Notes and Coin Certificates.

Mr. Beck [James Burnie Beck (February 13, 1822 - May 3, 1890), Lexington Kentucky, D; studied law, admitted to the bar]. I now ask that the bill on which I desire to address the Senate be taken up.

The Presiding Officer.  Will the Senator indicate the bill he desires to speak upon ?

Mr. Beck.  Senate bill No.8.

The Presiding Officer.  The title of the bill will be stated.

The Chief Clerk.  A bill (S. 8) to provide for the retirement of United States legal-tender and national-bank notes of small denominations, and the issue of coin certificates in lieu of gold and silver certificates, and for other purposes.

The Presiding Officer.  If there be no objection, the bill will be regarded as before the Senate as in Committee of the Whole.

Mr. Beck.  Mr. President, let the bill be read at length and published in the Record.  I may have occasion to quote parts of it in the course of my remarks.  The bill is as follows:

A bill to provide for the retirement of United States legal-tender and national-bank notes of small denominations, and the issue of coin certificates in lieu of gold and silver certificates, and for other purposes.

Be it enacted, etc., That hereafter no United States note shall be issued of a denomination less than $10 nor more than $500, and the denominations higher than $50 shall not exceed in value one-fourth of the value of the total amount outstanding at any time, and not more than one-fourth in value of the amount of circulation issued to national banks outstanding at any time shall be of a less denomination than $10, and no national-bank note hereafter issued shall be of a higher denomination than $100.  The Secretary of the Treasury is directed to make the changes in the denominations of the legal-tender notes and national-bank notes needed to comply with the provisions of this act, whenever said notes are received at the Treasury for any purpose.

Sec. 2.  That in all issues of certificates hereafter, coin certificates shall be substituted for silver certificates and gold certificates, wherever either is authorized to be issued under existing laws;  and all gold and silver certificates now outstanding shall be retired, when they are received for any purpose at the Treasury or any subtreasury of the United States, and coin certificates of the denominations hereby provided for, issued in their stead;  and the Secretary of the Treasury is hereby authorized and required to issue coin certificates in such denominations, not exceeding $20, as he sees fit, on all the surplus gold and silver coin and gold bullion held at any time by the United States in excess of $100,000,000 of gold coin, and pay out the same in discharge of all the obligations of the United States, except such as have been heretofore made payable expressly in gold and silver coin.

Sec. 3.  That any person or persons may deposit gold or silver coin of the United States in the sum of $10 or any multiple thereof, with the Treasurer of the United States, or with any assistant treasurer, at any United States subtreasury and demand coin certificates of like amount therefor.  It shall be the duty of the Treasurer of the United States, upon the receipt of said money or of any original certificate of deposit issued by the United States assistant treasurer at any United States subtreasury, stating that there has been deposited therein by any person or corporation, gold coin or standard silver dollars of the United States in the sum of $10 or any multiple thereof, to order payment of a like amount in coin certificates, at the counter of any United States depository designated by the depositor, in such denominations as he may request in writing, of not less than $1 or not more than $500, subject to the limitations hereinafter provided, which shall be redeemable in gold or silver coin, at the option of the United States;  and all the certificates hereby authorized, when received at the Treasury in any form or for any purpose, shall be reissued, or new certificates of the same denomination substituted for such as are returned because of being mutilated or defaced, as now provided by law in regard to the notes of the United States.  No coin certificates shall be issued of a denomination greater than $500, and at least two-thirds in value of such certificates outstanding at any time shall be of denominations not exceeding $50.

Sec. 4.  That it shall be the duty of the Secretary of the Treasury to cause a sufficient number of coin certificates of the various denominations hereby authorized, to be prepared and distributed among the United States depositories, to enable them to comply with the provisions of this act;  and the sum of $50,000 is hereby appropriated, out of any money in the Treasury not otherwise appropriated, to enable him to prepare and distribute said certificates.

Sec. 5.  That this act shall take effect ninety days after its passage, except as to the $50,000 appropriated in section 4;  and as to that appropriation, it shall take effect on the passage of this act, and said sum shall be immediately available.

Mr. Beck ---[On January 10, 1872, he voted for the decapitation of the bill which became the coinage act of 1873.  If only, he had been as attentive and present on April 9 and May 27 as he is these days !].  It is a well-known fact that the former policy of this country was to maintain both its gold and silver coin at par with each other, and as full legal tender in payment of all obligations.  Before 1873 there was no distinction made between the metals when coined.  The United States had always treated them both alike.  My proposition now is to restore that equality, by issuing certificates payable in coin on the deposit of either gold or silver coin in the Treasury or in any subtreasury of the United States, and that the right shall be given to any man who may demand it to obtain coin certificates thereon, the option remaining with the Government to redeem the certificates in whatever coin it may be most convenient for us to pay when redemption is demanded.  Believing that until that is done we will have constant troubles about different kinds of currency;  bondholders and bankers contending, as they have always done, that silver and the certificates based on it are only subsidiary and token money, I urge the passage of this bill.

I offered the substance of it as an amendment to an appropriation bill in the last Congress;  it was properly ruled out of order as being legislation on an appropriation bill;  therefore I offered it as an independent measure now and had it referred to the Committee on Finance.  On last Tuesday a bare majority of that committee reported against it.  I gave notice when the report was made that I would call it up to-day and endeavor to push it to a vote.  Whether I can or not in the face of another bill, which is in charge of the Senator from Iowa [Mr. Allison], may be doubtful.  After that notice was given I took part in a discussion on the so-called dependent pension bill, in which I thought it was proper for me to state my reasons for opposing the passage of a measure which involved hundreds of millions of dollars and perhaps increased taxation for forty years;  and in giving my objections to many of the provisions of it, in the course of that speech --for I was led into it by interrogatories-- I presented to the Senate the questions of taxation which would have to be considered in connection with it.  I stated the results that were growing out of our present tariff system by the development of trusts and combinations, when competition was excluded by law, as I thought fairly, going from one proposition to another, following first the questions asked by the Senator from Kansas [Mr. Plumb], then questions asked by the Senator from New Hampshire [Mr. Blair], and then those asked by the Senator from Ohio [Mr. Sherman].  The debate took quite a wide range.  Matters growing out of that debate will require my attention for awhile before I call attention to the bill I have now laid before the Senate, therefore Senators must bear with me while I discuss matters somewhat foreign to the measure I specially desire to advocate.

While showing in my speech [March 1] on the pension bill [S. 181] how we were handicapped in the trade of the world by the cheap silver bullion coined in India, I said among other things that the act demonetizing silver in 1873 was passed so secretly that even the President and several other distinguished gentlemen whom I named knew nothing about it.  I will read now what I then said:

And that was all said to be done in order to protect the American laborer;  he was told that he should accept payment in nothing but gold coin, while the poor, ignorant people of India were willing to take silver.  What brought about this condition of things ?  The Senator from Ohio is more responsible for it than anybody else.  The record shows it.  When Congress undertook to strike down our silver coinage at the dictation of England, and when Germany and England and the United States combined and struck it down secretly, so secretly that General Grant, who was then President, did not know it, though he signed the bill;  Mr. Blaine, the then Speaker of the House, did not know it;  Mr. Garfield did not know it;  Mr. Kelley, who had charge of the bill, did not know it --not one of the Argus-eyed reporters found it out.  He is responsible for it.  Mr. Hooper, of Massachusetts, was chairman of the conference that settled it on the part of the House, and Mr. Sherman was chairman on the part of the Senate.  They knew it.

These remarks seem to have offended the Senator from Ohio [Mr. Sherman].

Before entering on the discussion of that, let me get all the questions I propose to notice now before the Senate.  A resolution was introduced by the Senator from Delaware [Mr. Saulsbury] some time ago, bearing upon the silver question, which, after he addressed the Senate, was laid over at my request, because I announced then that I desired to be heard in regard to it.  I propose to speak to that resolution also at this time.  All of these matters are pertinent to and bear upon each other.  Before speaking of the controversy between the Senator from Ohio and myself, I will ask that Senate joint resolution No. 30, introduced by the Senator from Delaware [Mr. Saulsbury] January 11, entitled "Joint resolution relating to international coinage," may be read and be considered as pending.

It reads as follows:

Whereas, unsuccessful efforts have, on several occasions, been made by the United States to secure the co-operation of European governments in establishing such a fixed ratio of value between the precious metals as would permit their free coinage and circulation in the commercial countries of the world;  and

Whereas the President of the United States, under authority conferred upon him by acts of Congress, recently designated Mr. Edward Atkinson, a citizen of the United States, to visit commercial centers of Europe in order to ascertain the feasibility of establishing, by international arrangements, a common ratio of value between gold and silver, who, after making the investigation required by his appointment, reported among other conclusions the following:

"First.  There is no prospect of any change in the present monetary system of the European states which can modify or influence the financial policy of the United States at the present time.

"Second.  There are no indications of any change in the policy of the financial authorities of the several states visited by me which warrant any expectation that the subject of a bimetallic treaty for a common legal tender coupled with the free coinage of silver will be seriously considered at the present time by them:"  Therefore,

Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That no further effort can properly be made by the United States to obtain the co-operation of European governments in establishing a common ratio of value between silver and gold as money, and the policy of the United States in the coinage of the precious metals should not be influenced by the action, present or prospective, of any foreign government or governments in reference to the relative values of gold and silver as money.

The Senator left out a very important part of the report of Mr. Atkinson in his recital, namely, his third conclusion, in which he says:

There is no indication that the subject of bimetallism has received any intelligent or material consideration outside of a small circle in each country named as a probable or possible remedy for the existence of existing depression in trade.

I deny that the facts stated in that conclusion are true, and propose to give my reasons for saying so.

Not desiring to interrupt the business of the Senate, as the Senator from Kansas [Mr. Ingalls] held the floor at the time when the Senator from Ohio responded [March 6] to what I said in regard to the secrecy with which the act of 1873 was passed, I announced, when his speech was concluded, that I would, when this bill was up, or at an early day, give to the Senate the reasons I had for making the statement I did in regard to the act of 1873 demonetizing silver being passed through so secretly that the gentlemen I named did not know it.  The Senator from Ohio, after quoting what I said, proceeded to remark:

Mr. President, I would not even have regarded this as worthy of notice, as I knew the Senator from Kentucky was under some excitement, but that he uses the word "secretly," intimates that this was done entirely under cover, by some pretense or other, and that I was responsible, selecting me although I had had no connection with the debate in regard to this pension bill.

The Senator from Ohio forgets that while I was discussing questions with the Senator from Kansas and the Senator from New Hampshire, he not only took part in that debate, but for a column or two, as the Record will show, endeavored to deny very many of the statements I had made, how successfully, it is not for me to say.  The first suggestion he made was this:

If trusts only arise out of the tariff, how comes it that there are whisky trusts and some other trusts of that kind in this country, the most formidable and horrible in the country ?

And he followed it up by denying that the tariff had anything to do with trusts or that any protected industries had formed trusts;  and when I read from authentic reports, as I considered them relative to trusts, in regard to steel rails, copper, sugar-refineries, and other matters, he still continued to deny the truth of what I said.  The Record shows that he was taking a very prominent part in that debate, notwithstanding he said he had nothing whatever to do with it.  Coming to the point at issue between us, I said silver was demonetized secretly, and that the President did not know it;  that the Speaker of the House did not know it, and that the distinguished gentlemen I named did not know it.  When I prove that to be true, it is all that it is needed for me to prove in order to justify the remark I made.  When the Senator from Connecticut [Mr. Hawley] denied what I had said, I stated that I would read, as I shall now do, what Judge Kelley, who was the chairman in charge of the bill at the first session, said in regard to it.  He had advocated some change in the coinage at a former session of Congress.  He had discovered that he was wrong, and was not willing to support the measure.  When he afterwards stated his position on the floor of the House of Representatives in regard to it he said --I quote from his speech:

In 1872, when I made the remarks which were cited by those gentlemen, and which have been frequently quoted in both Houses, and always with an air as much as to say that to convict this man of the crime of having been instructed by the logic of events would forever settle this momentous question---

He had evidently changed his opinion in regard to it before its passage.  He adds---

we were not using coin, and no gentleman in either House appears to have appreciated the scope and magnitude of the silver question or to have given it special study.  Hence the bill --and I wish gentlemen to know what that bill was;  it was a bill to reorganize the mints, not to revise the coin money of the country, but to reorganize the mints, and it was passed without allusion in debate to the question of the retention or abandonment of the standard silver dollar.  The then Speaker of the House [Mr. Blaine], now a distinguished member of the Senate, and Hon. Mr. Voorhees, of Indiana, who is also a member of that body, were then members of this House;  and during the last Congress this colloquy occurred between them.  It was, I think, denied by Mr. Voorhees that members of the House knew that the bill proposed to demonetize the silver dollar, and to sustain his view he said to the ex-Speaker:  "Did you know it, sir ?"  "No," said Senator Blaine;  "did you ?"  "No," replied Senator Voorhees.

I was chairman of the committee that reported the original bill, and I aver on my honor that I did not know the fact that it proposed to drop the standard dollar, and did not learn that it had done it for eighteen months after the passage of the substitute offered by Mr. Hooper [that would be May, 1872 + 18 = November 1874], when I disputed the fact, and was shown the law.  The distinguished gentleman from Ohio [Mr. Garfield] who now leads this side of the House was then, as now, an attentive and already a distinguished member of the House;  yet when in joint debate [with Pendleton] before the people of Ohio in October, 1877, the question arose as to who was responsible for its demonetization, he frankly said he did not know that such a provision was in the bill when it passed the House.  I state this the more freely in his absence because I informed him that I intended to do so;  and he replied, "It is the case;  I did make that statement, and it is true."

Nor did the President who signed the bill know that it abolished legal-tender standard silver dollars, for in his letter to Mr. Cowdrey of October 6, 1873, cited by the gentleman from Ohio, [Mr. Warner,] he said:

"Silver will gradually take the place of this currency, and, further, will become the standard of values, which will be hoarded in a small way.  I estimate that this will consume from $200,000,000 to $300,000,000 in time of this species of our circulating medium. * * * I confess to a desire to see a limited hoarding of money.  It insures a firm foundation in time of need.  But I want to see the hoarding of something that has a standard value the world over.  Silver has this."

The last clause was the language of President Grant writing to a friend nearly nine months after he had signed the bill.  Therefore I insist that I have even now made good every word I said, through the mouth of Mr. Kelley, and have shown that Mr. Blaine did not know of the passage of the bill, that General Grant did not know it, Mr. Garfield did not know it, and Mr. Kelley did not know it, and that not one of the Argus-eyed reporters found it out.  That is true, as the papers that they reported for every day will show.  I have gone to the files in Mr. Spofford's office and examined them, and not one of them referred to it, not one of them suspected it, not one of them alluded to it, that I could discover.

But I was saved a great deal of trouble by a witness that I knew nothing about, or at least did not think of at the time, who was a member of the Senate then.  I refer to the very intelligent Senator from Nevada [Mr. Stewart], whose State was more interested than any other;  he was here vigilant, attentive, in looking after the interests of his people.  He was in the Senate when that bill of 1873 passed and after the Senator from Ohio found fault with the fact that I said it was done so secretly that it was not known by any of the leading gentlemen I named, and, as I insist, is proved by Mr. Kelley, the Senator from Nevada rose in his place in this body the other day [March 8] in the presence of the Senator from Ohio, and, after quoting what the Senator from Ohio had said about my remarks, proceeded to remark:

I was in the Senate at the time that bill was passed, and in the course of his remarks the Senator from Ohio alluded to that fact.  I think it would be well for every member of Congress if he could plead that he was entirely ignorant of that transaction.  I do not believe that it is to the credit of any man to have knowingly done what was then done.

And again he said:

In view of this, and notwithstanding the enormous contraction which was necessary, at the time the rebellion failed and peace was declared, to spread the currency then existing all over the country, the South as well as the North;  notwithstanding the enormous contraction subsequently required in reaching specie payments;  notwithstanding we had agreed to pay the bonds in coin, the bondholders were not satisfied;  they demanded payment in gold alone.  Is it possible that any Senator who ever occupied a seat in this Chamber would have openly declared that it was his purpose to take from the people the right to pay these bonds in silver as well as gold ?  Will any Senator say that the bondholder was not sufficiently favored by increasing the value of his bonds more than 50 per cent. by the acts which had been passed before the world was robbed of more than half of its circulating medium by the demonetization of silver ?  Is it possible that any Senator now lives who will attempt to justify the act of February 12, 1873 ?  I feel that the fact that I was in this Chamber when that act passed requires from me an apology.

Let the Senator from Ohio answer the Senator from Nevada, if he can.  The language used by that Senator is infinitely stronger and reflects with far greater severity on the men who passed that bill than anything I said, so that I feel relieved from all responsibility.  Still I think I was justified the other day when, not finding the Senator in his seat, I said:

I will say, however, so that the Senator from Ohio can see it in the Record, that after I read to him the speeches of the Senator from Iowa [Mr. Allison], in regard to how that act was doctored, and the speech of the Presiding Officer, the Senator from Kansas [Mr. Ingalls], and the speech made by Mr. Howe in the Senate, in which he said --I will only read two lines:  "Mr. President, I do not regard the demonetization of silver as an attempt to wrench from the people more than they agreed to pay.  That is not the crime of which I accuse the act of 1873.  I charge it with guilt compared with which the robbery of two hundred millions is venial"---

Mr. Howe was a member of the Senate at the time the act was passed---

and after I read to him what has been said by the Senator from Indiana [Mr. Voorhees] and other gentlemen, I think he will be content to say that my expressions were very mild in regard to the secrecy with which that measure was pushed through Congress.

Returning to the speech of the Senator from Nevada, he said:

As to the history of the bill of which I have been speaking, I think I am safe in saying that the Senate passed it in ignorance of its contents or effect;  that nobody knew its effect;  that nobody knew that one-half of the world's money was to be put out of existence;  that the creditor class was to be vastly benefited;  that the prosperity of the world was to be checked by the measure which the Senator from Ohio declared was "debated for three long sessions, considered line by line, and precept by precept."

There was at that time in the civilized world twenty-five thousand millions of indebtedness, and that indebtedness was by contract payable in either gold or silver, and I do not believe that any Senator here thought he was becoming a party to a new contract by which that vast sum should be paid in gold alone.

Again the Senator from Nevada said:

I have examined this discussion and there was no debate in regard to the discontinuance of the coinage of the silver dollar.  The bill was an elaborate one to codify the mint laws.  There was no discussion whatever in regard to coins of any kind.  The discussion was as to other matters, the salaries of officers, etc.

Again he said:

If the daylight of which the Senator from Ohio speaks had been let in upon the designs of the bondholders of Europe and America, the silver dollar would never have been demonetized.  No man in either House of Congress would have sought the bad eminence which he would have attained by voting for the act of February 12, 1873.

The Senator from Nevada also showed that two years afterwards President Grant sent a special message to Congress, in January, 1875, on the day he signed the specie resumption act, which proved that he was utterly ignorant of the fact that silver had been demonetized by the act of 1873.  Listen to his recommendation two years after the passage of the bill in question:

In fact, to carry out the first section of the act, another mint becomes necessary.  With the present facilities for coinage it would take a period probably beyond that fixed by law for final specie resumption to coin the silver necessary to transact the business of the country.

There are now smelting furnaces for extracting the silver and gold from the ores brought from the mountain territories in Chicago, St. Louis, and Omaha --three in the former city-- and as much of the change required will be wanted in the Mississippi Valley States, and as the metals to be coined come from west of those States, and, as I understand, the charges for transportation of bullion from either of the cities named to the mint in Philadelphia, or to New York City, amount to $1 for each $1,000 worth, with an actual expense for transportation back, it would seem a fair argument in favor of adopting one or more of those cities as the place or places for the establishment of new coining facilities.

The increased mints were supposed to be necessary to coin silver.  Then the Senator from Nevada very properly asked:

Did the Executive understand when he made this recommendation that silver had been demonetized ?  Did the light of day in which the Senator from Ohio alleges the bill was passed reach and illuminate the Executive Mansion ?

But when the secret history of this bill of 1873 comes to be told, it will disclose the fact that the House of Representatives intended to coin both gold and silver, and intended to place both metals upon the French relation instead of our own, which was the true scientific position with reference to this subject in 1873, but that the bill afterward was doctored, if I may use that term and I use it in no offensive sense of course---

Mr. Sargent interrupted him, and asked him what he meant by the word "doctored."  Mr. Allison said:

I said I used the word in no offensive sense.  It was changed after discussion, and the dollar of 420 grains was substituted for it.  I have here, if the Senator from California doubts what I say, the report of Mr. Ruggles to the Chamber of Commerce of the city of New York, showing that it was the original intention of the promoters of the bill of 1873 that both silver and gold should be coined, and that they should be placed upon the French ratio.

And, by the way, Mr. Ruggles cuts a very important figure in this matter, as I will show before we get through with it.  He was the exponent of the views of the Chamber of Commerce of the city of New York.  Mr. Allison insists that the original intention of the promoters of the bill of 1873 was that both gold and silver should be coined again.  I doubt that.  I read again from the Senator from Iowa, which answers another part of the speech of the Senator from Ohio, who says silver never cut any figure in our coinage:

I cannot understand why it is that this objection has been made so strenuously and so continuously.  We had nothing but a silver currency until 1834 practically.  The debts of the Revolution and the debts of the war of 1812 were paid almost exclusively in silver coin, because we overvalued silver and undervalued gold, the latter disappeared and left us only silver.  We not only made our own silver dollars and half dollars and all fractional silver a full legal tender, but we made all the silver coins then current in the world's commerce legal tender in our country.  From 1792 up to 1827, and again by the legislation of 1834, silver coins of Mexico and the South American States and of France and Spain were made a full legal tender in this country, and some of them continued to be a full legal tender until 1857.  Therefore for nearly seventy years of our country's history we not only had a legal tender of our own silver, but the silver of other nations was a full legal tender in our country.

Yet Senators say silver has played but an insignificant part in the great work of distributing the products of our country, and in our exchanges;  and they triumphantly say there were only eight millions of silver dollars coined at our Mint from 1792 to 1873.  We had of full-coined silver money more than a hundred millions coined at our Mint between those periods, I think $140,000,000, and we had all the silver of the world made legal tender in addition.  Mr. Moore, the Director of the Mint at Philadelphia, stated in his report of 1832 that there were only $500,000 of gold money in the United States and that all the rest was silver.  Yet we have the insignificant pretense made here day by day that silver has never played a prominent part in the history of our money.

I will now refer to what Senator Howe, who was in the Senate at the time, said in regard to it and repeated over and over again in the course of his speech.  He was then Senator from Wisconsin, afterwards Postmaster-General, and a member of the commission that was subsequently sent to Europe to negotiate in regard to coinage.

Sir, we have no authority for saying that 412½ grains of silver are worth intrinsically less than 25.8 grains of gold.

This speech was made in 1878, when the remonetization act was being discussed.

The former, I grant, brings less in the English and in the German markets than the latter, because England and Germany both proscribe silver and patronize gold.  The silver brings less in our own markets.  We have transmuted both into commodities, and accordingly we value both as we value our wheat, according to what they will bring in other markets.  We cannot regulate the price of either metal in foreign markets;  we can regulate the price of both in our own markets.  Restore both to the rank of money, and while they remain money they will have precisely the same authority.  If you wish to send either abroad it will go not as money but as a commodity, and you will always naturally send whichever is most capable in the market to which you remit.

Mr. President, I do not regard the demonetization of silver as an attempt to wrench from the people more than they agreed to pay.  That is not the crime of which I accuse the act of 1873.  I charge it with guilt compared with which the robbery of two hundred millions is venial.

The stock of coin in the whole western world was estimated in 1870 at 3,700,000,000.  Of that sum $1,275,000,000 were estimated to be in silver.  About that time the conspiracy seems to have been formed to withdraw from that circulation the silver in it;  that is, nearly one-third of the whole stock.  But when you expel one dollar of coin from the circulating medium you compel the retirement of all bank issues based upon it, and you shrink the value of commodities measured by it.

I shall not detain the Senate by narrating the growth of this conspiracy.  A large part of Europe is already in it.  France, it is said, joined it since this debate commenced.  The practical question before us is, shall the United States become a party to it ?  for one, I decline.

Sir, this is not contraction;  this is strangulation.  This is not a question of heaping burdens upon the labor and enterprise of the people.  It is an attempt to paralyze that labor and that enterprise.  It is not a proposition to add 10 per cent. to the obligation of the public debt.  It is a deliberate effort to blast 33 per cent. of the ability of the people to pay the debt.

I might add other quotations from him even stronger than those I have read, but I do not care to take the time.  I will read this, however:

But after all we are asked, why not put into the silver dollar the present commodity value of the gold dollar ?

That has long been one of the favorite cries of the Senator from Ohio, both as Secretary of the Treasury and as a Senator in Congress, and his followers have continued to repeat the cry.

I answer, for many and most commanding reasons.  First, debts, public and private, are contracted aggregating thousands of millions.  Each dollar is payable by 412½ grains of silver.  You have no right to compel the delivery of 440 or 454 grains for each dollar.  That is filching;  only a few hundred millions, to be sure, but it is filching.

Secondly.  Putting in that quantity of silver would make the measure a felo de se.  The great object I aim at is to restore silver to that standard by which you measure the labor and the products of the world and to that medium by which you exchange the products of the world, and therefore I ask you to coin it into money once more.  You say --yes, if you are allowed to put more into a dollar than can be procured for a dollar.  Who does not see that silver can not be coined upon such terms ?  Daily we are told by the opponents of the bill that when the coinage act of 1873 was passed, silver dollars were not coined because 412½ grains could not be afforded for a dollar.  This nation and other nations denounced silver as money, and it fell in the market.  Now you generously offer to restore it at 454 grains to the dollar.  When silver was money we could not get 412½ grains for a dollar in gold;  we demonetized it;  we can now buy, you say, 454 grains for a gold dollar.

So you will consent to remonetize silver at that rate ?  Suppose once more all existing contracts for dollars were, instead, contracts for so many bushels of grain;  that grain had in 1873 been recognized by commercial nations to include both barley and wheat, and both had commanded substantially the same price in the markets.  Suppose then we had degrainetized barley;  had enacted that it should not be deliverable on grain contracts.  Of course the demand for barley would thereby greatly diminish;  its price would decline.  As the demand for wheat would correspondingly increase, its price would rise.  Suppose we had watched the rise of wheat and the fall of barley until two bushels of the latter would only buy one of the former.  Suppose there came to us then, as there would be sure to come, a cry like that we hear now:  "The world can not produce the wheat to fill our grain contracts;  barley is abundant, and for it there is little use.  In the name of mercy regrainetize barley."  Can any one who knows the honorable chairman of the Committee on Finance conceive that he would respond to such a demand, "Yes, we will permit you to deliver barley for grain once more, provided you will deliver two bushels for one"

No one has ever answered in a plainer or clearer way the objection of the Senator from Ohio that there is not now silver enough put into the standard silver dollar.  It is the dollar which we and all our creditors agreed should be the dollar in all our obligations.  The Senator from Kansas [Mr. Ingalls], the present President of the Senate, also made a speech.  It will be seen that I am not alone in speaking of the act of 1873 having been secretly passed.  The Senator from Kansas on this floor on the 15th of February, 1878, said:

But there is strong evidence that the destruction of the legal-tender power of silver was the culmination of a scheme long entertained by the holders of the public debt of this country, devised by them for the purpose of appreciating the value of their investments, regardless of the ruin and desolation which it would bring upon the laboring and productive classes of the nation.

Have I said anything stronger than that ?

In a report made to the Senate June 9, 1868, to accompany a "bill in relation to the coinage of gold and silver," Mr. Sherman, now Secretary of the Treasury, said:

"The single standard of gold is an American idea, yielded reluctantly by France and other countries where silver is the chief standard of value."

Mr. Ingalls proceeds:

No statement emanating from authority so respectable could well be more devoid of truth.  The original American idea was a single standard of silver.  Gold was an innovation, and, in my judgment, a grave mistake.  The assertion of Senator Sherman that the single gold standard was an "American idea" is so singularly incorrect that it seems almost like a premeditated preliminary to the fatal error of 1873.

There were other things said by that Senator, and said very well, that I have not time to read.  There is one thing that perhaps I ought to read for his benefit now, which I hope when some other issues come up he will bear in mind.  The Senator from Kansas [Mr. Ingalls] said:

We cannot disguise the truth that we are on the verge of an impending revolution.  The old issues are dead.  The people are arraying themselves upon one side or the other of a portentous contest.  On one side is capital, formidably intrenched in privilege, arrogant from continued triumph, conservative, tenacious of old theories, demanding new concessions, enriched by domestic levy and foreign commerce, and struggling to adjust all values to its own standard.  On the other is labor, asking for employment, striving to develop domestic industries, battling with the forces of nature, and subduing the wilderness;  labor, starving and sullen in cities, resolutely determined to overthrow a system under which the rich are growing richer and the poor are growing poorer;  a system which gives to a Vanderbilt the possession of wealth beyond the dreams of avarice and condemns the poor to a poverty which has no refuge from starvation but the prison or the grave.

He goes on to show that the remonetization of silver was an indispensable prerequisite to the restoration of the prosperity of the country, and he was right.

The Presiding Officer.  The Senator will suspend, that the Chair may lay before the Senate the unfinished business, being Senate bill No. 977.

Mr. Harris.  I ask that the unfinished business be informally laid aside, so that the Senator from Kentucky may proceed.

The Presiding Officer.  If there be no objection, the unfinished business will be informally laid aside.  The Chair hears no objection.  The bill of the Senator from Kentucky remains before the Senate, on which he is entitled to the floor.

Mr. Beck.  I thank the Senate for its courtesy.

A few more words which may well be considered in the struggle in regard to taxation that is coming in the near future.  I read from the Senator from Kansas:

If the bonds of this Government---

He had shown that the holders were all demanding that they should be paid in gold alone, although, according to the contract, silver was by law an equal factor with gold in their payment.

If the bonds of this Government are paid they will be paid by the labor of the country, and not by its capital.  They are exempt from taxation and bear none of the burdens of society.  The alliance between the West and the South upon all matters affecting their material welfare hereafter is inevitable.  Their interests are mutual and identical.  With the removal of the causes of political dissension that have so long separated them, they must coalesce, and united they will be invincible.  The valleys of the Mississippi and Missouri, with their tributaries, form an empire that must have a homogeneous population and a common destiny from the Yellowstone to the Gulf.  These great communities have been alienated by factions that have estranged them only to prey upon them and to maintain political supremacy by their separation.  Unfriendly legislation has imposed intolerable burdens upon their energies;  invidious discriminations have been made against their products;  unjust tariffs have repressed their industries.

I come now to the Senator from Indiana [Mr. Voorhees].  The Senator from Indiana made a great speech on that occasion [January 15].  The Senator from Ohio will perhaps have something to say about his remarks.  Senator Voorhees said:

The silver dollar is peculiarly the laboring-man's dollar, as far as he may desire specie.  When specie payments were authorized before the war it was the favorite currency with the people, and it will be so again whenever a general circulation of coin is obtained, if that shall ever happen.  Throughout all the financial panics that have assailed this country no man has been bold enough to raise his hand to strike it down; no man has ever dared to whisper of a contemplated assault upon it; and when the hour of its danger and destruction drew nigh, when the 12th day of February, 1873, approached, the day of doom to the American dollar, the dollar of our fathers, how silent was the work of the enemy !  Not a sound, not a word, no note of warning to the American people that their favorite coin was about to be destroyed as money; that the greatest financial revolution of modern times was in contemplation and about to be accomplished against their highest and dearest rights !  The tax-payers of the United States were no more notified or consulted on this momentous measure than the slaves on a southern plantation before the war, when their master made up his mind to increase their task or to change them from a corn to a cotton field.  Never since the foundation of this Government has a law of such vital and tremendous import, or indeed of any importance at all, crawled into our statute-books so furtively and so noiselessly as this.  Its enactment there was as completely unknown to the people, and indeed to four-fifths of Congress itself, as the presence of a burglar in a house at midnight is to its sleeping inmates.

I believe he was equally as forcible in his expressions as the Senator from Nevada was the other day, though not as personal:

This was rendered possible partly because the clandestine movement was so utterly unexpected, and partly from the nature of the bill in which it occurred.  The silver dollar of American history was demonetized in an act entitled "An act revising and amending the laws relative to the mints, assay offices, and coinage of the United States." The avowed and ostensible purpose of this act is set forth by Dr. Linderman, the Director of the Mint, in his recent work on Money and Legal Tender.

I might read from the speeches of other Senators;  but the Senator from Texas [Mr. Coke] has broad shoulders, and the Senator from Ohio may, perhaps, like to make some complementary remarks in regard to the way he talked about the act of 1873.  The Senator from Texas said:

The bankers, capitalists, bondholders, and syndicates of England and Germany and the other European states which have followed their lead in demonetizing silver, and who mainly hold and own or control the enormous indebtedness due by all the world to these great creditor nations, were the movers and promoters of the policy of degrading and demonetizing silver, of course for the purpose of magnifying and increasing the value and purchasing power of the gold which they exacted from debtors.  The passage of the act of February 12, 1873, taking away the right of free coinage of silver, and the adoption of the Revised Statutes in June, 1874, by the Congress of the United States, taking away the legal-tender quality from the silver dollar, completed the demonetization of silver in this country and established the gold standard.  No greater outrage was ever perpetrated under the forms of law than these enactments which demonetized silver.

The first, so artfully embodied in a long bill of sixty-seven sections, that General Grant, then President, who approved the bill, did not know of it, and is shown by his well-known letter to Mr. Cowdrey, written seven months afterward, which I will not read here because every Senator has seen it, and the last contained in the Revised Statutes, which were enacted in bulk upon the assurance of the revising committee that no new matter had been inserted.  The subject had not been discussed before the people or by the press, had not been debated in Congress, had not been considered by the country, and the people, as well as the President who approved the bill, were utterly ignorant of what had been done for many months afterward.  Had the people been aroused to a knowledge of the fact in time this effort to despoil them would have been overwhelmed with defeat.

When England demonetized silver the American silver dollar was worth 103 cents in gold.  When Germany demonetized silver in 1871 the same dollar outvalued gold the same per cent., and when silver was fraudulently and surreptitiously demonetized in the United States in 1873 it outvalued gold to about the same extent.  It was not demonetized because it was a cheap dollar or a dishonest dollar, as is alleged against it now, for it was worth more than gold.  The great creditor nations, England and Germany, with the lesser European states which joined them in their policy, demonetized silver on a cold calculation that by destroying one-half of the world's money the other half would be greatly increased in value, and the creditor section of this Union, where the great national and other banks are, where the Government and other bonds, State, railway, municipal, and corporation, and four-fifths of the gold coin and other active banking capital of this country are found, demonetized silver in the United States in 1873 on exactly the same sort of calculation.

The Senator from Colorado [Mr. Teller] took part in the controversy.  I have skipped the Senator from Alabama [Mr. Morgan] and the Senator from Texas [Mr. Reagan], who were not very much milder in their form of expression than the others.  I want to show the Senator from Ohio that my form of expression was mild compared with what several other Senators had said.  The Senator from Colorado [Mr. Teller] said:

The creditor class, always powerful in affairs of state, controlled the legislation as well as the financial affairs of the world.  The destruction of one-half of the money of the world would enhance the value of all of these securities.  Is it very strange that the common people of all nations, deeply absorbed in their efforts to pay their interest and escape from their debts, did not interfere in the attempt to lessen all value except that of gold ?  Thus the demonetization in Germany did not call from that class a protest any more than the act of 1873 did from the people of the United States, who were busy in trying to save something from the wreck produced by overspeculation and overcredits, and were suffering from stagnation in business produced by a want of real money to carry on the legitimate business of the country and did not discover that silver was demonetized until months after it was done.

The Senator from North Carolina [Mr. Vance] was pretty emphatic in his remarks in regard to it.  But perhaps I have read enough.

Mr. President, I submit that if there is any weight in human testimony and the testimony of Senators of the highest character, neither they nor the American people knew that silver coin was stricken down as it was by the act of 1873;  and while the Senator from Ohio read what had been said in public and private reports --and he may read all sorts of reports as to how often the bills were printed, how many committees they were referred to, and what was done about them-- he has failed to show, and he will always fail to show, that the American people or their representatives in either House knew that silver was stricken down by the act of 1873, or that any debate occurred on the bill that was passed to call their attention to it;  the records will not enable him to do it.  The statement of the Senator from Nevada, on this floor the other day settles that.

I have turned to the Record.  I was a member of the other House at that time.  I can prove, I think, by the Senator from Massachusetts [Mr. Dawes], who was chairman of my Committee on Ways and Means at that time, that I was an ordinarily vigilant member in regard to public affairs.  I did not know it, and never suspected it, and I have conversed with Mr. Holman, of Indiana, who was then in the House, and he told me, and he has said over and over again in the House and elsewhere, that he had no suspicion that it was done.  He has never been suspected of lack of vigilance.  Of course it was known that the Comptroller of the Currency, the Director of the Mint, and their allies, foreign and domestic, were scheming to appreciate the value of the bonds, and of course the committee in Congress and those who were watching these questions knew that schemes for the demonetization of silver had been presented more than once, but had never met with any favor among the representatives of the people.

The record shows that early in April, 1872, the bill had been made a special order from day to day.  Mr. Potter, of New York, was a member of the committee.  The record shows that, while the coinage provisions were contained in the fifteenth and sixteenth sections, the House had only reached the ninth section when Mr. Potter developed the fact that there was a proposition in the bill, and there would be an effort to strike down silver coinage.  As I said, the bill was the special order from day to day, yet as soon as Mr. Potter developed that fact, although he said he believed in gold, and gold alone, as the unit or standard of value, yet he was opposed to making any change in our coinage at that time, as the attention of the country had not been called to it, the House dropped even the consideration of the bill any further, and it lost its place.  It never was called up from the 9th of April until the 27th of May, 1872.  Both Houses of Congress had before that day agreed to adjourn on the 29th of May.  Mr. Potter, of New York, had gone home.  He was the member on the Democratic side who was watching it.  He was on the committee and had avowed that he would not allow it to pass.  Mr. Hooper, of Massachusetts, in Mr. Potter's absence, offered what he said was a substitute for the bill, and not the objectionable bill that Mr. Potter had advised against, though it turned out, as Mr. Sherman now proves, that his statement was untrue.  Mr. Hooper came to Mr. Kerr, of Indiana, Mr. Holman, myself, and others, and he assured all of us, as Mr. Holman will tell any one, and as I know, that his substitute was simply a bill regulating mints.  Mr. Brooks was not willing to believe him.  He said his colleague from New York, Mr. Potter, was gone.  Here is the record.  It is all recorded in less than half a page, as you will observe, in the Congressional Globe, part 5, second session Forty-second Congress.

Let it be remembered that this occurred within forty-eight hours of the final adjournment of the House for the session when motions to suspend the rules were in order, and everybody was trying to get bills through on suspension.  Mr. Hooper tried to suspend the rules and pass the bill without reading it.  That was objected to.  Finally it was ordered to be read, and the Clerk "began reading it."  That is all the record shows.  Whether it was read in full or not, I do not care to say.  Those who were there with whom I have conversed do not believe it was.  But I care nothing about that.  We all heard, or are presumed to have heard, an important bill read here half an hour ago in regard to the courts, and there was not a man in this Senate, unless the Senator from Iowa [Mr. Wilson], who knows what it meant.  I venture to assert that there are not five Senators who can tell what that bill was that was read a half hour ago.  Therefore I say I do not care whether the bill was read in the then confusion of the House or not.  The record shows that Mr. Brooks said:

My colleague from the Westchester district [Mr. Potter] stated the other day that this bill provided for the recoinage of more or less of the small currency of the country and the creation of a new currency.

Mr. Hooper, of Massachusetts.  That is not the case with the bill as it now stands.

That satisfied Mr. Brooks and corresponded with what Mr. Hooper had told many of us privately.  Mr. Kerr was still partly dissatisfied, and Mr. Holman, at his request as I recollect it, put the question to Mr. Hooper, who was standing in front of the desk:

Before the question is taken upon suspending the rules and passing the bill I hope the gentleman from Massachusetts will explain the leading changes made by this bill in the existing law, especially in reference to the coinage.  It would seem that all the small coinage of the country is intended to be recoined.

Mr. Hooper's attention was called especially to the coinage.  Mr. Holman also feared that all the small currency of the country was intended to be recoined, which would be a costly operation.

Mr. Hooper, of Massachusetts.  This bill makes no changes in the existing law in that regard.  It does not require the recoinage of the small coins.  On the contrary, I understand that the Secretary of the Treasury proposes to issue an order to stop the coinage of all the minor coins, as there is now a great abundance of them in the country.  The salaries are not increased.  They remain as they were.

That was satisfactory, and the bill, which was believed to be a substitute with all the objectionable features as to coinage and changes stricken out, was allowed to pass almost unanimously.

The record flatly contradicts Mr. Sherman's assertion that the Hooper substitute, which passed, was ever discussed or considered, and proves my assertion that it was passed without members knowing what it contained.  I might add that they were deceived in regard to its provisions.

On the motion to suspend the rules and pass the bill the vote was 110 yeas to 13 nays.  Not a word was said about striking down the silver dollar.  Now, is it true that the bill finally passed, as stated the other day by the Senator from Ohio, because silver was worth 3½ per cent. more than gold, and therefore the silver dollar was sought to be reduced from 412½ grains to 384 grains ?  I have stated how the bill was passed, and nine-tenths of the members then in the House will prove what I say is true.  Of course, the provision striking down the silver dollar and reducing its legal-tender quality was in it, but the members of the House, except a favored few, were kept in ignorance of the fact.

The bill went to the Senate, reaching there on the day of final adjournment for the session.  I have the bill in my hand as it finally passed in conference.  I received it this morning from the file clerk, together with the report of the committee of conference, with all the changes made after it reached the Senate, with marks showing what the conference agreed to.  I do not care to read details.  It would take too long.  All the provisions of the House bill in regard to reducing the value of the silver dollar, because, as the Senator said, the old silver coin was worth 3 per cent. more than gold, which was the pretense on which he said they were acting, were stricken out, the old dollar was dropped, and a trade-dollar of 420 grains substituted.

Mr. Sherman.  I will ask the Senator from Kentucky now to read in his speech the section of the bill in regard to coinage as it came from the House of Representatives, and then as it was proposed in the Senate.  He has before him now the document which shows the proposition of the House of Representatives as it came to us.  Let that be printed and then let the proposition of the Senator be printed side by side.

Mr. Beck.  Here they are, sections 12, 14, and 15.

Mr. Sherman.  I hope the Senator will have that done.

Mr. Beck.  I will.  With the consent of the Senate, I will have that done.

Mr. Sherman.  Let them be read.

They are as follows:

The proposition of the House was:

"That the silver coins of the United States shall be a dollar, half-dollar or fifty-cent piece, a quarter-dollar or twenty five cent piece, and a dime or ten-cent piece;  and the weight of the dollar shall be three hundred and eighty-four grains;  the half-dollar, quarter-dollar and the dime shall be, respectively, one-half, one-quarter, and one-tenth of the weight of said dollar;  which coins shall be a legal tender, at their nominal value, for any amount not exceeding five dollars in any one payment."

The Senate substitute, which was adopted, reads:

That the silver coins of the United States shall be a trade-dollar, a half-dollar, or fifty-cent piece, a quarter-dollar, or twenty-five-cent piece, a dime, or ten-cent piece;  and the weight of the trade-dollar shall be four hundred and twenty grains troy;  the weight of the half-dollar shall be twelve grams and one-half of a gram;  the quarter-dollar and the dime shall be, respectively, one-half and one-fifth of the weight of said half-dollar;  and said coins shall be a legal tender at their nominal value for any amount not exceeding five dollars in any one payment.

Then follows---

Sec. 18.  That no coins, either of gold, silver, or minor coinage, shall hereafter be issued from the Mint other than those of the denominations, standards, and weights herein set forth.

Mr. Beck.  The final change was made from 384 grains, as the House bill proposed, to a trade dollar of 420 grains, which was 7½ grains more valuable than the original standard silver dollar, whose legal-tender quality they were so eager to destroy.

Mr. Sherman.  In other words, the dollar, not the dollar of the fathers, not the dollar of 412½ grains, but the token dollar of 384 grains, was provided for in the House bill.

Mr. Beck.  Provided for by Mr. Hooper and one or two other men who denied that they were providing for it.  The House never knew anything about it.  Mr. Blaine proved that;  Mr. Kelley has shown that;  Mr. Garfield, over and over again, proved that;  and the Record shows that he was present in the House taking part in the proceeding when it was done.  That provision was inserted reducing the silver dollar from 412½ to 384 grains by a few men who denied that they were doing it.  That was what I contend, and I think I have proved it.  Of course they got it in, else the scheme would have failed.

Mr. Sherman.  But what I wish is to have the proposition of the House printed, and then side by side the proposition of the Senate, which lay upon our table more than two months, and has been read over and over again.

Mr. Beck.  What I complain of, and what I think I have proved, is that the House never knew what was in that bill.  The bill was offered as a substitute for all former bills, and it was vouched for by Mr. Hooper, who presented it, that it had nothing to do with coinage.  It was upon the faith of that statement the House allowed it to pass, and the House was deceived.

The Senate amendment is a curious commentary on what the Senator from Ohio the other day said about the old silver dollar being deliberately demonetized because it was more valuable than gold.  When the bill came into his hands, as chairman of the committee he struck out the provision which the House bill contained reducing the dollar because of its overvaluation;  he left no such dollar in the bill, but inserted another dollar altogether;  one of 420 grains, or 7½ grains more silver than the original 412½ grains, which he said was worth 3½ per cent. more than gold;  and the bill was sent back to the House, and, so far as I can find by searching the Record, the House was never told of the change.  What occurred when it got back to the House ?  It was sent at once to a committee of conference.  I turn to the Record again, part 2, third session 42nd Congress, page 1189, under the heading "Mint laws:"

Mr. Hooper, of Massachusetts.  Mr. Speaker, I rise for the purpose of submitting a report of a committee of conference, which I ask the Clerk to read.

That was this report, which no man could by reading tell what it meant unless he had the bill carefully before him.  Signed by the conferees.

The report was adopted.

Mr. Hooper, of Massachusetts moved to reconsider the vote by which the report was adopted;  and also moved that the motion to reconsider be laid on the table.

That is all the House ever did know.  The House was never told, so far as the record shows, that I can find, that the Senate had changed the bill from a bill reducing the value of a silver dollar to a bill creating a new dollar altogether, one of 420 grains instead of 384 grains.

When it came to the Senate, the Senator from Ohio had charge of it, and it is headed again "Mint laws."

Mr. Sherman submitted the following report.

The report was concurred in, with not one word said about it, so that neither House had any opportunity, so far as these reports show, to know what they were doing.

I need not waste time in regard to what took place when the House bill reached the Senate.  The Senator from Nevada [Mr. Stewart] has shown very fully what took place there.  If the Senator from Ohio is content with that statement I am.  Mr. Casserly, of California, was in the Senate and other able and distinguished representatives of silver-producing States.  Mr. Corbett, of Oregon, and others took part in the debate.  Will any sane man believe that they deliberately consented to strike down silver coinage ?  Mr. Sherman says they all did.  I do not believe him.  When the House bill was brought up by Mr. Sherman, the Record shows that he used this language:

Mr. Sherman.  I rise for the purpose of moving that the Senate proceed to the consideration of the Mint bill.  I will state that this bill will not probably consume any more time than the time consumed in reading it.  It passed the Senate two years ago after full debate.  It was taken up again in the House during the present Congress, and passed there.  It is a matter of vital interest to the Government, and I am informed by officers of the Government it is important it should pass promptly.  The amendments reported by the Committee on Finance present the points of difference between the two Houses, and they can go to a committee of conference without having a controversy here in the Senate about them.

Again he said:

Mr. Sherman.  If the Senator will allow me, he will see that the preceding section provides for coin which is exactly interchangeable with the English shilling and the five-franc piece of France;  that is, a five-franc piece of France will be the exact equivalent of a dollar of the United States in our silver coinage;

That was stricken out, and there was no such thing left in the bill.

and in order to show this wherever our silver coin shall float --and we are providing that it shall float all over the world-- we propose to stamp upon it, instead of our eagle, which foreigners may not understand, and which they may not distinguish from a buzzard, or some other bird, the intrinsic fineness and weight of the coin.  In this practical utilitarian age the officers of the Mint seemed to think it would be better to do that than to put the eagle on our silver coins.  I must confess I do not think it is very important;  but I think the Senator ought to be willing to defer in these matters to the practical knowledge of the officers who have charge of this branch of the Government service.  I will say that Mr. Linderman, whom the Senator must know, has suggested this as being a convenient mode of promoting international coinage.

This bill proposes a silver coinage exactly the same as the French, and what are called the associated nations of Europe, who have adopted the international standard of silver coinage;  that is, the dollar provided for by this bill is the precise equivalent of the five-franc piece.  It contains the same number of grams of silver;  and we have adopted the international gram instead of the grain for the standard of our silver coinage.  The "trade dollar" has been adopted mainly for the benefit of the people of California, and others engaged in trade with China.  That is the only coin measured by the grain instead of by the gram.  The intrinsic value of each is to be stamped upon the coin.

Did not every word of that indicate the continuance of silver coinage with full legal-tender quality as it had always had ?

International coinage in a trade-dollar, with a legal-tender quality of only $5, and even that poor quality was stricken out in 1875, so as to make it simply merchandise.  That was the coin the Senator from Ohio said was to float, and they were providing it should float all over the world wherever our flag floated, and that it should be international coinage equivalent to the coins of other nations.  Little wonder the Senator from Nevada said to him, "Whatever may be your construction of the meaning now, the words used then induced me to vote with you, because you made me believe that you were sending out a bona fide silver dollar as good as any in the world."  The Senate so believed.  The debate showed that Mr. Casserly announced that Nevada alone was then producing $20,000,000 of silver, and the question was, as to whether silver owners should pay the coinage charge of half a quarter, or one-eighth per cent.;  nothing was suggested anywhere that the silver dollar was to be stricken down.  The Senator from Ohio was as silent as the grave on that subject.

But that was not all.  To show that whenever things are not done as they ought to be, the track can be followed, and it will be in the same direction, the Revised Statutes were adopted shortly afterwards.  When it is said that we had coined no silver dollars, practically, up to that time, that is not the fact.  We had coined in the month of January, 1873, and in the first twelve days of February, 1873, nearly two million standard silver dollars of 412½ grains, nearly one-fourth of all we ever had coined.  By the way, if Senators will turn to Dr. Linderman's work on "Money and Legal-Tender," which you will find in the Library, you will see we never had coined a gold dollar from the foundation of the Government until long after the discovery of gold in California, and that we had up to 1848 about as much silver as we had gold coin of all sorts.  At the time we fought the war of 1812 and the war with Mexico, and acquired Louisiana, we were upon a silver basis, if that is worth suggesting.  All our acquisitions were obtained with silver coin, the Mexican dollar being the legal tender, as well as other foreign coins, most of the time.  The table furnished by Dr. Linderman shows it all, and the fact is proved by his tables that we had coined nearly two million standard dollars in less than six weeks before this act of 1873 was passed.

I think I can guess the reason why the bankers of Europe were pushing the act of 1873.  The Rothschilds, who held our bonds, and the great bankers of the Rhine, at Frankfort and elsewhere, were of course, all anxious for it to pass.  Mr. Hooper and the other bankers knew why.  How much the Senator from Ohio was allowed to know I can not state;  but Dr. Linderman showed in November, 1872, that silver was falling, and falling rapidly;  it had fallen from 3 per cent. premium down to par with gold when the act was passed demonetizing it, and that it was sure to fall still more rapidly.  All their bonds were payable in it while it was being stricken down in their countries.  Dr. Linderman tells the whole story in a report made the fall of 1872, after the bill had passed the House.  He takes credit for the trade-dollar as having been first suggested in his report.  He says we discovered very soon after the bill passed the House --as early as September or October, 1872-- that Germany was going to sell her silver.  The House had passed the bill, recollect, in May, 1872;  it came to the Senate practically in December.

Dr. Linderman in his book states what he said in the fall of 1872:

The amount of silver bullion annually produced from the mines of the United States has been increased during the last three years, and now amounts to about $20,000,000 per annum, exclusive of gold it contains;  and a further increase in this product being quite certain, the future value of silver as compared with gold is a matter of national importance.

The fluctuations in the relative value of gold and silver during the last hundred years have not been very great, but several causes are now at work, all tending to an excess of supply over demand for silver, and its consequent depreciation.  Among these causes may be stated the increasing production, its demonetization by the German Empire, and continued disuse in this country, except to a limited extent, as part of the circulating medium.

It has also been demonetized by Japan, while in some other countries silver coin has been wholly or partially expelled from circulation by paper money, the effect of which will be to bring to market as bullion large amounts hitherto used as coin.  The amount of silver coin in the German Empire at the date of the enactment of the recent coinage law, (December, 1871,) which changed the standard from silver to gold, is estimated by competent authority at $350,000,000, being equal to five years' total production of the globe.

Even if silver should be adopted by Germany for subsidiary coinage, not more than $50,000,000 will be required for that purpose, which will leave $300,000,000, or about nine thousand tons, to be disposed of as bullion.  A market for this immense supply of silver can only be found in such of the European states as maintain the single standard of silver or the double standard of gold and silver, and in China and the Indies.

The facts above stated indicate the gradual but eventually certain adoption of the gold standard, and consequent demonetization of silver by all commercial countries.  Not only is the tendency to adopt gold as the sole standard and measure value, but to use paper money redeemable in gold as the bulk of the circulating medium.

Then he proceeds to show that gold would necessarily appreciate, which he said meant the same thing as depreciation of property by reason of silver being stricken down.  I may refer to his table giving the amount of silver and gold we had then coined and the relation they bore to each other in 1873, showing that the pretense that silver was demonetized because it was either not a coin that the people wanted or because it was more valuable than gold is not true.  It was stricken down because the great gold brokers, foreign and domestic, saw that gold was becoming more and more valuable every day, and silver would necessarily fall because of the action of Germany.  The production of gold had fallen off in this country from $66,000,000 in 1856 to $32,000,000 in 1873.  Silver production had gone up from less than $14,000,000 four years before to thirty-odd million dollars in 1873.  That was the real cause of its being stricken down in the interest of the bondholders and the bankers and the usurers of Europe and America.

But I started to speak of the fraud --and I use the word deliberately-- the fraud committed by somebody in the Revised Statutes in demonetizing the silver coin then in existence.  Recollect the act of 1873 did not do that.  It left whatever coin had been coined as a legal tender for all debts.  It only provided for coins in the future.  The fraud in the revised Statutes had to be perpetrated to consummate the act and to destroy the existing silver money.  The Revised Statutes professed to be simply a compilation of existing laws, nothing more.  They so state officially on their face.  General Butler presented them.  This is what he said, among other things:

I desire to premise here that your committee felt it their bounden duty not to allow, so far as they could ascertain, any change of the law.  This embodies the law as it is.  The temptation, of course, was very great, where a law seemed to be imperfect, to perfect it by the alteration of words or phrases, or to make some change;  but that temptation has, so far as I know and believe, been resisted.  We have not attempted to change the law in a single word or letter so as to make a different reading or different sense.  All that has been done is to strike out the obsolete parts and to condense and consolidate and bring together statutes in pari materia, so that you have here, except in so far as it is human to err, the laws of the United States under which we now live.  And it will be necessary, if the bill passes Congress, that it shall pass without any one undertaking to amend the law as it stands in this revision, because once beginning to amend the revision by altering the law from what it is, will lead into an interminable sea, in which we shall never find soundings and which will never find a shore.  But if there be any omission of any provision of law, the theory of revision is that, that it shall be applied;  and to that the committee desire to call the attention of the House.

Judge Poland followed, who had charge of the bill, perhaps was chairman, and said:

As my friend from Massachusetts said, the committee have endeavored to have this revision a perfect reflex of the existing national statutes.  We felt aware that if anything was introduced by way of change into those statutes, it would be impossible that the thing should ever be carried through the House.  In the multitude of matters that come before Congress for consideration, if we undertake to perfect and amend the whole body of the national statutes, there is an end of any expectation that the thing would be carried through either House of Congress, and therefore the committee have endeavored to eliminate from this everything that savors of change, in the slightest degree, of the existing statutes.

So the Revised Statutes were passed;  and yet, coupling that with what was done in 1873 in regard to the silver dollar, is it strange that we find in those Revised Statutes all the silver coinage of the country that was a full legal tender for every dollar of debt, public and private, demonetized and not allowed to be a legal tender for more than $5 under and by virtue of the Revised Statutes ?  Whoever did it committed a fraud, a palpable fraud upon the country.  As I said and repeat, it required such a provision in the Revised Statutes to destroy the existing silver coinage of the country.  Whoever inserted it did it in the interest of the bondholders, willfully and fraudulently.  Passing from that, the Senator from Ohio, as the Senator from Kansas said in the speech from which I read, declared that the striking down of silver coinage and the substituting of the gold unit was an American idea.  I deny it, as the Senator from Kansas did, as every Senator who spoke upon this subject.  I ask Senators to read the report of Mr. Hunter, from which I would like to quote, made in 1853.  He there shows that silver and gold, acting side by side and treated both alike, was the American idea.  Gold, and gold alone, was the idea of the Senator from Ohio, but not of any other Senator or any other leading American that I know of.

Why do I say it was his idea ?  Because he went to Paris in 1867.  I do not know whether he wrote the letter while in Paris or not, but at an international convention to which Mr. Ruggles was the American delegate, appointed by Mr. Seward, in 1867, in making his report in regard to the question what should be the unit of value --a question never brought up before for action in the United States, so far a I know, but suggested in a convention of European nations-- Mr. Ruggles reports to Mr Seward as follows:

It was then stated to the Emperor that an eminent American statesman, Mr. Sherman, Senator from Ohio, chairman of the Finance Committee of the Senate of the United States, and recently in Paris, had written an important and interesting letter, expressing his opinion that the gold dollar of the United States ought to be, and readily might be, reduced by Congress in weight and value to correspond with the gold 5-franc piece of France;  that the letter is now before the international committee having the question of uniform coin under special examination, to which letter, as being one of the best interpretations of the views of the American people, the attention of the public authorities of France was respectfully invited.

Mr. Sherman's letter had not then been brought to the attention of the American people, so far as I know.  I think he represented only himself.

The Emperor then closed the audience by repeating the assurances of his gratification that the important international measure in question was likely to receive active support from the United States.

The letter of Mr. Sherman above referred to, dated the 18th of May, 1867, originally written in English, was presented in a French translation a few days afterwards to the international committee in full session, where it was received with unusual interest and ordered by the committee to be printed in both languages.  A copy is herewith transmitted for the information of the Department of State.

Further on, when they reached an agreement on the single gold unit, Mr. Ruggles took uncommon pleasure, he said, in giving great credit to his friend, the Senator from Ohio, as being the man chiefly instrumental in bringing about that result by the letter he had written and by the influence he had exerted.  Mr. Ruggles says:

The establishment of the single standard exclusively of gold is, in truth, the cardinal, if not the all-important feature of the plan proposed by the conference, relieving the whole subject, by a single stroke of the pen, from the perplexity, and, indeed, the impossibility of permanently unifying the multiplicity of silver coins scattered through the various nations of Europe.  It is a matter of world-wide congratulation that on this vital point the delegates from the nineteen nations represented in the conference were unanimous, not excepting France itself, so strongly wedded by its national traditions to a double standard.

Then he goes on to state the controversy they had among themselves and how they finally got together, Great Britain and Sweden standing out alone in favor of their own moneys.  He adds:

On all these questions the interests of monetary unification were materially advanced by the publication at Paris of the concise but admirable letter from the Hon. John Sherman, Senator in Congress from the State of Ohio, a copy of which has been already communicated to the Department of State, but which for more convenient reference is now transmitted herewith in duplicate with its French translation.  His opinions are unmistakably expressed in the following extracts:  "As the gold franc piece is now in use by over sixty millions of people of several different nationalities and is of convenient form and size, it may well be adopted by other nations and the common standard of value, leaving to each nation to regulate the divisions of this unit in silver coin or tokens.  If this is done, France will surely abandon the impossible effort of making two standards of value."

He was for the one standard and thought France could be brought into it.

Gold coins will answer all the purposes of European commerce.  In England many persons of influence and different chambers of commerce are earnestly in favor of the proposed change in their coinage.  The change is so slight with them that an enlightened self-interest will soon induce them to make it, especially if we make the greater change in our coinage.  We can easily adjust the reduction with the public creditors in the payment or conversion of their securities, while private creditors might be authorized to recover upon the old standard.

When Mr. Ruggles's report was made Mr. Sherman took it up and sought to carry its recommendations through Congress, and no doubt this is one of the things that he thought attracted so much public attention.  During the Fortieth Congress, June 9, 1868, Mr. Sherman made a report to the Senate in which he recommended a single standard exclusively of gold, and in that report used the language which the Senator from Kansas [Mr. Ingalls] quoted in the speech which he made:

The single standard of gold is an American idea, yielded reluctantly by France and other countries, where silver is the chief standard of value.

At the close of his report be said:

These reasons induce your committee to earnestly urge the adoption by the United States of the general plan of the French conference.

He attempted to show that the sole legal standard of gold was the one object most to be desired, while he insisted most urgently in regard to public debts that it was dishonest and dishonorable to require the holders to take pay in a coin less valuable than the coin of the contract.  He said if we reduce the metal in our coin, as our public debt is very large, we shall have to pay our creditors $90,000,000 in addition to the face of the bonds.  That was a small matter, however, though he afterwards urged, as Secretary and Senator, earnestly and repeatedly, that the silver coin of the contract should be increased and paid to the bondholders.  In his report he urged the gold unit, changing ours to the French standard, and providing for payment in addition to the bondholder.  I will quote his language exactly:

As to public debts, the contract of loan is the only law that ought to affect the creditor until his debt is fully discharged.

Now, pay attention to this.  I expect to read this again, because the act of July 14, 1870, made all public debts payable in the gold and silver coin of the standard value of that day, and every effort of Mr. Sherman or anybody else to increase the weight of the silver dollar, by any additional number of grains, simply seeks to impose a tax upon the people to the extent of the increase, in violation of the contract that he regarded as so sacred, when he sought to reduce gold.  Perhaps poor debtors have not the same contract rights as rich creditors, especially when bondholders are the beneficiaries.

Mr. Teller.  What is the date of that ?

Mr. Beck.  June 9, 1868;  it is Mr. Sherman's report from the Finance Committee, on the relation of the coinage of gold and silver:

Does not a different principle prevail as to public debts ?  As to public debts, the contract of loan is the only law that ought to affect the creditor until his debt is fully discharged.

Note that.  It ought to apply to the debtor as well;  he has rights in all contracts as well as the creditor, in my opinion at least.

Congress ---says Mr. Sherman--- as the authorized agent of the American people, is one party to the contract, and it may no more vary the contract by subsequent acts than any other debtor may vary his contract.  As to the public creditor, no legislative power stands between him and the exact performance of his contract.  Public faith holds the scales between him and the United States, and the penalties for a breach of this faith are far more severe and disastrous to the nation than courts, constables, and sheriffs can be to the private debtor.  These penalties are national dishonor and inability to borrow money in case of war or public distress, and the ultimate result is the sure and speedy decline of national power and prestige.  When changes in our coin were made in 1834 and 1853, the United States had no public debt of any significance, and the precedents then made do not app1y to the present time.  Now the public debt is so large that a change of 3⅓ per cent. in the value of our coin is a reduction of the public debt of$90,000,000.  So much of this debt as exists in the form of legal-tender notes will be received and disbursed as money, and as its value for some time will be less than the new coin, no provision need be made for it;  but for so much of the debt as is payable, principal or interest, in coin of a specific weight and value, provision ought to be made for its exact discharge in that coin or its equivalent in the new.  Your committee, therefore, propose an amendment to that effect.

That quotation may be useful in the further discussion of some other points made from time to time by that distinguished gentleman.  His proposition met with no favor as far as the history of American legislation publicly shows.  Even Mr. Morgan, of New York, who was supposed to be the representative of Wall street, in every form opposed it, and made a minority report in which he said:

A change in our national coinage so grave as that proposed by the bill should be made only after the most mature deliberation.  The circulating medium is a matter that directly concerns the affairs of everyday life, affecting not only the varied, intricate, and multiform interests of the people at home, to the minutest detail, but the relations of the nation with all other countries as well.  The United States has a peculiar interest in such a question.  It is a principal producer of the precious metals, and its geographical position, most favorable in view of impending commercial changes, renders it wise that we should be in no haste to fetter ourselves by any new international regulation based on an order of things belonging essentially to the past.

Again he says:

The movement proposed in the bill appears to be in the wrong direction.  The standard value of gold coin should be increased, brought up to our own, rather than lowered.

He gives many reasons for that.  Again he says:

The American continent, too, produces four-fifths of the silver of commerce.  The mines of Nevada have already taken high rank, and Mexico alone supplies more than half the world's grand total.  Our relations with the silver-producing people, geographically most favorable, are otherwise intimate.

Manifestly our business intercourse with them can be largely increased, a fact especially true of Mexico, which, for well-known political reasons, seeks the friendliest understanding.  This must not be overlooked.  These two streams of the precious metals, poured into the current of commerce in full volume, will produce perturbations marked and important.

Other countries will be affected, but the United States will feel the effect first and more directly than any other.  The Pacific Railway will open to us the trade of China, Japan, India, and other Oriental countries, of whose prepossessions we must not lose sight.  For years silver, for reasons not fully understood, has been the object of unusual demand among these Asiatic nations, and now forms the almost universal medium of circulation, absorbing rapidly the silver of coinage.  The erroneous proportion fixed between silver and gold by France, and which we are asked to copy, is denuding that country of the former metal.  Our own monetary system, though less faulty, is not suitably adjusted in this respect.  The silver dollar, for instance, a favorite coin of the native Indian and distant Asiatic, has well nigh disappeared from domestic circulation, to reappear among the Eastern peoples with whom we more than ever seek close intimacy.

As they prefer this piece we do well to increase rather than discontinue its coinage, for we must not deprive ourselves of the advantages which its agency will afford, and it would be useless to send dollars to Asia inferior in weight and value to its well-known Spanish and American prototype.

So, when Mr. Sherman and Mr. Ruggles managed to agree in regard to the single gold unit, and when Mr. Sherman presented it before the American Congress, it was met by a minority report from Mr. Morgan and then dropped, it became just and proper for the Senator from Kansas [Mr. Ingalls] to remark as he did in the speech I have just read:

In a report made to the Senate June 9, 1868, to accompany a "bill in relation to the coinage of gold and silver," Mr. Sherman, now Secretary of the Treasury, said:

"The single standard of gold is an American idea, yielded reluctantly by France and other countries where silver is the chief standard of value."

No statement emanating from authority so respectable could well be more devoid of truth.  The original American idea was a single standard of silver.  Gold was an innovation, and, in my judgment, a grave mistake.  The assertion of Senator Sherman that the single gold standard was an "American idea" is so singularly incorrect that it seems almost like a premeditated preliminary to the fatal error of 1873.

It seems as though the only pressure for that action, so far as I know, from any of the public men of the country was from the Senator from Ohio himself.  He confounds the American idea with his own and assumes that they mean the same thing.  Mr. President, the truth is, and there is no use denying it, that from the beginning of the war till now the moneyed men of this country and Europe and their advocates in and out of Congress and their supporters everywhere have sought persistently to make money out of the distress of this country.  They have attempted, and generally succeeded, at all hazards, by means foul and fair, lawful and unlawful, to make themselves rich at the expense of the great mass of this people.  The demonetization of our silver coin was but one step in that line, a step that was in perfect accord with all the other steps that had been taken and were afterwards taken, and the fraudulent act perpetrated in the Revised Statutes, whatever may be said of the motives of men, of the openness or secrecy of the act of 1873, consummating and making possible the benefits they expected to derive from the act of 1873, was another and the decisive step in the same direction.  No man will ever avow that he knew who perpetrated the fraud in the Revised Statutes.

When legal-tender notes were first circulated, war was made on them by all the bankers and money-changers from the beginning.  That war was kept up, and kept up persistently, and by none more persistently than by the Senator from Ohio to the very end, and, indeed, to this day.  When the greenback was first issued the combinations of bankers got together and determined that the greenback should be repudiated as far as they were concerned.  They all agreed that it should be good enough for everybody but them;  good enough for the soldiers, the sailors, the contractors, for everybody except the men who held the money-bags of the United States.  That repudiation was consummated in the Senate of the United States --no doubt in the Finance Committee of the Senate of the United States, of which the Senator from Ohio was then a distinguished member.  The gold interest on bonds paid for in greenbacks at par brought the first evils upon the country and placed and kept all the interests of the people under the money kings.  For fear I may be charged with making statements that I can not substantiate, I will read from a speech by Hon. William D. Kelley, quoting Mr. Stevens, who I suppose is at least respectable authority.  Mr. Kelley in his speech at Philadelphia said, speaking of the money that was issued when the Senate inserted the coin payment of interest on the bonds.

Mr. Kelley said:

The House refused to concur, and appointed a committee of conference, with Mr. Stevens as its chairman.  They contested the matter until further contest was in vain.  I remember the grand "Old Commoner" ---said Mr. Kelley--- with his hat in his hand and his cane under his arm, talking to myself and another, when he returned to the House after the final conference, and shedding bitter tears over the result.  "Yes," said he, "we have had to yield;  the Senate was stubborn.  We did not yield until we found that the country must be lost or the banks be gratified, and we have sought to save the country in spite of the cupidity of its wealthier citizens."  The bill went through, but not until he had expressed to the House and the country his fears.

That crime perpetrated by the Senate of the United States, or that blunder worse than a crime, has cost the American people more than all the war would have cost had the House bill been adopted as originally passed.  That crime or blunder called into existence the gold room of New York;  it invited from all the money centers of the world their most voracious vampires to come and fatten upon the life-blood of the American people.  It converted commerce into a mere system of gambling, and made such creatures as Jay Gould and Jim Fisk possible in American history.  Do I speak too severely ?  If I do, I will summon a voice from the grave to temper my severity.  I have here the Congressional Globe, in which I find the following remarks, made February 20, 1862, by Thaddeus Stevens, chairman of the committee of conference on the disagreeing votes of the two Houses on the Treasury-note bill.  In submitting the report he said:

"Mr. Speaker, I have a very few words to say.  I approach the subject with more depression of spirits than I ever before approached any question.  No personal motive or feeling influences me.  I hope not, at least.  I have a melancholy foreboding that we are about to consummate a cunningly devised scheme, which will carry great injury and great loss to all classes of the people throughout this Union, except one.  With my colleague, I believe that no act of legislation of this Government was ever hailed with as much delight throughout the whole length and breadth of this Union, by every class of people, without any exception, as the bill which we passed and sent to the Senate.  Congratulations from all classes --merchants, traders, manufacturers, mechanics and laborers-- poured in upon us from all quarters.  The Boards of Trade from Boston, New York, Philadelphia, Cincinnati, Louisville, St. Louis, Chicago and Milwaukee, approved its provisions, and urged its passage as it was.

"I have a dispatch from the Chamber of Commerce of Cincinnati, sent to the Secretary of the Treasury, and by him to me, urging the speedy passage of the bill as it passed the House.  It is true there was a doleful sound came up from the caverns of bullion brokers, and from the saloons of the associated banks.  Their cashiers and agents were soon on the ground, and persuaded the Senate, with but little deliberation, to mangle and destroy what it had cost the House months to digest, consider and pass.  They fell upon the bill in hot haste, and so disfigured and deformed it, that its very father would not know it.  [Laughter.]  Instead of being a beneficent and invigorating measure;  it is now positively mischievous.  It has all the bad qualities which its enemies charged on the original bill, and none of its benefits.  It now creates money, and by its very terms declares it a depreciated currency.  It makes two classes of money --- one for the banks and brokers, and another for the people.  It discriminates between the rights of different classes of creditors, allowing the rich capitalist to demand gold, and compelling the ordinary lender of money on individual security to receive notes which the Government had purposely discredited."

Again, in still more emphatic terms, and almost in repetition, only stronger, he repeats that it was the conspiracy between European bankers and the rich men of America, through the Finance Committee of the Senate, which brought about that condition of things.  They bankrupted the country and made themselves the richest men in the world.

What followed ?  I need not go over that history.  You all know it.  The usurers of the world bought the bonds of the United States with that very depreciated currency, averaging only about 50 cents to the dollar in gold, at the time.  Of course they paid the greenbacks for them at par.  One gold dollar bought two in paper;  the paper dollar bought bonds at par, with 6 per cent. gold interest.  Thus 12 per cent. was secured, and they called that patriotism !  They next had all the currency of State banks legislated out of existence by a tax, so that their currency and theirs alone, as national bankers, should circulate over the land.  The principal of their bonds was made expressly payable in greenbacks.  Even Mr. Sherman admitted that in 1868, in a celebrated letter which has been read time and again, in which he denounced them as extortioners for claiming that the bonds should be paid in coin.  Of course he was right, because each note had written on its back that "this note is a legal tender at its face value for all debts, public and private, except duties of imports and interest on the public debt."  Yet in the face of that, when Congress met in March, 1869, it declared, and Mr. Sherman led the column in the assault on greenbacks, that the greenback should not be received in payment of the principal of the bonds, although it was written upon it that it should be, and that the bonds should all be paid in coin.  The Senator from Nevada [Mr. Stewart] very properly said the other day that the advantages the bondholders had received from Congressional legislation had added to their value 50 per cent. before the act of 1873 was passed.

To make a long story short, the advocates of the money power followed up and sought new advantages promptly.  July 14, 1870, another act was pas ed, in which it was agreed that their bonds should be paid in gold and silver coin of the then standard value, which is the same as the standard silver dollar of to-day and the gold dollar of to-day.  They required that stipulation to be inserted in face of all the contracts, and the bonds were exempted from all taxation, State, Federal, and municipal.  No tax has since been paid by any holder of them to State, county, or city, or to the United States, no matter though the bondholder might be worth millions.  Perhaps the Senator from Ohio was guarding his friends in that act from his proposed change in the gold unit.  Ought they not to have stopped there ?  Had they not received benefactions enough to have satisfied any cormorant ?  They had degraded for their own benefit the currency issued by the Government to carry on the war and depreciated it for their own advantage, to the ruin of all others.  They had become the sole bankers of the country that could furnish currency.  They had declared that their own bonds should be paid in gold and silver coin in the face of an obligation written on the greenbacks with which they had bought the bonds;  and then they had their bonds exempted from all taxation, State, Federal, and municipal.

All this time the distinguished Senator from Ohio was chairman of the Committee on Finance, and every one of those acts met his cordial approval, so far as I know, even if he did write in 1868 the letter which I believe I will again reproduce for the edification of the people, in which he said they were extortionists if they demanded anything else than greenbacks.  He said to his friend:

Dear Sir: I was pleased to receive your letter.  My personal interests are the same as yours, but, like you, I do not intend to be influenced by them.  My construction of the law is the result of careful examination, and I feel quite sure an impartial court would confirm it, if the case could be tried before a court.  I send you my views as fully stated in a speech.  Your idea is that we propose to repudiate or violate a promise when we offer to redeem the "principal" in legal-tenders.

I think the bondholder violates his promise when he refuses to take the same kind of money he paid for the bonds.  If the case is to be tested by the law, I am right; if it is to be tested by Jay Cooke's advertisements, I am wrong.  I hate repudiation or anything like it, but we ought not to be deterred from doing what is right by fear of undeserved epithets.

If under the law as it stands the holders of the five-twenties can only be paid in gold, then we are repudiators if we propose to pay otherwise.  If the bondholder can legally demand only the kind of money he paid, then he is a repudiator and extortioner to demand money more valuable than he gave.

Truly yours, John Sherman.

But greed is never satisfied.  Not content with all these extortions, they had the law of 1873 passed striking down the silver coin.  Why ?  Because Germany had united with England in doing so after she had extorted a thousand millions from France as a war indemnity.  Silver was coming into use rapidly by the increasing product of our own mines.  Thus the people would be able to pay their debts and discharge the public obligations of the country with it more easily than they could with gold.  But, if the money kings could strike down silver, which was one-half of the world's money, in conjunction with England and Germany, they knew this would make them the richest men in the world and impoverish everybody else.  After securing the act of 1873 they changed the Revised Statutes, in the face of the solemn pledges given that there was no change in them, so as to destroy the legal-tender quality of what there was of silver coin at the time, and about $2,000,000 of standard dollars had been coined in the six weeks preceding the passage of the act of 1873.  Not content with that, it was not a year until we had a scramble in the other House, when the Senator from Massachusetts [Mr. Dawes] was chairman of the committee, and Black Friday came, as we remember, in New York.  The greenbacks cut quite an important figure at that time.  The Committee om Finance of the Senate reported against legalizing an increase of some $5,000,000 or $10,000,000.  But Black Friday, as I said, came in the mean time and an increase was made by executive order.  I may not give the exact figures, but the increase was from $354,000,000 to $382,000,000 --some $28,000,000 added to the greenback circulation by executive action.  Several bills were introduced in the House of Representatives and the question was elaborately discussed as to how much should be allowed as the maximum of that currency.  Mr. Dawes moved, as the Record will show, that the amount should be limited to $356,000,000.  Mr. Ellis H. Roberts, another member of the Committee on Finance, moved to make it $382,000,000.  I, then a member of the Committee on Finance, moved to make it $400,000,000, and after a long debate in the House it was made $400,000,000.

The bill came to the Senate, and was put into the hands of the Senator from Ohio.  I think the committee reported $382,000,000.  It was made $400,000,000 by a majority of the Senate, and it passed the Senate at $400,000,000.  It was sent to the President, and because there were some other banking privileges in it he vetoed it;  but it had passed both Houses, and a few months afterwards an act was passed fixing the limit at $382,000,000, and the President approved it.

Recollect they had silver quietly stricken down during this period.  The Revised Statutes had been adjusted to that end fraudulently.  No man will deny that the change in the compilation of the statutes was fraudulent;  I repeat that with emphasis.  The act of 1873 was, as I think I have shown, secret and unknown to a large majority of the Representatives of the States and people;  the change in the Revised Statutes was a fraud, purposely committed to consummate the advantages the money power had gained by the other act.  There is not a man in either House who will dare appear before the American people and say that he knew at the time that the Revised Statutes were altered so as to take away the legal-tender quality from the existing silver dollar.  The Senator from Ohio will not admit that he knew anything about that.  That change was secretly made, so secret that even the Senator from Ohio did not know it, I assume.

Yet it was done;  and after it was done and the bankers and the money-changers were having everything their own way, the next great movement in their interest was to strike down the greenbacks, destroy their legal-tender quality;  indeed, destroy them altogether.  The Senator from Ohio labored in season and out of season to strike down everything but national-bank notes and gold.  Silver had been effectually destroyed, as they assumed by prohibiting any more coinage, and no legal tender beyond $5;  even the $5 legal-tender quality was taken away from the trade-dollar;  the national banks, through their currency, were sought to be made omnipotent over the land.

That was the next move of the Senator from Ohio as chairman of the Finance Committee.  Recollect every national-bank note is a legal tender to you, and to me, and to every contractor, and to every soldier, and to every sailor, and for every obligation of the Government except interest on the public debt and customs dues.  Their bank notes were redeemable in lawful money.  The greenback was assumed to be lawful money, whether it had a legal-tender quality or not.  The banks would not take their own notes in discharge of the obligations due to them by the Government;  but you and I and everybody else had to take them.  With gold, and gold alone, with the greenback destroyed, with silver out of the way, who could get a dollar to pay his debts with, unless he went to a national bank and paid whatever premium they saw fit to ask him ?  Nobody.  That was the next great move on the boards, and the Senator from Ohio was the leading player.

Under his management the banks were to be made masters;  that was the great struggle the Senator from Ohio was making all the time.  Take the act about which he and others have boasted so much, the resumption act.  I hope Senators will read it carefully.  You will find it in volume 18 of the Statutes at Large, page 296.  The second section allows gold to be coined free of charge.  That was another move.  They had paid one-eighth of 1 per cent., or perhaps one-fourth of 1 per cent., before that time.  This was in 1875 recollect, while silver was still demonetized.  They were to have thereafter all their bullion coined free.  England had, they said, done the same thing.  England, of course, to carry out her policy, had done just what Mr. Sherman and his friends were doing here, making gold, and gold alone, the standard, and the bondholder or the holder of consols who controlled the gold, and he alone, was master of the situation.  England had provided by statute that for every standard ounce of gold offered to the Bank of England the bank should pay in their own notes, which could be converted into gold in a minute, £3 17s. 9d.  They had thus fixed the value for gold so that it could not fluctuate.  This statute had ours coined free of charge, and in the same statute they provided that all limitations should be taken away from national-bank notes;  they should issue just as many as they pleased, a thousand millions if they wanted to.  Let me read:

That section 5177 of the Revised Statutes of the United States, limiting the aggregate amount of circulating notes of national banking associations, be, and is hereby, repealed;  and each existing banking association may increase its circulating notes in accordance with existing law without respect to said aggregate limit;  and new banking associations may be organized in accordance with existing law without respect to said aggregate limit;  and the provisions of law for the withdrawal and redistribution of national bank currency among the several States and Territories are hereby repealed.

That was another of their schemes.  When the original banking act was passed, the provision was to divide the currency allowed, about $350,000,000, among the States according to wealth and population.  Kentucky had about the same population as Massachusetts, paying more taxes, not perhaps quite as rich in previously accumulated wealth, according to the census, but needing money quite as much.  Yet Massachusetts was allowed about $60,000,000 of national currency and Kentucky was allowed $7,000,000.

That same year I raised the question of a legal redistribution in the Ways and Means Committee.  The Senator from Massachusetts [Mr. Dawes] agreed that I was right.  We forced a redistribution.  Fifty-five million dollars was to be taken from those banks in the East which had received it in violation of law, and which Mr. Knox had favored because of their loyalty --for that seemed to be one of the things that was necessary for national banking under him-- and Congress ordered a redistribution.  Then came the panac&ealig;.  They did not want to give up the money.  They had all the bonds, they had all the circulation, they said, "Oh, no;  make banking free, make the circulation without limit," and they did so in order to keep the $55,000,000 that the law the year before had ordered them to give up.  When they got that done, they said that the legal-tender notes should be reduced down to $300,000,000 before resumption day, which was January 1, 1879, and after that day they were all to be destroyed.  The resumption act provides:

And to enable the Secretary of the Treasury to prepare and provide for the redemption in this act authorized or required, he is authorized to use any surplus revenues, from time to time, in the Treasury not otherwise appropriated, and to issue, sell, and dispose of, at not less than par, in coin, either of the descriptions of bonds of the United States described in the act of Congress approved July 14, 1870, entitled "An act to authorize the refunding of the national debt," with like qualities, privileges, and exemptions, to the extent necessary to carry this act into full effect, and to use the proceeds thereof for the purposes aforesaid.

Every greenback was to be destroyed after January, 1879, and all but $300,000,000 before that date, by the act which the Senator from Ohio had passed.  He would not say so distinctly at the time, that the greenback was to be absolutely destroyed.  He did not like to speak out.  That was one of the things that he was very particular about, but that he did intend to destroy all the greenbacks absolutely I suppose he will hardly deny himself, although I believe he said he changed his mind afterwards.  Mr. Bayard, then a Senator from Delaware, was making a speech in the Senate of the United States on the 27th of January, 1880, when the question came up whether this resumption act necessarily destroyed the greenbacks and authorized the sale of bonds at any rate of interest that the Secretary of the Treasury might see fit, in order to get the money to do it with.  Mr. Bayard said:

During the debate which attended the passage of the resumption act, the present Secretary of the Treasury, Mr. Sherman, who had charge of the bill in this body, was asked by several Senators, myself among the number, whether by the redemption of the United States notes under that act they were finally to be retired and destroyed, and he declined to give any construction whatever to the law on that point.

Mr. Edmunds.  May I ask the Senator if in his mind there is any doubt at all as to what the construction of that act was ?

Mr. Bayard.  I was unable to say what its construction was.

Mr. Bayard became quite complimentary to the Senator from Ohio, as he will observe:

I was unable to say what its construction was.  I thought it was a double-faced juggle intended to catch the votes of contractionists in one direction and of inflationists in the other.  I said so at the time, and I withheld my vote, for I thought it was not treating a great subject with proper respect to legislate upon it in such a way.  I therefore came to no construction.  I was disposed to believe that with a Secretary favoring one view, it would be made a means of contraction;  under the other view, which it seems has been adopted by many, it would become a means solely of inflation, because there was no limit put upon the notes to be issued by the Government to the national banks, and there was no security that the Treasury notes retired nominally in the course of redemption would not be reissued again by the Treasury;  and when the author of the bill --no, I will not say the author of the bill, for I have understood he was not the author of the bill, but he was the gentleman in charge of the bill-- declined to say what was intended by it, and what its effect would be, I believed then that there was some snare, and that it was an improper way of dealing with the subject, and hence the measure was not fit really to be before the legislative body.

Mr. Edmunds.  My apology for interrupting my honorable friend, to all of whose very interesting and satisfactory speech I am sorry I have not been able to listen on account of an engagement elsewhere, is that I thought it right it should appear in that connection that I voted for the act of 1875, because, on a careful examination, it was to my mind perfectly clear, no matter what the present Secretary of the Treasury chose to think about it or chose not to say about it, but on the bill itself that I was voting for, it was perfectly clear that the redemption that that act provided for, both before the 1st of January, 1879, and afterward, was a redemption which took out in point of law from existence all the United States notes that should come in, in the methods provided by that act.  And I am inclined to think that if my honorable friend would now examine the statute he would not have any doubt upon it at all.

Therefore I am justified in assuming that to be the object and intent of the resumption act.  They had destroyed silver, and they now passed an act to destroy the legal tender.  Everything was working as they desired, when the representatives of the States and people began to realize what was going on, and they stepped in and prevented these things from being done, first by restoring silver us a legal tender, and by the act of 1878, forbidding the reduction of the greenbacks below $346,000,000.  Then the struggle began to take away their legal-tender quality; that was the next best thing for the bankers.  Recollect, and I want Senators to examine for themselves, when the act rechartering the banks was passed, all their notes were made redeemable in lawful money, not in legal-tender money.  The word "legal tender" was never inserted once;  it was kept out on purpose, so that the legal-tender quality should be stricken down from these very notes and yet be of sufficient quality to redeem the national-bank circulation.

In view of what I read in regard to our solemn obligation to our public creditors, in the report made by the Senator from Ohio, as to the public debt being such a sacred public obligation that the coin in which it was payable could not be changed, I wish to call attention to what he was told by the law officers of the Government when he insisted that the bonds should be paid in gold and in gold alone.  He asked for an opinion from the then Attorney-General of the United States upon that subject, and he received it.  April 27, 1877, Mr. Sherman wrote the following letter, which I have read before, asking Mr. Devens whether or not the bonds he was about to issue could be made payable in gold and gold alone, which he thought for many reasons might be desired:

Treasury Department, Office of the Secretary,
Washington, D.C., April 21, 1877.

Sir:  I beg leave to call your attention to, and ask your opinion upon, the following questions growing out of the refunding act of July 14, 1870, to wit:

Can I stipulate in the body of the 4 per cent. bonds about to be issued that they shall be redeemable in coin of the present standard value;  that is, the standard value at the date of their issue, or must it be the date of the law ?

I submit a statement prepared by Hon. H.F. French, Assistant Secretary, having reference to the laws.

It may become important to the public interests to make the new bonds payable in coin of the present standard;  that is, gold coin.  Some doubts have been expressed upon whether previous bonds issued under acts passed prior to 1873 are not legally payable in silver coin.  This question may become important, as any doubt upon the legal terms of a public security affects its value.

Very respectfully,
John Sherman, Secretary.

Hon. Charles Devens, Attorney-General.

Mr. Devens told him officially on the 26th of April, 1877, in answer to his question, that he regarded it as his bounden duty to recognize the fact that all obligations were payable in the coin of July 14, 1870, silver as well as gold, which every lawyer has recognized since, although it may be Jay Cooke's pronunciamentos and declarations have been paraded here once or twice and all sorts of sophistry flung in to make a show of equitable doubt.  Mr. Edmunds, Mr. Matthews, Mr. Thurman, everybody, as well as Mr. Devens, has declared that the bonds of the United States can all be paid fairly, honorably, justly, in the lawful money that existed July 14, 1870, of the then standard value.  Mr. Devens's letter is as follows:

Department of Justice, Washington, April 26, 1877.

Sir:  In answer to your letter of the 21st instant, requesting my opinion upon the following question growing out of the refunding act of July 14,1870, to wit, "Can I stipulate in the body of the 4 per cent. bonds about to be issued that they shall be redeemable in coin of the present value, that is, the standard value at the date of their issue, or must it be the date of the law ?"  I have the honor to reply:

The act provides for the issue of bonds "redeemable in coin of the present standard value."  The word "present" undoubtedly refers as a matter of date to the time when the act was passed, and not to the time when the bonds were thereafter issued.  It contemplated that a long period would elapse before it would finally be carried into effect, and that changes in the coinage of the country might occur during that period.

Whatever changes in the coinage should occur, these bonds were, however, to be redeemed in coin of the standard value as it existed at the date of the act.  By this provision the holder was guarded against any depreciation that might take place in the value of the coin, and the Government would not be compelled to pay the additional value should the coinage be appreciated.  All the bonds issued under the act were to stand alike, no matter what was the date when such bonds were issued.  Each was to be redeemable in coin which was included in the authorized coinage of the country at the date referred to, it being of the standard value as it then existed.  Since the law was passed no change has taken place in the standard value of the coin.  It is understood that there has been a certain change in the coinage of the country, and that silver dollars have now ceased to exist practically as coin.

It has been further provided by the statute of February 12, 1873 (Revised Statutes, sections 3585, 3586), that "the silver coins of the United States shall be a legal tender at their nominal value for any amount not exceeding $5 in any one payment."

Notwithstanding this practical change in the coinage of the country and the passage of this act in regard to legal tenders, the form of bond to be issued by you should not be changed so far as the mode in which it is to be redeemed is concerned.  It was not intended that this should be varied according to the changes which might be made in the coinage, because a definite rule was given by reference to the coin of a particular date.  That which will pay the bonds heretofore issued under this act will pay the bonds which you may hereafter issue.

It can not be authoritatively said that the words "payable in coin" or "payable in gold" are equivalent to the words used by the statute.  Even if this leaves open for discussion the question whether bonds issued under this act are or are not redeemable in silver coin of the character and standard which existed July 14, 1870, it is not a doubt which it is in your power to remedy by the use of words in the bond other than those which this statute provides.

While I comprehend the difficulty suggested in your letter and the convenience that there might be in removing any question upon this matter, I am, therefore, of opinion that it would not be safe to issue the bonds, except as redeemable in coin of the standard value of July 14,1870.

Very respectfully, your obedient servant,
Chas. Devens, Attorney-General.

Hon. John Sherman,
Secretary of the Treasury.

Although Mr. Sherman had received that opinion from the Attorney-General, and although every bond that was issued had written upon its face that it was so payable, five months after that opinion was received by him, on the 3d day of December, 1877, that distinguished gentleman, as Secretary of the Treasury, with the opinion of the Attorney-General in his hand, wrote this to Congress:

If, therefore, the public interests demand the issue of silver dollars --a subject hereafter discussed---

This was in 1877, recollect, when he was resisting it with all his might---

it is respectfully submitted to Congress that an express exception be made requiring that gold coin alone shall be paid for principal or interest on bonds issued to public creditors since February 12, 1873, the amount of which is $592,990,700.  These bonds have entered into the markets of the world.  If the market value of the silver in the new coin is less than the gold dollar, a forced payment in the new coin is a repudiation of a part of this debt.

That was his opinion and recommendation;  that was what he desired to act upon in the face of an opinion from the Attorney-General, in the face of the written indorsement on the back of every bond that it was payable in coin of the standard value of July 14, 1870.  Yet as Secretary of the Treasury he denounced the laws of his country, as construed by the Attorney-General, when they militated against the views that he entertained in the interest of the bondholders, and called the law repudiation of a part of the public debt;  and he was so anxious to get clear of the silver dollar that in 1879, in his report as Secretary of the Treasury, he demanded that there should be no more than 50,000,000 silver dollars issued at the outside, saying that beyond that they could not be maintained.  This is what he said;  let me read it:

In the last annual report the Secretary stated ---he began very early--- "It would seem to be the best policy for the present to limit the aggregate issue of our silver dollars, based on the ratio of 16 to 1, to such sums as can clearly be maintained at par with gold, until the price of silver in the market shall assume a definite ratio to gold, when that ratio should be adopted and our coins made to conform to it:  and the Secretary respectfully recommends that he be authorized to discontinue the coinage of the silver dollar when the amount outstanding shall exceed $50,000,000."

That was in the report of 1878.  I read from the report of 1879.  After quoting the recommendation in his report of 1878, which I have just read, he says:

He again respectfully calls the attention of Congress to the importance of further limiting the coinage of the silver dollar.

He demanded payment in gold alone in the face, as I have said, of his own declaration demanding that we should pay $90,000,000 to the public creditors because by the change of coin he proposed in 1868 the creditor would get over 3 per cent. less value.  Now, in 1878 he wanted to pay the creditor in gold, and gold alone, on the bonds that he had issued, and denounced payment in silver as repudiation because it had depreciated 10, 15, or 20 per cent. by his own bad legislation.  He cared nothing for the tax-payers or their rights;  his sympathies were only aroused when the money was to go into certain rich people's pockets.  That is one reason why I said to the Senator from Ohio the other day that while he may be the President of these United States his conduct in regard to the act of 1873, with all his great financial ability, exercised as it has been always in the interest of the money power, will not be a record he will be proud of when he comes before the people for their votes.  I am done with that matter, and think I have made my promise good.

Now as to my coin-certificate bill.  The silver dollar !  Mr. President, war has been made upon the silver dollar ever since its recoinage was ordered in 1878.  I have more than once shown how absurd and how untrue all the predictions about the silver dollar driving gold out of the country have proved, and I need not repeat my former statements.

Every Secretary of the Treasury, all the bondholders everywhere, all the men who wanted to depreciate the price of property (and they have the world over since 1873 reduced the value of all the property of the people 35 per cent. by striking down half of the world's coinage that I will prove before I sit down, by reports made after careful investigation) predicted the dire effects of remonetizing silver.  Yet I can show that when gold was abundant, coming from Australia and California from 1850 to 1873, and silver was an equal partner, the property of the world increased in value 40 per cent., while from 1873, after we struck down silver and put all the money of the country and power over the property and products of the country into the hands of a few men, property has gone down 35 per cent. by this reverse action;  yet those men will tell you that we should stop silver coinage, because that is the way to force the European nations to agree to use it.  "Do not coin any more," they say, and you will ultimately put up the value of silver.  What keeps it at even the point where it is ?  Simply American coinage;  simply its scanty use by this great leading country in spite of the combinations of Europe, in spite of the efforts made here in 1873, and maintained even now.  The people rose in their might and overrode the veto dictated by the able Secretary of the Treasury at the time President Hayes vetoed the bill of 1878.  The then Secretary of the Treasury, now Senator from Ohio, was no doubt the inspiring cause of that veto of Mr. Hayes;  but the American people had found out what had been done.  Their representatives promptly passed the bill for recoinage overwhelmingly over the veto, and the bondholders commenced clamoring from that day on that we ought to stop it.

Those who urge this course say they are the friends of silver.  What does England want us to do ?  Stop coining silver, of course.  What does Germany want us to do ?  Of course they want us to stop coining silver.  We are the great silver-producers of the world;  the moment we stop our silver coinage down silver goes;  that is what England wants for India;  that is what they all want for their own colonies.  That is what they want us to do, and we are told that will make them, after we break down our silver coinage and all our silver industries, return to silver coinage.  Who ever heard of an army surrendering to the enemy on the battle-field at discretion as the best means of gaining a victory ?  What kind of a friend would you regard him who advised such a course ?  That is what they want;  all the advocates of gold, at home and abroad, advise us to do nothing more and nothing less than surrender at discretion.  Advice of that sort is simply humbug, or the baldest hypocrisy.

A few plain facts upset all their speculations and gloomy predictions.  Here they are:  When the act of 1873 was passed there were only $130,000,000 of gold in the United States.  When the act of February 28, 1878, was passed there were $213,000,000.  This is from the official statements of the Secretary of the Treasury.  On the 1st of July last, at the close of the last fiscal year, we had $654,520,000 of gold;  we had only coined $266,000,000 of silver, all told, since 1878.  The amount of gold that was added to our stock was $175,000,000 more of gold since 1878 than we have coined of silver since 1878.  And yet we were told by the honorable Senator from Ohio, when Secretary of the Treasury, and it has been dinned into our ears ever since by all the doctrinaires that Gresham's law would make gold take wings and fly to more favored climes;  that we would be on a silver basis every six months for the last eight years, and loss of credit at home and abroad would involve widespread ruin and national dishonor.  I stand on the facts to disprove all their speculations;  one fact is worth a thousand theories.  One hundred and seventy-five million more of gold dollars have come to this country since we began to coin silver than we have coined of silver dollars, and in the year just closed, the official report of the Director of the Mint shows that the surplus gold imported over gold exported was thirty-three and one-half millions.  The report further shows that the average annual product of gold in this country has been less than $33,000,000 for the last ten years, and that nearly $13,000,000 are used in the arts, in making watches, and the ten thousand things which it goes into leaving only $20,000,000 per annum, or $200,000,000 for the decade, for use as coin, so that we have drawn from foreign countries under this system of silver coinage over $200,000,000 of gold in excess of all produced in this country.  Does that look as though we are being ruined by silver or by Gresham's law ?  What else have we done ?  We have paid off every bond of the United States that can be paid.  Since Cleveland's administration began we have reduced the national debt over $250,000,000 --I think nearly $300,000,000, but certainly over $250,000,000.  We have paid off $194,000,000 of 3 per cent. bonds.  We have bought $27,000,000 or $28,000,000 of fours and four-and-a-halfs, besides other things, until now there is over $250,000,000 paid, and we have a surplus of over $300,000,000 on hand;  one of the last official reports shows the net gold in the Treasury to be:  gold, $202,000,000, supplemented by $44,500,000 in silver and $60,000,000 more of our money is deposited with the national banks to keep the money which the people have paid in needless taxes from being locked up in the Treasury.

Think of it !  Over two hundred and fifty millions of debt have been paid off, over three hundred millions of surplus are on hand, two hundred and odd millions of gold, forty-four millions in silver, and sixty millions loaned out, and yet a struggle is being made every day to make the country believe that we are on the verge of ruin !  We have only succeeded in keeping the bankers, and bondholders, and their representatives here, from ruining the country.  I have a paper in my hand showing that with all the pretense of England, of Germany, and of France, there is to-day more silver, by twenty-five millions of dollars, in the continental banks than they have gold.  Here is a table showing what was in the Bank of France on the 9th of February, 1888, the banks of Austria, the banks of Germany, and the silver exceeds the gold in their banks alone, saying nothing of what is in the hands of the people, over £5,000,000 or $25,000,000.  The table is as follows:

Mr. President, I repeat that the bill which I introduced, and which was voted for by five out of the eleven members of the Finance Committee, to issue coin certificates instead of gold and silver certificates, is the first great step for this Congress to take in order to place the two metals in proper relation.  Why should we have a silver certificate and a gold certificate except that the leading bankers of the country do not want to acknowledge that silver is equal to gold ?  Therefore, they want their own certificates in gold, and let others who are as subsidiary to them as they claim silver is to gold, take silver certificates, so that a hue and cry can be raised whenever they choose to suggest that silver is to be merely a token metal and shall not have equal rights with their gold.  This country will never assume the proper relation to its own money and its own coined metals until it does away with all discrimination between them.  The national banks are forced to admit that they are failures now in furnishing currency for the use of the people.  The country knows it.  The whole system was wrong in principle from the beginning, and was gotten up for the purpose of making money for a few rich men.  It worked well for a time in the way of safe and uniform circulation, but it never was run in the interest of the country.

The Senator from Alabama and the Senator from Texas will recollect --as they took active part in 1882 when we were rechartering those banks-- that we by law forbade them from entering into any combination to discountenance or boycott silver certificates;  we inserted a stringent provision in the law;  yet they defied us, they formed alliances in defiance of us, and our own creatures, our fiscal agents, the national banking organizations, would not take silver or silver certificates over their counters, so that silver could not get into their clearing houses in any form.  They overcertified checks to suit themselves, and laughed at us for thinking we could control them.  Now they have contracted their currency about one hundred and sixty million in the last four years in the face of growing wants of the country for more.  When we have built 11,000 miles of railroad in the year just closed, when we needed $160,000,000 more of circulation than we did four years ago, they contracted $160,000,000 of theirs.  Their excuse may be good, but what good does the excuse do the country.  They say they did it because we required them to surrender the bonds which were the basis of their circulation;  of course we did;  we had to do so or allow the money to be locked up in the Treasury.  Every 3 per cent. bond has been paid;  twenty-seven or twenty-eight million of the fours and four-and-a-halfs have been paid;  and they say they can not afford to pay the premium now asked for other bonds and take out new circulation.

I hold in my hand a table showing what they had in November, 1883, what they had in February, 1888, which shows that the bonds to secure circulation were reduced from $362,000,000 to $182,000,000, and there are $102,000,000 of greenbacks now locked up in the Treasury in order to guard these outstanding notes on which the bonds have been withdrawn.

The Secretary of the Treasury has been compelled to put in the hands of national banks over $60,000,000 for nothing, which is being loaned at interest to those from whom it was taken in order to keep the money from being locked up in the Treasury.  In view of these facts I ask Senators what would have been the condition of this country if we had been left to the tender mercies and the policy of the Senator from Ohio and of the national bankers.

If the advice of men like the Senator from Ohio [Mr. Sherman] and his allies had been followed, and no resources to furnish currency had existed outside of the national bankers when they reduced their circulation one hundred and sixty million in the last four years, paying no attention to the wants of the people, I ask whether we would not have been bankrupt to-day ?  The despised silver dollar and the certificates based thereon has saved the country from ruin.  When we treat silver and gold as equals before the law, as they should be treated, all will be well.  The restoration of the legal-tender quality to the silver dollar was all there ever was of resumption, everything else was false pretense.  Why should we be told now in the face of the movements of the world that we shall not put the two metals and the paper based on them on an equality ?  I have never believed that silver money has had fair play, but at the same time I have never believed that it ever had an enemy that has persistently done it as much harm as the distinguished Senator from Ohio.  He has worked to degrade it from the time Mr. Ruggles made his report to Mr. Seward, and from the time that he sought to establish gold as the sole unit in 1868;  from the time that he denounced all payments to bondholders except in gold as repudiation;  from the persistent efforts he made everywhere to destroy all legal tender but gold.

I do not say they were not honest efforts.  I have said often and I believe that he is, if not the ablest, one of the very ablest men whom I have ever seen in public life;  and it is because of his great ability, differing as I do with him, that I regard his financial policy as dangerous, yes, ruinous to the best interests of the people of this country.  I have made no charge against him of corruption or of anything wrong.  I differ from him in policy and I oppose measures, in defense of the best interests of the masses of the people as I understand them.  I have no doubt that his great abilities have a powerful influence over masses of men in high places in this country, as they had in Paris when the gold unit was first sought to be established, and his known power aids strongly in keeping up and in giving encouragement to the movement that is now going on in Europe by the royal commission and otherwise, to perpetuate the power of gold.

I have no doubt the present President of the United States, who had no means of knowing half as much about financial matters at home or abroad as the Senator from Ohio did, or as much as many people who have been in public life for a long while knew in regard to public matters, was alarmed when he came into the high position of Chief Magistrate of the Republic by the clamor that had been kept up through every administration and through every Secretary of the Treasury against silver, and that leading men of both parties in New York City endeavored to persuade him, and did convince him before he came here, that unless he did something promptly to stop the coinage of silver, ruin would speedily follow.  I have no doubt the President was alarmed;  and I know that when he came here first he thought the advice so ably advanced by the Senator from Ohio and other Secretaries of the Treasury during former administrations was good.  I made a speech at the first session under our Administration which gave positive offense to some distinguished gentlemen in New York and elsewhere.  They regarded it as impertinence for an outside Western Senator to assume to dictate to Wall street. They thought it wonderful that any one should assume to know anything that they did not want to know.  My speech was answered by many able men, and Mr. Horace White, of New York, was one of them.  He admitted substantially that efforts were made to create a panic.  This is what he said in a review he made of my speech.  The same ideas were presented by Mr. Hewitt in a speech in the House of Representatives.  I will read what Mr. Hewitt said first:

I have reason to know, when the present Administration came into power, its first and chiefest concern was to avoid the danger which had been predicted by the Republican Secretary in his official statement and in his private communications.  The amount of gold in the Treasury on the 4th of March, 1885, was $126,000,000.  This was a much smaller sum than had usually been held in the Treasury in gold since the redemption [sic resumption?] of specie payment.  It was steadily running down.  The public confidence was gone.  The hoarding of gold had begun --not by the mass of the people, not in stockings, not in secret hiding-places, but by the masters of finance, the men whose business it is to handle millions and to prevent deterioration;  they began to prepare for the hour of danger and the collapse which they thought was impending.

I know three of the greatest institutions in the city of New York --I shall not name them, lest it might possibly bring down upon them the condemnation of those who are prejudiced against banks-- but I know three institutions in the city of New York which had accumulated more than $25,000,000 of gold as a preparation for the collapse they thought was coming.

Mr. Horace White, in reviewing my speech, said:

A sort of panic ensued in the money market, and it came to my knowledge that Governor Tilden was one of a considerable number of persons who, without any concert of action, had bought large amounts of sterling exchange in order to protect themselves against loss in case silver should become our monetary standard.  Sterling exchange means gold in London.  Why was Governor Tilden buying sterling exchange ?  Because, happening to have on hand a certain number of dollars worth 100 cents each in gold, and apprehending that if left in bank they would presently be worth only 90 or 80, or perhaps 75 cents each, he took the precaution to insure that they should continue to be worth 100 cents.  He had only to write a few lines to his banker to insure this result.  This was a typical case of the domineering "organizations of wealth" that Mr. Beck has conjured up.

Little wonder the President, then comparatively a new man in national politics, was staggered.  These were the men, these were the organizations fortified in their assumption by all the predictions of the Senator from Ohio and other great leaders of both parties, that silver and silver alone, would become our currency if we did not stop coining it, at once they urged it when we had less than $100,000,000;  now, in the face of their failure, the result of the efforts they made and combined in making is still to prevent the people of this country from recognizing gold and silver both as part of the money of the country.  They have at last to admit that the national banks are a failure.  They are no longer of any value as the fiscal agents of the people.  Still they are here keeping up their hostility, and they meet, as usual, in convention denouncing silver, and demanding that it be demonetized, as loudly as if they were important factors in supplying currency to the country.  The national boards of trade that meet here in Washington unite with them in denouncing silver, and even now insist that it shall be demonetized, just as earnestly as if national-bank notes were being issued fully up to the wants of the people.  The banks have bills before Congress now, asking us to give them the right to increase the issue of their currency from 90 up to 100 or par on their bonds, as though they were going to be of any use to the country in furnishing the currency of the people any longer.

They are simply asking us to make their bonds more valuable so that we will have to pay them that much more premium when we buy them, as we now must do, in open market.  That is the only use their bonds now are to them, except for the present, till we reduce taxation, they can deposit them and get dollar for dollar of circulation already existing which belongs to the people and loan it to the tax-payers who furnished it at 6, 8, or 10 per cent. interest.  That condition of things, the President says in his message, is indefensible, and ought promptly to be remedied by Congress.  He was obliged to resort to it as the best he could do under the circumstances.  Turning for a moment to Mr. Atkinson's report, I have only to say that all the agents who go to Europe, go there, not to help us, as far as I am able to observe, but to give aid and comfort to the men who are seeking to break us down.  I have great respect for Mr. Edward Atkinson as a gentleman, a man of learning and of high integrity and ability.  Mr. Edward Atkinson has made a report which has been laid on our tables in which he does not even pretend to notice the fact that a great committee under Lord Iddesleigh have looked into the question of the demonetization of silver, and that they have reported evidence showing that the depression of the world's business, the depreciation of property, and the prostration of commerce grow out of what the witnesses call the great conspiracy of 1873 between England, Germany, and the United States.  Lord Iddesleigh was then a member of Parliament.  I have the report.

There is no indication --says Mr. Atkinson-- that the subject of bimetallism has received any intelligent or serious consideration outside of a small circle in each country named, as a probable or possible remedy for the existing causes of alleged depression in trade.

When he said that he had before him the report of a commission which took volumes of testimony.  It was perhaps the ablest committee that ever was raised in England.  Its report was exhaustive upon all branches of business.  That commission, which Mr. Atkinson does not deign to notice, made a report June 18, 1886, addressed to the Queen, saying, among other things:

In recent years the purchasing power of gold has increased, or, in other words, the prices of commodities in general, as measured by a gold standard, have fallen;  and this appreciation of gold, taken in combination with other circumstances, has disturbed the relations between the two precious metals.  An inconvenient depreciation of silver, as measured in gold, has for some time prevailed, and is still proceeding.

Without going into minute detail, we may point out that these changes result from a two-fold set of causes. Not only has the supply of gold diminished, but the demand for it has increased.  That is to say, the actual production of gold from the mines has declined, while the demand for it has been largely increased by its substitution for silver in the coinages of Germany and other countries;  at the same time the supply of silver has been increased both by the somewhat larger produce of the mines and by the demonetized silver thrown on the market by Germany and Holland.

It seems unnecessary at this moment to refer in detail to the other changes in the monetary system of the world, such as the altered policy of the Latin Union, the resumption of cash payments on a gold basis by nations which had suspended them and the increased absorbtion of gold in India.  Questions may also arise as to the possibility of other circumstances having occurred which have affected the value of precious metals, such as, for example, any addition to or diminution of the quantities used for other than monetary purposes.  All these subjects should have their proper weight given to them in the fuller and special inquiry which we recommend should be instituted.

Neither do we propose to enter upon the very important subject of the effect which the fluctuations in the value of the precious metals have upon the relations between the home and Indian governments in their large monetary transactions.  That India has to receive her revenue in silver and to make her payments for a large portion of the interest on her debt, for the articles which she purchases or for the services which she commands, in gold, and that a fall in the value of silver seriously disturbs her budget, is obvious and is not unnaturally disquieting.  But it does not appear to us to be directly within the limits of our inquiry, though indirectly it may have a bearing on the trade of India, and we may have occasion to recur to it.

We have not thought it desirable to take any oral evidence specially directed to this question;  but we append a series of questions which we circulated among a limited number of gentlemen, who, either from their practical experience or from their researches in the subject, appeared likely to be able to afford useful information or to express opinions of value.  Many of those to whom we applied have been unable from various causes to draw up answers to the questions.  We annex those which we have received, and we venture to think that they will afford valuable material for prosecuting further inquiry into the subject.

We are strongly of opinion that the question deserves early and separate examination from other points of view than that of our commission, and that apart from its general connection with the depression of trade it should be treated with reference to our currency as a whole, and to our monetary system at home and to its relations to our colonies, to India, and to foreign countries;  and we humbly submit to Your Majesty that from the general anxiety expressed on the subject the necessity for such an inquiry is urgent, and that it would both save time and facilitate investigation if a special inquiry into the group of questions which relate to the currency were set on foot and were intrusted to such persons as might seem to Your Majesty the most proper to conduct it under an order of reference carefully prepared and drawn so as to include all branches of the subject.  All which we humbly submit for your Majesty's gracious consideration.

Iddesleigh, Houldsworth, Dunraven, Jackson, Sclater Booth, Jamieson, John Aird, Lubbock, James Allport, Albert Muntz, Birtwistle, Palgrave, Lionel Cohen, Palmer, James Corry, Pearce, David Dale, Price, Drummond, Samuel Storey, Farrer Ecroyd, Henry Gibbs, Murray, secretary.
18th June, 1886.

Observe, they call for a special committee on silver coinage.  The royal commission was the result.  And in the appendix which I have before me --I do not want to take time to read it;  but I asked on one occasion that this testimony might be published and I borrowed from my friend, the Senator from Rhode Island [Mr. Aldrich], his copy, because I have cut off the testimony from my own copy which our minister to England was kind enough to send me-- I have marked in red pencil so as not to swell the Record too much, but to give a clear idea of what all these gentlemen said that answered the questions propounded by Lord Iddesleigh's commission.  Nine printed questions were put and were answered by twenty-seven leading men in England, presidents of banks, chambers of commerce, and with almost one accord they agreed that the restoration of silver to the coinage upon substantially the old basis was the only solution of the troubles now crushing the commerce of the world --there is no other-- and they agree that it does not require an increase of value of metal in the silver coinage.

The restoration of it to a legal tender is all that is wanted.  Some of them furnished valuable tables to show an average decline of 35 per cent. in values because of what they do not hesitate to call the great crime of the age when Germany and the United States in 1873 united with England to strike down legal-tender silver coins.  They also show that up to that time as long as gold was being furnished in large amounts from Australia and California, every business was prosperous and prosperity was the rule and not the exception, not only in England, France, and Germany, but in the United States, indeed all over the world, and that property values from 1850 to 1873 increased 40 per cent. in all civilized nations.  There is so much of this testimony that ought to be scrutinized by Senators, of course I will not take time to read it, but I will ask leave to print what I have marked in red marks, and I shall upon some proper occasion ask the Senate to order the whole of it to be printed as a proper accompaniment to the views and opinions of Mr. Atkinson.

Mr. Stewart.  Ask unanimous consent to print it.

Mr. Beck.  There is too much of it to be made part of a speech [exhibiting].  I will insert as much of it as I think will illustrate and prove what I say about it.

Appendix C.

Questions on the subject of currency and prices, circulated by the royal commission on the depression of trade and industry.

1.  Has there been, within a period which can be distinctly defined, a fall (i) in the gold prices, or (ii) in the silver prices, of commodities in countries where those metals are respectively the standards of value ?

2.  If so, has the fall extended uniformly to all commodities, or has it been confined to some particular class or classes of commodities ?

3.  Apart from any circumstances which have tended to lower the price of particular commodities, or of commodities generally, are there any circumstances which have enhanced the value of the metal used as the standard ?

4.  Have similar circumstances ever occurred before, and what results did they produce ?

5.  To what causes do you assign the fluctuations which have occurred in recent years in the ratio of the precious metals to one another ?

6.  Are there any indications that the development of the credit system, or other similar means of economizing the use of the precious metals, has tended to counteract or retard the fall of prices ?

7.  What circumstances, apart from an appreciation of the metal used as the standard have tended to bring about a fall of prices generally ?

8.  How is trade affected by alterations (i) in the value of the metal used as the standard and (ii) in the value of the precious metals inter se, especially in the case of trade between gold-using and silver-using countries ?

9.  What is the effect of the present relations of gold and silver upon the internal and external trade of India, and upon prices in that country ?

I.  Mr. Robert Barclay says:

My Lord:  I have much pleasure in replying to the questions you have submitted on behalf of the royal commission on the repression of trade.

3.  Yes.  The closing of the mints of France and the Latin Union destroyed the par of value between gold and silver, which the free mintage of these metals at the fixed-ratio of 15½ to 1 had maintained as long as these mints were open to silver as fully as gold, was practically international money;  but since then gold has been regarded by all the European nations and also by America as the only standard of value for international purposes, and the increased work thus thrown upon it as a store of value has led to its enhancement.

Improved credit appliances facilitate the transference of value, but when property of any kind is parted with for money it is something that may, if wished, be a permanent possession that is sought, and credit as an aid to money in this sense can not be expanded, except in due proportion to the metallic money on which it is supposed to give an absolute lien, just as a banker's obligation must be in due proportion to his reserve.

7.  Apart from monetary causes there have been many other things at work tending to cheapen production, say, new inventions, scientific discoveries, and new applications of chemistry, an increased use of labor-saving machines, and the higher speeding of machinery, rendered possible by the greater mathematical perfection and accuracy of its construction;  but all these causes combined would not, I think, account for, perhaps, more than, say, a sixth or a fifth of the actual difference which is seen.

8. The appreciation in the value of the monetary metal, gold, upon which our English values are based, has had and can not but have, a most serious effect upon trade.  It means declining prices for commodities, and when prices are continuously declining all enterprise is banished from trade.  The trader must work with the barest possible stock, as everything held over becomes dear as compared with the price at which it could be replaced.  The whole fabric of trade is built up on credit and time contracts, and stability of the money basis on which it rests is all-important.  Transactions entered into in the hope of profit may result in loss if prices, from an appreciation of the monetary measure, fall before the transactions can be completed.  An enterprise requiring the investment of capital may offer strong inducement for entering upon it;  but when the question is considered, How will the property to be acquired be affected by the decline of prices going on? the risk of loss in this respect counter balances the inducement.

The fact of India being upon a silver basis has, I think, so far been in many respects an advantage to her.  Her internal trade has not suffered from the decline in prices which has been so disastrous in Europe, and the divergence of the relative value of gold and silver has had no practical effect upon the welfare of the great body of her people.  The development of her external trade has also so far not been seriously impeded, rupee values of European articles laid down in India not having risen with the fall in silver, gold prices having conformed to the standard of India and not rupee prices to the gold standard of Europe.  The lower European value of the rupee has also helped to stimulate her exports.  On the other hand, the exchange difficulty makes it impossible for India to borrow in her own currency, and the disadvantage she suffers in this respect in very great not only as regards the carrying out of public works, but in many ways in which the outflow of British capital would both enrich India and benefit England.

III. Mr. Hammond Chubb said:

3.  The circumstances which led to the enhancement of the value of the metal (gold) used as a standard were those connected with the substitution of gold for silver by Germany and other countries.  To these must be added the increased use of gold in the United States, a diminution in its production, and the growing requirements due to increased population.

But if, as seems to be inferred by the question, it is admitted that a fall is due to the appreciation of gold --and I entirely concur in such an opinion-- it is difficult to estimate what proportion of the fall is due to that cause.  If it is admitted not only that gold has appreciated, but continues to appreciate, then prices not only have fallen, but continue to fall;  and but for this permanent cause of depression it is possible that the other causes put forward to account for a fall in prices would have only a limited operation and take rank amongst the ever varying incidents of a healthy competition.

But the effect upon trade is, no doubt, that of a tendency to its contraction;  and capital, which would have been used to stimulate trade, will, by preference, be invested in securities yielding a fixed interest in gold, though the payment of this interest be to the disadvantage of those, chiefly governments and other public bodies, who have contracted such arrangements.  The modes in which the results of falling prices due to an appreciating standard would be manifested would vary with the trades affected, but the operation of the principle would be continuous, and not the less hurtful that it is not generally apparent.

If it be the case that produce can be grown in India at the same cost in silver as that which has long prevailed and be sold in England for gold, which, at present, commands more rupees than formerly, this would be to the advantage of India, and lead to increased exports.  And, again, if the cost of labor in India has not increased, it might lead, in certain cases where practicable, to the amount realized by such exports being used for the establishment of factories in India, rather than to the purchase here of manufactured goods.  If the present relations of silver and gold were final, this condition would probably be modified in course of time as prices rose in India;  but if the present ratio between the two metals widens more rapidly than prices rise in India, an advantage would continue to accrue to India, as against gold-using countries.  This leaves out of view the loss by exchange incurred by the government of India through its indebtedness to England.

IV.  Mr. M.W. Collet says:

3.  This question I assume to mean whether the standard itself as a measure of value has altered, and, if so, what has caused the alteration ?  Whatever the answer, it does not admit of exact proof, but by inference it is to be assumed that the abstraction of gold in large quantities for coinage purposes by Germany, Italy, and other States and Treasury reserves in the United States, the increased application of it for ornamental and artistic purposes beyond former requirements, together with the simultaneous decrease in the annual production of this metal, must have rendered it relatively more valuable;  and this view is consistent with the fall in prices noted in the answer to the first question.

VI.  Mr. Alexander Del Mar says:

This fall of prices has been ascribed by some persons to "overproduction;"  but apart from the consideration that if overproduction, including the precious metals, were general, it could have no effect upon prices, and if not general it would rectify itself by the shifting of industries and avocations in a briefer space of time than thirteen years, it is to be remarked that previous to 1873, when the forces of production were as great and the actual production of commodities per capita of population was not less than it is now, there was no complaint or pretext of overproduction.

The true cause has been --here I speak as a practical miner and producer of gold, well acquainted with the conditions surrounding its production and use generally-- the true cause has been the dwindling product of the gold placers of California and Australia, and the utter inability of quartz mining as a whole to put gold on the markets of the world at the lower equivalent, in commodities and services, at which it was previously put by the placer mining.  This dwindling product of gold, suddenly and enormously aggravated by the demonetization of silver in Germany and the subsequent suspension of free coinage for silver in France, the United States, and other countries, has been, in my opinion, the true cause of the recent fall in the prices of commodities.

Your commission asks if similar circumstances ever occurred before.  Yes;  they occurred after a similar failure of the Roman mines, an event which precipitated the disruption of the Western Empire, and was followed by the tremendous consequences so ably depicted in Sir Archibald Alison's "Essays;"  they occurred after the dismemberment of Charlemagne's empire, an event which occasioned the secret hoarding of the vast quantities of gold and silver which that monarch had captured in Saxony and Hungary, and had made into money;  and they occurred again during the eighteenth century, when the plunder of America and the Orient was quite over, and the metallic product of Spanish America, although it continually increased under the cruel stimulus of the lash, yet it failed to increase fast enough to supply a rapidly-growing Europe with the materials for money.  In the latter instance the evil effects of diminishing moneys manifested themselves in every country of the European world, including America;  in each of them it was due to the failure of the supplies of the precious metals to keep pace with loss, wear and tear, and increasing demand to sustain prices;  in nearly all of them it was followed by similar consequences;  a continued and uneven fall of prices, industrial distress, social disorders, turbulence, anarchy, revolution, wars, and the dissolution of empires.

* * * * * *

From what I have seen of gold and silver mining during the past thirty years, I should say that in the long run it probably costs as much effort to find and bring to grass-roots a pound of silver as a pound of gold, and that in all newly-opened countries gold would even be cheaper than silver, because in such countries the former is always to be found on the surface, whilst the latter is hidden away in the uncertain convolutions of volcanic rocks.

* * * * * * * * *

Among those who admit the entire amenability of the ratio to legislation there are some who deem it necessary at the present time to procure an international concert of action on the subject.  With the highest respect for those who advocate this policy, it seems to me unnecessarily cautious and timid.  It did not require a concert of the nations to break down the ratio, and it needs no concert to restore it.  Either one of the four leading nations can do it, for each of these has enough gold to exchange for all the silver that will probably be offered to its mints.  But foremost among nations in its large control of the precious metals stands England, whose financial investments in foreign countries and whose widespread commerce have conferred upon her the hegemony of the commercial world.  She can certainly afford to permit one-fourth of her £100,000,000 of gold to flow out in exchange for £25,000,000 of silver, which is far more than the combined world will be likely to offer to her mints during several years.  This sum, coined upon the same terms as gold into full legal-tender money --first, and in order to discourage counterfeiting, at the so-called market ratio of 20, and afterwards recoined at the American ratio of 16 or the French and German ratio of 15½-- would not only yield England a handsome profit, but, what is far more important, it would arrest the present depression of trade and avert from impending disaster England's commercial interests in India.

VII.  Mr. Claremont Daniell says:

The statistics of imports and exports of gold treasure which the government of India compiles show that in a little more than fifty years India has imported, and not re-exported, gold to the value of £127,000,000 sterling.  To this must be added the gold treasure which India had continued to absorb during more than two thousand years, the amount of which may be inferred from historical records extending from very ancient times to the present century.  I consider that I estimate the gold treasure existing in India in 1835 (when our statistics of imports and exports of treasure began to be compiled) at a low figure in putting it at £100,000,000 more.  It is sufficient to notice the extent of this absorption of gold by India since 1835 for the purposes of the question (£127,000,000).  This drain of the precious metals to India arises from peculiarities of the commercial productions of that country and in the condition and habits of the people.  The country produces commodities which are to a great extent superfluous to the wants of the mass of its people, while at the same time these are readily sold to Western nations.  This circumstance enables the people of India to export these commodities without any enhancement of the price of articles necessary to their own existence resulting from this exportation.  This is a condition of very great influence on the development of an export trade.  The simple habits of the people of India;  immemorial custom which precludes them from the use of many commodities of secondary necessity, convenience, or luxury;  and the variety of the natural productions which the soil of the country supplies, exempt the people from the necessity of imports more than a limited number of commodities of foreign manufacture for their own use.  Hence it follows that the exports of Indian productions generally exceed in value the imports of goods from foreign countries, and the balance has to be paid directly or indirectly in treasure.

I say so much, by way of explaining why I believe that this drain of treasure from the West into India is likely to continue --it has been going on for the last five years at the rate of £4,700,000 a year-- and also in order to show that what has been going on in India has probably (I know no reason why I should not say certainly) been going on in other parts of Asia, e.g., China, where similar climatic, industrial, and social conditions are found to exist.  If this is the case, the appreciation of gold in the West must be largely due to this cause, and the proper remedy appears to me to consist in the remonetizing of gold in India, where the metal used from the most ancient times as money has, in British India at least, been discarded from that employment since 1835.

I assign the fluctuations which have occurred in recent years in the ratio of the precious metals to one another to the following causes:  (1) The great yield of silver from the mines in North America between 1870 and 1880.  (2) The partial disuse of silver as money by Germany, France, and the United States of America during the same period.  (3) The drain of gold into India between 1870 and 1885.  During those fifteen years India has withdrawn from use as money in the West a gold treasure valued at £38,250,000 and upwards, and has not used it as money herself.

Thus, while the supply of silver from the mines increased, the demand for it, owing to its exclusion from its proper field of employment as money, fell off, and measured by the gold standard its value necessarily declined.  At the same time gold became appreciated both by reason of part of the supply being absorbed and rendered useless as money by India, and from the circumstance that upon the gold currencies of the West was thrown the work not only which they formerly carried on, but in addition a great part of the work which the silver currencies of the same regions had hitherto been used to transact.

The relation which one of the precious metals bears to the other as money is ascertained by the quantity of the same commodity which a given amount of each of them will suffice to buy in the same market.  If gold and silver are coined and circulated without restriction of quantity in any country, and, say, an ounce of gold money will buy fifteen and one-half times as much of any commodity as an ounce of silver money, then the relation of gold to silver money in that country stands at 1 to 15½.  But if, as has happened in Europe since 1870, restriction is placed on the free coinage and circulation of silver money, its real value in gold money can never be ascertained, because its purchasing power, in consequence of the restriction placed upon its use as money, is deprived of all freedom of action.  Had gold and silver money been allowed to circulate freely throughout Europe and North America, and had India been using gold money since 1870, a fixation of value between gold and silver money exactly corresponding with that educed by the competitions of commerce would probably have been arrived at long since.  As the case stands, the owners of silver, seeking every opportunity to sell their commodity at a profit, have been obliged to offer it for sale, sometimes at one price and sometimes at another, and the price of silver has necessarily been subject to similar fluctuations as against gold that other articles are liable to, which take their value from gold in a falling market.

The purchasing power of the standard money depends on the proportion which the quantity of it in circulation bears to the amount of the merchandise which it serves to exchange one kind with another kind.  This view of the case is not affected by the use of the credit contrivances (checks, promissory notes, etc.) with the view of minimising the employment of metallic money, because their efficiency ultimately rests upon the stock of metallic standard money in use in the country.  If that stock increases while the commodities brought to market do not increase, prices will rise, and vice versa.

If the standard money of any nation or group of nations is required to do more work than it was required to do before, the effect on trade is the same as if the quantity of goods under exchange had increased while the amount of money available to effect the exchanges had remained stationary.  Prices in that case would fall.

If, on the other hand, the State decides to use both kinds of money on equal terms, that is, so to regulate its currency system that the silver and gold coin in use shall always exchange at their natural value in one another, which would be the rate elicited by the competitions of commerce, the supply of coin of both kinds will exactly correspond with the requirements of commerce and always be fully sufficient for the exchanges of goods, however numerous they may be.  The currency, whether of gold or silver, will always be kept at full supply, because no one will hesitate to put his gold or silver metal into circulation, under the conviction that neither can ever become undervalued and that he can in no circumstances lose by doing so.

9.  The relation of value between gold and silver has altered in favor of gold by from 20 to 25 per cent. during the last fifteen years, and in India, where silver alone is used as legal-tender money, the value of silver money, as against commodities, has not depreciated to an extent at all approaching that figure.  It follows that traders in gold-using countries can obtain in India, say, 20 per cent. more of the silver money of that country with a given value of gold than was possible fifteen years ago, and with it buy a correspondingly larger amount of the productions of India.  This state of things provides a wide margin to cover the risks of trade and the chances of profit, and is one among other causes which accounts for the great increase in the export trade of India to gold-using countries which has occurred during the last few years.

This consideration must also not be lost sight of, that, as above stated, India has, during the last fifty years. absorbed gold treasure to the value of £127,000,000 sterling.  This treasure can only have come into the country directly or indirectly as payment for the productions of India, whether sold in India or abroad, it has not gone into circulation as money, and its withdrawal from use as money has had an enormous influence in preventing that rise of prices which would have taken place in India if it had gone to swell the volume of the currency.

VIII.  Mr. Moreton Frewen says:

Since 1873 (from which time Germany commenced to take great masses of gold to enable her to effect a change from a silver to a gold standard) there has been a general fall of prices, which Mulhall estimates (History of Prices, page 1) at the amount of the difference between 135 and 84.  The average of prices is lower now than in 1850, at which time Newmarch remarks that prices had been falling steadily since 1809 on account of an increasing scarcity in the supply of the precious metals.  "Between 1809 and 1849 prices fell in the ratio of 100 to 41." (Jevons)

I think it is safe to say that in gold-standard countries there has been a general average decline of prices since 1874 of 35 per cent.  Now, as to silver-standard countries, there is a valuable chapter (16) in Fawcett's Political Economy which appears to have been written within two years of the professor's death.  The select committee on Indian finance which sat in 1874 established the fact that while for eight years previous to 1867 the net annual import of silver into India was at the rate of £15,000,000 sterling, the expansion of the currency there which resulted from this importation of £120,000,000 sterling of silver, had caused a rise of all prices, which rise was estimated to be from 30 to 40 per cent.  Now, since 1873, when the (gold) price of silver began to fall rapidly, there has been no such rise of prices in India as we should have naturally looked for, but, on the contrary, the Economist has been at some pains to point out, while there has been a great fall of silver in terms of gold, there has also been even a slight rise in the value of silver measured by its power to purchase Eastern commodities.

This, it seems to me, is the great interest that England has in the "silver question."  For it is clear that if silver in Asia is worth at the rate of 60d, an ounce, to buy everything Indian, it is not coming to Manchester if it can help it, where it is only worth 46d.  To recapitulate, it is interesting to observe that prices in India, between 1860 and 1870, rose rapidly without the price of silver falling below 60d, the ounce, but whereas since 1873 silver has been continuously falling from 60d. to 46d, yet so far from silver losing its value at home, in the East it is slightly more valuable --will buy a little more wheat, cotton, or labor than before.  If a man saw both sides of a balance scale go down at the same time he would hardly witness a more puzzling phenomenon.

There are a number of circumstances that have combined to enhance the value of gold;  chief among these an enormous increase in demand, while pari passu a great diminution in supply.  Increased demand may be classed under two heads:  The increased demand in gold-standard countries, the result of increased population and increased production of commodities;  for example, the amount of gold and silver current in the United States is about £3 per head of population to measure an annual production of wealth estimated by Mr. Atkinson (Distribution of Products) at £2,000,000,000 sterling.  The population of the United States is doubling every twenty-five years;  hence the United States twenty-five years hence, her population and production doubled, will cæris paribus require more currency.  I will not hazard an opinion as to the amount of coin per capita needed to insure a healthy system of currency.  France, however, with almost £9 per capita, showed by the rapidity of the payment of her war indemnity to Germany the benefit of a full and well distributed currency at a time of crisis.

But it is more important to draw attention to the increased area of the demand for gold.  Since 1873 Germany has taken over £80,000,000 sterling of gold.  Since 1878 the United States has taken more than £80,000,000;  Italy has taken £16,000,000 (Grenfell);  besides which in the last ten years India has taken £40,000,000 of gold. These extraordinary demands have averaged more than £20,000,000 a year, or more than £1,000,000 more than the entire annual output of the earth;  the while also that some £12,000,000 is being annually absorbed by the arts and manufactures (Soetbeer).  No wonder that since 1877 England has lost gold from currency to the amount of £25,000,000, or about one-quarter of her entire stock.  In M. de Laveley's words, "Gold, like water, if spread over a larger surface, lowers in level at its original basin."

4.  Is it the intention of question 4 to discover what has been the result in times past of a diminished product of the precious metals ?  If so, it is of interest that Alison (History of Europe) says that the fall of the Roman Empire was brought about by a violent contraction of the circulating medium, resulting from the failure of the mines in Spain and in Greece, the burden of debt was increased and the general conditions of human industry paralyzed.

The two greatest events that have occurred in the history of mankind have been directly brought about by a successive contraction and expansion of the circulating medium of society.  The fall of the Roman Empire, so long ascribed in ignorance to slavery, heathenism, and moral corruption, was in reality brought about by a decline in the silver and gold mines of Spain and Greece.

And as if Providence had intended to reveal in the clearest manner the influence of this mighty agent on human affairs, the resurrection of mankind from the ruin which those causes had produced was owing to a directly opposite set of agencies being put in operation.  Columbus led the way in the career of renovation;  when he spread his sails across the Atlantic he bore mankind and its fortunes in his bark. * * * The annual supply of the precious metals for the use of the globe was tripled;  before a century had expired, the prices of every species of produce were quadrupled.  The weight of debt and taxes insensibly wore off under the influence of that prodigious increase;  in the renovation of industry the relations of society were changed, the weight of feudalism cast off, the rights of man established.  Among the many concurring causes which conspired to bring about this mighty consummation, the most important, though hitherto the least observed, was the discovery of Mexico and Peru.

If the circulating medium of the globe had remained stationary or declining, as it was from 1815 to 1849, from the effect of South American revolution and English legislation, the necessary result must have been that it would have become altogether inadequate to the wants of man;  and not only would industry have been everywhere cramped, but the price of produce would have universally and constantly fallen.  Money would have every day become more valuable;  all other articles measured in money less so;  debt and taxes would have been constantly increasing in weight and oppression.  The fate which crushed Rome in ancient, and has all but crushed Great Britain in modern times, would have been that of the whole family of mankind.  All these evils have been entirely obviated, and the opposite set of blessings introduced by the opening of the great reserve treasures of nature in California and Australia. * * * Before half a century has elapsed the prices of every article will be tripled, enterprise proportionally encouraged, industry vivified, debts and taxes lessened. ---Allison.

After the fall of Rome no considerable mines were discovered and prices fell steadily for a thousand years, till Columbus sailed to America.  From 1539 to 1800, for near three hundred years after the discovery of America, had resulted in a tenfold increase in the annual output of gold and silver, prices rose steadily;  then after 1816, silver having been demonetized and specie payments resumed in England, prices steadily fell till there was a price crisis like the present, which extended and intensified just as now, till the Californian discoveries in 1849.  The effect of those great discoveries did not make any very considerable impression on the great volume of the precious metals till 1854, after which year prices rose steadily and every branch of industry was stimulated.

It is evident that "demand" created by legislation --in other words, the prerogative of "legal tender"-- is the great factor in determining the value of the precious metals.  This is particularly true of silver, because the percentage of the annual output of silver which is absorbed in the arts is quite inconsiderable.  Thus the tax paid on manufactured silver in England in 1875 (I can not lay my hands on any later returns of silver consumed in the arts) showed that the entire home manufacture was less than £200,000.

It seems that legislation can fix and keep steady the ratio of one metal to the other, provided the area of operation be sufficiently wide.  But if either metal be proscribed by legislation it is certain that their ratios must fluctuate wildly.  If legislation the world over decreed to-morrow that silver should be demonetized and should be sold as mere merchandise for what it would fetch, it might be that area railings would be made of silver !  Certainly the price would fall toward 1s. per ounce.  The value of gold also would be enormously depressed if that metal were universally demonetized.

A fall of prices is itself a contraction of credit.  To take a very simple instance, suppose I bought through a broker and on credit, cotton futures, or wheat, or a railroad stock at 100, I should pay up a margin of 10, the broker or his banker lending me the other 90;  now, if prices fell from 100 to 95, the broker would require a further margin;  in other words, owing to the fall of prices, my credit with my broker is contracted, and a further demand arises for sovereigns.  If, on the contrary, the price instead of falling rose to 110, the broker would allow me to buy a second hundred shares of stock, and on account of the rise in the price of the first hundred he would not require me to advance the ten sovereigns margin on the second transaction.  And this illustration holds good for all kinds of credit transactions, including the credit any wholesale dealer gives to any retail dealer.

Trade may be expected to stagnate when prices are declining, but to be brisk when prices are rising.  Falling prices can not fail to check industry and enterprise;  if a man with £10,000 to invest believes that because values are still falling, he will be able to buy a farm, a ship, or a mill twelve months hence for much less gold than at the present time, he will prefer to leave this £10,000 at his bank idle, even though the bank rate is only 1 per cent.  Suppose such a one had invested at the higher prices of 1874, if he sold out now he would find that his ten thousand had shrunk to £6,500 (assuming that the average fall of prices in twelve years has been 35 per cent.).  And this seems to be the present position;  intending investors are waiting year after year for the fall of prices to be complete.  When, on the other hand, the tendency of prices is upwards, then enterprise and investment is brisk.  The investor prefers to buy a farm to-day rather than to pay the higher price that he anticipates will be asked six months hence.

Until 1873 the 1 to 15½ "par of exchange" between the nations that used gold and those that used silver had never been impaired;  but in the last twelve years we have had perpetual fluctuations, and at the present moment no English merchant trading with the East has any idea when he makes a forward contract whether, owing to a further fall in the exchange rate of silver, the transaction may not involve him in heavy losses.  Ask any Manchester merchant what would be the condition of his trade with his best customers, India and China, if silver suddenly fell 6d., and he will tell you that half the mills in Lancashire would be closed;  and yet it has lately depended upon the mere accident of foreign legislation that this did not happen;  if the clamor of the Eastern cities --in other words, of the creditor community-- had prevailed and silver coinage had been suspended in the United States, then the silver ounce would have fallen at least 3d.  It is, indeed, the opinion of those most competent to judge that this suggested suspension must inevitably have been followed by the demonetization of silver in the United States, and thereafter also in France.

Hence it happens that a wheat speculator who used to buy 10 rupees with his sovereign can now buy 13, and each of the 13 buys as much wheat (say a bushel) as did each of his previous 10 rupees.  In other words, the fall of silver has brought about a decline in the price of wheat represented by the difference between 13 and 10.  And if, owing to legislation in Washington or Paris, silver is to be still further depressed and the rupee falls to 1s., I see no reason why that rupee should at all depreciate in India, and if it does not, then the fall in wheat in Mark Lane will be represented by the difference between 20 and 10, because the sovereign will buy 20 rupees instead of as before 10.  Keeping in view the fact that silver retains its value in the East, although it has by law been deprived of its value in the West, it follows that by reason of the absence of all tariff regulations in England our farmers are at the mercy of foreign monetary legislation at Washington or Berlin.  If Sir James Caird can foretell what will be the price of the silver ounce in the twentieth century, he can tell approximately what will be the area of wheat cultivation in England, in Dakota, or the Punjab.  With the rupee at 1s. no wheat could come forward from America or Russia and we might expect a further fall in the prices of maize and raw cotton, and it has been this consideration that has influenced recent legislation at Washington.

IX.  Mr. H.R. Grenfell says:

Trade is affected by alterations in the value of the "metal used as a standard" in proportion to the indebtedness of those carrying on various trades or callings connected with production.  If no one was indebted in fixed sums of the standard metal it would not matter in the long run whether the counters were red counters with a 6 marked on them or blue counters with a 1;  but where indebted producers have made specific contracts to pay in nothing but red counters, the relation between these counters and productions is altered, and the debtors have to pay the result of perhaps two years' labor instead of one.  Agricultural producers are indebted all over the world, and have always been so since the day when Adam brought a store of apples and damsons out of Paradise to keep him alive while he dug for the next year's crop, and they are being ruined by this alteration in the amount of existing counters.

X.  Mr. S.O. Gray says:

1.  It would appear that during the period since 1873 there has been a fall in the price of most commodities alike, but different in degree, in countries using gold or silver or both metals us a standard of value.

3.  There has been an increased demand for gold for the purposes of coinage by countries, Germany, Italy, and others, that have during the period mentioned above adopted a gold standard, and simultaneously the production of the metal has fallen off.  For silver, on the other hand, the demand for the purposes of coinage in Europe and for the manufacture of plate has materially diminished, while the available supply has been increased both by a larger production of fresh metal and by the demonetization and conversion into bullion if considerable amounts of previously existing silver coin.

XI.  Glasgow Chamber of Commerce, by Mr. William Hill, secretary, says:

3.  Since 1873 about two hundred millions of gold have been required to supply Germany, Italy, and the United States with a new gold currency.  This absorption of the metal occurred concurrently with its lessened production.  In 1851-'52 the annual production throughout the world had risen to about thirty-six millions sterling, but it is now less than twenty millions.  Assuming that ten millions are needed for the arts and manufactures, it follows that twenty years' net supply of the metal was absorbed by the two hundred millions, leaving nothing available for replenishing (repairing) the waste on a greatly enlarged currency, or for the purpose of meeting the wants of an increasing population, growing wealth, and consequent enlargement of business transactions.

4.  The directors have no personal knowledge of the previous occurrence of such circumstances.

5.  As respects silver, there has been an increased supply with a diminished use;  as regards gold, there has been a diminished supply with an increased use.  These results are due to the closure of the mints of the Latin Union for indiscriminate coinage of both metals at a fixed ratio;  to the action of Germany in demonetizing her silver currency;  and to the effect that the large stocks of silver held in America and Europe have on the market.

XII.  Mr. Luke Hansard says:

It appears to me that "the value of the metal used as the standard" must necessarily be measured by "the prices of commodities generally."  In this country the standard is gold, and the value of gold is what it will purchase in commodities generally.  If a general fall of prices is admitted, it follows that there is an appreciation of the metal in which those prices are expressed.  The expressions "fall in prices" and "appreciation of gold" are, in my opinion, synonymous, and it only leads to confusion of ideas in speaking of the two expressions as distinct and arising from separate causes.  I have frequently heard it stated in discussions, and have read in print, that the "fall in prices" is caused "by an appreciation of gold."  This appears to me an error, for the two phrases mean really one and the same thing.  If you have a fall in prices you have an appreciation of gold, and if you have an appreciation of gold you have a fall in prices.  In fact the two expressions are exchangeable terms for the purposes of the present subject.

XIII.  Sir Hector Hay says:

The specious argument that it is for the advantage of the working classes that all their requirements should be as cheap as possible is misleading, because a universal cheapness implies that the article or commodity which gives the means of living to each class of workers is cheap also, the consequence of which must be low wages or less employment, generally the latter, as is shown by the present state of the labor market and the large number of the unemployed.  It is no benefit to a working man that all he wants is very cheap if he has no wages wherewith to purchase it, and for the community it is better that all should be employed at moderate wages than that some should receive higher wages and the rest none.

Low prices invariably bring depression of trade and lack of employment, and high prices prosperity to all classes with the exception of annuitants, who are after all but a comparatively small section of the people.

Another disastrous effect is that the Indian government, having to draw some fifteen millions per annum from India, have had to submit to an enormous loss by exchange, beginning in 1874 with about one million and increasing every year till it amounts now to nearly four millions a year.  It has been said that this loss is only apparent, or, in other words, a mere matter of account, but this idea ignores the fact that this loss by exchange must be covered by increasing the amount of taxation in India, and therefore some thirty millions sterling base, during the last thirteen years, been wrung from the tax-payers more than would have been necessary had the rupee remained at its nominal value of about 1s. 10½d.  Taking this into consideration it will be apparent that India has lost much more by taxation than she has gained by the low price of silver.

The whole question of the ratio between gold and silver lies in a nut-shell.  In England, and practically in Europe generally, gold only is the measure of value;  in the East silver is the measure.  In order to enable trade between the East and West to be conducted with reasonable confidence there must be a standard of conversion, that is a fixed ratio of gold to silver.  If this is admitted it is difficult to see how it can be denied that the most advantageous ratio would be 15½ to 1, simply for this reason, that it would cause less inconvenience than any other, for practically all the silver money existing in the world (except merely the subsidiary coins) has been coined on or close to that basis.

To adopt any other ratio would necessitate the recoinage of hundreds of millions or the circulation of the present coins at a changed valuation, whereas the restoration of the old bimetallic basis of 15½ to 1 would affect only the few millions of silver which remain at present in the shape of bars, and the future production, say eighteen to twenty millions a year.

Such a measure as this by agreement among the principal nations, most of whom are more than willing to adopt it, would most certainly restore to the trade of the world that elasticity which of late years it has entirely lost.

XIV.  Mr. W. Jackson says:

Trade is affected by an appreciation of the metal used as the standard, by handicapping the producing classes to the benefit of the moneyed classes.  By rendering the trade between gold and silver using countries uncertain, and thus speculative.

The appreciation of gold in relation to silver has, in my opinion, tended to stimulate the exports of India, while the imports into India have also shown an increase, owing to the fall in prices in the gold countries.  The internal trade of India has developed by the greater exports and imports, and industries have received an impetus which will probably lead to the establishment of manufactories on a large scale.  Silver is, however, being imported into India in excess of the average of former years, and if this continues a rise in the prices of commodities in India seems inevitable, which must in time react prejudicially upon the export trade of India.

XV.  Mr. J.N. Keynes says:

There has not, I believe, been a corresponding fall in silver prices in countries where silver is the standard of value.  Still, notwithstanding the depreciation of silver, prices appear to have fallen rather than to have risen in India within the last ten or fifteen years.  This points to the conclusion that the depreciation of silver is a depreciation relatively to gold only, and not relatively to commodities in general, but rather the reverse.

The point that remains to be mentioned is perhaps of greater importance than any of the preceding.  Traders in a large way of business are accustomed to work to some extent with borrowed capital.  Upon the sum borrowed interest has to be paid in money, and ultimately the capital itself may have to be refunded in money.  It is clear that if money, measured in commodities, has an enhanced value, the burden of debts is increased, and with falling prices fixed preference charges mean diminished profits.  Thus lenders gain at the expense of borrowers, and, what is pertinent to the present discussion, they gain at the expense of those who are taking an active part in trade, and upon whose individual effort the success of large enterprises frequently depends.  Trade is the more depressed and demoralized because it is those who have the greatest business capacity who naturally employ, in addition to their own capital, the capital of others.  Similar remarks apply to fixed charges of any kind.

The internal trade of a gold-using country is not sensibly affected by an alteration in the value of the precious metals inter se, but it is otherwise with trade between gold-using and silver-using countries. Frequent alterations in the gold price of silver obviously introduce an additional element of speculation into all dealings between such countries.  If a trader in a gold-using country is selling commodities in a silver-using country, his profits depend not merely on the silver price which his goods will fetch, but also on the gold price of silver when he receives payment.  Fluctuations, therefore, in the relative value of the precious metals tend by their effect on the foreign exchanges to disorganize and render uncertain the trade between countries which have respectively a gold and a silver standard.  A permanent alteration, however, when once established, will only affect the nominal exchanges between the countries.

XVI.  Mr. D. Larnach says:

4.  I recollect perfectly that prior to the discovery of gold in 1849-'50 in California, and in 1851 in Australia, trade was depressed all over the world.  Those discoveries gave a wonderful impetus to trade, which would have been much more felt in England but for the Crimean war.

XVII.  Mr. Edward Langley says:

Taking wheat as perhaps the best illustration of an article of universal production and universal consumption the facts are beyond dispute.  Wheat has fallen to a price in gold-using countries that renders it barely remunerative, or even unremunerative.  In India the fall is estimated by Mr. Prinsep at 17 per cent.

3.  The following are some of the circumstances that have enhanced the value of gold:

Reduced production, which is a natural cause;  increase of population, which is also a natural cause.  But the circumstance that has caused the greatest enhancement in the value of gold is one that is not natural, but has been the attempt by Germany to convert her single silver currency to that of single gold, as by so doing Germany has stimulated other nations to do likewise;  such, for instance, as France, who within the last twelve months alone has increased her stock of gold by £12,000,000 (increased since this was written to £16,000,000, or, say, to £56,000,000 in all from £46,000,000 twelve months ago, more than equal to the year's production).  This action of France is still proceeding in full force, and can hardly fail to have a still further serious effect on the purchasing power of gold.  Then the action of the United States in resuming specie payments mainly in gold.  Also of Italy of the same character, as well as the continued absorption of gold by Germany, which is clearly still in operation, notwithstanding that she has suspended all sales of silver.  Then again, India is a large absorber of gold, a circumstance that can not be looked upon except with anxiety, as indicating a preference for that metal rather than for silver, her standard of value.  Australia and New Zealand also produce not only less gold, but practically absorb more, largely the result of their great borrowings in England, and indications are not wanting that those countries may draw gold from England, instances of which, though isolated, have actually occurred.

Then, again, the market which exists in London for the issue of foreign loans tends to enhance the value of gold, as such issues are generally followed by an export of gold to the countries issuing such loans.

Nothing can restore the profitable character of the enormous trade of England with silver-using countries but a restoration of the ratio that prevailed between 1803 and 1876, when the bimetallic law of France during all that time acted as a regulator to the mercantile machine that was working between England and her silver-using customers.  Whatever the merits are that are claimed for the single gold standard, it is utterly unsuited to a manufacturing nation like England, whose existence depends very largely on the profitable trade she can carry on with nations that have a currency composed of a silver metal.  This argument has been maintained by what is known as the bimetallic school, and ten years of experience only go to confirm their assertions.  There is not an article that is produced in India, and that is also produced in England, the continent of Europe, and in the United States, that is not subject to a protection bonus in India in the shape of the extent of the variation of the ratio between the precious metals.

The effect of the cessation of a fixed ratio between gold and silver has been a continuance of the fall in the value of silver, measured in gold, until at the present moment a rupee, the intrinsic value of which at 5s. the ounce for silver is close on 1s. 6d. in gold, can now be bought at under 1s. 6d., or a fall in its value of more than 20 per cent., and therefore at the present moment 1s. 6d. will buy in India more wheat than 2s. could have bought before the demonetization of silver took place, or, say, about thirteen years ago.  This gives the purchaser of Indian wheat an export bonus amounting to the reduced cost of the rupee, and thus enables Indian-grown wheat to compete with English wheat under a bonus of more than 20 per cent. over and above the cost of production.  This is bad enough, but the position is made worse by the appreciation of the rupee in India itself.

This, of course, secures cheap food, but at the cost of the destruction of the agricultural interests not only in England but also in Europe and the United States.  This is the reason why wheat is 30s. per quarter, with the prospect of a lower price, should silver fall lower.  The same argument applies to cotton in the United States, which is now selling at less than 5d a pound, a price, I understand, which in America it can not be produced to pay.

On the other hand, the same fall in the ratio of silver to gold operates in the opposite direction against Lancashire cotton manufactures.  Cotton goods may sell in India at the same prices as heretofore in rupees, but when a manufacturer proceeds to bring the proceeds of his goods back to England, in other words, so soon as he attempts to convert the rupees into gold, as he must do to complete the transaction, he is confronted by the same 20 per cent. depreciation in the price of silver as a charge against the operation.  He is thus compelled either to risk a higher price, that is to say, more rupees in India, to counteract the 20 per cent. loss by the depreciation in silver, or he must reduce the cost of production in England by paying less wages and less cost for his cotton.  Experience shows that he can not get higher prices for his goods in India, where this fact stimulates native manufacturers, and thus he is driven to reduce the cost of manufacture in England, and thus the reduction in the ratio of value between silver and gold falls directly on the English artisan and the American producer.

XXV.  Mr. Prideaux Selby says:

In its relation to commodities, silver has changed much less than gold, as is proved by the comparative stability of prices in silver-standard countries, and by this stability has proved itself, for the time, the more reliable standard of value of the two.  The fall in prices has, I believe, been much retarded by developments of the credit system, and would be intensely accentuated by any check to credit.  From my point of view the phrases used are but different ways of expressing the same fact, "appreciation of the metal used as the standard" means simply, as shown above, "a fall of prices generally."

XXVI.  Mr. Samuel Smith, M.P., says:

Speaking broadly, I believe the question to be this:  Up till 1873 the gold and silver bullion produced in the world flowed into Europe and was coined equally into money and performed exactly the same functions;  since 1873 silver has virtually been excluded from the mints of the great commercial nations of Europe, and the gold supply has also greatly fallen off.  The necessary result is that instead of that steady replenishment of the currencies which the growing needs of commerce require there is a diminution of supply, causing contraction and a fall of prices.  The result is analogous to that which took place after the resumption of specie payments was decided on in 1816, which produced many years of falling prices and great depression and suffering among the masses of the people.

Trade is very greatly and injuriously affected by a sudden alteration in the standard of value, especially when the alteration is, as now, towards increased value.  It arises in this way:  Trade is largely carried on by borrowed capital, or, in other words, by the use of

I have no doubt that this process exactly describes the condition of vast numbers of the traders of this country, and of other countries having a gold standard.  A great portion of the commercial capital of this country has silently passed into the hands of the mortgagees and bondholders who have neither "toiled nor spun";  the discouragement this state of things produces is intense;  after it has gone on for several years a kind of hopelessness oppresses the commercial community, all enterprise comes to a standstill, many works are closed, labor is thrown out of employment, and great distress is felt both among laborers and the humbler middle class;  indeed, it strikes higher than this, for multitudes of people who were once prosperous traders have now become dependent on charity.  I know many such myself;  indeed, but a small portion of those who were prosperous ten or fifteen years ago are well off now.

It is a foolish reply to this that the aggregate wealth of the nation is not changed because it is only a transfer from one class to another;  one might as well say that the craft of the pick-pocket or card-sharper is innocuous because it only transfers wealth from one pocket to another.  The prosperity of the nation depends upon the just distribution of wealth and the security of industry;  nothing affects it more vitally than unjust alienation.

One more point I would add.  This appreciation of gold, with its corresponding decline of trade, throws the finances of all gold-using countries into confusion;  it leads to deficits and increased duties, and makes foreign tariffs more and more protective.  India suffers in a somewhat different way, for she has to remit £15,000,000 in gold to England annually and is now losing £4,000,000 a year in exchange, and may in course of time lose £5,000,000 or £6,000,000 and find it almost impossible to carry out the railway extensions resolved upon, owing to the danger of borrowing in gold and the impossibility of borrowing in silver.

These extracts illustrate the views of all, or nearly all, who testified.  It is shown that there were meetings held in Liverpool, in Glasgow, in Manchester, and among the leading chambers of commerce, leading men everywhere taking part, and by large majorities reports were made favoring the restoration of silver to its old-time honored relation, yet our commissioner did not think it worth while to say anything about them.  I was not astonished at it;  they were not his productions, and of course he thought they were of no value.  I insert some of them by way of illustration of the feeling existing in Europe in regard to silver.  Hon. George Walker, consul-general at Paris, sent to Secretary Bayard, August 20, 1885, a letter in regard to coinage, from which I read the following extract:

The parliamentary inquiry in England, which has just been initiated by the appointment of a royal commission, distinctly recognizes that the discord at present existing between the precious metals is one of the alleged causes of industrial and commercial distress.  The appointment of Mr. Gibbs, one of the ablest English defenders of the bimetallic system, and of Sir Louis Mallet, who, with Lord Reay (now governor of Bombay), represented the Indian office in the international conference of 1881, to lead the inquiry on this subject, gives assurance that the investigation will be intelligent and thorough, and that all the facts which are believed to establish the impossibility of conducting the commerce of the world on a gold basis will be brought out in their true relations.

The chambers of commerce of Manchester, Birmingham, Liverpool, and Glasgow, four of the largest towns in the United Kingdom, have adopted resolutions calling on their members in Parliament to support this branch of the general investigation;  and it is very clearly indicated in the debates of the meetings at which these resolutions were passed, that an intelligent majority in those great commercial centers has reached the conclusion that the silver question is largely responsible for the existing distress, and I think I am justified in saying that they believe that bimetallism, to be established by international treaty, is the only sufficient monetary remedy.

With the adhesion of Great Britain, the adoption of international bimetallism would be very simple.  Without that adhesion, it would be equally practicable, safe, and effective if the system were accepted by Germany.  Of this there is much reason to hope, inasmuch as the prevailing sentiment of that country is unmistakably in favor of the restoration of silver to full monetary functions.  In Germany the learned body has taken the lead in this direction, and it has been followed by all the industrial classes, agricultural and manufacturing, and by the leading commercial houses in Hamburg and elsewhere.  It is also asserted that a majority of the national parliament has reached a similar conviction, and may, at an early day, be persuaded to act.

On the 8th day of July, 1886, the following is given of a meeting of the British and Colonial Chambers of Commerce, in which, by a majority of 28 to 15, they decided in favor of recoining their silver money:

The silver question --An animated discussion by English bankers in London-- They resolve that to remonetize silver means greater prosperity.
London, July 8.

An important meeting of the British and Colonial Chambers of Commerce was held yesterday, at which there was an animated discussion of the silver question and its bearings upon the commerce of India, Australia, and Great Britain.  Mr. Henry Gibbs, ex-governor of the Bank of England, opened the proceedings by a strong speech, showing the world-wide importance of restoring the monetary value of silver.  Sir Robert Fowler, M.P., the London banker and ex-lord mayor, opposed the idea in a speech which was feeble in comparison with that of Mr. Gibbs, and was followed by two Indian members.

Both of these contended that the effect of the depreciation of silver must be finally the ruin of the wheat and cotton industries of America, and the development of India as the chief wheat and cotton exporter of the world.  They, therefore, protested against England's aiding America to restore the value of silver at the expense of the interests of India.

Mr. Paul F. Irdman, an East India merchant, argued that England had other interests besides those of India, which stood sorely in need of the restoration of silver, and trusted that Mr. Gibbs's ideas would be adopted by the meeting.

Mr. Crump, of the London Times, denounced the agitation of the silver question as the work of the silver miners of Nevada, and their allies, the Washington ring.

Mr. Moreton Frewen opposed Mr. Crump in a strong speech in behalf of the farmers in the West and the planters in the South of America, and a resolution was passed by a vote, 28 to 15, amid great excitement, declaring that the remonetization of silver would relieve the depression under which trade is now staggering.  The meeting is regarded as highly important, and its influence upon the coming silver demonstration in Lancashire must necessarily be very strong.

I may as well add:

A year ago last June at a meeting of the British and Colonial Chamber of Commerce held in London, Sir Robert Fowler, member of Parliament and ex-lord mayor, is reported to have said "that the effect of the depreciation of silver must finally be the ruin of the wheat and cotton industries of America, and be the development of India as the chief wheat and cotton exporter of the world.

And also a high authority at home:

In the report of our Silver Commission made in 1877, Governor Boutwell, late Secretary of the Treasury (volume 1, page 138), says:

"It is no doubt true that the demonetization of either metal adds to the purchasing power of the metal retained for use, by diminishing the price of every article or merchandise, while it increases the burden of debts both public and private."

The result of this mass of intelligent testimony may be stated briefly as proving that so long as England alone maintained gold as the single standard there was no contraction of the circulating medium in the world's commercial transactions, and consequently no depression in trade because of a contracted currency.  France acted as the great clearing-house of the nations, but when the United States and Germany struck down their silver coinage in 1873, France, drained as she had been of $1,000,000,000 of gold by Germany shortly before, could no longer maintain her gold and silver coins on equal terms with free coinage, and had to protect herself against the combined attack of England, Germany, and the United States as best she could.

It also proves that the result of the withdrawal of silver as an equal factor with gold has been to reduce the value of all the past accumulations and present products of labor from 30 to 35 per cent. since 1873, by appreciating the value or purchasing power of gold to that extent, as they all agree that the appreciation of gold and depreciation of property mean the same thing, being only a different way of stating the same proposition.  They further agree that the annual product of gold is almost, if not entirely, absorbed in the arts and uses to which it is applied outside of coinage and by absorption in India and other silver-using countries, whose exports exceed their imports, and, when so absorbed, it never again appears as part of the world's coinage.  They assume as a proposition too plain for argument, that the effort to destroy one-half of the world's circulating medium and force the remaining half to perform the functions of both metals largely increased the burden of all the obligations of the debtor class by requiring 35 per cent. more of the property they hold or labor to produce to be sold to pay their debts than was needed when gold and silver were both legal-tender money at fixed rates, as they were when most of the present large obligations were contracted.

It did not require any evidence to prove what they all assumed as a necessary sequence of the facts they furnished, that steadily-falling values contract trade and production of every description to the limits, of absolute necessity, as no man can buy, borrow, or spend money to produce anything which he knows will be worth 10 per cent. less when his obligations mature than it is at the time he buys or produces it.  Of course, money is apparently abundant.  When these conditions exist nobody dares borrow it, no matter how low the rate of interest.  Labor suffers perhaps more than all else by enforced idleness and inability to change as production dwindles.

India alone, of all the possessions of Great Britain, has, as a country, profited by the rapacity of the gold-worshipers.  England, in 1835, prohibited the coinage of gold coin in that country, while she granted the colonial government the right to coin silver without limit.  Since that time the official tables which I hold in my hand show that the silver coinage of India has amounted to over $1,500,000,000.

As soon as the report and testimony taken by Lord Iddesleigh's committee appeared some very distinguished gentleman who did not sign his name, but his paper is evidently semi-official, took up the silver question in an elaborate article and with great ability he showed that all that was needed for England to crush out the export of agricultural products by the United States, was to induce the United States to stop the coinage of silver to keep down the price of it, and that India would soon supply England with all the cotton goods, with all the hemp products, with all the wheat, with all the tobacco she wanted, and the United States would be broken down, but above all he pleaded that England must never consent to restore legal-tender silver to her own coinage, as that would simply be building up the United States at the expense of England's leading colony.

One of the gentlemen who testified before Lord Iddesleigh's commission, Mr. Moreton Frewen, a very intelligent man, who I met once in the Northwest, sent me a copy of that pamphlet, which is entitled "The Silver Question, or Sacrifice of India," accompanied by a letter, in which he said, among other things:

A study of this pamphlet will, however, demonstrate the special difficulties by which England is beset.  One part of the Empire, in which gold alone is legal tender, is evidently suffering severely from the rapid appreciation of the standard;  another immense portion of the empire, in which the standard silver is depreciating, is as clearly gaining, and this gain, while partly at the expense of British agriculture, is more particularly at the expense of the United States.

If England now supports any legislation which restores to silver its old value and the old "par of exchange," then the wheat exports of British India will cease and also the cotton industry of India, now expanding so immensely, may be paralyzed.  The sole object of the writer of the "Sacrifice of India" is to protest against any legislation in England which, by restoring to silver the prerogative of legal tender, may keep silver steady at its former price, and thus secure to the United States the control of the export trades in cotton and wheat, a control which now promises to pass to India.

In this pamphlet the writer goes on to show --and I may take the liberty to make some extracts from it-- after showing the increase of India's trade in wheat and other things and the immense increase of her exports and imports, which I laid before the Senate the other day, and therefore need not repeat.  He says:

I trust I have succeeded in making clear the effect of low exchange upon the Indian wheat export.  Other articles of Indian produce which enter into competition with gold-using countries would similarly suffer by a rise in exchange and in the same proportion, for since that difference or loss could not be made up out of reductions in the cost of transport or out of traders' profits (these being already lowered to a minimum), it would have to come out of the pockets of the cultivators.  With articles such as indigo, or jute, or shellac, which are comparative monopolies of Indian production, and tea, which is produced only in silver countries, the benefit derived from low exchange ---that is, cheap silver--- is in the cheapening of the selling cost, and the consequent extending of consumption.  A return of exchange to the old ratio would increase the cost of tea in London by about 25 per cent.  Thus consumption would be checked, and consequently also the production in India and China.  The disturbance thus created would in course of time be adjusted by the ordinary law of supply and demand, but at the cost of the producing country.

Another important benefit conferred upon India by low exchange, but which is little noticed by the Government, is the encouragement to her local manufactures, of which the two most important, although there are many others, are the jute and cotton manufactures.  In these, besides an enormously extended consumption of both these manufactures within the country itself, their exports have increased as follows:

Cotton yarn, 1830-'81, 26,901,345 pounds;  1885-'86, 78,233,471 pounds;  cotton print goods, 1880-'81, 39,424,032 yards;  1885-'86, 51,574,372 yards;  jute, 1880-'81, 45,354,044 bags;  1885-'86, 82,774,207 bags.

In these industries alone, as already noticed, about one hundred millions of rupees are invested, and many thousands of well-paid operatives are happily employed.  The effect of raising exchange to the old ratio would be to interfere with these industries, but more particularly with the cotton.

Then he adds, in substance:  "Take care how you restore this silver coinage and bring back our old rival, the United States, into this trade.  You are not only protecting India, but you men in England are the principal beneficiaries.  You have increased our taxes three-fold, you are making us support the Indian army of the Queen, you have pensioned your hungry sons, otherwise unprovided for, upon us as a legacy of the old East India Company, and you are demanding all these tributes and subsidies in gold, so that while we have increased in prosperity very largely you are, in fact, getting the lion's share out of us at last."  Therefore by every appeal, in every form, the effort is to get England to stand by her single gold standard.  I have thought that the Royal Commission now in session will do it, although very many of the best men in that country desire that it shall be otherwise.

I hope the American Congress will show by equalizing our own coins and their uses that we do not intend to pander to them.  The Director of the Mint, Mr. Kimball, sent me a letter the other day when he saw that I was looking into this subject.  He said that the royal commission is being made to believe from the arguments before it that silver is produced so cheaply in this country that if its coinage is restored we can furnish it at less than 1s. 4d. (38 cents) to the dollar, their leading statistician is so declaring, and that the royal commission has in a preliminary report given great weight to it.  Mr. Kimball says this in his letter:

Your remarks in the Senate on the report of the royal commission suggests sending you a copy of a blank recently prepared by me. ---I did not know he was going to write to me--- I beg you to observe the note at the foot of the page.  Mr. Atkinson told me that he found great disinclination toward any change in the status of silver in Great Britain on account of the prevalence of the idea that silver is, or can be, produced at about half of the present bullion value, and that indeed it would be "shoveled" out in unprecedented volume if the status be improved.  This impression seems to mainly rest upon the preposterous estimates of Professor Austen, of the Royal Mint, whose testimony was taken by the commission, and with an exhibit of detailed statements, to be found in the appendix, which claims to be based on a technical analysis of industrial cost.  Nothing could be more misleading.  Yet I notice that more importance attaches to this testimony than to anything else brought forward during the whole proceedings.  Several English writers have since based arguments upon it.

I may say that no American technical authority has ever ventured to put forth a general estimate of cost of production in the case of the precious metals, the truth being, as pointed out by me in my Report on Production, 1835, page 26, that their cost as well as the supply, is to be considered subsidiary to a large extent to the production and reduction of miscellaneous ores, their part in the value of which is none the less an integral one.  A large part of the produce of both metals corresponds to the aggregate of small products, which bear a small, but widely varying, proportion to their cost.  Estimated as in the case of any other staple, the cost of silver is believed by most men acquainted with our mineral industries to be some multiple of its value.

While a few ventures yield a rich profit, a majority of gold and silver mining ventures fail to pay any interest on outlay, though in the aggregate contributing the larger part of the silver produced in the world.  This is a curious fact, and due mainly to the fascination which the search for the precious metals has for a large class in all countries where a few examples of successful operations are to be found.  I may take some occasion to follow out the methods of Professor Austen, whereby he has reached so false a conclusion.  I allude to his assumptions of cost of production, to the arbitrary way in which he has excluded all but successful ventures.  If the silver market had alone the product of these to depend upon, it would be in sad traits indeed.

Truly yours,
J.P. Kimball.

He furnishes the note which he is going to send out, and perhaps has sent out now, to leading men of the country to get information to contradict this report.  The note appended to the printed questions to which he calls my attention reads as follows:

The Director of the Mint hopes to be able to deduce some approximate estimate of the cost of producing silver under different circumstances in order to meet certain obviously erroneous statements before the present "royal commission appointed to inquire into the recent changes in the relative values of the precious metals." (London.)   This cost has been represented in testimony before that commission as low as 1s. 8d.

I referred a while ago to what the national banks were doing.  I happen to have in my hand a letter, which I intended to read, and may perhaps as well do it now, from a very distinguished gentleman, Hon. Edwards Pierrepont, dated November 22, 1887, in which he calls my attention to the action of these gentlemen;  and as he agrees precisely with my opinion about it, I will read what he says:

No. 103, Fifth Avenue, November 22, 1887.

Hon. James Beck, United States Senator:

My Dear Sir:  What your letter says about coin-notes I have read with interest;  but judging from the report of the bankers' convention held at Pittsburgh last month, I think that you will see a renewed effort to suspend silver coinage indefinitely.  On page 60 of the report is the following:

"The British Government has appointed a royal commission to investigate the silver question, which has made a preliminary report adverse to the double standard.  As the assent of England has been recognized by the most eminent bimetallists as essential to any effectual agreement upon the silver question, the committee recommend that this association delay action for the present, and await the final report of the royal commission to Parliament and the action of Parliament thereon. * * * The committee further recommends that the coinage of silver dollars by the United States, under the act of February, 1878, be suspended until the points at issue of the silver question be settled by international agreement."

These distinguished bankers are waiting until they can get an adverse report from England, which they are encouraging by every means in their power.  The moment they get it then the hue and cry will be raised again with redoubled energy that we are keeping dishonored money in circulation after the world has decided against it.  When they have done all they can to bring about the result they will claim that we can do nothing.  What Congress has to do to thwart their schemes is to take some honest step forward and show the world that we intend to hold on to what we have and to progress steadily and not retrograde at the dictation of any power, foreign or domestic.  Mr. Pierrepont adds:

This means an indefinite suspension of silver coinage, and nothing else.  It is well known that the "final," like the preliminary, report will be "adverse to the double standard."  Many honest men have been duped into the belief that by suspending our silver coinage we can force England into an international agreement about silver.  The smiling contempt with which the ruling class in England receives this suggestion is not complimentary to our intelligence.  The suspension of our silver coinage is exactly what they want.  Such suspension, they imagine, would largely increase the purchasing power of their gold;  however fallacious this view may prove in the long run, they now entertain it, and it will take many years to change them.  It is well understood in Great Britain that if Congress will once suspend the coinage of silver, the gold forces of England and America combined can prevent its restoration.

Some tell us that we ought to stop the coinage of silver, because they say that the intrinsic value of the silver dollar is worth less by 30 per cent. than the gold dollar.  This is an entire mistake.  In 1851 the silver dollar of the exact weight and fineness as now, was at a premium of 3.42 per cent. above the gold dollar, and for a period of forty years next, prior to 1873, it was continuously at a premium;  and in 1851 the gold of the world, in proportion to silver, was far less than it is to-day.

Was the intrinsic value of 100 cents of silver in 1851 3.42 per cent. more than the intrinsic value of 100 cents of gold ?  The legal value of a five-pound Bank of England note is five gold sovereigns --the legal value of a ten-dollar greenback is a gold eagle.  But the intrinsic value of the English bank-note and the American greenback together is nothing;  their only value is a value imposed by law, a fiat value, there is nothing intrinsic about it.  By far the chief value of all coins is fiat value.

All the gloomy predictions about the coinage of silver in our country have proved false.  We need not distress ourselves about the royal commission or the action of the British Parliament on the silver question.  If the continental governments which coined silver prior to 1873 would restore its coinage, there can be no reasonable doubt that the silver dollar would be quite equal to the gold dollar in the whole of continental Europe, as it now is in every corner of the United States.

But for the silver, what would have been our condition this last summer, with the national-bank notes reduced from three hundred and fifty-six millions to one hundred and sixty-five millions, and one hundred and ninety-four millions locked in the Treasury ?  In any country whose currency is reduced to gold, it is always easy for a few rich operators to "corner" the currency, throw down the price of stocks, wheat, cotton, and other commodities, and force those who have bills falling due to sacrifice their property to escape bankruptcy.  The member of Congress who shall vote to suspend the coinage and "await the report of the royal commission," will be a bold man or an idiot.  Is it possible that this great and powerful nation, quite the richest in the world, cannot devise a financial system suited to its conditions, instead of waiting in dazed bewilderment for the action of a British Parliament ?

I am, ever, faithfully yours,
Edwards Pierrepont.

To show why I have no confidence in our late commissioner on the silver question, I will add that Mr. Atkinson is a doctrinaire;  he is an able man and beyond doubt a man of integrity, but Mr. Atkinson is not the man whom anybody who knows him would select as a friend of silver money.  He testified before the commission of which the Senator from Nevada [Mr. Jones] was chairman.

Mr. Hoar.  The Senator from Kentucky will permit me to say, as he has alluded to an eminent constituent of mine, that the present Administration did send him to Europe on precisely that errand.

Mr. Beck.  I know it did, and that is what I do not like.

Mr. Hoar.  I understood the Senator to say that nobody ever sent Mr. Atkinson on any such errand.

Mr. Beck.  No.  We have made blunders.

Mr. Hoar.  You did say so.

Mr. Beck.  I read the resolution some time ago --perhaps the Senator was not in-- of the Senator from Delaware [Mr. Saulsbury], reciting that Mr. Atkinson had been sent, but that we do not propose to send him or any one else any more on such missions.  I propose to favor that resolution mainly because we have not sent the kind of men who were likely to do the most good.  There are gold worshippers in the Democratic party, I am sorry to say, as well as in the Republican party.  We are not strictly divided as parties on that line, there are some Senators who stand by me very earnestly on this question on the other side of this Chamber in sustaining our silver coinage and in giving it equal rights, I am happy to say.

Mr. Atkinson was asked the following questions by the silver commission in 1876 and answered them in this way.  After insisting that there were causes which made silver no longer fit to be a legal tender, he said, in answer to questions:

Q. 7.  Are these causes temporary or permanent ?

A.  No positive answer can be made to this question.  It is certain that silver has been recently subject to such great fluctuations that it is for the time being a most unfit substance for a standard of value.

Q. 8.  Would the relative value of gold and silver be affected by the remonetization of the latter in this country, coupled with the resumption of specie payments ?

A. The temporary increase of demand for silver would, I doubt not, increase its value in relation to gold, but only temporarily, and its ultimate relation to gold would be determined by the cost of production and the general demand for it in the world.  If the question implies the resumption of specie payments in silver, as a full legal tender, I think it implies an impossibility.  The resumption of specie payments depends upon confidence being restored.  To make an unlimited tender of this metal, at its old weight, would be so bad a breach of faith, and would imply such want of perception in regard to the needs of the time, as to destroy what little confidence there is now existing, and defeat the attempt itself.

Q. 9.  Which standard, the single gold or the double standard of gold and silver, is best calculated to facilitate a return to specie payments ?

A.  I think resumption will be retarded and not facilitated by any present alteration in the relation of gold and silver coins to each other, and that the silver coinage should remain a token coinage, carefully restricted to the actual demands of the country for tokens, and be as strictly limited as was the amount of fractional paper currency.

Q. 10.  If the double standard is adopted, what relation of value should be fixed between gold and silver ?

A.  That which is changing from week to week, or from day to day, can not be fixed by any statute.  I think no change should be made at present in the relation of the weight in our coins, nor should any change be attempted until the value of silver is fixed more than it is now.  Then there will be a basis for legislation as to the weight each coin should contain.

Q. 11.  If the United State should establish the double standard, would it have a tendency to confirm France, Italy, and Belgium and the other nations of the Latin Union, Austria, Russia, Holland, Mexico, Asia, and South America in their present policy of employing silver as an unlimited legal tender ?

A.  I do not think the example of the United States will affect intelligent statesmen anywhere.  I think we have blundered too much in the last ten years to have our example copied by any intelligent nation, until at least ten more years have expired, in which we have shown our fitness to teach.

If Senators will read the whole of the testimony of Mr. Atkinson, they will find that he was not only bitterly opposed to the restoration of silver to any position above mere subsidiary tokens, but he showed scant respect for the intelligence of those who differed from him.  I confess, therefore, to being astonished at his selection as the agent of the United States by the Secretary of State to induce England and other nations to aid us in restoring gold and silver as joint factors or units of value;  and I was not astonished that he ignored all the testimony taken before the Iddesleigh commission, which was in direct opposition to the views he has expressed before our Congressional joint committee.

That is not the kind of a man I should send to Europe to take care of silver.  But waiving all that and believing that the first thing for Congress to do is to assert our own rights and to let England, France, and Germany, and the bondholders of America, the bankers, and everybody else know that when we put out our coin, or any paper based upon it, that it is as good as any other coin or any other paper, and that we have not one coin for the rich and another for the poor, that gold and silver recognized by us at the standard value of July 14, 1870, in which all bonds are payable, is good enough for anybody, and that we intend to stand upon it and maintain it with all our power, and as every prediction up to this time in regard to what would happen if we attempted to do so has been falsified, we have a right to assume that the thirty-odd million dollars of gold coming in this year more than we exported, $174,000,000 having come since we began coining silver more than we have coined of silver with the effort made in 1880 to deposit gold and get silver certificates, when men deposited $80,000,000 of gold for them until they were stopped by the Treasury Department, if they do not deposit it now no harm can be done.  They are not obliged to do it.

We have surplus enough belonging to the people on which we can issue coin certificates, backed by the coin in the Treasury, whenever we please:  because the coin is in our own hands and will never be demanded if we have it on hand.  I do not see how anybody can object to that, except those who want to keep up a distinction and make a discrimination between the two metals and hold out to England and her Royal Commission that we are still undetermined, and if they will only struggle a little longer to maintain her single standard that we will give way to her and abandon our silver coin as hopeless.

I have thus imperfectly stated the object of the bill.  I shall endeavor to argue its merits more clearly and show our need for it when it comes up for a vote.  I know I have to give way to the Senator from Iowa [Mr. Allison] to call up what is known as the undervaluation bill which has the right of way, but at some very early day I will call up this bill and I will try to press it to a vote, and I will see whether the Senate of the United States will agree with me in believing that it is a step in the right direction.  Our present gold certificates are of no sort of use as circulation.  More than half of them are in denominations of $10,000 and over, so we are simply insurers of rich men's gold without pay;  that of course they want, as they want all else.  They are not currency in any sense.

In the mean time I will say now that I agree with the Senator from Delaware that there is no use in begging England, or Germany, or France, or any other country any more.  We are able to stand by ourselves and maintain a policy of our own, and I am not sure, in view of what is going on in the world, that we ought not to coin silver up to the maximum limit instead of the minimum.  That, however, is a question which may be discussed hereafter.

Gentlemen talk about compulsory coinage.  Why, Mr. President, the present law is simply a limitation upon a pre-existing right that all men could avail themselves of until the limitation was put on it, and as all holders of gold bullion get gold coin now free of charge.  We had to require that silver should be coined to the amount of at least $2,000,000 per month, because if we had not required it it would not have been coined at all.  How many dollars do you think would have been coined under the administration of the Senator from Ohio [Mr. Sherman] if he had not been required by law to coin at least $2,000,000 of silver per month ?  How many millions a month would have been coined under the administration of any Secretary of the Treasury from that day to this ?  Not a dollar.  They have been begging us all the time to stop it, and then call silver coinage compulsory.  There is free coinage of gold without a penny cost.

England by statute requires the Bank of England to pay for bullion, in bank notes which may be immediately exchanged for gold, £3 17s. 9d. for each standard ounce of gold that is offered, thus furnishing a market to everybody, we are inviting them all to coin their gold free.  When men produce silver we call it repudiated, depreciated stuff, token money, and everything else that is vile.  Unless we had required something to be done, nothing, I repeat, would have [been] done, and yet that is charged as being compulsory coinage.

I am not sure that we can maintain free coinage of silver by ourselves.  I am not clear about that.  That is a question for discussion.  But whatever we do put out as money we ought to maintain as equal to any money that we put out, and when we say that gold and silver shall stand upon an equality by our law, Congress having the power to coin money and regulate the value thereof, and the States having no right to make any thing a legal tender but gold and silver coin, either metal, coined by Congress the value of which has been thus regulated, when it is once in the hands of the people Congress must see that every particle of gold and silver is made equal for all uses;  and if we treat it as such ourselves we shall maintain it against the world as we can do, and the moment we do that then the nations of Europe will follow our example.

I meant to read some other papers, but I have talked very much too long.  I can show by official statistics that Austria can hardly keep her debts afloat;  Russia is substantially bankrupt;  Germany, with a great army, is staggering;  France, perhaps, is more in debt than any of them.  England confesses the depreciation of all values of 35 per cent. since 1873 until she, too, is staggering and her gold is leaving her.  They are all using more silver to-day than gold in their ordinary transactions and in spite of all their protests they will have to come back to it as a full legal tender;  and when they do, the double standard using both metals, will not be more than enough to meet the growing wants and needs of commerce and the growing wants of people whose needs are becoming greater as they are becoming richer and their commerce is becoming more extended.

I beg pardon of the Senate for having detained it so long.