Full text of The Money Question of the 53rd Congress : Remonetization of Silver : Speech of Hon. James K. Jones of Arkansas, Debate in the Senate, v.2, I-R

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

REMONETIZATION

OF

SILVER.

SPEECH
OF

HON. JAMES K. JONES,
OF

ARKANSAS,

IN THE

S E N A T E OF T H E UNITED

STATES,

FRIDAY, SEPTEMBER 8, 1893.




W A S HINGTON,

1893.




Remonetization of Silver.

S P E E C H
OF

HON. JAMES

K. JONES,

OF ARKANSAS,

I N THE SENATE OF THE UNITED STATES,
Friday,

September 8, 1893.

The Senate having under consideration the bill (H. R. 1) to repeal a part of
an act, approved July 14, 1890, entitled "An act directing the purchase of silver bullion and the issue of Treasury notes thereon, and for other purposes "—

M r . J O N E S of Arkansas said:
Mr. PRESIDENT: T h e present session of Congress was called
to begin at an unusual season, to deal with a situation of great
gravity. Business seemed to be completely stagnated for the
reason that mone^, while it was present in the country in larger
volume than it ever was before, even in the most prosperous
times, refused to circulate, but persistently remained out of the
channels of business. It was said that money could not be borrowed on g o l d ore in the W e s t nor Government bonds in the
East, y e t every one admitted that there never was so much
money in the country. This most extraordinary state of things,
the result of a stampede, is not inaptly called a panic. This condition developed suddenly and is now passing away. T h e r e was
no natural cause for it and it could exist but a short time. It
was not caused by the Sherman law and will pass rapidly away
whether the Sherman law is repealed or not.
But there is another condition, one of infinitely greater importance—a general stringency—which operates in the same
line and affects business in somewhat the same way, and which
may be and doubtless is in many minds confused with the panic,
but which is entirely separate from it. T h e panic was confined to
the United States and was temporary. T h e stringency is worldwide, has been in operation for years, and will be permanent
while present conditions continue. T h e panic bore the relation
to the stringency which the wave does to the tide. T h e string e n c y has held on.for twenty years, g r o w i n g steadily more and
more oppressive, and it will require for its correction the exercise of the highest ability and the wisest statesmanship. This
condition it is our solemn duty to deal with and correct. T o do
this we must understand its cause. N o local cause could produce
it. as it involves every commercial nation on the globe. It is
the natural result of the action of nations unfriendly to silver,
and in the United States it is aggravated by other causes.
T h e volume of the world's money has been lessened, prices
have fallen, bringing distress and ruin to millions in all piirts of
373




3

4

the civilized world, as the result of this action. So grave has
this situation been that in Great Britain it has been the subject
of extensive and careful official investigation: of investigation by
scientific associations and business organizations, and even now
it is agitating the people of that great country as they have not
been agitated since that dreadful period between 1840 and 1850,
and this morning's papers contain cablegrams announcing that
mobs of thousands of people on yesterday drove the entire police force out of certain cities, and the troops are now ordered
out to suppress them.
Our country being new, and the greater part of our resources
really untouched, we might flatter ourselves that we would be
less affected by conditions of this kind than other nations,where
conditions were less elastic. But the truth is that, while we
have been compelled to bear our share of the common evil,the difficulty of our situation has been aggravated by our system of
financial legislation—our tariff laws—which has operated of itself to produce an unjust distribution of wealth, and this has, so
far as we are concerned, intensified the evils resulting from a
contraction of the currency. On the other hand, we have been
in some measure relieved from the full force of the general contraction by a limited coinage of silver, which has during this
period added largely to our stock of metallic money.
These two conditions—the local panic and the general stringency—come from entirely different causes, though the abnormal condition resulting from the stringency, made the panic
possible. If business had remained undisturbed by legislation
during the last thirty years, and had remained in a perfectly natural condition, it would have been impossible to precipitate a
panic such as the one through which we are now passing. But the
unequal distribution of wealth resulting from legislation on silver and the tariff, making the few enormously rich and condemning millions to poverty, has made it possible for an unholy
combination of the unscrupulous rich to make a plaything of
the nation's interest.
They are enabled to precipitate a panic with the purpose of
compelling Congress to yield to their demands and enact such
legislation as they choose to dictate. This is the desperate
game in which they are at this moment engaged, and it remains
to be seen whether the representatives of 65,000,000 of people
will submit to their insolent domination.
But the Senator from New Y o r k [Mr. HILL] has spoken better
than I can of these people in the following language:
Some portion of the present panic—

I would say rather the whole of the present panic—
may be traced to a concerted effort on the part of numerous monometallists
to produce it, in order to further discredit silver as a part of the standard
money of the country.
That fact is apparent everywhere we turn. We observe it in their senseless arguments constantly used against free bimetallic coinage and their
ceaseless endeavors to confuse the present issue by characterizing it as a
contest between monometallism and bimetallism. They seemed to be delighted when the tirst ray of financial trouble appeared.
They hailed the recent action of India with ill-concealed satisfaction. They
talked against silver morning, noon, and night.
They denounced, not simply the Sherman silver-purchase bill, but the
future use of silver money. With ghoulish glee they welcomed every bank
failure, especially in the silver States, little dreaming that such failures
would soon occur at their own doors. They encouraged the hoarding of
money; they inaugurated a policy of refusing loans to the people even upon
379




5
the best of security, they circulated false petitions, passed absurd and
alarming resolutions, predicted the direst disaster, attacked the credit of the
Government, sought to exact a p r e m i u m on currency, and attempted in
every w a y to spread distrust broadsast t h r o u g h o u t the land.
The best financial system in the world could not stand such an organized
and vicious attack upon it. These disturbers, these promoters of the public
peril, represent largely the creditor class, the m e n w h o desire to appreciate
the gold dollar in order to subserve their o w n selfish interests, men w h o revel
in hard times, men who drive harsh bargins with their fellow-men in periods
of financial distress, and m e n wholly unfamiliar with the true principles of
m o n e t a r y science.

The Senator from New Y o r k is a close observer and a man of
ability. His position has enabled him to see and understand the
causes resulting in the panic through which we are passing, and
he has thus left upon record, in clear and forcible language, his
opinion of what is the real cause.
This is a correct statement of the case. The panic is now passing rapidly away, and those who raised the storm will not dare
attempt to check its abatement, though they are impatient to
rush this bill through before the conditions existing a few months
ago shall be fully restored. Hence the effort recently to compel
us to meet at an unusual hour in the morning: hence the newspaper notifications that night sessions will be resort ed to to reach
an early vote, and hence the telegram from New Y o r k published
in this morning's papers that " it was insisted to-night (last night)
among the bankers gathered at the Windsor Hotel that VOORHEES must be urged forward."
W h e n we come to consider the wider question of the general
stringency it requires no argument to show that a decline in
general prices resulting from an insufficient volume of money,
running through a number of years, must of itself inevitably result in the course of time in the utter stagnation of business.
Falling prices render enterprises which were profitable before
unremunerative; render all business ventures doubtful and precarious; make men unwilling to invest, and prevent the supplying
of the necessary means for the prosecution of business enterprises by those who have money to lend, for no man is willing
to invest his money himself, or to lend it to others to be invested
in an enterprise unless he feels morally sure that it will pay.
The effect of falling prices was well described by the Congressional Silver Commission in the following language:
The peculiar effect of a contraction in the volume of currency is to give
profit to the owner of unemployed m o n e y through the appreciation of its
purchasing power by the mere lapse of time. Falling prices r o b labor of its
employment, and precipitate a conflict between it and capital. Money is
withdrawn f r o m circulation and hoarded in consequence of falling prices,
neither paying wages nor serving to exchange the fruits of industry, nor perf o r m i n g the true functions of m o n e y

In all ages periods of long-continued falling prices have been
periods of stagnation in business, want, and increasing poverty.
Such periods have always been dark eras in human history.
They have been periods of repression of human effort and ambition, of degradation, and of political, financial, and moral retrogression. They have been periods fruitful of unrest, social
disturbance, and revolution: for mankind, having once experienced the s.mseof freedom and independence, the elevation and
higher ambition resulting from prosperous times, are not willing to be forced to a condition of pr.ictical serfdom. Having
once tasted the sweets of equality under the law they will not.
without a struggle, submit to the unequal operation of unjust
379




6

laws, intended to enrich a few of their fellow-men by imposing
burdens upon them.
Mr. Andrews, at the Brussels conference, very strongly stated
the feeling of the American people as to the present period of
contraction, in the following language:
Gentlemen, as I suggested, a second powerful consideration urges the
thoughtful people of the United States to try and rehabilitate silver as
money of full debt-paying power. It is this: They wish to stay that baneful. blighting, deadly fall of prices which for nearly thirty years has infected
with miasma the economic lifeblood of the whole world. They do not desire to debase the standard of value.
They would have every debt paid in gold or its equivalent, but they do not
wish gold arbitrarily and unjustly appreciated. * * * Mark, it is not low
prices which we condemn. Low prices, once established, are as'good as high;
that is to say, the words " high " and " low, " in respect to prices, are not absolute but relative terms. The everlasting fall of prices, the act of sinking,
is the accursed thing. None profit from it but such as are annuitants and
nothing else, and we may be sure that no civilized state is going to legislate to keep prices falling, when the fall is once seen, as it must soon be
seen, to injure all but the very few unproductive people who live upon their
incomes.

The purpose of the organized attack on silver, which has been
kept up for twenty years, was to drive that metal out of use as
money, and to that extent to diminish the world's supply of
specie and widen the necessity for gold, thereby decreasing the
prices of the commodities by enhancing the value of the lessened
volume of money. This in its partial success has operated as an
enormous drain upon all classes of our people, but has perhaps
borne most heavily upon our farmers.
Hon. Daniel Manning, in his report for 1886, speaking of the
effect of legislation against silver, said:
The monetary dislocation has already cost our farming population, who
number nearly one-half of the total population of the United States, an
almost incomputable sum, a loss of millions upon millions of dollars every
year.

'If these " almost incomputable" sums had remained in the
hands of those who had worked for and honestly earned them,
this great capital would now be distributed all over this land in
small sums in the hands of the people, and there would be peace,
prosperity, and happiness, where we have misery, wretchedness,
and want. Prosperous people make a prosperous country.
Capital is usually anxious to find and diligently seeks for safeand profitable investment, and with this great reserve of wealth
as a security for its safe and speedy return it would now leave its
hiding places in the rich and populous East and begin its proper
and legitimate duty of giving life to commerce.
Indeed, the money of capitalists has been until recently ready
to flow out and to engage in all those various enterprises which
live by and prosper upon the prosperity of the people: but now,
when to the grinding exactions of this all-pervading system of
falling prices and unequal taxation which have sapped slowly
but surely the prosperity of the masses, is superadded the evils
of a panic, capital is timid, and the Shy locks fear that money
parted with will not return again if risked in any business which
depends upon the prosperity of the masses for its success: or, if
satisfied with- the security, they believe that money will rise
more rapidly in value than any mere interest they will receive.
The one proposition submitted to us by the Administration
for the relief of the country is the immediate and unconditional
repeal of so much of the Sherman law as authorizes.the purchase
by the Government of silver bullion: only this and nothing more.
379




7

The President' assures us in his message that the Sherman law
is, in his opinion, the cause of the present trouble, and he recommends only the repeal of a part of the offending law as the
proper remedy for existing evils.
If the present want of confidence has resulted from the Sherman law'it must have come from a fear that the Government
would be unable to redeem its notes issued in purchase of silver
bullion or from a want of confidence in the silver coins of the
Government. There is no other conceivable way in which this
situation could have resulted from the operations of the Sherman law. and in fact the President gives " l a c k of confidence in
the stability of currency values" as the reason.
But it saems to me that a moment's reflection will show that
no such result has followed.
There is no lack of stability in the values of currency, and there
is and has been no lack of confidence in such stability. The Government is redeeming the notes issued under the Sherman law
as fast as presented, and according to the last public debt statement, of the $149,881,958 of such notes issued, $145,420,209 are
in circulation among the people, and though there are millions
of dollars of gold in the Treasury which can be had for the asking for these notes, practically none are presented. They are
evidently, and have all alongbeen considered just as good as gold,
aud have been hoarded instead of gold. This, the Senator from
Ohio, who is urging the pass ige of this bill, himself candidly admitted the other day in the course of his speech. There is and
has been no run on the Treasury for their payment, as there
would be if there was any doubt of their payment.
This is an unanswerable argument. A t a time of panic, resulting from an alleged fear that these notes may not be promptly
redeemed, they are held and hoarded when gold could be had
for them. This is proof positive that there is no want of confidence in them.
Nor is there any want of confidence in the silver coins of the
country. This is perfectly apparent from the fact that the more
than $500,000,000 of silver, which constitutes one-fourth of all of
our money, has been hoarded just as carefully, and has been just
as difficult to borrow or get in any way. as is any other kind of
money. It is absurd to say that the fear of being paid in silver
dollars causes the capitalist to h i d e away his silver dollars and
keep them. Certainly one hundred silver dollars hidden away
and kept for twelve months is not as good as a hundred silver
dollars loaned on unquestioned security w h i c h would be sure to
be returned with the interest at the end of the year. Men are
not such fools as to hide silver for fear of being paid in silver.
The absurdity of this fear is strongly set out in the following
response to a resolution which I had the honor to present to the
Senate some time since:
TREASURY DEPARTMENT.
O F F I C E OF THE S E C R E T A R Y ,
The PRESIDENT

OF THE

SENATE;

Washington, D. C., August 27,1893.

I have the honor to acknowledge the receipt of the following resolution,
adopted b y the Senate on the 16th instant, viz:
•'Resolved, That the Secretary of the Treasury he, and he is hereby, directed to report to the Senate what amount, if any. of the Treasury notes
issued under the act of July 14.1890. c o m m o n l y called the Sherman act. have
been during the present month redeemed by the Government at the request
of the holders thereof in silver dollars, and whether the holders of such
notes were advised at the time of such redemption that they could have gold
379




8
instead of silver if they so desired. The Secretary of the Treasury is also
directed to inform the Senate whether gold coin has been presented recently
to the Treasury Department or any subtreasury and silver dollars asked in
exchange therefor: and, if so, if such exchanges have been made, and
whether the Department would or could exchange silver dollars for gold
coin if requested to do so by the holders of gold."
In response thereto I have the honor to say that during the present month
Treasury notes issued under the act of July 14,1890, amounting to $714,636,
have been redeemed by the Government in silver dollars. While I do not
pretend to have knowledge of the degree of information possessed by the
holders of the notes so redeemed, I am of the opinion that they were fully
advised at the time of such redemption that they could have gold instead of
silver, if they so desired. I base this opinion upon the general publicity
which has been given to the terms of the act, no less than upon the instructions of this Department to the Treasurer and assistant treasurers of the
United States, which have been to the effect that such notes were redeemable in silver dollars at the option of the holders. I am also supported in my
belief by the fact that in the circular of this Department issued to the public
for their guidance in their dealings with the Treasury and containing the
regulations which govern the issue, redemption, and exchange of the paper
currency and the gold, silver, and minor coins of the United States, there is
a paragraph which reads as follows:
" 4. Gold coin is issued in redemption of United States notes in sums not
less than $50 by the assistant treasurers in New York and San Francisco,
and in redemption of Treasury notes of 1890 in like sums by the Treasurer
and all the assistant treasurers."
In further response to jbhe resolution I have to say that recently gold coin
has been presented at an office of this Department and silver dollars asked
in exchange therefor, and that the exchange was not made for the reason
that all the silver dollars in the Treasury at the time were required, under
the provisions of the laws relating to the currency, to be held in the Treasury to cover outstanding silver certificates and Treasury notes issued under
the act of July 14, 1890. At present the Department would not and could not
exchange silver dollars for gold coin if requested to do so by holders of gold
for the same reason; but if the condition of the funds of the Treasury
were such as to afford a margin of silver dollars in excess of silver certifi
cates and Treasury notes outstanding, such exchanges would be made.
Respectfully yours.
J. G. CARLISLE, Secretary.
W e are told that the reason people have w i t h d r a w n t h e i r dep o s i t s f r o m t h e b a n k s is a f e a r t h a t t h e G o v e r n m e n t w i l l n o t b e
a b l e t o make" i t s p r o m i s e s g o o d . W e h a v e a l r e a d y s e e n t h a t t h i s
i s a b s o l u t e l y w i t h o u t f o u n d a t i o n , f o r a l l c l a s s e s of G o v e r n m e n t
m o n e y h a v e b e e n laid away in d e p o s i t vaults side b y side.
Her
promises to pay are not presented for redemption in any unusual
q u a n t i t i e s , b u t t h i s i s n o t s o of t h e b a n k s . T h e s e h a v e h a d t h e i r
obligations presented f o r r e d e m p t i o n in amounts a p p r o a c h i n g
$200,000,000. T h i s d i f f e r e n c e i s e a s i l y u n d e r s t o o d .
There was
no payment demanded f r o m the Government, because there was
n o f e a r of t h e G o v e r n m e n t , and p a y m e n t was d e m a n d e d of t h e
b a n k s , b e c a u s e of a w a n t of c o n f i d e n c e i n t h e b a n k s .
W a s n o t t h i s f e a r b o r n of w i s d o m ? H a s n o t t h e e v e n t p r o v e d
t h a t t h i s w a n t of c o n f i d e n c e was w e l l f o u n d e d ? W e h a v e t h e
r e m a r k a b l e s p e c t a c l e of b a n k s c l a i m i n g t o b e e n t i t l e d t o t h e r e s p e c t a n d c o n f i d e n c e of t h e b u s i n e s s c o m m u n i t y , a d m i t t i n g t h a t
t h e y h a v o m o n e y o n d e p o s i t w h i c h is d u e o n d e m a n d , and y e t
refusing to pay, impudently telling those whose m o n e y t h e y
h a v e t h a t i n t h e o p i n i o n of t h e i r l o r d s h i p s of t h e b a n k s t h a t
t w e n t y o r fifty d o l l a r s a d a y e a c h i s a s m u c h as t h e y s h o u l d h a v e ,
f nd they will give them no more. W i l l not m e n hereafter w h o
h a v e m o n e y to use hesitate l o n g b e f o r e a l l o w i n g i t t o fall i n t o
s u c h h a n d s , and is n o t t h e m a n fortunate w h o has d r a w n his
m o n e y o u t ? If t h e s e b a n k s d e s i r e t o r e s t o r e c o n f i d e n c e , i t s e e m s
t o m e it c o u l d best be d o n e by p r o m p t l y p a y i n g all d e m a n d s
w h e n d u e , as l o n g as t h e y h a v e a n y m o n e y . I t w o u l d b e a n
379




9

honor to a bank to suspend rather than be kept open by such
methods.
T h e demand made upon us now is that there shall be an unconditional repeal of so much of the act of July 14, 1890 (commonly called the Sherman law), as provides for the purchase of
silver bullion. I for one voted against the enactment of that
law, but I am not now ready to vote for the repeal of a small
part of it, and that its only redeeming feature, leaving the
greater and worst part of it still on the statute books.
In fact, the platform of the party to which I belong, and under
which the control of the Government passed into our hands, declares that the Sherman law was a "cowardly makeshift, fraught
with possibilities of danger in the future which should make all
of its supporters, as well as its author, anxious for its speedy repeal.'' That platform did not declare for the repeal of a part of
the Sherman law, but for the repeal of the whole of it.
W h a t did the Sherman law do? It repealed the Bland law. It
authorized the Secretary of the Treasury, as construed by him,
to completely and absolutely suspend the coinage of silver, which
has been done. It prevented the increase of over $2,000,000 per
month in the volume of our metallic currency. It authorized the
purchase of silver bullion and the issue and payment therefor of
Treasury notes which should be a legal tender and receivable for
customs dues. The issue of these Treasury notes, amounting to
three or four millions of dollars per month, increased the volume
of currency more rapidly than the Bland law did, and there have
been issued, and are now in circulation, about $150,000,000 of these
notes, and the volume of the nation's money has been increased
by them to that amount.
T h e great vice of the Sherman law and its leading purpose was
that it w?.s intended to stop the coinage of silver, and it was
against this great iniquity that the Democratic party declared
itself when it denounced that law as a " cowardly m a k e s h i f t / '
Democrats have always believed in the money of the Constitution. W e believe in making money of gold and silver and maintaining the parity between them. I stand ready to carry out the
pie Ige of my party to repeal the Sherman law, the "'cowardly
makeshift," the whole of it, but I will not, in pretended compliance with that pledge, vote for the repeal of the only good features in the bill, leaving its iniquities in full force and effect.
T h e provision for the purchase of silver bullion and the payment for it in new Treasury notes was intended to catch the votes
of Senators from the silver States and did deceive and mislead
them to the great injury of the cause of silver and of their people.
If the coinage of silver was to be stopped, it was proper that
some provision should be made whereby there should be some
increase in the volume of currency. This would in some measure
compensate for the wrong of suspending coinage, and was the
only feature in the Sherman bill which was not directly antagonistic to the public interest. T o repeal this provision and leave
the remainder of the bill inforce is in no sense a compliance with
the requirement of the Chicago platform
T h e whole scheme of the enactment of the Sherman law was
shrewdly devised and cunningly carried out, and now those who
were active in concocting it are ready to repudi *.te the interest
of the silver Senators and their people in their determination to
379




10

carry out their work to its legitimate result. I can not be a
party to the consummation of this wrong. I believe that to repeal that part of the Sherman law which provides for the moderate increase of the circulating medium under a preteuse that
it is a compliance with the Democratic platform, would be a more
" cowardly makeshift'' than the Sherman law itself, and that it
will be as great a fraud as the action of 1873 was, and that it
will be as great a thorn in the sides of all bimetallists who aid
in it as the Sherman law was to the silver men who supported it.
It can not escape our attention that the same cunning and astute
brains conceived both; that the same cafty financiers who covered their real purpose so deftly in the Sherman law are now
keeping in the background their real purpose to destroy silver
under the nonpartisan and patriotic pretense of giving relief to
the country.
I do not believe that the present state of affairs has resulted
in any considerable degree, if indeed in the slightest, from the
Sherman law. Only a few months ago we were told on every
hand that gold was going out of the country as the result of the
Sherman law, but now that gold is returning more radidly than
it went out, with the Sherman law still unrepealed, it is rare
that you find a man so hardy as to assert that opinion. W h e n
we buy more than we sell, we are compelled to settle the balance. W h e n we sell more than we buy, the rest of the world
must settle with us and gold goes out or comes in as the result of
this simple cause, the balance of trade.
Now we are told that the Sherman law has caused the panic
and must bs hurriedly repealed to give relief. Relief is coming,
and in a short time the panic will have been a thing of the past.
It was an unnatural scare, artificially gotten up to accomplish a
purpose. Good men have been led to believe the repeal of the
Sherman law necessary to relieve the country from the effects of
this panic. W h e n they come to see, as they must, that there is
no connection between the two, how can friends of silver, friends
of the people, vote longer against silver under such a pretense?
W e are assured that if the purchasing clause of the Sherman law is not repealed foreigners will not invest in our securities, but will send those they now have home for sale, and will
do so for fear of being paid in silver. And we are further told
that immense numbers of these have already been sent home as
the result of this fear. It can not fail to be clear to any thinking
man, with but a moment's reflection, that this is one of those arguments by the monometallists which were characterized by the
Senator from New Y o r k as ''senseless."
If any securities other than Government bonds are offered in
Europe the parties can contract for payment in any currency
they choose." They can make them payable in gold if the purchasers fear being paid in silver, and no silver legislation can
affect them. No fear of silver can prevent their sale. As to
the danger of having American securities now held abroad returned, it is clear that they will not be given away if they are returned, and they can not be collected until they are due. If they
are sent home, it will simply be because there is a better market
for them here than elsewhere, andbeciuse the owners of them
having lost heavily in the calamities which have overtaken Australia and the Argentine Republic, are compelled to realize on
379




11

something that will bring money with which to make their
losses good.
If sent at all, it will be because our people are willing to buy
and pay cash for thein at rates which the foreigners think satisfactory. W h e n money will not be loaned by our people on such
securities as gold ore or Government bonds, and yet they offer
such prices for the purchase of American securities as causes
them to be sent home in great numbers, it certainly shows that
they have faith in these securities, and that they are getting
them at such prices as will yield them larger returns than mere
interest, no matter how well secured.
The argument certainly will not be held to apply to Government securities by any man of ordinary intelligence. The Senator from Indiana the other day stated the simple truth when he
said:
Sir. no candid observer of existing public facts can believe that this attempted panic and business distress has been inspired by any real fear, or
genuine want of confidence in the credit of the Government, or in the soundness and stability of its various kinds of currency.

And further—
The national credit of the American Republic, tried by every other test
which can be applied, is better and stronger to-day than the credit of any
other government on the globs. Her bonds, her promissory notes to pay her
debt^, as they may be called, bearing a low rate of interest, stand at a premium in the money markets of the whole earth, and even the cold, cowardly
instinct of hoarded, inactive, interest-hunting capital, in its cautious search
for permanent investments, seizes upon them with swift greed wherever
they can be found. The safety of the security appeases somewhat even the
usurer's highly seasoned appetite for richer profits.

W h e n silver was first stricken from our coinage laws, in 1873,
there can be no pretense that it was done because of the low
price of silver bullion. The bullion in a silver dollar was at
that time worth more than a dollar. The fall in the value of
bullion, which was the result of the attack on silver, is now used
as a reason for a further att ick. This only shows that the real
reason for the attack is to be found in something else, ancl that
something is the interest certain wealthy classes had in lessening the volume of money, to thereby increase the value and purchasing power of the remainder. That such has been the effect
no well-informed man can deny.
Cotton, the great crop of the South, the crop upon which our
people absolutely depend for whatever of prosperity they have,
the crop which settles vastly more of European balances than
gold, has declined in price from 20.1 cents per pound in 1873, as
shown by the official Government reports at this moment before
me, to about 6 cents now. It is estimated, as shown by Senator
VANCE, in his very able speech recently, that this decline entailed a loss on cotton products of $1,110,000,000 up to 1890 ancl
it has been proportionately heavier since.
Wheat, the other great market crop of the country, and that
upon which the prosperity of the great Northwest depends, doss
not sell to-day for one-half, or I am not sure that I might not safely
say one-third of what it brought then. This is said to have resulted in the loss of $1,700,000,000 to wheat-growers up to 1890.
This enormous decrease runs through all prices of real as well
as personal property.
But take the table of, index numbers, being an average made
up of forty-five principal commodities on the one hand, and sil379




12

ver on the other, and compare the decline, as shown by the table made up by Sauerbeck, as follows:
Year.

Forty-five
commodi- Silver.
ties.
102
96
95
94
'87
83
88

85
84
82

95.8
93.3
86.7
90.2
86.4
84.2
85.9
85.0
84.9
83.1

Year.
1884.
1885 .
1886.

1887 .

1888 .

1889
1890
1891
1892

.
.
.
.

Forty-five!
commodi- Silver,
ties.
76
72
69
68
70
72
72
72
68

83.3
79.9
74.6
73.3
70.4
70.2
78.4
74.1
65.4

Money is said to be a measure of value, and a measure of value
ought certainly to have stability of value. A fluctuating standard is an abomination and a disgrace. The God of Heaven has
said: u T h o u shalt have a perfect and a just weight; a perfect
and just measure shalt thou have."
The Senator from Massachusetts [Mr. HOAR] quoted approvingly the other day, in his very able speech, the statement of
Mr. Balfour, that money
should be a fair and permanent record of obligation over long periods of t i m e ; " and it was long ago
said that without stability of value money was a fraud. " T h e
present situation is a striking illustration of the truth of the
proposition.
It is as clear as anything can be made that gold has not this
characteristic, and that the effect of striking down silver as a
money metal has been to vastly increase the value—the purchasing power—of gold: that the value of all time contracts has been
enormously increased thereby; that the value of all fixed incomes have been greatly enhanced, without any consideration
whatever, and that the burdens of labor and all who owe debts
have been therebv vastly incre tsed.
It is said that England holds $10,000,000,000 of the obligations
of other nations and people. The census reports show that the
national debts of the civilized nations of the earth amounted in
1890 to the almost incomprehensible sum of $28,660,187,357.
W h e n to this enormous sum is added the bonded debts of the
thousands of corporations and the time contracts of business men
and municipalities, it is easily seen what an incalculable burden is imposed upon the productive classes of mankind by any
increase in the value of the money in which these obligations
are to be paid.
It can not be denied that there has been a steady and apparently a general fall in prices since 1873. This decline is to be
accounted for in but one of two ways; Either that there has
been an improvement in the methods of production affecting
general prices, or the measure of value has increased in value.
It has often been the case that an invention which has greatly
increased the production of any one commodity has lessened the
cost and lowered the price of that article, but it is inconceivable
that such agencies should affect general prices. A general decline in the prices of all products and commodities of 10 per cent
occurring at the same time would indicate not that there had been
379




13

a general improvement in methods of production in all commodities to that extent, for that would he absurd, but it would clearly
and plainly mean an advance of 10 per cent in the value of the
thing by which values were measured—that is, money: and the
distinguished monometallism Mr. Giffen, who is recognized as
one of the ablest and most accurate statistical authorities living,
although a monometallist, is driven by his investigations to admit that the great and steady fall in prices since 1873 was really
a rise in the value of gold, and not a fall in the value of commodities, and that such rise in the value of gold resulted from its
increased use by reason of legislation unfriendly to silver.
In a paper read before the Royal Statistical Society of England,
he. in speaking of a former prediction of his, that in consequence
of the increased demand for gold, consequent upon the action of
1873, that it would increase in value, and that this increase would
be shown by a decline in general prices, used the following language:
If the test of prophecy he the event, there was never surely a better forecast. The fall of prices in such a general way as to amount towhat is known
as a rise in the purchasing power of gold, is generally, I might almost say
universally, admitted. There is much assertion in some quarters that there
is no appreciation of gold, but the assertion is made by those who attach a
meaning, or think they attach a meaning, to the words, which I confess I am
unable to make out and express in my own language, and there can, at any rate,
be no doubt that as the phrase is here limited and defined we have for some
years been in the presence of the phenomenon known as the appreciation of
money,
Measured by any commodity or group of commodities, usually taken as
the measure for such a purpose, gold is undoubtedly possessed of more purchasing power than was the case fifteen or twenty years ago, and this high
purchasing power has been continued over a long enough period to allow
for all minor oscillations.

And in the course of this paper he distinctly recognizes the
expression, " f a l l of prices," as a synonym for rise in the value
of gold.
It may not be out of place in this connection to call attention
to what this distinguished economist said would be the future
effect of this appreciation of gold. He says:
On the whole I see no other outlet from the situation than in the gradual
adjustment of prices to the relatively smaller and smaller supply of gold
which must result from the increasing numbers and wealth of the population of gold-using countries.

A n d upon another occasion, upon the same subject, he used the
following language:
If it is found that the annual supply of gold, now that the transition period
may be considered over, is not sufficient to maintain things in what we may
call an equilibrium, and there is a constant increase in population and in the
resources of mankind from time to time going on, and the supply of new
money is not quite equal to keeps things at equilibrium, then we may have
along continued fall of prices from generation to generation, and this will
probably have very great effect as time goes on. We may perhaps have
what may be called a permanent transition period, as far as I can see.

W h e n we remember the terrible consequences which have
followed periods of great contraction, this admission of that eminent economist may well cause us to hesitate before taking a
step which will aggravate these evils. T h e contemplation of
the misery, ruin, and degradation which must follow in the train
of this perpetual fall of prices is appalling. If the people of this
country are fit to be free they will not submit tamely to any legislation intended to increase the evils which the present circumstances seem to render inevitable.
373




14
Commenting-upon the paper to w h i c h I h a v e just r e f e r r e d and
a t t h e t i m e of i t s b e i n g first r e a d , P r o f . F o x w e l l , h i m s e l f a n
eminent economist, after congratulating Mr. Giffen on the cleann e s s a n d f o r c e of h i s p a p e r , s p e a k i n g of t h e s i t u a t i o n , said t h a t
h e r e g a r d e d it as a m o s t s e r i o u s o n e .
Mr. Giffen had said that the redistribution it involved spelt ruin to individuals. Unfortunately it affected the relation n o t only of individuals, but
of great political classes. I n j u r y t o individuals they m i g h t possibly regard
with complacency, but injury to ciasses caused social discontent, "and this
kind of redistribution might spell revolution.
G r e a t B r i t a i n will, in m y o p i n i o n , s u b m i t to a g r e a t e r d e g r e e
of o p p r e s s i o n f r o m t h i s c l a s s of w r o n g s t h a n o u r p e o p l e .
They
h a v e been accustomed to l o o k upon artificial classes in society
f o r centuries and legislation intended to benefit one class at t h e
e x p e n s e of t h e g e n e r a l b o d y of t h e p r o d u c e r s of t h e n a t i o n w o u l d
be resented and resisted at a m u c h earlier p e r i o d h e r e t h a n
there.
P r o f . J e v o n s h a s e s t i m a t e d t h e a d v a n c e i n t h e v a l u e of g o l d
f r o m 1810 t o 1848 a t 145 p e r c e n t .
The stringency through which
t h e w o r l d is g o i n g n o w is said b y M r . G i f f e n t o b e a p e r i o d of
" great likeness" to that.
But I quote his language:
It is easy to see that the period between the early part of the century and
the eve of the gold discoveries, 1848-'50, was one of great likeness to the
present period since 1873. In both there was the same steady fall of general
prices, a fall which has long been recognized in spite of the unwillingness
of many economists, such as Tooke. to speak of it as a rise in the purchasing power of money, * * *
Hence the general likeness between the period 1815-'45 and the present
time. Appreciation of m o n e y shows itself in both periods in m u c h the same
way. and is of much the same type, though I am inclined to think that the
advance in real wealth before 1845 was not so great as it has since been.
T h e t e r r i b l e c o n s e q u e n c e s of t h e g r e a t i n c r e a s e i n t h e v a l u e
o f m o n e y p r i o r t o 1848 a r e w e l l k n o w n , a n d r e l i e f c a m e o n l y
t h r o u g h t h e d i s c o v e r y of g o l d i n C a l i f o r n i a a n d A u s t r a l i a , a n d
t h e c o n s e q u e n t e n o r m o u s i n c r e a s e i n t h e v o l u m e of t h e w o r l d ' s
metallic money.
S i r A r c h i b a l d A l i s o n , i n h i s H i s t o r y of E u r o p e , t h u s d e s c r i b e s
t h e r e s u l t s o f t h e i n c r e a s e i n t h e v o l u m e of t h e p r e c i o u s m e t a l s
and the wonderful relief w h i c h followed immediately:
The annual supply of gold and silver f o r the use of the globe was by these
discoveries suddenly increased f r o m an average of 10,000,000 pounds sterling
to one of 35,000.000 pounds. * * * The era of the contracted currency and
consequent low prices and general misery, interrupted by passing gleams
of prosperity, was at an end.
Prices rose rapidly and rose steadily; wages advanced in a similar proportion. exxoorts and imports enormously increased, while crime and misery as
rapidly diminished, emigration itself, which had reached (in 1852) 368,000
persons a year, sank to little m o r e than half that amount. W h e a t rose f r o m
40 shillings to 55 shillings and 60 shillings; but the wages of labor advanced
in nearly as great a proportion: they were found to be 30 per cent higher o n
an average than they had been five years before. In Ireland the change was
still greater, and probably unequaled in so short a time in the annals of
history.
Wages of country labor rose f r o m 4d. a day to Is. M. or 2s.; convicted
crime sank nearly a half - and the increased growth of cereal crops under
the genial influences of these advanced prices was for some years as rapid
as its previous decline since 1846 had been.
At the same time decisive evidence was afforded that all this sudden burst
of prosperity was the result of the expanded currency, and by no means of
free trade, in the fact that it did not appear until the gold discoveries came
into operation; and then it was fully as great in the protected as in the freetrade states.
T h i s w o n d e r f u l a m e l i o r a t i o n o f t h e c o n d i t i o n of m a n k i n d w a s
t h e r e s u l t of t h e i n c r e a s e of t h e v o l u m e of m e t a l l i c m o n e y , a n d
379




15

nothing else. The conditions then were identical with the conditions now. The remedy which gave relief then is simple, plain,
and well understood. W h y not apply the same remedy now?
W e are the great producers of silver. God, in His infinite wisdom, has intrusted it to our keeping. Let us swell the volume
of our metallic money until gold is relieved of some of the present pressure upon it, and it shall be brought to represent value
more steadily than it does now.
No one has ever attributed the relief of Great Britain from the
terrible sufferings to which her people were exposed to any
but two causes: to the great increase in the volume of money,
and to her free-trade laws. Both, perhaps, had an influence in
the wonderful prosperity that marked her career from that time,
and it is somewhat remarkable now to see American representatives, when we are surrounded by exactly the same conditions,
advocating a decrease in the volume of money and the perpetuation of restrictive tariff laws as the remedy for our ills.
I heartily join in the demand for " a n honest dollar"; a dollar that is" steady in value; a dollar w h i c h honestly keeps a
record of obligations over long periods of time; a dollar which
does not rob the creditor, but which returns to him at the end
of the contract all that he parted with at the beginning, and at
the same time a dollar which does not rob the debtor, and which
takes from him only so much of his effort, of his labor, as was
contracted for at the beginning.
Gold alone, without silver, does not furnish such a dollar. The
logic of events demonstrate that to all reasonable men, but it
has always been a grinding and exacting taskmaster, reaping
where it has not sown. W e have seen in the course of this
discussion that gold is steadily increasing in value. For the
effect of this let me quote again the language of that distinguished Englishman and resolute monometallist, Mr. Giffen:
A creditor nation is able to draw more from its tributaries, who have to
pay it in the appreciating money, than it would otherwise be able to draw.
To pay the same debt they must send to their creditors 30, 50, perhaps 100 per
cent more produce than they would otherwise have to send. There is no
doubt that in this sense the weight of the gold debt of a debtor country like
India, or the United States, has enormously increased of late years.

Another distinguished Englishman said, some time since:
W e have a clear and definite idea that silver has not depreciated at all; it
is simply gold that has risen. In illustration of this I would point out how
the deterioration in the price of wheat affects the people of the country. It
is quite a fact that a very large proportion of the national debt of this country, upon which we are called upon every year to pay interest, was accumulated at a period when 15 quarters of wheat would buy a consol
To-day it
takes 75 quarters to pay it off.

A dollar which even our creditors confess is thus enormously
increasing the burdens of our debts, and for which we are to receive no consideration whatever, is not an honest dollar, but is
a cheat and a fraud. I shall to the best of my ability oppose the
permanent adoption of this as t.he only coin of the United States,
but will endeavor to associate with it the whiter and honester
dollar of silver in the hope that its vices may be cured.
Secretary Manning, in his report for 1886, used this strong and
suggestive expression:
The mischief pregnant in Great Britain's silver boycott of 1816 leaped to
light when Germany, in 1873, imitated that imperial blunder.

T h e great Secretary admits in the course of this report in express terms, and by implication in the language just quoted, that
379




1G

the demonetization of silver by Great Britain in 1816 had done
no practical harm until Germany had joined her in 1873. W h i l e
he characterized the conduct of Great Britain as an " imperial
blunder," he admitted that it accomplished no harm until
" e q u i p p e d with the ransom paid into the imperial treasury by
a rich but vanquished power, the statesmen of Germany determined, at any cost, to possess her of the gold fetich.*' This union
of these two great powers in an " imperial blunder" made it for
the first time effective and harmful.
If this opinion of Secretary Manning be correct, the greater
number of countries that join in this blunder the greater will be
the evil consequences. It certainly can not be claimed that the
aggravation of this evil renders it harmless. W h y , then, are we
asked to join in the aggravation of this blunder? Shall we do
evil that good may come? God farbid!
I assume that every bimetallist will cordially agree that this
action of Great Britain was a blunder, if not a crime, and, so believing, it is beyond my comprehension how they will vote to
place the United States in the exact position she was, with regard to this question in 1873, when, without the knowledge or consent of her people who are supposed to be masters here, she
became a party to this gi;eat blunder. An indignant and outraged people compelled a relaxation, a partial retracing of that
step in 1878, but it was against the earnest protests of the bondholders and against their most vigorous efforts.
From that time to this the people have been demanding full
coinage of silver. On the other hand, "the idle owners of idle
capital" have been demanding its demonetization. W e are at
this moment, in my opinion, engaged in a final struggle to determine whether the people or the plunderers will win. If this
bill passes, we can not shut our eyes to the fact that we have
gone back to and after twenty years of discussion have ratified
the great fraud of 1873. And I fear that none of us will ever see
relief from this wrong unless it shall come in a way the mere contemplation of which makes us shudder.
W h y should we destroy silver? The common argument now
is that because the bullion value of silver contained in a dollar is
less than its coin value it is unfit for money. That was not the
reason for passing the law of 1873, for then the bullion was worth
more than the coin dollar. I am sure that it was no special antagonism to silver that caused the passage of that act. It was
simply a determination to destroy one-half of the world's metal
money for the purpose of increasing the power and value of the
other half and increasing the value of bonds. The people live by
industry; bondholders live upon it. This is their vocation, and
the purpose of this law was simply to enable them without rendering any equivalent therefor to get a large share of the profit
of the world's labor.
I believe in paying to the uttermost farthing everything that
is due from an individual or a nation, but I will never be a party
to taking the bread from the mouth of honest labor to swell the
fortunes of parasites. I will n j v e r help to turn these political
warts into cancers.
The action of 1873 was not thoughtlessly or unwittingly taken.
Ernest Seyd foretold with startling exactness what the conse379




17

quences of that step would he before it was taken.
1871:

H e said, in

It is a great mistake to suppose that the adoption of the gold valuation by
other states besides England will be beneficial. It will only lead to the destruction of the monetary equilibrium hitherto existing and cause a fall in the
value of silver from which England's trade and the Indian silver valuation
will suffer more than all other interests, grievous as the general decline all
over the world will be.

And—
The strong doctrinism existing in England as regards the gold valuation
is so blind that when the time of depression sets in there will be this special
feature: The economical authorities of the country will refuse to listen to
the cause here foreshadowed; every possible attempt will be made to prove
that the decline of commerce is due to all sorts of causes and irreconcilable
matters. The workman and his strikes will be the first convenient target,
then speculation and overtrading will have their turn.
Later on, when foreign nations, unable to pay in silver, have recourse to
protection; when a number of other secondary causes develop themselves,
then many would-be wise men will have the opportunity of pointing to specific reasons which in their eyes account for the falling off in every branch
of trade. Many other allegations will be made totally irrelevant to the real
issue, but satisfactory to the moralizing tendency of financial writers.

This prediction has been fulfilled with marvelous accuracy.
I have read a recent statement by Sir Guilford Molesworth, a
distinguished member of the House of Commons, that iron industries in that country are said to have lost in the last few
years $800,000,000 and the estimate of losses by the owners and
occupiers of land is $750,000,000. The silk, woolen, and cotton
industries are struggling for an existence, and it is said that
now tenant farmers are losing $100,000,000 a year, and it was estimated that during the year 1885 this class of farmers lost $214,000,000.
All this has been in turn attributed, as predicted, to strikes
and labor agitations, bad harvests, inflation of credit, excess of
production, overtr ding, improved machinery, and spots on the
sun. And in the United States it is accounted for by fear of a reduction of taxes and too much silver money, which more than one
statesmH n asserts that too much money of all kinds is the sole cause
of all this trouble. The situation was graphically and truly described by another eminent Englishman, when he said:
Land and capital are despoiled and enterprise decaying that a nation's
creditors may grow fat in idleness upon the unearned increment of gold. * * *
As gold gets scarce, it seems to get cheaper: that is, the bank rate falls,
but this is not a mark of the real cheapness of abundance; it is only a symptom that, because trade and enterprise are collapsing, no one can profitably
employ capital, and therefore money is a drug.

I favor the coinage of silver for the reason that I believe as
large a supply as possible of gold and silver money is best for
the material interests and advancement of the people. Specie
is necessarily the basis of all paper money, whether issued by
the Government, private individuals, or corporations, and the
larger the percentage of coin in our actual circulation the more
stable will it be and the more confidence will it command
More than 98 per cent of what are called cash trans iction s in the
banks are of paper, and more than 90 per cent consists of the
paper of individuals.
T h e President's message intimates that we are in the presence of a danger of having the gold leave this country. If this
should be the case the exportation of gold would take pl tC3
under what is known as the Gresham law. That law, however,
379

2




18

becomes operative only when there is a redundant currency.
The argument that the Sherman law will put us on a silver basis
assumes two things: First, th.it we now have, or will have if the
Sherman law remains unrepealed, a redundant currency: and
second, that a silver dollar is less valuable than a gold dollar.
It seems to me impossible that our gold and silver money is,
or can in any reasonable time become, redundant. Let us for a
moment look at the facts.
The Treasury Department has made some investigations in this
line, and I quote from the official report of the Comptroller of
the Currency for 1890, and under the head of " substitutes for
money " he says:
In 1881 Hon. John Jay Knox, then Comptroller of the Currency, called upon
all national hanks to report their entire receipts and payments for two days
esignated, so classified as to separately show the amount of gold coin, silver coin, paper money, and checks and drafts, including clearing-house certificates. The reports received in response to the call then made were compiled and tabulated, and published in his annual report for that year.
In 1871, at the request of the late President Garfield, the then Comptroller
asked for a statement of the receipts of fifty-two national banks, and in his
speech on resumption, delivered in the House of Representatives on November 16,1877, he indicates the location of the banks selected, and states the
facts elicited in the following language:
" I n 1871, when I was chairman of the Committee on Banking and Currency, I asked the Comptroller of the Currency to issue an order naming
fifty-two banks which were to make an analysis of their receipts. I selected
three groups. The first was the city banks, The second consisted of banks
in cities of the size of Toledo and Dayton, in the State of Ohio. In the third
group, if I may coin a word, I selected the " countriest' banks, the smallest
that could be found, at points away from railroads and telegraphs. The
order was that those banks should analyse all their receipts for six consecutive days, putting into one list all that can be called cash, either coin,
greenbacks, bank-notes, or coupons, and into the other list all drafts, checks,
or commercial bills. What was the result? During those six days $157,000,000 were received over the counters of the fifty-two banks, and of that
amount $19,370,000 (12 per cent only) in cash, and 88 per cent, that vast
amount representing every grade of business, was in checks, drafts, and
commercial bills."
With this exception, no attempt had ever been made prior to 1881 to ascertain the extent of the use made of substitutes for money in banking operations in the United States. A proper solution of this question will greatly
aid in any attempt which may be made to ascertain the amount of circulating medium necessary to the proper conduct of the business of the country
The gradual retirement of national-bank notes has attracted public attention to this matter, and great prominence has been given to it in recent discussions in Congress and elsewhere.
Being profoundly impressed with ihe importance of the great interests involved and desiring to assist so far as possible in the ascertainment of all
facts necessary to a perfect understanding of the situation, the Comptroller
deemed it best to again ask the associations under his supervision to carefully note and report their receipts for two days named. As a comparison
with the results obtained in 1881 was important, it was thought best to select corresponding days in 1890. In the former year June 30 and September
17 were designated,- in 1890, July 1 and September 17 In the call for 1890,
July 1 was substituted for June 30. for the reason that the latter date this
year fell on Monday, which day of the week it was thought would not exhibit an average day's business.
The necessary communications were prepared on the 16th day of June
last and mailed to 3.438 national-banking associations, that being the number authorized to do business at that date. A blank f o r m was furnished
upon which the entire receipts for the day designated were to be entered and
properly classified.
Reports were received from 3.364national banks out of the 3,438 addressed,
exhibiting their receipts for July 1, 1890.
Similar statements have come to hand from 3,474 associations out of 3,484addressed. giving the same information as to the transactions of S eptember
17, 1890.
On both these days a few banks neglected to take the necessary precautions, and in these cases other near dates, which would represent an average day's business, were substituted. Several of the banks not reporting
were recently organized and had not opened for business on the dates f o r
which statements were required.
379




19
The total receipts of the 3.364 banks on July 1 last were $421,824,726. Of
this sum $3,726,605 was in gold coin, $1,352,647 in silver coin, $3,427,973 in gold
Treasury certificates. $6,442,638 in silver Treasury certificates, $7,881,786 in
legal-tender Treasury notes, $5,244,967 in national-bank notes, $520,000 in
United States certificates of deposit for legal-tender notes, $189,408,708 in
checks, drafts, certificates of deposit, and bills of exchange, $4,391,177 in
clearing-house certificates, $194,290,203 in exchanges for clearing-houses, and
$2,138,022 in miscellaneous items not classified.
Of the total receipts on that day .89 per cent was in gold coin, .32 per cent
in silver coin, 1.52 per cent in gold certificates, 1.53 per cent in silver certificates, 1.87 per cent in legal-tender notes, 1.25 per cent in national-bank notes,
12 per cent in United States certificates of deposit for legal-tender notes,
44.90 per cent in checks, drafts, and bills of exchange, 1.04 per cen, in clearing-house certificates, and 46.56 percent in exchanges for clearing-houses, in
eluding miscellaneous items.
It will thus appear that of the total receipts 7.50 per cent was in coin and
paper money, and the remainder, 92.50 per cent, consisted of checks, drafts,
billsof exchange, etc., in which is included exchanges for the clearing houses,
clearing-house certificates, and miscellaneous items.
The total receipts for the 3,474 national banks on September 17 last is stated
at $327,278,251. Of this amount $3,702,772 was in gold coin, $1,399,991 in silver
coin; -16,159,305 in gold Treasury certificates: $5,908,714 in silver Treasury
certificates: $7,665,666 in legal-tender Treasury notes: $4,371,778 in nationalbank notes: $105,000 in United States certificates of deposit for legal-tender
notes: $168,803,756 in checks, drafts, and bills of exchange; $2,428,831 in clear ing-house certificates; $126,596,873 in exchanges for clearing houses, and
$135,562 in items not classified. The relative proportions of the several items
are stated thus:
Gold coin, 1.13 per cent; silver coin, .43 per cent; gold certificates, 1.88 per
cent: silver certificates, 1.81 percent; legal-tender notes, 2.34 per cent; national-bank notes, 1.34 per cent; United States certificates for legal-tender
notes, .03 per cent: checks, drafts, and bills of exchange, 51.58per cent; clearing-house certificates. ,74 per cent, and exchanges for clearinghouses, including items not classified, 38.72 per cent.
By consolidating the several items into two classes, we fina that 8.96 per
cent was in cash and 91.04 per cent in checks, drafts, and other substitutes
for money.
W e a r e t h u s o f f i c i a l l y i n f o r m e d t h a t i n a l l of t h e c a s h t r a n s a c t i o n s of t h e n a t i o n a l b a n k s , o n l y a b o u t H p e r c e n t a r e i n
w h a t is u s u a l l y c a l l e d c a s h , i n c l u d i n g a i l f o r m s of p a p e r m o n e y ,
a n d l e s s t h a n 2 p e r c e n t a r e i n s p e c i e . I t is a l i t t l e c u r i o u s t o
n o t e t h e r e l a t i v e p r o p o r t i o n s of g o l d a n d s i l v e r i n t h i s s m a l l
amount.
O n o n e of t h e s e t r i a l d a y s t h e r e w a s i n $100, $1.13 i n g o l d c o i n
a n d 13 c e n t s i n s i l v e r , m a k i n g a t o t a l of $1.56. O n t h e o t h e r d a y
t h e r e w a s i n $100 89 c e n t s i n g o l d a n d 32 c e n t s i n s i l v e r , m a k i n g
$1.21 i n c o i n .
If t h e s e t r a n s a c t i o n s h a d c o n s i s t e d of m o r e r e a l m o n e y a n d less
of s u b s t i t u t e s f o r m o n e y , w o u l d n o t t h e b u s i n e s s of t h e c o u n t r y
h a v e rested upon a securer basis, and would there not h a v e b e e n
m u c h l e s s l i k e l i h o o d of t h e p r e s e n t c o l l a p s e in b u s i n e s s a n d g e n e r a l w a n t of c o n f i d e n c e ' ? I s i t n o t a w o n d e r t h a t t h e r e e v e r c o u l d
h a v e b e e n a n y c o n f i d e n c e i n a s i t u a t i o n w h i c h h a d so l i t t l e of s u b s t a n c e ? W h e n t h i s o c c u r r e d o u r s p e c i e w a s ; g o l d . $695,563,029,
s i l v e r , $156,908,609; m a k i n g a t o t a l of $1,152,471,638. U n t i l t h e r e
i s as m u c h as 2 p e r c e n t of o u r c a s h t r a n s a c t i o n s , o u r b a n k t r a n s a c t i o n s , i n s p e c i e , t h e r e s e e m s t o b e s m a l l d a n g e r of a r e d u n d a n c y of m e t a l l i c m o n e y .
T h e S e n a t o r f r o m N e w Y o r k [ M r . H I L L ] , i n t h e c o u r s e of h i s
s p e e c h t h e o t h e r day, d e c l a r e d himself in the f o l l o w i n g l a n g u a g e :
It will be observed from what has already been stated that the permanent
remedy for our financial difficulties is a return to the bimetallism which existed prior to 1873. Nothing else will do it. We have tried everything but
the right thing. It has been stated over and over again during the present
debate, especially in the other House, that the country has tried the experiment of silver coinage, and that it has proved a failure, and that therefore
we should now return to a gold standard. The country has not tried free
379




20
coinage since it was unwittingly abandoned in 18T3. but it has tried a limited
and restricted coinage, silver purchases, the accumulation of silver bullion,
and a depreciated currency, all of which have been forced upon the country
by monometallists through miserable compromises obtained f r o m silver
men.

T h e Senator broadly declares that the only real remedy for the
present situation is bimetallism, and bimetallism as it existed
prior to 1873. I agree with him in this, and I believe that a decided majority in this body do. Tf this is so, why do we not
promptly apply the remedy 0 I have demonstrated that our great
need is a larger volume of metallic money. A measure providing
this can be carried here infinitely easier than the pending measure. In fact, a bill for that purpose must be voted on and voted
down before the pending measure can come to a vote. Can the
Senator, after his declaration, vote against such a measure? Certainly not. How can Democrats, who profess themselves to be
friends of silver, justify a vote against that proposition? That
bill which provides for coinage of silver as the law was prior to
1873 will carry a full and complete repeal of the Sherman law.
It will be a full and complete compliance with the pledges of the
Chicago platform. These propositions are entirely harmonious.
They are thoroughly consistent, are counterparts of each other,
and neither is reasonable, logical, or Democratic without the
other. If Democrats who say they are friends of silver will vote
as they talk, we will pass this measure. W e only need their
help to make it certain. They can not vote to deny silver to the
country when they know their duty leads in opposite directions.
Every silver Sen tor in this body knows that a very large majority of those who favor the passage of this bill do so because
they believe it will be the end of silver coinage now and forever.
A few of the more courageous say so, but those who have accomplished their political purposes by indirection heretofore hint
vaguely that at a proper time the silver question will be taken
up and '' properly dealt with"—whatever that may mean. No bimetallist can justify himself in joining these people in the accomplishment of their purpose.
The people are not deceived, and it will be difficult to make
them believe that anybody is. They know that the active, leading spirits in this movement are, and have been for years, the
sworn enemies of silver. There is no promise on record from
any one of them that there shall be any silver legislation, and if
there were they would not keep it, and we all know that they
intend that there shall never be a silver-coinage bill passed"
T h e passage of this bill will place siver exactly where it was by
what was called the " gigantic fraud " of 1873. This no man can
deny.
It has been said that the Sherman law prevented the passage
of a free-silver bill in 1890. How did it do this? Not certainly
by presenting insurmountable barriers to it, not by building a
wall across its pathway: not by direct and manly opposition,
but it did it by wily and insidious means, seducing certain Senators by false hopes to join in that measure, and now those Senators find themselves stranded and deserted bv their former
associates. Senators who are friendly—honestly friendly—to
silver, who are now training with those who were responsible
for that bill, should remember this and beware.
That international bimetallism would bring immediate and
permanent relief, would give the greatest impetus to business
379




21

enterprises, would bring an era of prosperity and advancement
such as the world has never seen, there can be no doubt. But
when the obstinacy of the Brutish Government renders this impossible, we of the United States must make up our minds
whether we will complacently and humbly follow England in a
policy which will enormously swell her wealth at the expense
of all debtor nations, including our own, or whether we will, as
becomes Americans, m irk out a course for ourselves and follow
it, and be as independent in finance to-day as our fathers were
in politics a century ago.
In a recent paper, emanating from a distinguished citizen of
my State, I find the following statement:
In 1801 there were only 20,520,000 English-speaking people, 12.7 ner cent of
the dominant nations of Europe and America. In 1890 they numbered 111.
100.000, or 27.7 per cent of the same nations, an increase f r o m 12.7 per cent of
161.800.000 to 28.7 per cent of 401,700,000, a change f r o m fifth to first place.
Tney do three-fifths of all the railroad travel, and o w n m o r e than twothirds of all railroads and of the world's merchant tonnage.
Yet present conditions "give Anglo-Saxon civilization an influence vastly
greater than mere numbers and possessions would indicate.
American civilization is the potent factor in the Anglo-Saxon world. No
thoroughly civilized nation has a larger undivided area. N o nation in the
world has greater wealth, or contains within itself greater resources or m o r e
wealth-producing elements.
Its agriculture alone is capable of sustaining 1,000,000,000 people. In 1801
Americans constituted little more than one-fourth of the whole Englishspeaking population: n o w we are nearly three-fifths. While the Englishspeaking people have increased five and one-half times, we have increased
twelve times. F r o m 3.3 per cent of 161,800.000 Americans have in less than a
century become 15.6 per cent of 401,700,000. They constitute a larger part of
the civilized nations than did all English-speaking people ninety years ago.
While Anglo-Saxons have easily outstripped all others, Americans have
distanced the rest of their own blood. Anglo-Saxons lead the world; Americans head the Anglo-Saxon procession. World leadership is upon us. Are
we equal to its tremendous responsibilities?

I am an American, proud of my country, and I believe that we are
more capable of taking care of ourselves and controlling the rest
of the world than any other nation on earth. W h y should we be
dependent on Europe for financial policies any more than political? This country has set the example for much of the growth
and development which has been recently seen in Europe, and I
believe that American nations ought to stand shoulder to
shoulder in this struggle and impress American views, American interests, and American principles on the remainder of the
world. This was eloquently and wisely suggested by the Senator f r o m A l a b a m a [ M r . MORGAN] the o t h e r day.

W e h ive time after time made overtures to Europe for an
international agreement as to coinage. These overtures have
resulted in nothing.
W h y not now turn to our sister nations of the American continent and establish an American policy?
W e have already advanced a considerable distance in this direction. On May 24, 1888, Congress having psssed—Mr. Cleveland, being then the President of the United States, approved—
a bill requesting and authorizing the President of the United
States—
to invite the governments of the Republics of Mexico, Central and South
America, Hayti, San Domingo, and the Empire of Brazil, to join the United
States in a conference to be held at Washington—

In the year 1889—

f o r the purpose of discussing and recommending for adoption to their respective governments some plan of arbitration for the settlement of disa37 9




22
greements that m a y hereafter arise between them, and for considering questions relating to the improvement of business intercourse and means of direct communication between said countries, and to encourage such reciprocal
and commercial relations as will be beneficial to all and secure m o r e extensive markets f o r the products of each of the said countries."

Section 2 of said act provides—
that in forwarding the invitations to the said governments the President of
the United States shall set forth that the conference is called to consider—
*
*
*
*
*
*
*
Sixth. The adoption of a c o m m o n silver coin, to be issued by each government, the same to be a legal tender in all c o m m e r c i a l transactions between
the citizens of all the American states.

To this invitation thus tendered by the Government of the
United States there were general and favorable responses, and
the conference of American nations held in Washington was the
result. I will not now detain the Senate by any reference to
what took place in that conference, but may do so later. That,
however, is history noAV, and well known to us all; but I will
ask the Senate in this connection and at this time to consider
the recommendations as adopted by this conference, adopted
section by section by a vote of fifteen out of sixteen nations represented, as follows:
The International American Conference is of opinion that great advantages will accrue to the c o m m e r c e between the states of this continent b y
the use of a coin or coins that would be current at the same value in all the
countries represented in this conference, and therefore recommends:
1. That an International American Monetary Union be established.
2. That as a basis f o r this Union an international coin or coins be issued
which shall be u n i f o r m in weight and fineness and which m a y b e used in all
the countries represented in this conference.
3. That to give full effect to this r e c o m m e n d ation there shall meet in
W a s h i n g t o n a commission composed of one delegate or m o r e f r o m each
state represented in this conference, which shall consider the quantity, the
kind of currency, the uses it shall have, and the value and p r o p o r t i o n of the
international silver coin or coins and their relations to gold.
4. That the Government of the United States shall invite the c o m m i s s i o n
to meet in Washington within a year, to be counted f r o m the date of the adj o u r n m e n t of this conference.

W a s this Government sincere in issuing this invitation? Did
we mean what we said when we directed the President of the
United States to inform the other nations that one of the purposes
of this conference was the adoption of a common silver coin to
be issued by each government, the same to be a, legal tender in
all commercial transactions between the citizens of all the
American States," or were we simply trifling with them, as
Great Britain evidently has been with us in our conferences with
the European states?
The recent Republican Administration was hostile to silver,
and was not responsible for this conference, and, of course, could
have no sympathy with its purposes. But I respectfully submit
that the present Government is committed to it and bound by
it, and that good faith requires that we shall at once take the
lead in carrying out an agreement which was reached upon our
invitation.
A member of this body [Mr. GALLINGER], advocating the
passage of this bill, but at the same time denying that the Sherman law is the cause of the trouble, during this debate quoted
from a newspaper in his State, as follows:
Of all the senseless theories ever projected by a desperate party to account
f o r hard times the one n o w advanced by the Democracy, that banks are suspending. factories closing, merchants failing, and business generally is being paralyzed simply because the Government is adding to the circulating
m e d i u m of the country four or five millions just such coins as have been in
.379




23
use for fifteen years, and are now being taken at their face value, is the silliest. Hard times are upon us. Harder times than the American people
have seen or dreaded since 185T, and they grow harder every day, They are
hard and growing harder because a party which has declared " w a r to the
death upon protected, industries of the country " is in undisputed control of
the legislative and executive branches of the Government They will grow
no better until it is certain that this party can be turned from its purpose or
forced to stay its hand; until it is settled that the protective tariff is not to
be smashed.

I do not propose to enter into a discussion of this extraordinary statement. This editor does not seem to know that there is
no coinage taking place under the Sherman law. I agree that
it is absurd to say that the increase of the volume of money which
takes place under the Sherman law is the cause of the present
trouble; but it will be difficult to make any unprejudiced man believe that fear of being rid of a system of taxation which has
robbed every consumer in the country for more than thirty years
has produced a panic. On the contrary, I have no doubt that the
system of taxation which, after full and fair trial, was condemned
by the people last November, is in a great measure responsible
for the present deplorable condition of the country, and that its
removal will give great relief.
It has enormously aggravated the evils resulting from the fall
of prices, and these two causes, operating together and in line
with each other, have brought about the conditions essential to
the success of the conspirators who have precipitated this panic.
It has been pointed out for years that the wholesale robbery of
the masses for the benefit of the classes under the tariff laws
could not go on alwaj^s. It has been demonstrated that it would
result in absolute destruction if kept up. The goose which laid
the golden egg would inevitably be killed in time.
T h e course of the Federal Government has for thirty years bean
in almost every resp et one of gross injustice to the great body
of producers and to all the consumers of the country, and, while
we have protested against the wrong and injustice of such a
course and predicted the evils which were sure to follow, it took
years to arouse the people to decided and positive action. But
it has com - at last, and it only remains for this Congress to do
its duty to bring relief. The marvelous progress and development of our country has been the wonder of the world, and agriculture has been the great source from which this development
has sprung; yet the tillers of the soil, especially, have been by
thes - laws compelled to carry burdens which would long since
have driven any other calling but this, and any other people but
ours, to desperation.
From the foundation of our Government down to 1860 our
farmers, living under the freest government on earth, permitted
to manage their own private affairs, without direct or indirect
interference from Federal authority, prospered as no other farmers have ever prospered. Though they worked for what they
got, they got all they worked for, and this was all they needed
to make them the freest and happiest people in the world. A
great war gave the opportunity for a chang e in the laws and the
inauguration of apian to turn the wealth, especially of that great
class, into the hands of others.
The purpose of the change was at first a patriotic one—to raise
revenue—but afterwards the other and absolutely indefensible
purpose of swelling private fortunes took its place, and by the
cohesive power of public plunder held it for many years, until
379




21

the people, those who were being- robbed, were driven by their
sufferings to a full appreciation of their wrongs. This one cause,
operating alone, would in time have so redistributed the wealth
of the country as to produce general financial ruin.
The failure of farmers to meet their liabilities to local merchants and banks renders them in turn unable to meet theirs,
and so the hard conditions imposed on the farmers are felt at
last in calamities in the centers of wealth.
The inevitable result of the poverty forced upon the masses by
national laws could not be postponed always, even by the fertility and productiveness of our country, or the wonderful energy,
thrift, and marvelous self-denial of our people. The wonder is
that it has been postponed so long. The increasing poverty of
the masses, the struggle of the farmers against fearful odds,
rendered it impossible for them to contribute to the wealth of
others in their struggle for bread.
W e have a country marvelous in resources, blessed with a
salubrious climate and a people sprung from the progressive and
adventurous elements of all nations, equaled in self-reliance, energy, and determination by no people on earth. Such a people
with such a country was capable of bearing Enormous burdens
without breaking down; and, vast as was the systematic robbery of
national laws, the people might have gone on for years successful
in their efforts to make a living, and even to accumulate property
while carrying this great burden, had not those who grew rich
upon the labor of others and ate their bread in the sweat of the
faces of other people seen fit to add to their burdens in an effort
to increase their own gains.
The enormous and unjust advantages resulting from the tariff
laws was not enough to satisfy the greed of these parasites on the
body politic, and immediately upon the close of the war a systematic plan to contract the currency, lower prices, and thereby
swell their fortunes, was entered upon. Not satisfied wTith their
determination to destroy all Government paper money, they deliberately determined upon the destruction of half the metal
money.
Supply and demand regulate prices. Money is no more exempt
from this law than is anything else which is an article of traffic
amongst men. The purchasing power of money is great when
the supply of money is small and small when the supply is great.
General prices are high when money is plenty, and low when
money is scarce.
The volume of money should expand as population and trade
increases. This bill proposes to stop the small expansion we
now have, hence I will vote against it, and resist its enactment
into law as long as possible, unless it is coupled with some measure recognizing silver and providing for an expansion of the
volume of money.
379




O