PAPERS ON FINANCE AND COMMERCE.
PAPERS ON FINANCE AND COMMERCE.
PAPERS ON FINANCE AND COMMERCE.
PAPERS ON FINANCE AND COMMERCE.
There are several propositions which should always remain in all considerations about money, so that the mind may not be led from its true sphere, and so that it may not be invested with peculiarities and characteristics that never did nor never can belong to money:
Firstand most important—most important because it is the determining point which gives all that follows tangibility—is, thatmoney, in its primary uses, is a means and not an end. It is a means, because it was invented to assist the people in performing something that could be performed without, but not so well without it. And this is thesole useof money. Because this has been lost sight of and it has been invested with other functions, it has been possible for it to be converted to uses which at times, in culminating, have almost turned the world topsy-turvy.
Second.Money is the medium of exchanging commodities, and when diverted from its legitimate use and is made an end, results will ever follow whichmustbe detrimental to the general interests involved.
Third.All the material value money possesses is so possessed because of the relation it bears to commodities, that relation being representative of or standing for.
Fourth.While money is the medium of exchanges, and while it is in use representative of valuable materials, it is in itslastanalysis theobjectiveof that department of life of which labor is thesubjective, and, therefore, when scientifically viewed, it resolves itself into a principal which is one of those upon which society must be built when a perfect foundation is formulated.
In providing a currency, therefore, to meet the uses which are demanded of it, itsscientificfeature, as a principle, should be the point of departure, and should be the only guide until it is attained. Labor being the basis of production, is the positive power which reaches forth and expends itself, where money, the other pole of the social battery, is reached; this reaction upon labor completes the circuit, and here is the process which is continually going on: A certain amount of labor—a positive power—produces a certain amount of money or negative resultThe interference with this natural process by extraneous means, through which undue quantities of negative forces are accumulated, is that process which robs labor of its natural and, therefore, just results.
The labor which the people of this country are capable of performing, then, is the real basis upon which money should be formulated, and, as in practice, the results generally are annual in their return, this basis should be measured by all they can produce annually. It follows that the basis upon which money should be uttered is this annual capacity of labor, and there should be sufficient uttered to completely measure this capacity, between which two, when once established, there would be an equilibrium produced, which would only require to be permanently regulated and maintained to insure a perfect harmony in the material interests of society.
For example, let it be supposed that the extremest legitimate amount of currency that would be warranted under the previous rule is one billion of dollars; and that this amount is all that the uses of money require when there is the largest amount of business being transacted. It must be remembered that this is not a redeemable currency, but that it is money; that it is the representative of the wealth of the nation, and that the government, as the head of the nation, has uttered it, upon the soundest and best basis of value any money could possibly have—the productive capacity of the country. In this money system there could be no such thing as the failure of banks to redeem their issues; nor of any loss to be sustained by the individual because of the mismanagement of any board of directors; and what is more than all the rest, in the present systems of society, its value would be sustained by the collective accumulated wealth of the whole country, and it could by no possibility depreciate in value so long as the value of the country was not exceeded by the amount of the issue.
To guard the people against all apprehension of such a result ever being possible, there should be a measure placed upon this currency that will at all times make it just as absolute in its measure of value as the pound is in its measure of weight, or as inches are in their measure of distances. Though this is comparatively a new proposition, and one that but very few minds think a possibility, it nevertheless is just as possible and just as essential—and more so—as all other absolute and arbitrary standards are, that have been invented to give regularity and stability in their respective spheres of use.
This currency—this money—should be made convertible into a United States Bond, which should bear such a rate of interest—sayfour per cent.—as experience has or should demonstrate to be the true point of balance; and the bond should also be convertible into the currency at the option of the holder. The rate of interest should be open to readjustment every ten years, when the estimates for the currency are made. Thus it would come that whenever there should be so much currency in circulation that it would be worth less than four per cent. for business uses, the surplus would immediately be converted into four per cent. bonds; and whenever money for business should be worth more than four per cent., the bonds would be converted into the currency in just sufficient quantities to meet the demand and to restore the equilibrium.
It will be readily seen how perfectly this meets all the requirements of money, and how perfectly all the irregularities of demand and supply are met by it. Thus, when business is dull, and but little money is required, it (the surplus) will be in bonds drawing four per cent. interest; the moment business revives, the bonds will be at once converted, and the currency will meet the demand, and thus the constant conversion of the one into the other will regulate and maintain the equilibrium that all previous systems of money have so signally failed to do.
In our next the advantages of such a system will be still further considered and expounded, so that every one may be able to comprehend that a money system is possible of invention, upon which foreign bankers can not play their long-practiced games to any further one-sided advantage.
New York, Oct. 11, 1870.
New York, Oct. 11, 1870.
New York, Oct. 11, 1870.
New York, Oct. 11, 1870.