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 THE LIBRARY 
 
 OF 
 
 THE UNIVERSITY 
 
 OF CALIFORNIA 
 
 LOS ANGELES
 
 I 
 
 Gold 
 
 Cbe Further Kisitig of 
 Prices and tbe Coming 
 Financial Storm 
 
 BY C. A. BOWS HER 
 
 Every American should now prepare his 
 mind for the coming financial storm. The 
 crisis of 1907 is but the prelude. It is the 
 token of a greater and more destructive 
 blow. By knowing of the absolute standard 
 of value, the American people can success- 
 fully ride the coming financial storm and 
 be masters of their circumstances. 
 
 This is the first treatise ever to present 
 
 an absolute standard of value for the 
 
 system of finance. 
 
 PRICE TWENTY FIVE CENTS 
 IN THE UNITED STATES
 
 Any financial system not based on the 
 machine power of industry is now false. It 
 has no relation to business. 
 
 1910 
 COPYRIGHT BY 
 C. A. BOWSHER 
 
 When the quantity of tbe media of ex- 
 change effects the prices of commodities on 
 the market, there is no money system. It is 
 but a refined system of barter.
 
 Let us understand our problems before we 
 
 solve them; 
 Let us knozv our ills before we take the 
 
 cure. 
 
 General 
 
 EVERY American should now pre- 
 pare his mind for the coming fi- 
 nancial storm. The crisis of 1907 
 is but the prelude. It is the token of a 
 greater and more destructive blow. The 
 present discussion of high prices and 
 the rising cost of living begins the open- 
 ing of a great and profound movement 
 which is to dominate not only the think- 
 ing of the American people, but that of 
 the entire civilized world. In the formu- 
 lation and solution of this great world 
 problem of finance, the American people 
 by their natural position are compelled 
 to take the lead. 
 
 Rightly to understand this question, 
 a point of view must be assumed such 
 that the greater factors of the problem 
 van be seen in their proper working rela- 
 tions. Their program of operation must 
 be plainly discerned and its necessary or- 
 der of development must have a rational 
 scheme of interpretation. In the Ameri- 
 can business world is to be seen the per- 
 formance of this movement in its great- 
 
 488368
 
 The Further Rising of Prices 
 
 est variety and most intense forms of ex- 
 pression of any place on the earth. The 
 more interested the American people be- 
 come in the cause of rising prices, the 
 more necessary is it that they shall think 
 correctly about it. Who can give the 
 best interpretation of this universal pre- 
 dicament of mankind and its probable 
 outcome will gain the undivided atten- 
 tion of the world. 
 
 With the proper perspective, it can be 
 easily seen that the prices of all commodi- 
 ties will continue to rise and the worth 
 of all gilt edge bonds will continue to 
 fall until the financial world shall discard 
 its depreciating standard of value. Who 
 intends to be edified to any great extent 
 on this subject of which the rising cost 
 of living is but an episode, must ever 
 keep in view the ultimate establishment 
 of the absolute standard of value. Other- 
 wise, the seeker after truth on the prob- 
 lem will be like the scout without a trail 
 or the pursuer without a clew. 
 
 The American j)eople delight in think- 
 ing big things and doing big things in a 
 big way. They are of the spirit. They 
 are the practical idealists consummate. 
 This has been their characteristic since 
 the foundation of their government. They 
 have a great destiny and they feel their
 
 The Growing Use of Machine Power 3 
 
 sense of being limited unless some great 
 problem is before them for solution. The 
 present problem is surely American. It 
 is the greatest problem yet presented for 
 the contemplation of man. To solve it 
 correctly means to probe to their bottoms 
 and to their every extremity, every philos- 
 ophy and every psychology now domi- 
 nating the thought of man. It will result 
 in the establishment of an American phi- 
 losophy as no other system of thought 
 will be able to reduce the problem to 
 comprehension. Such is the requirement 
 to establish in the world system of fi- 
 nance, the absolute standard of value. 
 
 The meaning of value, of the depre- 
 ciating standard of value and the abso- 
 lute standard of value must be thor- 
 oughly understood if any satisfaction 
 whatever is to be got as to the outcome 
 of this persistent rising of prices. The 
 discussions in congress and legislature, 
 in pulpit and chair and in forum and press 
 will result in so much persiflage if some 
 criterion cannot be found for the guidance 
 of the inquiry. No political economist 
 so far, has yet presented a scintilla of 
 agreeable information on the subject of 
 value. Many of them have given it up 
 as a mysterious and undefinable proposi- 
 tion. Value means power.
 
 The Further Rising of Prices 
 
 The establishment of the American re- 
 public was contemporaneous with the ad- 
 vent of machine power. The develop- 
 ment of the American republic has been 
 proportional to the development of the 
 machine power of industry. Its progress 
 and welfare are now wholly dependent 
 upon the adjustment of this machine 
 power to its system of finance. The 
 amount of machine power operating in 
 American industry is now over 100,000,000 
 horse power or 800,000,000 man power. 
 It is increasing at a prodigious rate. It 
 is the most fundamental and important 
 thing to understand in the whole ques- 
 tion of rising prices. An unit of energy 
 is the absolute standard of value. It is 
 an unit of machine power. It is the kilo- 
 watt hour. 
 
 The advent of machine power has 
 changed the thinking of all men as to 
 the problem of getting a living. Prior 
 to its appearance, it was considered 
 proper by many to look upon poverty as 
 a natural, an honorable and a necessary 
 condition of man. Its advances toward 
 the American, however, are hotly re- 
 sented. The rising of prices faster than 
 the rise of wages and salary or the fall- 
 ing of prices below the cost of production 
 provokes him to instant alarm. Either
 
 The Depreciating Standard of Value 5 
 
 of these trends of prices brings great 
 portions of the people toward the line 
 of poverty. Prior to 1896, it was the 
 rural people, the populist and the gran- 
 ger, to complain. Since 1896, it has been 
 the city people to complain and great is 
 their cry now heard throughout the land. 
 
 Before the advent of machine power in 
 the affairs of business, man power was 
 the basis for rating and performing all 
 work. Man power, therefore, was the 
 basis of the prices of all commercial 
 things. Some of these things so rated 
 were silver and gold. It was agreed by 
 statute that 1.29 units of man power were 
 necessary to get an ounce of silver and 
 20.67 units of man power, to get an ounc^ 
 of gold. These notions were established 
 when flour was worth $16.00 a barrel, 
 wrought iron $100.00 a ton, and traffic 20 
 cents a mile ton. 
 
 Since that day, business has more and 
 more adapted itself to the use of machine 
 power. No commodity on the market 
 today would be possible of production 
 without its use. It is infinitely more ef- 
 fective than man power in the production 
 of wealth. The prices of all commodities, 
 therefore, have been greatly reduced since 
 the days of Washington. They reached 
 the lowest record in 1896 when the
 
 The Further Rising of Price* 
 
 American people decided to buy silver 
 on the machine power basis of production 
 rather than on the man power basis as 
 was fixed by congress in 1792. 
 
 Since 1896 the entire business world 
 has turned its attention to the only other 
 commodity whose price is set on the man 
 power basis. The various crafts of busi- 
 ness have now begun in unison to raise 
 the prices of their commodities on the 
 market against this remaining commodity 
 of privilege which, of course, is gold. 
 Every compact and combination for the 
 control of prices, whether of individuals 
 or of corporations, is but exponent of the 
 necessity of business for the demonetiza- 
 tion of gold. The excessive profit in min- 
 ing the yellow metal compels all other 
 lines of trade, in no small degree, to strive 
 to form craft monopolies to hold their 
 proper prices on the market. Any restric- 
 tion against these formations is now ob- 
 viously an egregious error in business. 
 
 The coming financial storm, therefore, 
 is the coming turmoil of corporate busi- 
 ness in getting rid of its gold standard 
 of value. The force of high and rising 
 prices is also operating with increasing 
 intensity in the banking world. It is un- 
 dermining credit. It is reducing all bus- 
 iness to a speculative basis. The worth
 
 The Development of Crafts 
 
 of all gilt edge bonds will continue to 
 decrease as the financial standard con- 
 tinues to depreciate. For the first time 
 in history is the man of money compelled 
 to consider gold as no longer a standard 
 of excellency in the affairs of commercial 
 exchange. Gold is becoming cheap, not 
 on account of its plenitude, but of the 
 little power required to get it compared 
 with that of a hundred years ago when 
 its present price of $20.67 per ounce was 
 set by law. 
 
 The problem confronting the American 
 people and insistently demanding a so- 
 lution is to place their system of finance 
 on the machine power basis with indus- 
 try. It is yet performing on a man power 
 basis. It is obsolete. It is unethical. It 
 belongs with the sickle and the flail. It 
 is inadequate to meet the' demands of 
 the machine power of industry. Gold is 
 now an obstruction in American business. 
 It is of the system of barter. It is the 
 last hold of monarchy on the western 
 world. 
 
 Until the national monetary commis- 
 sion shall report to congress for the de- 
 monetization of gold, the American peo- 
 ple will continue to experience the rising 
 of prices on the market, the increasing 
 troubles in finance and the growing bur-
 
 The Further Rising of Price* 
 
 dens of living in the city. Only by know- 
 ing of the absolute standard of value, can 
 the American people successfully ride the 
 coming- financial storm and be masters of 
 their circumstances. 
 
 The great problem now before the Ameri- 
 can people is the rising price question. 
 How long will prices continue to rise is 
 becoming a serious question to men of 
 finance and industry, as well as to those 
 earning wages and salaries and living on 
 a fixed income. High prices are no bet- 
 ter or worse than low prices in the wel- 
 fare of man. Harm arises in the transi- 
 tion from one condition to the other. By 
 rising prices, salaries and wages become 
 inadequate for the standard of living. By 
 falling prices people are thrown out of 
 business and employment by "over-pro- 
 duction." Stability in prices is desired 
 to secure the welfare of all. 
 
 The price question involves every prob- 
 lem in the realm of finance and industry. 
 Its factors are many, and their varied 
 combinations make a perplexity truly 
 amazing in the modern world of business. 
 To conceive of the price question rightly 
 demands not so much of the power of 
 intellect as in the system of thought. The
 
 The Cheapening of Gold 
 
 great educational need of the day is the 
 right manner of thinking on the problems 
 of finance and industry. The universities 
 and schools are sadly deficient in their 
 instruction in this respect. To deduce a 
 correct system of thought in this line is 
 the scientific duty of the day. 
 
 The commanding and central factor of 
 the rising price question is the machine 
 power of industry. With a population of 
 87,000,000 the intelligence of our people 
 operates in terms of no less than 100,000,- 
 000 horse power in the production of 
 wealth. Counting eight persons as hav- 
 ing the working capacity of one horse 
 power, America has the same as 800,000,- 
 000 iron-workers performing its basic toil. 
 This machine power is increasing at a 
 prodigious rate. The problem of indus- 
 try now is not so much to harmonize men 
 in their contentions over "open" and 
 "closed" shops, and wages and hours as 
 to adjust these iron-workers in their craft 
 developments. From this movement of 
 craft development of machine power as 
 the root and trunk of modern business 
 activity proceed the branches, limbs, 
 twigs and leaves of every problem of the 
 price question. 
 
 The craft is a division of industry en- 
 gaged in the production of commodities
 
 10 The Further Rising of Prices 
 
 based upon a definite resource or service. 
 The iron craft includes all intelligence 
 and machine power having to do with 
 the making of iron ore into its infinite 
 variety of products. The miners, manu- 
 facturers and hardware dealers represent 
 the stages of production. The price of 
 any iron commodity therefore begins at 
 the mines and augments until sold by 
 the retail dealer to a consumer. Hence, 
 individuals of the iron craft are interested 
 in having good prices for their products 
 upon the market. 
 
 The same argument holds good in the 
 glass craft, the cotton craft, the oil craft, 
 the coal craft, the paper craft, the milk 
 craft, the meat craft, the fruit craft and 
 every other line of production organized 
 from a resource to its completed product? 
 to sustain a proper price upon the mar- 
 ket. It is obvious therefore, that each 
 craft when developed holds a monopoly 
 price against its consumers, which, of 
 course, are the other crafts. Those hav- 
 ing first developed have benefited there- 
 by at the expense of the remainder of 
 unorganized industry. They are doing so 
 now. They have high prices in terms of 
 the undeveloped crafts. From this con- 
 dition of things arises much complaint 
 over the price question. Especially, has
 
 The Depreciarion of Gilt Eldge Bonds 1 1 
 
 it been true of the unorganized in agri- 
 culture. This craft development is there- 
 fore, one of the basic factors in the price 
 question and obviously, one of great im- 
 portance and power. The proper distri- 
 bution of wealth is wholly dependent on 
 proper prices between the crafts. 
 
 It is easily seen that the capital and 
 labor of any craft are of necessity com- 
 pelled to guard each other's interests in 
 preference to those of the capital or the 
 labor of any other craft. That is, the 
 labor of a craft shall be more solicitous 
 in aiding its capital to sustain high prices 
 for their commodities on the market than 
 to lower them by aiding the labor of 
 any other craft to operate a strike. Like- 
 wise the capital shall have the same at- 
 titude toward its labor in preference to 
 the capital of any other craft. For only 
 by proper prices can profits be secured 
 for wage and income. Experience also 
 has shown that it is easier to divide an 
 ample profit with little contention than 
 a small profit with great force. Hence 
 in the craft development of capital and 
 labor are seen the units of individualism 
 of magnificent dimensions that are to 
 manifest in the United States in the 
 twentieth century. Craft rights are as 
 essential as state rights in the American
 
 12 The Further Rising of Prices 
 
 republic. Craft rights can be secured only 
 by equity in price powers upon the mar- 
 ket. 
 
 There is one craft at present enjoying 
 the special privileges of the federal gov- 
 ernment. Its product has set a price and, 
 how^ever plentiful it may become or how- 
 ever easily it may be got, its price re- 
 mains the same. This product is gold. 
 An ounce of it is priced to the market 
 for $20.67, whether it is worth that 
 amount or one-thousandth of it. Now, 
 there is an understanding between the 
 federal government and the other crafts 
 that 23.22 grains of this yellow metal 
 shall be called a dollar and be worth 
 100 cents. Now, it continues to cost less 
 by machine power to get these few grains 
 of gold, what must the other crafts charge 
 the gold craft for their products? Evi- 
 dently, to get a square deal, they must 
 raise their prices against the gold craft 
 proportionally as the cost of gold becomes 
 less. Hence, to perform this act of jus- 
 tice to themselves, they will continue to 
 raise their prices upon the market until gold 
 is demonetized. 
 
 From the craft development of the 
 machine power of industry and the 
 cheapening in the production of gold are 
 derived other reasons why prices will con-
 
 The Increasing Speculatton in Business 13 
 
 tinue to rise upon the market. They are 
 as follows : 
 
 1. The increasing deposits of surplus 
 wealth as capital for investment. 
 
 2. The increasing plenitude of easy 
 credit for speculative operation. 
 
 3. The increasing plenitude of gold 
 for currency purposes. 
 
 4. The decreasing necessity of gold 
 for redemption purposes. 
 
 5. The decreasing purchasing power 
 of the gold dollar. 
 
 6. The increasing power of the busi- 
 ness world to make its own money. 
 
 7. The increasing power of the busi- 
 ness world to prevent panics and to con- 
 trol depressions. 
 
 8. The increasing demands of the 
 American people to satisfy a rising stand- 
 ard of living. 
 
 All of these causes acting together and 
 intensified by the prodigious increase of 
 machine power will soon make it abso- 
 lutely necessary to demonetize gold to 
 prevent the demoralization of business 
 by the raising of prices upon the market. 
 Until gold is demonetized, prices will 
 continue to rise and the worth of all 
 forms of deferred payments will continue 
 to fall on account of rising interest rates. 
 
 The question paramount before the
 
 14 The Further Risinig of Prices 
 
 American people today, therefore, is not 
 tariff revision, nor traffic rates, nor val- 
 uation, nor capitalization, nor watered 
 stock, nor income tax, nor trusts, nor 
 government ownership. The question 
 paramount today is rising prices caused 
 by the depreciating standard of value. 
 This question leads all other questions 
 necessary for the progress and welfare 
 of the American people. It is introduc- 
 tory to every other problem in their en- 
 tire system of business. When it is 
 rightly understood, all other questions in 
 finance and industry will be easily for- 
 mulated for solution. Who can not prop- 
 erly discuss this problem of rising prices 
 and its solution can present little of lead- 
 ing and vital importance for our future 
 welfare and happiness. 
 
 Prices today are relatively high. They 
 will be higher tomorrow and next year 
 and for several years to come. They 
 will continue to rise on account of the 
 increasing use of machine power for the 
 production of wealth which causes a de- 
 preciating standard of value which causes 
 an increasing amount of credit to be placed 
 on the market which catises an increasing 
 demand for reserves for currency purposes, 
 which causes an increasing demand for gold 
 and high grade securities, which causes an
 
 The Increasing Extravagance in Living '5 
 
 increasing amount of investment for the 
 production of gold and more high grade se- 
 curities, which causes an increasing pleni- 
 tude and cheapening in production of both, 
 ivhich causes the decreasing purchasing 
 power of the dollar, which causes the in- 
 creasing rise of prices on the market, which 
 causes an intensified increase in credit and 
 deposits, which causes an intensified rela- 
 tive scarcity of currency, zvhich causes 
 an intensified supply of financial paper 
 for purposes of domestic exchange, which 
 causes an mtensified inducement for spec- 
 ulation, which causes an intensified de- 
 mand for commodities, zvhich causes an 
 intensified necessity for price control on 
 the market, zvhich causes an intensified 
 condition for monopolies, zvhich causes 
 the trusts of capital and labor to inten- 
 sify in their craft development to bal- 
 ance the monopoly prices of exchanging- 
 crafts, which causes an intensified de- 
 mand for intelligence in business, zvhich 
 causes an intensified demand for increase 
 in salaries and wages, zvhich causes an 
 intensified standard of living, zvhich 
 causes an intensified immigration, which 
 causes an intensified increase in popula- 
 tion, zvhich causes an intensified demand 
 for goods and services, which causes an 
 intensified demand for currency, which
 
 16 The Further Rising of Prices 
 
 causes an increased intensified demand for 
 gold, which causes an increased intensified 
 demand for machine power for the produc- 
 tion of wealth to satisfy the increasing 
 wants of man. All of which will continue 
 to intensify in their various movements un- 
 til gold is demonetized and the system of 
 finance shall be based upon the absolute 
 standard of value. 
 
 It is obvious that only those of busi- 
 ness who can think in terms of energy 
 will lead in the scientific discussion of 
 the financial question. It is plain why 
 the financial situation and requirements 
 are not understood today by the classical 
 economists. Their paradoxes are per- 
 plexing and unaccountable. Gold was 
 never more plentiful than today, yet it is 
 scarce in the market. And though its 
 scarcity is plainly perceived it is becom- 
 ing cheap. In former times a plenitude 
 of gold never could mean a scarcity of 
 gold, nor has a scarcity of gold ever ac- 
 companied a rise in prices on the market. 
 These paradoxes become easily under- 
 stood only when apprised that the finance 
 of the world is now expressing in terms 
 of machine power. Hence, the exchanges 
 of the services of the world will soon 
 cease to be performed in terms of gold. 
 Since the American people excel in the
 
 The Tariff as a Statute Price 1 7 
 
 manipulation of energy, they will lead 
 the world in the solution of the financial 
 problem. The etiforts of their second cen- 
 tury will be but extensions cf the works 
 of their first. 
 
 iPinanctal 
 
 What the pendulum is to a clock the 
 unit of account is to the mechanism of 
 commercialism. As the one is a dimen- 
 sion of motion, the other is a dimension 
 of service. Changing the dimension of 
 the former alters the record of time ; of 
 the latter, alters the prices of commodi- 
 ties on the market. Decreasing the di- 
 mension of the pendulum raises the rec- 
 ord of time ; of the unit of account, raises 
 prices on the market. It matters not as 
 to the substances of which these units are 
 made, if their dimensions remain con- 
 stant their measurements remain invari- 
 able. The scientific problem now con- 
 fronting the world of finance is to estab- 
 lish an invariable dimension for the unit 
 of accoimt. This is a problem of science 
 second to none since the days of Coper- 
 nicus. 
 
 The dimension of the unit of account 
 is the unit of service used in producing 
 commodities for the market. It is the 
 unit of cost. It is the amount of energy
 
 18 The Further Rising of Prices 
 
 dissipated to perform a definite amount 
 of work in the processes of business. It 
 is, therefore, the unit of value. Since 
 marketable wealth is but the resources 
 of nature modified by work into such 
 forms as can satisfy the wants of man, 
 it is obvious that no wealth whatever can 
 be secured from nature without a certain 
 amount of energy being dissipated. The 
 more energy there is dissipated to get 
 an object the greater is its cost. The 
 unit of energy used to measure the cost 
 is the dimension of the unit of account. 
 If the energy dissipated to perform the 
 work of cost is used by an animal ma- 
 chine, it is rated in terms of time. This 
 results into a variable dimension, how- 
 ever. It is used to rate the unit of ac- 
 count in the world of finance today. 
 
 The basic cause of the rise of prices 
 for the last decade on the markets of the 
 world is the decreasing dimensions of the 
 units of account. By international agree- 
 m;ent, a unit of gold has been selected as 
 the universal instrument of financial ex- 
 change. An ounce of gold is worth 
 $20.67 in terms of the unit of account of 
 American finance. That is, the amount 
 of energy of animal power as dimension 
 of the unit of account, must be multi- 
 plied by 20.67 to obtain the cost of an
 
 The Increasing of Capitalization 1 9 
 
 ounce of gold. This is the dimension 
 legalized in 1834 when an ounce of sil- 
 ver was supposed to cost $1.29 in terms 
 of the same unit of account. 
 
 Since that date man has discovered an 
 infinitude of gold for currency purposes 
 and he is obtaining it at a rapidly de- 
 creasing rate of cost. It is being pro- 
 cured by machine power. It is being pro- 
 duced by the forces of nature operating 
 through metal machines all but automat- 
 ically. Hence the cost of gold is being 
 reduced and that to such an extent as 
 to derange the mechanism of the entire 
 world of finance and industry. What to 
 place in its stead as a representative of 
 the unit of account is now the disturbing 
 question of business. The high and ris- 
 ing prices of commodities and falling se- 
 curities will force a world discussion of 
 the money question. The issue is now 
 
 on. 
 
 Never before this century has it been 
 possible to perform a scientific discus- 
 sion of the money question. That is, 
 man has never before been permitted to 
 interpret it in terms of energy. For no 
 subject whatever having to do with the 
 progress of man can be interpreted scien- 
 tifically without the philosophy of ener- 
 gy. Value is of power. Power is of
 
 20 The Further Rising of Prices 
 
 energy. Things having energy have 
 value. Corn and wheat are of energy. 
 Gold is of color, weight and sound. Gold, 
 therefore, is not of value. 
 
 Previously, the money question has 
 been considered wholly in terms of gold 
 or silver or some material. A dollar to- 
 day is all but universally conceived as a 
 material object in minted or printed form 
 rather than as a unit of service which 
 the form represents. Any form of cur- 
 rency or money is but a token for a defi- 
 nite amount of service rated in terms of 
 the unit of account. The minted or 
 printed unit of legal tender is no more 
 a dollar than a portrait is a person. The 
 unit of account as the unit of service, as 
 the unit of value, as the unit of energy 
 uncarnatc dissipated to produce market- 
 able zvealth is the basic and central fact of 
 justice in scientific finance and industry. 
 
 Since all wealth is but the result of 
 work having been performed on the re- 
 sources of nature, pieces of metals have 
 been used as counters for the service 
 performed. A gold ounce in 1834 rep- 
 resented 15.98 times as much service as 
 a silver ounce. The machine power of 
 industry deranged this ratio of service 
 so badly that silver has been discarded 
 as a criterion for rating service in the
 
 The Increasing of Interest Rates 
 
 production and distribution of wealth. 
 Gold is now showing the same poor qual- 
 ity for rating services in the processes of 
 business. It is becoming cheap. The 
 dimension of the unit of account for which 
 it is the legal token is growing smaller 
 day by day. The gold unit is losing its 
 purchasing power. Since service makes 
 worth, other things by comparison are 
 increasing in their worths. And since 
 the price is worth rated in terms of the 
 unit of account, prices will continue to 
 rise and securities to fall until 23.22 grains 
 of gold shall cease to represent the dollar. 
 That is, until gold is demonetized and the 
 unit of account is based upon an invari- 
 able unit of service. Every kilowatt hour 
 of energy sold as a commodity on the 
 market promotes the demonetization of 
 gold and the establishment of the abso- 
 lute standard of value. 
 
 Prudent Americans of finance there- 
 fore, w'ill dispose of their holdings of 
 gold as soon as possible. Soon the re- 
 serves of financial institutions will be 
 based on the potent securities of living 
 industry rather than on the inert piles of 
 the yellow metal. Other nations of the 
 earth not being so far developed in their 
 economies of government, yet consider 
 gold as a foundation of all finance and
 
 22 The Further Rising of Price* 
 
 industry. They are struggling with the 
 social problems of government, those of 
 church, state and school. They have yet 
 to establish the principle of liberty. They 
 have yet to emerge from the chrysalis of 
 monarchy and to assume the imago of 
 Democracy. America has the blessed 
 privilege of being first to interpret the 
 requirements of nature in human gov- 
 ernment. For 134 years have the Ameri- 
 can people held fast to the grand idea 
 through vicissitudes not experienced by 
 any other nation of history. Their prob- 
 lem of this day, it is a world problem, 
 is to interpret this ideal in its economic 
 requirements. Its imperative requires 
 the riddance of gold as a basic relation 
 from the system of finance and the es- 
 tablishment of an American system of 
 economics that shall be interpreted in 
 terms of energy. 
 
 31nDu0trial 
 
 The basic problems of American prog- 
 ress as emanating from the constitution 
 are social, political, federal and economic. 
 The social and political problems now 
 have practical solutions. They were com- 
 pleted at the close of the civil war when 
 the principle of power and control of 
 federal government was forever estab-
 
 The Increasing Evil of Anti-Trust Laws 23 
 
 lished as being superior and paramount 
 to the power and control of any of its 
 parts. The economic problems in the 
 meantime were developing into forms 
 never before seen in the history of gov- 
 ernment. They are now at that stage of 
 progress to require adequate laws for 
 federal co-ordination and control. 
 
 The logic of all control as incorporated 
 in the constitution was made in terms of 
 political and social relations. They be- 
 long to the psychology of energy incar- 
 nate, i. e., of man power. The affairs 
 of business are today wrongly interpreted 
 in these terms. They are wrongly con- 
 sidered therefore as subjects of political 
 operations and adjustments. Since the 
 corporate relations of business have 
 neither social nor moral interpretation 
 whatever, confusion must necessarily 
 abound in the attempt to adjust their 
 relations by the political roles of gov- 
 ernment. The logic of economics in the 
 American government must be under- 
 stood before the problems of business can 
 find their proper solutions. They be- 
 long to the psychology of energy- uncar- 
 nate, i. e., of machine power. 
 
 After the establishment of the consti- 
 tution the affairs of trade began to as- 
 sume larger and more effective forms of
 
 24 The Further Rising of Prices 
 
 expression. The coming of the steam 
 engine for power and locomotion and the 
 telegraph for the transmission of intelli- 
 gence made conditions and opportunities 
 for successful trade beyond the power of 
 the personal individual to assume. In 
 consequence the logic for relating the 
 affairs of business in the American gov- 
 ernment was forever changed. The states 
 of the union permitted corporate entities 
 operating machine power to be created 
 and clothed with all the rights and limi- 
 tations of personal individuals in the af- 
 fairs of interstate trade. 
 
 The dimensions and activities of these 
 creations of estate ultimately became an 
 index to the progress and prosperity of 
 the American people. They not only 
 grew to the limits of the states in which 
 they were created to operate, but ex- 
 tended their business into other states 
 and throughout the nation. There arose 
 in consequence the problems of interstate 
 commercial corporate responsibilities. 
 These corporate entities by their superior 
 organization, equipment and directive 
 abilities and with their more favorable 
 prices, equality of goods and better serv- 
 ices, began to displace the trade of the 
 lesser factors of business in the general 
 market.
 
 The Higher Wages and Shorter Hours 25 
 
 This successful development of cor- 
 porate business made widespread antag- 
 onism and resentment among the people 
 and which became expressed in statutory 
 form as anti-trust laws. There has arisen 
 in consequence a confusion in business 
 and politics and federal affairs such that 
 the American people are again confronted 
 with the gigantic problem of eliminating 
 the evils of arbitrary laws in interstate 
 trade by powers of federal control. The 
 distinction of confusion today with that 
 of 1787 is in having not only business 
 problems of larger dimensions but of dif- 
 ferent nature. They are problems of en- 
 ergy uncarnate expressing as commercial 
 corporations. 
 
 It is plain that the federal government 
 now lacks adequate powers for effective 
 control of these corporate forms. The 
 political states have created business 
 problems beyond their powers to super- 
 vise. Not only does the welfare of the 
 political states now require a rightful so- 
 lution of this commercial corporate prob- 
 lem as well as that of the federal gov- 
 ernment, but the corporations themselves 
 are becoming insistent for an organic re- 
 lation in government. It is now an ab- 
 solute necessity for further progress of 
 finance and industry.
 
 26 The Further Rising of Price* 
 
 As it is now, the corporations have 
 neither state nor federal protection nor 
 are they permitted to officiate to protect 
 themselves. Commercial corporate rights 
 are now as essential for the stability and 
 perpetuity of the American form of gov- 
 ernment as political corporate rights. The 
 enactment of a federal craft law will be 
 their natural adjustment in government 
 to establish and sustain them. 
 
 The crafts of American business are 
 distinguished by the specific commodities 
 and services which they deal on the mar- 
 ket. They are becoming organically re- 
 lated to one another in a system of busi- 
 ness characteristic of the American sys- 
 tem of economics. Their ultimate de- 
 velopment will be monopolies of capital 
 and labor iiaving complete control of 
 their respective resources, commodities 
 and prices on the market. To solve the 
 problem of relating these crafts into a 
 system where there shall be justice of 
 prices between them is the goal of the 
 federal craft law. It will solve the prob- 
 lem of distributing wealth among the 
 people. It will be the federal congress 
 of commercial states. 
 
 It is obvious that progress will com- 
 pel all interstate transportation corpora- 
 tions to form into an ultimate entity or
 
 The Increasing Immigration 27 
 
 craft or commercial state inclusive of all 
 railway interests, likewise the iron inter- 
 ests, coal, oil, glass, wheat, corn, cotton, 
 gold, etc., respectively. These ultimate 
 commercial states are now at hand and 
 are seeking a method to relate themselves 
 into a definite economic program or com- 
 mercial congress as organic factors in 
 the federal government. Such a result 
 can be obtained only by replacing the 
 anti-trust laws by a federal craft law 
 that shall incorporate these twenty or 
 more commercial states. Their union 
 will be the American economic program, 
 the substructure of the American repub- 
 lic. It will complete the American sys- 
 tem of psychology as expressed in the 
 preamble to the constitution. 
 
 By means of this federal congress, the 
 commercial states will have as natural 
 relation in federal government as the po- 
 litical states. Then politics will separate 
 from business, vocation from state and 
 the business man will stand forth in his 
 rights second to none in the federal plan. 
 Then the political state will perform as 
 umpire in government and not as actor 
 therein. The American people thereby 
 will complete the work as instituted by 
 the fathers in the immortal declaration in 
 the year one of Americanism.
 
 28 The Further Rising of Prices 
 
 XI^\)t American llBusinegs; program 
 
 The insistent problems now confront- 
 ing the American business program in its 
 necessary order of development are : 
 
 1. The demonetization of gold and the 
 establishment of a unit of energy as the 
 absolute standard of value. 
 
 2. The development of corporations 
 of capital and labor into their respective 
 crafts or commercial states to control the 
 prices of their commodities on the mar- 
 ket. 
 
 3. The repeal of all anti-trust laws 
 and the enactment of a federal craft law 
 to incorporate these commercial states 
 under federal control. 
 
 4. The establishment of a federal con- 
 gress of these commercial states to jus- 
 tify their prices in the processes of mu- 
 tual exchange. 
 
 5. The establishment of a money sys- 
 tem separate and distinct from the na- 
 tional system of currency and which shall 
 be based on the absolute standard of 
 value. 
 
 6. The establishment of a national sys- 
 tem of clearing houses rather than that 
 of a national or central bank. 
 
 7. The establishment of a federal law 
 that all economic interpretation shall be 
 made in terms of energy.
 
 The Increasing Strife in Cities 29 
 
 tE^tje ^orlD ifinancial ^totm 
 
 The commercial crisis of 1907 has yet 
 to be explained by the political econo- 
 mists. The troubles of '37-'57-73-'93 fur- 
 nish no explanation for it. The former 
 crises were caused by the inadequacy of 
 a currency system to satisfy the opera- 
 tions of a fast growing system of credit. 
 That of 1907 was caused by a depreci- 
 ating standard of value and which is the 
 first instance to be recorded in the his- 
 tory of finance. The diagnosis of the 
 cause of this crisis is as follows : 
 
 1. The depreciation of the standard 
 of value on account of wealth being 
 cheaply produced by machine power. 
 
 2. The raising of prices of commodi- 
 ties and services on account of the de- 
 creasing purchasing power of the gold 
 dollar. 
 
 3. The depreciation of railway bonds 
 on account of rising prices of commodities 
 and services and hostile politics and re- 
 strictive legislation against railway rates. 
 
 4. The decreasing power of the rail- 
 roads to borrow on long time bonds. 
 
 5. The increasing rate of interest on 
 short time bonds. 
 
 6. The decreasing power of the rail- 
 roads to purchase supplies for construc- 
 tion and operation.
 
 30 The Further Fusing of Prices 
 
 7. The decreasing market for all com- 
 modities of manufacture entering into rail- 
 way supplies. 
 
 8. The closing down of industries and 
 the unemployment of labor engaged in 
 transportation and producing these sup- 
 plies. 
 
 9. The loss of confidence in credit by 
 slow collections and settlements. 
 
 10. The refusal of banks to exchange 
 only in terms of currency. 
 
 11. The loss of confidence by deposi- 
 tors and the withdrawal of currency. 
 
 12. The inadequacy of $3,000,000,000 
 of currency to satisfy $13,000,000,000 of 
 deposits and the refusal of banks to pay 
 out currency on deposits. 
 
 Hence the panic and afterwards the de- 
 pression. 
 
 The panic has ceased. The depression 
 will disappear as the railways resume 
 their purchases of supplies on the market. 
 
 Frequent and growing crises must now 
 be expected until gold is demonetized and 
 the system of finance shall be based on 
 an absolute standard of value. This will 
 happen at no late day. Such will result 
 from the coming financial storm.
 
 The Demand for Surety in Business 
 
 31 
 
 Eocating t^e Coming ^tocm 
 
 The welfare of the rural people is pro- 
 portional to the prices of commodities. 
 The welfare of the urban people is propor- 
 tional to the wages divided by the prices 
 of commodities. It is plain by the chart 
 that the rural welfare was increasing from 
 
 ^ I n 
 
 t&50 1 Ta6o 
 
 Y°l Y 
 
 ] — ^~l — r 
 
 7670 ( »'S0 7690 \ '900 \ I^IO 
 
 Ml 
 
 Chart showing progress of the American people from 
 1850 to 1910 
 
 1850-1870 and decreasing from 1870 to 
 1898. Since 1898 it has been increasing at 
 a rapid rate. The urban welfare rose rap- 
 idly from 1870 to 1898. Since 1898 it has 
 been downward as is indicated by the 
 heavy dark line.
 
 32 The Further Rising of Prices 
 
 The coming financial storm, therefore, 
 will have its greatest effects in the large 
 cities. The cost of living will continue to 
 increase faster than the rise of income un- 
 til gold is demonetised and the system of 
 finance shall be based on the absolute 
 standard of value. The heavy dark line 
 will continue downward until the financial 
 storm shall cease. 
 
 The National Monetary Commission is 
 confronted with a task second only in im- 
 portance to the world to the formulation 
 of the immortal documents. As the Dec- 
 laration formulates social liberty and the 
 Constitution political liberty, the mone- 
 tary document will formulate economic 
 liberty, the first instance to be recorded 
 in history. 
 
 The central proposition of the mone- 
 tary document is the establishment of the 
 absolute standard of value. Its system 
 of thought for making the interpretation 
 is the philosophy of energy. Any other 
 method of procedure for the American 
 people spells failure, the most miserable. 
 
 i Ik 
 
 1 DD A DV
 
 Currency is the instrument of exchange 
 whose redemptive power is national tax. 
 
 THE ABSOLUTE STANDARD AND UNIT OF 
 VALUE IS THE CENTRAL PROPOSITION OF ALL 
 PROGRESS IN THE 20TH CENTURY. IT IS THE 
 KEY TO EVERY PROBLEM IN THE PHILOSOPHY 
 OF LIFE 
 
 Money is the instrument of exchange 
 whose redemptive power is marketable 
 wealth.
 
 Tliis book is DUE on the last 
 date stamped below 
 
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 abs( 
 
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 vak 
 
 unit 
 
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 3»»-2,'45(3232) 
 Address all communications concerning this treatise to 
 
 Ci^e Oniteristtt of ti^e Worn 
 
 Instituted! to Elstablish the Philosophy of Americanism 
 
 C. A. BOWSHER. EDITOR 
 
 Caxton Building. Cleveland, Ohio 
 
 The Calvert-Hatch Co.. Printprs
 
 AA 000 603 200 7 
 
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