  Various Phases of the Money Question.Hon. Thomas E. Watson, Thomson, Ga.: Dear Sir:—Your logical editorial in your October magazine under the caption of “The Money Changer and the Politician” hit the bull’s eye and went straight to the heart of the subject. I heartily endorse the editorial. Hon. A. S. J. S——, a very able and conservative gentleman and also a gold bug as we sometimes denominate them, takes issue with you, as to some of your assertions, and as the Doctor is a subscriber to your magazine and very much open to conviction I am led, as a result of a pleasant discussion with him to ask you some questions on said editorial for the purpose of drawing you out more fully on the subject for the Doctor’s special benefit and for general light on the money question. The questions that I propound embody the objections of the Doctor to what he otherwise concedes to be an able elaboration of the question under discussion. You say, “Sparta rose to be a state of the first class on a currency of iron; Rome became Mistress of the World on legal tender copper; coined silver did not come into use until the Northern barbarian beat down her frontiers; gold held no place in the coinage till the imperialism of the Caesars had taken its lead in her decline.” (1) Do you mean to say, that gold and silver did not exist as currency, prior to that period referred to in the passage just quoted? The Doctor says you are all wrong here and asks that your authority for the declaration be given. (2) He wants you to give more explicitly your authority for contending that paper money is Constitutional; he combats the idea of the Constitutionality of a paper currency, asserting that gold and silver is the money of the Constitution and not paper. (3) What is your authority for saying that Mr. Cleveland ruled that Governmental notes which were payable in coin should be redeemed in gold only? He disputes this. (4) In your glowing description of the effects of paper currency, during the wars referred to by you, how it fed and clothed the soldier and kept starvation from those the soldiers left at home—he asserts that the gold and silver currency in circulation during the times you allude to could have accomplished all you claim; independent of a paper currency. (5) Was the paper money issued by the Confederate Government during the Civil War as good at any time, during said war, as the paper money issued by the Federal Government during the same war? If not, why not? Understand me, I am perfectly in accord with you. I am asking these questions in order that you may have an opportunity to knock the sophisticated props from under the Respectfully, ANSWER.(1) Yes. Gold and silver were used in commerce and commodities, even as precious metals, but not as legal tender money. The legal tender money of Sparta was of iron. Lycurgus made it so, for a special purpose. See Plutarch’s “Lives,” or Aristotle on “Government.” The legal tender money of Rome was copper during all the long and bloody years of her relentless and resistless march to world-power. Gold and silver were used in commerce on the basis of barter—but not on any other. Neither gold nor silver were coined into legal tender money, until after Rome had become Mistress of the World. See any standard History of Rome—Mommsen’s for instance; and see, also, Del Mar’s “Money and Civilization.” (2) Paper money is Constitutional, for the reason that the Constitution, itself, gives to Congress the right to coin legal tender money, and the Supreme Court of the United States, in a case brought to test that very question, decided, in effect, that the word coin, as used in the Constitution, has the sense of “create,” and that Congress can create legal tender money out of paper, if it sees fit to do so. Congress had seen fit to do so, for the good and sufficient reason that the expenses of the Government had increased to more than a million dollars per day, and there was no specie money in the Treasury. The Government made money out of paper because it had nothing else to make it out of. Ground hog case, Doctor. (3) The facts in the case. The Contracts were payable in coin, just as in France. The option, of payment in silver or in gold, belonged to the Government under the words and in the spirit of the contract. In France, it was the same. The creditors claimed payment in gold, both in this country and in France. The French Government calmly bossed the situation as any real Government should, and paid the contracts as it pleased in either “coin.” When the French Government felt like paying gold coin, gold was paid. When the Government felt like paying silver coin, silver was paid. In either case, the creditor got what his contract entitled him to get—COIN. But Mr. Cleveland’s “Government” was not so robust. He took it into his head that “the bankers had the country by the leg.” In fact, he told Mr. Oates of Alabama that such was the case. Absurd! No real Government would ever get into that kind of blue funk. Mr. Cleveland should have shown some of the “back bone” that we have heard so much about. He should have said to those Wall Street Raiders, “I’ll give you COIN—get anything else if you can.” When the Government had the gold, the yellow metal should have been handed out. When the Government did not have the gold, it should have handed out silver—saying to the Raiders, “Take it, or leave it. Your contract says COIN. There is coin. We make you the legal tender of it. If you don’t take it when so tendered, your claim against the Government is as dead as Julius Caesar.” Then the Government would have had the Bankers “by the leg.” But, you see, Cleveland was standing in with the Wall Street crowd—and that makes all the difference. Suppose our friend, the Doctor referred to by Mr. Hairston, owed ten different notes of ten dollars each, every one of them containing the plain statement that they are payable in “coin.” “THE CONUNDRUM IS: WHAT WOULD BE LEFT TO UNCLE SAM, IN THE MATTER OF NATIONAL FINANCE, AFTER THE BANKERS SHALL HAVE GOT ALL THAT THEY WANT?” Suppose that they fall due and are presented for payment. Suppose the Doctor has half the money in gold coin and the balance in silver coin. Suppose he offers the entire $100 in coin, in satisfaction of the debt. Suppose the holder of the notes rejects the silver “coin,” and demands the entire debt in gold coin. What would the Doctor do? Would he hurry and scurry about, hunting for gold to satisfy the exacting creditor? I’ll bet a medium sized mouse-colored mule that he wouldn’t. The Doctor knows that silver coin is legal tender, and was contemplated as one of the coins of payment at the time the contract was made. Consequently, he would tender the silver, and if the offer to pay in that “coin” were refused, the Doctor would simply let the creditor do what the heathen does when Christian Civilization gets after him—RAGE. (4) Let the Doctor peruse the Life of Chase, who was Secretary of the Treasury under Mr. Lincoln, and he will realize how much he is in error. Many other authorities might be cited. Gold and silver had disappeared. Specie payments had ceased. The Government was about “broke.” The daily expense account was approaching the two million dollar mark. Spaulding, Salmon P. Chase, Thaddeus Stevens and others realized that unless the Government could float a paper currency the jig was up. It was just about then that Lincoln expressed the opinion that some of the Wall Street bankers ought to be shot. They were manifesting every disposition to take advantage of the distress of the Government. They were showing that they meant to get rich off the war. And they accomplished their purpose. They failed to obstruct the plan to issue paper money, but they succeeded in having Congress virtually say that while the Greenback was good enough for the soldier who was shedding his blood for his country, it was not good enough for the Bondholder who was sitting at ease in the financial Zion of Wall Street. (5) My understanding is that the first paper money issued by the Confederate Government circulated at par when first issued. The legal tender currency of any Government must depend, in any case, upon the strength, resources and credit of the Government. Even the coin-currency sinks to the mere commodity-value of the coin, when the Government sinks. Even now there is an artificial value in gold coin, put there by law. No pile of a million dollars in gold coin would sell for a million dollars as metal. In such a heap of gold you must allow for “wear and tear.” The law does allow for that very thing. If the gold coin is worn away to a greater extent than ten per cent, the Government will not receive it as legal tender—nor will the metropolitan banks receive it. But anything less than ten per cent loss in weight, the law makes good, by declaring that such coins are legal tender. Few people stop to think of that. Therefore, every kind of money is fiat money; that is, THE LAW MAKES IT. Now, it must be self-evident that the value which law puts into currency SINKS, WHEN THE LAW-MAKING POWER SINKS. If one can conceive of such a thing as the annihilation of the United States we must know that our gold coins would at once go into the scales to be weighed and priced as metal; our silver dollars would do precisely the same thing, and each of them would be worth less than 70 cents. As for our paper money, it would be waste paper, and nothing else. United States greenbacks would Four Pertinent Questions Answered.Enterprise, Ala. Hon. Thomas Watson, Thomson, Ga.: Dear Sir:—1. What are the fundamental principles of the four parties, Populist, Socialist, Democratic and Republican? 2. Do you favor the way the United States allows the banks to use national currency without interest and then charge the people 12 per cent? If not, why not? 3. Do you think there is any likelihood of the Rural Free Delivery ever being discontinued and if so on what grounds? 4. What does the Parcels Post Bill advocate? *** ANSWER(1) The Populists believe in the Public Ownership of Public Utilities—such as Railroads, Telegraph and Telephone Lines, and Express Companies. They look upon the iron highway as a Public Road that should belong to the Public. They believe that the tremendous power which private ownership gives to the private corporations now owning the railroads is too great, too ruinous when improperly used, to be exercised by those whose sole aim is to extract the utmost possible dollar of profit out of the franchise. The Populists believe, also, that there should be a return to the money-system of the Constitution. The National Banks have USURPED the function of supplying the country with a proper currency. At the present time, when the Government has but $353,000,000 of its own paper notes circulating as money, the National Banks have the enormous sum of $583,000,000 of their paper notes in circulation as money. Populists contend that it is the prerogative and THE DUTY of the government to create ALL THE MONEY THAT CIRCULATES, and to hold unto itself the power of regulating the supply. Populists believe in the Tax upon Incomes, and contend that this tax should progressively increase as the Income increases. They believe also in a tax upon Inheritance. Populists lay particular stress upon the great principle of Direct Legislation. They believe in allowing the people to compel the law-making power to act when they, the people, want certain laws. They contend that it is no more than right to compel the law-makers to refer proposed legislation to those who are affected by it. This principle has worked happily wherever given a fair trial, and is usually called the Initiative and Referendum. Populists contend, also, that all officers should be elected by direct vote of the people, and that the people should have the right at any time to retire an officer who has forfeited their confidence. This principle is usually referred to as the Right of Recall. In practice it proves a most excellent method of MAKING THE OFFICE-HOLDER “WALK THE CHALK.” Populists also believe that we should have a system of Postal Savings Banks. These would furnish to the people convenient and safe places of deposit for their savings; and the system would go far to lessen the dangerous power of the metropolitan banks. Populists are opposed to land monopoly, favor the eight-hour day in factories and similar industries, and believe that the employment of children of tender age in manufacturing establishments, mines, sweatshops, etc., should be watched with hawk-like Populists believe in UNTAXED NECESSARIES OF LIFE, and contend that whatever tariff duties are imposed should be laid upon luxuries. In brief, Populists strive for the adoption of those principles which would make this a real Republic, instead of an Aristocracy ruled by a Class, or a Plutocracy in which Dollars dominate. And during the whole time that the Politicians and Sages and Powers have been laughing at us, we have been quietly furnishing with our garments the wardrobes of such eminent Politicians, Sages and Powers as Roosevelt, Bryan and Hearst. Bryan accuses Roosevelt of stealing the very clothes that Bryan himself stole from us. As for Hearst—before he fell down on that Murphy deal—his editorials and speeches were nothing in the world but the echo of James B. Weaver, Jerry Simpson and Mary Ellen Lease! Had he kept up the lick, and not gone into that deal with Murphy, he would have been elected Governor of New York. He parted with his most valuable asset when he ceased to be an Independent. The Socialists think they believe in the collective ownership of those things necessary to the production and distribution of wealth, but what they are actually driving at IS THE CONFISCATION OF PRIVATE PROPERTY and a jolly good division of the same, in order that the Have Nots will be upon an equal footing with the Haves. That’s the inner meaning of practical Socialism, and that’s why it assumes so savage a character in our great cities. In the hearts of the rank and file Socialists, are burning the same fierce fires as animated the Goths and the Huns when they bore down upon opulent Rome. I have heard these people talk and I know what it is they really mean. The Democratic Party, at present, hasn’t got any principles capable of proof. They are waiting for the next National Convention to hand out a new suit of clothes. They are awful sick and tired of that Parker platform, which is almost the same as the Republican platform—as poor old Gassaway Davis said. But they cannot “point with pride” to any other platform until the National Convention meets. Just what will then be done, it would take an able-bodied prophet to tell. My own opinion is that they will adopt the leading principles of Populism and put Bryan to running for the Presidency again. The Republican Party is doing just what Alexander Hamilton thought ought to be done—running the Government in partnership with the rich, for the benefit of the rich. The Republican rule is a Plutocracy, tempered by an occasional spasm of Rooseveltism. (2) No. Because I do not believe in Special Privilege, nor in the confiscation of $134,000,000 of money that belongs to the taxpayers. To take away the people’s money on the pretext that the Government needs it to pay expenses, and then to deliver it over to a few Pet Banks to be used without interest, is Confiscation. And it’s a burning NATIONAL INJUSTICE AND SHAME! (3) No. Because Congress dare not do it. The people would not stand it. (4) The transportation by the Government, through the mails, of small packages—say one, two, three, four, five, ten, fifteen pounds—at a moderate cost, thus protecting the people from the robber Express Companies. |
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