“A NATION'S WEALTH TOE A NATION’S NEED.’- 
 
 OUR CURRENCY: 
 
 WHAT IT IS, AND WHAT IT SHOULD BE. 
 
 By JOHN O. DREW. 
 
 HON. GEORGE OPDYKE, 
 
 A man of genius enough to project a thought in advance of his time, and of strength sufficient to hold it firmly 
 
 till the age reached it. 
 
'&XF7C 
 
 INTRODUCTORY. 
 
 * * * «< I on ]y speak right on ; 
 
 I tell you that which you yourselves do know ; 
 
 Point to sweet Caesar’s wounds, poor, poor dumb mouths, 
 
 And bid them speak for me.” 
 
 The writer of the following pages was educated as a merchant in that Delphos 
 of financial and commercial wisdom, Boston ; was nurtured in the lore of the 
 oracles thereof ; and if a year since the idea of a currency without a gold basis 
 had been suggested to him, he would have thought it as big a blasphemy as his 
 Puritan ancestors would have considered the suggestion of a universe without a 
 God. 
 
 The report of the Controller of the Currency of December, 1 872, showing the 
 strikingly meagre amount of our currency, contrasted with that Of other productive 
 and commercial nations, arrested his attention; and as point after point of our 
 empiricism developed themselves, he felt that the country was rapidly tending to 
 suicide, and he knew not that one person existed sympathizing with his views. 
 
 On that point he was soon undeceived, and found that intelligences inferior to 
 none had long preceded him ; had classified facts ; and for the first time in history, 
 a science of finance had been evolved. 
 
 Will the reader please ascribe what good he may find in the following pages 
 to the aid received from the published works of the following named gentlemen: 
 
 Hon. George Opdyke, author of a treatise on political economy ; 
 
 Hon. Wm. A. Buckingham, originator of the bill quoted within ; 
 
 Wallace P. Groom, Esq., editor and publisher of the New York Mercantile 
 Journal / 
 
 Pliny Freeman, Esq., originator of the first practical non- forfeiture plan of 
 life insurance, which has saved millions of dollars for our American widows and 
 orphans ; 
 
 John Earl Williams, Esq., President of the Metropolitan Bank, New York 
 City ; 
 
 Hon. Alexander Campbell, who was one of the first, if not the first, to 
 elaborate these problems ; 
 
 Wm. H. Winder, Esq., whose investigations of the money history and legis- 
 lation of Great Britain from that memorable Sunday morning, February 23d, 1797, 
 when the King, in council, ordered suspension of specie payments until June, 18th, 
 1815, when the nation prematurely resumed. 
 
 If aught of evil appears, let it be ascribed solely to the 
 
 AUTHOR. 
 

 Digitized by the Internet Archive 
 in 2016 with funding from 
 
 University of Illinois Urbana-Champaign Alternates 
 
 https://archive.org/details/ourcurrencywhatiOOdrew 
 
MONEY— ITS FUNCTIONS AND REQUIREMENTS. 
 
 ANALYSIS OF THE GREENBACK. 
 
 T HE function of science is to note facts, 
 and from them learn the principles which 
 underlie them. 
 
 Tea-kettles had agitated their covers for ages 
 before James Watt looked under the fact and 
 discovered the laws, the application of which 
 multiplied the material force of the human 
 race indefinitely. 
 
 Apples had dropped since the days of Adam, 
 but it was reserved for Newton to learn the 
 cause, and therefrom deduce the law which 
 impels and restrains planets in their spheres, 
 and gradually drops the autumn leaf and the 
 snow-flake to their resting-places. 
 
 If such results have accrued from noting 
 sizzling tea-kettles and dropping apples, de- 
 ducing causes and thence arguing to further 
 results, is it not possible, with the chronicles 
 of the past, and the living experience of the 
 last twelve years to deduce a Science of money ? 
 Let us try, beginning with the query — 
 WHAT IS MONEY? 
 
 The Hon. George Opdyke, eminent as a 
 banker and political economist, defines it as 
 “ an instrument of commerce designed to facilitate 
 the exchange of all other commodities by presenting 
 an equivalent in a portable and convenient shape” 
 Now, let us try to learn the requirements for 
 its most perfect usefulness. We find them to 
 be — 
 
 1. Security , that it may never fail of ex- 
 changability for equal values. 
 
 2. Uniformity of value in every part of our 
 country. 
 
 The above two characteristics inhere fully 
 with our present currency. The following are 
 lacking, and if they can be supplied we shall 
 have a currency more perfect by far than any 
 previously existing, and developing our iudus- 
 tries and commerce in as great a ratio as steam 
 has mechanics. 
 
 We believe these defective points can be 
 remedied, and a system evolved, the operation 
 of which will be in accordance with known 
 laws— where science will take the place of em- 
 piricism ; organization be substituted for spas- 
 modic manipulation ; acting as automatically 
 as the governor of a steam engine. 
 
 The qualities needed by our present currency 
 are these : 
 
 3. Stability , that it may not be elevated or 
 depressed by outside influences. 
 
 4. Elasticity , capable by its inherent power 
 of adapting itself to any requirement. 
 
 5. Cheapness , that the average cost of its use 
 shall not exceed the average value of its ser- 
 vice. 
 
 6. Volume , equal to any conceivable emer- 
 gency. 
 
 7. Convertibility into such form as shall be 
 perfectly safe, and subject to satisfactory con- 
 version on demand. 
 
 I will now endeavor to show, in the order 
 above quoted, some of the points where the 
 deficiencies show themselves. 
 
 LACK OF STABILITY AND ELASTICITY. 
 
 The peculiarities of our climate and produc- 
 tive industries, especially farming, are more 
 exacting to a given and fixed amount of cur- 
 rency than those of any other countiy. 
 
 The heat of our summer is so intense that 
 our cereals are in danger of damage in trans- 
 portation, and if they were not, our farmers 
 are too busy in their fields to prepare and 
 cart them ; many factories “ only keep their 
 hands along,” and merchants and bankers take 
 a holiday. 
 
 The functions of money are suspended, and 
 it lies inactive at three per cent, per year. 
 
 September shows a change. The farmers 
 have “ laid away ” — that is, stopped cultivating 
 their corn — thresh out their oats and wheat, 
 shell last year’s corn, and push them toward 
 the seaboard, gradually hurrying more and 
 more as the advance of the season warns them 
 of the approaching close of navigation, which 
 will increase their cost of transportation, while 
 bad roads will double the labor of hauling. 
 Factories'work into the night, and the same 
 amount of money which caused a plethora in 
 the summer, is found to be totally inadequate 
 in the fall. Rich gamblers see it, and not only 
 make “ corners ” in stocks and merchandise, 
 but also in currency ; and this is the second 
 consecutive year our country lias lost millions 
 of dollars in credit and cash, and been on the 
 verge of bankruptcy for want of money to 
 move the crops. 
 
 The lack of stability and elasticity is thus 
 shown, as the same money which was neglect- 
 ed at three per cent, per year in July, is in 
 September inadequate to the demand, even 
 when from twelve to three hundred per cent, 
 per year is offered. 
 
 Hon. George S. Boutwell, ex-Secretary of 
 the Treasury of the United States, said in his 
 report of December 2d, 1872 : 
 
 “A degree of flexibility in the volume of 
 
6 
 
 currency is essential. * * * There is a neces- 
 sity every autumn for moving the crops with- 
 out delay from the South and West to the sea- 
 board, that they may be in hand for export 
 and consumption as wanted. This work should 
 be done, in the main, before the lakes, rivers, 
 and canals are closed, and yet it can not be 
 done without the use of large amounts of cur- 
 rency. 
 
 “ In the summer months funds accumulate 
 at the centers, but the renewal of business in 
 August and September gives employment for 
 large sums, and leaves little or nothing for 
 forwarding the crops in October and No- 
 vember. 
 
 “ Nor would this difficulty be obviated by a 
 permanent increase or a permanent reduction 
 of the volume of currency. The difficulty is 
 due to the natural order of things, and in- 
 creases with the prosperity of the country, as 
 shown in the abundance of its harvests. * * * 
 The problem is to find a way of increasing the 
 currency for moving the crops and diminishing 
 it at once when that work is done.” 
 
 We propose to solve Mr. Boutwell’s problem 
 before we get through. 
 
 LACK OF CHEAPNESS. 
 
 The yearly average increase of our property 
 is not far from three per cent. An average of 
 higher rates argues a merging of the gains of 
 productive industry into the reservoirs of the 
 capitalists. 
 
 No argument is required to show that if the 
 prevailing rates for the use of money continue 
 with us to rule from two to five times those 
 paid by our competitors across the water in 
 ship-building and all other productions, no 
 system of bonuses or tariffs can long sustain us. 
 
 LACK OF VOLUME. 
 
 When the ship-builder designs a first-class 
 steamer, he does not calculate on the mininum 
 of strength, buoyancy, and engine-power re- 
 quired for the finest summer day, but imagines 
 every circumstance of wind, sea, and lee shore, 
 learns the possible maximum requirements, 
 and adds to that somewhat for mistakes and 
 flaws. 
 
 We perceive from the shakiness of our craft, 
 in what would ordinarily be considered smooth 
 water, that there is something radically amiss 
 in construction, and on examining models and 
 working plans, and comparing with others, 
 discover some of the defects. 
 
 For instance, Mr. Knox, Controller of the 
 Currency, in his last report, page 8, shows the 
 entire circulation of the nation, December, 
 1872, on population of 1870, per head, $20.48. 
 
 If we add 10 per cent, to the population for 
 growth in three years (which is right, as we 
 double in thirty years), and deduct the bank 
 reserves of October 3d, 1872, we find currency 
 per head, $13.67. He quotes France, same 
 page, per head, $25.05. He quotes the United 
 Kingdom (England, Ireland, and Scotland) at 
 $19.48. If we should throw out Ireland and 
 Scotland, which have but little money, England 
 would stand easily at $30. 
 
 As England is an old and finished country, 
 and we are just building ours, as a nation 
 we should have at least double her quota, or 
 30 X 2 = $60. Again, as individuals requiring 
 comforts for ourselves, and education for our 
 children, that should again be doubled. 
 
 This, mind you, is the maximum — analagous 
 to the outside estimate of the ship-builder for 
 strength, buoyancy, and steam-power, to meet 
 cyclones, ice-fields, and lee shores. One-eighth 
 the amount would more than suffice us for 
 January, February, June, and July, in ordina- 
 ry years, gradually working up to one-quarter 
 or one-half the amount in September, October 
 November, and December, leaving the balance 
 for extraordinary emergencies. 
 
 LACK OF REDEEMABILITY. 
 
 Practically, this lack has been more ideal 
 than actual, as the greenbacks are legal tender, 
 and all have been eager redeemers with all 
 their personal and pecuniary resources ; and 
 from the moment of the demonetization of gold, 
 and their taking its place as part of our curren- 
 cy, and the basis of the remainder, tlie 3 r have 
 been fully as redeemable as gold ever was. 
 
 But we propose to give them in the currency 
 of the future a power which gold never had : 
 the option of the holder to exchange the same 
 at par for United States interest-bearing bonds 
 — for working of which see next chapter. 
 
 And now let us leave the unpleasant task of 
 criticising the deficiencies of our greenback 
 currency — that efficient friend, which came to 
 our rescue when all else seemed to have de- 
 serted us, and saved the Bepublic for us and 
 for humanity. 
 
 Let us learn how we can strengthen and 
 assist it on its great mission, and send it on its 
 way untrammeled by the weakness, the bur- 
 dens, and the blunders of the past, reinvigorat- 
 ed, conquering and to conqper, until all the 
 rough places shall be made smooth, and the 
 wilderness blossom like the rose. 
 
 THE CURRENCY OF THE FUTURE 
 
 will be the theme of the next article of this 
 series, and will appear in our next number. 
 
OUR CURRENCY— What It Is and What It Should Be. 
 
 STABILITY. 
 
 E have, as a people, demonstrated the 
 possibility of a “church without a 
 bishop, and a state without a king.” We have 
 also created a currency without a specie basis, 
 and for eleven most trying years it has proved 
 the best the world has ever seen. 
 
 Specie, panic-struck, hid or ran away the first 
 year of the war. The greenback bridged the 
 chasm, and when, on return of peace, every- 
 body anticipated a recurrence of the almost 
 universal ruin which followed our other great 
 wars, we moved on, to the astonishment of the 
 world, “ prospering and to prosper.” 
 
 It was a remarkable fact that while, at the 
 close of the war, we moved on with steady 
 steps, England and France reeled like drunken 
 men. 
 
 The reason was the healthfulness of our cur- 
 rency, the strength of our money system; 
 healthy because detached from that most fe- 
 verish of all money elements, specie; strong, 
 because based on the wealth of the nation — its 
 goodness could not be doubted. But in all 
 this “ we builded better than we knew.” 
 
 When Mr. Chase, repulsed by the bullionists, 
 issued his first $20,000,000 greenbacks, he apol- 
 ogized for so doing, putting in the plea of ne- 
 cessity ; and from that time to this the history 
 of our currency has been a series of temporary 
 expedients, compulsory in inception, empyric 
 and spasmodic in execution. 
 
 The child was born amid the sneers and 
 curses of our enemies, and cold shoulders of our 
 friends. If, with such a birth and nursing, it 
 has in its youth been an angel of such good- 
 ness and strength, what may we not expect of 
 its manhood, if cultured with better surround- 
 ings? 
 
 In our last we demonstrated that the ele- 
 ments yet required to perfect our currency 
 were stability, elasticity, cheapness, volume, 
 and convertibility, indicating the diagnosis «f 
 the disease, and now we propose to discuss the 
 mode of cure. 
 
 The contemporary of Luther learning relig- 
 ion only in an unknown tongue — the Galilean? 
 taught only from the venerated Rabbins at the 
 synagogues, or from the sanctimonious Phari- 
 see at the street corners, had no more reason 
 for surprise — the one by sermons in his own 
 vernacular, the other by the eloquent teach- 
 ings of the trees and flowers— than our readers 
 
 have at the very simple prescription for all 
 these ailments. 
 
 Let Congress pass a very simple, and, there- 
 fore, easily-understood law, providing for the 
 issue of treasury notes ( greenbacks ) as legal tender 
 for all purposes whatever , to the extent which the 
 requirements of the country indicate , and make 
 such legal tender reconvertible, at the option of the 
 holders, into Treasury bonds bearing a rate of in- 
 terest not much in excess of the average annual 
 national increase of property — say 3.65 per cent, 
 per year. 
 
 This involves very little, if any, increase of 
 the public debt, whether as represented in cur- 
 rency or bonds, as the old bonds would be re- 
 tired about as fast as the new ones would be 
 issued, and a reservoir would thus be formed 
 into which any surplus currency which might 
 be afloat in a time of business inertia would 
 gravitate as surely as the freshet seeks the 
 ocean, and when the season of commercial ac- 
 tivity again approaches, as certainly as the sur- 
 plus waters of the spring-time are returned 
 from the ocean by automatic action to vitalize 
 vegetation, so would the life-current of the na- 
 tion’s money respond to the demand, again to 
 retire to its resting-place when its work should 
 be accomplished. 
 
 One of our ablest political economists (Wal- 
 lace P. Groom) remarks : 
 
 “ In the interchangeability (at the option of 
 the holder) of national paper money with Gov- 
 ernment bonds bearing a fixed rate of interest, 
 there is a subtile principle that will regulate 
 the movements of finance and commerce as 
 accurately as the motion of the steam-engine 
 is regulated by its ‘governor.’ Such paper 
 money tokens would be much nearer perfect 
 measures of value than gold and silver ever 
 have been or ever can be.” 
 
 The volume of our currency would thus reg- 
 ulate itself and become elastic and redeemable. 
 
 The constantly increasing burdens of the 
 people in paying rates of interest dispropor- 
 tioned to production would exist no longer, 
 and the Government would realize a large 
 economy, as when the currency was out it 
 would on that pay no interest, and when re- 
 turned for redemption into 3.65 bonds, the rate 
 in currency w T ould be much less than it now is 
 in gold. 
 
 The nearest approach we have recently 
 
8 
 
 made toward legislation on this matter is as 
 follows : 
 
 On the 7tli day of January, 1873, the lion. 
 William A. Buckingham (Ex-Governor of Con- 
 necticut, now U. S. Senator from that State) in- 
 troduced a bill in the U. S. Senate, extracts 
 from which wc give below, which was read 
 twice and ordered to be printed. 
 
 It was called up three days after, and referred 
 to the Committee on Finance, which, by its 
 chairman, Mr. Sherman, reported it back on 
 the 16th with an amendment, striking out all 
 after the enacting clause, and inserting matter 
 of an entirely opposite and mischievous char- 
 acter. If my memory serves me correctly, it 
 was then “ laid on the table.” 
 
 Perhaps it was necessary that the evidence 
 of our spring’s and autumn’s history should ac- 
 crue to give further emphasis to the words of 
 eloquence, experience, and wisdom, with which 
 the distinguished author supported his bill. 
 
 We quote below such portion of the bill and 
 remarks as are pertinent to our present subject 
 matter (the parenthesis and italics are ours) : 
 
 “ That it shall be the duty of the Secretary 
 of the Treasury to issue bonds, as herein de- 
 cribed, of denominations not less than one hun- 
 dred dollars, and legal tender notes in denomi- 
 nations not less than (five) dollar(s). 
 
 “That United States legal tender notes, in 
 sums of one thousand dollars and its multiple, 
 shall, on demand by the holder thereof, be 
 redeemed by the Treasurer of the United States 
 (either in coin or) with United States bonds, 
 the principal of which shall be payable on 
 demand in legal tender notes, and the interest 
 on which shall be payable semi-annually (in 
 coin), at the rate of three and sixty-five one- 
 hundredtlis per centum per annum.” 
 
 We quote extracts from the remarks on the 
 bill by Mr. Buckingham. 
 
 * * * “ The industrial interests of the coun- 
 try require and demand a currency elastic, se- 
 cure, and convertible into that which is of 
 more value than the currency itself. A circu- 
 lating medium that shall combine these three 
 qualities wmdd stimulate our energies, increase 
 our commerce, and facilitate exchanges both 
 foreign and domestic. * * * The experience 
 of more than three quarters of a century fur- 
 nishes evidence that we have often exerted our 
 energies until they have been nearly exhausted 
 in order to maintain a system of specie pay- 
 ments which, as yet, has been only intermit- 
 tent. * * * 
 
 “ The internal commerce of the nation does 
 not absolutely require specie resumption. * * * 
 
 In looking over the country I notice its mar- 
 velous progress, and when I see that industry 
 has been richly rewarded, and that nearly 
 every branch of business has been productive 
 of profit during' the past five years, I am not 
 so ready as I have been to curtail the currency 
 by an arbitrary statute for the sake of deceiv- 
 ing the people with the old idea that banks 
 can always maintain specie payments. They 
 have not done it heretofore, for when the 
 pressure came they were no more held by their 
 obligations to redeem than was Samson held 
 by the green withes of Delilah. Nor am I 
 willing to wait in a state of inactivity for busi- 
 ness to increase until it shall make coin and 
 paper of equal value. I would lay aside a 
 theory which, in times of great commercial 
 embarrassment, has furnished no relief, and 
 try the more excellent and practical measure 
 of redeeming circulation in United States 
 bonds. * * * 
 
 “ The bill at first will cause a demand for 
 bonds in exchange for legal tender notes, but 
 when the time shall come that an increase of 
 currency will be demanded for business pur- 
 poses, the tide will change, and notes will be 
 in demand for bonds. Bonds will be exchanged 
 for notes, and notes for bonds. This inter- 
 changeability, taken in connection with free 
 banking and central redemption, makes pro- 
 vision for an elastic currency — a necessity long 
 felt but never secured. 
 
 “ The business of the country is never sta- 
 tionary, but is always contracting or expanding. 
 When it contracts, bonds will be in demand ; 
 when it expands, currency will be in demand. 
 Whenever it shall contract, a man may have a 
 surplus of capital in his business for which he 
 will seek a temporary investment. The bill 
 offers him United States bonds bearing inter- 
 est, and gives him the privilege of taking back 
 his capital whenever he shall require it. The 
 certainty of receiving it whenever demanded 
 will make it for his interest to take and hold 
 the bonds until his necessities for currency are 
 greater than his necessities for interest. On 
 the other hand, the business of the American 
 people will vibrate toward the other extreme. 
 Agricultural products must be moved, labor 
 on unsold manufactures must be paid for, 
 stocks of merchandise must be carried over a 
 dull season, and cornering speculations must 
 be prevented without depending upon adven- 
 titious aid from the Treasury Department, 
 which, if rendered, will in the end prove to 
 be unnatural, impolitic, and inadequate. This 
 will require more currency. If the demand 
 
9 
 
 shall be so pressing that notes will be of more 
 value than bonds, then men can obtain them 
 according to their ability. 
 
 “ Money is the power that moves the com- 
 merce of the nation. No Senate can deter- 
 mine the amount that will be required until it 
 can determine the nature and the amount of 
 business to be transacted. This bill does not 
 propose to limit either the power or the busi- 
 ness, but to adjust the amount of the one to 
 the necessities of the other upon automatic 
 principles, so as to make use of all that shall 
 be necessary, and no more. It will act like the 
 regulator of the throttle-valve attached to a 
 steam-engine. When the load which the en- 
 gine is to move is heavy, the valve opens and 
 the steam presses upon the piston with suffi- 
 cient force to carry it ; when the load is less- 
 ened, the valve closes and the power is not 
 wasted. So, when business increases, it will 
 open the channels through which currency will 
 flow so long as it shall be required, and, as bus- 
 iness contracts, it will return to the vaults of 
 your banks. The exchange of bonds for notes, 
 or of notes for bonds, will cause no excitement 
 and produce no panic or alarm, but will meet 
 the ever-changing conditions and demands of 
 business. * * * Bonds will, at times, be 
 worth more than coin. Again, this increas- 
 ed demand for bonds will be for the home 
 market, aud save a large annual drainage of 
 coin, which would otherwise go to pay interest 
 abroad. 
 
 “ The bill, if its provisions shall be carried 
 out, will also establish our system of banking 
 so firmly upon national obligations as to render 
 the payment of the principal unnecessary, and 
 relieve the present generation of those heavy 
 burdens of taxation which it has borne for 
 years past. 
 
 “ Mr. President, I am not an advocate for an 
 inflated, irredeemable currency. It would over- 
 whelm every industrial interest, and bury them 
 in ruin. There should be no expansion with- 
 out provision for positive redemption. They 
 are practicable measures which, if incorpor- 
 ated into a public act, will increase the value 
 of national securities, reduce the rate of inter- 
 est thereon, and give us an elastic currency re- 
 deemable in that which will approximate the 
 value of coin more closely, and maintain that 
 value more uniformly than any other securities. 
 Try them. They will produce no disturbance 
 and cause no alarm in financial and business 
 circles, but their influence will be as imper- 
 ceptible, and yet as real, as the morning light 
 which ushers in the perfect day.” 
 
 Let us see how this law would practically 
 work in supplying the deficiencies of our pres- 
 ent (greenback) currency, considering them in 
 the order quoted above. 
 
 Stability would be insured, as our currency, 
 for the first time in our history, being entirely 
 under our own control, and based solely on our 
 own property and production, would be free 
 from the “entangling alliances” of the past, 
 which have hitherto, in matters of finance and 
 commerce, bound us as firmly to the dictation 
 of Europe as if the Declaration of Independ- 
 ance had never been proclaimed. 
 
 This is, what it is intended to be, a startling 
 statement, and if it is enough so to shy our 
 leaders away from the deep ruts of the past, 
 we shall be pleased. 
 
 Let us see if it is substantiated by proofs: 
 
 “ The borrower is the servant of the lender,” 
 is a very old truism. 
 
 Being a new country, with everything to 
 construct, and too enterprising and impatient, 
 as a people, to wait for the slow accretions of 
 our own industries and gains in developing 
 national and private undertakings, we have al- 
 ways been, are now more than ever, and for a 
 long time must continue to be, a debtor nation. 
 Gold ever has been, and we see no reason why 
 it should not continue to be, the international 
 regulator of exchanges between nations. 
 
 While we fully concede to it this interna- 
 tional function, we do not admit that this con- 
 cession gives any claim to mix in our internal 
 money relations. The shore line is the divis- 
 ion. Our legal tenders sustain our industries 
 and float our crops to that line ; beyond that 
 all is international and subject to specie liqui- 
 dation of balances. 
 
 Indeed, justice to our creditors, as well as 
 ourselves, would indicate that the small amount 
 of specie we hold in our own right should be 
 devoted to that function. 
 
 Bullionists argue that gold is the world’s cur- 
 rency, and, therefore, should be ours. This ar- 
 gument on their side is not worth a row of pins 
 — as, if it proves anything, it proves that we 
 should accept monarchy, nobility, entail, and 
 primogeniture, and other nuisances which, at 
 much cost of brains, blood, and money, we 
 have happily shaken off. 
 
 We freely accept, as above indicated, gold as 
 an international regulator, but claim a distinct- 
 ive currency for our domestic use, as fully and 
 freely as we claim our other domestic institu- 
 tions. 
 
 When, by reason of war, financial disturb- 
 ance, or any one of a dozen causes, Europe, our 
 
10 
 
 creditor, wants what we owe her, and calls for 
 it in gold, if our currency is based thereon, 
 the foundation is withdrawn and the super- 
 structure tumbles, as it has always tumbled 
 heretofore, burying in its debris the savings 
 and hopes of half a generation. 
 
 “ He doth destroy mine house 
 
 Who doth destroy the prop which holds mine house.” 
 
 With gold demonetized, this is just our posi- 
 tion. Our citizens owe balances to their Euro- 
 pean creditors, variously estimated at from five 
 hundred million to one thousand million 
 dollars, payable on call. These balances will 
 remain undisturbed just so long as our average 
 rate of interest is very much higher than can 
 be obtained in Europe (now from two to three 
 times their rate), and no longer. 
 
 Should the rate with them (implying an in- 
 creased demand for money) rise to our level, 
 or should our rate (implying a more ample 
 supply) fall to theirs, those balances would be 
 called for; in either case with precisely the 
 same results — to wit : an advance in the price 
 of gold. What of it? 
 
 Before the small amount — small, contrasted 
 with our liabilities — we hold could be drained, 
 the augmented premium would have caused 
 all kinds of exportable products and manufac- 
 tures to be sought for, and bought at prices 
 augmented nearly to the advance in gold — 
 much to the benefit of the nation. Who is 
 hurt ? 
 
 Another beneficial result would appear. In 
 exactly the same ratio as the gold premium 
 acted as a bounty to our producers, it would 
 act as a protective, or prohibitory tariff, on im- 
 ports. Again, who is hurt ? 
 
 I am not sure but it would result in annihil- 
 ating free-traders and tariff-men as such, grati- 
 fying the former by closing the custom-houses 
 and discharging the officials, and responding 
 to the latter by an equivalent to a tariff, on a 
 sliding scale, worked without cost, and also 
 responding to all national requirements; thus 
 not only developing all our industries to a 
 hitherto un though t-of activity and extent, giv- 
 ing our commerce the area of the planet for a 
 market, but purifying our political atmosphere 
 from the tendency to corruption engendered 
 by political patronage, which presses on all its 
 surface and permeates every pore. 
 
 Our system designs no fraud on our foreign 
 creditors, who are entitled to their dues when 
 they want them — in fact, it facilitates their real- 
 ization. 
 
 We hold our gold (like all other merchandise 
 and products) subject to the demands of our 
 
 creditors, and, holding the same by so preca- 
 rious a tenure, has it not always been rash to 
 allow it to be the basis of our money, and espe- 
 cially so now, when our currency has stood 
 more firmly than ever, subjected to almost the 
 greatest supposable strain for a dozen years, 
 based on the property and production of the 
 nation? Would it not now be insanity again 
 to tangle all our material interests in what 
 Washington called an “ entangling foreign alli- 
 ance” with Europe? 
 
 Every banker knows the feverishness with 
 which, in the former reign of King Bullion, 
 European events were watched. 
 
 If money was plenty on Threadneedle Street 
 — Bank of England notes three per cent, per 
 year, street rates one-half per cent, less— for- 
 eign creditors ordered their funds invested 
 here ; money plenty, discounts free, and “ every- 
 thing lovely.” 
 
 Then comes a European commotion. Ger- 
 many or somebody else wants money. Gold 
 goes out of the Bank of England. Interest 
 advances there. Our foreign correspondents 
 draw or order remittance; specie is shipped; 
 discounts are shut off ; loans on storage certifi- 
 cates and other collaterals are called in ; mer- 
 chandise sacrificed at half the cost of produc- 
 tion ; thq year’s savings of the merchant are 
 gone in an hour. 
 
 This is but a flurry, which occurs twenty 
 times where a panic does once. 
 
 The flurry is distressful — the panic is horri- 
 ble. Grand old firms, with assets twenty 
 times enough to meet their liabilities, arc upset, 
 smashing smaller fry as they tumble. Honor- 
 able merchants, who to pay the pound of flesh 
 do not wait for Portia’s ruling, but pay it, if all 
 their heart’s blood follow, so that their honor 
 is saved. Daily and hourly destruction of life 
 by the intensest torture. Wealth destroyed 
 more rapidly than in war. Banks sympathiz- 
 ing, but do no more, for at that crisis to afford 
 relief would be their own legal destruction. 
 Cities telegraphing, watching, listening to cities, 
 hoping, trusting, praying that their neighbors 
 would be the first to sunder the chain which 
 is strangling the nation ; and when the word 
 flashes from Albany that our metropolitan 
 banks may clear their necks from the murder- 
 ous halter and suspend , in an instant, simulta- 
 neously, New York and Boston — with a heart- 
 felt Thank God! — breathe. 
 
 But at what a cost ! the accumulation of a 
 decade gone in an hour — and, with many, the 
 last productive decade on earth, and, oh, their 
 widows and orphans ! 
 
11 
 
 Did such disastrous results, worse than sink- 
 ing a navy, occur on any coast, millions, 
 if necessary, would be expended for beacons 
 to warn the sailors. Did they result from 
 physical malaria, not a Grand Jury in Chris- 
 tendom but would indict the cause as a nui- 
 sance. 
 
 But we, with an infatuation more criminal 
 than that of the worshipers of Juggernaut, 
 consider these things as inevitable decrees of 
 nature. 
 
 And, in a sense, so they are, as was the 
 plague of London, and more recent visitation 
 of the cholera, decrees of nature until the 
 causes were removed, when the disease disap- 
 peared with it. 
 
 Men and bretheren ! why will you not apply 
 the same tests of analysis and synthesis to the 
 nation’s life-blood which you do to a hen chol- 
 era or a potato rot. 
 
 We have above more facts to form a science 
 on than Newton’s apple or Watt’s tea-kettle 
 afforded. The cause of the disastrous panics 
 which have before the war so often prostrated 
 our country, are directly traced to specie affil- 
 iation; this is proved by the removal of the 
 cause, which has always been followed by dis- 
 appearance of the symptoms. 
 
 This inference is further sustaii®d by the 
 fact that since our currency has been par- 
 tially sundered from this feverish element, such 
 deplorable phenomena have disappeared, and 
 we have found our circulation healthy in just 
 the same ratio as we have refrained from that 
 disturbing cause. 
 
 From the above we may deduce this axiom : 
 As long as America bases her currency wholly 
 or in part upon specie, Americans live finan- 
 cially on European suffrance. 
 
 In this connection we quote Mr. Charles 
 Sears, one of our best political economists : 
 
 “ Independently of circumstances and on its 
 merits, the ‘Specie Basis’ hypothesis is the 
 most disorganizing element that ever obtained 
 place in society, and its ghostly presentments 
 ought to be laid without benefit of clergy when- 
 ever they show in daylight. 
 
 “ On this hypothesis our monetary, industrial, 
 and commercial system constitute a huge pyra- 
 mid or cone standing upon its apex. Forty 
 billions of property resting upon six billions 
 of current production, which rests for its value 
 upon say seven hundred millions of currency, 
 which in turn for its value rests upon two hun- 
 dred and fifty millions of specie, which, so far 
 as our possession of it is concerned, depends 
 upon the interest and the good-will of our 
 
 rivals in industry and haters of our political 
 system. 
 
 “ The precious metals, being limited in quan- 
 tity, are insufficient to meet the demand for 
 money to effect exchanges, and the quantity is 
 supplemented by the fiction of paper money 
 payable three or four dollars for one in coin. 
 Here is an artificial limit to production and 
 exchange. Coin being limited, bank notes on 
 the specie basis must necessarily be so, even 
 if the legitimate demand for money in produc- 
 tion and exchange be, as it usually is, three 
 or four times greater than the sum of coin and 
 bank notes. At this point a system of extend- 
 ed credits intervenes, and private obligations 
 supplement the bank notes ; so that, upon the 
 day of liquidation, the balances would amount 
 to ten, twenty, or fifty times the amount of 
 coin. 
 
 “ Of course on this system all people in all 
 times have been insolvent. Production and 
 trade have been carried on upon suffrance. 
 So long as confidence continued unimpaired, 
 the movements of property were kept up, but 
 the exigencies of -war, of local trade, of the 
 stock and money speculators (the real money 
 being limited in quantity invites speculation), 
 the natural tendency of the system itself requiring 
 periodical settlements , demonstrate the general 
 insolvency. Within the last fifty years pay 
 day has come quite regularly at the end of 
 every ten years. Something — any one of a 
 dozen or twenty causes, few know what — sets 
 gold flowing out. Fifty millions withdrawn 
 in a short time from their usual places of de- 
 posit is quite sufficient to make the whole vol- 
 ume of coin disappear from ordinary commer- 
 cial circulation as completely as if it never 
 existed. The ‘ Metallic Basis ’ is gone, slipped 
 out ; the pivot of the system is dislocated ; 
 somebody wanted it and took it ; and the pyra- 
 mid tumbles down, burying in il§ -ruins three- 
 fourths of a business generation. The creditor 
 class does not even now get specie payment of 
 balances from the debtors, but such property 
 as may be in possession, or a list of uncollect- 
 able credits. Nor does specie enter into ordi- 
 nary commercial liquidations to much extent at 
 any time. In the immense volume of our ex- 
 changes, specie payments do not enter to tho 
 extent of one-tenth of one per cent. ; the pre- 
 tense of specie payments, therefore, is a false 
 pretense, not innocent by any means, but a 
 ruinous falsehood ; which, together with the 
 limited volume of currency incident to the sys- 
 tem and the consequent high rate of interest, 
 is rapidly concentrating in the hands of a small 
 
12 
 
 class, those who control gold, who ‘ traffic in 
 the revenues of Empire,’ the surplus earnings 
 of the nation. 
 
 “ For a dozen years past we have enjoyed 
 immunity from these commercial cataclysms, 
 although during this period we carried on a 
 devastating war, and our activities were sud- 
 denly arrested and changed into new direc- 
 tions, incident to the close of the war. SucH 
 immunity has been due to two causes: 
 
 “ First, to the fact that we cast out from our 
 monetary system the lying pretense of specie 
 payments. 
 
 “ Second, to the larger volume of currency in 
 circulation, enabling us to make exchanges 
 with facility, and also to make cash settlements 
 more largely than ever before, and so elimi- 
 nating one element of bankruptcy from our 
 dealings, namely, credit. Truth in our mone- 
 tary system, and a larger volume of currency, 
 saved us. 
 
 “ The laws governing the production and ex- 
 change of property necessarily inhere in its 
 representative, therefore the measure of mone- 
 tary issue should be freely responsive to the 
 demand for it in production and exchange. 
 There would be the same propriety in restrict- 
 ing production and exchange by law that there 
 is in restricting by law the issue of the money 
 required for production and exchange, provid- 
 ed always that money represent property, and 
 not person or credit. Money is the currency 
 which floats property, by its title, from hand 
 to hand, as water is a current to float property 
 from place to place ; and there would be the 
 same wisdom in restricting the supply of water 
 in our canals to one-third or other proportions 
 of their capacity, as there is restricting the vol- 
 ume of our currency to one- third or other pro- 
 portion of the volume required to make ex- 
 changes. In either case property perishes by 
 detention in transit. 
 
 “ To establish and maintain a just balance, a 
 working equilibrium between property and 
 money, is a financial problem which, perhaps, 
 only the people of the United States can solve. 
 The opportunity has come, and the method 
 has been indicated, namely, by a Government 
 
 issue of bonds bearing a low rate of interest, 
 which rate shall not much exceed the average 
 annual increase of property and bond certifi- 
 cates ; the bonds and bond certificates to be 
 mutually convertible, at the option of the 
 holder. 
 
 “ These bonds to replace the existing bonds 
 as rapidly as the conversion can be made. 
 They would still represent the public debt, but 
 they also represent part of the cost of our civ- 
 ilization ; they stand for a certain value, name- 
 ly, our institutions, law r s, usages ; and for the 
 present are a suitable basis of currency issue. 
 They would constitute the reservoir into which 
 any surplus currency would speedily flow when- 
 ever the volume afloat should rise above the 
 industrial demand. These bond certificates, 
 together with coin certificates and coin, would 
 provide a currency adequate to all our moneta- 
 ry want. * * * 
 
 “ Whenever we get out of debt, and have no 
 further occasion to issue bonds, property cer- 
 tificates, based on current production, may re- 
 place the certificates issued on the bonds, and 
 the current expenses of Government be paid 
 from interest on loans. That is to say, the 
 people, collectively, would loan tHeir own 
 money to themselves in their private capacity, 
 and prov^e a currency at so low a rate of in- 
 terest that our resources may be freely devel- 
 oped without artificial restriction, and Govern- 
 ment be maintained without other taxation 
 than the small interest representing part of the 
 annual increase of property. 
 
 “ Every step of change henceforth should 
 contemplate a forward movement toward a 
 popular monetary system, corresponding with 
 our popular political and religious system, and 
 not in any measure tending backward to the 
 financial scheme of past ages, generated of, 
 and in accord with, despotic institutions and 
 caste society, and which has been for our in- 
 dustries a system of organized destruction. 
 
 “ Let us have a people’s money, and abolish 
 credit in exchanges.” 
 
 In future numbers we shall treat on the elas- 
 ticity, cheapness, volume, and convertibility of 
 our proposed system. 
 
THE CURRENCY OF THE FUTURE. 
 
 ELASTICITY, VOLUME, CONVERTIBILITY, AND CHEAPNESS. 
 
 T N the first article of this series (to which, in 
 this connection, we refer our readers) we 
 quoted largely from the able speech of Mr. 
 Buckingham, in the United States Senate, Jan- 
 uary 7th, 1873, and from Mr. Boutwell’s, Secre- 
 tary of the Treasury, report of December, 1872, 
 arraigning the currency for its lack of elasticity. 
 
 The extract from Mr. Boutwell’s report 
 closed thus : “ The problem is to find a way of 
 increasing the currency for moving the crops 
 and diminishing it at once when that work is 
 done.” 
 
 Our response is : Let Congress pass a very 
 simple, and, therefore, easily-understood law, 
 providing for the issue of treasury notes (green- 
 backs) as legal tender for all purposes what- 
 ever, to the extent which the requirements of 
 the country indicate, and make such legal ten- 
 der reconvertible, at the option of the holders, 
 into Treasury bonds bearing a rate of interest 
 not much in excess of the average annual na- 
 tional increase of property — say 3.65 per cent, 
 per year. * 
 
 “ In the interchangeability (at the option of 
 the holder) of national paper money with Gov- 
 ernment bonds bearing a fixed rate of interest, 
 there is a subtile principle that will regulate 
 the movements of finance and commerce as 
 accurately as the motion of the steam-engine 
 is regulated by its ‘governor.’ Such paper 
 money tokens would be much nearer perfect 
 measures of value than gold and silver ever 
 have been or ever can be.” 
 
 Our readers should impress the above firmly 
 in their minds, as there is more financial sci- 
 ence contained therein in its adaptability to 
 our present national need, than in all the vol- 
 umes of political economy ever before written. 
 
 Horace Greeley, in a characteristic editorial 
 of the Tribune , Nov. 9, 1871, said : 
 
 “ The benefits of this sj'stem would be these : 
 Our greenbacks, which are now virtual false- 
 hoods, would be truths. The Government 
 would pay them on demand in bonds, as afore- 
 said, which is in substantial accordance with 
 the plan on which the greenbacks were first 
 authorized. 
 
 “ Our greenbacks, no longer false, but con- 
 vertible at pleasure into bonds bearing a mod- 
 erate gold interest and exchangeable as afore- 
 said, could not fail to appreciate steadily until 
 they nearly reached the level of gold. Indeed, 
 
 they would, unless issued too profusely, be 
 really better than gold. Drawing a higher rate 
 of interest than British consols, and converti- 
 ble at pleasure, as these are not, they would 
 in time obtain currency even in the Old World. 
 
 “ The trouble so inveterately borrowed by 
 thbusands with respect to ‘ over-issues,’ ‘ re- 
 dundant currency,’ etc., would (or at least 
 should) be hereby dispelled. If there were at 
 any time an excess of currency, it would tend 
 to precipitate itself into the bonds aforesaid. 
 If there should ever be a scarcity of currency, 
 bonds would be exchanged at the Treasury for 
 greenbacks till the want was fully supplied. 
 Black Fridays and the locking up of green- 
 backs would soon be numbered with lost arts 
 and hobgoblin terrors. 
 
 “ Though the demand for these bonds might 
 for months be moderate, their convenience and 
 manifest utility would soon diffuse their popu- 
 larity and stimulate an ever-widening demand 
 for them. They would be a favorite invest- 
 ment with guardians and trustees, who should 
 expect to be required to pay over the funds 
 held by them at an early day, whether fixed 
 or uncertain. They would say, ‘ Though I 
 might invest or deposit these funds where they 
 would command a higher interest, I choose to 
 place them where I know they will be safe and 
 at hand when called for.’ 
 
 “ Ultimately, we believe they would become 
 so popular that hundreds of millions of them 
 would be absorbed at or very near the par of 
 specie, and that with the proceeds an equal 
 amount of our outstanding sixes might be re- 
 deemed and canceled, without advertising for 
 loans or paying bankers to shin for us through- 
 out Europe. The interest thus saved to our 
 country would be an important item. 
 
 “ Such are the rude outlines of a plan which 
 we did not originate, but which we heartily 
 indorse. Why not give it a trial? We should 
 dearly like to inform Europe that, since she 
 seems not to want any more of our bonds at 
 five per cent., we have concluded to take the 
 balance ourselves at 3£.” 
 
 Some one has well remarked that the truest 
 test of a scientific theory is in its power of pre- 
 diction. Measured by that severe criterion, 
 the verdict must be in our favor, for, while our 
 opponents have been entirely bewildered by 
 the phenomena of last fall, political economists 
 
14 
 
 of our school predicted them, and placed the 
 predictions on record. 
 
 An analysis of the foregoing programme 
 shows a logical division into four parts, thus : 
 
 1st. Issue of Treasury notes (greenbacks) to 
 the extent which the needs of the country in- 
 dicate. 
 
 2d. Such notes to be legal tenders for all 
 purposes. 
 
 3d. Such notes to be convertible, at the op- 
 tion of the holder, into Government bonds 
 bearing a low rate of interest. 
 
 4th. Such bonds payable, principal and in- 
 terest, in said currency notes on demand. 
 
 The first three have been spasmodically ac- 
 cepted at different times in part; sometimes 
 under pressure of necessity; sometimes from 
 vague aspirations for response to our need — 
 but never in combination. 
 
 The result has been like that of a four-horse 
 balky team — not only not pulling together, 
 but a part laying on the breaching, while the 
 rest pulled on the traces. 
 
 For instance, as to first requirement of am- 
 ple currency, an eminent antagonist in the col- 
 umns of the N. Y. Times , over the signature 
 of “ Knickerbocker,” says : 
 
 “ By reference to the report (Secretary of the 
 Treasury) of August 31, 1865, it will be found 
 that the circulating medium consisted of 
 United States Notes, Greenbacks, and 
 
 Fractional Currency $459,505,311.51 
 
 National Bank Notes and State Bank is- 
 sues, (Report 1865,) by Controller’s 
 Report, Oct. 1, 1865 250,189,478.00 
 
 Total $709,694,789.51 
 
 “ To this amount must be added the sum of 
 five per cent, legal tender notes, and of certifi- 
 cates of indebtedness, etc., shown to have 
 amounted to $443,220,103.16 ; in all, a sum of 
 $1,152,914,892.67. This, then, was the circu- 
 lating medium of the country at the time of its 
 greatest expansion. * * * 
 
 “ The Treasury statement of July, 1868, 
 shows to what extent the circulating medium 
 had been then contracted. It then consisted of 
 United States Notes, Greenbacks, and 
 
 Fractional Currency $388,768,674.75 
 
 National Bank Notes outstanding 1st No- 
 vember, 1867 299,103,996.00 
 
 Total $687,872,670.75 
 
 To which we add the sum of temporary loan 
 certificates and other notes serving the pur- 
 poses of currency, amounting to $92,687,442.64, 
 and the sum of circulating medium will be 
 found to have then reached $780,560,113.39, 
 and shows a contraction by the Secretary of 
 $372,354,779.28 in its total amount. * * * 
 
 “ The country at large had felt the pressure 
 of the screw, but had not been able to discern 
 precisely from what quarter the pinch came, 
 the contraction being confined to those outside 
 forms of Treasury obligations which, though 
 not currency in the strict acceptation of the 
 word, /were still used as such in the larger 
 transactions of trade and financial exchange. 
 When, in a time of general pressure, the cur- 
 rency itself became the subject of the pruning 
 knife, the country not only felt the knife, but 
 saw how it was handled — [these italics are ours] 
 — and refused to submit longer to the ‘ heroic 
 treatment.’ ” 
 
 “Knickerbocker’s” figures, quoted above, 
 take us to July, 1868, when, as the “ people felt 
 the knife, saw how it was handled, and refused 
 to submit longer to the heroic treatment,” the 
 contraction of the cast-iron currency was 
 stopped, and the people allowed to “ grow up 
 to it.” 
 
 Five years have passed, and as we double in 
 population in thirty years, it follows that we 
 are one-sixth larger in 1873 than when we 
 groaned so awfully in 1868. This one-sixth 
 growth, with the same volume of currency, 
 amounts practically to a contraction of one- 
 si^th of the aggregate of 1868, and now we 
 have but $13.68 currency per head (including 
 $40,000,000 in gold quoted by the Controller t 
 of the Currency as “ in circulation ”). which is 
 about one-half the average of France, one-third 
 of England, and 29£ per cent, of that quoted 
 
 “ Knickerbocker ” as existing at the close 
 of the war. 
 
 No wonder that our industries are paralyzed, 
 and our crops stuck in transit for lack of cur- 
 rency to move them. 
 
 With the foregoing figures — taken, mind 
 you, from the compilation of our antagonists — 
 before us on one hand, and Hunt's Year-Book , 
 and other statistical authorities, on the other, 
 let us see how this resulted. 
 
 The mercantile failures in the Northern 
 States, from 1862 to 1870, inclusive, which we 
 copy from Hunt's Magazine and Year-Book for 
 1870, were: 
 
 v Number of Aggregate 
 
 xear - failures. liabilities. 
 
 1862 1,652 $23,049,000 
 
 1863 495 7,899,000 
 
 1864 520 8,579,000 
 
 1865 530 17,625,000 
 
 1866 632 47,333,000 
 
 1867 2,386 86.218,000 
 
 1868 2,197 57.275,000 
 
 1869 2,411 65,246,000 
 
 1870 3,160 79,697,000 
 
 We supplement the foregoing table with the 
 
following (for tlie whole nation), of commercial 
 failures for 1870, ’71, and ’72 : 
 
 _ Number of Aggregate 
 
 * ear * failures. liabilities. 
 
 1870 3,551 $ 88 , 242,000 
 
 1871 2,915 85 , 252,000 
 
 1872 5,009 121 , 056,000 
 
 From the indication of the last few weeks, 
 we must certainly be convinced that the record 
 of .the dead of ’73 will be overwhelmingly in 
 excess of its predecessor. 
 
 This computation does not include any losses 
 not resulting in absolute failures, but it indi- 
 cates beyond cavil that there were six-fold 
 more of losses and disasters during each year 
 of currency contraction than during each year 
 of full currency. 
 
 It will be observed by comparison of dates 
 of contraction with dates of failures that they 
 kept pace in equal step. To effect these re- 
 sults — as orderly and economical as the career 
 of a mad bull in a crockery store — the Govern- 
 ment — 
 
 1st:- Retired its certificates of indebtedness 
 by borrowing gold from Europe at a high 
 rate of interest and giving bonds, which, with 
 exemption from taxation, cost the people at 
 least 10 per cent, currency interest, when the. 
 people themselves would gladly have taken 
 currency, saving all gold premium and interest. 
 
 2d. It created and continued the existence of 
 about $400,000,000, bonds costing 10 per cent, 
 interest as above, to enable it to withdraw and 
 withhold $354,000,000 currency from the peo- 
 ple for no other purpose than to retain said 
 bonds as security for its indorsing the paper of 
 holders of said bonds, for which indorsement 
 said Government gets 1 per cent, per year in- 
 terest, and calls it tax, while the people would 
 have been much better pleased to have retained 
 their own paper and saved the bond interest. 
 In short, in this transaction the people, collect- 
 ively, through their agents, borrow money at 
 10 per cent., and loan it again at 1 per cent, to 
 the bond-holders, who re-loan it to the individ- 
 ual people at 7 per cent, to 50 per cent, per year. 
 
 3d. With plenty of bonds outstanding cost- 
 ing, as above, 10 per cent, interest, it called in 
 and paid off all its 3 per cent, indebtedness. 
 
 4th. It then attempted to absorb the remain- 
 der of the life-blood currency of the people at 
 the rate of $4,000,000 per month, and actually 
 progressed eleven months in the nefarious work 
 when (to quote our antagonist again) “the 
 people not only felt the knife, but saw liow it 
 was handled , and refused to submit longer to 
 the heroic treatment.” 
 
 Like John Le Pean, they “ could eat cater- 
 pillars, but squash bugs were a little too fat.” 
 
 When Jim Fisk and other geniuses stole the 
 Erie Railroad, the splendor of the villainy so 
 dazzled the world that for the moment men 
 forgot to call it stealing. 
 
 A deep conviction is fast gaining ground that, 
 emboldened by that operation, his old fellow- 
 workers, with other conspirators on both sides 
 of the Atlantic — some Jews, others bad Chris- 
 tians — have a deep-laid plot to so reduce the 
 values of the nation that a ring of a thousand 
 men can gobble them all up. 
 
 Most certainly, if such is their plan, the past 
 action and present lethargy of our legislative 
 and executive departments play well into their 
 hands. 
 
 We have endeavored to show that at one 
 time the first requirement of the currency of 
 the future, to wit : adequacy to wants of the 
 country existed, and during its existence we 
 enjoyed, notwithstanding the waste and rav- 
 ages of war, an unparalleled prosperity, and 
 by the highest statistics have also shown de- 
 cadence in prosperity, coextensive with reduc- 
 tion of the currency, until we are now in an 
 almost entire collapse; could show that the 
 material loss to our country from the errors of 
 legislation since the war has been greater than 
 the money cost of the war, and do boldly affirm 
 that, with the loss to our great industrial com- 
 petitor of men by emigration, exhaustion *of 
 her iron and coal, our superior power of pro- 
 duction of the great staples, iron, coal, cot- 
 ton, wool, tobacco, naval stores, grain, petro- 
 leum, gold, silver, etc., and our better mechan- 
 ics, if we avail ourselves of our own domestic 
 money, under scientific regulation, at a cost 
 not much beyond its earnings, in ten years we 
 will have re-established our naval prestige ; 
 become the dominant manufacturing and naval, 
 as we are the greatest agricultural, power in the 
 world, and instead of the planet’s exchanges 
 centering in England, they will be with us. 
 
 The second requirement is that such notes 
 shall be legal tenders for all purposes. 
 
 The present greenback is indorsed as “ legal 
 tender for all debts except duties on imports 
 and interest on the public debt.” "Wipe out 
 these exceptions. The gold received for duties 
 on imports is only required to enable the Gov- 
 ernment to pay out the same for interest. Let 
 it buy. Such will be the stimulus that this 
 domestic, natural, self-sustaining, and self-reg- 
 ulating currency will give to all our produc- 
 tion, that very soon the balance of trade will 
 be in our favor, and gold easy at par. 
 
16 
 
 England, with infinitely smaller resources and 
 larger proportionate foreign liabilities than we, 
 not able to furnish her quota of men for her 
 continental wars, agreed to supply the defi- 
 ciency in money, and did it — boldly meeting 
 the question prohibiting the payment of specie 
 and augmenting her currency. And such a 
 currency ! like her consols (consolidated in- 
 terminable annuities) utterly unredeemable, and 
 therefore infinitely inferior to that proposed 
 by us. But bad as that currency was, it did 
 the work ; her productions were stimulated ; 
 although heavily in debt to the foreigner, the 
 balance of trade soon became largely in her fa- 
 vor. She received balances at her option in 
 gold or her own outstanding obligations. She 
 wisely took the latter, and now her creditors 
 are mostly her own citizens, all civilization her 
 debtors, with perennial balances flowing in 
 from all quarters. 
 
 Since writing the above our attention has 
 been called to an admirable article by W. H. 
 Winder in the New York Express , from which 
 we quote freely thus. Will the reader please 
 remember that convertible in the extract means 
 in gold ? 
 
 In eminent illustration of the foregoing truths 
 we may cite the case of Great Britain, a coun- 
 try in all of the natural elements of wealth 
 inferior to the United States and some other 
 countries, yet from being a heavily debtor 
 country to the foreigner, she has become, by a 
 wise fiscal policy, the wealthiest of countries, 
 the creditor and the banker of the world, pos- 
 sessing the largest foreign trade of any country. 
 All countries are tributaries to this insignificant 
 island, and made so only by her wiser fiscal policy. 
 
 Will not a similar fiscal policy to that which 
 extricated from a large foreign debt, and has 
 so immensely aggrandized Great Britain, with 
 our vastly superior advantages extricate the 
 United States from its foreign debt, and enrich 
 her as it has enriched Great Britain by a 
 “ flourishing ekport trade,” that SOLE specific 
 for the extinction of foreign debt and accumula- 
 tion of wealth ? 
 
 What was that fiscal policy which so surely 
 and so speedily cleared Great Britain from her 
 debt to the foreigner, restored specie payment, 
 and rendered it eminently to her interest to 
 invite all countries to adopt free trade and 
 specie payment ? 
 
 The Government of Great Britain promptly 
 adopted the only policy by which her salvation 
 could be secured ; it prohibited the payment 
 of specie, and made the bank notes money. 
 The effect of this fiscal policy was two-fold: 
 
 1st. It secured a currency impregnable to the 
 foreigner ; it was not in his power to contract 
 and expand at his will the volume of currency, 
 convulsing trade and industry at every change. 
 It is a fact of official record, the truth of which 
 was verified by the Bullion Committee of Par- 
 liament, that no period of specie payment in 
 England, of similar duration as the paper 
 currency, was so free from perturbations as 
 was the era of paper currency ; nor had there 
 been a period of greater activity or equal pro- 
 duction. 
 
 2d. The foreign creditor had but the two 
 modes of an alternative to get home his funds 
 from Great Britain : he could remit in gold or 
 in commodities. The policy o£ Great Britain 
 slight to render gold so dear and inaccessible 
 to the foreigner, that he would find the com- 
 modities in the market cheaper than the gold 
 in market, so that remittance in commodities 
 would be preferable. 
 
 The inevitable result of this policy became 
 immediately apparent in the excess of exports, 
 diminishing on the one hand her imports (be- 
 cause by this fiscal policy the currency acted 
 favorably for domestic commodities and against 
 foreign commodities), and augmenting her ex- 
 ports (the same policy in the currency), compel- 
 ling the foreign creditor to find it to his in- 
 terest to remit in commodities. This demand, 
 forced by the wise fiscal policy of Great Brit- 
 ain, for her commodities, gave full and profit- 
 able employment to her productive industries ; 
 it familiarized the markets of the world with 
 the commodities of Great Britain, and it sys- 
 tematized and perfected her manufactures to a 
 degree which rendered her the equal of any, 
 and the superior to most, countries in the pro- 
 duction of manufactured commodities^ But in 
 the very flow and current of the prosperity 
 from this sagacious fiscal policy, there were 
 then, as now, many crazy people obstreperously 
 clamorous for “specie payment,” who had 
 scarce a glimmering of the true meaning of 
 this term ; ignorant of the fact that the policy 
 then denounced was in strict harmony with 
 the principles of “ specie payment,” Pitt and 
 Addington successfully combated and exposed 
 these delusions. They presented these truths 
 with convincing force — that so long as Great 
 Britain was heavily in debt to “ foreign parts,” 
 specie payment was a most transparent impos- 
 sibility, a clear absurdity ; because, the moment 
 paper was convertible, the only person who 
 would convert it, or who had any occasion to 
 do so, was the foreign creditor ; and as gold 
 would be a better remittance for him at par 
 
17 
 
 than commodities, he would certainly convert 
 his portion of the currency into gold and ship 
 it — thus a resumption of specie payment would, 
 in fact, be only a temporary opening of the 
 vaults of the bank to give the foreigner gold at 
 par for the paper held by him, instead of buy- 
 ing it in market at current rates. The very 
 moment the foreigner should thus have drained 
 the gold, being without specie for the conver- 
 sion of the great bulk of the currency, a sus- 
 pension was again an inevitable result ; but 
 the process of resumption, drainage of the gold 
 basis, and a collapse to suspension of specie 
 payment and a forced return to paper currency 
 would be attended by perturbations in the 
 money market, convulsions among the produc- 
 tive industries, a destruction of values, a dis- 
 bandment of labor and multiplication of pau- 
 pers. All of these evils would be incurred by 
 an abortive attempt at. premature resumption, 
 to return after it all. to a paper currency, with 
 a period for resumption indefinitely postponed. 
 
 * * * It was to Pitt a fact as clear as the 
 noon-day sun that Great Britain, heavily in 
 debt to the foreigner, with a convertible cur- 
 rency, would be acting the part of an idiot in 
 pretending that her huge paper currency was 
 redeemable in gold, when everybody knew 
 that the foreign creditor owned every dollar of the 
 gold ; that it would remain or disappear at his 
 option ; that for no domestic purpose was gold a 
 necessity in no domestic transaction was there 
 any occasion for a dollar of gold. Well might he 
 defy the bullionists to show that resumption by a 
 largely debtor country could benefit any produc- 
 tive industry — could benefit any interest except 
 that of the foreigner and monied man ; that, in 
 fact, the whole sum and substance of such a 
 scheme of resumption was to give the foreigner 
 gold at par for the currency held by him. The 
 blindness and madness of men who bellow 
 about specie payment is, in the face of all the 
 facts, inconceivable. In Great Britain, under 
 the influence of the policy of holding gold, the 
 foreign demand for commodities increased, ex- 
 ports multiplied, her foreign debt dwindled and 
 was rapidly being extinguished, her manufac- 
 turing system was being perfected, and she was 
 fast approaching that point where extinguish- 
 ment of foreign debt is attended with spontaneous 
 resumption of specie payment. * * * 
 
 The country was steadily and surely pro- 
 gressing to liquidation of the foreign debt and 
 to specie payment, and had these bullionists 
 not forced matters, Great Britain would have 
 reached, naturally and without disturbance, all 
 of those objects, and in a condition vastly su- 
 
 perior to that into which she was prematurely 
 forced. We must bear in mind that we pos- 
 sess all of the elements for the production, and 
 successful competition with the foreigner, of 
 iron, cotton, wool, grain, tobacco, naval stores, 
 petroleum, and many other commodities. 
 
 The United States has as much money (gold) 
 as Great Britain. Why can not the United 
 States, with this equal amount of money, pay 
 specie and make loans, as does Great Britain ? 
 It is simply because the gold which is here be- 
 longs to her (England), and she can get it when 
 she wants it, and so with gold in other coun- 
 tries ; it suits her convenience, her policy, and 
 her interest to allow the gold -to rest with for- 
 eign countries until she has need of it. The 
 United States have, really, no gold here or 
 elsewhere, and under its existing financial pol- 
 icy never will own any. * * * 
 
 With natural resources beyond measure 
 greater than Great Britain, by our blundering 
 financial policy we are made simply a milch 
 cow for sagacious England. * * * 
 
 With the withdrawal of the gold by the for- 
 eign creditor, the fabric of “ convertible ” paper 
 falls into ruin ; all of it that was convertible 
 inured exclusively to the foreigner, who did 
 convert his share. Thus the debtor country is 
 left without any money, if only gold and paper 
 convertible into gold be valid money. To 
 convert the other elements into commodities 
 and to distribute them without money is to 
 work with paralytic hands. 
 
 As gold is used exclusively by all nations 
 as international, and paper currency is used 
 exclusively by all nations as domestic currency, 
 tli efact is fixed that there are two distinct, in- 
 dependent currencies. Then why not accept 
 the fact? Why persist in the folly of making 
 the domestic currency depend upon the deal- 
 ings of the foreign or international currency ? 
 Let international currency control internation- 
 al trade ; let domestic currency control domes- 
 tic trade. 
 
 And right here we interject a challenge to 
 all of the advocates of “ convertible currency,” 
 which we are quite sure, however, that not one 
 of them will be found bold enough to accept : 
 
 We affirm that no one can prove that any rise 
 in the price of gold , under paper currency , such 
 as ours , can be detrimental to any American pro- 
 ductive industry. 
 
 Upon this single, simple, sharp, well-defined 
 issue hangs the whole question of a converti- 
 ble currency in a DEBTOR country. In a 
 creditor country a “convertible currency” is 
 indigenous, spontaneous, and unavoidable. 
 
18 
 
 The third point is convertibility of the cur- 
 rency into Government bonds bearing a low 
 rate of interest. We approached that in the 
 currency issued by the act of February 25th, 
 1805 ( facsimile of indorsement of which is 
 herewith given), reading, as will be seen, ex- 
 
 # S »°T E % 
 
 Legal Tender 
 
 for all 
 
 DEBTS, PUBLIC AND PRIVATE, 
 except duties on imports and 
 
 INTEREST ON PUBLIC DEBT, 
 
 and is exchangeable for 
 
 TJ. S. 
 
 Six Per Cent. Twenty Years 
 
 BONDS, REDEEMABLE AT THE 
 PLEASURE OF THE 
 
 UNITED STATES, 
 
 five 
 
 changeable for United States 5-20 bonds. This 
 did not work, as the rate of interest on the 
 bonds was too high, 6 per cent, gold, with ex- 
 emption from taxation and gold premium at a 
 high rate, equaling 10 percent, to 15 per cent., 
 sucked them into the Treasury as fast as they 
 could be issued. 
 
 The Government got out of this scrape by 
 simple repudiation, and there are hundreds 
 of thousands of dollars of that currency now in 
 circulation, some under protest. This experi- 
 ence should teach Congress to make the inter- 
 est rate as low as possible ; $3.65 is really too 
 high. 
 
 But the fourth element, viz., such bonds pay- 
 able principal and interest in such currency on 
 demand is the grand, scientific, controlling ele- 
 ment of the whole. This gives the long-covet- 
 ed and much-sought-for element of elasticity to 
 the currency. This is the element lacking in 
 the British currency of her great wars, and if 
 adopted then by England would have made 
 her currency scientific and automatic in lieu 
 of empiric and spasmodic. This removes the 
 stigma of irredeemability. This removes the 
 temptation of the country banks to send 
 their idle currency in the summer to New 
 
 York, to tempt to speculation; but instead 
 floats quietly to its resting-place in the Treas- 
 ury, there to remain until the requirements of 
 the autumn attract it forth to float the harvest 
 of the nation to the sea-board, where 
 
 —They lightly fall 
 As snow-flakes fall upon the sod, 
 
 But execute the freeman’s will 
 As lightnings do the will of God. 
 
 A short time since an eminent and patriotic 
 banker dined with a friend of mine, and re- 
 marked, concerning a party who had hoarded 
 a hundred thousand dollars through the “ pan- 
 ic,” that “ one who would do that, knowing 
 the needs of the country, should be hung.” 
 “ Whew ! ” whistled my friend. “ What do 
 you mean by that? ” said the banker. “ Only, 
 in this last half of the nineteenth century, when 
 this republic is almost a hundred years old, a 
 gentleman of the culture of yourself who ex- 
 presses such an opinion would be a more eligi- 
 ble subject than the man who does what he 
 pleases with his money. Don’t you see, that 
 as every greenback is but a small Government 
 bond, bearing no interest, the creditor who, 
 under proper legislation, hoards the same is 
 a national benefactor?” was the response. 
 “ That’s so,” said the banker. 
 
 Again, how many times we have been sailing 
 in a cockle-boat, and the skipper has made us 
 all set to the windward to stiffen the craft, and 
 when he “ stood by the sheets to taCk,” how 
 careful he was to have us ready to “ get up and 
 get ” to the other side, that the craft might not 
 capsize ! Again, we see the big men-of-war, 
 whom the weight of a thousand men on one 
 side would not careen. 
 
 I think of that often when folks say, “We 
 build too many railroads.” What hurt does it 
 do if we use our own labor and iron ? and if 
 we import iron and have such a balance of 
 trade in our favor that we can pay in other 
 products, who’s hurt ? Nay, suppose, like 
 most of our railroads, it is built in advance of 
 its requirements ; it may be hard on the build- 
 er, but it is good for the country. 
 
 No, my friend; with our financial system 
 right, the country would be so stiff as to carry 
 all like the man-of-war with its thousand men ; 
 not like the cockle-boat, which tips over if a 
 fellow gets on the wrong side. 
 
FINANCE- A COMMON SENSE VIEW. 
 
 CHEAPNESS. 
 
 A PROMINENT merchant remarked a 
 few days since that the most concise 
 and comprehensive statement of financial econ- 
 omy that he knew was that of Mr. Wilkins 
 Micawber, to wit : 
 
 1st. Given a revenue of £19 19s. 6d. ; expen- 
 ditures, £20 ; result : misery. 
 
 2d. Given a revenue of £20; expenditures, 
 £19 19s. 6d ; result : happiness. 
 
 Apply this principle to the earnings of our 
 productive industries, and the rates paid by 
 them for the use of money. 
 
 Authoritative statistics demonstrate that the 
 average annual increase of our productions is 
 3i per cent. 
 
 The Controller of the currency in his report, 
 December, 1872, shows the average net earn- 
 ings of capital (including surplus) by the na- 
 tional banks for the year ending August 31st, 
 1872, to be 10 36-100 per cent. Add to this 
 rents, salaries, the 1 per cent, interest (called 
 tax) paid to Government, etc., and the figure 
 will be fully 15 per cent. 
 
 This is the bank rate of earnings. When we 
 remember that street rates are largely in excess 
 of those, and that brokers’ commissions, legal 
 costs for searches of real estate — exaggerated 
 to avoid usury laws — etc., should be added, 
 can we doubt that the average rates paid will 
 fall short of 20 per cent ? 
 
 Indeed, the bank returns in some sections 
 show largely in excess. W e quote net earn- 
 ings for year ending Aug. 31, 1872 : 
 
 Milwaukee 
 
 17.93 
 
 Nebraska 
 
 14.02 
 
 Iowa 
 
 17.70 
 
 Oregon 
 
 
 Minnesota 
 
 14.36 
 
 Utah 
 
 
 Missouri 
 
 18.14 
 
 Idaho 
 
 38.87 
 
 Kansas 
 
 15.89 
 
 Montana 
 
 
 To which should be added, as above, cost 
 of rent, salaries, and the 1 per cent, interest 
 (called tax) paid to the Government for orig- 
 inal loan. 
 
 With 3 per cent, earnings and 20 per cent, 
 cost, it follows that somebody sinks 17 per 
 cent, per year, which, in much less than 6 
 years, compounded, would absorb the princi- 
 pal. This would cause a collapse then, but as 
 all property is not hypothecated, liquidations 
 or panics have been spread 10 years apart — 
 say ’37, ’47, ’57, and would have been in ’67 
 but our volume of currency bridged it over. 
 
 The productive interests, universally ac- 
 knowledged even by the old political econo- 
 
 mists as the foundation of all wealth, being 
 thus undermined, eaten out, honeycombed, be- 
 come so weak that at a touch they give way, 
 and the superstructure tumbles. 
 
 As the foundation has never been so promi- 
 nently in sight as the superstructure, the gen- 
 eral observer remarks that such and such a 
 building has tumbled, as palatial houses of 
 finance and commerce go down ; but a little 
 removal of the rubbish will show that the 
 trouble was begun in the cellar walls. 
 
 Here and now let us remark that fhe creditor 
 as well as the debtor interest should unite in 
 staying the devastation of this condition of 
 things, as the former, not seeing that his reve- 
 nues are principally derived from the capital, 
 and not the revenue of his debtor, indulges in 
 extravagant expenditure and injudicious in- 
 vestment, and when the hour of liquidation 
 comes, he falls, and — 
 
 “ — Like the baseless fabric of a vision, 
 
 Leaves not a wreck behind.” 
 
 The elements of his 20 per cent, revenue in 
 commercial language can be analyzed thus: 
 Net earnings of production, as above, 3 per 
 cent ; Insurance (otherwise called guarantee or 
 risk), 17 per cent. 
 
 As he had no policy of insurance for the 
 same, and had not appropriated a sufficient 
 reserve fund for the contingency, but had ex- 
 pended for personal affairs most of what may 
 be called the premium, he falls — equally a vic- 
 tim with his debtor to our fallacious money 
 system. 
 
 Such had been long our convictions, sub- 
 stantiated by many years’ residence and expe- 
 rience in our metropolis, observation of our 
 local and neighboring productive interests, and 
 of commercial and financial matters in the 
 great city; but desirous of more comprehen- 
 sive information, we spent some weeks of the 
 last summer in the interior of Illinois; not 
 traveling by railroads and living at hotels, but 
 in the saddle, carriage, and on foot, mixing 
 with the farmers, staying with them at their 
 homes, and taking part in their field and road 
 work, and, therefore, get our figures from our 
 own investigation. 
 
 The staple of that section is corn ; 40 bushels 
 to the acre is outside the average crop, and 25 
 cents per bushel outside the average price. 
 
20 
 
 Let us see liow this pays the farmer : 
 
 40 bushels corn, at 25 cents, is $10.00 
 
 Shucks and stalks 2.50 
 
 Total proceeds $12.50 
 
 COST. 
 
 5 days man, horses, and implements... $10.00 
 Interest on land, $50, at 10 per cent. . . 5.00 
 
 Taxes, seed, shelling, insurance, etc.. 2.50 
 
 Total cost $17.50 
 
 Loss to the producer $5.00 
 
 or 12| cents per bushel. 
 
 This result may be stated thus : 
 
 1st. If the farmer owes nothing, he gets $2 
 per day for his capital and labor ; can work his 
 land 200 days in the year, giving annual earn- 
 ing at $400; that is, otherwise stated, $10 per 
 acre on 40 acres, which is full work for man 
 and team. Out of that he must pay taxes and 
 shelling. 
 
 2d. Add to the price, 12-£ cents per bushel, 
 and he has enough to pay as above, and 10 per 
 cent, to himself or somebody else for use of 
 money. 
 
 The farmers feel very sore indeed at this con- 
 dition of things; they are working for less 
 compensation than the former slaves ; the la- 
 bor is harder on their wives than on themselves, 
 as the cells in lunatic asylums and early graves 
 testify; they see no chance for education for 
 their children, and on looking around for the 
 cause, the first thing that meets their view is 
 the railroad, with its extreme charges of one 
 to four bushels of corn for taking one to mar- 
 ket ; its watered stock ; its highly-paid officials, 
 its heavy dividends, its numerous sub-corpora- 
 tions, like the pilot, blue, green, anchor line, 
 etc., “ all little credit mobiliers,” — every one 
 of "which they look upon as parasites, eating 
 the life from themselves and families. They 
 are correct as far as they go, and they go a 
 great way. 
 
 But we don’t believe that the virtues are all 
 with one class and the vices with another. 
 
 We argued on a preceding page that the dev- 
 ilish tendencies of our money system bore upon 
 the individual creditor as harshly as upon the 
 debtor, in ultimate result, but with this differ- 
 ence : with the latter the ruin -was instantane- 
 ous, like death by lightning; but with the 
 former a daily, an hourly torment. 
 
 Let us see how our proposed money system 
 would affect th§ railroads : 
 
 As the bank rate of interest is so large, and 
 their monopoly of cheap money from the Gov- 
 ernment is so valuable, resulting in such desir- 
 able official positions for officers and dividends 
 for stockholders, it is but natural that the rail- 
 
 roads, and every other money interest, should 
 measure themselves by the same, especially as 
 the Government pays 5 and 6 per cent, interest 
 and exemption from taxation on its bonds, 
 equaling about 10 per cent. 
 
 If the Government rate was 3.65 per cent., 
 it would not be long before money would be 
 accessible on bond and mortgage at 5 per cent. 
 
 Then, instead of our railroad agents moving 
 heaven and earth to sell good first mortgage 
 bonds bearing 6 per cent, gold interest at 90, 
 they could readily locate 5 per cent, currency 
 bonds at 100. New and needed railroads 
 would be built with double freight and passen- 
 ger tracks where necessary. 
 
 Every present existing railroad east of 
 Buffalo and the Alleglianies could have its 
 double freight tracks, along which processions 
 of freight trains would move at a regular 
 speed of 8 to 10 miles an hour, in lieu of the 
 present dangerous and costly mode of dashing 
 over a single track at the rate of 40 miles an 
 hour to gain a siding for a passenger train to 
 pass, where, perhaps, it may wait hours. 
 
 Those who are unfamiliar with railroad mat- 
 ters can hardly appreciate the dreadful wear 
 and tear of such spasmodic running of freight 
 trains and consequent cost; neither are they 
 prepared to appreciate the immense economies 
 to be effected by substituting moderate speed 
 and continuous running. 
 
 This competition and economy would prob- 
 ably reduce rates one-half to one-third ; in 
 other words, reduce the cost from 40 to 20 
 cents, or 14 per cent, per bushel. 
 
 These economies in the instance of the farm- 
 er, quoted above, say of 5 per cent, on interest, 
 equaling $2.50 per acre, and 20 cents per bush- 
 el on 40 bushels, say $8; total, $10.50 per 
 acre, would overcome the present loss of $5 
 per acre, and substitute a gain of $5.50, making 
 a result of $3.10 per day for himself and a pair 
 of horses 200 days in the year, or an aggregate 
 of $620. Is that an extravagant compensation ? 
 
 Let us see how this would affect our national 
 status. No doubt four times the cereals would 
 be forwarded. This amount would cause a 
 depression of price, followed by immensely in- 
 creased shipments abroad. Instead of Great 
 Britain, as in 1872, taking from Russia 140,000,- 
 000 bushels, and from us 40,000,000 bushels, 
 the figures would at least be reversed. 
 
 Our exports of cereals would be more than 
 quadrupled, as all the excess over about the 
 present sea-board consumption would be 
 shipped. Balance of trade would be over- 
 whelmingly in our favor, and we should re- 
 
21 
 
 peat, but in a much larger degree, the expe- 
 rience of England under very nearly parallel 
 circumstances, quoted a few pages back, of 
 receiving, first, our own bonds as remittance to 
 be paid by Government, or held by our own 
 citizens, and next, a continuous stream of spe- 
 cie, which, without legislation, would rate at 
 par or less for currency. 
 
 Then we should take the position which 
 “ the laws of nature and of nature’s God seem 
 to have assigned to us,” the first power in 
 finance as in production. 
 
 Then will the planet’s exchanges center here, 
 and for the first time in our history will our 
 independence exist in fact, and we shall be no 
 more tributary to England. 
 
 ‘^Seek first,” says the good book, “ the king- 
 dom of God and its righteousness, and all other 
 things shall be added unto you.” The same 
 idea was more profanely expressed by David 
 Crockett, “ Be only sure you are right, then go 
 ahead.” 
 
 It does seem as if this perfecting of our 
 finance system was to be the keystone of the 
 arch of our Republic. 
 
 With all the wisdom and conscientious care 
 of the fathers of our Republic ; with especial 
 care to not only avoid evil, but the appearance 
 of evil, they legislated against even the forms 
 and titles of nobility but left two Oligarchies 
 in our midst. One, the slave oligarchy, said 
 to the nation, “ My life or yours,” and died. 
 The other has reared its head almost as high ; 
 it will be laid as low as its brother. Shall we 
 note the signs of the times and peacefully and 
 scientifically regulate these vital currents of 
 the nation, or shall we continue to drift down- 
 ward in our national career, until the people, 
 having exhausted all expedients to rouse their 
 agents to their duty, appeal to their reserved 
 right of revolution — perhaps it is for our pres- 
 ent Congress to say ? 
 
 But how about the ships to transport this in- 
 creased product across the ocean? is the next 
 query. Our production even now has in- 
 creased so much faster than transportation 
 that ocean freights have advanced from 6 
 pence to 15 pence per bushel — equal to 2 i 
 former steamship prices ; and herein is an ex- 
 tension of the same element of cost to the con- 
 sumer and loss to the producer that we noted 
 •in reviewing railroad freights, and from the 
 same cause, to wit, supply inferior to demand. 
 The same disease, and requiring the same rem- 
 edy, but presenting a different class of phe- 
 nomena. 
 
 We saw that the rivalry (not competition) of 
 
 the oligarchies of money and internal transport- 
 ation tended to large costs of the production 
 of each. These were rivals on the plan of our 
 own money legislation. 
 
 In ocean transportation we compete with 
 a people who were so fortunate in their rulers 
 as to be protected in their domestic money by 
 cutting all money affiliations with those who 
 could destroy them for a period of more than 
 18 years, thus making them creditors, with am- 
 ple resources, instead of debtors, like us, whose 
 money existence depends on the will of others. 
 
 By recognition of, and affiliation with, our 
 insurgents, they wiped most of our merchant 
 marine out of existence, and we, in grateful re- 
 turn for that and other courtesies, form a 
 Credit Mobilier, to keep the use of our own 
 money at so high figures that it is prohibitory 
 of that industry which, in former times, was 
 productive of so much pride and profit to us — 
 we mean 
 
 SHIP BUILD IK G. 
 
 The Secretary of the Treasury says, in his 
 Report, December, 1872 : 
 
 “ The condition of our carrying trade with 
 foreign countries is always a subject of inter- 
 est, and at the present moment it is one of 
 solicitude. The imports and exports of the 
 United States, excluding gold dnd silver, 
 amounted to $1,070,641,163 for the fiscal year 
 ending June 30, 1872, and of this vast trade 
 onty 28^ per cent, was in American vessels. 
 In the year 1860 nearly 71 per cent, of our for- 
 eign commerce was in American ships ; but in 
 1864 it had fallen to 46 per cent., in 1868 to 44 
 per cent., and in 1871 to less than 38 per cent. 
 The earnings of vessels engaged in the foreign 
 carrying trade probably exceed one hundred 
 million dollars a year, of which less than one- 
 third is earned under our own flag.” 
 
 The Secretary estimates earnings of freight 
 money at $100,000,000, a very low estimate. 
 
 We had in 1860 70 per cent., or $70,000,000 
 
 We had in 1871 38 per cent., or 38,000,000 
 
 Annual loss in earnings of shipping $32,000,000 
 
 The loss of the business of building is at 
 least $200,000,000 — including lumber, labor, 
 and other material. 
 
 A first-class steamer equipped for freight 
 and passengers, ready for sea, costs $800,000. 
 If built by the English, with money at 3 per 
 
 cent., the 
 
 Yearly interest on the same would be $24,000 
 
 If by us, with interest 12 per cent 96,000 
 
 Excess of our interest over theirs, per year $72,000 
 
 or about $1,400 per week, or $200 per day, be« 
 
22 
 
 ing the tax or prohibitory duty in favor of our 
 oligarchy, and our amiable cousins across the 
 water, which our Government, by its utterly 
 absurd restriction on our currency, imposes on 
 that industry in particular, as well as our coun- 
 try in general. 
 
 One of our most distinguished statisticians, 
 Horace H. Day, says : “ On the Clyde, in Scot- 
 land, ships are built and fitted out, with this 
 indispensable tool (money) to work with, at 3 
 per cent., and sometimes 2| per cent., while in 
 this country, as I have said before, everything 
 measured by money is as much higher in value 
 as the difference in the legal rates established 
 by the two Governments in the consols of the 
 one, and bonds of the other. And if a ship- 
 builder to-day, in Maine — most of them are in 
 moderate circumstances (say he is a farm-owner 
 worth thirty thousand dollars) — wishes to build 
 a five hundred ton vessel, he must begin by 
 paying, first, at least 15 per cent, annual inter- 
 est on the mortgage of his farm to get the 
 ready cash with which to commence his ship, 
 and as he is not a merchant, keeps no bank 
 balance, and hence can not borrow at banks, 
 as he proceeds will pay 20 per cent, per an- 
 num for the balance of the funds before the 
 ship is paid for (/ know this exact case to be the 
 fact in Maine) ; and this is not all, for by rea- 
 son of the general system of high prices for 
 everything in this country (due wholly to the 
 high rates upon money), the material and wages 
 are found to-day so much higher in the United 
 States than in England that the business is a 
 losing one, and hence we can no longer build 
 ships, while all the remedies now being pro- 
 posed in Congress and elsewhere would only 
 fail in producing a healthy result, and ulti- 
 mately create greater than existing evils. It 
 is this fatal financial system, born of war, es- 
 tablished since and maintained by the Repub- 
 lican Party, which deprives the people to-day 
 of their necessary tools (money) to work with, 
 and the whole country of its rightful inherit- 
 ance of prosperity.” 
 
 Effect this legislation, as England partially 
 did, and the same results which inured to her 
 will accrue to us, but to as much greater ex- 
 tent as our natural resources and position are 
 superior to hers. 
 
 Agriculture, ship-building, and every other 
 branch of industry, will jump at the word 
 “go” Our factories, which now feel poor if 
 not making semi-yearly dividends of 10 per 
 cent. (20 per cent, per year), would then, meas- 
 uring themselves by the Government standard, 
 be satisfied with a much less figure. 
 
 Their fabrics would be exported, and the 
 nation occupying the midway position geo- 
 graphically between the swarming populations 
 of Europe and Asia, with resources superior 
 to either and creditor of both, would be the 
 money center of the globe. And now for the 
 
 MORAL ASPECTS OF THE SUBJECT. 
 
 Our clergy are grieved, astonished, and per- 
 plexed at the demoralization witnessed in the 
 financial walks of life. 
 
 Our citizens abroad, just rid of the stigma of 
 slavery, find themselves facing a national rep- 
 utation of a more loathsome character. 
 
 The name American in Europe is almost, if 
 not quite, a synonym for blackleg and swin- 
 dler. 
 
 The reason is that the dazzling operations 
 of the Jim Fisk tribe and our money oligarch- 
 ies have so dazzled our youth, that not one of 
 a hundred of our educated and enterprising 
 young men adopt a productive occupation as a 
 life-business. 
 
 Few will stop at mercantile business, as it 
 is too slow; no distinction is made between 
 wealth-producing and money-getting. Gam- 
 bling is no longer proscribed. Will any one 
 deny that nine-tenths of Wall Street business 
 is gambling ? 
 
 As the young man approaches the time when 
 he must select his future occupation, he sees, 
 or rather thinks he sees, in the productive 
 branches life-long, imbruting toil and social 
 ostracism, with no opportunity for wealth and 
 distinction. 
 
 Commercial life was accepted until of late,, 
 but the labors and responsibilities are so great 
 as compared with financial life, and the money 
 result so small, that this is passed by, and Wall 
 or State street accepted. And we can nobwon- 
 der when we examine the present status of 
 each. 
 
 Let us suppose a young man with a patri- 
 mony of $20,000. On examining the prospects 
 for commerce, he finds that, owing to the high 
 rate for money, he must incur a 
 
 Rent of say $3,000 
 
 Interest on $20,000 at 10 per cent 2,000 
 
 Clerk hire — say salesmen at $1,500 and $1,000 — 2,500 
 
 Book-keeper, $1,500 ; boy, $250 1,750 
 
 Minimum of current expenses $9,250 
 
 With this capital and the above force, he is # 
 fortunate if, at the end of the first five years, 
 he has done $200,000 per year, at an average 
 gross profit of 7£ per cent., of which i or 2£ 
 per cent, he finds is in bad debts and other 
 losses : 
 
23 
 
 Leaving net 5 per cent, or $10,000 
 
 From which deduct expenses, as above 9,250 
 
 Leaving for his net profit $750 
 
 Which added to the interest per year received.. . 2,000 
 
 Result for his capital, labor, and skill $2,750 
 
 He turns to Wall Street, finds that he can 
 obtain a desk per year for $250 ; no book- 
 keeper, salesmen, or boy, which is a saving of 
 $7,000. Instead of, as a merchant, being at his 
 post at 8 a.m., to be actively engaged until 5 
 p.m., his office hours will be 10 a.m. to 3 p.m. 
 
 In lieu of laborious and costly “ drumming 
 up” of customers and selling goods on credit 
 at 7i per cent, for single names, he quietly waits 
 until paper of the same class and equal merit 
 is brought to him, bearing in addition a first- 
 rate indorsement, or secured by undoubted 
 collaterals, which he can buy, doubly secured 
 as above, at the same profits as that for which 
 the merchant incurs the cost, labor, and risk 
 in selling goods. 
 
 He can easily do the same amount per year, 
 and thus, with less labor and risk, he obtains 
 
 Say 7)4 per cent, on $200,000 $15,000 
 
 Add 10 per cent, on his capital of $20,000 2,000 
 
 Net results in Wall Street $17,000 
 
 “ “ outside $2,750 
 
 The above are trustworthy estimates — out- 
 side - for commerce and inside for Wall Street. 
 So far he has been a neophyte. He gradually 
 learns the inside track — the mysteries of “ takes 
 and puts,” “ bulls and bears,” “ long and short” 
 — corners in stocks, gold and currency ; pur- 
 chasing interests in leading newspapers, affili- 
 ation with popular churches, control at boards 
 of directors, legislatures of States and depart- 
 ments, Congress of the nation. If a dozen men 
 can steal railroads, can not a powerful oli- 
 garchy steal the republic ? 
 
 Can we wonder that the teachings of Christ 
 are supplemented by those of Iago — “ Put 
 money in thy purse.” 
 
 WHERE CONGRESSIONAL APATHY WOULD HAVE 
 LANDED US IN OLD TIMES. 
 
 I know of no evidence showing that the 
 fathers of our political system, when they pub- 
 lished the Declaration of Independence in 
 1776, had any idea of the ultimate form of gov- 
 ernment that their action would result in. 
 
 Congress was, in a manner, a provisional gov- 
 ernment, and in drawing that paper, acted as 
 a grand jury, and indicted their former affilia- 
 tions as a nuisance, trusting to the common 
 sense of the people and their representatives to 
 meet exigencies as they might occur. 
 
 When matters had further progressed, and 
 
 the time to form the permanent government 
 had arrived, they found that history recorded 
 four prominent forms of government, to wit : 
 1st, monarchy — power lodged in a single per- 
 son ; 2d, aristocracy — power lodged in a small 
 number ; 3d, democracy — power lodged in the 
 collective people ; 4th, republic — power lodged 
 with representatives of the people. 
 
 Had they adopted the apathetic and reckless 
 mode of our late Congresses, instead of investi- 
 gating the merits of each, they would by com- 
 mittee have called on the monarchists, as pos- 
 sessed of the longest record and largest influ- 
 ence, who would have told them that mon- 
 archy was what they required, because — 
 
 1st. It had the greatest prestige, its exist- 
 ence running far beyond where the light of 
 history could trace it. 
 
 2d. It was accepted by the human race 
 almost unanimously. 
 
 3d. It bore the divine indorsement. 
 
 4th. History did not record a long existence 
 of any other form of government. 
 
 5th. Any other system would lack affiliation 
 with other nations, and result in isolation from 
 the “ rest of humanity.” 
 
 Jefferson, Sam Adams, Franklin, and other 
 statesmen of the new school, would not have 
 been called on ; but by button-holing members, 
 and an occasional tract, they might have argued 
 that monarchy, proceeding from the family 
 and thence through the clan, was entirely 
 adapted to the advance through savagism and 
 barbarism to civilization, and, as a sequence of 
 its being best for those people and times, might 
 not illogically be claimed as of the grace of 
 God. 
 
 That the failures of the past were caused by 
 the introduction of anti-republican elements in 
 the organizations ; by the undeveloped condi- 
 tion of the people, and by the pressure and in- 
 vasion of adjacent monarchies ; that the educa- 
 tion of our people and our geographical posi- 
 tion were such that a parallel would not hold ; 
 and as for national sequestration, although 
 entirely improbable, would, with our parallels 
 of latitude and longitude, have its benefits as 
 well as evils, and we could stand it if the “ rest 
 of mankind ” could. 
 
 These arguments would have been consid- 
 ered as chimeras of visionary and impractical 
 men, and the committee on form of govern- 
 ment would have brought in and advocated 
 a bill to establish monarchy, perhaps formed 
 by the ministers of George III., exactly as do 
 our committees on finance and the currency, 
 report in the interest of the money oligarchy, 
 
24 
 
 and with about the same arguments. Perhaps 
 the chairman of the committee would travel 
 around the country, assuring the royalists that, 
 although the Tom Jefferson’s ideas might pass 
 the House, they would inevitably be choked 
 off in the Senate. 
 
 Had the apathy which has characterized our 
 legislators of the last few years prevailed with 
 those of the Revolution, I doubt if ten votes 
 for the republic as against monarchy could 
 have been obtained, and we should now be 
 politically affiliated with Europe and the “ rest 
 of mankind.” 
 
 We arraign our national financiers before 
 the country on the following charges, and 
 claim that these charges have been substanti- 
 ated on the preceding pages : 
 
 1st. They have, by abridgment of the quan- 
 tity of our currency, hindered exchanges and 
 diminished production, as a deficiency of water 
 would prevent navigation and stop mill-wheels. 
 
 2d. They have caused the cost of the use of 
 money to be so high as to almost stop produc- 
 tion. 
 
 3d. They have robbed the poor man of his 
 earnings by the excess he was forced to pay by 
 legalized monopolies for use of money over the 
 value of such money to him in aiding his in- 
 dustry. 
 
 4tli. They have retarded education by forc- 
 ing children to work for their maintenence 
 when they should have been in school. 
 
 5th. They have called in money issued direct 
 to the people, and needed by them, and issued 
 to their legalized monopolies, calling the issue 
 indorsement. 
 
 6th. They have, to enable them to withdraw 
 that money from the people, where it was 
 acting in effect as a loan to the country with- 
 out interest, borrowed the same at 6 per cent, 
 gold interest, and exempt from taxation — equal 
 to 10 per cent, per year, and as per count 5 
 loaned it to their creditors at 1 per cent, per 
 year, and called it tax. 
 
 7th. They have reduced the nation’s curren- 
 cy to one-half that of France, and one-third 
 that of England, rendering it possible for their 
 created monopolies, who borrow at 1 per cent., 
 
 to exact five times the rate that foreign indus- 
 tries have to pay. 
 
 8th. They have ruined rich men by enticing 
 them into reckless speculation and personal 
 extravagance, while their capital was under- 
 mined by the excess of interest which legisla- 
 tion had made possible over earnings of in- 
 dustry. 
 
 9th. They have, by restriction of needed cur- 
 rency, prevented internal improvements, thus 
 making the cost of transportation of cereals to 
 the sea-board to act as a tariff against com- 
 merce between the States, at a heavy cost to 
 the producer in favor of his foreign competitor. 
 
 10th. They have crushed ship-building, in 
 which we once excelled the rest of the world. 
 
 11th. They have thrown our carrying trade 
 into the hands of the foreigner, sending the 
 rich harvests of freight money to be spent in 
 Europe, or loaned to us at double the rates our 
 labor can earn for it. 
 
 12th. They have nurtured the foreign mon- 
 opoly of freighting by keeping ours in abey- 
 ance, resulting in an advance to two and a half 
 times former rates — and in gold at that — thus 
 increasing the cost of our products in foreign 
 markets, and diminishing earnings of our pro- 
 ducers. 
 
 13th. They co-operate with our ancient en- 
 emy, England. She , by her Confederate cruis- 
 ers, annihilated our merchant marine, and they 
 make it impossible for us to replace it. 
 
 14th. They have prostrated us as a naval 
 power, as an efficient navy never can exist 
 without a merchant marine as a “ nursery for 
 seamen ” as a precedent condition. 
 
 15th. They have changed our educated and 
 intelligent young men into Wall Street gam- 
 blers. 
 
 16th. They were the prime cause of the 
 Credit Mobilier and back-pay scandal, and the 
 general demoralization of money men of the 
 nation. 
 
 17th. They have given us in Europe the 
 character of a nation of swindlers and black- 
 legs. 
 
 18th. They have transformed the temple of 
 our liberties into a den of thieves.