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o r



H O K W . F . W I L L O O X ,

I n the H o u s e of Representatives,


24, 1892.




Free Coinage of Stiver.


H O U .

W A S H H & T O F F


W I I I C O X ,



Thursday, March 24, 1892,
On the bill (H. R. 4426) for the free coinage of gold and silver, for the issue of coin notes, and for
other purposes.

Mr. W I L L C O X said:
Mr. SPEAKER : The difference of opinion as to the unlimited use of silver
for monetary purposes is more of a local than a political question.
On all great financial and economic questions there are honest differences
of opinion among the people in the various sections of our great country,
living under different conditions and relations to business and industrial
I believe at least 90 pfer cent of the inhabitants of the Eastern States,
without respect to party divisions, are opposed to this bill. In certain of
the Western and Southern States a large element in all parties favor free
silver coinage.
Mr. Speaker, the reason for these divergent sentiments must be apparent
to most of us.
In the Eastern States there is an abundant supply of money and the rates
of interest are low, while in the West and South money is scarce and the
average rates of interest high, while their farm products are selling at prices
barely sufficient to pay the cost of production.
The necessities of the farmers, from whom the complaint chiefly comes,
West and South, compel them to borrow large sums of money, most of which
comes from the Eastern capitalists and lenders of small means, which is
usually secured by mortgages on their farms. In many instances their homes
have been taken from them by reason of their inability to pay the principal or
interest when due.
Mr. Speaker^ it is not surprising, when we reflect upon their distress, that
discontent prevails among them, and that they are ready to grasp at any
measure which they hope may alleviate* their condition. They ipsist that
there should be an expansion of the currency, which they believe will bring
to them more money at cheaper rates, and relieve them of much of their distress, and that unlimited coinage of sliver will produce this result. There is ;
a conflict between them and and the best financiers as to the effect of free
In my judgment, the passage of this bill, under present conditions, will
bring to the farmers and laboring men disaster instead of relief.

Bimetallism is favored by all classes and everywhere in our broad land, but
this cannot be brought about unless the two metals, gold and silver, can be
maintained on a parity. A silver dollar is worth only about 70 cents, and
the price of silver bullion is the same as the coin dollar. The value of bullion the world over is determined by the markets in New York and London,
in which markets the only actual difference in price is the cost of transportation from one to the other.
Silver is and has been for years demonetized in England and Germany, and
its coinage discontinued in France. These great countries refuse to recognize
it as money in their dealings with us or other nations.
Our balances on international transactions are always payable in gold, and
not a dollar of our silver can be used outside of our country except as bullion.
Our business relations with these great nations are intimate and upon
an immense scale. By reason of the telegraph and' the use of steam vessels,
which have nearly displaced the sail packets in the carrying of freights,
they have become our near neighbors, identified with us in nearly every kind
of commercial transaction.
The commerce of the world is governed by well-fixed and well-defined
rules, which have become the law of nations and which no nation can ignore
without disturbing the harmony existing, and estranging itself in its dealings
with.them. Lying at the foundation of international commerce and success
is a monetary standard recognized by all. If one country should adopt an
independent monetary standand, in conflict with that used by the commercial
world, its use will be limited to that country.
The pound sterling of England is the measure of value the world over.
All business transactions among all nations, whether between France and
China, are estimated and measured by this standard.
Silver being demonetized by the large commercial countries of Europe, and
worth only 90 cents an ounce or 70 cents on the dojlar, our silver will be
received by them only as bullion at the market price. Therefore, it must be
apparent to every thinking man that when we shall give silver full scope
by a free-coinage act we must stand alone and bear the burden without the aid
of other nations.
We shall by this act build a wall about us with every gate closed against its
going out of the country and wide open to receive the silver of the world
without the slightest barrier to prevent its coming to us, for which we will
have to pay 30 per cent above its present actual value.
Mr. Speaker, there could be no objection to such a policy if, as suggested
and desired by our Republican friend from California [Mr. BOWERS], a wall
should be built against all commerce with the outside world. Nations never
become great and wealthy by any such policy as this. Commercial dealings
with each other are to the mutual profit of all. If we are to continue our extended commerce with them we must conform to the laws of trade which govern them.
Bimetallism can not be brought about solely by a legislative act. In order
to establish and maintain it the intrinsic value of the two metals, according to the ratio adopted, must be substantially on a parity.
How can a law of this Congress raise the value of the world's silver 30 per
cent or to the equality of gold ? What kind of leverage, without the aid of
other nations, are we to use to accomplish this wonderful result ? Nothing
short of a miracle can do it.

Is it wise, safe, or honest legislation to open our mints for the reception of
the world's silver while every other country refuses to do it, paying 30 per
cent above its value ?
Who is to receive the immense profit caused by this inflation and resulting from the passage of this bill ? The answer is .easy and certain. The
silver mine and bullion owners of all nations, and the people will have it
to pay and receive none of the profits.
The mine-owners and their paid attorneys tell us the reason silver has declined in value results from the act of 1873 demonetizing it, I have no
doubt but that act had a depressing influence on the price of silver, and that
Congress committed a great mistake and wrong in passing it, as it operated
to the greater profit of foreigners holding our bonds, which, before this, were
payable in gold or silver, than it did to us, by compelling their payment in
However, Mr. Speaker, that act did not discourage the silver mine owner
or lessen his product. Never in the history of the world has the silver output
been as large in the same period of time as it has been since 1S73, though
silver has largely depreciated. If statistics are correct, and I have not heard
them diputed, they show the average cost of producing silver in this country
to be 41 cents an ounce, and the market has ranged from 89 cents to over $1
an ounce since the act demonetizing it was passed, showing very handsome
profits to the producers, and by this bill, if it becomes a law, the price will be
inexorably fixed at $1.29 per ounce.
It is apparent from these figures that the mine-owners need no sympathy or
special aid from Congress or the people.
Who is to suffer by this great inflation caused solely by a legislative act?
Somebody has to pay for it. There is only one answer, and that is the people, all who receive it in payment of debts, farm products, labor, etc.
The claim is boldly made that the people must submit to this extortion
in order to increase the volume of money for which our friends in the West
and South say there is a pressing demand.
We are told that the currency has not kept pace with the growth of population and business. This a misapprehension. The volume of money is
larger per capita now than at any time before, except the paper inflation
period of 1865, being $24 per capita. We are converting into money under
existing law nearly $20,000,000 in gold and about fifty-five millions of silver
currency annually. No one can successfully deny but that the increase in the
volume of money exceeds our growth in population and business.
There can be no foundation for the claim made, that a depression or cheapening the price of farm or other products is to be attributed to the scarcity of
Mr. Speaker, the important inquiry at this time is as to the effect unlimited
coinage will have upon the people, upon business, and industry ?
The ratio of gold to silver, established by law in 1834, is 1 ounce of gold
to 16 of silver. This ratio was based upon the intrinsic relative value of the
two metals at the time this law was enacted.
By reason of the large and increasing production of silver over gold since
intrinsic value of the two metals are much farther separated, and
to-day 1 ounce of gold is worth intrinsically 2 2 ounces of silver.
This bill does not purpose to place the two metals on a parity at the start,
but to force them to that relation by remonetizing silver.
I believe this is impossible without the co-operation of European nations.

This disparity exists in all countries in their business relations with the commercial world.
Congress might as well attempt to appreciate the value of wheat in the
markets of the world by fixing the price at $ 1.50 per bushel when it is worth
only $1 per bushel.
What, then, will be the necessary and logical result of unlimited silver
coinage ? Gold being far more valuable of the two metals, and the only
currency recognized and accepted in all the marts of the civilized worfd will
be in the greatest demand. It will be impossible to circulate the two currencies together or make them interchangeable under a free-coinage act.
Who will accept a 70-cent silver dollar for a gold dollar worth 100 cents?
Everybody having the two coins in his pocket would part with the silver first
and retain the gold until he could receive greater value for it.
The result by the passage of this bill will be to drive gold to a premium
and out of circulation, as in the days of the greenback currency, and
place us on a silver, basis. This means cheap and depreciated money, business disturbance, and disaster to all except the rich, or the gold bugs, as our
silver orators term them. They will be able to take care of themselves. When
the storm comes values depreciate and disaster follows, they will find profitable investment for their hoarded gold, which will pay them larger dividends
than loaning on Western farm mortgages.
This class are not going to suffer
as much by the passage of this bill as our opponents seem to believe, and will
not need their sympathy.
It does not necessarily follow that because the business men and financiers
are opposed to unlimited silver coinage, that they are actuated by greed and
selfishness. t Their business training gives them a knowledge of finance that
the masses in other occupations do not possess, and they can with a clearer
vision, predict the blow that will fall upon the industrial and business classes
if we shall be placed on a debased currency.
They tell us that cheaper and more abundant money will elevate the price
of commodities, farm products, etc., and make debt paying easier. This
is a great mistake which our friends labor under. The dearest money a people
can have is cheap money; that which is below the standard fixed by the commercial world.
The merchants would not find any greater profit in shortening their yardsticks one half and calling it a yard, or a farmer in reducing his bushel
measure one-half and calling it a bushel, as their customers would discover the
device and compel them to reduce prices to conform to measure. We can
deceive no one a great while by calling 70 cents a dollar or scaling down our
dollar to a 70-cent standard, and if adopted prices will be measured by this
short dollar, instead of the gold dollar of 100 cents. Such a radical change
will lead to endless confusion and disturbance and compel a readjustment of
business upon a different scale than now exists.
There may be one advantage temporarily gained by the debtor class in the
passage of this bill. It will enable them, provided they can get hold of the
silver currency, to pay existing obligations with the 70-cent dollar; or in
other words to scale down their debts 30 per cent. It will help our large
railroad corporations, the greatest debtor class in this country, to scale their
debts when not payable in gold, a considerable part of which is held by
persons of small means. But when existing contracts shall become due, it is
not probable that many will be able to liquidate them, even if we have free
coinage. They will be obliged to ask for an extension or a renewal of their

loans. The preditor will be apt to reply to such request, " I loaned you
mone) worth'100 cents on the dollar; you propose to repay the loan with
70-cent dollars. I cannot be caught in that way again, the contract of renewal of the loan must stipulate that the principal and interest shall be payable in g o l d . " This stipulation would also be required* in nearly every
T h e borrowing class will be compelled to execute such a contract or lose
the property pledged. When these new debt contracts become due where is
the debtor to obtain the gold coin from to meet them ?
T h e silver dollar
will not answer the requirements of the contract. He will then discover that
there is no profit in cheap money, and the only use he can make of it in paying his obligations will be to buy gold at a premium, corresponding to the
difference of the two metals at their bullion value.
Thus far the silver dollar has been kept on a parity with gold by limiting
coinage and giving it full legal tender power. It is estimated that if we open
our mints to the silver of the world, and this bill will do that, it will stimulate
silver mining to such an extent as tof dump into 'them at least 100,000,000
ounces ftefeJbtyr y x u j L
Mr. Speaker, it is norx>elieved by many of the best financiers that under
existing law passed by the last Congress, which places 4=5,00^,00^ounces of
silver each month in the Government vaults, that our silver dollar can long
be maintained on a parity with the yellow metal. When they do part company the cheaper money will be the prevailing currency and the other will
be retired from circulation. . This is the natural law of finance; it is the
history and experience of the past.
This bill will, in my judgment, bring no boon to the farmers and laboring
men or debtor classes. If I believed for a moment that such would be its operation I would do all in my power to have it become a law.
Whenever there is a depreciated currency the laborer will have to accept it
for his day's work and the farmer for his products.
A nation's honor and integrity is involved in maintaining sound money,
a currency that represents just what the government stamp when placed upon
it says it does, making it a legal tender for all public and private debts, an exchange for every kind of commodity.
If it represents anything less, then
it is a symbol of fraud and a cheat to everyone into whose hands it passes.
No government or people can afford to have placed upon its statute book
an act which permits and invites dishonorable dealings among the people,
and much less a great and wealthy nation whose honor and business integrity
stands as exalted as any on the face of the earth.