| Show KBOUT HARD MONEY f Senator Teller on the Technicalities Technicali-ties of the SilverBill j BI1IETALLIS1I MONOJIETALLISM tad tile Ratio ew en Gold and Silver An Able Argument Against Dcmonetl zatlon of Silver SEXATE CHAMBER July 11S90 Special iorrespondcnoo of Tnt HSUAIDJ Since he present agitation of the silver question 10 called began in Congress I have re jeivcd many inquiries which convince me ht while there is a general desire among hc people for information on the subject iud a general feeling of friendliness to ward the proposed reform many are itjnor1 i lut not only of the primary principles in rolved but aro even uninformea a to the meaning of the terms employed in speak up on the subject It has been suggested M me that a plain definition of some of the terms most frequently used in the discus Jicn of the question of bimetallism and a oref statement a to the elementary nciples involved would be of service to Lee proportion of the American public iii I waile doubting my ability to throw the I ioded Hght upon the subject I have con ieted t maKe the attempt promising that As article is for the lay reader nlono and notfor those who have made 3 study of the t juojoct and are familiar with the terms em pioje in the discussion of it People often ask what is bimetallism what is monometalisui and what is meant r by the ratio between gold and silver Tao money metals now recognized are gold and silver Formerly copper was re yarded as a money metal and used for small I cins > and while it is still used for small I sons it is no longer regarded as a mone netuL Those who Think both gold and I I1 < vci should be used as money are called I hi Eiftallists or twometallit > ts Those who taluk hut one of the money metals ought to br employed arc called monometallists or Diic TECtaThsts Those who think gold alone su J 4 be used as the legal tender money of 11 11 it i ryare called gold mono metalhsts i iiose who desire to use silver only aro k silver moaoniLtallists i te gold monometallic countries make UU legal tender for tho payment of all jehts while Silver is used only as a subsi 3iar coin Silver monometallic countries i silver the only legal tender treat Britain since ISm has been a gold m metallic country silver being used for small money and as a legal tender to tit amouLt of about S10 or 2 India is a silver monometallIc country utidbeij an article of merchandise and i not a legal tender France is a double standard or bimetallic sou try and has gold and silver in about quu quantities having 900000000 of gold while Great Britain has only SooOOOO J I Great Britain has 100000000 of sil Vc and France has between 700000000 at S 0000 000 and some claim even more thu that amount 1 y e population of Great Britain is 35i 1452 France has 3 population of rf 11 suns Ht03 Jin United States has always been a double standard country except during the pi ricdlieuveen February 12 Ib73 and Feb lU4 j 2s 1S7S The United States has abo t S4000000 of gold and about 3 XtO t of silver Aoour 130000000 to 140000000 of people Df the gl be are inhabitants of gold monometallic mono-metallic countries and the rest of the world either belong to the silver monometallic countries or t bimetallic countries So it 11 be observed that about ninetenths of the population of the world that use money ase siVti silver and gold a legal tender Many of even the gold monometallic coun ti cs u > usf usosilver as subsidiary money u 0d not being fit to make small coins of line half dollars quarters and dimes I B ratio between gold and silver is meant the relative value that one kind of metal bears to the other When we say the ratio between gold and silver is as one t fifteen and one half we mean that fifteen and one half ounces of coined silver will exchange one ounce of coined gold This relative proportion or ratio was first fixed by the nerchants and traders and was afterwards established by law The first accounts of I < y rVr flr f i 1 i i I I t V l tP t b o f l l r iA t k 4 rr I I J I ot ilill i > A J < 7 i I f4 y = S 9 l A 1 J I v y citft Ct J I fl f i i7i I I i I I Il SEXXTOII IIEXRT sr rLlI the fixing oJ the ratio are somewhat con fased But we know that the ratio was tmt te wa rato fixed in England a early as 127T and at different times later by royal proclamation and in France in ITSo and 1S03 The ratio tixe I in France in 1 is and 1S03 was that of one to fifteen and onehalf and this ha bvu called tho French ratio It was the pi uilinp ratio of Europe for legaltender SiKi but not for subsidiary silver For this the ratio has been less as lov as one 13 th rtecn and on to lourteen anu m some ou tries even still less India has I large aiuflt of silver and its ratio there is fjLjen TO one Tic ru iO in this country was first fixed e i J t t Ven and that being too low W4 in 0 rva1 afio of silver and l un ec1uatia oi gold Consequently the I g jveiir to the countries where it was rained mo e highly nhen compared with tihcr and we were in fact OH a silver bass while according lola we employed the t1nblt standard In 1SST we changed our rti0 to cue t sixteen or t be exact to one to fifteen and ninetyeight exact dodths Then we undervalued silver and overvalued gold and thc si > ver went where It more valuable and ol was gold was the m only metallic money wo had loft in circuit1 ton except oreijM silver coins which con taiuid to circulate I is suppose that the amount of gold and I silver ui the world in use as money is about equal and the amount has heen variously SbUajatcd The exact amount is not mater a for with hoth metals 1u use as money A Lu > been found necessary to resort to paper because of a lack of rold and silver t meet the Demands 10M money and the m paper money iu theworld Ao1 larro now es > ceus the amount of either gold or silver Tt s now propose by the gold monome Laiss to tiiscwd silver except for minor join or subsidiary money and to do the I ousiness of th world with gold alone The mister m-ister of this movement is both int rest j ng and instructive ttvas proposed in 1836 and 1837 when ho production of gold from California and L I I Australia was early 200000000 per an j aum and silver only about onefourth that I amount t demonetize gold and Germany aid demonetize gold In ISS7 a conference of the representatives I representa-tives of various nations met in Paris and I 1 proposed to make gold the sole standard I ind to demonetize silver A bill was introduced intro-duced into the Senate of the United States In 1868 lor the purpose of demonetizing I silver A favorable report was made by I i 1 Hon John Sherman of Ohio from the committee com-mittee on finance and Mr Morgan of New i j York made an adverse report for the minority of the committee No action was I taken on the bill beyond what have stated In 1871 Germany took the first decisive I step and demonetized silver and declared gold the sole standard providing that silver sier I should be used only for minor coin In 1S72 a bill was introduced in the House of Representatives of the United j I I Slats to amend the coinage acts of the United States It passed both Houses amid I i became a law by the approval of President j Grant on the 12th day of February 1S73 I By this bill the cold dollar was made the unit of value and the legaltender l silver i dollar disappeared from auong the coins of j i the country This featuro of the bill does not appear to have attracted the attention j I of the members of either House of Congress I I Con-gress and General > Grant did not know un I IU 3UIUU LIIUU illlCr toe HlpLU ill Vi IUU act j thai sliver had been doinonetizod in this I country by that act It has been claimed f I that this demonetizationwas in the interest of the creditor class and was secretly done cass secret j Whether it was the work of the creditor class or not it is quit certain that it has re suited greatly t the benefit of that class by reducing the amount of money iu circulation circu-lation and increasing purchasing power crcu I I Norway Sweden Denmark and some I other countries followed our example of j demonetization and the Latin union first j i limited the coinage of silver and when the j silver frI Germany was thrown freely on I the market closed the doors of its mints i I acaintst silver So Gem any PranceItaly the Scandinavian countries and ttte United I j j States refused to mint silver Germany I I threw on the mnrirrtall the silver she could II I I spare the United States sent all its produc j I i tiou lully one thitu of the worlds product I I to Europe TO be used to break down the 1 market price of silver and thus discour I i ago its use and increase the demand for I I gold Germany the Scandinavian coun J tries the United States Italy all became Ialy al j I bidders for gold and the price of gold went I j 1 up when measnvf not only by silver but I by all products and commodities G ier I I many the United States Italy and other J j countries called for and received vast sums j 1 j of gold to take the place in the United i States and Italy of paper money and in I Germany of Silver France to pay her Gorman indemnity had parted with a great part or her gold and was also a bidder lori lor-i gold to make good other losses Thus the j j principal financial countries of the world were buying gold and discarding silver j 1 and silver ceased to sustain the relation to I j gold that itJbad theretofore sustained but i it cid and still does maintain its relative I position to all other things that it did be I fore Js73 In February ISiS the Congress of the United States passed a law restoring the I silver dollar t the circulation of the country coun-try by the purchase and coinage of 2000 000 worth of silver each month This bill wasv ted by PresideD I Hnyes and passed over his veto on the 23th of February of i that year Under that act which is still under operation there had been coined up to the 10th of the present month S3H3G I 250 Of this amount there was at that date in circulation 5f5GS342o silver dollars while I the silver certificates issued on silver dollars dol-lars held in the treasury for the redemption of the certificates amounted to 8293 513043 making a total of silver dollars and certificates certifi-cates in circulation doing money duty of t5ll64O This leaves a balance of sil ver certificates and silver coin in the treasury treas-ury of only 18012564 The act of February 23 187o has been known as the BlandAllison bill This Dill met with the most determined opposition opposi-tion from the President and secretary of treasury bankers chambers of commerce boards of trade and what is known as the capitalistic class of the country all of whom prophesied disaster to the business busi-ness of the country i it became a law because of the inflation which they claimed would be the resuit ot coining so much silver and ue caue as they declared gold would be driven out of the country The secretary of the treasury declared that the coinage of 50000000 of silver dollars would drive all the gold out of the country Senators and members opposed to the bill joined > in these prophesies of evil We have coined more than seven times fifty million dollars and yet the country is not on a silver basis We have now more than four times as much gold in the country as wehad in 1S7S The demonetization of silver was brought about by the creditor class the only class that could be benedtted by the destruction de-struction of one half of the money of the world for it is 3 wellestablished principle in finance that the number of units of money determine its value That is if there are but few dollars in a country each individual dollar will buy more than it would if there were many dollars The demonetization of silver in Germany and the United States induced other Stats otler nations na-tions to demonetize silver Thus the demand de-mand for silver was lessened and the demand de-mand for gold increased for when a dollar of silver was prevented from doing money duty a new gold dollar had to be found or the gold dollar in existence had to do increased i in-creased money duty The effect of this I was to appreciate gold or in other words reduce the prices of all commodities prces ul measured meas-ured in gold In a short time gold bullion would not exchange for silver bullion on the same terms as formerly and the same was true of wheat corn cotton and all other products Then the gold mono met allists insisted that silver had fallen when as a matter of fact it was gold that had risen Silver whether considered as bullion or as coined into dollars has appreciated in the last seventeen years I will in either form exchange for more commodities of all kinds than it would then In countries using silver siver this is plainly seen by the slight fall slght fal in prices prces Gold has appreciated in 1 greater degree than silver not because of us especial lit ness for money but because of its scarcity I do not mean that there is any less gold than formerly but that the same amount of gold or nearly the same amount is required 10 quired to do nearly double the work that it lormerly did In other words the work formerly performed by silver and gold is now largely done by gold alone Let us illustrate Suppose wheat and corn furnished fur-nished the required amount of grain for mans use aid by some means all the corn should be destroyed Then wheat alone would not sullicc and wheat would btmap hPen nl n l v uu UiLU JU1 The principal uetnand for 1 gold is for use as money if that demand is increased gold will appreciate Tuis demand was increased just to the extent that the use of silver diminished di-minished The principal demand for silver is for I use as money and it that demand i re duced it may derr cat or it may simply prevent its appreciation with appreciaton cold which j is its natural tendency it being put to the I j same use cud capable of taking the place of tjod I wheat goes up in price corn invariably lollows ai do l cereals Of I course there are exceptions to this but asa as-a rule other tiling being etiuul things that cal hl I put to the ao use rise ana fall to petlu These inuis ate ru exception 1 and v hen one of them is aicurditi and the burden of doing ticubui duty i s thrown upon the other the demand for the fCr one remaining re-maining hi usu is increased in proportion to the amount in service previously done by trio discarded m tl I So much as to the facts Now a word in argunitat Want could the producing classes gain by the demonetization of silver What advantage could it be to the people engaged in trade ol agriculture or 01 j 1 production of any kind to do tliti busi1 i ness of the woild with onehalt of I the metallic rnoiay that oUGhal 1al < n hereoiord in usef Silver bad not I depreciated Even when measured by gol4 it had proved itself a ttape uionoy I metal for thousands of years and had been I I tile standard by which gold hud been i measured It was the favorite money of i the people of the world It was rue urst I metalic money used by man and it was the only money meal tbat promised to be pro I t dured in sutllcient < quantities t kvei pace I with the worlds oeinand for meudiii I money The production of gold wasfallim oil U01 cah l yta and itwsis quite evident that no great reliance could be placed oil gold as a money msuil for the best inlornieu people on that subject have declared that its production was not sufficient after wa sufcient ier deducting tho i i i i amount required for in use the arts ana the loss by wear and waste to maintain the present stock of goldin them world Hence i i lwe must admit that the demonetization i I I silver crime was cither a great t blunder or a great All who have examined the effects of the I demonetization by Germany and the Uni j ted States in the first instance and other I nations later must and I believe do admit I that great evils have resulted therefrom II j I No one has yet been able to ishow that it I I has been of any advantage to any class save the creditor class The demonetization of silver has increased increas-ed the purchasing power of gold ao that the same of gold will now command I com-mand much more laborand more commodities commodi-ties of all kinds than it would In ISTl or prior thereto The price of labor is lesd l and all the products of labOr bring a Idwer price Laud is not Worth so much Machinery Ma-chinery and buildings used for the production of commodities are less valuable It requires more labor more effort more sacrifice for the debtor to procure tile meansto pay his debts than it did before the demonetization j of silver It is pretty generally conceded that the all in prices is i not far from lli per cent On many articles it is thuth greater than that This then is equivalent equiva-lent to an addition of 3 per dent to nil tho debts In other words the creditor will ret 33 per cent more of commodities i wi is pam in commodities i and it paid in I i money tho money ho receives will pur chase b3 per cent more while the debtor must make an effort 33 per cent greater than t he other he would to pay his debts This then is equivalent to the cebt of 33 i per cent to all the debts in the world for this decline in prices is not confined to this country I I as all admit silver is to be used as I money in the future why not go resolutely to work to put it back in its old c mdition a s the equal of gold at its proper ratio I Why not at once open our mints to the free coinage of silver and declare t the world that the country producing more 1 I than onethird the silver of the world intends tends t use silver as money legal tender j I money u Suili a course wduld give courage t al the metsillists in the world and would in a shor time open all the mints of Europe to the unlimited coinage of silver with the possible exceptions or Germany and England and both of those countries I would in u few years compelled to follow I the eauple of other nations or trade with the world at great disadvantage It is said by the opponents ot free coinage I coin-age that all the silver of the world will I come here to be coined and we will be on the single standard of silver But is this I irjiei What country can spare silver from I its i currency where it is now being useui t TIe secretary of the treasury declares there is no surplus of silver in the world The royal commission of Great Britain declared de-clared there was no surplus of silver The i mints of India have been open all the time lor tho coinage of silver at a ratio G percent I per-cent below our ratio and 3 per cent below the French ratio and yet India il has not received af much silver ver during the last fourteen years as II she did from Ib54 to 170 a like period I I of fourteen years when silver was higher i than the ratfo of one to fifteen and one hal measured by gold The mints of Mexico Mex-ico 1 and Japan have been open for the coinage coin-age of silver below the market rate yet silver has not gone to those mints in unusual un-usual quantities simply because there is no I surplus of silver China has now opened her mints for the coinage of silver much below tim market rate its ratio being a I trifle above ours There is no danger of an influx of silver from India and Uhina for those countries do not have a sufficient amount for their own use India with 250000000 of people according to the report of the United L States treasury department has little more m silver than France with about oneeighth of the population Not a dollar of silver can be shipped from Europe to the United I States and coined at our ratio but that there will be a loss of from 3 to 7 per cent The experience of the last seventen years I has demonstrated that it is dangerous to m attempt to discard silver and it is quite certain that no country now using silver as money will use any less than it is now using I the mints of the world were open to I the unlimited coinage of silver the demand I for silver would be greater than ever be fore I we open our mints to the free coinage of silver all the world will be ready and willing to join us in fixing a I ratio between gold and silver by which it shall be received at the mints of the world What will that ratio be The great mass of silver now in use as money is coined at the ratio of fifteen and I onehalf to one and if we agree to that ratio and recoin our silver now in the country coun-try it will be appreciated not less than 3 per cent and our production now about fifty million ounces will not only be ap preciated the 3 per cent difference in our ratio and the European ratio but will gain the difference between the mint value and the present market value and the gain will amount to not less than twelve million five hundred thousand dollars per annum This amount will be added to the wealth of the country It will not go into the pockets of the silver miners as claimed but will because be-cause of the increased price of all products prod-ucts increase the cost of mining silver and so be distributed through all the agencies production throughout the country H M TELLER ZI LLEI |
