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 THE LIBRARY 
 
 OF 
 
 THE UNIVERSITY 
 
 OF CALIFORNIA 
 
 LOS ANGELES
 
 Th^ 
 
 RLP'5 
 
 ILV^R l^U^STION 
 
 5ACOI3 PIATT PUNN 
 
 Frank H. Smith, 
 f rinter and Binder, 22 N. Pennsylvania St., Indianapolis 
 
 1894.
 
 COPYRIGHT, 1894, 
 
 BY 
 
 JACOB PIATT DUNN.
 
 r^6 
 
 The VioAh'^ SiUe;f ^h^^fion. 
 
 I. 
 
 The Coinage Clock. 
 
 I take it that the adjustment of the coinage of a 
 country is much like the regulation of a clock. A 
 clock is regulated in order that it may run properly, 
 and keep time, without any further tinkering than 
 winding it up at intervals. A properly adjusted coin- 
 age will perform its functions without any tinkering 
 other than the occasional addition to its volume to 
 replace lost coins, or to meet the increasing demands of 
 commerce. Ordinarily when a clock is out of order we 
 send it to a clockmaker, but sometimes there is no 
 clockmaker at hand, and such a concurrence of events 
 brought about the great controversy over the village 
 clock of Schnitzendorf, which is recorded in the Travels 
 of Erasmus Wilberforce.* 
 
 This clock had been in use in the village for more 
 than a century, and therefore was regarded with great 
 affection and veneration by the villagers, but for some 
 reason it began to lose time, and grew worse from day to 
 day until it lost an hour in every twenty-four. A com- 
 mittee from the village council made an investigation, and 
 reported that in their opinion the trouble was due to a 
 wheel that had become worn. The village minister, 
 who was about journeying to I^uremburg to attend the 
 
 Note.— Vol. i, p. 196; Vol. a, p. 83.
 
 synod, was therefore authorized to purchase another 
 wheel, but on his return announced that he could find 
 no wheel like the one to be replaced. There were wheels 
 of the same size, but they did not have the same number 
 of cogs. There were wheels having as many cogs, but 
 they were not of the same size. This report caused 
 general consternation, and the villageUouncil was con- 
 sidering what to do next when Mr. Wilberforce first 
 visited the place. I cannot reproduce in full the valu- 
 able debate on the subject, but will give a summary of 
 its more important features, and persons of an inquir- 
 ing turn of mind can consult his work if they desire 
 details. 
 
 One gentleman was in favor of getting a wheel of 
 the proper size, without regard to the cogs. He argued 
 forcibly that the clock would not run properly if the 
 wheel were either too large or too small. The village 
 could not afitbrd to be controlled by the fancies of 
 ISTuremburg clockmakers in regard to cogs, for if it did, 
 Schnitzenburg would have to alter the clock every time 
 the clockmakers introduced a new style of wheels. He 
 believed in local self-government, and would never vote 
 to submit to outside dictation. 
 
 Another member agreed fully in the spirit of the 
 remarks of the first speaker, but insisted on purchasing 
 a wheel with the proper number of cogs. He showed, 
 by extracts from a work on clocks, that a clock cannot 
 keep time unless the wheels have the right number of 
 cogs, but that no two wheels were of the same size. 
 
 A third member regretted the tendency toward 
 radicalism that had been displayed in the matter. This 
 clock had been used by all the fathers of the village. 
 His own grandfather had for years been entrusted to
 
 wind it. It had come down to them hallowed by a 
 thousand sacred memories. It should not be marred by 
 sacrilegious hands. As for him, he stood by the teach- 
 ings of the fathers, and was opposed to any change 
 whatever. 
 
 The speaker who followed also opposed any change, 
 although he admitted that the clock was found to be 
 half an hour slow every morning, after being set right 
 the night before. He said that those who demanded 
 the change were greedy capitalists who wanted laboring 
 men to go to work half an hour earlier. 
 
 Another member, also devoted to the interests of 
 labor, indignantly denied this assertion. He demon- 
 strated that although workingmen went to work half an 
 hour later, they were obliged to continue work half an 
 hour longer than before on account of the clock's loss 
 during the day. After a brief consultation with the 
 preceding speaker, however, he announced that they 
 would both vote to leave the clock as it was, provided 
 it be set each day at 5 p. m. 
 
 The next speaker protested against any expendi- 
 ture on account of the clock. In the entire history of 
 the village there had been no such expenditure, and an 
 over-taxed people would not submit to it now. It was 
 agreed that the clock lost an hour each day, and all 
 that was necessary was to direct the clerk to prepare a 
 schedule showing just how slow it was at each hour of 
 the day. The people could then easily calculate the 
 correct time without any expense. 
 
 The economic policy was opposed by another mem- 
 ber who maintained that an enlightened people never 
 objected to necessary or beneficial expenditures. The 
 people of his district believed that the clock needed a
 
 new key, and he had pledged himself to vote for one. 
 He regretted to see that some members who had advo- 
 cated a new key before the people were now opposed 
 to it, but he proposed to be consistent, and to carry out 
 his campaign pledges. 
 
 Finally Von Schermerhorn arose. He had the 
 reputation of being a safe and conservative leader, and 
 was supposed to be especially versed in time because 
 he had long been the leader of the village choir. He 
 said he was sorry to see such diversity of opinion on 
 this important question, but must admit that there was 
 great weight in all the arguments advanced. For him- 
 self, he was opposed to going to extremes. He had 
 learned from the janitor, who had been making some 
 experiments on the clock, that if one of the weights 
 were removed the clock lost only half an hour each day, 
 and this was conformable to reason because the com- 
 mittee had reported that the source of the trouble was 
 the wearing of a wheel, and this wearing must have 
 been caused by the pulling of the weights. He was 
 willing to go to the extent of reducing the loss of time 
 one half, and if the result was satisfactory to the people 
 more weights could be taken off later on. He there- 
 fore moved that one of the weights be removed ; that 
 the clock be set at 5 p. m. each day ; that the clerk pre- 
 pare a schedule showing the hourly loss of time ; and 
 that the removed weight be placed in the village 
 museum, with appropriate ceremonies, as a valuable 
 relic of the forefathers. This judicious compromise met 
 the general favor of the house, and was adopted with- 
 out division. 
 
 Three years later Mr. Wilberforce was again in 
 Schnitzendorf, and found that the controversy concern-
 
 in^ the clock was far more violent than before. Indeed, 
 it had become the one great subject of discussion. In- 
 stead of losing only half an hour a day, as predicted by 
 Von Schermerhorn and the janitor, the clock had come 
 to lose six hours. And this result might reasonably 
 have been anticipated if the council had carefully con- 
 sidered the proposal to remove the weight, for neces- 
 sarily the reduction of the weight must make the clock 
 run slower. But error entrenched in law can be de- 
 feated only by long seige, and Von Schermerhorn and 
 his party stoutly insisted that the burden of proof was 
 on anyone who proposed a change to show that his pro- 
 posal would remedy all difficulties, and as, in the absence 
 of a clockmaker, the question had to be discussed from 
 theoretical standpoints, a majority could never be 
 obtained for any one change. The party favoring a 
 wheel of the proper size had grown quite strong, and 
 yet many of them were ready to accept a wheel with 
 the proper number of cogs, without regard to size, as a 
 compromise measure. The essential thing to them was 
 to have a wheel. Another strong faction held that the 
 clock was of no real importance, as the clerk's schedule 
 was the real source of information as to time, and they 
 favored abandoning the clock altogether, and issuing 
 time schedules for the use of the people. There was 
 also a large party that favored taking oft" more weights 
 until the clock should lose twelve hours a day. This, 
 they easily showed, would make a day of twelve hours, 
 which would be a vast improvement because everybody 
 could do twice as much in an hour as formerly. It 
 would of course be a tax on employes who were under 
 a contract to work ten hours a day, but workingmen 
 had a tendency toward anarchism, and were unreason-
 
 8 
 
 able in their opposition to an honest hour. This plan 
 was advocated by all employers, who opposed with vir- 
 tuous indignation the dishonest day of twenty-four hours, 
 and so the system of removing weights had strong sup- 
 port, although it was producing an effect quite opposite 
 to what had originally been claimed for it. 
 
 At length Von Schermerhorn brought forward a 
 new plan for a compromise. He proposed that the 
 clerk should be directed to inscribe on a piece of paper, 
 " This is ten pounds, by order of the Council of Schnit- 
 zendorf," which declaration should be signed by the 
 Mayor and countersigned by the clerk, and the paper 
 should then be suspended in the place of the weight 
 which had been removed. He said he had become satis- 
 fied that they had gone too far in removing the weight, 
 but that it could not be restored because the janitor had 
 unfortunately sold it for old iron. He was willing how- 
 ever to give the weight theory a fair trial, and thought 
 that the council should yield to the general demand 
 that something be done. After some discussion an 
 amendment was adopted making the inscription read 
 "twenty pounds" instead often, and the ordinance 
 was passed, amid loud applause from the galleries. 
 
 During the few days that Mr. Wilberforce remained 
 in the village the clock continued to lose time as before, 
 but there was a general faith that it would do better 
 when it became accustomed to the paper. The reader 
 will doubtless agree with the learned traveler in regret 
 that no information as to the final outcome of the clock 
 question has been received. Those who are interested 
 in such matters should procure his works and read his 
 very thoughtful remarks on the difficulty of regulating 
 clocks on a compromise basis.
 
 II. 
 
 Why The Coinage Clock Went Wrong. 
 
 ^ 
 
 From time immemorial governments have fixed 
 their own forms of money, giving to coins such weight, 
 fineness, and relative value as they saw fit, and this was 
 necessary because every nation needed a fixed form of 
 money for its domestic uses, which are always greater 
 than the international uses, and no nation could expect 
 to have its coinage furnished by other nations. But 
 this necessity gave rise to disadvantages. Money is the 
 medium of international commerce aswd^ll as of domes- 
 tic commerce,/and when the merchant or the traveler 
 passed beyWd the bounds of his own country he was 
 obliged to use forms of money difiering in size, name, 
 quality and value from those of his home. In olden 
 times this was not so serious a trouble, because com- 
 merce was limited, but it grew as civilization grew, and 
 during the present century it has increased enormously, 
 for this has been peculiarly a century of development 
 of international commerce. The application of steam 
 power to transportation on both land and sea has given 
 opportunity for the exchange of surplus products that 
 did not exist before, and the telegraph has practically 
 annihilated distance, so far as communication is con- 
 cerned. New York can communicate with New Zea- 
 land, or Japan, or India, or the Cape of Good Hope, or 
 Rio Janeiro, more quickly now than it could with 
 Washington in 1820. With fourteen cables crossing 
 the Atlantic, with cables circling Africa, Asia and South 
 America, and extending to Australia and the more
 
 10 
 
 important islands, with wires ramifying every civilized 
 country, and crossing some uncivilized ones, the world 
 is in closer communication now than the towns of 
 Rhode Island were at the beginning of the century. 
 
 As for international commerce, its spread, even in 
 old and mercantile countries, is almost beyond belief. 
 In 1800 the total annual international commerce of the 
 world was estimated at $1,510,000,000. In 1889 the 
 foreign commerce of the United States alone was 
 $1,600,000,000, while the international commerce of the 
 world was estimated at $16,885,000,000. The decade of 
 the most rapid increase of international commerce was 
 1850 to 1860, when steam was being most rapidly 
 applied to transportation, and the period from 1840 to 
 the present is marked throughout by this development. 
 In 1840 the world's international commerce had reached 
 only $2,865,000,000, a gain of but ninety per cent, over 
 1800. In 1840 there were but 4,515 miles of railroad in 
 the world — less than now in the State of Indiana — but 
 in 1880 there were 228,440 miles. In 1840 the total 
 horse power of the steamships of the world was 330,000; 
 in 1880 it was 5,240,000. In 1840 the carrying power 
 of all the shipping in the world was 10,482,000 tons; in 
 1882 it was 37,900,000 tons.* With this increase of \ 
 commerce and cheapening of transportation, the annoy- ) 
 ances and disadvantages of differing currencies were 
 multiplied over and over. 
 
 The most important source of this trouble was the . 
 
 difference of standards of value, and this, too, although \ 
 
 nearly all countries used the same materials, gold and 
 
 silver, for their standards. The difference in size of 
 
 coins, and the amount of alloy they contained, could 
 / 
 
 \ 
 
 Note. — These figures are Mulhall's.
 
 11 
 
 be overcome with comparative ease, because they could 
 be measured by the amount of pure gold or silver they 
 contained, but for various reasons diflerent countries 
 fixed diflerent relations between gold and silver, so that 
 the same quantity of one metal was worth more in one 
 country than in another. This should be clearly under- 
 stood and firmly borne in mind, because it was the 
 greatest evil of the coinage systems of the world, and 
 the one that was most aggravated by the closer con- 
 nection of the nations in commerce. One country 
 decreed that an ounce of gold should equal 15 ounces 
 of silver, another that it should equal 15| ounces, and 
 another that it should equal 16 ounces, while in some of 
 the countries that we call uncivilized an ounce of gold 
 was valued at only 10 or 12 ounces of silver, j^ow in 
 each country the decree of that country was binding to 
 a certain extent, because in the payment of debts the 
 creditor was obliged to take any kind of lawful money 
 that was tendered to him, but beyond the borders of 
 the country its authority ceased, and gave place to 
 another authority. Therefore the merchant or the 
 banker would send gold to the country where the most 
 silver could be obtained for it, and send silver to the 
 country where the most gold could be obtained for it, 
 and so the coins of the various nations were drawn 
 about over the world as profit could be made from their 
 removal. 
 
 This fact has been observed for many years, and it 
 has caused an immense amount of trouble to various 
 countries at various times. The principle is commonly 
 called " Gresham's law," and it is usually stated in the 
 form, " Bad money drives out good money." This 
 expression is accurate enough in some cases, as, for
 
 12 
 
 example clipped coin, if tolerated, will drive out un- 
 dipped coin, or paper money that is not maintained on 
 a specie basis will drive out specie. But it leads to 
 confusion if used in regard to the movement of coin 
 metals. For example, if England's coinage ratio of 
 gold to silver were 1 to 15, and the ratio of France 
 were 1 to 16, and both had free coinage of both metals, 
 the merchants and bankers would take an ounce of gold 
 from England and exchange it for 1(5 ounces of silver 
 in France, and, returning to England, would buy another 
 ounce of gold with 15 ounces of their silver, but it 
 would be absurd to say that silver was bad money in 
 England and good money in France, or that gold was 
 good money in England and bad money in France. 
 Nevertheless gold would be taken out of England, and 
 silver would be taken out of France. The more proper 
 statement would be that gold and silver move to the 
 country which gives them the greatest money value. 
 And this form of statement is the more desirable because 
 it makes easier an understanding of the expression 
 " market value " as applied to gold and silver, for from 
 this traflac in these metals it resulted that their com- 
 mercial value was higher than the coinage value placed 
 on them by the countries least favorable to them, and 
 lower than the coinage value placed on them by the 
 countries most favorable to them, for the cost and 
 danger of transportation had always to be considered 
 as well as the matter of profit to the owner. Within 
 these limits the market value was affected to some 
 extent by speculation, by supply and demand, by new 
 discoveries, etc., but the chief influence was the force 
 of the combined legislation of the world, for legislation 
 fixed the ratios, and the coinage ratio of a country was 
 its bid for the precious metals for coinage purposes.
 
 13 
 
 Some writers make the mistake of attributing 
 all movements of gold or silver from one country to 
 another to the action of Gresham's law. As a matter 
 of fact most of such movements are due simply to the 
 fact that these metals are money, or, in the bullion 
 state, that they are designed for coinage. The chief 
 cause of shipment is the settlement of balances of 
 trade, and next to this is the advanced interest rate 
 which one country gives above another. It is commonly \ 
 known that when the Bank of England wishes to draw \ 
 gold to that country the directors increase the discount 
 rate, putting a premium on money. Other things being 
 equal, gold is shipped in response to such a call, be- 
 cause, being less bulky, it is more easily and cheaply 
 transported.* The simplest test of the question whether 
 a certain movement of gold or silver is due to Gresham's 
 law is a comparison of the money system of the country 
 to which it moves with that of the country from which 
 it moves, for of necessity no such movement can be due 
 to an inherent quality of the money if the two countries 
 have similar money systems. There can be no profit in 
 traffic in money metals between two countries whose 
 money systems are the same, but there may be at any 
 time a movement of money for ordinary money uses. 
 For example, the money systems of Great Britain, 
 France, and the United States are now the same so far 
 as the quality of the money is concerned. They are all 
 on a gold basis, and all float silver and paper money on 
 a parity with gold by maintaining gold redemption of 
 both. They have different coinage ratios, but the 
 market value of silver is so far below its coinage value 
 in either of the three, that the difference of coinage 
 
 Note — See Statement of Alfred de Rothschild in Proceedings of Brussels In- 
 ternational Monetary Conference, p. 66.
 
 14 
 
 ratios cannot possibly afi'ect the market value of either 
 metal. Hence it is certain that neither the flow of gold 
 to England from the United States in the early summer 
 of 1893, nor the return flow to this country a few weeks 
 later, was due to Gresham's law. The outward flow 
 was due to the payment of balances of trade and the 
 premium on money in Europe. When our eastern banks 
 suspended money payments, and issued clearing house 
 certificates, money went to a higher premium here than 
 in Europe, and gold returned, not because it was gold 
 ; but because it was money. All money, gold, silver, and 
 I paper, was at a premium. Therefore, whatever might 
 have been the eflect of the Sherman law on our credit, 
 it is beyond question that these movements of gold are 
 
 \ 
 
 \ not to be explained by Gresham's law. 
 
 But, to return to commerce, I have said that the 
 effects of this difference of coinage ratios was enor- 
 mously increased by the development ot international 
 commerce. Perhaps this may be more clearly seen by 
 looking at historical facts. Lord Liverpool declared 
 that, " The evils resulting from the fluctuations in the 
 relative prices of these metals do not appear to have 
 shown themselves in any great extent, or at least to 
 have been the subject of general complaint, till the 
 reign of James I."* This is probably true, though as 
 early as 1553 Sir Thomas Gresham was complaining 
 that the new commerce of England had increased the 
 exchange value of " thirty-two shillings Flemish " from 
 twenty shillings sterling to twenty-six shillings eight 
 pence, and stoutly asserting that " plenty of merchants 
 without experience is the uttermostly destruction of 
 any realm. "f The spread of English foreign commerce 
 
 '■'Note. — Coins of the Realm, p. 117. 
 
 •j-NoTK. — Froude's England, Vol. 5, p. 131, note.
 
 15 
 
 under Elizabeth was great,* and by it the commerce in 
 
 gold and silver as commodities, with countries having 
 
 other coinage ratios, grew and produced its necessary 
 
 effects on England's coin. The laws were repeatedly 
 
 changed, but first one metal was exported and then the 
 
 other, as the ratio made profitable. The efl:ect on this 
 
 trafiic of the limited transportation facilities of the 
 
 period may be seen from the following extract from the 
 
 report of Sir Isaac Newton, director of the English 
 
 mint, in 1717. After explaining that in England the 
 
 bullion value of silver is greater than its coin value, the 
 
 English ratio being 1 to 15.86 — and that " When ships 
 
 are lading for the East Indies, the demand for silver 
 
 for exportation raises the price " by 1| to 3| pence per 
 
 ounce, he says : 
 
 Gold is in Spain and Portugal of sixteen times 
 more value than silver of equal weight and alloy, accord- 
 ing to the standard of those kingdoms ; at which rate a 
 guinea is worth 22s. Id. ; but this high price keeps 
 their gold at home in good plenty, and carries away the 
 Spanish silver into all Europe, so that at home they 
 make their payments in gold, and will not pay in silver 
 without a premium ; upon the coming in of a plate 
 {silver) fleet the premium ceases, or is but small; but as 
 their silver goes away, and becomes scarce, the premium 
 increases, and is most commonly about six per cent., 
 which being abated, a guinea becomes worth about 20s. 
 9d. in Spain and Portugal. * * * In China and 
 Japan, one pound weight of fine gold is worth but nine 
 or ten pounds of fine silver ; and in East India it may 
 be worth twelve ; and the low price of gold in propor- 
 tion to silver carries away the silver from all Europe. 
 So then, by the course of trade and exchange between 
 nation and nation in all Europe, fine gold is to fine 
 silver as 14 4-5 or 15 to 1 ; and a guinea at the same 
 rate, is worth between 208. 5d. and 20s. 8Jd., except 
 in extraordinary cases, as when a plate fleet is just ar- 
 rived in Spain, or ships are lading here for the East Indies, 
 
 Note. — Hume's England, Vol. 4, p. 205, et seq.
 
 16 
 
 which cases I do not here consider. And it appears by 
 experience, as well as by reason, that silver flows from 
 those places where its value is lowest in proportion to 
 gold, as from Spain to all Europe, and from all Europe 
 to the East Indies, China, and Japan; and that gold is 
 most plentiful in those places in which its value is high- 
 est in proportion to silver, as in Spain and England.* 
 
 The fact that the coinage of a nation was thrown out 
 of equipoise by the arrival or departure of a few ships 
 was due to the slowness, irregularity and cost of trans- 
 portation. The effects which Newton notes were seen 
 not only in England and Spain but also in the American 
 colonies and elsewhere. f As the volume of shipping 
 increased, the effect of commerce on the transportation 
 of metals grew so continuous and steady that it did not 
 cause sudden changes, and therefore did not attract the 
 same attention, but the effect was increasing — not de- 
 creasing. In this country the connection between the 
 movement of the money metals and the movement of 
 ships attracted comment even so late as 1833, when 
 Samuel Moore, Director of the Mint, reported to Con- 
 gress, "The fact, indeed, is familiar at the mint, that 
 gold coins often remain in the vaults, unclaimed by the 
 depositors, until the day of the departure of one of the 
 packets for Liverpool.";]: Indeed the stability of our 
 coinage under the act of 1792 was largely due to 
 the cost of and lack of facilities for transportation, 
 for although we undervalued gold by establishing a 
 ratio of 1 to 15, there was no premium on gold in 
 this country that attracted notice until 1821,§ and yet in 
 the course of the next twelve years it became an intoler- 
 able nuisance, and Congress changed the ratio, by the 
 
 *NoTE.— Proceedings Paris International Monetary Conference, 1878, p. 317. 
 fNoTE.— See collected instances in Del Mar's History of Money. 
 JNoTE.— House Doc. No. 38, ad Sess. aad Cong., p. 4. 
 gNoTE.— " " " " " pp. a. 10.
 
 17 
 
 act of 1884, to 1 to 15.98. This ratio was equally a 
 mistake because it undervalued silver, and yet our con- 
 ditions of commerce were such that it served the country 
 very well for more than fifteen years. It is often stated 
 that the new ratio at once drove silver out of the 
 country. This is not correct. I know of no better 
 witness on this subject than Hugh McCulloch, ex-Secre- 
 tary of the Treasury, who was engaged in banking 
 from 1835 to the beginning of the civil war. Speaking 
 ot his connection with the State Bank of Indiana, he 
 says : 
 
 Although the double standard existed in the United \ 
 States, the metallic currency of the country chiefly, and \ 
 throughout the West exclusively, from the time the 
 bank was organized, in 1834, to the discovery of gold 
 in California in 1848, was silver. The capital of the 
 bank was paid up in Spanish and Mexican dollars, and 
 its reserve continued to be in this coin until it was sold 
 for gold at a premium of about three per cent, on 
 Mexican dollars, and six per cent, on Spanish. I had 
 been a banker for fourteen years before I handled or ; 
 saw a dollar in gold except the ten-thaler pieces which y 
 were brought into this country by German immigrants.*/ 
 
 Although this result quickly followed the gold dis- 
 coveries in California, it was not due to them, but to a 
 change in our commerce produced by railroad building, 
 which fairly reached the eastern part of the upper Mis- 
 sissippi valley at this time. Before that our export was 
 by way of the Mississippi and the great lakes, chiefly 
 the former. Our import was chiefly across the moun- 
 tains by wagon or canal, and then by the Ohio and 
 wagon to destination. We sent goods down the Missis- 
 sippi in flat-boats, abandoned the boats, and brought 
 back silver. This silver was passed to the east for 
 goods. It was the Spanish and Mexican coin in univer- 
 
 NoTE. — Men and Measures of Half a Century, p. iig
 
 18 
 
 sal use in the Gulf country, and Spain and Spanish 
 America had the coinage ratio of 1 to 16, as we did. 
 Hence the silver did not begin to leave the country 
 noticeably until the railroads put the east and west in 
 direct commercial relations, with moderate cost for 
 transportation to the seaboard. Then it went swiftly. 
 In 1853 the drain had become so bad that Congress de- 
 based the fractional silver coins, and made them " token 
 money," in order to keep any change in the country. 
 
 Another striking instance of the speedy action of 
 Gresham's law in connection with modern commerce 
 is seen in the case of Japan, whose experience is said 
 by Jevons to present "the most extreme instance which 
 has ever occurred." He says : 
 
 At the time of the treaty of 1858 between Great 
 Britain, the United States, and Japan, which partially 
 opened up the last country to European traders, a very 
 curious system of currency existed in Japan. The most 
 valuable Japanese coin was the kobang, consisting of a 
 thin oval disc of gold about 2 inches long, and 1| inches 
 wide, weighing 200 grains, and ornamented in a very 
 primitive manner. It was passing current in the towns 
 in Japan for four silver itzebus, but was worth in Eng- 
 lish money about 18s. 5d., whereas the silver itzebu 
 was equal only to about Is. 4d. Thus the Japanese 
 were estimating their gold money at only about one- 
 third of its value as estimated according to the relative 
 values of the metals in other parts of the world. The 
 earliest European traders enjoj^ed a rare opportunity for 
 making profit. By buying up the kobangs at the native 
 rating they trebled their money, until the natives per- 
 ceiving what was being done, withdrew- from circula- 
 tion the remainder of the gold. 
 
 In 1860 the Japanese government, having observed 
 the effect of commerce on its money, changed the coin- 
 age ratio to 1 to 13|, but this undervaluation of gold 
 was sufficient to carry it away from Japan, as we shall 
 see hereafter. To sum up the matter, the vast growth
 
 19 
 
 of international commerce had made it practically im- 
 possible to maintain bimetallism so long as various 
 countries had diverse coinage ratios. The ancient 
 system that had served very well through preceding 
 centuries would not work under the new conditions. 
 It had become necessary that there should be practical 
 uniformity in the coinage systems of the commercial 
 world. 
 
 III. 
 
 The Work of the Council. 
 
 The movement for the correction of the evils result- 
 ing from diverse money standards in different nations 
 originated with the central countries of Europe, wliich 
 suffered greatly from those evils on account of their 
 clos^ commercial relations. It is frequently stated that 
 France maintained bimetallism at the ratio of 1 to 15^ 
 for the first seventy years of this century without regard 
 to the ratios of other countries. As a matter of I'act 
 France maintained that ratio, just as the United States 
 maintained its ratios of 1 to 15 and 1 to 16, that is to 
 say, its coins were drawn away or sent back according 
 to the demands made by the ratios of other countries. 
 That there may be no question on this point, I quote from 
 the report of the French committee on coinage of the 
 Universal Exposition at Paris in lb67, made by L. 
 Mathieu and Baron de Hock. Speaking of the disad- 
 vantages of bimetallism under existing conditions, they 
 say:
 
 20 
 
 These are not idle or theoretical fears. The exper- 
 ience of France, and in all the countries having 
 the double standard has demonstrated their reality. 
 Before the discovery of the rich mines in California, in 
 Australia, in the northwest of the United States, and 
 in the British North American possessions, gold having 
 a higher market price than the legal rate, the coins of 
 that metal disappeared from circulation, and could only 
 be obtained at a premium. After these discoveries, on 
 the contrary, gold having depreciated below the legal 
 rate, it was then the turn of silver to disappear. All 
 the masses of silver, which the Bank of France had 
 sought to accumulate at a great expense to obviate that 
 result, were soon exhausted. The retail business sufiered 
 very much, and finally no other remedy was found 
 but that of coining gold pieces of five francs (96 cents) 
 and silver change of .835 fine.* 
 
 While these gentlemen state a fact of which they 
 
 had personal knowledge, they do not state correctly the 
 
 causes that produced this result. The real causes are 
 
 mentioned in the report of this conference by Mr. Rug- 
 
 gles, our commissioner, though he appears not to have 
 
 caught their significance, as follows : 
 
 The interesting fact is stated in a historical rei:)ort 
 (recentl}' published by a member of the British Embassy) 
 of the money of Japan, that it possesses a coinage of 
 gold and silver in some essential features resembling 
 that of France, particularly in a double standard, under 
 which the ratio of silver to gold is fixed at 13| to 1. It 
 appears that, in ignorance of the actual relative values 
 of the two metals in our Atlantic world, (of 15 or 16 to 
 1) these pagan Asiatics had fixed the ratio at only 4 to 
 1, which great exaggeration of silver they were further- 
 more induced to continue by a treaty in 1858, under 
 which they were rapidly despoiled of their gold in large 
 quantities by some of the traders from Christian nations. 
 The partial correction of the mistake in 1860, by rais- 
 ing the ratio to 13| to 1, (if any ratio fixed by gov- 
 ernmental regulation be admissible at all,) shows an 
 advance of intelligence in this distant region, inspiring 
 the hope that, in due time, at least a portion of Eastern 
 
 Note. — Report of International Monetary Conference of 1867. Ex. Doc. 14, 2nd 
 Sess., 40th Cong., p. 23.
 
 21 
 
 Asia may be brought within a world-embracing and 
 world-protecting belt of monetary unification. * * * 
 The course of the monetary currents through mid-r 
 die and eastern Asia is instructively indicated by recent 
 statistical returns from Russia, showing that of the gold 
 and silver coin sent in 1865 from Russia overland into 
 China, through the international entrepot of Kiachta, 
 3,876,184 roubles were in silver, and only 327,979 roubles 
 in gold. 
 
 It was the high valuation of silver in the Orient, 
 with rapidly increasing commerce,.,that caused the silver 
 movement of 1850-1860. During that period the aver- 
 age ratio of the metals at Shanghai was 1 to 14.34 as 
 against an average ratio of 1 to 15.40 in the London 
 market.* That means an average difference of 7 per 
 cent, to cover profit and transportation. But when 
 Japan was suddenly opened to the commerce of Eng- 
 land and the United States, the market value of silver 
 at once advanced, and during the year 1859 and the 
 early part of 1860 maintained the highest average value 
 that had been known for years. Japan's temporary 
 coinage ratio of 1 to 13| afforded an exchange profit of 
 nearly 15 per cent, over the ratio of France. The 
 brief-continuing ratio of 1 to 4 gave an exchange profit 
 of 289 per cent. These advantages of commercial 
 exchange explain the rise of silver, as measured in gold, 
 in the European markets. That rise, in the decade 
 mentioned, was only 5 cents an ounce, or less than 4 per 
 cent. The great gold discoveries of that period did not 
 depreciate gold as compared with silver. The general 
 free coinage of both metals at fixed ratios prevented 
 any such result. The real effect was a gradual depre- 
 ciation in purchasing power of all money, as shown in 
 the general rise of prices. 
 
 Note. — Report of Silver Commission, Vol. i, p. 570.
 
 22 
 
 The central countries of Europe, in pursuance of a 
 common understanding, first endeavored to meet the 
 growing evil by national action. Switzerland, Italy and 
 France debased their fractional silver coinage, but 
 Switzerland reduced it to .8 fine, while the other two 
 made their's .835 fine. In consequence the Swiss frac- 
 tional coins were not received outside of Switzerland, 
 and on account of this inconvenience a formal union, in 
 which Belgium also was included, was formed in 1865. 
 The basis of this union was bimetallic free coinage at 
 the ratio of 1 to 15|, all standard coins being .9 fine, 
 with the five-franc piece (96J cents) as the unit. No 
 gold coins smaller than the five-franc piece were to be 
 coined, and all smaller silver coins were only .835 
 fine. These debased fractional coins were legal tender 
 throughout the union to the amount of 50 francs, and 
 the nation issuing them was bound to accept them to 
 any amount. The coinage of the four countries was 
 made uniform in denomination, size, weight and form. 
 For coins above five francs, each nation was permitted 
 to issue gold coins of 10, 20, 50 and 100 francs, but 
 could not coin other values. 
 
 This system worked so satisfactorily that in 18G7 
 an invitation was sent to all the nations to join in an 
 international monetar}'^ conference to be held in connec- 
 tion with the exposition at Paris in that year. Nineteen 
 nations sent representatives, and there seemed a fair 
 prospect of accomplishing something. They all agreed 
 that the diversity of coinage was injurious to com- 
 merce and governments. They all agreed that there 
 ought to be a system of international uniformity. , But 
 when it came to the details of that system there was a 
 remarkable diversity of opinion as to matters that seem
 
 •23 
 
 to be of little importance. Most of the delegates were 
 profoundly impressed with the advantages of the French 
 metrical system of weights and measures, and thought 
 it should be applied to coinage. There was an immense 
 amount of talk about grams, and millimetres, and 
 scientific standards, which was of little use, because 
 Measures of value are not only purely artificial, 
 but they are also intrinsically diflerent from any 
 other measures in that they can never be permanently^, 
 and definitely fixed. You might fix a relation between 
 the weight or the diameter of a gold coin and the length 
 of the earth's meridian quadrant, if the length of that 
 quadrant could be exactly ascertained, but you could 
 never fix any relation between the value of the coin 
 and the length of that quadrant. Our commissioner, 
 Mr. Ruggles, contended earnestly for a 25-franc coin 
 ($4.82|), as that would be a reasonable approximation 
 to both our five-dollar piece and the English pound 
 sterling, which coins were as small as these two nations 
 desired to issue in gold, but the Europeans objected to 
 this departure from the decimal system in force in the 
 Latin Union, and our Commissioner came home in a 
 state of exasperation on that account. The most extra- 
 ordinary thing about this, conference, however, was the 
 unanimity with which they decided against a bimetal- 
 lic standard, which was the chief distinction of the 
 Latin Union, whose success had led to this conference. 
 Almost without discussion, they agreed to the proposi- 
 tion that international money " is attainable on the basis 
 and condition of adopting the exclusive gold standard, 
 leaving each state the liberty of keeping its silver 
 standard temporarily." This proposition received the 
 support of every nation but Holland. Silver standard
 
 24 
 
 Russia, Austria and Prussia, gold standard England 
 and Portugal, bimetallic standard France, Italy, Swit- 
 zerland and United States, all voted for it. The only 
 man in the conference who seemed to have considered 
 the probable ettect of destroying silver as a standard 
 money, was Mr. Mees, the shrewd old president of the 
 Bank of the Netherlands, who stubbornly insisted that, 
 "He considered it inconvenient to adopt the gold stand- 
 ard everywhere, because it would reduce silver to change- 
 money, and consequently gold would rise in value." 
 
 Very little came of this conference in the line of 
 its original purpose. Spain, Finland, Hayti, Argentine 
 Republic, and Venezuela have adopted the franc value 
 (19.3 cents) as the unit of their coinage, and several 
 countries, including nearly all of Central and South 
 America, have issued coins in multiples of the franc 
 value, but that is all. It was an error — an act of supreme 
 folly — that the United States did not reduce the dollar 
 to the tive franc value (96.5 cents), and adopt a coinage 
 ratio of 1 to 15J in 1873, when we were using paper 
 money, and when nothing but coin contracts would 
 have been aftected. But unfortunately our "financiers" 
 were more interested in demonetizing silver than in 
 forwarding the cause of international money. Indeed 
 the same sentiment seemed to prevail everywhere, for 
 the adoption of the gold standard became the common 
 course, as will be seen from the following chronological 
 statement of monetary legislation, and some events 
 connected with, or altecting financial affairs: 
 
 1870. Franco-German war. 
 
 1871. Germany adopts law for gold standard, and 
 stops coining silver. 
 
 1872. Denmark, Sweden and Norway decide for
 
 25 
 
 gold standard. Germany retires silver coin. Payment 
 of French war indemnity. 
 
 1873. United States adopts gold standard. Begin- 
 ning of panic and trade depression that lasts until 1880. 
 Germany begins silver sales. Panic in Germany. 
 
 1874. Holland stops coining silver. Latin Union 
 restricts coinage of silver to $28,000,000 per annum. 
 
 1875. Holland demonetizes silver. Denmark, Swe- 
 den and Norway demonetize silver. United States 
 adopts law for resun^ption of specie payments on Janu- 
 ary 1,1879. 
 
 1876. Latin Union limits total silver coinage to 
 $120,000,000. United States takes legal tender quality 
 from trade dollar. 
 
 1877. Latin Union stops silver coinage and goes 
 to gold basis. Russo-Turkish war. 
 
 1878. United States begins silver purchases. Japan 
 abandons gold standard, and makes unit of value the 
 silver dollar of 420 grains. Great trade depression in 
 England. Failure of Glasgow City and West of Eng- 
 land banks. 
 
 1879. United States resumes specie payments on 
 gold basis. Germany stops silver sales. 
 
 1881. Argentine Republic attempts bimetallism 
 at ratio of 1 to 15.3. French panic. Collapse of the 
 Union Generale. 
 
 1884. Trade depression and labor crisis in France. 
 Panic in United States. 
 
 1885. Egypt demonetizes silver. Panic in Argen- 
 tine Republic — specie payments suspended. 
 
 1887. Turkey demonetizes silver, and prohibits its 
 importation. 
 
 1888. Panama Canal collapse. Panic in France.
 
 26 
 
 1890. Roumania demonetizes silver. United States 
 begins purchase of 54,000,000 ounces of silver per 
 annum. Panic in United States. 
 
 1891. Argentine collapse. Panic in England. 
 1898. Austria-Hungary resumes specie payments 
 
 on gold basis. India attempts gold standard. Bank- 
 ruptcy of Australia. Great panic in United States. 
 Financial troubles in Italy, Greece and other European 
 countries. 
 
 During these same years there occurred the most 
 remarkable movement in gold prices that has ever been 
 known, and which is shown in the accompanying table. 
 The figures speak for themselves, but a word of expla- 
 nation may be appropriate as to the " index numbers." 
 These show the movement of average prices with refer- 
 ence to a fixed standard which is called 100. Dr. Soet- 
 beer takes as a standard the average prices of 1847-50, 
 and his figures show the average movement of price of 
 100 articles on the Hamburg market and 14 articles of 
 British export. I use also the continuation of Dr. 
 Soetbeer's figures from similar material as published by 
 Prof. Taussig in " The Silver Situation in the United 
 States." Mr. Augustus Sauerbeck takes as a standard 
 the average prices from 1853 to 1877 inclusive, a period 
 of twenty-five years, and his figures show the movement 
 of price of forty-five articles in the London market. 
 The London Economist figures show the movement of 
 price of twenty-two leading articles in the London 
 market. They were prepared by Mr. Newmarch, who 
 takes for his standard the average prices of 1845-50 
 which were used by Jevons. These are usually given 
 on a basis of 2,200, i. e., 100 for each article, but I give 
 them as reduced to the basis of 100 for all, which is
 
 27 
 
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 •IMo .lad 'siren irio 
 
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 •uor^ jad 'sirea l^^:^S 
 
 D 
 
 60 
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 g 
 
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 ft 
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 ■qi .red 'jo^jna 
 
 •qi aad 'jeag H'Eg 
 
 •qi aad 'J{.iOd n^g 
 
 •qi asd 'pj'BT: 
 
 •pireidn 
 '■qi jad 'uo^:(oo 
 
 •nq aad 'luoo 
 
 •nq jad 'luaqM 
 
 S 
 
 -uioo aou-Buy a^-B 
 -uag "S •fi 'saoud 
 ai-BsaioqM aS-BjaAV 
 
 ■jsiiuouoog 
 uopuoi 'saiorij^ 
 gS anrBA a.8-BJaAv 
 
 •Jlo^qjan'BS 
 uopuoT 'eapHJ'B 
 g^ ani-BA aSiiiaAv 
 
 "oaaqieog 
 Sjnqiu-BH 'sapijjB 
 f.XT ani'BA aS-BjaAy 
 
 •aoud uopuoT[ ^-b j-enop 
 jQAiis -B JO eni^A uomng 
 
 •£1 "zo jad 'a9A{is jo 
 ani'BA uopuoi aS-BjaAy 
 
 
 
 "^OSCn-^CSLOCOCOtOO'^^OCOCOCvlCOOOOOOOO 
 
 r-iCMOiC£>lO'^'^'^<^CC"*COCOCgcCCOCOC<ICOCOOp 
 
 CvICqtMC^CacqrHi— IrHi-lTHCqiMC^Ir-trHr-irHT-lT-lT-H 
 
 
 
 
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 HOiHi— ii-HrH'-^r-lOOOOi-lTHO 
 
 
 tH rH rH 1-4 1-4 1-4 tH tH i-I T-H T-H T-4 r-i r4 
 
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 lO 00 CO OS 00 1--^ Q* i> .M i-H (^^ c<J '^* 00 CO N ^" cp op * • 
 
 rH tH 1—1 tH 1— I r-1 T-1 ^- T-H (H T-H ,— I H 1-H i-H tH rH T-H rH • • 
 
 c<iOoo:Da:)COOii>oooooo^c£>c^t>-iCc<iMi-i':£>t:* 
 0005Ciooaioobc:OoooooooooooL-^c-i>-t*oot^"X' 
 
 C<J0000'X>^rH'Mcc'2X)^O00'' 
 COCq(MCSJr-H'?qTHr-t'-''-t'-lr4i-'' 
 
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 E$- 
 
 c<jcoTt<ii:)i;£>i^-ooaiOrH'r>ico-^mc£>t^ooai<
 
 28 
 
 obtained by dividing the aggregate averages by twenty- 
 two. The figures of the Senate Finance Committee 
 show the average movement of wholesale prices in the 
 United States, and were prepared by the statistical 
 experts in the government employ for the report of the 
 committee to Congress.* It has been objected to the 
 index numbers of Dr. Soetbeer and the London Econo- 
 mist, by Hans Forssell, ex-Minister of Finance of 
 Sweden, and other monometallists, that they were 
 unfair because they did not consider the commercial 
 importance of the articles taken, and because a stand- 
 ard taken in the years 1845-50 was abnormally low. 
 Mr. Nash therefore prepared tables, taking as a stand- 
 ard the average prices of 1865-69, and also rating each 
 article in proportion to the total consumption. 
 
 Table 2. 
 
 Years. 
 
 
 Economist numbers, 
 
 without reference to 
 
 importance of articles. 
 
 Economist numbers, 
 
 with reference to 
 
 importance. 
 
 French numbers, 
 
 with reference to 
 
 importance. 
 
 1869-70 
 
 
 
 100 
 
 - 
 
 
 
 100 
 
 100 
 
 1870 
 
 
 
 91 
 
 - 
 
 
 
 90 
 
 91 
 
 1871 
 
 
 
 90 
 
 - 
 
 
 
 93 
 
 102 
 
 1872 
 
 
 
 97 
 
 - 
 
 
 
 100 
 
 105 
 
 1873 
 
 
 
 102 
 
 - 
 
 
 
 104 
 
 106 
 
 1874 
 
 
 
 100 
 
 - 
 
 
 
 108 
 
 97 
 
 1875 
 
 
 
 96 
 
 - 
 
 
 
 97 
 
 95 
 
 187G 
 
 
 
 93 
 
 - 
 
 
 
 99 
 
 95 
 
 1877 
 
 
 
 94 
 
 - 
 
 
 
 100 
 
 96 
 
 1878 
 
 
 
 87 
 
 - 
 
 
 
 96 
 
 91 
 
 1879 
 
 
 
 76 
 
 - 
 
 
 
 82 
 
 87 
 
 1880 
 
 
 
 87 
 
 - 
 
 
 
 89 
 
 88 
 
 1881 
 
 
 
 81 
 
 - 
 
 
 
 93 
 
 86 
 
 1882 
 
 
 
 83 
 
 - 
 
 
 
 87 
 
 84 
 
 1883 
 
 
 
 80 
 
 - 
 
 - 
 
 
 88 
 
 80 
 
 1884 
 
 
 
 75 
 
 - 
 
 - 
 
 
 80 
 
 
 1886 
 
 
 - 
 
 70 
 
 - 
 
 - 
 
 
 76 
 
 
 Note. — Report No. 1394,21! Sess. S2ti Cong.
 
 29 
 
 The foregoing table shows the result, and also the 
 result as to twenty-two articles in the French market, 
 computed on the same basis.* 
 
 A comparison of these figures shows the same 
 result as the original index numbers — a heavy and 
 almost continuous decline of prices. The monometal- 
 list objectors might have anticipated this if they had 
 stopped to think. The standard, in a question of rela- 
 tive movement, is immaterial, so long as it is fixed. If 
 we should take the prices of 1773, or of 1492, as the 
 standard, the relative movement would be the same. If 
 we should take the prices of 1872 or 1873 as the stand- 
 ard, and call it 100, and reduce the others to the same 
 basis, it would have no more effect than reducing a 
 fraction to its lowest terms. The matter of use or con- 
 sumption would be a factor of importance if we were 
 considering the expense of living, but it is of very little 
 importance considering the broader question of the 
 appreciation of gold. However, that is immaterial for 
 present purposes, for as we have seen the results are 
 practically the '^ame no matter how or when obtained. 
 The student of social economy must accept them as 
 ' facts, or deny all existing records of a statistical char- 
 acter. We may therefore proceed with the considera- 
 tion of the money question, in the light of these facts, 
 without any apprehension that they can be successfully 
 questioned. 
 
 What did Mr. Mees mean by saying that the gen- 
 eral adoption of the gold standard " would reduce silver 
 to change-money, and consequently gold would rise in 
 value ? " The word here translated " change-money " 
 is the French billo7i, which does not mean small coins, 
 
 Note.— A full explanation of this subject will be found by those who desire it in 
 the report of Mr. Edward Atkinson on "Bimetallism in Europe." Sen. Doc. 34, ist 
 Sess. 50th Cong.
 
 30 
 
 but debased coins or token money, such as is commonly 
 made for small change. Such coin does not circulate 
 on its intrinsic value but on credit. It is redeemable in 
 
 I 
 
 something else by the nation that issues it, and that 
 something is standard money, or money of ultimate 
 payment. The use of silver as token money was no 
 new thing to Mr. Mees' hearers. England and Portugal 
 had reduced all their silver money to that condition. 
 The Latin Union had made all coins below the five- 
 franc piece token money. The United States, in 1853, 
 had debased all its coins smaller than the dollar ; and 
 every country represented in the congress had more or 
 less money of the same kind. Of course, if gold were 
 made the sole standard all silver would be reduced to 
 token money. It would stand for so much gold. But 
 why should that increase the value of gold ? The issues 
 of billo7i had not affected it. 
 
 The reason is simple. More than nine-tenths of all 
 the business of the world is done on credit — by checks, 
 notes, bonds, open accounts, bills of exchange, etc. — 
 and this credit creates a nearly constant body of debt. 
 Some one is always getting out of debt, but others are 
 always getting into debt, so that ordinarily the volume 
 of debt is growing as the commerce of the world in- 
 creases. Occasionally we have a period of liquidation, 
 or hard times as it is commonly called, and then the 
 volume of debt shrinks some, but commerce shrinks 
 much more, and after such a period debt grows more 
 rapidly. On what does this volume of debt rest ? The 
 laws of every country give the creditor the right to de- 
 mand payment in money. Lands, stocks, and property 
 of all kinds are used as security for debt, but when the 
 creditor enforces payment in the courts, this property
 
 31 
 
 is sold and the money received is applied to the pay- 
 ment of the debt. No matter how much property the 
 debtor may have, he cannot compel his creditor to 
 accept anything but money in payment. In reality, 
 therefore, all debt ultimately rests on money — it can be 
 extinguished only by money if deman'ded — and in times 
 of general liquidation there arises a great demand for 
 money and a general shrinkage in the values of com- 
 modities measured in money. Economists have long 
 Recognized this dependence of credit on money. Jevons 
 says, writing as to England alone : 
 
 While the elasticity ot credit, then, may certainly 
 give prices a more free flight, the inflation of credit 
 must be checked by the well-detined boundary of avail- 
 able capital, which consists in the last resort of the 
 reserve of notes, equivalent to gold, in the banking- 
 department of the Bank of England. Prices tempor- 
 arily may rise or fall independently of the quantity of 
 gold in the country; ultimately they must be governed 
 by this quantity. Credit gives a certain latitude with- 
 out rendering prices ultimately independent of gold.* 
 
 But more than this, debt — or credit — does not rest 
 ultimately on all money, but only on standard money. 
 A large portion of the money of the world is credit 
 money. All paper money is evidence of debt. It is 
 the promise of some government, or some bank, to pay 
 in standard money. All token money is of the same 
 character, even though it may have an intrinsic value 
 that covers some part of its face value. Hence all gov- 
 ernments and all institutions that issue such money are 
 in a constant state of liquidation, i. c, they must be 
 ready always to pay a standard dollar for the credit 
 dollar they have issued. If the pressure of liquidation 
 becomes too great, and they are unable to maintain 
 
 Note. — Investigations in Currency and Finance, p. 32.
 
 32 
 
 such exchanges, they are said to " suspend specie pay- 
 ments," because the ordinary form of credit money is 
 paper. In such cases the credit money drops to a credit 
 value, or if it have an intrinsic value it may drop to 
 that value. When a country adopts the single gold 
 standard the only thing in which it can redeem is 
 gold, and it is under implied contract to redeem all its 
 credit money, whether paper or metal, in gold. In 
 other words it must maintain its credit money on a 
 parity with its standard money. In the United States 
 a question arose as to the intention of the government 
 in this regard because the act of 1890 provided that the 
 redemption of the " coin notes " by the Secretary of 
 the Treasury should be " in gold or silver coin, at his 
 discretion," and it was answered by both the great poli- 
 tical parties of the country that they would maintain 
 all money on a parity with gold. The Republican 
 party demanded that " the purchasing and debt paying 
 power of the dollar, whether of silver, gold, or paper, 
 shall be at all times equal." The Democratic party 
 pledged itself to such "safeguards of legislation" as 
 would maintain " the equal power of every dollar at all 
 times in the markets, and in payment of debt." 
 
 At the time Mr. Mees spoke, the debt of the world 
 rested on values of gold and silver, constituting the 
 world's supply or stock, that were nearly equal, but 
 ultimate credit rested heavier on silver than on gold, 
 for there were only two gold standard countries in the 
 world, while there were several silver standard countries. 
 In bimetallic countries it rested on both metals, because, 
 although they issued silver token money, they also 
 issued standard silver money, which was money of 
 ultimate payment, not redeemable in anything else.
 
 33 
 
 What Mr. Mees practically said was : If all the nations 
 adopt the gold standard, and reduce silver money to 
 token money, redeemable in gold, gold will appreciate 
 in value. Why ? Because the volume of debt resting 
 on silver will be taken from it and placed on gold, and, 
 in addition to that, the amount of governmental debt 
 represented by silver coins will also rest on gold. Gov- 
 ernments will be obliged to keep enough gold on hand 
 to maintain exchanges for their credit money, or they 
 cannot keep it at par. There will be a largely increased 
 demand for gold. The supply is limited. It must 
 appreciate in value. If you should kill half of the 
 horses in the world, the other half would appreciate in 
 value, because there is a certain amount of work to be 
 done by horses, and the decrease in number would make 
 an abnormal demand for those that remained. It is the 
 law of supply and demand. Increase the demand and 
 you cause an increase in value of the supply. 
 
 Was Mr. Mees right ? Have the results that fol- 
 lowed shown the correctness of his view ? We find a 
 great many persons who contend that gold has not 
 appreciated, but that silver has depreciated. Let us 
 consider this. In the table on p. 27 all values are 
 measured in gold, and appear to have fallen. Of course 
 the appearanee would be the same if the commodities 
 remained stationary and gold rose in value, because 
 they are measured in gold. On comparing the apparent 
 decline of silver with the apparent decline of other 
 articles, we find a remarkable uniformity between its 
 movement and the movement of average prices as 
 shown in the index numbers in columns 3, 4, 5 and 6 of 
 Table 1. Not only do they fall together but, practically, 
 at certain periods they rise together. Why is this ?
 
 34 
 
 Those who claim that silver has depreciated in value 
 say that the depreciation is due to increased and cheap- 
 ened production. If so, is it not a most Extraordinary 
 coincidence that its cheapening has been so uniform 
 with the average cheapening of other things, and still 
 more so that when other things grew dearer the cost of 
 producing silver suddenly increased ? Many advocates 
 of silver make a somewhat similar claim. They say 
 that silver has been " a steadier measure of value than 
 gold." There is nothing in the nature of silver that 
 would make it more stable than gold, and nothing 
 in the natural conditions ; on the contrary the demone- 
 tization of silver would naturally tend to depreciate it 
 more than the average of commodities. This uniform- 
 ity of movement is not a matter of chance. It is not 
 due to any intrinsic quality of silver. It results directly 
 and necessarily from the use of gold and silver as 
 money. It is impossible that the value of silver should 
 vary materially from the general average of values so 
 long as it is standard money in a part of the commer- 
 \ cial countries of the world, and gold is the standard 
 
 money of international commerce. 
 
 Let me endeavor to make this clear, for it is a fun- 
 damental principle of the utmost importance. Countries 
 that have silver as the standard money maintain free 
 coinage of silver, and therefore silver bullion is worth 
 what it would be worth in the coin of those countries, 
 less transportation and mint charges, unless specially 
 affected by speculation. In the daily market reports, 
 for example, you will find Mexican dollars quoted at 
 their bullion value, because it is practically the same to 
 send Mexican dollars, or so much bullion, to Mexico. In 
 silver standard countries silver is the measure of values. 
 
 t.
 
 35 ( 
 
 When you pass beyond the boundaries of those countries 
 both silver and other commodities are measured in gold. 
 Suppose that at Vera Cruz wheat were worth a dollar a / 
 
 bushel in Mexican silver or sixty cents in gold. It l 
 
 would be immaterial to the merchant there whether he 
 bought silver dollars or wheat with his gold, because he 
 could exchange one for the other, and he would pay the 
 same for one that he pays for the other. But merchants 
 deal in other things than wheat, and wheat fluctuates 
 in value from causes peculiar to itself; therefore the 
 value of silver is measured by foreigners by its average 
 purchasing power, and as in silver countries it is the 
 measure of values its average purchasing power, and 
 the average price of commodities are one and the same 
 thing. Mr. ISTormau is one of the few economists who 
 have perceived this truth, and with his characteristic 
 devotion to " the exchanges " he maintains that " an 
 altered relation of silver to gold necessitates an imme- 
 diate adjustment of prices between countries possessing 
 effective monetary systems, through the operation of 
 the exchanges of gold for silver and silver for gold, 
 affecting all articles interchanged between such coun- 
 tries." In other words the depreciation of silver would 
 cause a depreciation of all prices. As he puts it else- 
 where : 
 
 Is it not a fact that, upon a rise in the gold price of 
 silver, prices of articles interchanged between a gold 
 standard country and a silver standard country must be 
 adjusted to the changed relation between gold and 
 silver at once ? Has it, or has it not, been clearly 
 demonstrated that, in consequence of the higher silver 
 price of gold in silver standard countries since 1873, 
 the adjustment necessary has been effected by a fall in 
 the gold prices of commodities, etc., imported from 
 silver standard countries?* 
 
 Note. — The World's Metal Monetary Systems, pp. 98 and 164. See also pages 
 136, 152. 3'o-
 
 36 
 
 The incorrectness of this explanation is shown by 
 the fact that the fall of prices has not been confined to 
 commodities imported from silver standard countries, 
 but has occurred, on the average, with all commodities. 
 A depreciation of silver could not afiect prices in coun- 
 tries where silver is not standard money, any more than 
 a depreciation of cowry shells in India could affect 
 prices of commodities in the United States, or a depre- 
 ciation of Zulu cattle could afi:ect the price of dried fish 
 in Iceland. Neither can an appreciation of the price 
 of gold affect the prices of commodities in silver stand- 
 ard countries, I. e., as measured in silver under existing 
 circumstances, and it has not done so. There has been 
 a fall of prices everywhere if we measure them in gold, 
 but there has been no fall of prices anywhere if we 
 measure them in silver. The tables given show this as 
 to gold standard countries. The testimony from silver 
 standard countries is uniform. At the Brussels Confer- 
 ence of 1892, the stabilit}'^ of silver prices in Mexico 
 and India was conceded by all. Mr. Denby, our Minis- 
 ter to China, has shown the same condition in that 
 country.* The only complaint from those countries is 
 the increased price of exchange, or in other words the 
 depreciation of commodities and silver, as measured in 
 gold. Gold prices dominate in international commerce, 
 because gold standard countries dominate in inter- 
 national commerce. The commodities of silver stand- 
 ard countries are subjected to the gold measure as soon 
 as they become the objects of export, and their price 
 level, under the gold standard, is fixed by their barter 
 or exchange relation to the commodities of the gold 
 standard countries. Under the influence of universal 
 
 Note. — Consular Reports, No. 74, p. 508, No. 96, p. 317.
 
 37 
 
 cheap transportation and quick communication, the 
 movement of prices is practically the same throughout 
 the world, the chief variations being due to speculation, 
 which is at times made of considerable importance 
 locally through temporary suspension of the ordinary 
 effects of ready transportation. The " corners," and 
 " stringencies," and " pinches " of the speculative world 
 are local and temporary in character. As a rule the 
 London merchant buys and sells by telegraph in 
 America, Asia, Africa and Australia, and as a rule 
 prices move under telegraphic influence. Not even the 
 daily papers furnish information quickly enough for 
 the business of this era, but in all commercial centres 
 the " ticker" is an essential. Therefore we have a gen- 
 eral uniformity of price movements throughout the 
 world, and as silver's price in gold is controlled by its 
 use as a measure of value in silver standard countries, 
 we have in silver a steady measure of the movement of 
 gold prices, except as occasionally affected by specula- 
 tion. It may be objected to this that the movement of 
 silver is not identical with the movement of the index 
 numbers. It is not exactly so, because none of the 
 index numbers cover all commodities. The important 
 articles of real estate, live stock, labor, stocks and 
 securities, and others, are not included in any of them, 
 but it will be observed that the broader the basis of the 
 index number the more closely it approximates the 
 silver movement. For twenty years the price of silver 
 has been merely the record of the total average move- 
 ment of gold prices, and hence we may eliminate silver 
 from the discussion entirely. 
 
 Suppose that in the United States wampum were 
 the standard money. The price which the foreign trader
 
 38 
 
 would pay for wampum here would be the value of the 
 goods it would buy, and the value of wampum abroad 
 would be its purchase power here, less the cost of 
 bringing it here. An appreciation or depreciation of 
 gold would not afiect its purchasing power. If goods 
 go up abroad wampum goes up. If goods go down 
 abroad, wampum goes down. But if for any reason 
 there should be a change that afiected wampum alone, 
 it would be shown at once in prices here. If a cheap 
 process of making it were discovered, wampum would 
 go down and goods would go up. And so it is with 
 silver. So long as that metal retains its old relation to 
 the average of prices, it is evident that its appreciation 
 or depreciation measured in gold merely registers either 
 a change in gold or a change in the average of commo- 
 dities. The real question is whether gold has appre- 
 ciated or the average value of all commodities has 
 depreciated. There are some economists who hold that 
 " the appreciation of gold and the depreciation of 
 prices are one and the same thing." They are the same 
 in but one respect — they show the same result when 
 gold is used as the measure. But it is important to 
 know which movement has occurred, for if gold has 
 appreciated it is evidently due to the governmental 
 action of demonetizing silver, while if prices have 
 depreciated it has been due to a cheapening of produc- 
 tion or to some sort of natural increase of supply. If 
 the latter be true there is 'no remedy, and should be 
 none. If the former be true we should inquire if the 
 result is detrimental, and if so governments should 
 correct the evil. 
 
 Let us consider the evidence as to which movement 
 has occurred. In the first place there appears an ade-
 
 39 
 
 quate cause for the appreciation of gold, but no adequate 
 cause for a general depreciation of commodities. For 
 1890 the world's stock of the precious metals is esti- 
 mated by Mulhall at $6,175,000,000 gold, and $6,065,- 
 000,000 silver, coinage value. The officials of the U. S. 
 Mint report the production of the precious metals at 
 two billions each, gold and silver, from 1873 to 1891 
 inclusive.* In 1870 therefore the world's stock was 
 about four billions of each, and the credit of the world, 
 treating the entire stock as money, rested on eight 
 billions of gold and silver. The silver money stock of 
 silver standard countries is now estimated by our mint 
 officials at $985,000,000.t All the remainder of the 
 silver money of the world is token money, on a gold 
 basis. The credit of the world therefore rests on a 
 metal stock of six billions gold and one billion silver. 
 Of course the coin, or money stock, is considerably less 
 than the total metal stock, and there is certainly a 
 larger percentage of the metal stock in coin now than 
 there was in 1870, for coinage has been in excess of 
 production during these twenty years, as is shown in 
 Appendix 1, but it can hardly be doubted that the 
 volume of standard money in the world is less now 
 than it was in 1870. But while the amount of standard 
 money has decreased, or at the least has not increased, 
 the volume of debt has increased rapidly. The period 
 from 1870 to 1890 has been one of great enterprise and 
 great extension of commerce, improvement, and every- 
 thing that would naturally make debt. International 
 commerce has increased over 50 per cent. Domestic 
 commerce has increased much more. Railroad mileage 
 has increased about 200 per cent. The development of 
 
 ••■Note. — See Appendix i, also "Coinage Laws," 3(1 Ed., p. 95. 
 fNoTB. — See Appendix 2.
 
 40 
 
 new countries has been enormous. In addition to the 
 natural growth of debt from these causes, we now have 
 an additional burden of three billions of token money 
 silver, and an increased issue of about two billions of 
 paper money resting on thestandard money stock, or 
 practically on gold. It is difficult to get any just con- 
 ception of the amount of the world's debt. The last 
 census gives the total national debts of the world at 
 twenty-seven billions in 1890, and seventeen billions in 
 1870. The same authority fixes the total public debt 
 of the United States at two billions, of which 892 mil- 
 lions is national. It is certain that in this country the 
 bank debt is greater than the total public debt ; the 
 railroad debt is greater than the bank debt; the private 
 mortgage debt is greater than the railroad debt ; and 
 the open debt is greater than the mortgage debt. Pre- 
 sumably similar conditions exist elsewhere, and we may 
 safely assume that the volume of the world's debt is 
 not less than 300 billions, and that the private debt has 
 increased from 1870 to 1890 no less rapidly than the 
 national debts.* 
 
 This relative shrinkage of the base on which debt 
 rests, and by which it must ultimately be extinguished, 
 furnishes a reasonable explanation for the increase in 
 value of that base, but, on the other hand, where is an 
 explanation for a general fall in the values of commod- 
 
 NoTE. — Statistical returns indicate this. The mortgage debt of the " small 
 holdings " of peasants of Austria-Hungary increased 41.89 per cent, from 1867 to 1888. 
 The farm mortgages of Denmark show an increase since 1870 equal to 7 percent, of 
 the value of the estates. The increase of such debt in Prussia from 1886 to 1889 wai 
 342,210,000 marks, or nearly 1.5 per cent of the value of the estates. The indebted- 
 ness of the peasant proprietors of the Netherlands increased from 959,948 florins in 
 1883 to 1,888,872 in 1887, or about 97 per cent. The mortgage debt of the agricultural 
 districts of Sweden increased from ;C36i507,o64 in 1S77 to ;£so,797,o77 in 1876, or nearly 
 40 per cent. Publications of American Statistical Association, June, Sept., 1892, p. 
 iSi et seq. In the Political Science Quarterly for December, 1893, Mr. George K. 
 Holmes makes a somewhat larger estimate of the existing debt of the United States 
 than is here presented.
 
 41 
 
 ities in the past twenty years ? There has been some 
 cheapening of processes, but these apply almost wholly 
 to manufactures, and such manufactures show a greater 
 fall than the average, as, for example, steel rails and cut 
 nails, in Table 1. But where is the cause for the cheap- 
 ening of agricultural products? Is land cheaper? In 
 some places, yes. But such cheapening is either due to 
 an exhaustion of fertility, or it has followed the cheap- 
 ening of products, which made its cultivation unprofit- 
 able. Productive land is not cheaper. Is labor cheaper? 
 Monometallists say it is dearer, but we shall find cause 
 to question that hereafter. If it is dearer it would not 
 tend to make agricultural products cheaper, and cer- 
 tainly it has not cheapened sufficiently to cause any 
 great reduction in prices. Have we had any revolution 
 in agricultural machinery in twenty years ? No ; we 
 had reapers, and mowers, and threshers in 1870. There 
 has been an improvement of machinery in some respects, 
 but nothing that could make any such reductions of 
 prices as has occurred. Is the soil more fertile? No; 
 farmers are obliged to use fertilizers more extensively 
 every year. Is production increased? Yes; but not 
 materially more than consumption. Is transportation 
 cheaper ? Yes ; it has fallen about one-half in the past 
 twenty years, but the tendency of cheaper transporta- 
 tion is to reduce the price at the point of delivery and 
 increase it at the point of production. If it were not 
 for this, people in a new country would not make dona- 
 tions to induce the building of railroads, and farmers 
 would not expend money for roads. As we have seen, 
 prices have fallen everywhere. The prices of agricul- 
 tural products, in Table 1, are export prices. 
 
 But, in the second place, while there might be some
 
 42 
 
 question as to the aggregate efi'ect of these iiiflueuces 
 on prices, the possibility that they have caused a gen- 
 eral depreciation of commodities vanishes when we 
 compare the period of demonetized silver with other 
 periods. If there was anything to cause a cheapening 
 of commodities from 1872 to 1893 it was improved 
 machinery, cheapened transportation and new processes. 
 But these causes were certainly as efi'ective from 1850 
 to 1872 as they were from 1872 to 1893, and yet the 
 average prices of commodities advanced as steadily in 
 the earlier period as they declined in the later period. 
 Examine this little table of index numbers of price 
 levels from Mulhalls Dictionary of Statistics (p. 491). 
 
 
 
 Table 
 
 3. 
 
 
 
 Years. 
 
 Jevons. 
 
 London 
 Economist. 
 
 Hamburg. 
 
 Soetbeer. 
 
 Average. 
 
 1845-60 - 
 
 - - 100 
 
 - 100 - 
 
 100 - 
 
 100 
 
 100 
 
 1851-55 - 
 
 - - 107 
 
 
 
 112 - 
 
 114 
 
 111 
 
 1856-GO - 
 
 - - 120 
 
 - 127 - 
 
 121 - 
 
 125 
 
 123 
 
 1861-65 - 
 
 - - 123 
 
 
 
 124 - 
 
 127 
 
 125 
 
 1866-70 - 
 
 - - 121 
 
 - 140 - 
 
 124 - 
 
 125 
 
 127 
 
 1871-75 - 
 
 
 
 - 127 - 
 
 133 - 
 
 136 
 
 132 
 
 1876-80 - 
 
 - 
 
 - 115 • - 
 
 123 - 
 
 127 
 
 122 
 
 1881-84 - 
 
 ■ ...... 
 
 - 106 - 
 
 ' 118 - 
 
 124 
 
 116 
 
 Here are four independent records of price levels. 
 They differ from each other in exact amounts because 
 they do not include the same articles, but they all show 
 a steady rise in the price of commodities to the period 
 of demonetization, and a steady decline afterwards. 
 There is nothing in the relative efiect of cheapening 
 transportation, improving machinery or advance of pro- 
 cesses, that is not as true of one period as of the other. 
 There is but one great distinction between the two 
 periods, and it stands out so plainly that none may re-
 
 43 
 
 fuse to see it. In the earlier period the metallic money 
 basis on which credit ultimately rests was increasing 
 with greater rapidity than ever before or since, on ac- 
 count of the great gold discoveries in California, Aus- 
 tralia, the Rocky Mountain region and elsewhere. In 
 the later period the metallic money basis, on which 
 credit ultimately rests, was decreasing steadily, as one 
 nation after another demonetized silver and threw its 
 burden of credit on gold. This affirmative evidence is 
 as strong as could possibly be given in such a case, and 
 must be conclusive unless some opposing evidence is 
 strong enough to overthrow it. 
 
 Against it several arguments have been urged. 
 The first is that the rate of interest has not increased. 
 This looks plausible. If money is worth more, it would 
 naturally command larger hire. The fallacy of the 
 argument lies in the fact that the money paid for inter- 
 est has increased in value as much as any other money, 
 and therefore interest has increased without any ad- 
 vance of rate. Suppose that twenty years ago A made 
 a loan of |100 bearing five per cent, interest, and B 
 made a loan of 100 bushels of wheat at five per cent, 
 interest, payable in wheat. This year both came due. 
 A gets $200; B gets 200 bushels of wheat. A's $100 
 of interest has just as much appreciated value as his 
 $100 of principal. B's 100 bushels of interest has just 
 as much depreciated value as his 100 bushels of princi- 
 pal. The appreciation or depreciation of intrinsic value 
 cannot be measured by interest payable in kind. 
 
 A second argument is that there is more silver 
 money now than in 1873, and therefore no effect on 
 prices could have accrued from silver legislation. Un- 
 questionably the stock of silver money is largely in-
 
 44 
 
 creased. As shown in Appendix 1, the world's coinage 
 of silver for twenty years has been i^ excess of the 
 world's production. Of course a large amount of this 
 has been recoinage, but there can be little doubt that 
 there is now fifty per cent, more silver coin in use than 
 in 1873. The fallacy of the argument lies in the fact 
 that this silver is not standard money — not money of 
 ultimate payment. The special report of the mint on 
 August 16, 1883, shows a total money stock in circula- 
 tion in this country of $1,631,000,000, or $24.34 per 
 capita, which is more than we ever had before ; but 
 how much of it is standard money ? The stock consists 
 of $604,000,000 gold, $615,000,000 silver, and $412,000,- 
 000 uncovered paper. Of this, only the gold, which 
 amounts to $9.01 per capita, is standard money. The 
 remaining $15.33 per capita is credit money, which the 
 government is under obligations to redeem, i. e., to keep 
 on a parity with gold. It was this fact, coupled with 
 the facts that the government's gold reserve had fallen 
 to the $100,000,000 limit, and that the government was 
 issuing paper money in payment for silver bullion to 
 the amount of about $35,000,000 per annum, or at the 
 rate of thirty-five cents to each dollar of gold reserve, 
 that precipitated the panic of 1893. 
 
 A third argument is that some prices have not 
 fallen, and that if there had been an appreciation of 
 gold it would have caused a decline in all prices alike. 
 So far as it goes, the theory of this proposition is cor- 
 rect. The fallacy lies in the suppressed assumption 
 that there could be no special cause afl^'ecting the value 
 of any commodity that could counteract the effect- of 
 an appreciation of gold. This is manifestly untrue. 
 Everyone knows that the price of any one commodity
 
 45 
 
 is liable to rise or fall under any money system. Al- 
 though there was a general advance of prices from 1850 
 to 1870, and although it is conceded to be due to a de- 
 preciation of standard money, there were a number of 
 articles that decreased in price in that period — as for 
 instance, alkali, brass, candles, cement, coal, copper, 
 glass, lead, paper, sugar, etc. The obvious explanation 
 of this is that there were causes operating to cheapen 
 these articles which more than counteracted the effects 
 of the depreciation of gold. So, in the later period 
 there are articles, such as coffee. India-rubber, and tin, 
 that have advanced in price, although the average of 
 prices has fallen. The explanation must be sought in 
 causes particularly affecting such articles. The only 
 movement of prices on which an appreciation or depre- 
 ciation of money can be predicted is a movement of 
 average prices. 
 
 A fourth argument, and one much used in this 
 country, is that wages have increased, and that wages 
 are the best measure of the appreciation or deprecia- 
 tion of money. This is akin to the preceding argu- 
 ment. It is founded on this teaching of Adam Smith : 
 
 Labour, it must always be remembered, and not 
 any particular commodity, or set of commodities, is the 
 real measure of the value, both of silver (which was 
 then the standard of English money) and of all other 
 commodities. 
 
 This theory of Dr. Smith has long since been ex- 
 ploded. David Buchanan, in his edition of " The 
 Wealth of Nations,'' answers it thus : 
 
 The invariable value of labour seems a metaphysi- 
 cal notion, with which Dr. Smith has bewildered both 
 himself and his readers. The value of labour is its 
 market price, which varies, like that of other commod- 
 ities, with the state of the supply. But if it thus varies
 
 46 
 
 in its own value, how can it measure the value of other 
 commodities? Dr. Smith himself states that labour is 
 sometimes purchased with a greater, and sometimes 
 with a smaller quantity of goods; but he immediately 
 adds that it is the goods which vary in their value, and 
 not the labour. But why may not labour vary in its 
 value as well as the goods ? Will not the price of 
 labour vary with its plenty or scarcity ? And if it varies 
 in its own value, how can it be an universal measure of 
 value at different times and places? There is, in truth, 
 no perfect measure of value.* 
 
 The fallacy of Dr. Smith's proposition is almost 
 self-evident, for if you admit it to be true it necessarily 
 results than any apparent movement of average wages 
 is in fact a movement of money, and there can never be 
 any advance or decline of wages from any other cause. 
 The merest amateur in economy knows that this is not 
 true. In this country, one political party contends that 
 wages are advanced by a protective tariff, and another 
 that they are advanced by improved machinery, ex- 
 tended commerce, and steadier work. Workingmen 
 hold that the chief influence on wages is labor organi- 
 zation. No one holds to Dr. Smith's theory as ordinar- 
 ily expounded. Indeed he did not always hold to it 
 himself, for he says : 
 
 The money price of labour in Great Britain has 
 indeed risen during the course of the present century. 
 This, however, seems to be the effect, not so much of 
 any diminution in the value of silver in the European 
 market, as of an increase in the demand for labour in 
 Great Britain, arising from the great and almost uni- 
 versal prosperity of the country. f 
 
 What Dr. Smith evidently believed was that, other 
 
 things being equal, labor was a good test of prices, and 
 
 so it is, but it was much more so in his time than now, 
 
 because the causes which most actively affect wages 
 
 ••'Note. — Volume i, p. 59, note. 
 fNoTK. — Ibid, p. 333.
 
 47 
 
 now did not prevail then. But what has been the 
 movement of wages in recent years? The best author- 
 ity is the report of the Senate Finance Committee, 
 which, taking wages in 1860 as a standard, shows the 
 movement of the wage-level to have been as in the 
 accompanying table : 
 
 Table 4. 
 
 Year. 
 
 Index Number 
 of Wages. 
 
 Year. 
 
 Index Number 
 of Wages. 
 
 1862 
 
 90.8 
 
 1872 
 
 152.2 
 
 1853 
 
 91.8 
 
 1873 
 
 148.3 
 
 1854 
 
 95.8 
 
 1874 
 
 145.0 
 
 1855 
 
 98.0 
 
 1875 
 
 140.8 
 
 1856 
 
 99.2 
 
 1876 
 
 135.2 
 
 1857 
 
 99.9 
 
 1877 
 
 136.4 
 
 1858 
 
 98.5 
 
 1878 
 
 140.5 
 
 1859 
 
 99.1 
 
 1879 
 
 139.9 
 
 1860 
 
 100.0 
 
 1880 
 
 141.5 
 
 1861 
 
 100.8 
 
 1881 
 
 146.5 
 
 1862 
 
 100.4 
 
 1882 
 
 149.9 
 
 1863 
 
 76.2 
 
 1883 
 
 152.7 
 
 1864 
 
 80.8 
 
 1884 
 
 152.7 
 
 1865 
 
 66.2 
 
 1885 
 
 152.7 
 
 1866 
 
 108.8 
 
 1886 
 
 150.9 
 
 1867 
 
 117.1 
 
 1887 
 
 153.7 
 
 1868 
 
 114.9 
 
 1888 
 
 155.4 
 
 1869 
 
 119.5 
 
 1889 
 
 156.7 
 
 1870 
 
 133.7 
 
 1890 
 
 158.9 
 
 1871 
 
 147.8 
 
 1891 
 
 160.7 
 
 These figures show a steady increase of wages dur- 
 ing the first period, reaching at the close an advance of 
 sixty-eight per cent. During the second period we 
 have first a break in wages, and a failure to regain the 
 original level for ten years ; then a stationary period 
 of five years ; then a slow advance, reaching at 
 the close an increase of less than six per cent.
 
 , 48 
 
 over the beginning. It is certain that this slight ad- 
 vance has been changed to a decrease by wage reduc- 
 tions in 1892 and 1893, but that is not very material. 
 The essential point is, what stopped the increase of 
 wages'that was in progress from 1850 to 1870? All the 
 known causes for increasing wages were evpn more 
 active in the second period than in the first. There is 
 no imaginable cause, aside from the appreciation of 
 money, why the advance in the second period should 
 not have been as great as in the first. And in fact 
 wages did increase in about the same proportion when 
 measured by their purchasing power, i. e., by the aver- 
 age price of commodities. The retarded movement 
 appears only when measured in gold. The fact is, that 
 actual wages — wages measured by exchange value — 
 have advanced very uniformly from 1850 to 1891, and 
 that the check in money value is due to the apprecia- 
 tion of gold. These figures, however, cover organized 
 labor and skilled labor, which get the chief advantage 
 from improved machinery and new processes. When 
 we look at unskilled and unorganized labor, the result 
 is quite different. In this country the class of labor 
 least affected by these known influences, and most like 
 the labor with which Dr. Smith was familiar, is agri- 
 cultural labor. Our government has made nine special 
 investigations of agricultural labor, at intervals, from 
 1866 to 1892, and the result as shown by the report of 
 the statistician of the Department of Agriculture is as 
 follows :
 
 49 
 Table 5, 
 
 Year. 
 
 
 V 
 
 « 1- 
 > o 
 
 Harvest Wages 
 
 )er Day 
 Without Board. 
 
 Harvest Wages 
 
 per Day 
 
 With Board. 
 
 Ordidary Day 
 
 Wages 
 Without Board. 
 
 Ordinary Day 
 
 Wages 
 
 With Board. 
 
 1866 
 
 $26.87 
 
 $17.45 
 
 $2,20 
 
 $1.74 
 
 $1.49 
 
 $1.08 
 
 1869 
 
 25.92 
 
 16.55 
 
 2.20 
 
 1.74 
 
 1.41 
 
 1.02 
 
 1875 
 
 19.49 
 
 12.72 
 
 1.70 
 
 1.35 
 
 1.08 
 
 ,78 
 
 1879 
 
 16.05 
 
 10.43 
 
 1.80 
 
 1.00 
 
 .81 
 
 ,59 
 
 1882 
 
 18.58 
 
 12.41 
 
 1,48 
 
 1.15 
 
 .93 
 
 ,67 
 
 1885 
 
 18.06 
 
 12.34 
 
 1.40 
 
 1.10 
 
 .91 
 
 ,67 
 
 1888 
 
 18.24 
 
 12.36 
 
 1.31 
 
 1.02 
 
 .92 
 
 .67 
 
 1890 
 
 18.34 
 
 12.45 
 
 1.30 
 
 1.02 
 
 .92 
 
 .68 
 
 1892 
 
 18.60 
 
 12.54 
 
 1.30 
 
 1.02 
 
 .92 
 
 .67 
 
 It is evident from these recorded facts that if we 
 make wages the test there has beeu an appreciation of 
 gold ; but let us not be led into the belief that wages 
 furnish the final and accurate test of the appreciation 
 or depreciation of money, although the result favors 
 our position. They are subject to other influences, and 
 vary independent of the movements of money. Like 
 every other commodity, labor has influences peculiar to 
 itself, that affect it only, though the results will ulti- 
 mately react on commodities produced by labor. The 
 close harmony of movement between the gold price of 
 silver and the gold price of any one commodity is a 
 mere coincidence, not a necessary result, for the gold 
 value of silver measures average prices, under existing 
 conditions, and the harmony of price of any commodity 
 with average prices, proves merely that it has not been 
 subjected to any special disturbing cause. 
 
 In this consideration of the movement of prices, 
 thus far, we have eliminated silver from the question. 
 This was done for convenience, not from necessity.
 
 50 
 
 That there has, in fact, been no decline in the value of 
 silver from natural causes is evident from three facts : 
 
 1. Those who contend that silver has decreased iii 
 value assert that its production is enormously increased 
 — the world has been "flooded with silver." In fact 
 the production of silver, relative to the production of 
 gold, has decreased. During the first half of the pres- 
 ent century the world's stocks of gold and silver stood 
 very steadily in the ratio of 1 to 32, L e., for every ton 
 of gold in the possession of mankind there were 32 
 tons of silver. In 1849-50 began a great increase of 
 gold production, and the amount of gold produced 
 annually continued to be greater than the amount of 
 silver- until 1885, when the world's stock stood in the 
 ratio of 1 to 18.4. Since then the production of silver 
 has been slightly in excess, and the world's stock now 
 stands at a ratio of about 1 to 18.8. This is the rela- 
 tion in weight. In market value the relation of the 
 two metals varied but slightly until 1872, when the 
 great apparent decline of silver began*, and in 1872 the 
 weight ratio was about 1 to 20. It is impossible to ac- 
 count for a fall of silver, as measured in gold, by increased 
 production of silver, when gold production was increas- 
 ing more rapidly than silver production at the time the 
 apparent decline of silver began, and continued greater 
 than the production of silver for twelve years after. 
 It would require a production of silver enormously in 
 excess of anything existing, or in prospect, to bring the 
 world's stock of silver back to the ratio to gold that it 
 held in 1850. 
 
 2. It is contended that silver has decreased in 
 value because its production has been cheapened. This 
 
 Note — See Appendix 3.
 
 51 
 
 is not correct as compared with the production of gohl. 
 The cost of gold mining has always been less than the 
 cost of silver mining, and it has decreased more on ac- 
 count of improved methods. It is well known that in 
 California and other places miners are now working 
 profitably the " tailings" or refuse matter of the miners 
 of 1850 to 1860. The improvement of method in 
 placer mining has been so great that gold dirt has been 
 actually treated at a profit that paid less than three cents 
 per cubic yard.* The difference in the cost of produc- 
 ing the two metals is chiefly due to the fact that gold is 
 usually found chemically pure, while silver is usually 
 found in chemical combination and mixed with other 
 metals. When pure, either metal can be separated and 
 collected by amalgamation with quicksilver, or, as it is 
 commonly called, the '' free-milling" process. This, with 
 the possible exception of the collection of gold nuggets 
 by mechanical separation, is by far the cheapest pro- 
 cess of separation known, and it has been brought to a 
 state of great perfection by improvement in crushers, 
 stamps, amalgamation plates, and other machinery. 
 There have been many improvements in the processes 
 of silver extraction, but all processes, except free- 
 milling of native silver, require repeated handling of 
 the ore, which is the greatest expense connected with 
 any process. Anyone who endeavors to get at the ap- 
 proximate cost of silver production will find^j^ remarka- 
 ble conflict in different authorities. The chief cause of 
 this is the inclusion or exclusion of the value of the 
 other metals found in conjunction with silver in these 
 estimates. More than half of the so-called silver mines 
 of this country could not be worked at all but for the 
 
 Note. — U. S. Census Report, i88o, Vol. 13, p. 201.
 
 52 
 
 value of the lead, copper or gold they j'ield in addition 
 to the silver. Even the great " Bonanza" mines of the 
 Comstock lode are of this class. Their total product 
 from their discovery to January 1, 1893, was $141,986,- 
 344 gold, and $198,877,547 silver, but the dividends in 
 the same period, in excess of assessments, were only 
 $52,478,235. In other words, the expenses have been 
 nearly $90,000,000 in excess of all the silver produced. 
 
 3. It is claimed by many persons who are advo- 
 cates of the use of silver that silver has depreciated in 
 value because it has not been coined as freely as form- 
 erly since 1872. This is an error. As shown by Ap- 
 pendix 1, the world's coinage of silver since then has 
 been in excess of its total production. There has been 
 no decrease in the demand for silver, but there has 
 been an increase in the demand for gold, owing to the 
 fact that it has been made the sole money of ultimate 
 payment in so many countries. 
 
 With these preliminary facts in mind, let us now 
 consider the advantages or disadvantages of the ap- 
 preciation of gold. 
 
 IV. 
 
 The Case Against Monometallism. 
 
 The reader will bear in mind that we are to con- 
 sider this as a world question, with only secondary ap- 
 plication to any particular nation. In the presence of 
 such fluctuations in the market relations of gold and 
 silver as have prevailed in the last twenty years, it is
 
 53 
 
 impossible that any one nation should maintain bimetal- 
 lism at any ratio. Each one must make its choice be- 
 tween gold monometallism" and silver monometallism, 
 if action is to be taken by each singly. Silver mono- 
 metallism will never be accepted by the leading nations, 
 and indeed it would be no better than gold monometal- 
 lism if it were generally accepted. The world ques- 
 tion, therefore, is between gold monometallism and a 
 restoration of universal, or general bimetallism, freed 
 from the known and avoidable evils of the old bimetal- 
 lism. The position of those who are really entitled to 
 the name of bimetallists, in my opinion, is correctly 
 stated by M. Boissevain : 
 
 When, in the years immediately preceding 1870, M. 
 Wolowski and M. Cernuschi began their campaign in 
 favor of bimetallism, one after the other declared that 
 the system of the double standard, to produce its lull 
 effect, must be adopted internationally. And since then 
 the supporters of the movement have asked nothing 
 else. Never, indeed, have the bimetallists desired that 
 France alone, or the Latin Union, should go back on the 
 decisions taken from 1873 to 1878. Bimetallism has 
 always been defended as a system which absolutely 
 requires to be adopted by a convention or an under- 
 standing of an international character. It is not too 
 much to say that it is precisely this which distinguishes 
 bimetallism from the double standard system of former 
 times ; in this respect it is even directly opposed to the 
 old double standard system.* 
 
 In addition to fixing definitely what we mean by 
 bimetallism, let us also summarize and bear in mind 
 the following conclusions at which we have already 
 arrived : 
 
 1. That the real evil of the old double standard 
 system was the diversity of coinage ratios, and in a 
 smaller way the diversity of size and alloy in coins. 
 
 Note. — 'I'he Monetary Question, English Ed., p. 49.
 
 54 
 
 2. That this was the direct result of legislation, 
 and cau be cured b}' general harmony of legislation. 
 
 3. That during the era of demonetization of silver, 
 or general adoption of the gold standard, there has been 
 an almost continuous appreciation of gold, and conse- 
 quent decline of prices measured in gold. 
 
 4. That this appreciation of gold is due to the in- 
 creased burden of credit placed upon it by legislation, 
 and not to any natural cause, 
 
 5. That the market value of silver merely marks 
 the average gold price of commodities, and this is due 
 to the legislation which makes it the standard of value 
 in certain countries, and not to any natural cause. 
 
 The English monometallists concede the apprecia- 
 tion of gold, and consequent depreciation of prices. 
 Giff'en, the greatest of them, admits it. Norman con- 
 tends as zealously against the theories of David A. 
 Wells and his followers as he does against bimetallism. 
 The records of the London Economist, Soetbeer, Krai, 
 Sauerbeck, and others, are sufficient for them. In no 
 preceding period were statistics gathered so carefully. 
 In none was there such striking agreement in the 
 results wherever and by whomsoever ascertained. The 
 figures speak for themselves. If we cannot believe them 
 we cannot rely on statistics for anything. The chief 
 argument of the English monometallists is that a restora- 
 tion of bimetallism would be an injury to the creditor 
 class. In the sense that creditors would receive pay- 
 ment for existing debt in money that would have less 
 purchasing power than the same quantity now has is 
 true, because the purchasing power of money has been 
 artificially increased by the demonetization of silver. 
 But if any real injury resulted from this, which is
 
 55 
 
 improbable, it would necessarily be offset by the benefit 
 received by the debtor class. Who constitute the creditor 
 class and who the debtor class? The number holding 
 fixed and exclusive relations with either is so small as 
 to be insignificant. Every man who transacts business 
 is to some extent a debtor, and to some extent a creditor, 
 and it is from this fact that the great evil of the legisla- 
 tion towards a general gold standard has resulted. For 
 twenty years the world has been transacting business 
 on a falling market. There have been some reactions, 
 and there have been some lines of business that have 
 not been thus aft'ected, but on the average there has 
 been a remarkably steady trend downwards — indeed the 
 most remarkable movement of that kind the world has 
 ever known. There are few business men who do not 
 understand the injurious efltects of a falling market in 
 their own affairs. The merchant buys goods on credit; 
 the wholesale price goes down ; he is forced to compete 
 with merchants who have bought later at lower prices; 
 legitimate profits are reduced ; debt and interest are not 
 reduced. The manufacturer estimates the cost of ma- 
 terials, labor, fuel, etc.; he computes that on the existing 
 price of goods he can make a certain profit ; possibly 
 he borrows money to carry on his business; when the 
 goods are ready for sale the price has gone down. The 
 farmer, the packer, every man who has to invest in the 
 present and look to the future tor returns is similarly 
 affected by a falling market. Even bankers are fre- 
 quently caught by the depreciation of the securities 
 they have taken. For example, we are told by mono- 
 metallists that the recent great bank failures of Austra- 
 lia were due to speculation, booming, reckless backing 
 of enterprises, and the like, but Australian bankers
 
 56 
 
 earnestly deny this. One of them, Mr. David Murray, 
 
 says in a recent article : 
 
 The question is now forced upon us: Why is it 
 that banking, which was carried on successfully and 
 profitably from the earliest period of colonial history, 
 has in these last days suffered such reverses ? I think 
 there is only one answer to the question, which is, the 
 unaccountable and continuous fall in the value of all 
 securities. "Clear-sighted and practical financiers " 
 did not foresee it, and cannot account for it. Banks 
 advanced on these securities at a safe margin, quite as 
 safely as their advances were made twenty to thirty 
 years ago. These margins have now disappeared. The 
 produce of the colonies has fallen in value one-half. 
 The estates, the runs, the mines, the farms, all pro- 
 ducing factors, have fallen in a like ratio, not from scant 
 production but from diminished prices. 
 
 There is another reason why banks have suffered 
 largely in the last twenty years. A large portion of 
 the profit of banking comes from loaning at interest 
 the greater part of the money deposited by customers. 
 In times of financial stringency and general panic 
 bankers are forced to call in loans and hold heavy re- 
 serves as protection against possible runs. This means 
 a loss of ordinary and legitimate profits to the bankers, 
 as well as injury to customers, cramping of mercantile 
 and manufacturing business, discharge of laborers, and 
 general aggravation of the stringency. Did you ever 
 consider how frequent and how severe these periods of 
 stringency have been during the era of demonetized 
 silver? Mr. Giffen noted it and conceded that it was 
 due to the unusual demand for gold. Writing in the 
 spring of 1885 he said : 
 
 The course of the money market since 1871, when 
 the German government began to draw gold from Lon- 
 don, has been full of such stringencies. The crisis of 
 1873 and 1875 were no doubt precipitated by them, and 
 since 1876, in almost every year except 1879 and 1880,
 
 57 
 
 there has been a stringency of greater or less severity 
 directly traceable to, or aggravated by the extraordin- 
 ary demands for gold and the difficulty of supplying 
 them.* 
 
 Eight years have passed since Mr. GifFen wrote 
 this, but there has been no change in the frequent re- 
 currence of these stringencies. The results have be- 
 come more serious. The collapse of the Argentine Re- 
 public's eftbrt to adopt a gold basis, and the the crisis 
 produced by the Baring and Marietta failures, forced 
 the true cause on the attention of financiers, even 
 among the most obstinate of English monometallists. 
 In 1892 Alfred de Rothschild, while insisting that the 
 gold standard was absolutely necessary for England, 
 wrote to the Brussels international monetary confer- 
 ence : * 
 
 Gentlemen, I need hardly remind you that the 
 stock of silver in the world is estimated at some thou- 
 sands of millions, and if this conference were to break 
 up without arriving at any definite result there would 
 be a depreciation in the value of that commodity which 
 it would be frightful to contemplate, and out of which 
 a monetary panic would ensue, the far-spreading etfects 
 of which it would be impossible to foretell. f 
 
 The conference did not agree. The panic came. 
 What a remarkable fulfillment of prophecy ! And yet, 
 looking back over it all, we see plainly that the prophet 
 either did not fully understand or did not fully express 
 the true cause. It is impossible that mere depreciation 
 of value in silver should produce such results as have 
 been produced. There has been no trouble in silver- 
 standard countries. Gold-standard Australia, gold- 
 standard United States, gold-standard England, gold- 
 standard Italy and gold-standard Europe in general 
 
 '■'Note. — Essays on Fnance, ad Series, p. 26. 
 fNoTB. — Proceedings, p. 73.
 
 58 
 
 have suffered, but not silver standard countries. Why ? 
 Because the apparent depreciation of silver means an 
 apparent depreciation of all prices. It is the apprecia- 
 tion of gold. The gold-standard countries are doing 
 business on a falling market. This is the legitimate 
 and necessary result of the policy of the doctrinaires of 
 1867. This is gold monometallism so far as it has been 
 adopted. What of its further progress? When is the 
 world to be free from this evil if the process continues? 
 The history of the past twenty years furnishes some 
 light. As the nations one after another transferred 
 their burden of credit from silver to gold, gold appreci- 
 ated. The same cause will produce the same eflect. 
 No wonder M. de Rothschild so earnestly urged Europe 
 to join the Unitefl States in its effort to make an arti- 
 ficial demand for silver. No wonder Great Britain in- 
 structed its delegates to the Brussels conference " before 
 concluding that matters must be left as they are, to ex- 
 amine with the greatest care any plan which may be 
 submitted for the purpose of extending the monetary 
 use of silver.* No wonder that Giffen writes : " Still 
 more we ought to deprecate any change in silver-using 
 countries in the direction of substituting gold for any 
 part of the silver in use."t The English monometal- 
 lists now realize the truth of what Ernest Seyd wrote 
 in 1871: "It is a great mistake to suppose that 
 the adoption of the gold valuation by other states be- 
 sides England will be beneficial. It will only lead to 
 the destruction of the monetary equilibrium hitherto ex- 
 isting, and cause a fall in the value of silver from 
 which England's trade and the Indian silver valuation 
 
 =''NoTK. — Proceedings, p. 113. 
 
 fNoTE. — Essays in Finance, ist Series, p. 347.
 
 59 
 
 will suffer more than all other interests, grievous as the 
 
 general decline of prosperity all over the world will be." 
 
 The position of the English monometallists has 
 
 been that England and a tew other civilized countries 
 
 ought to retain the gold standard, but semi-civilized 
 
 countries — among which they seem to include the United 
 
 States — ought to maintain the silver standard. An 
 
 almost official declaration of this ie found in Mr. Gos- 
 
 chen's threat to the Paris monetary conference of 1878 : 
 
 The laissez /aire policy in India had done more than 
 anything else to keep up the value of silver. If, how- 
 ever, other States were to carry on a propaganda in 
 favor of a gold standard, and ot the demonetization of 
 silver, the Indian government would be obliged to 
 reconsider its position, and might be forced by events to 
 take measures similar to those taken elsewhere. In that 
 case, the scramble to get rid of silver might provoke 
 one of the gravest crises ever undergone by commerce. 
 One or two States might demonetize silver without 
 serious results, but if all demonetized there would be no 
 buyers, and silver would fall in alarming proportions. 
 
 * * * The American proposal for a universal 
 double standard seemed impossible of realization, a 
 veritable Utopia ; but the theory of a universal gold 
 standard was equally Utopian, and, indeed, involved a 
 false Utopia. It was better for the world at large that 
 the two metals should continue in circulation than that 
 one should be universally substituted for the other. 
 
 * * * At present there was a vicious circle ; States 
 were afraid of employing silver on account of the depre- 
 ciation, and the depreciation continued because States 
 refused to employ it. * * * It was not the fact of 
 this stock of £15,000,000 (Germany's discarded silver) 
 being in existence which depreciated prices so heavily. 
 If this same sum were in the United States Treasury in 
 place of an equal amount of gold, the aggregate stock 
 of silver would be unaltered, but this £15,000,000 would 
 no longer weigh on the market, and silver might be 
 restored to a normal position. It was in this direction, 
 and renouncing theoretical discussions, that the States 
 interested ought rather to direct their efforts.* 
 
 Note. — Proceedings, p. 51.
 
 60 
 
 Strange to say, our statesmen adopted this policy 
 dictated by England. We put the £15,000,000 into our 
 treasury, and we have put more than £60,000,000 more 
 on top of it. While we were doing it, Egypt, Turkey, 
 Roumania, and Austria-Hungary have gone to the gold 
 standard, and Argentine Republic and India have 
 attempted it. The appreciation of gold has gone 
 steadily on. Our silver purchases did not, and could not, 
 stop it, because we too had the gold standard, and no 
 part of our burden of ultimate credit rested on the 
 silver we coined. Now our eyes are partially opened, 
 and we have decided that we will no longer be the cats- 
 paw of England. There is not the slightest probability 
 that the LFnited States will resume the purchase system, 
 and scarcely greater probability that it will serve Eng- 
 land's purpose by making silver standard money until 
 the nations of the earth generally do the same thing. 
 
 Neither is there any probability that the present 
 silver standard countries will carry out the English idea 
 by remaining on a silver basis. How can they be per- 
 suaded to do so? They need international money as 
 well as the rest of the world. Already India has 
 attempted to make the change. Mexico is growing 
 restive, and feels that the premium of seventy-four per 
 cent, on gold which it encounters in international tran- 
 sactions is an injury to its commerce. Japan and China 
 are coming more and more under Occidental influences, 
 and are ambitious to range themselves in the front 
 ranks of civilization. They have adopted the most 
 modern appliances in their navies and armies. They 
 are educating their young men and young women in 
 Europe and America. Thirty-five years ago Japan 
 consented to open the doors to civilization. To-day the
 
 61 
 
 shops of Japan are furnished with telephones and 
 lighted by electricity. Nay, more, as I write this 
 chapter, the telegraphic dispatches announce that the 
 Japanese government is considering ways and means 
 for the adoption of the gold standard. It was a wild 
 vagary — a disregard of all human experience — to imagine 
 that these countries would stand against the greatest 
 of all civilizing forces, the international medium of 
 commerce. Their business interests protest daily against 
 such a course, in the natural and irrepressible demand 
 for a currency of universal and equal purchasing power. 
 How can these countries be kept from the gold stanard ? 
 Will it be said that they are not strong enough to reach 
 and hold it ? They are stronger than the countries of 
 Western Europe, because they are greater producers, 
 and because their industries are not subjected to so 
 crushing a weight of taxation. These causes never fail 
 of their effects. France is the greatest natural producer 
 of Western Europe, and France is now recognized as 
 the strongest, financially, of nations. The agricultural 
 nations can stand the strain of gold monometallism 
 better than others. They have food. The nations that 
 must break down first in this struggle are the manufac- 
 turing nations of Europe. There are but two possible 
 terminations to the movement started by the monetary 
 conference of 1867. One is the adoption of the gold 
 standard by the entire world. The other is the adop- 
 tion of international bimetallism. 
 
 Suppose the former results. Suppose we have 
 reached the goal. Suppose that through gigantic losses 
 and universal bankruptcy the world reaches a point 
 where gold has attained its maximum limit of appreci- 
 ation from this cause, and prices have touched their
 
 62 
 
 lowest point; have we gained or lost by the change? 
 What are the advantages of the single gold standard 
 when the world has it? The greatest excellence of any 
 kind of money is stability, because money is a measure, 
 and measures are of little use unless they are stable. 
 Anyone can see the injury to business that would result 
 from a yard-stick or a bushel that fluctuated constantly 
 and violently in size, and that injury would be no 
 greater than has been the injurj^ from the fluctuation in 
 the measure of value that has occurred in the past 
 twenty years. If an universal single gold standard can 
 be reached, would it be as stable as the bimetallic stand- 
 ard ? For two reasons it is impossible that it should be. 
 The first is that the contraction of the base on which 
 credit rests necessarily makes it subject to more fre- 
 quent and more violent fluctuations. If we should put 
 this proposition in the reverse form and ask the ques- 
 tion : " Does inflation of credit-money tend to stabil- 
 ity ? " no sane man would answer that it did. The 
 contraction of the base on which credit rests is the 
 same in effect as the extension of credit on an un- 
 changed base. For illustration, if a country has a 
 metallic fund of one hundred millions, and a paper 
 issue of three hundred millions, everyone would doubt 
 the safety of increasing the paper to six hundred 
 millions, but the relation between the two would be the 
 same in that case as if the paper were left unchanged 
 and the metallic fund were reduced to fifty millions. 
 The demonetization of silver is the exact equivalent of 
 inflation, so far as stability is concerned, not only for 
 the reason stated, but also because under it silver be- 
 comes credit-money which must be redeemed in gold. 
 Monometallism and inflation are equivalents, and the
 
 63 
 
 increase of burden on the basis or standard will always 
 cause greater fluctuation in the demand for, and value 
 of, the standard as the expansion and contraction of 
 credit occur. 
 
 In the second place the fluctuation of value in any 
 commodity may in fact be greater or less than the fluc- 
 tuation of average values, but the great desideratum in 
 money is something that will remain as nearly as pos- 
 sible with the average of prices, because money is the 
 medium of exchange, and exchange or barter is con- 
 ducted with reference to average prices. In other 
 words it is desirable that the money substance should 
 be affected as little as possible by influences peculiar to 
 itself, and not aflecting other commodities. If it were 
 possible to establish such a standard the average value of 
 all commodities would be the fairest and best measure or 
 standard of value. This is impossible, but it is possible 
 to keep in a money system the principle of average 
 value, or in other words to counteract to a large extent 
 the natural fluctuation that belongs to any individual 
 commodity. Necessarily the average value of two 
 commodities is less affected by these individual causes 
 than the values of the two commodities separately. If 
 the two articles can be fastened together at a fixed 
 ratio of exchange, as gold and silver may by universal 
 bimetallism, the result will be a money whose value will 
 be the average of the two. And even if, as monometal- 
 lists contend, and as in fact occurred under the old bi- 
 metallism with different coinage ratios in different 
 countries, a double standard results in the use of the 
 cheaper metal to the exclusion of the dearer, the use of 
 cheaper metal makes it dearer and the disuse of the 
 dearer metal makes it cheaper, so that the two are natur-
 
 64 
 
 ally drawn together. Under either theory an average 
 value of money is preserved that is more stable than the 
 value of either metal alone, or of the two maintained 
 separately as standards in different countries, as the 
 English monometallists recommend. 
 
 This fact was understood and explained by econo- 
 mists before the period of demonetization, and the con- 
 sequent new aspect of the discussion of bimetallism. 
 In the "Investigations in Currencj' and Finance" 
 written in 1862, but published after his^ death, Mr. 
 Jevons found it necessary to defend his proof of a 
 depreciation of the value of gold from 1850 to 1860 
 from the claim that if there had been such a deprecia- 
 tion it would be shown by comparison with silver. In 
 reply he pointed to bimetallism in France, and said : 
 
 And 80 long as there is much silver coin current in 
 France, and the law of the year 11 (establishing bimetal- 
 lism) holds, it will be possible for merchants, b}^ import- 
 ing gold and exporting silver, to gain the difference of the 
 natural and legal rates of value in France, minus charges 
 of coinage, insurance, etc. Very correctly Chevalier 
 argues that so long as this state of things lasts, it will 
 be impossible at London, Brussels, Hamburg, or even 
 at New York, or any other great center of commerce, 
 for gold to fall in value much below that of fifteen and 
 a half times its weight of silver. On these grounds he 
 calls the French silver currency a parachute which 
 retards the fall of the value of gold. Here is the great 
 oversight. The French currency may and does prevent 
 gold from falling much below its old relative value to 
 silver, but it cannot prevent both gold and silver from 
 falling in value. The inevitable conclusion drawn from 
 my table of prices is that gold has fallen say nine per cent.; 
 silver has risen in value compared with gold three per 
 cent.; the difference, six per cent., must necessarily repre- 
 sent the depreciation of silver.^ 
 
 In fact, both Jevons and Chevalier are right. 
 
 Note.— p. 60.
 
 65 
 
 Silver fell with gold, but retarded its fall. Not France 
 alone, but the bimetallic world produced the result. As 
 we have seen, silver and gold were prevented from 
 coming immediately into harmony by the Oriental 
 valuation of silver at a higher rate than the European 
 valuation, and as this passed away the two came together 
 again through the decade of the GOs., as may be seen 
 from the table of ratios, Appendix 3. The ratio of 
 1870-1872, is practically the same as the ratio of 1850- 
 1852, although the production of gold was still largely 
 in excess of the production of silver at the later period, 
 and the world's supply of gold, in relation to silver, had 
 been almost doubled. 
 
 Another very strong argument against monometal- 
 lism is its desertion by its adherents. A change of 
 opinion on a mooted question by a single person 
 amounts to little, but a strong trend in one direction 
 among those who give special attention to a subject is 
 very good evidence of the correctness of the position 
 to which they come. At the international conference 
 of 1867, there was but one delegate, Mr. Mees, the presi- 
 dent of the Bank of the Netherlands, who protested 
 against the single gold standard. The only other great 
 banker who shared his views at that time, of whom I 
 have knowledge, was Baron Alphonse de Rothschild, 
 who said in 1869, " As a sequel, we should have to 
 demonetize silver completely. That would be to destroy 
 an enormous part of the world's capital ; that would be 
 ruin." The economists who took positions against the 
 demonetization movement may be counted on the 
 fingers. Prof. Wolowski, of the College de France, 
 Cernusclii, and Ernest Seyd are the only ones of note. 
 Even in 1872 and 1873, when the demonetization meas-
 
 are was before our Congress, not one member of tbat 
 bod}' raised his voice in defense of the principle of 
 bimetallism, though this was perhaps due to oversight, 
 as the large majority of the members certainly had no 
 idea of the efl'ect of the bill. What a change has 
 occurred since then. In this country the most aggres- 
 sive advocate of gold monometallism was Hon. John 
 Sherman. He wrote to our delegate to the conference 
 of 1867 strongly urging it, and condemning *' the impos- 
 sible effort of making two standards of value."* He, 
 more than any other man, was responsible for this 
 country's joining in the movement. And yet, on July 
 15, 1878, he wrote Mr. Groesbeck, one of our delegates 
 to the conference of that year, as follows : 
 
 During the Monetary Conference in Paris, when 
 silver in our country was excluded from circulation by 
 being undervalued, I was strongly in favor of the single 
 standard of gold, and wrote a letter, which you will find 
 in the proceedings of that conference, stating briefly my 
 view. At that time the wisest among us did not antici- 
 pate the sudden fall of silver or the rise of gold that has 
 occurred. This uncertainty of the relation between the 
 two metals is one of the chief arguments in favor of a 
 monometallic system, but other arguments, showing the 
 dangerous effect upon industry by dropping one of the 
 precious metals from the standard of value, outweigh 
 in my mind all theoretical objections to the bimetallic 
 system. I am thoroughly convinced that if it were 
 possible for the leading commercial nations to fix by 
 agreement an arbitrary relation between silver and gold, 
 even though the market value might vary somewhat 
 from time to time, it would be a measurr of the greatest 
 good to all nations. My earnest desire is that you may 
 succeed in doing this.f 
 
 To this sentiment I believe Mr. Sherman still 
 
 adheres. At least he said in the Senate on May 31, 1892, 
 
 *NoTE.— Sen. Doc. 14, 2d Sess. 40th Cong., p. 107. 
 fNoTE.— Proceedin},'s Paris Monetary Conf. of 1878, p. 139,
 
 67 
 
 that '*Wlien the law of 1873 was passed the only trouble 
 about it was tliat we were not as wise as the Almighty 
 Ruler of the universe. We could not see ahead." And 
 in a continuation of the same speech, on June 1, lie said 
 " I am willing to stand hy the President, to aid him all 
 we can in an international conference." We may claim, 
 therefore, the conversion of the leader of the monometal- 
 list forces in America. Outranking Mr. Sherman as 
 a financier, we have Hon. Hugh McCuUoch, who, in 
 1867, was Secretary of the Treasury. He too supported 
 the movement for gold monometallism, though not so 
 actively as Mr. Sherman. He wrote to Mr, Ruggles, 
 our delegate, congratulating " the conference on the 
 result of its labors,"* and in his report of November 30, 
 1867, he referred the matter to Congress as " fully dis- 
 cussed in the separate report of Mr. Ruggles," specially 
 indicating as one of the points made by Mr. Ruggles, 
 " The necessity of a single standard exclusively of gold. 
 The fallacy and impossibility of a double standard of 
 gold and 8ilver."t And yet, in 1887, Mr. McCulloch 
 wrote this: 
 
 If Professor Sumner had been a banker at any 
 time prior to 1848, he would not have gone so wide of 
 the mark as he did in saying, in the 1885 June number 
 of the North American Review, "We do not want or 
 need silver as a circulating medium, and shall not 
 abandon it, because we never had it." We did have 
 it, and sooner or later we shall have it again, and with- 
 out its being degraded. We are not prepared — the 
 world is not prepared for the demenetization of either 
 gold or silver, nor can this preparation be brought about 
 without the wiping out of a very large part of public 
 and private debts. Debts contracted when both metals 
 are used as money would be a burden too heavy to be 
 borne when measured by a single standard. .j; 
 
 '■■Note.— Sen. Doc. 14, 2d Sess. 40th Cong , p. 82. 
 
 tNoTE.— Report, pp XLIIandXLIII. 
 
 |NoTE.— Men and Measures of Half a Century, p. iiy.
 
 68 
 
 When we pass to the lesser lights we find a verit- 
 able hegira from bimetallism. The congressmen of 
 1873, one after another, have declared that they did not 
 understand or did not know the contents of the act of 
 that year, and have disavowed faith in its provisions. 
 And this not only of members whose attention was not 
 specially called to it, but even members of the commit- 
 tees of the House and Senate who reported on it, and 
 Mr. Kelley, who originally introduced the bill in the 
 House, and who said in support of it : "All experience 
 has shown that you must have one standard coin, which 
 shall be a legal tender for all others, and then you may 
 promote your domestic convenience by having a subsi- 
 diary coinage of silver." I do not believe that any one 
 can point to a dozen Americans prominent in public 
 life, who avow themselves believers in the principle of 
 monometallism, though there are still a number of 
 economists and financial writers who adhere to it. 
 
 The growth of bimetallist sentiment in other 
 countries is quite as striking, when all conditions are 
 considered. The international monetary conferences of 
 1878, 1881 and 1892 furnish conclusive proof of the 
 world-wide belief that something ought to be done to 
 change the existing condition, and the existing condi- 
 tion is gold monometallism, so far as international com- 
 merce is concerned. The preponderance of sentiment 
 in all of these was for universal bimetallism, and it was 
 a- growing preponderance. The educational eflect of 
 these conferences has been immense, and the world is 
 under a debt of gratitude to Horton, Allard, Boissevain 
 and their colleagues, who have done so much to clear 
 away the debris of ancient monetary fallacies and lay 
 broad and deep the foundations of a real science. It is
 
 69 
 
 natural that there should have been less progress in 
 Germany and England than elsewhere, for the people 
 of both countries are characterized by a pugnacious 
 obstinacy that is not easily reconciled to change, even 
 in the right direction. Neither can we overlook the 
 influence of two phenomenal men, Bismarck and Glad- 
 stone, strong in the glory of past achievements and in 
 present political power, who have resisted the move- 
 ment. Bismarck, indeed, early expressed some disgust 
 at " the scramble for gold," and recently is said to have 
 been convinced of the error of gold monometallism. 
 Gladstone has sanctioned England's eitbrt to induce 
 other countries to endeavor to rehabilitate silver, but 
 nothing more, and it is hardly to be expected that men 
 of strong character would change their views on such a 
 question in old age. ^Nevertheless bimetallism has been 
 winning its way in both countries. It is commonly 
 conceded that Germany will follow if England will 
 join in the movement for universal bimetallism. 
 
 One of the most striking conversions in England 
 was that of Henry Hucks Gibbs, director and former 
 governor of the Bank of England, delegate of England 
 to the conference of 1878. At that conference he avowed 
 himself '' a partisan of the single gold standard," but 
 he subsequently had a complete change of view, and 
 became president of the English Bimetallic League. In 
 a public speech he said : 
 
 Mr. Goschen and I were together on the conference 
 in Paris; both of us were sturdy defenders of gold 
 monometallism, but I have changed my mind. I do 
 not say Mr. Goschen has changed his mind, but he has 
 somewhat modified it. 
 
 While Mr. Goschen does not avow conversion to 
 the principle of universal bimetallism he does announce
 
 70 
 
 views that concede nearly everything that bimetallists 
 claim. He has gone this far at a public meeting: 
 
 There is a class of monometallists who say that bi- 
 metallism is all nonsense, and they cannot understand 
 what it means, Now, I do not think that it is nonsense 
 at all. I think it is a very serious demand for a change, 
 which, if adopted, would produce very large results. 
 * * * The action of the Latin Union, the 
 action of Germany, the displacement of silver and the 
 enthronement of gold in its place, in many countries, 
 have had an immense effect in producing the changes 
 which bimetallists deplore and attempt to remedy. So 
 far, it appears to me, it can fairly be said that the ac- 
 tions of governments have a distinct influence on the 
 question of standards, I fully appreciate the import- 
 ance of the question. I feel it almost impossible to ex- 
 aggerate its importance.* 
 
 The view of Mr. Goschen here expressed appears 
 to be very much the most common view of English poli- 
 ticians who advocate the gold standard. At any rate 
 the Royal Commission on Gold and Silver, which re- 
 ported in 1888, and which was composed of six mono- 
 metallist and six bimetallists, assented unanimously to 
 the following proposition : 
 
 Sec. 107. We think that in any conditions fairly 
 to be contemplated in the future, so far as we can fore- 
 cast them from the experience of the past, a stable ratio 
 might be maintained if the nations we have alluded tot 
 were to accept and strictly adhere to bimetallism, at the 
 suo'o'ested ratio. We think that if in all these countries 
 gold and silver could be freely coined, and thus become 
 exchangeable against commodities at the fixed ratio, 
 the market value of silver as measured by gold would 
 conform to that ratio and not vary to any material ex- ■ 
 tent. 
 
 It may be mentioned in this connection that since 
 
 the report of this commission Mr. Leonard H, Court- 
 
 '■'NoTK — Proceedings Brussels Conference of 1892, p. 224. 
 
 tNoTH. — The United Kingdom, Germany, the United States and the Latin 
 Union.
 
 71 
 
 iiey, one of the mouometallist members, has openly 
 avowed his conversion to bimetallism. 
 
 Why, then, does not England consent to universal 
 bimetallism? Simply because these politicians believe 
 that the present condition is better for England because 
 it is a creditor nation. Mr. Gladstone put it on that 
 ground in the discussion of the question in Parliament 
 in February 1893, and no one could have put it more 
 bluntly. He said : 
 
 The honorable member spoke rather with ridicule 
 upon the proposition of this country as the great 
 creditor country of the world. It is the great creditor 
 country of the world; of that there can be no doubt 
 whatever; and it is increasingly the great creditor 
 country of the world. -I suppose there is not a year 
 which passes over our heads which does not largely add 
 to the mass of British investments abroad. I am 
 almost afraid to estimate the total amount of the property 
 which the United Kingdom holds beyond the limits of 
 the United Kingdom ; but of this I am well convinced, 
 that it is not to be counted by tens or hundreds of mill- 
 ions. 
 
 One thousand millions probably would be an ex- 
 tremely low and inadequate estimate. Two thousand 
 millions, or something even more than that, is very 
 likely to be nearer the mark. ["Hear!" "Hear!"] 
 1 think under these circumstances it is a rather serious 
 matter to ask this country to consider whether we are 
 going to perform this supreme act of self-sacrifice. I 
 have a profound admiration for cosmopolitan principles. 
 1 can go a great length in moderation [laughter] in 
 recommending their recognition and establishment, but 
 if there are these two thousand millions or fifteen hun- 
 dred millions of money which we have got abroad, it is 
 a very serious matter as between this country and other 
 countries. 
 
 We have nothing to pay to them ; we are not 
 debtors at all ; we should get no comfort, no consola- 
 tion out of the substitution of an inferior material, of a 
 cheaper money, which we could obtain for less and part 
 with for more. We should get no consolation, but the 
 consolation throughout the world would be great. 
 [Loud laughter.]
 
 7-2 
 
 This splendid spirit of philanthropy, which we can 
 not too highly prize, because I have no doubt all this is 
 foreseen, would result in our making a present of fift}' 
 or a hundred millions to the world. It would be thank- 
 fully accepted, but I think the gratitude for your benev- 
 olence would be mixed with very grave misgivings 
 as to your wisdom. 
 
 Mr. Gladstone and his followers have the idea that 
 a money system which increases the burden of debt 
 benefits the creditor, and they will probably cling to it 
 unless the actual losses of the creditors, from the break- 
 ing down of debtors, show them their mistake. The year 
 1893 must have been very instructive to them. Of 
 course the English economists, who attempt to defend 
 monometallism on principle, cannot take such a posi- 
 tion. Giffen was moved to such wrath by the conces- 
 sion of the Royal Commission quoted above, or, as he 
 says, by public men Jiolding similar views, that he de- 
 clares " it is surely a scandal of the first magnitude that 
 men of light and leading in other respects should have 
 talked seriously, even if only for a moment, of any 
 such idea as the possibility of a fixed price between 
 gold and silver."* And this is about the only argument 
 left to GifiTen's school unless we may so account his 
 further proposition : " The only way, then, to deal 
 with bimetallists is to refer them back to Adam Smith 
 and other expounders of the A B C of monetary 
 science. "t And they do refer to Smith and Locke and 
 other authorities, seemingly oblivious to the fact that 
 these giants of their day were discussing the money 
 system of a single country when other countries were 
 maintaining diverse coinage ratios. They did not discuss 
 universal bimetallism at all. Their views are accepted 
 
 *NoTK. — Case Against Bimetallism, p. 131. 
 fNOTB. — /^»rf, p. 207.
 
 freely by the bimetallists of to-day as to mere national 
 action, but we have come to a time when money must 
 be recognized as an international, and not merely a 
 national matter. 
 
 It must not be imagined, however, that all English 
 economists follow Gitten. On the contrary the trend 
 is strongly in the opposite direction. In proof of this 
 I submit the following statement of Prof. H. S. Fox- 
 well, the distinguished professor of political economy 
 in University College, London, in his recently pub- 
 lished letter to M. de Laveleye, the well known 
 bimetallist : 
 
 Cambridge University : Professor Alfred Marshall, 
 bimetallist; Professor Sidgwick, bimetallist. Edin- 
 burgh: Professor Nicholson, author of an excellent 
 book on the subject, vice-president ot the Bimetallic 
 League. Oxford : Thorold Rogers admits the scarcity 
 of gold, rejects bimetallism. University College of 
 London : H. S. Foxwell, vice-president of the Bimetal- 
 lic League. Nottingham : Professor J. E. Symes, bi- 
 metallist. Liverpool: Professor E. G. Gonner, vice- 
 president of the Bimetallic League. Manchester : 
 Professor J. E. Munro admits the bimetallic theory. 
 London, King's College: Professor Edgeworth inclines 
 towards bimetallism. >ti * * Whoever re- 
 fuses to admit that a fixed ratio between gold and silver 
 can be established and maintained by international 
 treaty is no longer considered among us an economist. 
 
 This progress of bimetallism — this steady process 
 of conversion of men who study the subject — in such 
 marked contrast with the almost universal prevalence 
 of the monometallist sentiment of 1867 — is surely good 
 evidence of the merit of the bimetallic theory, and it 
 also gives ground for hope that the nations may soon 
 be brought to the point of abandoning the folly of the 
 past twenty years.
 
 74 
 
 V. 
 
 The Remedies Proposed. 
 
 It is not possible that events of tlie striking char- 
 acter heretofore noted as having occurred, in the past 
 twenty years, and especially events so disastrous in 
 their nature, should occur without attracting the gen- 
 eral attention of statesmen, financiers and students of 
 social economy. In all civilized nations they have been 
 repeatedly considered in legislative bodies. Newspapers 
 have found in them topics for extended discussion. 
 The permanent liter^iture on the subject has grown to 
 great proportions. More significant than all these is 
 the fact that since the monetary conference of 18G7 
 three international monetary conferences have been held 
 for the purpose of devising some cure for the existing 
 evil, for the monetary conditions of the past twenty 
 years are conceded on all sides to have been evil and 
 productive of evil. Even more striking is the fact that 
 monometallists as well as bimetallists maintain that 
 there must be a more extended use of silver as money, 
 or affairs will continue to grow worse. !Naturally from 
 this great amount of consideration there have come 
 numerous propositions for relief, and though these vary 
 greatly in their general character, as well as in detail, 
 they all group logically in three classes, which we will 
 now consider briefly. 
 
 The first class includes the various proposals for an 
 extension of the use of silver, or its equivalent, as 
 token money, on a gold basis. There are two facts 
 common to all these plans that deserve special notice. 
 The first is that these are tlie plans ol' the monometal-
 
 75 
 
 lists — monometallistp, for though mauy who have 
 favored such plans call themselves bimetallists, it is 
 simpl}' a contradiction of terms to speak of bimetallism 
 on a monometallic basis. Any system that does not 
 make silver a standard money — a money not ultimately 
 redeemable in gold — is a monometallic system. The 
 second is that only remedial plans of this character have 
 been given any trial in the past twenty years, and they 
 have all failed most dismally. Nor is this strange if 
 we will but bear in mind the rudimentary principle 
 which we have established that the cause of all the 
 trouble was taking the burden of ultimate credit oft" 
 from silver and placing it all upon gold. Necessarily 
 no additional use of silver on which no burden of ulti- 
 mate credit rests can relieve the pressure upon gold. 
 On the contrary the more silver token-money there is 
 issued the greater is the burden of credit that rests 
 upon gold, and the greater the demand for and appre- 
 ciation of gold. As we have already noted, the amount 
 of silver coined in these twenty years has exceeded the 
 amount produced, but gold has continued to appreciate 
 notwithstanding this, and notwithstanding that more 
 gold has been coined than has been produced. 
 
 The principal trial of plans of this class has been 
 the purchase of silver by the United States under the 
 Allison (or Bland) law of 1878, and the Sherman law of 
 1890. This policy, proposed as we have seen by Mr. 
 Goschen, at the conference of 1878, was followed by 
 this country for fifteen years. Under it we have accumu- 
 lated in our treasury more than five times as much 
 silver as he then thought would be necessary to restore 
 the old equilibrium, but the market ratio has constantly 
 gone farther and farther away from it. The reason is
 
 76 
 
 simple. Both our laws provided for the purchase of 
 silver at the market rate, and coinage into token money 
 redeemable in gold. The market rate of silver, as we 
 have seen, has merely marked the general average of 
 gold prices, or in other words the appreciation of gold, 
 and the purchase of silver has no effect of retarding 
 this; but the coinage of silver as token money, or the 
 issue of notes against silver bullion, adds to the burden 
 of credit resting on gold, and appreciates it still more. 
 Hence the policy which we have so persistently followed 
 has aggravated the evil instead of remedying it, and if 
 the nations had adopted the advice of Rothschild at the 
 conference of 1892, the situation would have been so 
 much the worse. 
 
 Second in importance only to this, is the plan of 
 issuing no bank notes or other paper currency of small 
 denominations, and thereby forcing a more extended 
 use of silver in the small transactions which make up 
 the great bulk of the world's business. This plan has 
 been followed by the States of the Latin Union and 
 some other European powers, and is advocated by many 
 monometallist " friends of silver " in this country. This 
 plan is not harmful, for the reason that the burden of 
 credit placed on gold by the issue of such silver token 
 money is certainly no greater than the burden of the 
 paper money it displaces ; but at the same time it is 
 utterly without efiect, for the reasons mentioned above, 
 in retarding the appreciation of gold or the deprecia- 
 tion of silver. The silver so issued is not standard 
 money — not money of ultimate payment — and is floated 
 only by being constantly redeemable in gold by the 
 government that issues it. 
 
 Another proposition of this class which has been
 
 77 
 
 received with considerable favor in this coiiiitrj, is Sec- 
 retary Wiiidom's scheme for issuing government notes 
 against deposits of silver bullion, redeemable in silver 
 bullion at its market value when the notes are presented. 
 A moment's thought will show any one that this plan is 
 based on the hypothesis that the source of the money 
 trouble is a decline of silver — not an appreciation of 
 gold. If this hypothesis were correct, this plan would 
 probably tend to remedy the evil, but it is not correct. 
 What effect could such a plan have in reducing the pur- 
 chasing power of gold ? Obviously none. The whole 
 transaction is on a gold basis. Silver is deposited at its 
 gold value, and paper is issued on it at the same rate. 
 The paper is redeemable in silver bullion at its gold 
 value. If gold continues to appreciate, as it certainly 
 will under existing influences, the government would 
 have to purchase enough silver bullion to cover the 
 depreciation, or, what is equivalent, redeem in gold. 
 This could have no more effect on the movement of 
 gold than would the deposit of wheat, or diamonds, or 
 any other commodity, under similar circumstances. It 
 is mere warehouse 'business, with the disadvantages of 
 subjecting the country to unlimited inflation and pos- 
 sibly sudden contraction of the volume of currency. 
 The fundamental fallacy of all plans of this class is that 
 they are not aimed at the real evil, but at an imaginary 
 one. 
 
 The plans of the second class include all proposi- 
 tions for free coinage of silver, at a fixed ratio, by indi- 
 vidual nations, and this proposal has received very 
 earnest support in the United States. At the present 
 time most of the intelligent advocates of this plan con- 
 cede that the inevitable result of its trial would be
 
 78 
 
 silver nioiioiuetallisni, but insist tliat silver inonometal- 
 lisni is preferable to gold monometallism. If this were 
 the only choice, and there were in fact no hope of a 
 general restoration of bimetallism, we might reasonably 
 agree with them, for certainly a standard that under 
 existing circumstances must move with the movement 
 of average prices is much more desirable than a stand- 
 ard under which prices are utterly unsettled, and under 
 which no man can do business with any certainty of 
 results. It is hardl}' worth while to enter into any 
 argument to show that the necessary result of the free 
 coinage of silver by this country alone would be silver 
 monometallism. Our own experience has shown us 
 that we could not maintain actual bimetallism when 
 our coinage ratio varied but a fraction from a compara- 
 tively uniform market ratio. Our gold was carried away 
 under our early overvaluation of silver, and our silver 
 was carried away under our later overvaluation of gold. 
 If any further proof were needed of the utter impossi- 
 bility of maintaining bimetallism under the present 
 extreme and violently fluctuating market ratio it may 
 be found in the examples of the States of the Latin 
 Union, which were obliged to abandon the attempt, or 
 our neighbor, Mexico, under whose bimetallic laws 
 silver monometallism is an accomplished result. The 
 only question that is open, in connection with a propo- 
 sal for free coinage by a single nation, is whether silver 
 monometallism is desirable. 
 
 The greatest objection to it is that it would not be 
 a settlement of the money trouble. It would leave us 
 farther from the money of international commerce than 
 we have ever been, and it would leave us subject to the 
 constantly recurring demand for money that is good
 
 79 
 
 everywhere. Tbis demand comes chiefly from the mer- 
 cantile classes, but unquestionably there is an earnest 
 desire among all classes, in the United States for money 
 that is good in any part of the world — money that does not 
 rest on credit — just as there is in all civilized countries. 
 Indeed one great cause of objection to our present 
 system of gold monometallism, with silver token money, 
 is that we do not have " an honest dollar" — a dollar 
 that is good all round the world. Our eagle, double 
 eagle, half-eagle, and quarter-eagle, are good every- 
 where, but our dollar is worth only about sixty cents as 
 soon as it goes beyond our boundaries, except where 
 affected by a prospective return to them. This objec- 
 tion is not made by gold monometallists alone, but by 
 bimetallists also. As Mr. Beith put it, on behalf of 
 the bimetallists of England, at the meeting at Man- 
 chester, on October 27, 1892 : "We ask that the gov- 
 ernment shall take measures in concert with the other 
 great nations of the world, to arrange one money for 
 the commerce of the world — that is, that the Queen's 
 shilling, the Queen's rupee, and the Queen's dollar, shall 
 run as freely as the Queen's sovereign, in every part of 
 the Queen's empire, and of the world." This is a 
 demand that is urged both by the needs of commerce 
 and by national pride, and there is no reason for sup- 
 posing that either will be less potent in the future than 
 at present. 
 
 If now we should pass to silver monometallism this 
 objection would be still more forcible. Under the present 
 system we maintain relations witli the money of inter- 
 national commerce by constantly redeeming our silver 
 money in gold, or in other words, maintaining it on a 
 parity with gold; but under silver monometallism we
 
 80 
 
 would entirely abandon the money of international 
 commerce, and our own money would become merely a 
 commodity to the commercial world, as Mexico's money 
 now is. There would of course result at least a tem- 
 porary increase in the value of silver, or rather a 
 decrease in the purchasing power of gold, if we were to 
 transfer our burden of credit from gold to silver, but it 
 could not be very large, and it would probably be 
 quickly overcome by other nations passing from the 
 silver to the gold standard. Our dollar would be worth 
 as much abroad as at home, but it would be worth only 
 the bullion value ef the silver in it anywhere, and the 
 discrepancy between this and the value of the gold 
 coins in multiples of its denomination would be a con- 
 tinual cause of dissatisfaction. Gold would be "at a 
 premium," and the continual clamor whiclf this would 
 produce would prevent an adherence to the system. 
 This is not a speculative assertion. During the past 
 twent}' years we have seen this influence turn nation 
 after nation from the silver standard to the gold 
 standard, and even now the desire for money of the 
 commercial world's standard is so strong in the remain- 
 ing silver standard countries that they will certainly 
 attempt the gold standard unless international bimetal- 
 lism is speedily accomplished. In the United States the 
 demand for money of this quality is now so decided that 
 a silver standard could scarcely be considered a pos- 
 sibility even if it were in other respects desirable. 
 
 Beyond this lies the further consideration that this 
 remedy is not sufficient for the disorder. Unless all the 
 conclusions that we have reached in these pages are 
 erroneous, and unless all the bimetallists and advocates 
 of silver are mistaken, the existing disorder is a result
 
 81 
 
 of the appreciation of gold, not a depreciation of silver. 
 No remedy can be effective unless it brings gold back 
 to its former relation to average prices. That relation 
 was destroyed not by the demonetization of silver by 
 any one country, but by a general demonetization by 
 the leading commercial nations. It can be restored only 
 by a system which will again place the burden of credit 
 equally on gold and silver throughout the world. Of 
 course no one country could accomplish this by going to 
 a silver standard, but it is urged that if a strong nation 
 like the United States were to lead the way to bimetal- 
 lism other countries would follow. It is not to be sup- 
 posed that they would follow until they saw the result 
 of our attempt, and if the United States were to attempt 
 free coinage of silver, and go to a silver standard 
 as it necessarily must, the result would discourage 
 other nations from attempting a similar course. 
 They would see our attempted bimetallism a failure. 
 They would see us shut out from the money of the 
 commercial world. Instead of leading the way we 
 should block the way. Hence, as a step towards the 
 restoration of bimetallism, towards the rehabilitation of 
 silver, towards the readjustment of prices, free coinage 
 by any one country, under existing circumstances, 
 would be an error. Our opportunity to lead is in the 
 way of inducing other nations to take the step with us. 
 
 The third class of propositions includes those which 
 call for bimetallism, either universal or by a number of 
 countries in league under conditions that will tend to 
 produce universal bimetallism. The objection at once 
 made to these is that other countries will not join — that 
 England and Germany at least would stand out against 
 a proposition of this character. This objection has been
 
 82 
 
 considered sufficient in the past. Probably it is suffi- 
 cient still to prevent an imniediate universal arrange- 
 ment. It is primarily a question whether the experi- 
 ence of 1893 has been enough to convince the moneyed 
 power of England that the creditor is benefited by the 
 prosperity of the debtor. But, supposing that a present 
 universal agreement is impossible, may not that end be 
 ultimately reached by a present league or union of the 
 nations that desire a restoration of bimetallism ? This 
 would depend on two questions: (1.) Could a league 
 be formed that would be strong enough? (2.) Could 
 the league nations protect themselves against the drain 
 of gold to the non-league countries that would natur- 
 ally result under the economic laws which have been 
 heretofore explained ? It seems probable from the senti- 
 ment expressed in the later international monetary con- 
 ferences, and from existing national relations, that the 
 countries of the Latin Union, Russia, Spain, Holland, 
 China, Japan, Mexico, and all of Central and South 
 America would join in such a league if an affirmative 
 answer could be given to the second question. And 
 these nations are certainly strong enough, with the 
 United States, to maintain bimetallism if that drain of 
 gold can be prevented. How can it be prevented ? As 
 we have seen it always arises from a difference in money 
 systems that permits of a profit from commerce in 
 money — from making one of the money metals a com- 
 modity. If such a league were formed, the drain of 
 gold from league to non-league countries would natur- 
 ally occur in the form of a practically direct exchange 
 of silver for gold. This could easily be prevented by 
 imposing on all silver, coined or uncoined, imported 
 from non-league countries, a duty higher than the differ-
 
 83 
 
 ence between the market value of silver and its coinage 
 value in the league countries. This would not only 
 prevent an exchange of silver for gold, but would also 
 necessitate the payment in gold or commodities for all 
 goods shipped from league countries to non-league 
 countries, and therefore create a flow of gold to the 
 league countries. 
 
 If this plan were adopted there would still remain 
 three causes for export of gold from league countries to 
 non-league countries : (1.) The payment of existing 
 debts in gold. (2.) The shipment of gold for loan pur- 
 poses under influence of a high interest rate in non- 
 league countries, or for other ordinary money purposes. 
 (3.) The payment of gold for goods. The first of these 
 could not well be prevented, so far as gold contracts are 
 concerned, but it is not an item of sufiicient importance 
 to cause apprehension. The second would be self-com- 
 pensating, because all such movements would be in the 
 nature of loans, and would have to be repaid in kind. 
 The third is the most important, and it might be pre- 
 vented either by imposing prohibitory duties on the 
 imports from non-league countries, or duties sufliciently 
 high to discourage trade with them, and turn the trade 
 of the league countries to each other. In other words, 
 shut England and Germany, and their dependencies out 
 from the commerce of the remainder of the world. 
 
 It will be objected that such a system would be one 
 of coercion. This is true, but it would be a coercion 
 arising entirely from self-defense against nations which 
 insist on making an illegitimate profit out of money — 
 illegitimate because money as the medium of commerce 
 is properly a measure. There should be no more pos- 
 sibility of making a commercial profit from money
 
 84 
 
 than there should be from an open and avowed altera- 
 tion of any other measure. A dishonest dollar is as 
 dishonest as a dishonest yardstick. A fluctuating dol- 
 lar is as great an evil as a fluctuating yardstick. The 
 whole world is interested in having money as stable as 
 possible, and when England objects to what her Royal 
 Commission has agreed would give stability, solely on 
 the ground that as a creditor nation an abnormally 
 appreciated money is a national advantage to her, En- 
 gland loses all moral right to object to coercive meas- 
 ures. As a matter of course such a division of the 
 world would not last long. England and Germany 
 cannot exist without the commerce of the world — at 
 least not so easily as the world can exist without them. 
 To save themselves they would be obliged to join in the 
 movement, and so universal bimetallism would be ulti- 
 mately secured. 
 
 And universal bimetallism is worth a determined 
 effort. As the world now stands it has two standards of 
 value, gold and silver, and when any nation passes from 
 one to the other the whole world feels the shock. No 
 nation can control its own measure of value while this 
 condition lasts. Did you ever consider the enormous 
 significance of this fact? The United States adopted 
 the gold standard in 1873, and the efiect of that move- 
 ment certainly did not last longer than 1879, when we 
 actually came to the gold standard by the resumption 
 of specie payments. And yet since then we have been 
 subjected to renewed appreciation of our standard and 
 renewed falls of prices as other countries came to the 
 same standard, although we have made most strenuous 
 efforts to prevent the appreciation of one metal by buy- 
 ing another. It may be objected, however, that our
 
 85 
 
 efforts to befriend silver have caused our troubles. 
 Very well. Look at England. It has been steadily 
 true to the golden idol. It has not been trying to 
 bolster up silver. It has not altered its standard 
 by any act of its own. And yet the action of 
 other countries has altered its standard and made 
 a fall of prices similar to that in this country. 
 There is no way at present to prevent any country from 
 adopting any standard it likes, and if one desires a 
 change the rest of the world has no choice but to 
 endure the consequences. There is but one way to be 
 free from this evil, and that is for the nations to come 
 to a common standard, and adhere to it. There is no 
 possibility that such standard should be either metal 
 alone. It must be both, or we must remain as we are. 
 
 If universal bimetallism could be attained through 
 the preliminary step of a bimetallic league, as proposed, 
 it would be more beneficial than a direct advance to 
 that condition, for two reasons. In the first place, a 
 league once formed, with features of protection and 
 coercion, would serve to perpetuate bimetallism after it 
 was secured. It would aftbrd the means of speedy 
 punishment, by commercial exclusion, to any nation 
 that abandoned the league agreement. This is of 
 importance, because one of the objections commonly 
 urged to international bimetallism is the declaration 
 that there could be no means of enforcing the agree- 
 ment if any nation should violate it. If commercial 
 exclusion could force England and Germany into 
 agreement, it would certainly be sufficient to prevent 
 any nation from abandoning the agreement. In the 
 second place, a league compact would require fixed 
 rules and a representative body to enforce them, and to
 
 86 
 
 pass on questions of concern to the league. This would 
 inevitably lead to further steps towards international 
 unity and that "brotherhood of man" which is to the 
 best minds the ideal development of the human race. 
 Indeed, international money, of itself, would have an 
 effect in that direction that could hardly be overrated. 
 The race differences that separate mankind are chiefly 
 mere matters of custom, and this is one matter of univer- 
 sal importance, and which is daily and hourly forced on 
 the notice of all people, in which varying customs 
 could easily and profitably be made uniform. Success 
 in it would be strong inducement to attempt similar 
 reform in other matters. It is, therefore, The "World's 
 Silver Question in the broadest sense of the term.
 
 87 
 
 APPENDIX I. 
 
 The World's Production and Coinage of Gold and 
 Silver from 1873 to 1892. 
 
 (Special Report of Bureau of the Mint, August 28, 1893.) 
 
 
 GOLD. 
 
 SILVER. 
 
 Calendar 
 
 
 
 
 
 Year. 
 
 Production. 
 
 Coinage. 
 
 Production. 
 
 Coinage. 
 
 1873 
 
 $112,663,249 
 
 $267,630,802 
 
 $94,126,214 
 
 $131,544,464 
 
 1874 
 
 104,674,672 
 
 136,778,387 
 
 95,676,214 
 
 102,931,232 
 
 1876 
 
 102,935,769 
 
 206,340,209 
 
 90,076,214 
 
 123,143,842 
 
 1876 
 
 110,318,358 
 
 213,119,278 
 
 96,600,775 
 
 123,677,164 
 
 1877 
 
 113,947,173 
 
 173,675,556 
 
 81,040,665 
 
 78,402,648 
 
 1878 
 
 119,092,786 
 
 188,386,611 
 
 94,882,177 
 
 161,191,913 
 
 1879 
 
 107,386,421 
 
 90,752,811 
 
 89,080,680 
 
 104,888,313 
 
 1880 
 
 106,436,786 
 
 149,726,081 
 
 96,704,978 
 
 84,611,974 
 
 1881 
 
 103,023,078 
 
 147,015,275 
 
 102,168,364 
 
 108,010,086 
 
 1882 
 
 101,996,640 
 
 99,697,170 
 
 111,802,337 
 
 110,786,934 
 
 1883 
 
 95,392,000 
 
 104,845,114 
 
 116,088,000 
 
 109,306,706 
 
 1884 
 
 101,694,000 
 
 99,432,795 
 
 110,773,000 
 
 96,832,084 
 
 1886 
 
 108,436,600 
 
 95,767.582 
 
 118,446,160 
 
 126,764,674 
 
 1886 
 
 106,163,877 
 
 94,642,070 
 
 120,626,800 
 
 124,864,101 
 
 1887 
 
 106,774,955 
 
 124,992,465 
 
 124,280,978 
 
 163,411,397 
 
 1888 
 
 110,196,916 
 
 134,828,853 
 
 140,706,413 
 
 134,922,344 
 
 1889 
 
 123,489,200 
 
 168,901,519 
 
 162,169,200 
 
 139,242,696 
 
 1890 
 
 120,465,300 
 
 149,095,866 
 
 173,743,000 
 
 151,032,820 
 
 1891 
 
 126,168,800 
 
 119,310,014 
 
 186,174,200 
 
 135,508,083 
 
 Totals ... 
 
 $2,080,144,679 
 
 $2,752,927,456 
 
 $2,204,166,349 
 
 $2,309,962,273
 
 88 
 
 APPENDIX 2. 
 
 
 H 
 
 W 
 
 03 
 
 w 
 
 H 
 
 • 
 
 
 « 
 
 f^ 
 
 1-1 
 
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 89 
 
 APPENDIX 3. 
 
 The Market Ratio of Gold to Silver from 1867 
 
 TO the Present. 
 
 (The figures to 1893 are from the Report of the Director of the MintI) 
 
 Tear 
 
 W 
 P 
 
 Year 
 
 .2 
 
 Year 
 
 
 
 Year 
 
 o3 
 
 Year 
 
 2 
 
 
 o' 
 
 
 tf 
 
 
 a 
 
 
 tf 
 
 
 1687 
 
 14.94 
 
 1729 
 
 14.92 i 
 
 1771 
 
 14.66 
 
 1813 
 
 16.25 
 
 1855 
 
 15.38 
 
 1688 
 
 14.94 
 
 1730 
 
 14.81 
 
 1772 
 
 14.52 
 
 1814 
 
 15.04 
 
 1 1856 
 
 15.38 
 
 1689 
 
 15.02 
 
 1731 
 
 14.94 
 
 1773 
 
 14.62 
 
 1815 
 
 15.26 
 
 1857 
 
 15.27 
 
 1690 
 
 15.02 
 
 1732 
 
 15.09 
 
 1774 
 
 14.62 
 
 1816 
 
 15.28 
 
 1858 
 
 16.38 
 
 1691 
 
 14.98 
 
 1733 
 
 15.18 
 
 1775 
 
 14.72 
 
 1817 
 
 15.11 
 
 1859 
 
 15.19 
 
 i09Z 
 
 i4.yz 
 
 1 ItO-i 
 
 io.sy 
 
 liiO 
 
 14.55 
 
 1818 
 
 15.35 
 
 1860 
 
 15.29 
 
 1693 
 
 14.83 
 
 1735 
 
 15.41 
 
 1777 
 
 14.54 
 
 1819 
 
 15.33 
 
 1861 
 
 15.50 
 
 1694 
 
 14.87 
 
 1736 
 
 15.18 
 
 1778 
 
 14.68 
 
 1820 
 
 15.62 
 
 1862 
 
 15.35 
 
 1695 
 
 15.02 
 
 1737 
 
 15.02 
 
 1779 
 
 14.80 
 
 1821 
 
 15.95 
 
 1863 
 
 15.37 
 
 1696 
 
 15.00 
 15.20 
 15.07 
 
 1738 
 
 14.91 
 14.91 
 14.94 
 
 1780 
 
 1781 
 
 1782 
 
 14.72 
 14.78 
 14.42 
 
 1822 
 
 1823 
 
 1824 
 
 15.80 
 15.84 
 15.82 
 
 1864 
 
 1865 
 
 1866 
 
 15.37 
 
 1697 
 
 17.39 
 
 15.44 
 
 1698 
 
 1740 
 
 15.43 
 
 1699 
 
 14.94 
 
 1741 
 
 14.92 
 
 1783 
 
 14.48 
 
 1825 
 
 15.70 
 
 1867 
 
 15.57 
 
 1700 
 
 14.81 
 
 1742 
 
 14.85 
 
 1784 
 
 14.70 
 
 1826 
 
 15.76 
 
 1868 
 
 15.59 
 
 1701 
 
 15.07 
 
 1743 
 
 14.85 
 
 1785 
 
 14.92 
 
 1827 
 
 15.74 
 
 1869 
 
 15.60 
 
 1702 
 
 15.52 
 
 1744 
 
 14.87 
 
 1786 
 
 14.96 
 
 1828 
 
 15.78 
 
 1870 
 
 15.57 
 
 1703 
 
 15.17 
 
 1745 
 
 14.98 
 
 1787 
 
 14.92 
 
 1829 
 
 15.78 
 
 1871 
 
 15.57 
 
 1704 
 
 15.22 
 
 1746 
 
 15.13 
 
 1788 
 
 14.65 
 
 1830 
 
 15.82 
 
 1872 
 
 15.63 
 
 1705 
 
 15.11 
 
 1747 
 
 15.26 
 
 1789 
 
 14.75 
 
 1831 
 
 15.72 
 
 1873 
 
 15.92 
 
 1706 
 
 15.27 
 
 1748 
 
 15.11 
 
 1790 
 
 15.04 
 
 1832 
 
 15.73 
 
 1874 
 
 16.17 
 
 1707 
 
 15.44 
 
 1749 
 
 14.80 
 
 1791 
 
 15.05 
 
 1833 
 
 15.93 
 
 1875 
 
 16.59 
 
 1708 
 
 15.41 
 
 1750 
 
 14.55 
 
 1792 
 
 15.17 
 
 1834 
 
 15.73 
 
 1876 
 
 17.88 
 
 1709 
 
 15.31 
 
 1751 
 
 14.39 
 
 1793 
 
 15.00 
 
 1835 
 
 15.80 
 
 1877 
 
 17.22 
 
 1710 
 
 15.22 
 
 1752 
 
 14.54 
 
 1 1794 
 
 15.37 
 
 1836 
 
 15.72 
 
 1878 
 
 17.94 
 
 1711 
 
 15.29 
 
 1753 
 
 14.54 
 
 1795 
 
 15.55 
 
 1837 
 
 15.83 
 
 1879 
 
 18.40 
 
 1712 
 
 15.31 
 
 1754 
 
 14.48 
 
 1796 
 
 15.65 
 
 1838 
 
 15.85 
 
 1880 
 
 18.05 
 
 1713 
 
 15.24 
 
 1755 
 
 14.68 
 
 1797 
 
 15.41 
 
 1839 
 
 15.62 
 
 1881 
 
 18.16 
 
 1714 
 
 15.13 
 
 1756 
 
 14.94 
 
 1798 
 
 15.59 
 
 1840 
 
 15.62 
 
 1882 
 
 18.19 
 
 1715 
 
 15.11 
 
 1757 
 
 14.87 
 
 1799 
 
 15.74 
 
 1841 
 
 15.70 
 
 1883 
 
 18.64 
 
 1716 
 
 15.09 
 
 1758 
 
 14.85 
 
 180O 
 
 15.68 
 
 1842 
 
 15.87 
 
 1884 
 
 18.57 
 
 1717 
 
 15.13 
 
 1759 
 
 14.15 
 
 1801 
 
 15.46 
 
 1843 
 
 15.93 
 
 1885 
 
 19.41 
 
 1718 
 
 15.11 
 
 1760 
 
 14.14 
 
 1802 
 
 15.26 
 
 1844 
 
 15.85 
 
 1886 
 
 20.78 
 
 1719 
 
 15.09 
 
 1761 
 
 14.54 
 
 1803 
 
 lo.-a 
 
 1845 
 
 15.92 
 
 18s7 
 
 21.13 
 
 1720 
 
 15.04 
 
 1762 
 
 15.27 
 
 1804 
 
 15.41 
 
 1846 
 
 15.90 
 
 1888 
 
 21.99 
 
 1721. 
 
 15.05 
 
 1763 
 
 14.99 
 
 1805 
 
 15.79 
 
 1847 
 
 15.80 
 
 1889 
 
 22.09 
 
 1722 
 
 15.17 
 
 1764 
 
 14.70 
 
 1806 
 
 15.52 
 
 1848 
 
 15.85 
 
 1890 
 
 19.76 
 
 1723 
 
 15.20 
 
 1765 
 
 14.83 
 
 1807 
 
 15.43 
 
 1849 
 
 15.78 
 
 1891 
 
 20.92 
 
 1724 
 
 15.11 
 
 1766 
 
 14.80 
 
 1808 
 
 16.08 
 
 1850 
 
 15.70 
 
 1892 
 
 23.72 
 
 1725 
 
 15.11 
 
 1767 
 
 14.85 
 
 1809 
 
 15.96 
 
 1851 
 
 15.46 
 
 1893 
 
 
 1726 
 
 15.15 
 
 1768 
 
 14.80 
 
 1810 
 
 15.77 
 
 1852 
 
 15.59 
 
 June 
 
 33.34 
 
 1727 
 
 15.24 
 
 1769 
 
 14.72 
 
 1811 
 
 15.53 
 
 1853 
 
 15.33 
 
 Aug 
 
 28.75 
 
 1728 
 
 15.11 
 
 1770 
 
 14.62 
 
 1812 
 
 16.11 1 
 
 1 1864 
 
 15.33 
 
 Oct 
 
 28.25
 
 MASSACRES OF THE MOUNTAINS. 
 
 A History of ttie Indian Wars of tine 
 
 Kar West. 
 
 By JACOB PIATT DUNN. 
 
 A FEW PHESS OPINIONS. 
 
 A volume which in completeness of detail and historical 
 value, has no equal in American literature. — Keynote, New 
 York. 
 
 Of the many volumes which have been written on our 
 Indian wars, this of Mr, Dunn is entitled to rank among the 
 best, if not as the very best — Critic, New York. 
 
 A book which embodies a great deal of research, recounts 
 much straightforward history, and furnishes enough of romance, 
 tragedy, and pathos to stir by turns the reader's interest, pity, 
 and indignation. — Literary World, Boston. 
 
 The most authentic and complete narrative we possess of the 
 Indian wars. — Globe, Botton. 
 
 A credit to the author and a valuable contribution to the 
 literature of our country. — Standard, Chicago. 
 
 Full of interest. — Lutheran Observer, Philadelphia. 
 
 Should go into the district school libraries. — Press, Troy 
 {N. F.) 
 
 A volume on a broad plan — so broad as to stand by itself in 
 recent literature. We cannot suppress our high appreciation of 
 the excellence of the volume. — Post, Hartford. 
 
 Of fascinating interest and much value. — Literary Mirror, 
 Williamsiown. 
 
 The chapters on the wars of Colorado will not be disputed 
 by a single resident of the State. — Times-Republican, Denver. 
 
 An historical work of permanent interest and value. — News, 
 Indianapolis. 
 
 A book of great value to the student of American history, 
 and of permanent interest to the general reader. — Chronicle, San 
 FrancisGo. 
 
 Pvblished by HARPER ^ BROS. Profusely illustrated} 
 pp. X., 784; ^^0^ illuminated cloth; price $3J6*
 
 INDIANA. 
 
 A REDEMPTION FROM SLAVERY. 
 
 By JACOB PIATT DUNN. 
 
 A FEW PRESS OPINIONS. 
 
 " Excepting Prof. Johnston's ' Connecticut ' we may pro- 
 nounce this the most scholarly of the series. It certainly ranks 
 in the very first grade." — The Critic, New York. 
 
 " We can recommend Mr. Dunn's book as a careful and dis- 
 passionate study of a department of National history nowhere 
 else so fully analyzed." — Tribune, New York. 
 
 It is essentially a historic monograph, and a model of works 
 of its class. It is clear, strong, and convincing, showing mature 
 study and patient research. — Christian Intelligencer, Neiv York. 
 
 The volume is in every respect one of the most valuable 
 of an exceedingly valuable series. — Traveller, Boston. 
 
 His style is good, he is apt in citation of authorities, he takes 
 broad views, and he has a philosophical aim. — Beacon, Boston. 
 
 Mr. Dunn's methods are clear and logical. — Record, Phila- 
 delphia. 
 
 In writing a book on his own State, Mr. Dunn has evidently 
 taken special pride in making it as attractive as possible. For 
 years he has delved among the archives of the Indiana Histori- 
 cal Society, of which he is an ofiicer, and into the literature 
 bearing upon the early, romantic period in Indiana's history, 
 until he has been able to give to many of his pages the fascina- 
 tion of a fairy tale. — Capitol, Washington. 
 
 The story is beautifully told. Home life is represented. 
 Customs and dress and methods of labor are described. We 
 have a genuine history of the first people of that great region. — 
 Public Opinion. 
 
 At times his history is as absorbing as a novel. — Crayon 
 Bleu. 
 
 The author writes with a firm grasp on his subject, and 
 shows tho growth and development of his State in a very bril- 
 liant and spirited manner. — Chronicle, Quebec, Canada. 
 
 Published by HO VGHTON, IIIFFLIN ^ CO., in Amer- 
 ican Commonwealth series. Map, pp. viii., 4^3 ; 8vo, 
 cloth; price ^ISS.
 
 UC SOUTHFRr. RFGIU^AL LifiRAfU f'-'JL Y 
 
 AA 000 593 806 3