The advocate and Topeka tribune. [volume], October 12, 1892, Page 2, Image 2

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THE ADVOCATE.
MONETARY COMMISSION.
Import of the United States Monetary
Commission, Appointed by Act of Con
gresa August 15, 1870.
NO. XVII.
A single standard eventually ruinous to
creditors. '
It la obvious that a violent contraction
in the volume of money would prove dis
aatrous to all classes of debtors, lnclud
ing nations. This would be lta first
effect, its more immediate result But
that it would eventuate in great injury
and loea to the creditor classes, Is not less
certain. The cases are isolated and ex
optional In which creditors are secured
by pledges so ample as to be absolutely
insured against loss even when the de
preciatlon of prices Is moderate. Their
losses would become enormous In such
a depreciation of prices as would result
from contracting metallic money one
half. In the general wreck which would
follow such a contraction, debtors and
creditors would be engulfed in one com
mon ruin.
As to many debts, specific pledges do
cot exist, as in the conspicuous case of
national debts, swollen already to such
incredible proportions and still Increas
lng. The English, who, from their pre
eminence In accumulated capital, own so
large a proportion of these debts, do, not
conceal their anxieties in respect of this
danger.
The Westminster Review (January
1876) holds that no rise in the pricee of
commodities has resulted from the In
crease of gold since 1848, and that the
tendency In that direction has been at
least neutralized by "the increase of gen
eral population and wealth, Via demons'
Hzation of silver, and the establishment
of gold currencies in its stead in several
states.'" And upon tM effect or further
movements in the direction of demone
tizing silver, It says:
One of the things Involved we hold to be the
probable appreciation or gold: in other words,
an Increase of Its purchasing power; and that,
consequently, unless fresh alscoverles are made,
prices have in their highest for many a lontc
day, and that debts contracted in gold will, by
reason of this movement, tend to press more
heavily on the borrowers, and that it will be well
if this prenmvre do not become ro intolerahle an to
swjQtMU by wny of ooMton, something like uni
versal repuaiaium.
In letters published within a few months
the president of the Liverpool (England)
chamber of commercejeays ofj silver de
monetiz&tion:
It will practically beggar all nations that have
borrowed In stiver and have to oav In sold.
No doubt, If such a state of things were to hap
pen, some countries wouia nave to pass into
llnuldatlon and make a composition with their
creditors, and ultimately matters wonld settle
down everywhere, alter excessive suffering and
confusion, Into a universal system of gold pay
ments : but the necessary result would be that the
metallic basis on which the business of the world
was done would be Immensely reduced. It would
be as Jf the mines were shut up for several years.
Instead of. say. 1,400,000,000 sterling of gold and
silver to do the business of exchange, there
would be 700,000,000 or 800,000,000 sterling of
gold, and a limited amount of sliver as small
change. Money values would fall greatly; na
tional debts, like our own, wonld press much
more heavily, and a period of suffenag and con
traction of business would ensue, similar to what
the United States has experienced on coming
painfully back from Inflated paper toward specie
payments. No doubt at last the process would
be accomplished, and after a century or so the
world could trade as well on gold alone as gold
and sliver combined. But why have the Inter
mediate chaos u it can oe avoided?
It was this same view which Induced
the London Economist, tne special organ
of British financial opinion, to advise
(September 2, 1876) this country to adopt
either the double standard or a single
standard of silver. It then said:
The United States might take the single gold
standard like ourselves, and this Is what, till
very lately, every English economtst would have
advised them to do. The ciHls of thit plan had
not men been teen.
And, after pointing out that in the
event of the adoption of a gold standard
by France and the United States, "the
money markets of the world would be
straitened? the Economist continued:
At the present moment America would become
a stiver country, and the interest and principal
of her obligations would be pall In silver. The
evil, of course, would not be what the momen
tary clreumstaices of the market would now sag
geti Silver would not be at 62 pence per ounce I
If America was a country with a sole sliver cur
rency. flo large a demand as her coin require
ments wouia sena up tne price very rapwiy
perhaps to Its old amount.
It la quite apparent that the wiser cred
Itor nations are beginning to see that
they would inevitably lose more than
they could possibly gain by such a con
traction in the volume and consequent
appreciation in the value of money as
would drive their debtors to bankruptcy
and ruin. They will see it more clearly
hereafter if the demonetization of silver
is persisted In. This country, with its
vast extent of unoccupied fertile terrl
tory, its almost boundless resources, its
Ingenious, enterprising, industrious, and
increasing population, its comparative
immunity from the danger of foreign
wars, Its free Institutions, and its stable
government, would perhaps be able to
sustain any burden thrown upon it by
an unwise and unjust policy. But it
must be remembered that these favor
able" conditions do not exist everywhere,
and that less favored debtor nations
would sink under a load which this coun
try might be strong enough to carry.
IV.
UNDER THE ACTUAL CIRCUMSTANCES OF
THK MOVEMENTS IN OTHER COUNTRIES,
IN THE DIRECTION OK DEMONETIZING
SILVER, IS IT PRACTICABLE FOR THE
UNITED STATES TO MAINTAIN THE
DOUBLE STANDARD?
It is said that the policies of other
countries which we cannot control are
giving to'eilver a tendency to such a de
gree of depreciation and fluctuation as
would unfit It for monetary use, and that
It Is not in our power to resist this ten
dency by remonetizing silver ourselves.
The following is a statement of differ
ent nations, not Including the United
States, with their estimated populations,
classified according to their metallic
standards:
SILVER-STANDARD COUNTRIIS.
Population.
Russia 76,000,000
Austria 30,000,000
Egypt 4,1500.000
Mexico r 8,000.000
Central America 2.C00.000
Ecuador 1,300,000
Peru 3.4110000
China 400,000.000
British India 237,144,459
408,941,450
As Russia and Austria both have le
gal tender paper money, their population
will be non-effective In relation to the
matter In hand, until they resume specie
payments, or commence to hoard specie
with a view to such payments. With that
deduction, the population actually using
the silver standard is 650,944,450.
DOU B LX-ST AND ARD COUNTRIES.
Population.
Greece 1,400,000
Koumanla. 4,000,000
Colombia 2,900,000
enezueia 1,000 000
Chill -1,1100.000
Uruauav 400.000
ParajruaT 1.200,000
Japan 33,000,000
uoiiana 3,700,000
France 30.200.000
UOIAIIUllXU
Switzerland 2,700,000
Italy 2C,800,0'iO
pain 16,400,000
137.300,000
As Italy has not only a legal tender
paper money, but substantially no metal
lic money in circulation, its population
may be set down aa non-effective, thus
reducing the population of this group to
110,500,000. In Holland, France, Bel
glum, Switzerland and Spain, containing
population of 64,100,000, the coinage of
silver Is either limited or entirely suspended.
GOLD-STANDARD COUNTRIIS.
Population.
Oreat Britain 32.000.000
Canada, Cape of Good Hope, and Aus
tralian colonies 7,000,000
Germany 42,000,000
Norway 1,700.000
Sweden 4.300,000
Denmark 1,800,000
Portugal 4,000,000
92,300,000
This classification excludes Brazil, the
Argentine Republic, Turkey, Tenia, the
great bulk of Africa, aad some minor
countries and colonial possessions In
Asia.
Brazil and the Argentine Republic
have the gold standard nominally, but
the actual currency is legal tender paper.
Turkey and Persia have the gold stand
ard nominally, but not in fact, the actual
currency being gold and sliver coles.
Within a few months Turkey has com
menced the issue of legal tender govern
ment raoer.
Africa has a considerable population
but, outside of Egypt and Cape Colony,
its relation to coinage or legal standards
Is trifling and unimportant. Both of the
precious metals are recognized as money
among the peoples inhabiting it, who
have a special preference for the silver
dollar, the coin which centuries of use
have made most familiar to them.
In the non-enumerated countries of
Asia silver Is the metal in general use.
and some of them, as Siam, Burmah and
the Dutch colony of Java, have popu
latlons which are considerable, although
small in comparison with the population
of India and China.
In Spain a royal decree was Issued in
the summer of 1870, interdicting the
coinage of silver except on government
account. This decree also declared It to
be the intention of the government to
limit the legal tender function of silver
to 150 pesetas, or about $28, after it had
obtained and coined a sufficient amount
of gold to make it practicable to do so.
The peseta and franc are equivalents in
value. The reason assigned for this in
tention was the depreciation of silver
relatively to gold. The price of silver in
London was at about Its lowest point
when this decree was issued. What in
fluence the subsequent advance In Its
price In that market may have on the
policy of Spain is uncertain.
In Holland silver was the sole stand
ard until 1816. In that year the double
standard was adopted with the legal re
lation between the metals of 15.873 to 1,
which undervalued silver and practically
banished it from the circulation. In
1847 silver was again adopted as the sole
standard, not in consequence of the dis
covery of gold in California, but just be
fore that event. The principal reason
assigned by the statesmen of Holland
for this change In 1847 was, that it had
proved disastrous to the commercial and
Industrial interests of Holland to have
a money system Identical with that of
England, whose financial revulsions,
after its adoption of the gold standard had
been more frequent and more severe than
in any other country, and whose injurious
effects were felt In Holland scarcely less
than In England. They maintained that
the adoption of the sllyer standard would
prevent England from disturbing the in
ternal trade of Holland by draining off
its money during such revulsions, and
would secure immunity from evils which
did not originate in and for which Hoi
land was not responsible. In 1875 a law
was passed interdicting the coinage of
silver except on government account, and
providing for an unrestricted gold coin
age, with unlimited legal tender func
tions at a legal relation between the
metals of 15.604 to 1.
This law was avowedly provisional,
and was to expire January 1, 1877, unless
re-enacted; The executive department
of that country decidedly favor the gold
standard, and have proposed two laws
for its establishment, both of which have
failed to receive the sanction of the legis
lative chambers. The law first proposed
restricted the coinage of silver at the
Java mint as well as at the home mint,
and deprived silver coin In Holland, but
not In Java, of the legal tender function
except for small payments. The law
last proposed prohibited absolutely the
further coinage of silver. It did not de
monetize coins already minted, but au
thorized the finance minister, at his
discretion, to purchase and withdraw
them from the circulation. The Ameri
can minister to the Hague, November 27
1876, referring to this law, says:
With regard to the Dutch East Indian colonies
the rule will be substantially the same, leaving It
to the minister of finance to make proper ar
rangements with the colonial minister.
This law was agreed to in November
last by the lower chamber, but was de
feated in December in the upper cham
ber by a decisive vote; and thereupon, on
the 23d of December, the ministry pro
posed a new law, substantially keeping
In force the law of 1875, which was
passed. The ultimate policy of Holland
remains to be determined.
France, Belgium, Italy, Switzerland,
and Greece constitute what is called the
Latin Union, and are bound by treaty
until 1880, to receive each other's gold
and silver coins at their respective treas
uries at a relation of value between the
metals of 15 to 1. By an agreement
made In January, 1874, and which still
continues with modifications, France,
Italy, Belgium, and Switzerland limited
their silver coinage (exclusive of sub
sidiary coins) to the following sums for
the years named, stated in francs:
1874 140.000.000
1875 150,000.000
1876 108,000,000
These were the maximum amounts of
the silver coinage permitted by the
agreement for the years named respec
tively, but either country might decline
to coin the quota assigned to It, and in
fact Switzerland did so decline in 1875.
In August, 1876, the president of France
suspended entirely the coinage of silver,
except for subsidiary purposes. This
was in pursuance of a law passed August
5, 1376, authorizing him at hla discretion
to keep the mints of France closed
against the coinage of silver until Janu
ary, 1878. In December, 1876, Belgium,
following the example of France, also
suspended the coinage of silver.
These restrictive agreements and acts
in respect to the silver coinage constitute
what is known in current discussions as
the "expectant attitude" of the Latin (
Union. They amount on the one hand,
to a refusal to join Germany in a gold
standard, and, on the other hand, to a
prevention of such an increase of their
silver coins as would augment the diffi
culty and loss of going to a gold stand
ard, if they should hereafter decide uporr
such a policy. They will be character-,
lzed as wisely cautious, or Irresolute and
weak, according to the varying opinions
of observers. In fact, they may be 1
neither; but rather the only compromise j
which was possible ofnearly equally
divided counsels.
(To be continued.) !
Excursion to Shenandoah Valley.
On Tuesday, Ootober 25, the Baltimore A '
Ohio railroad company will sell excursion
tickets from Chicago and all Baltimore and
Ohio points west of the Ohio river to Win-;
cheater, Woodstock, Middletown Harrison-1
burg, Staunton and Lexington, Va., at the
rate of one lowest limited first-class fart'
for the round tnp. )
The Shenandoah valley, Virginia, offer
superior inducements to persons seeking
new locations. Farm lands offered at from '
$10 per acre and upwards. Timber, coal J
iron ore, pare water, convenient markets f
excellent soil, good schools, beat society
For information about rates, apply to an J
Baltimore and Ohio ticket agent. Send tr
M. V. Richards, land and immigratior
agent, Baltimore fc Ohio railroad, Balti"
more, Md., for information about deeirabls
locations, maps, pamphlets, etc L
The Advocate and Tribune and th
Kansas Farmer can still be had at tL7 f
for a year. Every farmer needs then
both. 1