I. BY WILLIAM JENNINGS BRYAN.

We hear much about a “stable currency” and an “honest dollar.” It is a significant fact that those who advocate a single gold standard have for the most part avoided a discussion of the effect of an appreciating standard. They take it for granted that a gold standard is not only an honest standard, but the only stable standard. I denounce that child of ignorance and avarice, the gold dollar under a universal gold standard, as the most dishonest dollar which we could employ.

I stand upon the authority of every intelligent writer upon political economy when I assert that there is not and never has been an honest dollar. An honest dollar is a dollar absolutely stable in relation to all other things. Laughlin, in his work on “Bimetallism,” says:

He even suggests a multiple standard for long-time contracts. I quote his words:

Jevons, one of the most generally accepted of the writers in favor of a gold standard, admits the instability of a single standard, and in language very similar to that above quoted suggests the multiple standard as the most equitable, if practicable. Chevalier, who wrote a book in 1858 to show the injustice of allowing a debtor to pay his debts in a cheap gold dollar, recognized the same fact, and said:

I am on sound and scientific ground, therefore, when I say that a dollar approaches honesty as its purchasing power approaches stability. If I borrow a thousand dollars to-day and next year pay the debt with a thousand dollars which will secure exactly as much of all things desirable as the one thousand which I borrowed, I have paid in honest dollars. If the money has increased or decreased in purchasing power, I have satisfied my debt with dishonest dollars. While the government can say that a given weight of gold or silver shall constitute a dollar, and invest that dollar with legal-tender qualities, it cannot fix the purchasing power of the dollar. That must depend upon the law of supply and demand, and it may be well to suggest that this government never tried to fix the exchangeable value of a dollar until it began to limit the number of dollars coined.

II. BY M. W. HOWARD.

The term, “a standard of value,” so often used, is erroneous and misleading. There can be no fixed standard of value, and the student who wishes to delve into our financial problems should clear his mind of such a fallacy at the very threshold of his investigations.

Money is a commodity; it is regulated by the same laws of supply and demand which regulate the price of corn, cotton, wheat, land, labor, etc. If the wheat crop is short, wheat will be dear; if abundant, it will be cheap. So with money. If the money supply is not sufficient to meet the demands of business and commerce,—if the money crop is short, in other words,—the money will be dear; it will command too high a price, its purchasing power will be too great.

On the other hand, if the money supply is abundant, sufficient to meet all demands upon it,—in other words, if there is a bountiful money crop,—it will be cheaper; it will not have such a large purchasing power; it will be worth less when measured by our labor, our lands, and the products of our labor.

I oppose the single gold standard because it makes the money crop short, gives us a small circulating medium, and hence enhances the value or price of money.

We have a certain demand for breadstuff, which is constantly increasing as our population multiplies; suppose that we cease producing corn, and find no substitute for it, would not the price of wheat be greatly enhanced, providing there is no increased wheat production? So with the money supply. There is a certain demand for money, ever increasing as population grows. How shall we meet it? By producing more money, or by destroying one-half of that which we now have, by eliminating one-half of the base of future supplies of money?

The latter is now the policy of this government, and as a consequence the price of gold has been greatly enhanced, and its purchasing power has increased each year, and will continue to do so.

The advocates of the gold standard call this “honest money.” Their idea of honest money is money that ever increases in purchasing power because of its ever-increasing scarcity.

My definition of honest money is: “A sufficiently large circulating medium, whether of gold, silver, or paper, to bring down the price of money so that we shall obtain fair prices for all labor and products.” Then as population increases and as the demand for money becomes greater, let the government meet that demand from time to time by enhancing the money supply.

III. BY WHARTON BARKER.

The true test of an honest dollar is its purchasing power, and that dollar, and only that dollar, is honest that does exact justice between creditor and debtor. The gold monometallists harp on the injustice of a depreciating dollar, but they ignore the injuries inflicted by an appreciating dollar. They tell us that a depreciating dollar defrauds the creditor, but just as a depreciating dollar defrauds the creditor, an appreciating dollar defrauds the debtor, and it is not one whit worse to defraud the creditor by obliging him to accept a depreciated dollar from his debtor than to defraud the debtor by obliging him to pay in a dollar made artificially scarce and dear.

An appreciating dollar works injustice to the debtor just as a depreciating dollar works injustice to the creditor, but an appreciating dollar is many fold more injurious to trade and industry, for while the depreciating dollar taxes the creditor for the benefit of the debtor, the appreciating dollar takes from the debtor, from producers in general and the industrious classes, and gives to the creditor classes, the drones of society, a larger and larger share of the products of labor, which of necessity discourages industry. Under a depreciating standard the recompense of the producer becomes greater and greater, the creditor classes receive a smaller and smaller portion of the products of labor, the profits of industry increase, and consequently production is encouraged and trade and industry are stimulated. But under an appreciating standard the recompense of labor becomes smaller and smaller, and the share of the products of labor absorbed by the creditor larger, which tends to discourage industry and stifle enterprise.

IV. BY ARTHUR I. FONDA.

The value of any commodity is measured by what it will exchange for. It is in fact its purchasing power, or power in exchange. This in substance is the concrete definition of value given by all economists, and they all unite in stating that value is determined by the supply of a commodity relative to the demand for it; all other factors affecting value being secondary and acting through their effect on either supply or demand.

Since both the supply of and the demand for every freely produced commodity is variable, and since a true standard of value, like a true standard of weight or length, must be invariable as regards that which it measures, it necessarily follows that no single freely produced commodity can be a true standard of value. But while it is true that every single commodity must vary in value, it is also true that all commodities taken together cannot do so. This principle is also accepted as correct by all economists.

It is evident then that a true standard of value can only be found in a composite unit containing a definite quantity of every commodity, or practically speaking, a definite quantity of each of a large number of the most important commodities. This is what is known as the “multiple standard,” or the “commodity standard,” and has long been in use by economists in the form of tables of index numbers to show fluctuations in general prices, or what is the same thing, changes in money values.

The only function of money is to facilitate the exchange of goods. In doing this it acts directly as a circulating medium, and the demand for it for this purpose, relative to the supply, determines its value; for money, whether of coin or paper or both combined in one circulation to meet one need, is subject to the same law of supply and demand which governs all commodities, and which indeed is as universal in the economic world as the law of gravitation is in the physical world.

Incidentally the value of money fills the important function of serving as a measure of the values of goods transferred without the direct use of money, both immediate and deferred. This, however, has no effect on the demand for money or on its value.

The people are accustomed to regard money as of constant value, and an honest money must necessarily conform to this belief. If money varies in value, the people are deluded, and many are wronged if they are unaware of the fluctuation. If they become aware of it,—as they generally do by a bitter experience,—they are confronted with an uncertainty that is most detrimental to any business or enterprise. Imagine what our business would be with our measures of weight, length, and capacity all variable! Yet such a condition would be less disastrous than a fluctuating money value when it became fully known that it was so.

The demand for money varies from many causes, chief among which are changes in the quantity of goods exchanged, the extent to which other credit instruments take the place of money in such exchanges, and the activity of money, or the extent to which it is hoarded, all of which are entirely beyond control. The supply of money, however, can be controlled, and to maintain money at a constant value the supply must be constantly adjusted to the ever-varying demand, so that its general purchasing power may remain the same. The test of a constant money must be a constant general level of prices; and this must be judged by the prices in the open market of those principal commodities which would be selected to constitute the standard of value, the quantity of each being proportioned to its importance in trade.

The only function of gold and silver in a monetary system is to limit the volume of the money, either by their scarcity when freely coined, or by the laws limiting their coinage. And as this limitation of the supply bears no definite relation to the demand for money, the value of the money necessarily fluctuates. Our industrial system is constantly growing more sensitive to even slight changes in money value, owing to the greater diversification of industries and the greater division of labor, and the need for preventing such changes is constantly growing more imperative.

When the people arrive at a clearer perception of these facts and principles they will understand that the chance production of gold and silver is too clumsy a contrivance to properly control so delicate a matter as the value of money under modern industrial conditions, and I believe they will substitute for the present system a circulating medium of paper money, properly guaranteed, and susceptible of prompt and certain increase or decrease of volume to meet every possible variation in demand, and rigidly controlled to conform in value to a true standard of value, a standard composed not alone of gold or silver or both combined, but of all the leading commodities.

In short, they will separate the standard of value from the medium of exchange, demonetizing both gold and silver as to the latter function, but using both and many other things in conjunction therewith for the former function.

V. BY A. J. WARNER.

From whatever side the question is approached, in the last analysis the value of money of any kind is found to depend upon its quantity, and not upon color, or ductility, or malleability, or any other particular quality of the thing upon which the money function is impressed. There can be therefore, in fact, no other standard of value, or money standard, except the quantity of whatever is used as money. When gold and silver are used, the value of each unit of money depends upon the number of such units, and these in turn depend upon the quantity of the metal from which the money is made. Any cause, therefore, which restricts, limits, or contracts the quantity of any kind of money, increases the value of each unit. On the contrary, causes that operate to increase the supply of money have the opposite effect.

Hence, only that currency can properly be called “sound” currency which is made to maintain stable relations to things to be bought and sold. In other words, general prices are determined by the proportion between money on the one side, and things offered against money on the other side. Such money only is “honest” money.

The whole question, therefore, of money standard is a question of money supply; for, as the price of single things, money being constant, depends upon supply on the one hand, as against demand for it on the other, so, in general, prices depend on money supply on the one hand, and things to be bought and sold on the other. This I believe to be the fundamental law of money.