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HON. W I L L I A M B A K E R ,














B A K E R .

The House 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"—

Mr. BAKER of Kansas said:
Mr. SPEAKER: There is quite a diversity of opinions in regard to the causes which have led to the conditions which confront us at the present time. They are not the work of a single
day or a single year, hut the result of a carefully laid .plan thoroughly and intelligently executed.
While other factors have entered into the general scheme, the
contraction of the currency of the nation has been the chief cause
of all this distress and disaster.
In 1866 there was $1,863,409,216 of currency, exclusive of gold,
silver, and State-bank issues, being used as a circulating medium
by 35,819,261 people, making an average of $52 per capita. Tiiis
amount of currency was composed of the following:
One-year nates of 1867
Two-year notes of 1868
Compound-interest notes
Seven-thirty notes
Temporary loan, ten days
Certificates of indebtedness
United States notes (greenbacks)
Fractional currency
Gold certificates
National-bank notes


Of this amount $1,289,967 ,442 were interest-bearing obligations.
The funding act of April, 1866, empowered the Secretary of
the Treasury to call in these interest-bearing notes and fund
them into 5-20 6 per cent bonds. He was further authorized to
call in and destroy $4,000,000 of United States notes or greenbacks each month. From the date of this act to June 30, 1869,
bonds to the amount of $1,095,162,000 had been issued and
$77,018,837 of greenbacks had actually been burned up. In this
manner the circulation had been contracted from $1,863,409,216
in 1866 to $691,028,377 in 1869.
In the meantime business failures had increased from 495,
with liabilities of $8,579,000, in 1864, to 2,780, with liabilities of
$96,666,000, in 1868. Because of these increased failures the law
of February, 1868, was passed, which forbid the further destruction of the greenbacks.

At this time the question of the kind of money these bonds
were payable in began to be agitated. The contract on the bonds
declared them payable in lawful money, which at that time was
gold, silver, and paper money.
A bill was passed March 18, 1869, known as the public credit
strengthening act, which declared these bonds payable in coin.
This act took from the people one-third of their means of payment and changed the contract of the public debt from lawful
money to coin. As coin was then at a premium, this act added
fully $600,000,000 to the burden of taxation. The act of July 14,
1870, refunded this enormous debt into ten, twenty, and thirty
year bonds, bearing 5, 4i, and 4 per cent, respectively, payable
in coin. Having refunded this great debt and thereby placed
future generations under tribute, the next step in the conspiracy
was to make it all payable in gold alone. This was accomplished
by the act of February 12,1873, which stopped the coinage of the
standard silver dollar, and the act of June 22, 1874, which demonetized it. With the passage of these two acts the entire
bonded debt of the nation, principal and interest, became payable
in gold a]one.
Not being satisfied with this, these conspirators forced through
Congress what is known as the resumption act, passed January
14, 1875, which provided that specie payments should be resumed January 12, 1879. Immediately after the passage of the
resumption act, the fact that silver had been stealthily demonetized in 1873 became known. A general burst of indignation
went up all over the land, which assumed such proportions as to
frighten Congress, and compelled the enactment, in 1878, of
what is known as the Bland bill, which obligated the Secretary
of the Treasury to purchase and coin not less than two nor more
than four millions of silver dollars each month.
During the same year the further retiring of the greenbacks
was prohibited.
On July 14, 1890, the present silver law was passed which compels the purchase of 4,500,000 ounces of fine silver, to be paid for
in a new issue of legal-tender Treasury notes. Briefly, the above
is the history of our currency laws since the war. It will be noticed that the contract oetween the people and the bondholder
has been changed twice, and each time against the interest of
the people and for the profit of the bond-owner—first, payable
in lawful money, which was gold, silver, or paper; second, by
the strengthening act, made payable in coin—gold or silver;
third, by the demonetization of silver, made payable in gold
alone. Meantime, gold was appreciated in value to such an extent as to more than double all indebtedness.
Is it strange under such conditions there are those who object
to the passage of the present bill, which strikes down one-half
of the metal money of the country and will again double the
value of gold?
The statistics of the past twenty-eight years prove the following proposition beyond a shadow of a doubt: First, that the per
capita of currency has been materially lessened. Second, that
the business of the country and the uses for money has quadrupled during that time and that bankruptcy land failures have rapidly multiplied in consequence of it. Third, that the national

debt during that time has been increased instead of being diminished.
The volume of money as I have given it has been carefully
compiled from the reports of the Comptroller of the Currency.
The fact is overlooked or ignored by the partisan that certain
stringent laws are on the statute books which specifically demand that certain portions of this currency must be locked up
and held as a reserve, hence not in any sense in circulation, and
that other portions have been lost, destroyed, or sent out of the
country, or used for other purposes. W h e n proper deductions
are made and reasonable allowances given for factors which conspire to reduce the amount in circulation, we believe the following table will prove substantially correct:
Circulation pi




35,819,281 $1,863,409,216
36,269,502 1,350,949,218
528, 524,267



A s a logical result of such a rapid contraction of the circulating medium the following table of business failures is given:

Number. Liabilities.



$17,625,000 1879
47,333,000 1880
96,666.000 1881
63.69< 000 1882
75,054,000 1883
88,242,000 1884
85,252,000 1885
121,936,000 1886
228,499,000 1887
155,239,000 1888
201,000.000 1889
191,117; 000

Number. Liabilities.


161,332 3,919,394,824

By comparing this table with the one that precedes it, it will
be found that the number of failures have kept even pace with
the reduction of the volume of the currency.
And now, Mr. Speaker, has the result of ourfinanciallegislation been a success? Was it necessary for a hundred and sixtytwo thousand business men to pass through the horrors of
bankruptcy and suffer the torture which always awaits such conditions? Or that four billions of hard-earned property should
be unnaturally and wrongfully transferred from the debtor to
the creditor class on account of an inadequate volume of money ?
Is our nation the stronger for this trying ordeal in order to
make United States bonds bear a premium?
Feeling that I have established the truthfulness of the two
first propositions laid down, I shall now proceed to establish the
truth of the third proposition, that the national debt during
that time has been increased instead of being diminished:
The national debt as given by the Secretary of
the Treasury in 1866 was
Paid on principal
Paid as interest
Paid as premium

1, 756,000,000

Total paid


Amount due 1893
Had this debt been contracted payable in wheat it would stand
as follows:
In 1866 the entire debt could have been paid
bushels of wheat- _ 1,007,000,000
Paid on principal
Paid as interest
Paid as premium


1, 986.000,000
2, 974,000,000




Amount due 1893
Had the debt been contracted payable in cotton it would stand
as follows:
In 1867 it could have been paid in full with, bales
of cotton
W e have paid on principal
W e have paid as interest
W e have paid as premium
Amount paid to 1893
Amount due 1893

bales of cotton-.

58,760J 000

It now requires nearly two and one-half times as much cotton to
pay the debt as it would the entire debt in 1867.
If the s^rne principle holds good in private indebtedness as it
does in public, then Mr. A, who mortgaged his farm prior to

1872 for one-half the purchase money, who has worked hard and
economized closely to lessen his indebtedness, finds himself today more in debt, when measured by the remuneration received
for his own efforts, than when the debt was contracted. In order
to show that money has become dear and the products of labor
cheap in the last twenty-eight years, I will give the following
Mr. A is a banker, Mr. B a capitalist, and Mr. C a farmer.
Mr. A invests his money in government bonds, Mr. B places his
in a savings bank and allows it to remain idle. Mr. C invests his
in wheat and puts it in a granary. At the end of twenty-eight
years we find their investments would be about as follows:
For each dollar the banker invested, with principal and interest, he can buy to-day ten times as much of the product of
farm labor as he could in 1865.
The capitalist whose money has lain idle in the savings bank
can buy four times as much of the product of farm labor, while
the farmer realizes less than one-third of the original price for
his wheat.
By these illustrations we can readily see the causes that have
been at work in this country; that has effected the great change
in the financial condition of the laborer and the capitalist.
He who will carefully study the legislation we have had on
the money question and the effects w^hich have followed in the
wake of such legislation, in the face of history will be forced to
this conclusion, that nearly all the legislation we have had has
been in the interest of the creditor class and against the debtor
class, or in favor of the moneyed class against the laborer.
There are two great classes at this time demanding recognition and action of this body. One is the debtor, the other the
creditor class. • One finds that their burdens are too grievous to
be borne; the other is demanding an additional pound of flesh.
One comes from the home-builders of our nation, the other
from those who are absorbing the wealth of the toiling millions.
Realizing the great benefit they received by the contraction of
the currency in the first few years after the war, the latter class
are now demanding that greater sacrifices shall be made at their
behests; that silver shall be fully demonetized, that the basis
upon which all our debts have been contracted shall be destroyed.
They have much to say about the 50-cent dollar, but they have
nothing to say about the 40-cent wheat, the 5-cent cotton, the
15-cent corn and wool. They have nothing to say about the
sheriff's vain efforts to sell the homes of the people at from onethird to one-half what they brought a few years ago. They have
much to say about the honest dollar.
Pray, what is an honest dollar? Is it not the dollar of contract? Deceive not yourselves by this cry of honest dollar. The
American people are aroused to the true situation. You despise
the honest dollar which is the dollar of contract, and by legislation have sought to debase it and destroy its legal tender in
payment of debts contracted when it was one of the basic metals.
If you are honest in the use of both the metals, as you say you
are: if you wish to strengthen the public credit and the credit
ot all our people, do as was done in .1834, reduce the amount of
gold in the gold dollar, and make its commercial value the same

as that of the silver dollar. There was a perfect consensus of
opinion at that time by such, men as Webster, Clay, Benton,
Wright, John Quincy Adams, and many others that I might
mention. They all agreed that if any change was made, it must
be done by reducing the value of the dearer metal.
Benton said as soon as that was done gold began to flow in
the country through all the channels of commerce, old chests
gave up their hoards, the mints were busy, and in a few months,
as if by magic, currency banished from the country for thirty
years overspread the land and gave joy and confidence to all
the pursuits of industry.
Is this an age of advancement or of retrogression. Are we seeking to formulate laws in harmony with the spirit of the age, or
are we seeking by class legislation to confiscate the property of
our home-builders and build up a moneyed aristocracy in our
midst? These are questions, gentlemen, that are forcing themselves upon the consideration ol this House, and alarming the
people of this country. History teaches us that England by the
demonetization of silver confiscated four-fifths of the landed
property of her country, and made beggars of one-tenth of her
people. Shall we, with the light of history before us, yield to
the demands of the moneyed aristocracy of our own country and
that of Europe, follow in her footsteps, demonetize silver, reduce
one-half of the basis upon which the currency of this country
rests, and thus confiscate the homes of our people?
The righteous judgment of mankind says no.
Alison, in his History of England, uses this language:
A considerable contraction of the currency, to the extent of, perhaps, onethird or a half, at once adds a third or a half to the real amount of the whole
debt, public and private.

Can it be possible that this House is ready to force this additional burden upon our people?
He also says that—
All attempts to pay off a .public debt contracted under high prices and
during an exuberant currency, when the currency has been contracted, and
prices have in consequence fallen, will be found to be difficult, if not impossible.

W e are brought face to face with conditions which we feel to
be very unfortunate. On the one hand we have riots of the starving poor; on the other, failures of banks and general suspension
of business and a million creditors demanding their pay of
twenty millions of debtors who are unable to meet their obligations.
The nations of Europe have had just such experiences as we
are now passing through, and instead of changing the conditions
that brought that unhappy state upon their people, they increased
their elements of destruction that they might the further subjugate the masses of the people.
With the proposed demonetization of silver and the reduction
of the volume of money in circulation, with the increase of our
population and additional demands for the uses of money, owing
to the increase of business interests, we will be forced to follow
still further the example set by Europe.
She has strengthened her arm of oppression to a degree unparalleled in the history of the world.

I submit the following table for the careful consideration of
thinking people:

[La Question Sociale, Bordeaux.]
Throughout the whole of Europe, even in the smallest states, people speak
of nothing but the increase of the arm iment. This madness has even taken
hold of nations which, from their geographical position, are not in danger of
an attack at all. To give our reaiers an insight into the tremendous armaments of Europe, we append the following statistics compiled by Captain
Molard of the (French) general staff, showing the increase of the European
armies since 1869. and strength to which they will be increased when the new
plans are carried out:
Sweden and Norway

Number of men.


In future.
19 OO O
.C . O

There is not a member on the floor of this House but knows
that if we follow the financial legislation of Europe we must
also imitate her in the increase of our army and navy. L e t us
throw off the domination of Europe and actlike free Americans.
Can it be possible that this House will further destroy the use
of silver, reduce the volume of money, and change the form of
contract upon which $32,000,000,000 of indebtedness has been contracted.
No, no; let us alike keep faith with both debtor and creditor.
Let us ignore the demands of the creditor class and create a sufficient volume of money that the debtor may be enabled to pay
his debts. H e asks for no favors, but he demands justice.
I will not longer claim the attention of this House at this time,
but will adopt as my sentiments and arguments the speech delivered by Gen. A . J. Warner at Chicago, August 1, 1893. He
A most extraordinary condition of affairs meets the assembling of this convention. Almost profound peace prevails over the world. The harvests are
bountiful; there is enough and to spare, and yet never before in the history
of this country has there been such widespread fear and distrust; never before such a loss of confidence and destruction of credit. Industries everywhere are breaking down, and laborers by tens of thousands are thrown
workless on the streets, with want staring them in the face. Trade is stagnant, and business of all kinds is in a state of semisuspension. Scores of
banks, most of them prudently managed, and showing as they close their doors
assets which, under ordinary circumstances, would place them above suspicion. are driven into suspension.

There has been a reported shrinkage in the value of stocks in this country
since the break in the market of $1,000,000,000. and perhaps twice that in real
estate and other holdings, and a ruinous fall in almost all products. Nor is
this shrinkage in prices confined to this country. It extends to all goldstandard countries, and in some parts of the world has been more violent
and destructive than in the United States. The shrinkage of stocks in London. since the closing of the mints in India, is estimated at $1,000,000,000. Altogether, thefinancialsituation is unparalleled.

There must be some adequate cause for such a general depression in the
financial condition. To attribute this condition of affairs to the present
silver-purchase law in the United States would be to magnify a mole hill
into a mountain, even if the law were not in itself beneficent. Under this
law, since July 14,1890. about $150,000,000 have been added to our currency.
Does anybody believe that the presence now of this $150,000,000 in our currency produces the present money famine or makes money scarce and dear?
Would we be better off if this new money should be dropped out of our currency, or if it had never been issued ? Besides this $150,000,000, issued under
the act of 1890, we have $400,000,000 of silver, or paper representatives of silver,
making altogether $550,000,000 of silver coin, silver certificates, and coin notes.
The gold-standard men have fought this money at every step, as they are
nowfightingthe present silver law. Suppose none of this money had been
issued, what would be our condition now? Would it be better than it is?
This volume of silver and paper representatives form nearly two-fifths of
our entire volume of money. What would be our situation now without it?
No, gentlemen, to attribute the presentfinancialcondition to the so-called
Sherman law implies a state of ignorance that exists, so far as I know, nowhere outside of the banks, the chambers of commerce, and boards of trade,
that reiterate, pro forma, such declarations. If gold has been drawn from
the Treasury by presenting coin notes, issued under the act of 1890, the fault
has been in the execution of the law and not in the law itself.
The bullion has not been coined for the redemption of the notes, as required
by the third section of the act, and the Secretaries of the Treasury, by giving the holders of these notes the right to demand gold, have made it possible for gold speculators to get gold from the Treasury of the United States
easier than from any other source: otherwise this part of our currency has
had no more effect to expel gold than bank notes, or, for that matter, an
equivalent volume of bank credits. The "object lesson," therefore, so far
as it was intended to make the Sherman law a scapegoat, has proved a dismal failure. The real "object lesson" is a very different one from that
which the gold conspirators intended. It enables us to see the beginning of
the shrinkage in prices that must take place in order to go to a purely gold
It is true that the shrinkage necessary to come down to the single gold
standard has but just begun; but it is enough to show what must take place
if the world's wealth is to be measured by gold alone. It is enough to show,
if gold is to be the sole measure, what property must come down to. Five
billions will not measure the shrinkage of stocks, nor twicefivebillions the
shrinkage of real estate and other property that must take place before they
are brought down to the compass of the single gold standard.
The difference between measuring property by gold and silver together
and gold alone will be found to be much greater than most people calculate.

One thing, however, will not shrink; evidences of debt: they must be paid
in the same number of dollars, though the dollars be doubled in value. If
the world's wealth be $300,000,000,000 and its debts $100,000,000,000, it is easy to
see what doubling the dollar means. It is playing for the world. Double
the world's debts and the owners of the debts will own the world—
" The great globe itself,
Yea, all which it inherit."

It is a plot, that one would think onlyfiendscould engage in. But evidence
is abundant that no less a scheme of plunder than this was conceived after
the close of our war, and the conspiracy was concluded on the close of the
Franco-Prussian war. All that was needed to accomplish the spoliation of
the world was to change the money standard from gold and silver to gold

The value of the money standard may be doubled, either by doubling the

weight of standard coins or by destroying half the metal out of which coins
can be made. While the one method is open and above board, the other is
stealthy and deceptive: but the one is as effective as the other. Hence the
establishment of the single gold standard is equivalent to putting the value
of two dollars into one; it is doubling up the money unit and cutting property down one-half. To do this, and still require the same numberof dollars
in payment of debts and taxes, is to ordain public robbery and to sanction
by law the spoilation of one class by another; and to talk of such a standard
as-'honest money," or of such policy as • sound finance," is the rankest
Moreover, such a policy necessarily paralyzes industries, discourages enterprise, renders trade profitless, makes tramps of laborers, and creates conditions under which industrial activity and social contentment are impossible.
To wantonly produce such a condition is a public crime. But this is the
meaning of the movement inaugurated in 1873, and is the condition we are
approaching now.
How the United States could be ensnared into such a plot in 1873 can be
explained in but one way. The people were taken unawares. In 1873 we
were using neither gold nor silver. A11 debts then existing had been created
in an inflated paper currency. No direct step had yet been taken towards a
return to specie payment. Gold and silver were the money of the Constitution. Free coinage of both metals had existed from the foundation of the
Government. The option to pay debts in coin of either metal had always
been exercised both by individuals and by the Government.
Bimetallism is the right to the unlimited use o both metals as money.
Wherever this right exists the bimetal'ic standard prevails, whether both
metals are at the same time in use or not. It is, therefore, untruthful t:>
claim, as we now so often hear, that the United States never had a bimetallic
standard. The bimetallic standard prevailed continuously from the adoption of the Constitution to 1873, and when the press persistently declares, as
it has recently been doing, that we never had any other but the gold standard in the United States, and that the act of 1873 did not in fact change the
standard, and that this act was passed after full discussion in both Houses
and with the full knowledge of the people, it lies as only a million-tongued
press can lie!
The truth is, not forty people out of 40,000.000 in the United States knew of
the act at the time. Not a man, it is safe to say, then or now connected with
the press knew of it. A previous bill reducing the dollar to the weight of
the French 5-franc piece had been somewhat discussed, but the substitute
for this bill, which became the act of 1873, passed the House under suspension
of the rules, without debate, and without being read. In the Senate there
was not one word, either in the explanation of the bill or in the brief debate
that followed, to lead anyone to suspect that it demonetized silver. On the
contrary, the explanation of Mr. SHERMAN on calling up the bill bears evidence of covert intention. Not a member of either House from the great
State of Illinois, it is safe to say, knew the bill demonetized silver, and I do
not believe a single citizen of this State knew it. Senators from the most
important States in the Union did not know it. The Speaker of the House
did not know it. The President who signed the bill did not know it. Mr.
Kelley, chairman of the Committee on Coinage, Weights, and Measures of the
House, did not know it. Of all this and much more we have incontrovertible
Here was an act fraught with consequences more disastrous to human welfare than any in thefinancialhistory of the world, literally sneaked through
the Congress of the United States; an act that surreptitiously increased all
rivate obligations and well-nigh doubled the cost of the war. The rebel-

Son cost dearly enough, but history will not deny that the head of it possessed
integrity and was unpurchasable. But the generations to come will never
believe that the only man in the Senate of the United States who knew that
the mint act of 1873 contained the provisions that demonetized silver, if he
knew the meaning of it, was THE CRIME OF 1873.

This plot to destroy half the world's money and double the value of all
evidences of debt, will be known in history as the crime of 1873. If ever men
appear as whited sepulchers they are such who, after perpetrating this crime
upon the people of this country, now parade as advocates of '4 honest money.''
Let their memories rot in oblivion.

The purpose of the act of 1873, in conjunction with steps in other countries
having the same object in view, was to demonetize silver metal and, at the
same time, reduce existing silver coins to the status of subsidiary money
and thus tofinallyestablish, at least for the nations of Europe and for the

United States, the single gold standard. This purpose was in part frustrated
by the action ot the Latin Union states, but chiefly by the act of 1878 restoring the silver dollar to limited coinage and full iesal tender in the United
States. This lawstood as the principal barrier in the Western world against
the consummation of the conspiracy of 1873. until repealed by the so-called
Sherman law of 1890.

Until a month ago this law in the United States, and open mints in India,
stood as double bulwarks against the absolute overthrow of silver and the
complete triumph of the gold conspiracy.
There has been no cessation in the assaults upon these two barriers against
the full consummation of thefgold conspiracy of 1873. The same interests,
the same forces, the same conspiracy directed the attacks on free coinage
in India and on the Sherman law in the United States. Their object could
not be fully achieved without the mints of both countries were closed to silver. It was believed that one could not stand without the other. The action
of the American Congress was considered doubtful. The closing of the
mints of India was at any time in their power. There was no Congress
in India to act, nobody to consult'. An order in council was all that was
necessary, and the order of June 26 was made and the London papers
announced at the same time that -Of course the effect will be severely felt
in the United States and Mexico and wherever silver mines abound: and
the American Congress will be bound to expedite its actions in consequence."
'' The American Congress will be bound:'' Who has bound it ? The same
power that struck the blow in India, the gold clique of London? Will Congress thus be bound ? We shall see. At one blow 30 per cent was added to
the debt of India. By a stroke of the pen of the secretary in council for
India the silvefr mines of half the globe were closed, and prices are overturned as if by an earthquake shock. No other country was advised with,
no interests were consulted but those to be benefited by the act; if they
gained who might lose was of little concern. I refer not to industrial England, which suffers in common with the rest of the world, but to bond-holding, Semitic England.
If the Sherman law is repealed, the last support of silver is removed; the
stbarrier against the establishment of the single gold standard is broken



What will he the consequences, immediate and remote?
Gold is now supplemented in the United States by $550,000,000 of full legaltender silver on the ratio of 16 to l. or paper supported, dollar for dollar, by
silver coin or silver bullion; in Europe by $1,100,000,000 of full legal-tender
coin on the ratio of 15b to 1; and in India by $1,150,000,000 in rupees on the
ratio of 15 to 1. If the Sherman law is repealed and all mints are closed to
silver, this metal may fall to 50 cents an ounce or less. At 50 cents an ounce
the bullion value of an American dollar will be 38 cents, the value of the
5-franc piece 35 cents, and the value of the rupee 16£ cents. Does anybody
with competent understanding of what is involved believe that this mass of
silver money can be retained permanently in circulation as a value currency ?
When full-weight coins, legal tender for 100 cents, can be fabricated for 38
cents, or 5-franc pieces for 35 cents, or rupees for 16| cents, will they not be
fabricated? Rupees are current over nearly all Asia. If they remain full
legal tender they will be struck elsewhere than at Bombay or Calcutta. So
with American dollars and 5-franc pieces. It will be impossible to permanently retain this mass of coined silver as an inconvertible value currency
In that form it is little better than so much inconvertible paper on which
has been conferred the power of legal tender.

Thefirststep will be to limit its legal tender. When this is done it must
be made redeemable in gold. The metal might as well then be sold for what
it will bring, and only the paper representatives retained. It will be no
longer in fact a value currency; and it would be far more economical to
use paper for a mere inconvertible currency. Each of the States of the Latin
Union, by the terms of the compact, must redeem in gold its own coin held
by the other States of the Union. This they would undoubtedly be called
upon to do to the ruin of the weaker members.
The repeal of the Sherman law means, therefore, an enormous cutting
down of what is now standard or basic money. Can this be done and the
present fabric of credit stand? You might as well expect this building to
stand with half its foundation taken away.
But confining ourselves for the present to the United States, we have,
perhaps. $450,000,000 of gold, all told, not more; we have of full legal-tender

silver, or paper represent ative, f550.000.000. This is now all standard money.
On this foundation of primary money of. say. $1,000,000,000, all other forms
of currency and our entire fabric of credit now rest.
Let us put this in a form that all can understand. Gold and silver as
money of ultimate payment, or redemption money, $1,000,000,000; greenbacks and national-bank notes to be redeemed, $500,000,000; bank credits in
the form known as deposits (confidence money), $4,500,000,000. In other
words. $1,000,000,000 of money to redeem with, and $5,000,000,000 of credit and
currency to be redeemed on demand, or 5 to 1. But of this $1,000,000,0 -0 of
primary money, a large part is held in the hands of the people, and is not
available for the redemption of bank credits. Really, only the reserves of
the banks are held ready for the redemption of bank credits, which makes
the showing far worse: but the point 1 wish to bring out is the necessary
consequence to the volume of credit, and to prices of reducing the money of
ultimate redemption to gold alone.
Does anybody suppose as large a volume of paper money and bank credits
can be maintained on a basis of only $450,000,000 of gold as on a basis of $1 .000,000.000 of both gold and silver? It is simply impossible. Credit must be
something more than wind. To give credit standing there must be not only
the promise to pay, but the ability to pay when demanded; confidence can
not otherwise exist; hence, there must be some safe relation, some recognized proportion between credit currency or credit devices and the money
in which they are redeemable.
While 1 to 4 or 5 may be safe, it does not follow that 1 to 8 or 10 is also
safe. Hence, nothing is plainer than that, if the basis of our credit fabric
is reduced to gold alone, the credit fabric itself must be enormously reduced with consequences to prices and business better imagined than described.
The claim so often reiterated that 95 per cent of the business of this country is done by means of credit devices, and therefore that little importance
attaches to the quantity of actual money, is a mischievous error. The above
figures compass the entire volume of money and credit by which all cash
transactions are performed. None are performed but by one or the other of
these agencies—either by actual money or confidence money, in the form of
bank credits, drawn upon by checks or drafts. The relative proportion of
legal-tender money and bank credits is as $1,500,000,000 to $4,500,000,000, or
4tol: but the proportion of reserves to bank credits is, on the average,
nearer6or7to 1; and this is what, in modern parlance, is called "sound
If the efficiency, dollar for dollar, of money and bank credits, were equal,
the proportion of work performed by each would be as four to one, but the
one form is the same from day to day and year to year, the other exists today and is extinguished to-morrow. The efficiency, therefore, of a dollar of
actual money is probably two or three times that of bank credits, and in
times like these, four orfivetimes. And right here this whole contest centers. Shall silver be given up and the volume of st andard money be reduced
one-half and its place supplied by credit or confidence money? Shall it be
more credit and less actual money, or more money and less credit? The "object lessons" which are now afforded us ought, it would seem, to settle that

Moreover, a new scramble for gold must follow the loss of silver; gold has
not yet been made a legal tender in India; but the purpose is announced to
finally set up the gold standard there. Austria requires yet $100,000,000 more
of gold to carry out her scheme of gold redemption. Some of the states at
the Latin Union must have more to redeem silver coins held by other states.
The United States must have more to maintain a purely gold standard A
veritable "monetary warfare" must set in, in which the k'brigands may
thrive but the people will perish."
The condition that confronts us is the most perilous in our whole history.
We are on the brink; the abyss is next. Do the gold conspirators think this
scheme of spoliation can be peaceably forced upon the American people?
Gladstone expressed the interest of Great Britain in this movement, in his
speech in Parliament, when he admitted that England held $10,000,000,000 or
more of the debts of other countries, and that the dearer gold became, the
more they would receive when the debt was paid or the interest on the debt
But what shall be said of the people of the United States, debtors to other
countries to the extent of $3,000,000,000 or more, with annual interest of $150,000,000, hurrying to destroy a metal recognized as one of the money metals
of the world for thousands of years, in order to increase the value of the
other in which their debts must be paid?

If the Sherman law is unconditionally repealed, it is the end of bimetallism. It is the end, too. of automatic regulation of money; it is the abandonment of the principle of regulation that has stood the test of centuries
of time. Do they know what they do when they destroy this principle ?
Where will rest the equity of contracts then?
I warn those who are forcing this condition upon us that they are preparing the way for a reign of fiat money. Gold can not be produced in quantities sufficient to maintain the stability of prices and the equities of contracts ; it does not exist, and itheref ore with gold alone automatic ad j ustment
of money supply to needs for money is quite impossible. With gold and
silver, a supply for a long period at least may be relied upon. Nor was there
ever too much gold and silver, nor can there be. Should the production of
these metals, for a time, so increase as to make money plentiful enough to
raise prices, the point is soon reached when a dollar can be obtained easier
by producing commodities than by mining the metals, and production is
checked; this is automatic regulation.
All history shows that prosperity accompanies an abundance of gold and
silver money; that industry is quickened, enterprise stimulated, production
encouraged, wealth increased, and civilization advanced; while, on the
other hand, depression of business, hard times, bankruptcies, want, and
misery have ever been the consequences of an insufficient money supplv.
Our whole trouble to-day comes from the appreciation of gold, not from a
fall in silver. It is from attempting to put the value of two dollars into one.
An ounce of silver, even since the closing of the mints of India, will exchange for as much wheat or cotton, or of any other of the great staples, as
it would twenty years ago; but with a demand for gold to everywhere tak
the place of si ver as money of ultimate payment, gold will rise faster than
ever. At the same time its production, with the closing of the silver mines,
will be greatly reduced. The arts will consume the entire annual production and more. This is the feast to -which we are inviied; no new gold for
money and a double demand for what there is to take the place of silver!
It is preposterous to suppose the vacuum can befilledby bank credits. To
set up a gold standard without any gold for currency, and create bank credits to take the place of silver, is to give us the shadow for the substance. All
such notions are idle dreams. Others tell us to repeal the Sherman law ana
restore confidence, and we can borrow capital from England.
Senator STEWART states the issue exactly when he says it is a question between coining our own money from gold and silver dug from our mountains
and borrowing it from Great Britain.
And when we borrow, what do we get, gold? No. What then? Capital,
they tell us. In what form? If goods, let us produce them at home. Others
say it is credit we borrow, and credit is capital. If that is all we need, can
not the United States create credit as well as England? Can not our banks
create it as well as English banks?
The real truth is, we owe too much abroad now, and all we really get when
we borrow from abroad is release for the time being from paying the interest
on what we owe. It amounts to giving a new note for what we are not
ready to pay, and nothing more. The continuance of this policy long enough
will make us vassals of Great Britain. Let us declare our independence and
coin our own money from gold and silver from our mines.
There must be an end to this borrowing some time, and the sooner the
better. I say the idea that if we were on a gold basis, bank credits would
supply the place of silver is preposterous. We have a foretaste now of this
system. What would be our fate if a few hundred men controlled all the
gold in the country, as would be the case practically, and also had it in their
power to make or destroy, to create or extinguish credit? It is startling to
think such a system possible. Yet this is what is called " sound currency. 1
A gold standard with gold certain to increase at an accelerated rate is a dangerous experiment in any aspect of it, but it becomes alarming when considered as the sole basis of credit. Under such conditions prosperity would
be impossible. A temporary credit bubble might be blown, but a chronic
condition of falling prices will certainly follow an increasing money standard.
industries can not thrive under such a system, and with loss of production labor willfindless constant employment and wages must come down.
The issue turns on the establishment of the single gold standard. All other
questions sink into insignificance compared with this. The present order
of civilization is involved in it, and the life and death of free institutions.
In no way can a people be deprived of their liberties so surely as tofirstimpoverish them. No people not already slaves will submit to such wrongs
Are those who are attempting to foist this system on the people of this
country so insane as to suppose it can be done with impunity and without

England may force such, a system upon her dependencies, but the people
of the United States will never submit to have inflicted upon them an Egyptian or an Indian system of spoliation.
The descendants of the race that overthrew the political domination of a
foreign power will not submit to thefinancialdomination of aliens of any
race or nation. We did not wade through the slaughter of battlefields to
destroy black slavery in this country in order to implant on the same soil a
more galling servitude for our own children.
I say they are insane who think the people of this country will peaceably
submit to the confiscation that must follow the establishment of the single
gold standard, and I go further, and charge that those who seek to accomplish this purpose are the real anarchists of to-day, for they destroy the conditions necessary for the continuance of civilization and the existence of
peaceful society.
Gentlemen, this is a world-wide struggle. The gold combination extends
through many countries; it has unlimited means. It controls nearly all
the great dailies of the large cities. The press that was once the bulwark of
the rights of the people is so no longer. It is in the hands of the enemy and
has been turned against the people. It is as though our arsenals and ships
of war had been taken possession of and their guns turned against our own
people! The owners employ editorial writers as attorneys to write what
they are paid to write. The prostitution of editorial intellect in recent
years has become a disgrace to humanity.
The pen most skillful to pervert the truth, to mislead, and to lie. is most
in demand in this service. Such men. if they had lived in the days of the
Revolution, for pay would have slandered Washington's army and extolled
the political policy of Great Britain, as now they slander everything American and extol everything that is British or Semitic in finance.
This contest is therefore a life-and-death struggle, but if this country is to
remain the land of the free and home of the brave—if it is to remain a country
where government by the people and for the people is to continue—we must
win, and we will win: The compromise we offer, therefore, is to repeal both
the Sherman laws, that of 1873 and that of 1890, in the same act. and restore
to the people the money of the Constitution as it existed prior to 1876.
.Let us have American money coined at home and not borrowed from abroad.