View original document

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















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

Mr. SPEAKER: I assume in the beginning, that which is perfectly apparent, that this is a contest against bimetallism; but
the discussion has taken a wide range, and should I depart from
the real question it will not be without precedent.
The State I represent, in part, on this floor has no mines of
either gold or silver. She has no direct interest in appreciating
the bullion value of either metal, but, in common with the greit
majority in the West, she is deeply concerned in having money
enough for the development of the resources of that country and
to supply the wants of a new and growing community.
Throughout the Western States, with the people who trade and
with those who toil and think, this money problem is the supreme
question of the hour. And these people are looking to this extraordinary session of Congress and hoping, not for contraction
of the currency, but for expaasion. They are not prepared for
contraction, for in seeking their suffrages during the late campaign they were not promised contraction. Nor have they had
any notice that this was to be the policy of the Government until
the recent extraordinary message of the President was delivered
in these halls and published to the country.

The two great national politic-il parties at their last conventions had declared in favor of the continued use of both gold and
silver as money metals without any expressions as to how much
of either was required. It was further declared that, along with
gold, silver should be treated as standard money. But coupled
with its declarations indorsing the double standard the Democratic platform contained a clause demanding a repeal of the
Sherman law, alleging that it was only a makeshift.
It was not understood, however, during the campaign that
the purpose was to repeal this statute without substituting for
it some other and better provision. In truth, the very terms of
the declaration invited the belief that there was to be a more
liberal use of silver as money. The voters generally had no
thought, or suspicion, on election day that either of th© national
parties intended, if successful, to take a backward step on the


silver question. There had been no denunciation, or dissent, in
either platform from the contention which had been going on
for years, having for its object the enlarged use of silver as
money, and the electors had no reason to believe that there was
a latent ambiguity anywhere from which the successful party
would undertake to justify itself in a policy which would result
in contraction or would further restrict the use of the white
When the national parties met in solemn convention to make
up the issues for the campaign, there seemed to be no disposition from any source to pronounce in favor of a single gold
standard or for a diminution of the currency, because the atmosphere was portentous and every one knew at the time that
such a declaration would be followed by inevitable apd overwhelming defeat to the party making it.
But when the contest was over, and before the new Administration commenced, the gravest apprehensions were aroused by
reason of the demand from high places for the demonetization
of silver.

I desire, at the outset, to call attention to certain conditions in
this country, which are doubtless understood by gentlemen here,
but do not, in my judgment, receive the consideration to which
they are entitled. The people of the Eastern St ites are in the
possession and enjoyment of the property accumulations of many
generations. They are loaning money,"and gathering interest
from every other portion of the land. They have resources developed, and have long since established the machine shop, mill,
and factory. They are producing and manufacturing every thin g
they consume; hence, the money exchanged for these commodities remains at home.
With these environments the men of large fortunes in the
East have not until recently seen the necessity for more money.
They desire to secure the largest premium possible, and understand perfectly that the smaller the amount of circulating medium
the greater the demand for loans, and the larger will be the income.
In the new West the conditions are essentially different. Her
resources are undeveloped. The psople, as a rale, began in adversity and have acquired nothing by inheritance. They have
builded homes and institutions, but the factory is not yet established. Like the settlers in other new communities they are
borrowers. It follows that they must borrow from those who
have to loan and give such security as is demanded. The farm,
already burdened with taxation, is now encumbered by mortgage. This farm is the source of all income to the proprietor and
must produce sufficiently to meet all his demands.
The products of the field are marketed and the proceeds immediately find the way to money centers in the East to cancel
coupons and to purchase and supply Western homes with manufactured commodities. There is no just ground of complaint
because of this more fortunate situation in the older States.
The people everywhere have the right to enjoy the fruits of
their rightfully acquired possessions. But in view of these different situations it is not difficult to comprehend why the West

wants increased circulation. She wants interest reduced, enterprise stimulated, and new avenues opened to business and employment.
The ratio of increase of money, under existing coinage provisions, compared with the increase of our population is slight,
so restricted that prices have not b3en maintained. But suddenly there is grave apprehension of disastrous inflation by reason
of the use of the two metals, and the demand comes to strike one
down, and this is not the mutual demand of the two classes, but
it comes alone from the creditor class and after the contracts
have been entered into on the basis of gold and silver payments.
This would change the terms of the contract, be grossly inequitable, unconscionable, and oppressive. And this threat coming
from the older States, and supported by the national Administration, is supplanting security and contentment with suspicion
and alarm.
But the real question lies beyond this. The capitalists want
a system of finance which can be absolutely controlled through
the banks, while the masses are contending for bimetallism—for
the money of the Constitution. This is tho paramount issue before the American people and will take precedence over all others
until finally settled.
We have been admonish3d all through this discussion that our
system of bimet llic money is not satisf actory to Europe. There
have been many things done here not entirely in harmony with the
vie ws of the aristocracy of the Old World. I would not, however,
underestimate the history and precedents of these great nations,
but the truth remains that the great masses of the people there
have had no voice in shaping their institutions or fixing their
policy. Their policy was fixed solely with reference to conditions and interests of the ruling classes.
Fortunately for us, the Constitution invests Congress with the
authority to coin money of gold and silver and fix the value
thereof, and give to it when so coined legal-tender functions.
No other power on earth or " among men" can regulate the value
of our coins, unless we abdicate the power given by the Constitution. But while Congress has the sole power to regulate the
value of silver coins, to destroy its money functions against the
judgment of the people would do violence to the spirit of the
Constitution and weaken confidence in democratic government.
The power is to regulate, not to destroy.

Much has been said and written by the advocates of the gold
standard about the "dishonest dollar," and yet it is true the
silver dollar is worth its face value from Maine to the Golden
Gate. The merchant when offering and selling his goods t.sks
no question as to the kind of money he is to receive. Silver is
exchangeable for any other money without discount all over the
country, and notwithstanding the efforts to depreciate ; nd degrade, the fact is worthy of consideration that many more people handle silver than gold. Silver is the money of the m isses,
while gold is the money of the few. But we hear that it is the
debtor class who demand the icontinued use of silver. Debtors
ive a right to be heard, but they are not alone in this demanJ.

It comes from the producers, from the laborers, from the mines
a n i the mill, but it is not a demand for repudiation.
The people have not the slightest disposition to repudiate their
debts. They can and will piy, with interest, that which they
owe. What they do most earnestly protest against is the constant appreciation of gold by the disparagement of silver, which
results in increasing their monetary obligations. If one-half the
basis for our circulation is to be discarded, it follows as a necessary result that the other half will be dearer and easier manipulated and controlled. The threat to do this has brought us face
to face with panic. This is the condition with which we are confront: d, and this condition is to-day retarding development,
stifling enterpris 3, and oppressing debtors. So generally has
this threatened disaster aliected all conditions and classes that
the cry of alarm has gone out from nearly every household.
For centuries the currency of the civilized world has been
based on gold and silver, but the u financiers,^ always fruitful in
suggestions and expedients, demanded a change, first in the Old
World, and it was speedily made. That we so readily indorsed
this foreign policy and adopted it by legislative enactment has
always been a matter of surprise, and has given rise to much
The law of 1873, omitting the standard silver dollar from the
coinage act, was a mistake, but there was little silver in circulation at the time, and judging from the record no one in Congress,
or out of it, foresaw the effect it would have on the finances of the
country. Since that every effort to restore silver and return to
the former system has been met with the argument that gold
would be driven out. When partial restoration was made in
1878 dire consequences were predicted. Again in 1890, when
the much abused Sherman law was enactsd, it was urged that
the white metal would soon be supreme. Notwithstanding these
prophesies the two metals are here, each jjei-forming the functions of money and each still the object of earnest desire.
W e hear it said and repeated that silver is so heavy and cumbersome that large quantities can not be put in general circulation. This will most certainly be so if the dollar is materially enlarged. But those who make this objection against silver
find no fault because gold does not everywhere freely circulate.
Gold does not and has not circulated among the masses to any
considerable extent since the beginning of the late war. It is
hidden in the vaults and few people think of it when engaged in
ordinary business transactions. Paper is growing in use in the
commercial world where large payments are required.
But the fact that coin does not everywhere circulate is immaterial in the consideration of this question. It is the right to the
use of both metals as money which is insisted upon. I believe if
this right had baen firmly established here that the recent international monetary conference would have reached a satisfactory
conclusion and silver would have been placed in business channels side by side with gold. It was the division of sentiment in
this country which gave the goldmonometallistsof Europe hope
of permanent disagreement at Brussels and which resulted in
the rejection of all overtures from our delegates.
The work of this conference and the position taken by some

of our delegates since are serving only to weaken our position
abroad. We must adopt a comprehensive and liberal policy for
the United States, stand by it, and other nations will soon come
to us. The talk of gentlemen in favor of breaking down our
policy in order to hasten international bimetallism will not deceive any one. It is not bimetallism they want, but an excuse
for destroying it.
Mr. Speaker, it is said that we should no longer try to maintain the double standard because the silver dollar does not represent a dollar's worth of labor. It is admitted here that no one
knows the actual cost of the silver product. Until recently there
were no statistics which undertook to give the cost of production,
and none now give, or attempt to give, the cost of prospecting and development. The effort has been to show the cost
only of taking ore from the productive mines. So far as the
aggregate cost of production goes, this is clearly misleading.
Everyone who has been through our great Western miningregion knows that every mountain side, where evidence of precious metal has been discovered, is literally honeycombed with
prospect holes and driven full of tunnels. These ventures do not
by any means cover the entire cost of prospecting. It is the
judgment of those who have had best opportunities for observation that the gold and silver ores produced have cost more than
100 cents to the dollar. If the facts could be ascertained and the
actual cost determined, the truth of this proposition would be
Superintendent Porter in his Report on Mines and Mining,
under the head of "Cost of Producing Gold and Silver," says:

The actual cost of production of the precious metals varies so greatly at
different mines and works that it would be imuossible to arrive at any absolutely accurate average. That one of the great gold or silver mines, when in
bonanza, earns enormous profits merely means that the cost of production
is but a small part of the market value of the metal produced. But the mirage of the widely known if not long lists of millions accumulated by fortunate owners of gold and silver bonanzas induces the investment of millions in the opening and working of prospective bonanzas that never materialize, and encourages and supports the lonely prospector in his wearisome waiting for the fortune that never comes. The spirit of the gambler
controls in great measure investments in precious-metal mines, and so far as
this class of investment goes there can be no doubt that it is, on the whole,
unprofitable: or, in other words, that the gold and silver obtained by it cost
much more than they are worth in the market.

This report further shows that when the losses are taken into
consideration " that the average cost of all the gold produced is
more than $20.67 per ounce troy, and that silver is more than,
say, $1 per troy ounce."
Mr. Porter h .is not attempted to take into account the cost of
exploration and of "dead work," and yet he has re iched the conclusion that has been reached by every other impartial investigation, that the cost of producing precious metals is greater than
the value as expressed by the coins themselves. There is not the
slightest doubt but that the silver dollar at its present ratio represents more than 100 cents in labor and necessary expenditures.

The times of 1873 to 1877, when there was only about $15 per
capita in circulation, are not forgotten. Prices went down, business was depressed, and the country was nearing the verge of
bankruptcy. Congress was appealed to, and after a struggle,

legislation was had which resulted in A partial restoration of
silver and a gradual increase of the currency. For the If st few
years we have had from $20 to $24 per capita, and the country was
more prosperous until this last onslaught was commenced on
From this time panics and business failures came one after
another, and I can not avoid the conclusion that the men who
have forced this issue are wholly responsible for the distrust,
suffering, and ruin which is sweeping over the land. The miners
in the far West, the producers in tha agricultural States, and
the laboring people in the factories are alike victims to this unjustifiable assault on half the money of the Republic.
A few weeks ago, when the balance of trade was against us
and our people were settling such balances with gold, we were
told that the Sherman law was responsible, and th-t it must be
speedily and unconditionally repealed. But the extra session
came a month too late. The gold is rapidly returning. The
silver law is still in force and the silver dollar worth a hundred
cents. Had this Congress been convened forty days earlier the
repeal would have been urged here and by the press on the sole
ground that the law was depleting the country of its gold coin,
and that we were nearing silver monometallism.
As soon as it was known that Mr. Cleveland was elected President the metropolitan p. ess commenced paving the way for an
additional issue of bonds and i'or this crusade against bimetallism
and prosperity. Editorials and interviews showing the trend of
Eastern sentiment and plainly indicative of this contest appeared
from time to time, after the November election, in all the great
The following paragraph, taken from the New York World of
December 21,1892, was significant:
The outflow of gold, which Secretary Foster so jauntily dismisses as a
thing of no consequence, is very differently viewed by man of greater soberness and more sense. It is a symptom, and there are men of serious minds
in Congress who regard it as one needing treatment. Senator WASHBURN
sees in it the natural consequence of the fact that a number of European
governments are strengthening their gold reserves. That is another way
of saying that they are buying and hoarding gold. As there are several of
them doing this simultaneously, and as all our financial administrative
methods are such as to make the United States Treasury the easiest and
most convenient source from which to get it, it is being drawn from us.
There are men in Congress who, in view of the facts and of Europe's refusal to lend us any aid whatever in the solution of the silver problem, think
the time has come when we should assert and protect ourselves by dropping
all efforts to maintain silver and proceeding at once to strengthen our own
gold reserve. It is suggested by a Senator who has not been counted as
hostile to silver that we should repeal the Sherman act—for which he voted—
and substitute for it a measure requiring the Treasury to accumulate a gold
reserve of $200,000,000, and to maintain it intact by the sale of bonds if necessary. Such a suggestion from such a source is, so far as it goes, evidence of
a tendency toward conservative reaction. The trouble is that it does not
go far enough. It is shared by far too few of our statesmen to give hope
that any earnest effort will be presently made to protect the country from
that lapse to a silver standard which the conditions of the time seem to

These two measures were at that early date mutually understood, and should they be consummated another will be deemed
necessary and will be speedily devised to dispose of all the silver,
including silver dollars, now in the Treasury, or one which will
in some way destroy the character of this metal as money.
Before leaving this division of the subject, I desire to refer

to the question of ratio, which has been discussed so ably that I
need only mention it. The silver dollar is large enough. To
essentially increase its weight would be but another form of demonetization. Outside of a few money centers, where they have
all along disparaged the use of silver, the silver coin at its present ratio, in limited sums, is preferred to other currency. The
masses car© little for the ratio. It is a convenient coin for
everyday transactions which is wanted. It would partially relieve the situation to retire the one-dollar notes, coin all our
siiver bullion at 16 to 1, pay it out for the erection of Government buildings and in prosecuting other Government works,
and thereby give new impetus to the wheels of industry.

There is no reason why gold should flow out of the country in
any considerable sums, except when there is a balance of tr^de
against us and the settlement is required in gold, or when foreign goverrments holding our bonds desire to convert them into
gold. As long as we have bonds outstanding it is possible for
either of these contingencies to happen so as to cause slight contraction, whether we have silver or not; but the common mind
can not understand how, when some part of the gold Hows out,
from any cause, conditions are to be improved by striking down
any part of the money which remains.
If all these disasters should come ujon us, that is, if silver
should be destroyed by legislation and gold disappear, there
would be but one alternative left—an irredeemable paper currency. For it is well understood that the entire stocks of gold
and silver are not now sufficient to serve the purpose of the
world's money and have to be supplemented by enormous issues
of paper.
The argument that the use ol silver will drive gold out of the
country is not new. It has been made through the press and
stated and reiterated on this floor at every session for years, and
yet gold and silver have gone on increasing.
I hold copies from the official records of the Secretary of the
Treasury showing the coin in the Treasury and in circulation
July 1, 1879, and August 1, 1893, which clearly refute all these
prophecies concerning the exportation of gold by reason of coining and using silver. I desire these statements placed in the
R E C O R D with my remarks.
Statement showing the amounts of money in the United States, in the Treasury
and in circulation, on Julyl, 1879.
[Population, 48,866,000; circulation per capita, $16.75.]
General stock
coined or
In Treasury.
Gold coin
Standard silver dollars
Subsidiary silver
Gold certificates
Silver certificates
United States notes
National-bank notes

Amount in







Statement showing the amounts of gold and silver coins and certificates, United
States notes national-bank notes, in circulation August 2,1893.
coined or
Gold coin
Standard silver dollars
Subsidiary silver
Gold certificates
Silver certificates
Treasury notes, act July 14,
United States notes
Currency certificates, act
June 8,1872
National-bank notes

In Treasury.

$520,273,567 $103,363,626
419,332,450 363,108,461

Amount in Amount in
circulation circulation
Aug. 1,1893. Aug. 1,1892.












512,869,632 1,611,099,017 1,601,949,325

Population of the United States August 1, 1893, estimated at 67,066,000; circulation per capita, $24.02.

From this data it appears that on July 1,1879, there were r i
the Treasury and in circulation $245,741,837 in gold coin, and on
August 1,1893, there were $520,273,567. To this last sum must he
added the gold bullion in the Treasury August 1,1893, amounting to $78,345,510.
However prophetic the Gresham theory may have been under
former conditions, recent history does not support the position
our statesmen assumed on this question twenty years ago. In
the light of the Treasury record showing the accumulation of
gold since 1879, is there any well-grounded cause for apprehension
to be drawn from the continued use of both money metals? The
increase in population and business demands, and will continue
to demand, a constantly incre ising circulation. Every ounce of
silver produced in the United States could be used without the
slightest danger to business or commercial interests: and even
should this Congress not so declare, the time is approaching and
not far distant when the people will decree that it shall be so used.

There is a further and more cogent reason why the use of silver should be continued and enlarged rather than diminished.
The entire gold-producing regions have been systematically prospect 3d, and it is believed that the earth's great deposits of the
yellow metal are almost exhausted.
I have here a paper, somewhat theoretical, but containing so
m my valuable truths bearing directly upon this question, that I
ask to have it read from the Clerk's desk as a part of my remarks.
The Clerk read as follows :
Gold getting scarce—the supply running out all over the world—probable
that enormous masses of the precious metal are gathered about the center
of the earth—why it is rare. 44 How is the world going to get along when all
the gold has been exhausted?" said a metallurgist to a Washington Star
writer, interrogatively. " There is no joke about it. The gold production
of the world is steadily decreasing from year to year, and it will not be very
long before the supply is practically used up. Not more than $100,000,000
worth of the precious metal is now miued annually, and this is not
nearly enough to meet the requirements of expanding commerce. Of course,

200deposits will be discovered from time to time, but

they will soon be exhausted.
Why is gold so rare? Simply because it is heavy. There are only two
metals that are heavier, namely, platinum and iridium. Remember that
at the beginning the earth was a body of gas. By gradual condensation it
became liquid, while now the whole of its mass, save only an outer crust,
much thinner in proportion to the whole bulk than is the shell of an egg,
would be a fluid but for the fact that it is held together by tremendous pressure. Naturally, in the course of its formation about a center of attraction,
the weightier particles composing the globe gathered about that center.
Accordingly we find that the earth, as a whole, weighs five times as much as
water, while the rocks forming the crust are only about two and one-half
times as heavy as water.
From this it is evident that the materials composing the globe near its
center are very heavy, and it is to be presumed that they are chiefly, if not
wholly, weighty metals. Gold and platinum being, with only one known
exception, the heaviest metals existing, it seems highly probable that enormous masses of these precious substances are gathered about the center of
the earth. What a pity it is that such colossal treasures should remain forever inaccessible to greedy mankind! At all events it is unfortunate that
more gold is not to be discovered on the surface of the planet, because no
other metal is equally available for use as money.
One naturally asks how it has happened that any gold and platinum
are found on the surface of the globe. The answer is very easy. Both of
these metals are always discovered among rocks which have been upheaved
by volcanic or other causes out of the interior of the earth. Platinum, which
has only been found in abundance near the Ural Mountains, comes from serpentine. a rock thrown up from the depths. Gold occurs chiefly in quartz
veins. When the earth was contracting, great cracks were formed, and
these were filled from below by the action of hot springs or otherwise with
gold-bearing quartz. Occasionally this quartz contains so large an amount
of the metal that the vein is called a " bonanza."
But such deposits are soon worked out and fresh regions must be resorted to for supplies of gold. Thus the available mines of the world are
being rapidly exhausted. They are usually discovered at the extreme limits
of civilization. In ancient times gold was obtained abundantly from the
rivers of Asia. The sands of Pactolus, the golden fleece secured by the Argonauts. the yellow metal of Ophir, the fable of King Midas, all illustrate
the eastern origin of gold. Alexander the Great brought nearly $500,000,000
of gold from Persia. Gold also came from Arabia and from the middle of
Africa by way of the Nile. But all of these famous sources of supply were
long ago exhausted.
Likewise Brazil, which only a century ago was the richest of gold-producing countries, has now ceased to be largely productive. The total output
of the metal from that part of the world from the end of ti*^ sixteenth century until now is estimated at $700,000,000. All the famous gold coast of Africa does not at present yield as much as 1400,000 a year. Yet the dark continent was formerly noted as the country of gold. Mummies have been numerously found in Egypt with massive necklaces and other ornaments of
the metal. Herodotus tells us of a king who loaded his prisoners with golden
chains, t,hat substance being more common than bronze. Copper was even
worn for ornament in preference to gold. The treasures brought by the
Queen of Sheba to Solomon's Temple must have been of enormous value.
Since the year 1500 Africa has produced about $600,000,000 worth of gold; but
the supply is nearly used up now.
The supplies of gold drawn from the United States are steadily diminishing. It is the same way with Australia, which has yielded for the world's
use about $1,300.000,000 worth of the metal. Not less than $7,000,000,000 of gold
has been dug in all countries since Columbus discovered America, four hundred years ago. The amount is vast, but to produce it seems to have pretty
nearly used up the available deposits. The time is nearly approaching when
the yellow metal will be hoarded much more than it is at present, and we may
reasonably expect that it will attain before many centuries are past a value
several times greater than that which it now possesses.

Mr. BRODERICK. Owing to the manifold and wonderfully
improved machinery for mining and smelting there has been a
slight increase of production of gold for the last few years, hut
all the authorities concede that there has been a substantial decrease in the world's production since 1860, while its consumption in the arts has been enormously increasing. Indeed, most,
if not all, of the annual product is now consumed in the arts.

Some are frank enough to admit that with the constantly expanding commerce there is not sufficient gold to transact business
and settle balances. Y e t in the face of these facts and concessions the income classes are everywhere exerting themselves to
diminish the currency and to increase the value and purchasing
power of their money. Should the silver law be unconditionally repealed gold will appreciate and the price of all other
properties and commodities will depreciate.
It is impossible to say just how much monsy should be in circulation because it depends on many conditions. W e do know
that the volume of money is now insufficient. But it is said that
after the repeal of the Sherman law the dem .nds for an increasing circulation will be met by allowing the State or National
banks to issue currency. If this is the plan, then you propose
to destroy the great mining interests of the country, upon which
millions of people are in some way dependent, to help a class
that is amply able to help itself. You foster and perpetuate a
system which has served its purpose: a system once useful, but
for which better methods for supplying the country with paper
money have been devised—the issuing of legal-tender notes by
the General Government based upon gold and silver.
The gentleman from Ohio [Mr. HARTER] said the other day
on this floor, with much earnestness, that the Sherman law was
passed by a Republican Congress and approved by a Republican
President. I am glad the law was so passed, but hardly think
the statement of the gentleman will be accepted by the country
as a good reason for its repeal. It was the best measure which
could then be enacted, and is infinitely better than anything this
Congress will do toward bimetallism. The vice is not so much in
the law as in the execution, When, a few months ago, the New
York bankers organized to deplete the Treasury of gold through
the presentation of Treasury notes, had the Secretary of the
Treasury redeemed each obligation by paying one-half in gold
and one-half in silver, as the law clearly authorized, the run would
have been discontinued in twelve hours.
Mr. Speaker, this contest will not be settled here at this time.
The question of whether we shall continue the use of the two
precious metals as money is one of the most momentous issues
now before the country. It is a question in which all classes,
especially the industrial and debtor classes, are intensely interested. It was obscured during the last political campaign, except in a few States, but it can not again be thrust aside and
hidden from view.
No man could have been elected President in 1892 on a public
declaration of the doctrine announced in the late message. The
people are in earnest and will not again be deceived. They are
now beginning to read and understand the signs of the times, and
when they witness, as they may in this land of ours, the setting
up of the " golden calf and hear the edict from the supreme
authority to worship at its shrine, discussion will be renewed at
every fireside, organization will follow, the golden image will
be hurled from its pedestal, and political leaders who have deceived the people will be driven from their places as the moneychangers were driven from the Temple. [Applause.]