Democratic Sentinel, Volume 2, Number 13, Rensselaer, Jasper County, 10 May 1878 — APPRECIATION, NOT RESUMPTION. [ARTICLE]

APPRECIATION, NOT RESUMPTION.

[From the New Haven Union.] John Sherman has given up all idea of resuming specie payments on the Ist of January next, under the Resumption act of 1875. His chief aim is to bring about the appreciation of the greenback to par with gold, and then, like the arrant trickster that he is, endeavor to make the public believe that he has really brought about specie payments. There is now outstanding a paper circulation of about $640,000,000, every dollar of which ought to be readily convertible into coin when resumption takes place, otherwise there is no resumption. Mr. Sherman claims that he has now $80,000,000 of coin in excess of all demands. He thinks he can issue $10,000,000 of coin certificates in excess of coin deposited, and holds at least $10,000,000 for which no demand will be made. Under his arrangement just made with the old Syndicate he will get $50,000,000 more by the Ist of January, thus giving him a grand total at the date of resumption of $145,000,000 of coin. The price under which Sherman proposes to dispose of $50,000,000 of United States 4j per cent, bonds to the money brokers is not as favorable as it might be, but Sherman doubtless holds to tlie view expressed by the New York Tribune, that “the Government could well afford to pay $5,000,000 or even $10,000,000 rather than fail in its undertakings.” That is to say, the carrying out of John Sherman’s policy will be so beneficial to the capitalists of Wall street that they consider the expenditure of a few millions of the people’s money in their behalf quite the thing on the part of the Government. Well, by the most favorable showing, granting that Sherman’s schemes all turn out just as he expects, the Government will have $145,000,000 of coin on the Ist of January next, with which to redeem $640,000,000 of paper. Can actual resumption take place on this basis ? Of course it would be absurd to argue that such will be the case. The Government and banks can only redeem about one-fifth of the paper outstanding. Sherman, however, does not propose to resume specie payments, but only to bring about an appreciation of the greenbacks to par with gold. When asked by Gen. Ewing if the banks would not take his small basis away from him at the start, he answered no, and then threw out a threat as to his power to cripple the banks should tliey show any lack of faith in his plans. He went on to unfold his scheme. He desires Congress to empower him to reissue $300,000,000 of the greenback circulation. That is to say, he wants to float just that amount of irredeemable paper money. He thus accepts as correct the theory of the Nationals, that it is wise to float an irredeemable paper money. And no doubt the proposed action of the Senate Finance Committee in the presentation of a bill making the greenbacks a full legal tender, and receivable for all dues, including customs, has Sherman's sanction. This measure alone if enacted long ago would have brought the paper currency to a par with gold, but coupled with the coin transactions of the Secretary and the remonetization of silver there is no doubt of its effect in bringing about appreciation in 1879. We have clearly demonstrated that the Secretary of the Treasury has no intention of establishing specie payments. He acknowledges his inability to substitute coin for the volume of paper money afloat. By stealing some of the greenback thunder, however, he proposes, and -undoubtedly will bring paper and coin together. Will this restore confidence and start the country upon an era of prosperity ? Not at all. A slight move on the European chessboard or a concerted movement on the part of the money brokers of Wall and Lombard streets is likely to take away Sherman’s base and force the Government to suspend the so-called specie payments established. Such a plan is not a permanent and satisfactory settlement of the financial problem. The currency will be kept contracted and the volume cannot be adjusted to the wants and necessities of the business of the country. The principle must be recognized that the Government alone possesses the sole prerogative of issuing money; and that an elastic system is the only salvation for our industries. Under Sherman’s plan the per capita of circulation will be a trifle above $9, while it should be certainly equal to that of France, which is $36. Sherman and his followers want to perpetuate the rational banks, which are a standing menace to the commercial interests and a burden to the people. While they hold sway the currency is sure to be kept inadequate to the wants of business. The experience of France proves that a full legal-tender paper currency can be floated in almost unlimited quantities and maintained at par with coin. This fact called forth the following from Victor Bonnet, the celebrated economist: “It apparently reverses the economical and financial principles which the authorities on the subject have hitherto labored to establish. * * * “Is financial science assuming a new aspect, and proving that we have been all wrong in fearing irredeemable paper money? Are we to learn that ideas have made progress, and that we are on the eve of realizing that famous ‘wagonway through the air’ spoken of by Adam Smith and Ricardo—a paper circulation without metallic base ? * * “ This is the new problem which agitates the world, and as to which there is more uncertainty than ever, after what has recently taken place in France.” Here is presented the problem of the National party. We favor the establishment of a paper-money system which will not depend upon the caprices of the capitalists of the world for its value, thus giving them an enormous power over the people.