C ( ; •Ü.
2
in upon the stagnation and gloom of the world, and, despite the unparal-
leled waste of great wars, gave us a quarter of a century of industrial pro-
gress such as had not been equalled in any 250 years of history.
It is said that Progress in Arts and economy of productions and not
any change in the money supply has lowered prices so. These people for-
get that value is a quantitive relation—a ratio between two terms, and in the
very nature of things a change in the quantity of either term without a cor-
responding change in the other, changes the value of both. Since it is
neither desirable nor possible to stop the progress of production of commo-
dities, and stability of value of money is desirable, it is only left to us to so
constitute intrinsic money—definition money—as to make it amenable to the
same increase of efficiency in production as takes place in the commodities.
it transfers and measures. That, certainly, is not compatable with a gold
standard. So little amenable is gold production to improvements in the
arts, that the accidental discovery of placer deposits gave us a yield in J852.
30 times as large as in 1825, and the yield has been constantly diminishing
ever since, while silver mining is a steadily growing industry.
A gold level of prices (it seems a bitter irony to call it level) is industrial
disaster, a snare to enterprise, and a paradise for wreckers and “finan–
ciers.” Without the leveling influence of silver, its world old ally and rival
the gold standard is an oppression and a conspiracy against civiliza-
tion itself, that for subtelty and intensive power for mischief surpasses.
every thing before concocted by the selfish ingenuity of man.
Money legislation for the last quarter of a century is the illicit offspring
of security mongering upon a vain idealism of international symmetry and
par of exchange, while the lawful mistress of the Economies—industry and
wealth creating enterprise, have been despoiled by more stringent defini-
tions and limitation of ultimate money.
Bankers and financiers take it as a matter of course that invention and
increase of productive power and skill shall by lowering the prices of all
products inure to the benefit of the mortgagee and not to the owner of the
plant. Everything may yield to the increasing efficiency of labor except
money. Government honor, they claim, is implicated, not merely in main-
taining the weight of its coins, but must have a “policy” that enhances and
maintains its value even if an increase of weight is necessary to it; and so.
injecting a new meaning into every contract and outstanding obligation.
A bimetalism that only uses silver for a subsidiary coinage the same as
nickel and copper, only a little more largely, is a spurious bimetalism.
And those persons who suppose a commercial equivalence at the legal ratio
and a concurrent circuſation of both metals in this country is necessary in
order to a realization of the benefit of the double standard, have not mastered
the elements of the subject.
Whether our Money Constitution should be such as that the
British unit shall bear a fixed relation to it of 4.86, or composed of the
other metal, as to allow the pound sterling to fluctuate from that value.
.*
3
relation up to six, seven or ten is a matter of comparatively trifling
moment. The great desideratum in monetary legislation is to secure such
a constitution of it as without departure from established definitions and
contract obligations, will insure stability and uniformity through long
periods, not necessarily with foreign money but with our own productions.
The arguments against the honesty of silver payment do not rise to the
dignity of serious criticism.
Government has no obligation towards creditors as such except the
enforcement of contracts in the precise terms in which they are made.
It has no office whatever in relation to value changes that may have
occurred in the interval. To increase the value of money by cornering Ol'
other limitation of supply is indeed good financiering, but it is infamous
legislation. It is a great beneficence whenever it so transpires that there
is a gradually lessening power of money over commodities and services.
It is in the line of a true progress that a day’s labor shall have an ever
increasing efficiency and command over all forms of wealth, money included.
Civilization is precisely that. He is an enemy of his race who would
invoke the powers of the State to resist that movement, and that govern-
ment is recreant to its high office that does not foster and further that
Supreme social progress.
With free coinage the commercial equivolence between bullion and our
standard coin will be at once established, and our dollar familiar to the
world now for more than a century will be everywhere current at the 1C0
cents which it is, and from Wall street to “far Cathay,” and all between
the Poles, will be in eager demand at “exactly 100 cents” for the purchase
of every marketable thing, foreign money included.
It is a sinister criticism against our initiative in this business, that it
will tend to reduce the pound sterling to a normal value and restore Brit-
ish prosperity. The initial and chief stress of economic benefit of remon-
etization will be here, and the whole commercial world will share its overflow.
This question has come to stay and will not down at the bidding of
Wall Street or a Presidential Veto. In a popular government, with an
enlightened public conscience, one of two things—either a free and frank
restoration of the legal right to unlimited use of both metals for money,
or the abandonment of the Whole theory of metalic money and the supply
regulated by direct legislation. But yoked to a past of such gigantic
interests and obligations, all created upon a basis of both metals, their must
be no tampering with long established money definitions and no limitation
of the number of standard dollars, but the relegation of quantity and con-
sequent unit value of intrinsic money must be left to the productive ener-
gies of a free people. That will take the whole business of money supply
out of sinister and capricious control, will make it sincere, trustworthy,
calculable and normal in amount and value. -
E. D. STARK.
CLEVELAND, OH ſo, March, 1886.
ſool
#|-,+,+ * ºf cp A. 4. T # -T º cp is L. CO sº 4. # ºl 4. - J. º Lib- A:
39|| DIAGRAM OF FLUCTUATIONS. Á |
25 - Gold as compared with an aggregate – —-mº , - +
120 — Silverſ of 200 leading Commodities ap- | * N -
|| | portioned according to Consumption as | \ | |
II5 lby Census of 1880, adopting computa- | §
up tion and table Of Prices Of W. M. Gros- A | # \ |
W. venor. Prices of 1860, taken at 100 par. / N /\ \ | i
|05 --- / / \ i
CONSTANT QUANTITIES OF PRODUCTS!
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CLEVELAND.0.



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