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A COIN CATECHISM 
 
 BY 
 
 J. K. UPTON 
 
 Assistant Secretary of the Treasury under Secretaries 
 Sherman, Windom and Folger. Financial Statis¬ 
 tician of the Eleventh Census, and Author 
 of “ Money in Politics.” 
 
 4 • 
 
 t 
 
 
 aw** “ST 
 
 CHICAGO NEW YORK 
 
 THE WERNER COMPANY 
 1895 
 
Copyright 1895 
 J. K. UPTON 
 
 A Coin Catechism 
 
 34635 
 
A COIN CATECHISM. 
 
 1. What are coins? 
 
 Pieces of metals, usually disks, 
 stamped by the government issuing 
 them for circulation as money. 
 
 2. What metals are used for this 
 
 « 
 
 purpose? 
 
 Mainly silver or gold, but each 
 metal, when- used, has with it a 
 fixed amount of a baser metal known 
 as alloy, not to depreciate its value 
 but to toughen and harden it that 
 the coins made therefrom may be 
 better adapted to circulation. 
 
 3. Why are the coins stamped? 
 To certify that they contained 
 
 when minted the weight and fine- 
 
6 
 
 A COIN CATECHISM. 
 
 ness required by law for pieces of 
 that denomination. 
 
 4. Why are they issued by the 
 government instead of by private 
 parties? 
 
 Experience has shown that only 
 in this way can a uniformity in 
 weight and design of the coin 
 be maintained—properties essential 
 to check the issue of spurious 
 pieces. 
 
 5. Are coins the only forms of 
 money? 
 
 Yes, of so-called primary mon¬ 
 ey, but bank bills, Treasury notes, 
 checks, drafts, etc., fulfill all the 
 functions of money. They repre¬ 
 sent, however, rather than possess 
 value and are only more convenient 
 and less expensive methods of effect¬ 
 ing exchanges than the metallic 
 money which they represent. 
 
A COIN CATECHISM. 
 
 7 
 
 6. What is meant by “method of 
 effecting exchanges”? 
 
 The method employed to enable 
 the possessor of a commodity he 
 does not need and is willing to part 
 with to exchange it for one that he 
 does need and is willing to accept 
 in exchange. 
 
 7. How does money do this? 
 
 In the morning you find you must 
 have a breakfast, and you go to the 
 butcher’s and get from him a beef¬ 
 steak, paying him therefor a dollar 
 of money. The butcher wants a 
 a knife and he gets one of the cutler, 
 giving him in exchange the dollar 
 you paid him for the steak. The 
 cutler needs a hat and he gets one 
 of the hatter, parting with this dol¬ 
 lar therefor, and the hatter wanting 
 some straw comes to you, a farmer, 
 and gets it, paying you therefor with 
 
8 
 
 A COIN CATECHISM. 
 
 the same dollar. Thus in effect you 
 have exchanged some straw which 
 you did not need for a steak which 
 you did need, and the dollar which 
 brought this about without inconven¬ 
 ience to you is again in your pocket 
 ready for similar duty to-morrow. 
 
 8. Could not this exchange have 
 been effected without the interven¬ 
 tion of money? 
 
 Perhaps, in the fullness of time 
 you might have found somebody 
 who had a beefsteak he was willing 
 to part with for your straw, but in 
 hunting for him you would probably 
 have lost a day’s work, become very 
 weary and probably hungry through 
 delay, but by the use of money all 
 these expensive and disagreeable 
 incidents were averted. 
 
 9. Has money any other function 
 than to facilitate exchanges? 
 
A COIN CATECHISM. 
 
 9 
 
 Incidentally it becomes a stand¬ 
 ard by which the value of all com¬ 
 modities is measured and in the 
 terms of which all values are ex¬ 
 pressed. Thus we measure the value 
 of wheat at so much money per bush¬ 
 el, lumber so much per square foot, 
 land so much per acre, all in the 
 terms of one standard, and we can 
 then easily reckon at what rate one 
 product or holding can be ex¬ 
 changed for another. 
 
 10. Is this rate uniform from 
 day to day? 
 
 No, it is continually changing. 
 
 11. Who determines this rate? 
 
 The holders of the articles to be 
 
 exchanged. 
 
 12. Then the government has 
 nothing to do with it? 
 
 Nothing whatever. It fixes the 
 weight of metal in the coin, but it 
 
10 
 
 A COIN CATECHISM. 
 
 cannot say to the holder of wheat, 
 “ You shall part with it for a certain 
 amount of such coin.” Such a 
 scheme has been tried but always 
 without the desired effect. In this 
 country nobody to-day desires that 
 the exchange rate of money for com¬ 
 modities be determined by the gov¬ 
 ernment even if such a plan were 
 possible. 
 
 13. By what is the holder guided 
 in fixing the rate ? 
 
 His necessities, mainly, but to a 
 limited extent by his judgment or 
 caprice. 
 
 14. Then if the government has 
 nothing to do with fixing the rate at 
 which products shall be exchanged, 
 what further action need it take in 
 reference to money ? 
 
 None at all. Money once estab¬ 
 lished and issued should be let alone 
 
A COIN CATECHISM. 
 
 11 
 
 if its work is to be done fairly and 
 without hindrance. 
 
 15. But the government does in¬ 
 terfere with its operations some¬ 
 times, does it not ? 
 
 Yes, frequently, but always with 
 detriment to somebody. 
 
 16. In what way does it interfere? 
 
 It steps in and says that coins 
 
 shall have an increase or decrease in 
 weight or fineness, but shall still be 
 received in payment of a debt the 
 same as the coins in existence when 
 the contract was made, and some 
 times it goes so far as to say that 
 something else entirely different 
 shall be accepted in satisfaction of a 
 debt whether the creditor is willing 
 or not. 
 
 17. Have such interferences ever 
 occurred in this country ? 
 
 Yes. In colonial days a Spanish 
 
12 
 
 A COIN CATECHISM. 
 
 silver coin known as a dollar came 
 largely into circulation. The British 
 mint ascertained and declared that 
 the piece contained the same amount 
 of silver as did 54 pence, or 4s 6d 
 of English money. Yet the Virginia 
 colony declared by law that the 
 piece contained 6 shillings. So did 
 the Massachusetts colony. The 
 New York and Maryland colonies 
 declared that the piece contained 8s; 
 Pennsylvania 7s 6d; South Carolina 
 alone declared that the piece con¬ 
 tained just what it did, 4s 6d. 
 
 18. What was the object of such 
 false declarations ? 
 
 Among the more northern col¬ 
 onies there were many loans and 
 other obligations existing calling for 
 “shillings.” By making the dollar 
 pay more debt than the weight of 
 the metal would warrant the creditor 
 
A COIN CATECHISM. 
 
 13 
 
 was deprived of the difference—in 
 New York and Maryland about 45 
 per cent of the obligation. 
 
 19. That might happen in a com¬ 
 munity imperfectly organized into a 
 government, but could it occur 
 under our constitution? 
 
 Well, in 1862 the government of 
 the United States authorized paper 
 promises in the form of notes, silent 
 as to the time of their redemption, 
 to be equal in debt-paying power to 
 the metallic money they represented, 
 though at timej the promises were 
 worth in current exchange less than 
 one-half as much as the coin itself. 
 
 20. Did the courts sanction such 
 an infringement upon private rights? 
 
 Yes, the Supreme Court of the 
 United States held that the national 
 government by its inherent power 
 of sovereignty had a right to change 
 
14 
 
 A COIN CATECHISM. 
 
 the terms of all contracts whenever 
 the law making power deemed such 
 a change necessary for the welfare 
 of the country. The law making 
 power, however, would probably hes¬ 
 itate in taking any steps of this kind 
 except the nation was in dire dis¬ 
 tress or its existence was threatened. 
 
 2i. Does such a change of stand¬ 
 ard affect prices ? 
 
 Yes. If the standard is reduced 
 prices will have a corresponding 
 rise; if increased, prices will be cor¬ 
 respondingly lower, so that in cur¬ 
 rent transactions, after prices have 
 become adjusted to the new standard, 
 there is no marked loss or gain to 
 either party to the exchange through 
 a change in the value standard. It 
 is only when the change applies to 
 contracts already existing that a 
 wrong is made possible. It is in 
 
A COIN CATECHISM. 
 
 15 
 
 making money of a new and differ¬ 
 ent standard a legal tender by law 
 for pre-existing debts that the mis¬ 
 chief chiefly occurs. If the law 
 would give no function to money 
 that it did not naturally possess in 
 the world of trade where it belongs 
 there would be no monetary evils to 
 remedy, no money question to dis¬ 
 cuss in congress or to be considered 
 in convention. 
 
 22. How much money should 
 there be in circulation ? 
 
 Just enough to meet the demands 
 of trade; no more and no less. 
 
 23. How can that amount be 
 ascertained ? 
 
 By leaving its circulation to be 
 fixed by the demand therefor just as 
 the supply of provisions, fuel or 
 clothing is determined and not by 
 arbitrary law. 
 
16 
 
 A COIN CATECHISM. 
 
 24. What is meant by cheap 
 money ? 
 
 There can be no such thing, 
 strictly speaking, as cheap money. 
 As the term is generally used it 
 means an abundance of money in 
 circulation, but that abundance de¬ 
 pends not upon the amount of money 
 available but upon the demand for 
 it that any community can create 
 by stimulating trade. It may mean 
 a low loaning rate, the abundance or 
 “plenty” of money arising, not from 
 an increase of circulation, but 
 from unemployed capital for which 
 the owner is willing to accept a 
 lower rate of interest rather than 
 have it entirely unremunerative, 
 but the amount of money in cir¬ 
 culation has little if anything to 
 do in bringing about such a con¬ 
 dition. 
 
A COIN CATECHISM. 
 
 17 
 
 25. Then simply increasing the 
 money supply does not make money 
 easy ? 
 
 Not at all. A11 accumulation of 
 wealth and a confidence in the abil¬ 
 ity of the borrower to repay his 
 loans at maturity are the principal 
 elements of an c ‘ easy ” money mar¬ 
 ket. In England, which has a per 
 capita of circulation 30 per cent less 
 than we have, the borrowing rate is 
 only \]/ 2 per cent per year, while 
 here it is double that amount; but 
 in England there is relatively a 
 greater amount of unemployed cap¬ 
 ital seeking investment, and conse¬ 
 quently interest rates are lower or 
 money cheaper. Evidently the 
 amount of circulating medium has 
 nothing to do with bringing about 
 such a condition. 
 
 26. Then legislation cannot, by 
 
18 
 
 A COIN CATECHISM. 
 
 attempting to force a circulation,con¬ 
 trol prices or make money cheaper ? 
 
 Not in the least. The forced 
 issues of our civil war, in effect, only 
 depreciated the value of the cur¬ 
 rency outstanding, so that there was 
 little increase in its aggregate value 
 measured by gold; prices were of 
 course correspondingly increased. If 
 for any reason there should be a 
 forced decrease in the amount of 
 currency, what remained of such 
 currency would, without doubt, in¬ 
 crease in purchasing power suffi¬ 
 ciently to meet the demands of trade 
 in making exchanges, prices being 
 correspondingly depressed. The 
 only thing for the law to do is to 
 leave the amount of money to the 
 demands of trade as before stated, 
 which will take care that it be suffi¬ 
 cient and never redundant. 
 
A COIN CATECHISM. 
 
 19 
 
 27. Should not the law fix the 
 weight of the standard coins ? 
 
 It should, just as it fixes the 
 weight of a bushel of wheat, and to 
 the same end that there shall be no 
 misunderstanding of the amount in¬ 
 volved between the buyer and the 
 seller. 
 
 28. Did the Colonial or Confeder¬ 
 ate Congress attempt to establish 
 any standard of value for the coun¬ 
 try ? 
 
 Only this: The Congress of the 
 Confederation, in 1785, adopted the 
 Spanish silver dollar as the ideal 
 unit of value, which piece had al¬ 
 ready been accepted as a unit in 
 nearly, if not all the colonies, and 
 the following year, declared that the 
 piece in question contained 375.64 
 grains of pure silver, and authorized 
 the coinage of the gold eagle to con- 
 
20 
 
 A COIN CATECHISM. 
 
 tain 246.268 grains of fine gold, and 
 in both cases fractional pieces of 
 proportional weight, but before a 
 mint could be put into operation 
 the Constitution was adopted and 
 no coins were issued under the act. 
 
 29. What standard of value was 
 first established under the Constitu¬ 
 tion of this country ? 
 
 The first Congress of the United 
 States provided for the coinage of 
 “silver dollars or units, each to be 
 the value of a Spanish milled dollar 
 as the same is now current, and to 
 contain 371.25 grains of pure silver,” 
 and fractional pieces of the same 
 fineness and proportional weight, 
 and gold pieces to contain 24.75 
 grains of pure gold to a dollar, all 
 of the pieces to be a full legal tender 
 in payment of debts and to be 
 coined at the mint for depositors of 
 
A COIN CATECHISM. 
 
 21 
 
 bullion of either metal free of 
 charge. Under the rates established, 
 one dollar in silver, it will be seen, 
 weighed just fifteen times more than 
 one dollar in gold, and such was the 
 ratio, 15 to 1, the law declared 
 should exist in all the coining opera¬ 
 tions of the mint. 
 
 30. Why was the ratio of 15 to 1 
 established ? 
 
 Because it was thought that in 
 the market fifteen pounds of silver 
 was worth one pound of gold, and 
 that the plan, if adopted, would se¬ 
 cure the use of both metals for cir¬ 
 culating purposes. 
 
 31. Was 15 to 1 the market rate 
 between the metals in 1792, and did 
 it continue? 
 
 It was very near it then and varied 
 a little from it for several years, but 
 the rate or difference slowly in- 
 
22 
 
 A COIN CATECHISM. 
 
 creased so that in twenty years it was 
 16 to i, but it subsequently decreased 
 somewhat, though not returning to 
 the original ratio of 15 to 1. 
 
 32. What was the effect of this 
 increase ? 
 
 No gold came to the mint for 
 coinage with a view to circulation. 
 A holder of gold bullion worth to 
 him at the mint $ 10,000 in gold 
 coin could, while on his way to that 
 institution, trade it off to bullion 
 dealers for silver enough to yield 
 him at the mint $10,200 in silver 
 coins, just as good to pay debts with 
 as the gold coin, and he naturally 
 traded his gold for silver, reaping 
 the benefit of the exchange. 
 
 33. But the reports show that 
 the mint coined considerable gold 
 under the ratio in question; why 
 was this ? 
 
A COIN CATECHISM. 
 
 23 
 
 Owners of gold bullion took it 
 to the mint to ascertain its value, 
 as it cost them nothing to have it 
 converted into coin. There were 
 no private refineries in the United 
 States prior to 1850. 
 
 34. How do you know that the 
 gold did not go into circulation ? 
 
 First, because no man pays his 
 debts in the dearer money when he 
 has the choice in two kinds for the 
 purpose. Secondly, the Director of 
 the Mint in 1833 said there was no 
 demand for gold coins only on the 
 day that some packet was ready to 
 sail for a foreign port, when the 
 coins were put aboard her for ship¬ 
 ment. Thirdly, Hon. Thomas H. 
 Benton on the floor of the Senate 
 declared in 1834 that the false valu¬ 
 ation put upon gold had rendered 
 the mint, as far as the gold coinage 
 
24 
 
 A COIN CATECHISM. 
 
 was concerned, a most ridiculous 
 and absurd institution. “It lias 
 coined,” he said, “and that at a 
 large expense to the United States, 
 2,262,717 pieces of gold worth $11,- 
 852,890, and where are these pieces 
 now? Not one of them to be seen; 
 all sold and exported.” 
 
 35. Did our silver coins furnish 
 the metallic circulation ? 
 
 To a certain extent. But in 1793 
 Congress, by law, had made the 
 Spanish dollar referred to, also its 
 eighth pieces or “reals,” full legal 
 tender in payment of debt. This 
 Spanish dollar was about 3 grains 
 heavier than our dollar and nothing 
 was to be gained by putting it into 
 circulation. A little would be 
 gained by having it coined into our 
 dollar and consequently it was de¬ 
 posited for coinage. Enterprising 
 
A COIN CATECHISM. 
 
 25 
 
 bankers also found that among the 
 unwary Spanish Americans our dol¬ 
 lars could be exchanged for the 
 Spanish pieces at par, and after the 
 exchange Spanish dollars came to 
 our mint for coinage, thus keeping 
 the mint busy at no little expense 
 to the government, but for the ex¬ 
 clusive benefit of bankers. 
 
 36. How were these operations 
 broken up? 
 
 President Jefferson, in 1806, di¬ 
 rected the suspension of the coinage 
 of silver dollars by the following 
 order, issued through the State De¬ 
 partment: 
 
 “Department of State, 
 
 May 1 , 1806 . 
 
 * ‘Sir : I11 consequence of a represen¬ 
 tation from the director of the Bank of 
 the United States, that considerable 
 purchases have been made of dollars 
 
26 
 
 A COIN CATECHISM. 
 
 coined at the mint for the purpose of 
 exporting them, and as it is probable 
 fnrther purchases and exportations 
 will be made, the President directs 
 that all the silver to be coined at the 
 mint shall be of small denomination, 
 so that the value of the largest pieces 
 shall not exceed half a dollar. I am, 
 etc., “James Madison. 
 
 “Robert Patterson, Esq., 
 
 “Director of the Mint.” 
 
 37. How many dollar pieces had 
 been coined at that time ? 
 
 Only 1,433,457. 
 
 38. Were any more of those 
 pieces coined under the ratio of 15 
 to 1 ? 
 
 There were not, the coinage of 
 this piece not being resumed until 
 1836. 
 
 39. Did the fractional silver pieces 
 continue to be coined for circula¬ 
 tion ? 
 
A COIN CATECHISM. 
 
 27 
 
 Their coinage continued, but be¬ 
 ing full weight pieces, only a small 
 portion of them ever came into cir¬ 
 culation. Those not exported were 
 largely hoarded by the banks situ¬ 
 ated at seaport towns where their 
 shipment could promptly be made 
 at any time. The report of the 
 House Committee, which investi¬ 
 gated coinage matters in 1832, states 
 that to 1830 there had been a total 
 coinage at the mint of $37,000,000, 
 of which four-fifths had been ex¬ 
 ported, leaving in circulation only 
 seven or eight millions. Most of 
 this must have been fractional silver 
 and the report of the United States 
 bank shows nearly that amount in 
 its vaults. 
 
 40. What is the plan called under 
 which a mint coins for depositors 
 all gold or silver bullion presented 
 
28 
 
 A COIN CATECHISM. 
 
 for the purpose upon like terms, but 
 at a fixed relation of weight? 
 
 Free coinage or bimetallism. ' 
 
 41. Then am I to understand that 
 under forty years of free coinage or 
 bimetallism in the United States, 
 less than $8,000,000 of coin, and 
 that mainly fractional silver, was in 
 circulation ? 
 
 That is the net result as shown by 
 the official reports. 
 
 42. Was this failure to secure a 
 coin circulation wholly due to the 
 scheme of bimetallism as established 
 in the act of 1792 ? 
 
 The establishing of a ratio of 15 
 to 1 by that act undervalued gold 
 and consequently kept that metal 
 out of circulation. Our silver coins 
 might have come into use but for 
 the legalizing of the worn out 
 Spanish pieces in 1793. Taking 
 
A COIN CATECHISM. 
 
 29 
 
 the two acts together the effort of 
 the country to provide coin for cir¬ 
 culation of any kind was a dismal 
 failure. 
 
 43. What steps if any were taken 
 by Congress to remedy this condi¬ 
 tion ? 
 
 Instead of repealing the act legal¬ 
 izing the circulation of some of the 
 foreign coins by which a supply of 
 our silver would have circulated, the 
 House, upon the recommendation of 
 a special committee, brought for¬ 
 ward the proposition to make the 
 legal ratio 15 5-8 to 1 instead of 15 
 to 1, hoping in this way to catch 
 the market rate and bring both 
 metals into circulation. But in the 
 Senate a bill, supported by the ad¬ 
 ministration, and championed by 
 Senator Benton, fixed the ratio at 
 about 16 to 1, the gold coins to be 
 
30 
 
 A COIN CATECHISM. 
 
 reduced in weight about 7 per cent, 
 and it passed with small opposition. 
 
 44. What was the market rate at 
 that period ? 
 
 About the rate fixed by the House 
 bill, 15 5-8 to 1. 
 
 45. Then if 16 to 1 should be 
 substituted would not silver be un¬ 
 dervalued and not come into circu¬ 
 lation as in the case of gold under 
 the ratio of 15 to 1 ? 
 
 Certainly, and the projectors of 
 the measure knew it. 
 
 46. What became of the Senate 
 bill? 
 
 The House adopted it in lieu of 
 its own bill and on June 28, 1834, it 
 became a law approved by Andrew 
 Jackson, President. 
 
 47. Was it the purpose of the 
 friends of this measure to thus de¬ 
 monetize silver? 
 
A COIN CATECHISM. 
 
 31 
 
 Ostensibly their purpose was to 
 get rid of the United States bank 
 with its $13,000,000 of circulating 
 notes; in that case other circulating 
 medium to take the place of the 
 bank notes must be devised and gold 
 coin seemed most available for that 
 purpose. 
 
 48. Then the change to a gold 
 basis was not especially to get rid of 
 silver ? 
 
 Probably not, but whatever the 
 purpose, silver was taken out of 
 circulation under the operation 
 of the new ratio as effectually as 
 if its further coinage had been 
 prohibited under the penalty of 
 death, and those voting for the 
 measure understood that such would 
 be the result, and when it came 
 they did not plead ignorance or 
 refer to the act as the crime of 1834. 
 
32 
 
 A COIN CATECHISM. 
 
 49. Did silver cease to be coined? 
 
 Yes, for circulation, but holders 
 
 of silver bullion still had it treated 
 at the mint to get it into good form 
 for the market just as holders of 
 
 gold bullion had done under the 
 
 • 
 
 ratio of 15 to 1 and that is why the 
 coinage of silver pieces was conti¬ 
 nued at the mint. 
 
 50. Did gold come into use under 
 the new ratio ? 
 
 Our own gold coins soon came 
 into circulation but not to the ex¬ 
 clusion of the much-berated bank 
 notes as hoped and apparently anti¬ 
 cipated. The gold coins were now 
 so much reduced in weight that even 
 some of the worn foreign silver pieces 
 were worth more in the market than 
 for circulation and only the thinnest 
 of them remained. The heavier ones 
 with our dollars, halves, quarters and 
 
A COIN CATECHISM. 
 
 33 
 
 dimes, fresh and plump from the 
 mint, left the country, which became 
 much embarrassed from lack of small 
 coins to meet the demands of trade. 
 
 51. What action if any was taken 
 by Congress to grant relief from this 
 stringency ? 
 
 In 1852 the Finance Committee 
 of the Senate, of which R. M. T. 
 Hunter was Chairman, proposed a 
 measure to that end based upon one 
 which for many years had been in 
 successful operation in England. It 
 provided that the Secretary of the 
 Treasury should purchase silver 
 bullion as needed and should coin it 
 into halves, quarters, dimes and half 
 dimes of such weight that one dol¬ 
 lar of them in value should weigh 
 384 grains of standard silver, 
 whereas their former weight was 
 412 fA grains to a dollar, a reduction 
 
34 
 
 A COIN CATECHISM. 
 
 of about 7 per cent., the new coins to 
 be issued, however, only in exchange 
 at their face value for gold coins or 
 silver dollar pieces, the weight of 
 which remained unchanged, and to 
 be a legal tender for not more than 
 $5. In this way it was thought the 
 fractional silver pieces would stay 
 in circulation, and the bill with 
 little opposition became a law Feb¬ 
 ruary 21, 1853. 
 
 52. Why would the new pieces 
 remain in circulation better than 
 those of full weight ? 
 
 Because they had been purposely 
 made light that their face value 
 should be greater than their bullion 
 value, thus preventing their melting 
 or exportation. 
 
 53. But if made of less bullion 
 value than the gold coins, dollar for 
 dollar, was there not danger that 
 
A COIN CATECHISM. 
 
 35 
 
 they would drive gold from circula¬ 
 tion as did the silver coins under 
 the ratio of 15 to i ? 
 
 No, because their coinage was not 
 made free to depositors. Only such 
 an amount was issued as could be 
 exchanged at par for the coins of a 
 higher value, and consequently the 
 issue never exceeded the demand for 
 use in making change and in petty 
 payments. Nobody would buy them 
 for exportation as bullion. Shippers 
 could do better with bullion dealers. 
 
 54. Were the results satisfactory ? 
 
 Eminently so, especially when 
 three years later the foreign silver 
 pieces were made redeemable at a rate 
 somewhat above the market value, 
 by which they disappeared from cir¬ 
 culation. The country then had 
 for the first time in its history its 
 own gold and silver coins circula- 
 
36 
 
 A COIN CATECHISM. 
 
 ting side by side, ample in amount, 
 throughout the country, neither 
 driving the other from circulation 
 or skulking because foreign coins 
 were treated better in law than 
 they were. 
 
 55. Did this act in any way affect 
 the standard of value? 
 
 Not in the least. It did not take 
 away the right to coin the silver 
 , dollar for depositors, thus retain¬ 
 ing the double standard before exist¬ 
 ing, but it did prohibit the future 
 coinage of fractional silver except 
 on government account. 
 
 56. What are pieces thus coined 
 only on government account called ? 
 
 Subsidiary coins. 
 
 57 - Tt is alleged that in 1852 
 there was in circulation a large 
 amount of foreign silver; is that 
 true ? 
 
A COIN CATECHISM. 
 
 37 
 
 No, the contrary is shown by the 
 current history of the times, the 
 memory of thousands of men now 
 living, the discussions in Congress, 
 and especially by the petition to 
 Congress of the governor and mem¬ 
 bers of the New Jersey legislature 
 in that year, as follows: 
 
 “ To the Senate and House of Represen¬ 
 tatives of the United States in Con¬ 
 gress Assembled: 
 
 “The memorial of the subscribers 
 respectfully represents, that the greatly 
 increased value of silver compared with 
 that of gold as regulated by law, at 
 the mint of the United States, has 
 almost wholly withdrawn all the silver 
 coins of proper weight from circulation 
 as a currency. They are no longer a 
 standard of value in payment, and are 
 only used as an article of commerce. 
 
 “Your honorable bodies are fully 
 aware that the ordinary business of the 
 community, comprising probably 
 
38 
 
 A COIN CATECHISM. 
 
 ninety-nine hundredths of all individ¬ 
 ual transactions, cannot be conducted 
 without small coins, or paper tokens, 
 to settle small balances; and however 
 repugnant the use of such paper trash 
 may be to the public opinion, or dis¬ 
 creditable to the government and 
 nation, the indispensable necessity for 
 it will, as your memorialists seriously 
 apprehend, soon force it upon the 
 whole country, unless Congress shall, 
 during the present session, provide an 
 efficient remedy. 
 
 “Your memorialists believe that 
 such a remedy may be found in the 
 passage of a bill that passed the Senate 
 of the United States at their last ses_ 
 sion, which proposes a silver coinage 
 about seven per cent lighter than the 
 present coin, comprising all the exist¬ 
 ing denominations less than one dollar, 
 and making these new coins a legal 
 tender only for payments not exceed¬ 
 ing five dollars.’’ 
 
 58. What was the total amount 
 and the character of money in cir¬ 
 culation in i860? 
 
A COIN CATECHISM. 
 
 39 
 
 According to an estimate of the 
 Secretary of the Treasury the 
 amount was $435,000,000, of which 
 $180,000,000 is known to have been 
 represented by bank notes, leaving 
 $255,000,000 of coin. This coin 
 was admittedly made up of our gold 
 and subsidiary coinage, of which 
 the latter was probably not above 
 $43,000,000. The estimate of ag¬ 
 gregate specie circulation and of its 
 division between gold and silver at 
 that time vary somewhat, but in no 
 case does the estimate include any 
 silver dollars as in circulation. 
 
 59. How long did the gold stand¬ 
 ard of 183.4 continue? 
 
 Practically only until 1862. Con¬ 
 gress in that year authorized the 
 issue of legal tender notes, as before 
 stated, and a dollar in that currency 
 immediately became the standard of 
 
40 
 
 A COIN CATECHISM. 
 
 value, the unit of account, and the 
 notes the basis of circulation, though 
 depreciated below their face value. 
 
 60. What became of the specie 
 circulation ? 
 
 It was mainly exported. Public 
 sentiment, however, on the Pacific 
 coast was so strong against the em¬ 
 ployment of the depreciated notes 
 that only specie continued to be 
 used in that locality, and enough 
 remained elsewhere in the country, 
 mainly in New York City, to pay 
 interest on the public debt and cus¬ 
 toms dues, both of which remained 
 payable only in coin. 
 
 61. Did even the subsidiary coins 
 disappear? 
 
 Yes; even the public treasury re¬ 
 tained of them less than $500,000, 
 their place being taken in circula¬ 
 tion by fractional notes. 
 
A COIN CATECHISM. 
 
 41 
 
 62. Why were the legal tender 
 notes issued ? 
 
 Under an alleged necessity aris¬ 
 ing from the exigencies of the Civil 
 War. 
 
 63. How long did they continue 
 as a unit of account and a basis of 
 circulation ? 
 
 Until January 1, 1879, when they 
 were brought to par in coin by their 
 redemption at sight in gold coin, 
 an event known as the resumption 
 of specie payments. 
 
 64. Then for 17 years only de¬ 
 preciated paper furnished the circu¬ 
 lation of the country ? 
 
 Yes, except, as stated, on the Pa¬ 
 cific coast and for certain payments. 
 
 65. What was the market ratio 
 of silver to gold when this resump¬ 
 tion took place in 1879? 
 
 About 18 to 1. 
 
42 
 
 A COIN CATECHISM. 
 
 66. Has it been less since ? 
 
 Very little, if any, and it is now 
 
 (1895) over 30 to 1. 
 
 67. Has gold still retained its 
 place as a standard since 1879? 
 
 It lias. 
 
 68. At such increased ratio, why 
 did not silver drive it from circula¬ 
 tion ? 
 
 Because the free coinage of that 
 metal had been prohibited by law. 
 
 69. When and how did that 
 occur ? 
 
 In 1873. Congress in that year, 
 in a revision of the mint laws, left 
 out any authority for the further 
 coinage of the silver dollar for 
 depositors, and made gold alone the 
 monetary standard, 25.8 grains f« 
 fine to a dollar. 
 
 70. Was this step taken after ma¬ 
 ture deliberation? 
 
A COIN CATECHISM. 
 
 43 
 
 It was. The bill, which dealt in 
 various matters pertaining to the 
 coinage, was originally prepared at 
 the Treasury Department, and hav¬ 
 ing been submitted to about thirty 
 gentlemen throughout the country 
 conversant with the manipulation 
 of metals, the manufacture of coin¬ 
 age and the execution of existing 
 laws relating thereto, and by them 
 thoroughly revised, it was sent to 
 Congress by Secretary Boutwell, 
 April 25, 1870. It was printed 
 thirteen times by order of Congress; 
 it was considered during five differ¬ 
 ent sessions of the Senate and 
 House, the debates thereon in the 
 Senate occupying 66 and in the 
 House 78 columns of the Congres¬ 
 sional Globe , and it was not finally 
 passed until February 12, 1873. At 
 no time did the bill contain any pro- 
 
44 
 
 A COIN CATECHISM. 
 
 vision for the free coinage of the 
 old silver dollar of 412 ^ grains, 
 or of any other silver dollar. The 
 bill as it passed the House did 
 provide for the coinage on govern¬ 
 ment account of a subsidiary silver 
 dollar to weigh 384 grains, just the 
 weight of two half dollars, and to be 
 a legal tender for $5.00. This pro¬ 
 vision was struck out in the Senate 
 upon recommendation of the Com¬ 
 mittee of Finance, and provision 
 made for the coinage for depositors 
 at their expense, of a silver dollar of 
 420 grains, to be known as a trade 
 dollar, as desired by the silver pro¬ 
 ducing states. At no time during 
 the three years the bill was under 
 consideration was any proposition 
 made or considered in Congress to 
 authorize the free coinage of a silver 
 dollar of 412^ grains. 
 
A COIN CATECHISM. 
 
 45 
 
 71. Wliat effect did this act, so 
 far as it prohibited the further coin¬ 
 age of silver for depositors, have at 
 the time upon the monetary circu¬ 
 lation of the country ? 
 
 None whatever. No coins of any 
 kind were then in general circula¬ 
 tion, and as for the silver dollar, 
 none ever had been so far as any 
 record shows to-day. 
 
 72. But has not the passage of the 
 act been termed the “Crime of 
 1873”? 
 
 It has. 
 
 73. By whom and for what pur¬ 
 pose has it been so called ? 
 
 By the advocates of free silver 
 coinage who hoped that by stigma¬ 
 tizing the act and leading the public 
 to believe that it was passed through 
 Congress surreptitiously and with¬ 
 out proper consideration they could 
 
46 
 
 A COIN CATECHISM. 
 
 create a prejudice in the public mind 
 that would lead to its repeal or mod¬ 
 ification. 
 
 74. Was any interest injured at 
 the time by making gold the stan¬ 
 dard by law as it was in fact and 
 had been since 1834, excepting, of 
 course, the period of inflated paper ? 
 
 None whatever. It made no 
 change in existing conditions then, 
 and with the market ratio of silver 
 to gold not less than 16 to 1 no 
 change would ever occur. It in no 
 way reduced the amount of “pri¬ 
 mary money ” in the country—or in 
 the world. 
 
 75. When was the alleged mis¬ 
 chief discovered ? 
 
 I11 1876, when silver had so fallen 
 in price as against gold that it was 
 the cheaper metal at the ratio of 
 16 to 1. As resumption of specie 
 
A COIN CATECHISM. 
 
 47 
 
 payments had been ordered on and 
 after January i, 1879, it was seen 
 that silver, if it had not been pro¬ 
 hibited, would again be the unit of 
 account, the dollar the principal 
 coin in circulation and gold cease to 
 be employed as a primary money, 
 as silver had been since 1834. 
 
 76. Why was this desired ? 
 
 Mainly that debtors might take 
 
 advantage of the situation and pay 
 off existing obligations, calling for 
 dollars, in coins shrunk in value 
 below the gold standard. 
 
 77. Would not this scheme vio¬ 
 late the essential elements of good 
 faith ? 
 
 Doubtless it would, but there was 
 throughout the country a numerous 
 and noisy class who had advocated 
 the payment of the interest-bearing 
 public debt in the depreciated notes 
 
48 
 
 A COIN CATECHISM. 
 
 of the government dollar for dollar, 
 with no provision for the redemp¬ 
 tion of the notes, and this class, de¬ 
 feated at the polls, was only too glad 
 for a plausible opportunity to advo¬ 
 cate any scheme which savored of 
 repudiation, public or private. 
 
 78. In what section of the coun¬ 
 try did the advocates of silver find 
 most adherents ? 
 
 Naturally in the silver-producing 
 states where the voters could be 
 made to believe that the legislation 
 had been adverse to their local in¬ 
 terests, but in other sections many 
 joined in the advocacy of a restora¬ 
 tion of free silver, who were restless 
 and dissatisfied with their party 
 affiliations and were looking for an 
 excuse for leaving their old party. 
 
 79. As silver dollars were being 
 coined for exportation at the time 
 
A COIN CATECHISM. 
 
 49 
 
 of the passage of the act, did not the 
 silver-producing states have some 
 cause of complaint in being debarred 
 from this privilege in the future ? 
 
 The right of an owner to have his 
 silver bullion treated at the mint so 
 as to be put in merchantable form 
 free of expense to him, was not con¬ 
 templated in any coinage act. Fur¬ 
 thermore, the fact that any man or 
 any class of men had enjoyed for a 
 long period a lucrative privilege 
 never intended to be granted, by 
 which great gain had arisen at the 
 expense of the Government, i. e ., of 
 other fellow-citizens, affords no just 
 claim for its continuance. 
 
 80. Was not the authority for 
 coinage of trade dollars favorable* to 
 the silver producers ? 
 
 It was. Under it the mint was au¬ 
 thorized to receive deposits of silver 
 
50 
 
 A COIN CATECHISM. 
 
 bullion, to part and refine and coin 
 them, but to coin only in so-called 
 “trade dollars” containing 420 
 grains of silver 9-10 fine instead of 
 412^ as in the old dollar, the depos¬ 
 itors to pay the expenses, and this 
 was all the silver states asked for. 
 
 81. In what way was the manu¬ 
 facture of these coins any advan¬ 
 tage to the silver producer ? 
 
 It enabled him at a slight charge 
 to have his bullion assayed and 
 stamped by the government setting 
 forth its weight and fineness, and 
 purchasers would accept the bullion 
 thus stamped without question, thus 
 giving it an advantage over the 
 
 other forms of bullion. 
 
 * 
 
 82. What became of these dol¬ 
 lars ? 
 
 They were mainly exported as 
 intended. 
 
A COIN CATECHISM. 
 
 51 
 
 83. How many were coined ? 
 
 3S.965>924 pieces. 
 
 84. When did their coinage stop ? 
 
 Practically in 1879. 
 
 85. Why was not their fabrica¬ 
 tion continued if at no expense to 
 the government ? 
 
 The unexpected depreciation in 
 the price of silver bullion rendered 
 the value of the piece less than a 
 dollar in gold and depositors took 
 advantage of this condition to place 
 the dollars in circulation instead of 
 exporting them. Consequently the 
 Secretary of the Treasury stopped 
 their coinage as he was authorized 
 by law to do. 
 
 86. How many standard silver 
 dollars had been coined for deposi¬ 
 tors previous to 1873? 
 
 Only 8,031,238. 
 
 87. Then under one of the provi- 
 
52 
 
 A COIN CATECHISM. 
 
 sions of the demonetization act of 
 1873, more than four times the 
 amount of trade dollars was coined 
 for depositors in six years than had 
 been coined of standard dollars in 
 the 80 years previous under the free 
 coinage acts of 1792 and 1834? 
 
 Yes, and that of itself should dis¬ 
 prove any charge of intentional ill- 
 treatment of the silver-producing 
 states. These states asked for the 
 trade dollar in lieu of the standard 
 dollar; they got it, and but for un¬ 
 foreseen conditions would have had 
 it to-day. 
 
 88. Did they continue to ask for 
 a restoration of the free coinage of 
 silver after the coinage of trade 
 dollars was prohibited ? 
 
 They did, but the price of silver 
 had so greatly depreciated that their 
 demand was not answered. 
 
A COIN CATECHISM. 
 
 53 
 
 89. But the standard silver dollar 
 is now in circulation; how has its 
 coinage been brought about ? 
 
 By an act passed February 28, 
 1878, over a veto of the President, 
 the Secretary of the Treasury was 
 authorized and directed to purchase 
 not less than two million nor more 
 than four million dollars worth of 
 silver per month and to coin it into 
 silver dollars of the fineness and 
 weight of those coined previous to 
 
 1873- 
 
 90. Then silver dollars coined 
 since 1878 are practically only sub¬ 
 sidiary coins ? 
 
 To a certain extent yes, but their 
 issue was compulsory and they 
 were of full legal tender, and certifi¬ 
 cates for their deposit were also to 
 be issued which the government 
 would accept in payment of any 
 
54 
 
 A COIN CATECHISM. 
 
 dues, by which they readily passed 
 as money, qualities not given to sub¬ 
 sidiary coins. 
 
 91. Were the silver dollars them¬ 
 selves generally acceptable to the 
 public ? 
 
 They were not. Of the two, the 
 certificates were preferred. 
 
 92. In what were the certificates 
 
 redeemable ? * 
 
 In silver dollars only. The cer¬ 
 tificate reads: “This certifies that 
 there has been deposited in the 
 
 Treasury of the United States - 
 
 silver dollars payable to bearer on 
 demand,” but under an act passed 
 July 14, 1890, the Treasury redeems 
 them in gold. 
 
 93. What were the provisions of 
 this act ? 
 
 The Treasury was directed to 
 purchase every month $4,500,000 
 
A COIN CATECHISM. 
 
 55 
 
 fine ounces of silver, paying for it in 
 “notes” which notes were made a 
 legal tender for all debts public and 
 private unless otherwise specifically 
 stated in the contract, and were re¬ 
 deemable in either gold or silver at 
 the discretion of the Secretary of 
 the Treasury, Congress declaring it 
 “ the established policy of the 
 United States to maintain the two 
 metals on a parity with each other 
 upon the present legal ratio, or such 
 ratio as may be provided by law.” 
 So much of the act of 1878 as re¬ 
 quired the purchase of silver and 
 coining it into dollars was repealed. 
 
 94. Is this act still in force ? 
 
 Its silver-purchasing provisions 
 were repealed in 1893. 
 
 95. What amount of silver certifi¬ 
 cates, Treasury notes and silver 
 coin issued under these two acts is 
 
56 
 
 A COIN CATECHISM. 
 
 now (1895) outstanding and outside 
 of the Treasury ? 
 
 Of silver coin $52,812,570, of 
 silver certificates $312,553,171, and 
 of Treasury notes $117,954,807, a 
 total of $492,320,548. 
 
 96. How much gold is in circula¬ 
 tion outside of the Treasury ? 
 
 Only $483,770,430. 
 
 97. How much silver was pur¬ 
 chased under the two acts and at 
 what rate ? 
 
 The amount will be shown by the 
 following table: 
 
 Act Authoriz¬ 
 ing. 
 
 Fine Ounces. 
 
 Cost. 
 
 Average 
 Cost 
 Per Oz. 
 
 Feb. 28, 1878 
 July 14, 1890 
 
 291,272,019 
 
 168,674,682 
 
 $308,299,261 
 
 155,931,002 
 
 $1,058 
 
 .924 
 
 1 Otcil 1 * •••<> 
 
 459,946.701 
 
 464,230,263 
 
 1.009 
 
 98. Then under the operation of 
 the two acts more silver is in cir¬ 
 culation than gold? 
 
A COIN CATECHISM. 
 
 57 
 
 Yes, considerably more, not in¬ 
 cluding $60,000,000 of subsidiary 
 silver. 
 
 99. And all this silver is redeem¬ 
 able in gold? 
 
 Yes, at the demand of the holder, 
 otherwise the “parity” of the two 
 metals would not be maintained as 
 required by law. 
 
 100. What reserve has the law 
 provided from which to meet these 
 redemptions? 
 
 None at all. 
 
 101. Is no silver ever presented 
 for redemption ? 
 
 Yes, millions of it, and it is re¬ 
 deemed, too. 
 
 102. Where does the Treasury get 
 its gold for this purpose? 
 
 It takes gold from the fund of 
 $100,000,000 accumulated by the 
 sale of bonds in 1878 to meet the 
 
58 
 
 A COIN CATECHISM. 
 
 redemption of United States notes 
 on and after January i, 1879. 
 
 103. What, then, are the total 
 obligations against this fund ? 
 
 Of silver as above stated $492,- 
 320,548, and of United'States notes 
 $346,681,016, a total of $839,001,- 
 564, and in addition to that the fund 
 is held liable to be used in current dis¬ 
 bursements to an unlimited amount 
 and it has been so used whenever 
 necessary. 
 
 104. Is not this a small reserve 
 for so many obligations ? 
 
 It is and it would be utterly in¬ 
 adequate, but that it can be re¬ 
 plenished at any time by the further 
 sale of bonds for gold. 
 
 105. Have any bonds been sold 
 for this purpose since 1879? 
 
 Yes, about $162,000,000 of 5 and 
 4 per cent, bonds. 
 
A COIN CATECHISM. 
 
 59 
 
 106. If the income of the gov¬ 
 ernment should equal or exceed its 
 expenditures would not that remove 
 an important liability against this 
 reserve ? 
 
 It would, and probably allay any 
 
 ¥ 
 
 apprehension of the ability of the 
 government to maintain the parity 
 in value between the two metals as 
 required by law. 
 
 107. Then is it true that since 
 the alleged demonetization of silver, 
 nearly $500,000,000 of it has been 
 put into circulation and maintained 
 there at a parity of value with 
 gold ? 
 
 It is, and it is generally admitted 
 that the plan adopted is the only 
 one feasible by which the two metals 
 can be made to circulate together. 
 
 108. If nearly 500,000,000 of 
 silver dollars has been put into cir- 
 
60 
 
 A COIN CATECHISM. 
 
 dilation within 17 years under a 
 restricted coinage and maintained 
 there as stated, against a total specie 
 circulation of less than $8,000,000 of 
 our own coins after 60 years under 
 free coinage, has not the plan of 
 restricted coinage been more to the 
 interest of producers of silver than 
 was the free coinage system? 
 
 It would seem so from the results 
 shown. 
 
 109. Should free coinage at the 
 ratio of 16 to 1 be re-established 
 what would become of the gold in 
 circulation ? 
 
 Doubtless it would be mainly ex¬ 
 ported. 
 
 no. In return for what ? 
 
 Public and corporation securities 
 of which there is an estimated 
 amount held abroad of more than 
 $2,000,000,000. 
 
A COIN CATECHISM. 
 
 61 
 
 hi. Why will they be returned? 
 
 Because the holders, knowing 
 that the obligations, when due, will 
 be paid in silver, will dispose of 
 them immediately at best rates ob¬ 
 tainable in gold. 
 
 112. With our $484,000,000 of 
 gold taken from the circulation, by 
 what will it be replaced ? 
 
 Probably in time by silver, but as 
 the average price of that metal in 
 gold for 1894 was somewhat less 
 than 50 cents for a dollar there will 
 be needed for silver double the 
 amount of silver dollars there was 
 of gold coin to equalize the value, 
 or, say $968,000,000 of silver. 
 
 113. How long would it take the 
 mints of the United States working 
 at their full capacity, to coin that 
 amount ? 
 
 As the maximum capacity of the 
 
62 
 
 A COIN CATECHISM. 
 
 mints is only about $45,000,000 per 
 annum (in silver dollars) it would 
 take a little more than 20 years. 
 
 114. Would not a change to a 
 silver basis then at a ratio of 16 to 
 1 cause a violent reduction in the 
 outstanding circulation of money in 
 the country? 
 
 It would ; not only must the 
 vacuum caused by the disappearance 
 of gold be supplied, but there is at 
 present about $750,000,000 of notes 
 circulating at a gold valuation; 
 these if redeemable only in silver 
 would at once lose one-half of their 
 present purchasing power, requiring 
 an increase of like amount in face 
 value to keep the value of our cir¬ 
 culation unimpaired. 
 
 115. And to put silver coins in 
 their place would require seven or 
 eight years perhaps ? 
 
A COIN CATECHISM. 
 
 63 
 
 Yes; perhaps, however, the capa¬ 
 city of the mint might be increased 
 or notes be issued upon silver bul¬ 
 lion, but at best there would be 
 for awhile a sudden contraction of 
 the currency, disturbing business, 
 checking prosperity, throwing thou¬ 
 sands out of employment, thus pro¬ 
 voking disturbance the end of which 
 no one can forsee. 
 
 116. But would not owners of 
 silver mines reap a profit from an 
 enhanced price of silver consequent 
 upon the new demand of that metal 
 for circulation ? 
 
 They doubtless expect to,- and 
 until the channels of circulation are 
 supplied as needed, and prices shall 
 have become adjusted to the new 
 standard, they would probably reap 
 some advantage, but it must be re¬ 
 membered that no increase of wealth 
 
64 
 
 A COIN CATECHISM. 
 
 in the aggregate can accrue from 
 such a source. What the owners of 
 silver mines gain in the confusion, 
 others must lose. 
 
 117. Will not foreign exchanges 
 continue to be made in terms of 
 gold? 
 
 They will, and the result will be 
 the re-establishment at New York 
 of a Gold Board. 
 
 118. What necessity for that? 
 
 Because exchanges are effected in 
 
 this way: A Liverpool cotton mer¬ 
 chant telegraphs a New York Com¬ 
 mission House: “If you can buy one 
 thousand bales of midland cotton so 
 as not to cost me more than 15 cents 
 gold per pound laid down in Liver¬ 
 pool, you may do so.” The coinmis- 
 „ sion merchant finds foreign insur¬ 
 ance and other charges will be about 
 2 cents. He wants 1 cent profit and 
 
A COIN CATECHISM. 
 
 65 
 
 can therefore afford to give 12 cents 
 gold for the cotton itself. He goes 
 into the cotton market and learns 
 that cotton is quoted only in silver; 
 that the planters of the south pay 
 their laborers and buy their provi¬ 
 sions and agricultural implements 
 in silver and they cannot tell what 
 their cotton is worth in gold. In 
 silver cotton can be bought for 24 
 cents a pound, and the next inquiry 
 is to ascertain the price of silver so 
 as to know how much in that metal 
 he can afford to pay for the cotton 
 that he may fill the order of his 
 Liverpool correspondent as desired. 
 He finds gold selling at a premium 
 in silver of 100 per cent, in other 
 words a dollar in gold is worth $2 in 
 silver. At this rate he can fill the 
 order, twelve cents in gold being 
 equivalent to 24 cents in silver. 
 
66 
 
 A COIN CATECHISM. 
 
 Thus far the transaction is simple 
 enough. He has only to exchange 
 his gold for silver and pay for his 
 cotton. But the Liverpool merchant 
 has not sent the gold. It will be 
 several days before the cotton will 
 be ready for shipment and not until 
 it is aboard the vessel can he receive 
 an advance upon it. Meanwhile 
 the rate of silver may vary ad¬ 
 versely to him perhaps wiping out 
 his profits or even incurring for him 
 . a new liability. This is a risk he 
 does not wish to take, but it will be 
 taken at the Gold Board, the mem¬ 
 bers of which make it a business to 
 gamble in the price of gold measured 
 by silver. He goes there and finds 
 that he can contract for the delivery 
 of the gold in silver, one for two, for 
 a commission of % of one per cent 
 in addition to the ordinary exchange 
 
A COIN CATECHISM. 
 
 67 
 
 rate, any time within 30 days. This 
 commission he cannot afford to pay 
 so he resumes negotiations with the 
 cotton broker and finally gets him 
 to consent to accept for his cotton 
 that per cent less. He will then 
 have no further trouble in consum¬ 
 mating the transaction. But the 
 fact that the New York standard 
 was different from that of Liverpool 
 compelled the producer of cotton to 
 suffer a loss of % of one per cent to 
 guarantee the gold broker against a 
 depreciation within 30 days of the 
 price of silver. 
 
 119. Would this commission 
 amount to any considerable sum ? 
 
 The total value of our exports 
 for 1894 was $892,140,572, and % 
 of one per cent of this amount 
 would be $2,230,351, which amount 
 would be paid to New York brokers 
 
68 
 
 A COIN CATECHISM. 
 
 by our producers of goods for ex¬ 
 portation. 
 
 120. But if meanwhile the price 
 of silver should be enhanced would 
 not the New York broker make a 
 profit to the extent of the increase ? 
 
 He would, and that is what he 
 calculates upon. He charges the 
 percentage to guard against possible 
 loss; he takes for himself all possible 
 gain, for the New York broker has 
 an unearned reputation for money 
 making if in such a deluge of larks 
 his dish is found bottom side up. 
 
 121. You assume then that with 
 free coinage of silver, under present 
 conditions, cotton would advance in 
 price from 12 cents per pound as in 
 1890 to 24 cents ? 
 
 Yes, there can be no doubt that 
 such would be the relative advance. 
 
 122. Is not this just what the ad- 
 
A COIN CATECHISM. 
 
 69 
 
 vocates of free silver claim would 
 result ? 
 
 Yes, but they maintain, or at 
 least some of them do, that silver 
 will circulate with gold at par 
 under the coinage ratio of 16 to i. 
 Should such be the result there 
 would be no special objection to the 
 free coinage desired, but no such 
 result is possible, as I have already 
 shown and as is now generally ad¬ 
 mitted, and without it the apparent 
 increase in value would be fictitious. 
 
 123. But is not cotton at 24 cents 
 better for the producers than cotton 
 at 12 cents per pound? 
 
 Not necessarily. If a farmer sells 
 his wheat for francs, five of them to 
 a dollar, he will get five times as 
 many pieces for it as he would if 
 paid in dollars, but he gets no more 
 in value, and 24 cent cotton in sil- 
 
70 
 
 A COIN CATECHISM. 
 
 ver is not necessarily one wliit bet¬ 
 ter for the producer than 12 cent 
 cotton in gold. The only way the 
 producer can get an increase for his 
 cotton is to have an advance in the 
 price without a decrease of standard; 
 then he secures an actual advance. 
 
 124. But it is alleged that under 
 a gold standard the prices of com¬ 
 modities have depreciated greatly 
 to the injury of producers and that 
 the restoration of free silver with its 
 increase of prices would be only just 
 to that class. Is such the case? 
 
 In the matter of depreciation of 
 prices of course we might in any 
 event naturally look for a lowering 
 in those of agricultural products, 
 
 owing to greatly improved methods 
 
 * 
 
 and machinery employed. The 
 investigation of the nth census 
 shows that in preparing ground for 
 
A COIN CATECHISM. 
 
 71 
 
 cereals one man through new de¬ 
 vices can do the former work of 
 two and in gathering the crops one 
 can do the work of nine. This of 
 itself would naturally insure a reduc¬ 
 tion in prices of farm products. Gold 
 came to be employed as a standard 
 in 1834. It took a few years before 
 its coins furnished the circula¬ 
 tion of the country, but under its 
 employment prices of farm products 
 have increased, not diminished, as 
 will be seen by the following table, 
 which shows the prices of the prin¬ 
 cipal agricultural products for 1840 
 and at the end of each succeeding 
 decade, omitting 1870 when prices 
 were inflated by the civil war and 
 a depreciated currency. 
 
 The figures of the following table 
 have been taken from a report of 
 the Senate Finance Committee on 
 
72 
 
 a COIN CATECHISM. 
 
 § 
 
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 00 
 
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 CO 
 
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 co 
 
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 LO 
 
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 CD 
 
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 Li 
 
 ft 
 
 C/J 
 
 CM 
 
 6 
 
 £ 
 
 03 
 
 CD 
 
 X 
 
A COIN CATECHISM. 
 
 73 
 
 Wholesale Prices and Wages, 1893, 
 and their accuracy has never been 
 questioned. It will be seen that 
 notwithstanding the introduction of 
 labor-saving appliances there has 
 been an increase in the price of all 
 the principal farm products during 
 the 50 years in question and yet all 
 this time the country was on a gold 
 basis, and the products were in 
 every case measured by gold. 
 Wheat, whose recent depreciation 
 in value has been attributed to the 
 fall in silver, was worth nearly three 
 times as much per bushel in 1890 
 as it was in 1840, and nearly double 
 what it was in 1850, measured by 
 eold. There is no truth in the alle- 
 gation that prices of farm products 
 have been depreciated under the 
 employment of a gold standard. 
 
 125. What change, if any, has 
 
74 
 
 A COIN CATECHISM. 
 
 taken place in the price of manu¬ 
 factured articles during the same 
 period ? 
 
 Prices of such articles have de¬ 
 creased as everybody desired, ren¬ 
 dering the cost of living much less 
 in 1890 than it was in 1840. They 
 are shown in the same report for 
 each year since 1840, also the rela¬ 
 tive average of prices, i860 being 
 reckoned as 100. The figures of 
 such averages shown below are for 
 the same dates as those in previous 
 table: 
 
 Class 
 
 1840 
 
 1850 
 
 1860 
 
 1880 
 
 1891 
 
 Cloths and clothing. 
 
 $111 
 
 $91 
 
 $100 
 
 $91 
 
 $81 
 
 Fuel and lighting. 
 
 396 
 
 103 
 
 100 
 
 100 
 
 91 
 
 Metals and implements. 
 
 124 
 
 115 
 
 100 
 
 96 
 
 74 
 
 Drugs and chemicals. 
 
 146 
 
 124 
 
 100 
 
 113 
 
 86 
 
 House furnishing goods. 
 
 116 
 
 126 
 
 100 
 
 85 
 
 70 
 
 Miscellaneous. 
 
 147 
 
 107 
 
 100 
 
 109 
 
 95 
 
 It will be seen that the wage- 
 earner, for whose welfare the free 
 silver advocates are so solicitous, 
 
A COIN CATECHISM. 
 
 pays 28 per cent less for his cloths 
 and clothing; 80 per cent less for 
 his fuel and lighting; 40 per cent 
 less for metals and implements; 42 
 per cent less for drugs and chemi¬ 
 cals; 40 per cent less for house fur¬ 
 nishing goods, and 35 per cent less 
 for miscellaneous items in 1891 than 
 he paid in 1840. 
 
 126. Does not labor enter very 
 largely as an element of cost into 
 
 f 
 
 each manufactured article ? 
 
 Yes, the cost of labor constitutes 
 nearly one-third of the value of 
 manufactured products. 
 
 127. Then if these products have 
 been so reduced in price has their 
 reduction not been at the expense of 
 the wage-earner—has not his wages 
 been reduced? 
 
 O, no; on the contrary they have 
 greatly advanced. The report in 
 
76 
 
 A COIN CATECHISM. 
 
 question shows 61 series of wage 
 returns, beginning as early as 1840, 
 and 540 series from i860 to 1891. 
 These extended back to 1840 are 
 mostly of New York or Boston 
 firms. Below are given a few 
 
 Occupations. 
 
 Building Trades — 
 
 Plasterers. 
 
 Roofers and slaters. 
 
 Blacksmiths.. 
 
 Blacksmiths’ helpers. 
 
 Painters. 
 
 Wheelwrights. 
 
 Cotton Goods— 
 
 Card grinders. 
 
 Card Strippers.,. 
 
 Carpenters. 
 
 Drawing hands.. 
 
 Engineers. 
 
 Firemen. 
 
 Laborers.. 
 
 Machinists. 
 
 Overseers. 
 
 Watchmen. 
 
 Railroads— 
 
 Baggagemen. 
 
 Brakemen, freight. 
 
 Brakemen, passenger. 
 
 Carpenters. 
 
 Conductors, freight. 
 
 Conductors, passenger. 
 
 Engineers, locomotive. 
 
 Firemen, locomotive. 
 
 Foremen, masons. 
 
 Painters. 
 
 Average, according to im¬ 
 portance for all occupa¬ 
 tions—1860 being reck¬ 
 oned as 100. 
 
 1840 
 
 1850 
 
 I860 
 
 1G80 
 
 1S90 
 
 $1.50 
 
 $1.75 
 
 $1 
 
 75 
 
 $2.00 
 
 13.50 
 
 1.50 
 
 1.50 
 
 1 
 
 .25 
 
 2.50 
 
 3.50 
 
 1 50 
 
 1.50 
 
 1 
 
 .50 
 
 3 00 
 
 3.00 
 
 0.83 
 
 .83 
 
 
 .83 
 
 1.75 
 
 1 75 
 
 1.25 
 
 1.25 
 
 1 
 
 .25 
 
 1.75 
 
 2.50 
 
 1.25 
 
 1.25 
 
 1 
 
 25 
 
 2..50 
 
 2.50 
 
 .80 
 
 .92 
 
 
 .92 
 
 1.52 
 
 1 52 
 
 .50 
 
 .79 
 
 
 75 
 
 .93 
 
 1 02 
 
 1 29 
 
 1.41 
 
 1 
 
 .52 
 
 1.81 
 
 1 94 
 
 .41 
 
 .45 
 
 
 .50 
 
 .67 
 
 1.04 
 
 2.00 
 
 2.25 
 
 3 
 
 00 
 
 3.50 
 
 4.25 
 
 1.25 
 
 1.37 
 
 1 
 
 .44 
 
 1 40 
 
 1.65 
 
 .81 
 
 1.04 
 
 
 .99 
 
 1.16 
 
 1.25 
 
 1.45 
 
 1 55 
 
 1 
 
 .76 
 
 2 08 
 
 2.19 
 
 2.00 
 
 2.00 
 
 O 
 
 & 
 
 .25 
 
 3 00 
 
 5 00 
 
 1.10 
 
 1.06 
 
 1 
 
 .00 
 
 1.50 
 
 1.55 
 
 1.53 
 
 1 53 
 
 1 
 
 91 
 
 2.10 
 
 2.11 
 
 1.00 
 
 1.00 
 
 1 
 
 .16 
 
 1.75 
 
 1.85 
 
 1 15 
 
 1.15 
 
 1 
 
 25 
 
 2.00 
 
 2.00 
 
 1.22 
 
 1.33 
 
 1 
 
 .30 
 
 1.77 
 
 2 00 
 
 1.66 
 
 1.68 
 
 1 
 
 .61 
 
 2.58 
 
 2.57 
 
 2 11 
 
 2.30 
 
 3 
 
 .19 
 
 3.45 
 
 3 81 
 
 2.14 
 
 2.15 
 
 2 
 
 .30 
 
 3.78 
 
 3 79 
 
 1.06 
 
 1.15 
 
 2 
 
 00 
 
 2.00 
 
 2.00 
 
 2.50 
 
 2.50 
 
 2 
 
 .50 
 
 4.00 
 
 4 10 
 
 1.5 u 
 
 1.42 
 
 1 
 
 .42 
 
 1.87 
 
 2.17 
 
 87.7 
 
 92.7 
 
 100. 
 
 143. 
 
 168 6 
 
A COIN CATECHISM. 
 
 ( i 
 
 samples atid the general results. 
 The figures are per diem rates for 
 every tenth year, beginning with 
 1840, except for 1870, which are 
 omitted for reasons before stated. 
 
 Commenting upon this result the 
 committee says: “The advance in 
 daily wages which has been here 
 noted, has been accompanied by a 
 decrease in the hours of labor. Com¬ 
 pared with 1840, hourly wages in 
 1891 stood at 209.0 and compared 
 with i860 at 176.8.” 
 
 In other words the average wages 
 of all occupations have more than 
 doubled since 1840 and have in¬ 
 creased 76.8 per cent since i860, 
 and that without any change from 
 the gold standard. 
 
 128. But it is alleged that re¬ 
 cently, say since 1873, there has 
 been a great increase of debt in the 
 
V 
 
 78 A COIN CATECHISM. 
 
 United States thus involving the 
 wealth of the country to the advan¬ 
 tage of the creditor class; is that true? 
 
 There is no record of debts exist- 
 
 * 
 
 ing in the country previous to 1890 
 
 * 
 
 except those incurred by the Na¬ 
 tional, State and local governments. 
 The total and per capita at the end 
 of the three last decades were as fol¬ 
 lows: 
 
 Year. 
 
 Total. 
 
 Per Capita. 
 
 1870 
 
 $3,379,253,997 
 
 92.80 
 
 1880 
 
 3,045,796,011 
 
 60.73 
 
 1890 
 
 2,027,170,546 
 
 32.37 
 
 Instead of an increase in these 
 debts, there has been such a de¬ 
 crease that the per capita burden in 
 1890 was only about one-third as 
 great as in 1870. 
 
 , 129. It is also alleged that owing 
 to a lack of circulation arising 
 
A COIN CATECHISM 
 
 79 
 
 8 
 
 00 
 
 OicrsiO'^'iMoocrscOr-tcor^oco 
 
 NOtO(M<N<DOi>OO^COCOCO 
 
 INMHOHrfoO^OOiOOO'l' 
 
 co~ of i—T of bToV io' h r-T 
 
 i-t ۩= CO H CD m 
 
 m ^ 
 
 o 
 
 00 
 
 NOON^C&N^HNlNOOS 
 
 OJCuONOiOONiOiM^WH 
 
 HiOHNN^^I>HCOCOOOOO 
 
 o'i-T i-T •o'co~ co ^ ^ 
 
 T-( ۩: CO ^ ^ 
 
 m rH 
 
 1860. 
 
 ODODOOCONNCOXO^OO 
 
 'tOOCOOCOI>b-C»(»'^iOr-lTjC 
 COO 'CCOOHHCOOHHIOh 
 ~ n ^ f/A f/A 
 
 CO i-H IOOHCO 
 
 & & HHH 
 
 rH & 
 
 
 « 
 
 (M^CQCO(MONOOON^COCO 
 
 o 
 
 NTfiiOHOO^COCOOSCOO^ 
 
 »o 
 
 <M >0 COlOrlHTtcC«I>HCO^ 
 
 GO 
 
 y—i 
 
 co ^ of co^tC^ 
 
 
 £/> HCO# 
 
 a 
 
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 • rH 
 H-» 
 
 a 
 
 'd 
 
 o 
 
 Ih 
 
 »H 
 
 o 
 
 cti 
 
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 < 4 H 
 
 O 
 
 Vh 
 
 V 
 
 H-* 
 
 u 
 
 Cd 
 
 u 
 
 cd 
 
 rd 
 
 u 
 
 c/5 
 
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 2 cn 
 
 2 S 
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 LJ *f-H 
 
 S.S. 
 
 ai 
 
 tj cJ 
 
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 I- 1 -M 
 
 M m 
 
 S <u 
 
 £ > 
 
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 Cm Cm 
 
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 *rf ’a} 
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 a> ^=; n 
 
 1 dn’P o 
 ago 
 
 cn 
 
 a 
 
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 nd 
 
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 cn 
 
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 cn 
 
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 cn •r-i 
 
 P § 
 
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 ojid 
 
 g p p 
 
 £ P> 
 
 Cm Cm 
 
 O O o 
 cn cn w 
 r d T 53 
 
 2 2^ 
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 OOP 
 
 ^ pu w 
 
 P 
 
 CU 
 
 Pi 
 
 £ 
 
 Cm 
 
 O 
 
 cn 
 
 4-> 
 
 P 
 
 O 
 
 Cm 
 
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 cn cn 
 
 “ 13 
 
 Pi 
 cn 
 P 
 
 M 
 
 a 
 
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 -<-> 
 
 -4-» 
 
 o 
 
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 Cm 
 
 O 
 
 cn 
 
 <U 
 
 fH 
 
 P 
 
 CQ 
 
 >% g 
 -C-* P 
 
 ti o 
 <U • M 
 
 PI ^ P^Pl 
 d >io-h 
 tj £ p 
 g <u Ph3 
 
 — ^ cn 
 ^“1 2 
 
 Q {P|Cm 2 
 
 ■gls ©.g 
 
 ccJ •£ P P tn 
 
 « o be 
 2 ft o’£ p 
 
 2 _p m ^ *P 
 
 £ en a P > 
 
 +-V.M Oh Co 
 
 }h »t-H cd ^ 
 
 » d 
 
 O- 
 
 u cu^ oj cn 
 
 P w ° 
 
 P cn +j ^ Pc 
 O P O <U 
 
 HWHAcfl 
 
80 
 
 A COIN CATKCHISM. 
 
 from the demonetization of silver, 
 the prosperity of the country has 
 been checked. What do the figures 
 show ? 
 
 The foregoing table will show 
 you at a glance the wealth and pro¬ 
 duction of the United States for 
 each decade since 1850 (1870 ex¬ 
 cepted as before) as published by 
 the United States Census office, and 
 the amount of savings banks de- 
 
 0 
 
 posits as shown by the Report of 
 the Comptroller of the Currency, 
 at same dates. 
 
 It will be seen that production 
 and valuation have increased with 
 every decade since 1840, the per 
 capita of wealth being more than 
 three times greater in 1890 than in 
 1840. 
 
 130. In what way is this increase 
 of wages, decrease in cost of living 
 and greatly increased wealth shown? 
 
A COIN CATECHISM. 
 
 81 
 
 It is seen in the piano, the carpet 
 and the silk dress which have come 
 to the homes of the farmer and 
 wage-earner; in the increase of 
 books, pictures and tidy surround¬ 
 ings of every home; in the cheap¬ 
 ened transportation, by which farm 
 products are brought to markets 
 thousands of miles distant at rates 
 less than from an adjoining county 
 fifty years ago; in the increased fa¬ 
 cilities for personal travel, by which 
 rates and time have been reduced 
 two-thirds and the comfort of a par¬ 
 lor substituted for a seat in a spring¬ 
 less wagon over a rough road; in 
 the reduced hours of labor, by which 
 the wage-earner can spend with his 
 family or in rest more than one- 
 third of the time he was formerly 
 employed in the factory or field, 
 and yet have 75 per cent more 
 money to spend on comforts or lux- 
 
82 
 
 A COIN CATECHISM. 
 
 uries which fifty years ago were 
 known only to the wealthy; in the 
 facilities for the education of chil¬ 
 dren, public schools for which pur¬ 
 pose of the highest order being now 
 within reach of every child in the 
 country of whatever color or condi¬ 
 tion; in the better and more abun¬ 
 dant food; in the removal of many 
 of the burdens which made life two 
 generations ago heavy and hard to 
 endure. Whatever may be the 
 cause, there is no mistaking the re¬ 
 sult—the condition of the masses of 
 our people has greatly improved 
 within the last fifty years. 
 
 131. What are the principal 
 countries having a silver standard 
 and employing silver coin for cir¬ 
 culation ? 
 
 Mexico, Japan, China and India. 
 
 132. Have we any statistics show¬ 
 ing rate of wages or price of prod- 
 
A COIN CATECHISM 
 
 83 
 
 tA 
 
 <u 
 
 <n 
 0) 
 
 a -g 
 
 0) tn 
 v 
 
 £ d 
 
 fl *J Irt 
 
 •<* C/5 
 tn T3 j? 
 W n O 
 o *-> 
 
 • •-< • H 
 
 ^ a 
 
 * £> 
 
 o 
 
 o 
 
 o 
 
 o 
 
 00 
 
 LO 
 
 *-H 
 
 t" 
 
 CO 
 
 
 CM 
 
 CM 
 
 o 
 
 
 rH 
 
 CO 
 
 C5 
 
 o 
 
 O 
 
 rH 
 
 o 
 
 o 
 
 rH 
 
 o 
 
 ft 
 
 
 % 
 
 * 
 
 
 
 
 
 m 
 
 
 
 
 
 
 
 
 o 
 
 o 
 
 o 
 
 o 
 
 LO 
 
 o 
 
 d 
 
 o 
 
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 LO 
 
 o 
 
 o 
 
 lO 
 
 co 
 
 r-H 
 
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 rH 
 
 o 
 
 <M 
 
 LO 
 
 o 
 
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 rH 
 
 rH 
 
 LO 
 
 
 
 
 
 
 
 
 m 
 
 
 
 
 
 
 
 
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 o 
 
 o 
 
 o 
 
 co 
 
 LO 
 
 LO 
 
 i- 
 
 CO 
 
 
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 oo 
 
 CO 
 
 CO 
 
 0-1 
 
 oo 
 
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 H 
 
 rH 
 
 CO 
 
 o 
 
 rH 
 
 <M 
 
 rH 
 
 GO 
 
 
 
 
 
 
 
 
 €£= 
 
 
 
 
 
 
 
 
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 CO 
 
 C5 
 
 d 
 
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 CO 
 
 00 
 
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 t- 
 
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 t- 
 
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 rH 
 
 co 
 
 CM 
 
 o 
 
 
 
 
 
 
 
 
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 2 
 
 tn 
 
 <u 
 
 tj 
 
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 P< 
 
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 W 
 
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 a u 
 a cs 
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 M 
 
 <u 
 
 2 
 
 tn 
 
 <u 
 
 T)- 
 
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 a 
 
 a 
 
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 d 
 <u a 
 
 u 
 
 u 
 
 a 
 
 d 
 
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 ft 
 
 >-< It! 
 
 a; cl) 
 
 ft ^ 
 
 cti 
 
 o W 
 
 r- 1 P 
 ft CO 
 
 d 
 
 a 
 
 d 
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 ft ft 
 
 Jh V-i 
 
 &S. 
 
 3 
 
 O 
 
 (I) 
 
 itt 
 
 o 
 
 a 
 
 73 
 
 a 
 
 c 3 
 
 <U 
 
 ft 
 
 ft ^ 
 a g 
 
 o o 
 ft ft 
 
 £ fc 
 
 ft ft 
 
 aT d 
 o ^ 
 
 •i-i rt 
 
 ft ft 
 
 d 
 
 ft 2 
 c 1:3 
 
 d ° 
 
 o ^ 
 
 ^ S 
 
 J-. Q. 
 
 <u 
 
 ft aT 
 
 - 03 
 
 S (L> 
 0) 
 
 ft 
 
 W u 
 
 * In favor of Mexico, 
 
S4 
 
 A COIN CATECHISM. 
 
 ucts in those countries, and, if so, 
 how do they compare with those of 
 the United States ? 
 
 Very little information of the 
 kind is obtainable, but from a pub¬ 
 lication of the 11 Bureau of Ameri¬ 
 can Republics” I have compiled 
 the table on page 83, showing prices 
 of commodities in Mexico in 1890 
 compared with the prices of those 
 in the United States at the same 
 time. 
 
 It will be seen that, excepting 
 beans and coffee, prices of articles 
 mentioned were higher in Mexico 
 than in the United States, compared 
 with the same standard. 
 
 Wages at the same time were, in 
 every occupation, reported much 
 lower, as will be seen by the fol- 
 lowing table, compiled from the 
 same publication. 
 
A COIN CATECHISM 
 
 85 
 
 Difference in 
 favor of 
 United States. 
 
 IMNIMOJCOOSONOOIOOMCON 
 CO ■'f t—i OiONCONOOiOCOHCOO) 
 
 O rH rH CO C^l rH rH r-H rH rH 03 rH 03 
 
 Wages in 
 United States 
 Per Day. 
 Gold Coin 
 or its 
 
 Equivalent. 
 
 OOO’fOiOCONOOO^^OlO 
 
 iCiOiOOOiO’tMQiOLOMIN'^t-O 
 
 C<IC<irHCOCO(MC<li-ICM(MrHCO<MCO<M 
 
 m 
 
 cJ 
 
 p 
 
 w 
 
 43 
 
 ft 
 
 O 
 
 U 
 
 '3 
 
 Equivalent in 
 U. S. Gold 
 Coin. 
 
 OOMCOiO-^COOOiOOOiO’tftCOCO 
 
 aHCOt'-ro®osi>io»ON03o:HH 
 
 t—• i-H rH rH rH rH rH 
 
 43 
 
 kr< 
 
 
 
 a 
 
 • rH 
 
 tfi 
 
 <L> 
 
 b/3 
 
 cl 
 
 £ 
 
 Mexican 
 
 Silver 
 
 Dollar, 
 
 lO 
 
 oooo>or^ioooootc»ooo 
 
 lOiOiOO(NOOlNOOOO(NNiOiO 
 
 03 rH rH rH rH rH 03 03 rH rH rH rH rH 
 
 & 
 
 u; 
 
 a 
 
 o 
 
 •*-> 
 
 rt 
 
 ft 
 
 3 
 
 8 
 
 o 
 
 03 
 
 & 
 +-> 
 • tH 
 
 S 
 
 c/i 
 
 <u n 
 
 C /5 
 
 J-c 
 
 O 
 
 -M 
 
 a « 
 
 03 
 
 <V 
 
 _ c O 3 . 
 
 c U 2 
 
 <U <U 
 
 M 03 ft 
 
 ^ W a 
 o 
 
 o 
 
 ed 
 
 r— cd a • .,_ 
 
 wua^^H 
 
 cd 4j 
 
 dH JJ 
 
 <u vr 
 
 03 M 
 
 a * 
 
 O od 
 
 WO 
 
 CO 
 
 
 • CO 
 
 Vh * 
 
 : co 
 
 • \-t 
 
 a; 
 
 • *-< 
 
 . d> 
 
 -*-> : 
 
 • (U 
 
 : M 
 
 C co 
 
 
 : ^ 
 
 cd 
 
 .fl 
 
 o 
 
 cd 
 
 03 
 
 1-1 
 
 <u 
 
 > 
 
 cd 
 
 <L> 
 
 03 
 
 <u 
 > 
 03’d 
 
 SQ 
 
 a a> 
 a 
 
 r3 
 
 o b£ 
 
 ■ft o £ cd k2 a • 
 
 
 l remen 
 
86 
 
 A COIN CATECHISM. 
 
 There is certainly nothing in 
 these tables to indicate that the la¬ 
 boring man is benefited by an un¬ 
 limited supply of silver. The same 
 authority states that the “peon,” 
 the common farm laborer in Mexico, 
 receives only one-fourth of a Mexi¬ 
 can dollar per day for his labor; 
 that he lives in an “adobe” or mud 
 house, and that all the comforts of 
 civilization are to him unknown. 
 As to the condition of the laboring 
 man in China we need no statistics. 
 To prevent the workingman of that 
 country from coming here to im¬ 
 prove his condition we have built 
 
 up a legislative wall higher and 
 stronger than the stone wall raised by 
 China itself to prevent the invasion 
 of the Tartars. Chinese laborers 
 are more than willing to quit a coun¬ 
 try with a silver standard to seek a 
 home in the United States, notwith¬ 
 standing it has a gold standard. 
 
A COIN CATECHISM. 
 
 87 
 
 133. What countries have only a 
 gold standard ? 
 
 Austria-Hungary, Brazil, Den¬ 
 mark, Egypt, German Empire, 
 Great Britain and her colonies, 
 Portugal, Roumania, Norway, Neth¬ 
 erlands, Servia and Spain; while, 
 in fact, France, Italy, Switzerland, 
 Turkey, Belgium and Greece have 
 absolutely closed their mints to the 
 free coinage of silver and maintain 
 a circulation substantially at par 
 with gold, making the currency of 
 these countries, for all practical pur¬ 
 poses, on a gold basis. 
 
 134. What countries still attempt 
 to maintain an unrestricted bimetal¬ 
 lic system ? 
 
 Bulgaria,Chili and Russia, but the 
 last-named country has had a depre¬ 
 ciated paper currency since 1855, 
 which, owing to the belief that it 
 will be redeemed in gold, is quoted 
 
88 
 
 A COIN CATECHISM. 
 
 about twenty per cent, above that of 
 the silver rouble, and the two other 
 countries are practically on a silver 
 basis. 
 
 135. Which of all these countries, 
 if any, have tried the bimetallic 
 system and abandoned it for a single 
 gold standard ? 
 
 The German Empire abandoned 
 the bimetallic system which had 
 existed for various periods among 
 the several states, and by the acts 
 of December, 1871, and July, 1873, 
 established a uniform gold mono¬ 
 metallic system (for the Empire), 
 coining silver only on government 
 account. 
 
 Great Britain tried the bimetallic 
 system for centuries. In, 1666 it 
 was enacted that all persons might 
 bring their gold and silver to the 
 mint to be coined free of charge, 
 the gold guineas to be reckoned at 
 
A COIN CATECHISM. 
 
 89 
 
 20 shillings in silver, but the 
 guineas passed in circulation for 22 
 shillings. The latter pieces were 
 reduced from time to time, and so 
 were the guineas somewhat, but in 
 1718, as a result of its coinage laws, 
 England was to all intents and pur¬ 
 poses a gold standard country, 
 though authority for its obsolete bi¬ 
 metallism remained upon its statute 
 books until 1816, when gold was 
 made the standard, silver subsidiary, 
 the system now existing, and which 
 has met with little objection and 
 found much favor. 
 
 France also endeavored to main¬ 
 tain bimetalism from 1113 to 1874, 
 and there was no end of effort to 
 make the ratio of value between the 
 two standards the same in law that 
 it was in the market. To that end 
 the mint price of gold was changed 
 146 times, and that of silver 245 
 
90 
 
 A. COIN CATECHISM. 
 
 times. In 1726 the ratio was fixed 
 at 14)4 of silver to 1 of gold, but 
 this ratio proved too higli and silver 
 became the standard of France 
 under the same economic law that 
 made gold the standard in England. 
 In 1785 the ratio was fixed at 15)4 
 to 1 and in 1803 that ratio was re¬ 
 affirmed with a thorough revision of 
 the mint laws authorizing the exist¬ 
 ing coins, but even at this ratio gold 
 w r as undervalued and commanded a 
 premium, and from 1803 to 1850 
 there was no gold in general circula¬ 
 tion throughout the country. Soon 
 after 1850 increased gold supplies 
 came from California and Australia, 
 changingthe ratio of value in France 
 from 15)4 to 15)4 to 1. This change, 
 though it may seem slight, was suf¬ 
 ficient to displace more than 150,- 
 000,000 of silver and to substitute 
 an equal quantity of gold, showing 
 
A COIN CATECHISM. 
 
 91 
 
 how a slight change in the market 
 relation of value between the two 
 metals may displace one metal from 
 circulation and establish the other 
 in its place. 
 
 In 1865 a g rea -t dearth of silver 
 coins had resulted in France and that 
 country entered into a combination 
 with Belgium, Italy, Switzerland 
 and Greece, known as the “Latin 
 Union”, by which the double stand¬ 
 ard at ratio of 15 ^ to 1 was to 
 be maintained, but the free coin¬ 
 age of silver to be restricted to the 
 five franc piece, the coins of less de¬ 
 nomination to be minted only on 
 government account, and at reduced 
 relative weight of pure metal, and 
 all to be redeemable in gold. This 
 brought the desired relief. Owing 
 to the fall in the price of silver, the 
 free coinage of that metal was first 
 restricted; then in 1874 all silver 
 
92 
 
 A COIN CATECHISM. 
 
 coinage was absolutely suspended 
 by the contracting parties, leaving 
 France and the other countries in 
 the Union practically with a gold 
 standard. The Bank of France to¬ 
 day, however, keeps its gold only by 
 imposing a small charge on large 
 payments of that metal. 
 
 Roumania introduced the double 
 standard in 1867, but in 1890 sub¬ 
 stituted in its place a gold standard. 
 
 ■> Spain in 1868 introduced the bi¬ 
 metallic system like that of the 
 Uatin Union, but since 1878 silver 
 has been coined only on government 
 account, making Spain a gold stand¬ 
 ard country. 
 
 136. If all the nations mentioned 
 and the United States should here¬ 
 after continue to employ only gold 
 as a standard of value, is there not 
 a danger that the increased use of 
 that metal will enhance its price? 
 
A COIN CATECHISM. 
 
 93 
 
 Not at all. The world’s annual 
 production of gold alone for 1894 
 was $181,510,100, against an aver¬ 
 age annual production of both gold 
 and silver from 1801 to 1810 of 
 $48,982,900, and from 1831 to 1840 
 of only $38,271,000. Then the re¬ 
 cent introductiou into commerce of 
 a greatly extended use of notes, 
 checks and drafts has limited the 
 need of actual coin in making ex¬ 
 changes, and this use can be ex¬ 
 tended with safety until coin, except 
 subsidiary silver, need hardly be 
 seen in current transactions. 
 
 137. But if one country may not 
 be able of itself to maintain coins 
 of different market value in circu¬ 
 lation at the same time, might not 
 all the commercial countries of the 
 world agree upon a common lawful 
 ratio for the two metals and main¬ 
 tain it ? 
 
94 
 
 A COIN CATECHISM. 
 
 Such an agreement would in ef¬ 
 fect be an attempt to fix a value 
 for one of the metals as measured by 
 the other to extend throughout the 
 commercial world without regard to 
 the ever-changing conditions of pro¬ 
 duction and facilities of transporta¬ 
 tion. Suppose the ratio should be 
 fixed at 16 to i. Then every man 
 in the world would want 16 pounds 
 of silver just as much as he would i 
 pound of gold, or the ratio would be 
 changed at once. The scheme can 
 not even have a trial were it feasi¬ 
 ble, for of all the countries of 
 Europe having a single gold stand¬ 
 ard not one has signified the slight¬ 
 est desire to return to any bi¬ 
 metallic system, though, at the 
 instance of the United States, four 
 international conventions have been 
 held within 20 years, with a view 
 to introducing such an international 
 
A COIN CATECHISM. 
 
 95 
 
 ratio. The proposition is of it¬ 
 self chimerical in conception and 
 impracticable in application. In¬ 
 creasing a triangle does not make it 
 a square, and extending the opera¬ 
 tions of an economic law will not 
 change the result of its adoption. 
 The law by which the poorer money 
 drives the better from circulation is 
 as unchangeable as the law of grav- 
 ity and coexistive with the universe. 
 Under its operations no matter what 
 laws, treaties or agreements may be 
 made by nations, fixing a common 
 ratio, only that metal which is the 
 cheaper will furnish the standard of 
 value and supply coins for circula¬ 
 tion, and this is generally admitted 
 even by the advocates of free silver 
 coinage. 
 
 138. Then you do not believe 
 bimetallism possible under any con¬ 
 ditions or circumstances ? 
 
96 
 
 A COIN CATECHISM. 
 
 Not in the sense of a free coinage 
 of the two metals at a ratio fixed by 
 law. Such a scheme, wherever and 
 whenever tried, has invariably re¬ 
 sulted in maintaining only the 
 cheaper metal as a standard and the 
 metal to be thus employed may as 
 well be fixed by law at the outset, 
 leaving the other metal to be adapted 
 to it by its use as subsidiary coins, 
 the only way yet devised by which 
 the two metals have ever been made 
 to circulate together to any consid¬ 
 erable extent. Not only is such a 
 scheme based upon well known eco¬ 
 nomic laws, but the fact that bimet¬ 
 allism has been tried by nearly every 
 nation of the world and abandoned 
 as impracticable should keep the 
 United States from any such folly 
 as attempting its restoration through 
 any scheme. 
 
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