PAPERS ON FINANCE AND COMMERCE.
PAPERS ON FINANCE AND COMMERCE.
PAPERS ON FINANCE AND COMMERCE.
PAPERS ON FINANCE AND COMMERCE.
If gold, as a medium of exchange, is behind the requirements of the times—and that it is has been pretty fully demonstrated—some reform should be instituted to supply the failure; some reform—not merely to meet the exigencies of present time and circumstances—which should be inaugurated as a permanent change.
Our government, during the last war, was obliged to resort to what was considered then by nearly all people, and is still considered by many people, as very extreme measures, in order to furnish the material by which the war might be carried on. Without the greenbacks we never could have succeeded as we did. To the person who conceived this project we are as greatly indebted as to our generals, who successfully prosecuted the war upon the means furnished through his financial foresight. This was one means of resorting to the credit of the country. If the credit of the country was sufficiently good to furnish it with the means to carry on such an exhaustive war as ours was, it surely should be good for any peaceful time.
For our part, we cannot see the propriety of returning to specie payment; and there is one insuperable objection to it. Gold cannot furnish the circulating medium for the world, and credit must be resorted to; and the necessity of having two kinds of circulation involves difficulties which the mercantile world would be glad to have forever done with.
Why should people be obliged to use one kind of circulating medium to purchase another kind with, and then use this second kind to pay his debts to another party, who will sell it again to obtain what the first person used to purchase it? This is the logic of specie payments. If it is argued that the actual transfer of the gold is not necessary, we would then ask why is specie payment desirable at all? The facts regarding this question are that people have become wedded to the idea that gold is the only possible thing that can be made money, while alltheir practice has been that it is the least entitled to the name of money of anything they have ever used as such.
As has been said, the real standard value of a country is its capacity to produce, and it is this production that requires to be moved, exchanged, bartered or sold. The use of something to represent this, for which it can stand responsible in general terms, is what is required of money. That kind of money which will best meet all these requirements is the best money. That kind of money which has elasticity, that will be plenty when business is active, and that can be readily put to other use for profit when business is less demanding, is the kind the prosperity of a country demands. With a money of this kind, all financial crises would be impossible. It is the possibility of making a stringent market that unsettles financial matters and causes financial destruction. And it is because we have not a financial system of our own that it is possible for exigencies in other countries to unsettle values here. To-day, the price of our securities in London determines the price of gold here. In view of the possible complications in which Europe is liable to be involved any time, and which she must within a very few years be involved in, it becomes a matter of considerable moment, whether our finances are to be governed and guided by the condition of things there, when these things shall come.
As a nation we are or can be, were it necessary, independent of the world, and are the first and best representative of a republican form of government. Why should we not be the nation to give to the world a reformed currency? The world—or that part of it which has grown to appreciate our kind of freedom—involuntarily turns its eyes to us for patterns of all things that a people during a change of government require. One of the first things a government requires is money. Why shall we not show the nations how to make the best use of their means, and give them a system that will do more for them than any system that has yet been tried, and by so doing also meet our own needs?
The capability to do this would instantly place us at the head of nations, and financially to stand thus, is to complete the measure of our greatness. Politically, we can never be subdued. During our late war there were two millions of men under arms. Just in this proportion, also, should we be powerful financially, and to become so would be to be allotted by the world the lead of it and all its nations.