Of these States, Switzerland alone did not coin up to her total, and at the conference in February, 1876, her delegates pressed strongly for the entire cessation of the coinage of the 5-franc piece, and for the adoption of a gold standard. In this she was strongly opposed by italy. The latter State, on account of the disappearance of her metallic currency before the inconvertible paper, had no interest in the limitation of the mintings of the Union. In the conference of 1874 she even sought and was authorized to coin beyond the quota accorded her, by a sum of not less than £800,000 in 5-fianc pieces, on condition that such amount should be deposited as a metallic reserve of the Bank of Italy.

The force of circumstances, however, soon broke down even this policy of limitation. In the course of 1876 the fall of silver became more disastrously pronounced. In addition, it was no secret that the amounts accorded by the conferences of 1874-75-76 for the mintings of each State had been assigned as maximum, not minimum, limits under the Latin Union.1

The next Mint convention of November, 1878, would determine the Latin Union on the 31st December, 1885, if not prolonged by further treaty. As the time approached the smaller States, such as Belgium, which had committed themselves to a large minting, and thereby to the liability of having to liquidate or take back its own mintingssuch 5-franc pieces as happened to be beyond its frontiers-at full value, in the face of a greatly fallen silver market, shrank from the responsibility, and sought and obtained a prolongation of the status quo until the end of 1891, and thence forward by yearly agreement.

Finding that individuals treated the agreed amounts of mintings as a minimum limit, the French government resolved to suspend the minting of the 5-franc pieces entirely. Accordingly, on the 21st March, 1876, M. Léon Say, Minister of Finance, submitted to the Senate a bill to that effect. It was followed, eight days later, by a proposition of a law suspending the emission of "bons" for the coining of silver money fine. The exposé des motifs of this act is most remarkable:

SUMMARY.

The events which have happened for some time past in the relations of the precious metals have brought to a head the monetary question among us, although from 1815 Great Britain has laid down principles which have attracted round her an everincreasing circle of nations.

"The theory of the double standard, on which our monetary law of the year XI. reposes, has been called in question ever since its origin.

"It is, to our conception, less a theory than the result of the primitive inability of the legislators to combine together the two precious metals otherwise than by way of an unlimited concurrence-metals both of which are destined to enter into the monetary system, but which recent legislators have learned to co-ordinate by leaving the unlimited function to gold alone and reducing silver to the rôle cf divisional money. From 1857 the French government has studied the question, and it may be stated that since that date the principle of the gold standard has won increasing favor through our several administrations."

Then follows an account of the monetary history of France during the period, as in brief résumé already given. "If," the preamble continues, "from 1874, certain precautions had not been taken to arrest the effects of that great perturbation in the ratio, France and her monetary allies would have seen their monetary circulation invaded by silver and correspondingly drained of gold." Hence the conventions of 1874-75-76, limiting the mintings of the members of the Latin Union, although, "according to us, the fall of silver in 1875 prescribed a complete cessation even for that year rather than simple limitation."

SOUND CURRENCY.

PUBLISHED SEMI-MONTHLY BY THE SOUND CURRENCY COMMITTEE OF THE REFORM CLUB. ENTERED AS SECOND-CLASS MATTER AT THE NEW YORK, N. Y., POST-OFFICE,

MAY 21, 1895.

Publication Office, No. 52 William St., New York City.

Vol. II, No. 16.

NEW YORK, JULY 15, 1895.

SUBSCRIPTION,
SINGLE COPIES, 5 CENTS.

$1.00.

Each number contains a special discussion of some Sound Currency question.

Look at the fix into which government has gotten itself. It is keeping out $346,000,000 of demand notes. It has enacted a law by which, as fast as they are brought in they are paid out again. This puts the credit of the United States absolutely at the mercy of Wall Street. The Government can beat Wall Street just as any man can beat Wall Street-only by keeping its paper out of Wall Street.

Democrats

If I buy a coat for $10, that means that the other man buys $10 for a coat. don't believe that government ought to interfere to make me buy one coat when I would prefer to buy another, and no honest man believes that I ought to be made to accept a coat different from the one I have bought. Will some free silver man explain how it is any more honest to make me contract for one kind of dollars when I would prefer another kind, or to make me take silver dollars when I have contracted for gold ones? If it is swindling for you to cheat me at the coat end of the trade, is it any less dishonest for me to swindle you at the money end of the transaction?

If wage earners believe they are getting too high wages, and that this country is suffering in consequence, all they have to do is to take lower wages; or, if they prefer a roundabout way, they can favor free coinage of silver, and they will get their wages cut down half without any further trouble on their part; and we will be blessed as are India and China.

"TREAT THEM ALIKE".

REASONS FOR THE USE OF GOLD.

CONSEQUENCES OF "FREE COINAGE" AS PROPOSED.

THE SILVER QUESTION IN A NUTSHELL

FREE COINAGE UNDEMOCRATIC AND OPPOSED TO FREE TRADE..
QUESTION SHOULD BE PROMPTLY SETTLED.....

APPRECIATION OF SILVER AND WAGES.

QUANTITY OF MONEY vs QUALITY OF MONEY.

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STATUS OF OUR CURRENCY.

For a generation, commencing in 1861, one act of Congress after another has arbitrarily meddled with our currency. The earlier ones were passed to enable government to levy forced loans, later ones were devised to temporize with resulting conditions, to aid the ambition of demagogues, to serve the ends of speculators, to line the pockets of favored classes—and each dragged the treasury ever deeper into affairs with which it had no proper concern. As a result our currency statutes are so voluminous that the average citizen cannot even scan them, and so confused that the government is occasionally re-discovering them; defunct as to their original ends, but virulent under conditions for which they were not planned; and so ambiguous as constantly to raise questions which must be cut rather than solved.

Two results have naturally followed. Our currency has become a "sea of trouble" about which the treasury splashes, and in which our public credit has narrowly escaped being drowned. And our people have come to consider currency questions as fit for experts alone.

If this be true, popular government is a failure. The problem of currency lies at the base of all commerce and at the door of all industry; and the public weal is at the mercy of those who are permitted to solve it. It is fortunate, therefore, that the problem is in reality a simple one. The complexity is in the devices by which, for their own purposes, political financiers have obscured it. The people as a whole are honest and businesslike. What they understand and approve is apt to be right and straight forward. In finance the roundabout and complex is generally bad.

FIAT MONEY THE ESSENTIAL QUESTION.

The Protean shapes which currency bedevilment assumes are but different forms of the one idea-that of Fiat money-interference by government in order to make a man take money that he otherwise would not take, or to make him take it under condi tions other than those under which he would naturally take it. It is an attempt to give either fiat currency to money, or a fiat value to currency-a value based upon the command of government, rather than intrinsic worth, as judged by you, of the money which you choose to take. That really sums up one side of the currency question. It is an interference with trade, with the money end of trade, with the one end in which everybody is concerned.

GREENBACK LEGAL TENDERS.

There are three shapes in which of late we have had it sharply before us. One has to do with our greenback issues. In the first place, the greenbacks are immoral. If the government owes anybody and that person will take the demand notes of government, there is no reason-in morals-why the government should not issue those demand notes. But, if the government is so poor that it has nothing else to pay with and its credit is so poor that its creditor cannot use these notes, and the government in order to help him out, compels every other citizen of these United States to accept these notes instead of the gold or silver which he contracted to receive at the time his contract was made, that is robbery, and robbery no less that it is perpetrated under the form of law. Such was our legal tender act. At the time when this law was enacted not a single man claimed that there was any excuse for it, except the fact that the government was in such straits that it must arbitrarily take people's property.

What is wrong for a man to do is wrong for a government to do, and what is wrong for any government to do is wrong for a big government, which is able to force it upon you. Such legislation can have no effect except injustice, because, if the government's credit is good, the law is superfluous. If it is not superfluous, it is because the people would not take government paper unless made to do so; and the result is a government forced loan levied upon them under the pretext of law.

There is another radical fault with the greenback idea which will appeal to everybody who has business experience. Suppose that you are a dry goods dealer, and that you inform a friend that you have gotten a new way to do business, that you are going to get trusted all you possibly can, and give out your demand notes. That friend will tell you that this is the craziest thing you ever attempted, and that you had better make your arrangements to buy for cash as far as possible, and get whatever indebtedness you can't pay now put into long time paper, so that you can take care of it as it matures. "Why," you might say, "I will have to pay interest on that paper." He would tell you that it will be a great deal cheaper for you to pay interest than to be liable at any day, whenever there is the slightest rumor as to your solvency or any tightness in the money market, to have these notes pour in over your counter for payment. Suppose you still hope to find some one who is willing further to trust you, and you pay out those notes again the next day?

It would put you in the power of any man who wanted to break you down and who should buy up your notes and hand them over the counter when you had the least cash to meet them? If a business man is to be independent, he must arrange his paper so that he can meet it when it comes due. Look at the fix into which our government has gotten itself. It is keeping out $346,000,000 of demand notes. It has enacted a law by which, as fast as they are brought back in, they are paid out again. This puts the government of the United States absolutely at the mercy of Wall Street. If the government didn't have its demand notes outstanding, capitalists could not shake the credit of this government. It can levy taxes, it can pay its debts, it can get on easily enough, provided it does its business in a business-like way. The government can beat Wal Street-just as any man can beat Wall Street-only by keeping its paper out of Wall Street.

"FREE COINAGE "-FORCED CURRENCY.

The "Free Coinage" agitation is another phase of the fiat money movement. "Free Coinage" is a misnomer. The word "free" is simply the livery of heaven which its advocates have stolen in which to serve the devil. Let me explain. If government, appreciating that its citizens use gold and silver as media of exchange, chooses to accommodate them by supplying coins of convenient size and guaranteed weight and fineness, that is all right. It is a good way for the government to serve the people. If it makes no charge or distinction in doing this, but gives anybody who chooses to bring bullion the full amount of that bullion in minted coin, and then leaves each man free to do what he pleases with it, we have free coinage and free commerce, just as free as anything could be. Is that what our silver friends want? No. They appreciate perfectly that this would do them no good. What they want is a law to give forced currency to depreciated silver.

Look at the situation. The law to make people take silver is not asked for by any. body who wants silver. If people want silver, no law is necessary to compel them to take it. It is just because people do not want silver, and will not take it unless they are compelled to, that the free silver people want a law to make them take it. The only people who want the law are, therefore, not those who want silver, but who want to get rid of silver, or who, owing debts payable in gold and thinking they can buy silver more cheaply, want to make their creditors take it instead of the gold they owe.

It is in Nevada, Colorado, Arizona and the other States whose politicians are clamoring for free silver that the people, and even the free silver capitalists, most uniformly hoard gold and take silver only when they cannot help it. The banks of those states hold eight, nine and ten times as much of gold as of silver. Those who borrow of Senator Stewart, the millionaire "free coinage" leader are obliged to make their bonds payable in gold. Indeed, the whole "free coinage " business is an attempt by those who advocate it to make other people take something they don't want themselves. Could a man be engaged in a meaner business?

One cannot blame the free-silver men for getting mad when they are called dishonest. That shows they have somewhat of self-respect left. But what is it they are trying to do? If I buy a coat for $10, that means that the man who sells it buys $10 with a coat. Democrats don't believe that government ought to interfere to make me buy one coat when I would prefer to buy another; and no honest man believes that I ought to be made to accept a coat different from the one I have bought. Will some free silver man explain how it is any more honest to make me contract for one kind of dollars when I would prefer another kind, or to make me accept silver dollars when I have contracted for gold ones? If it is swindling for you to cheat me at the coat end of the trade, is it any less dishonest for me to swindle you at the money end of the transaction?

It may be answered that we would still be free to make special contracts calling for gold if we so preferred. In the first place that is not the proposal of the more radical friends of silver." Again, if the suggestion has any force, it destroys their own posi tion. For that is just what they can do now in regard to silver. If legislation is to help them it must be such as to make less convenient the use of gold, which commerce prefers; and therefore such as arbitrarily to interfere with commerce.

But the free silver men ask: "Is not a silver dollar as good as a gold dollar, and don't they circulate on even terms? And if so, why shouidn't we extend the bimetal lism we now have?" No, a silver dollar is not as good as a gold dollar, and it does not circulate on even terms with it here or anywhere else; and the only reason that bimetallism in this country is not a farce is because it doesn't exist here at all-and never has existed here or anywhere else,

If I go to the Bank of Commerce and ask to have my note at thirty days discounted for $1,000,000, the polite cashier will explain to me that they have not got the money to loan. Any one knows what that means. If I can get Mr. Vanderbilt to write his name on the back of it, I can take it back to the same bank and it will discount the note at once and hand me the money if I want it. Supposing I had done so, and should brag that the Bank of Commerce had discounted my note for $1,000,000. Is there a man who would not know better, and who would not be able to tell me that it was Mr. Vanderbilt's indorsement that was discounted, and not my note? Now, a silver dollar has 50 cents worth of silver in it, and under the Sherman act the stamp of the Government gives it a gold indorsement. With that indorsement, it passes for a gold dollar. It is not the 50 cents worth of silver that passes for a dollar; it is the 50 cents worth of silver and the 50 cents of gold indorsement that passes, and I might just as well say that my note was as good as Mr. Vanderbilt's, because, when he had indorsed it, I could get it discounted, as to claim that a silver dollar is as good as a gold dollar just because, when a silver dollar has a gold indorsement, I can pass it on even terms with a gold

one.

There is another item which should be noted here. Mr. Vanderbilt is won a good deal more than $1,000,000, and it would not hurt his credit even if it were known that he had indorsed my note for that amount. If, however, it was known that he had writ ten his name across the backs of a number of blank notes, and had given them to me to be filled out and signed by me as I might see fit, his credit would be gone, and his in dorsement would be worth no more than mine. Just so with our silver currency. Our Government is a wealthy one, and the fact that it has put a gold indorsement upon nearly a thousand millions of fiat paper and depreciated silver has not yet destroyed its credit-though we have all seen how nearly it did. Free silver, however, means either that we shall go to a silver basis at once, or that the Government shall put a gold indorsement upon all the silver that anybody in the world now or hereafter chooses to bring it. The moment such a law was passed its credit would be no better than that of Mr. Vanderbilt, who had trusted me with his check book; and we would be on a silver basis notwithstanding.